UNFI - United Natural Foods falls 22% after inflation benefit fades away

2023-03-08 07:45:37 ET

United Natural Foodss ( NYSE: UNFI ) nosedived in early trading after the organic food company reduced profitability expectations for fiscal 2023 and withdrawing fiscal 2024 targets.

A decrease in gross profit rate during FQ2 was primarily driven by lower current period procurement gains due to the decelerating rate of inflation and lower inventory gains. EPS was $0.78 vs. $1.44 consensus. Adjusted EBITDA for the quarter came in at $181M vs. $220M a year ago and $229M consensus.

"Profits were challenged as we did not repeat the significant level of procurement gains from rapidly accelerating inflation and inventory gains, due to supply chain volatility, that we experienced in the second quarter of last year," explained CEO Sandy Douglas.

United Natural Foods ( UNFI ) now sees full-year revenue of $30.1B to $30.5B vs. $29.9B to $30.4B prior view. EPS of $3.05 to $3.90 is anticipated vs. $4.85 to $5.15 consensus.

Shares of UNFI were down 22.00% to $31.95 at 7:45 a.m. on Wednesday to represent a new 52-week low.

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