United Natural Foods(UNFI) - 2024 Q3 - Quarterly Report

Financial Performance - Net sales for the 13-week period ended April 27, 2024, were $7,498 million, a decrease of$9 million or 0.1% compared to $7,507 million for the same period in 2023[133]. - Gross profit for the 13-week period increased by$20 million, or 2.0%, to $1,020 million, with a gross profit margin of 13.6$25 million, or 2.6%, to $992 million, representing 13.2$27 million to $6 million for the 13-week period, primarily due to increased operating expenses and restructuring costs[146]. - Net loss attributable to United Natural Foods, Inc. for the 13-week period was$21 million, compared to a net income of $7 million in the same period last year, reflecting a decrease of$28 million[131]. - Adjusted EBITDA for the 13-week period was $130 million, down from$159 million in the prior year, a decrease of $29 million or 18.2$27 million in Q3 fiscal 2024 compared to Q3 fiscal 2023, primarily due to a 4.0% decrease in identical store sales[156]. - Wholesale net sales for fiscal 2024 year-to-date decreased by $4 million to$22,004 million compared to $22,008 million in fiscal 2023 year-to-date[155]. - Adjusted EBITDA for wholesale decreased by 12.6$125 million compared to $143 million in Q3 fiscal 2023[160]. Cost and Expenses - The company reported a product cost inflation of approximately 2$6 million for the 13-week period, compared to $33 million in the same period last year[138]. - Restructuring, acquisition, and integration-related expenses were$9 million for the 13-week period, compared to a benefit of $4 million in the same period last year[142]. - Loss on sale of assets and other asset charges increased to$13 million for the 13-week period, up from $4 million in the same period last year[144]. Debt and Capital Management - Total debt increased by$188 million to $2,151 million as of April 27, 2024, from$1,963 million as of July 29, 2023[171]. - The company expects to fund debt maturities and finance lease liabilities through fiscal 2024 with internally generated funds and borrowings under the ABL Credit Facility[167]. - The company currently does not pay a dividend on its common stock and is limited in the aggregate amount of dividends that may be paid under the terms of its debt agreements[170]. - The company entered into an amendment to the ABL Loan Agreement, creating a FILO tranche of $130 million with an applicable margin of SOFR plus 2.50$500 million, with maturity extended to May 1, 2031, and a change in the applicable margin from 2.25% to 3.75% per annum[173]. Investments and Expenditures - Capital expenditures for fiscal 2024 year-to-date were $217 million, a slight decrease from$218 million in fiscal 2023 year-to-date[177]. - Cloud technology implementation expenditures for fiscal 2024 year-to-date were $28 million, compared to$9 million in fiscal 2023 year-to-date[177]. - Fiscal 2024 capital and cloud implementation spending is expected to be approximately $370 million, focusing on distribution network automation and technology platform investments[178]. Cash Flow - Net cash provided by operating activities for the 39-week period ended April 27, 2024, was$54 million, a decrease of $348 million compared to$402 million in the prior year[179]. - Net cash used in investing activities increased to $226 million in fiscal 2024 year-to-date, compared to$211 million in fiscal 2023 year-to-date[180]. Distribution and Operations - The company operates 75 retail grocery stores, including 53 Cub Foods corporate stores and 22 Shoppers Food Warehouse stores[115]. - The company operates 81 pharmacies primarily within its stores and franchisees[115]. - A new distribution center in Manchester, Pennsylvania, is under development, covering approximately 1.3 million square feet, with a recognized right-of-use asset of $205 million[114]. - The company has been the primary distributor to Whole Foods Market for over 20 years, with an amended distribution agreement extending through May 20, 2032[109]. - The company believes its product mix positions it to serve a broad cross-section of North American retailers and end customers[111].