United Natural Foods, Inc. · NYSE:UNFI
United Natural Foods — Q4 2022 Earnings Presentation
29 slides from United Natural Foods's earnings presentation, Sep 27, 2022
Slide 1: Fourth Quarter 2022 Earnings Conference Call
Fourth Quarter 2022 Earnings Conference Call September 27, 2022
Slide 2: Disclaimer
Disclaimer Certain information in this presentation and discussed on the conference call which this presentation accompanies constitutes forward-looking information within the meaning of the Private Securities Litigation Reform Act of 1995. Statements in this presentation regarding the Company’s bus
Slide 3: Agenda
Agenda Introduction Steve Bloomquist Vice President, Investor Relations Opening Remarks Sandy Douglas Chief Executive Officer Financial Results John Howard Chief Financial Officer Q&A Other Call Participants Chris Testa President Eric Dorne Chief Operating Officer Kristyn Farahmand Senior Vice Presi
Slide 4: Results Summary
Results Summary $ Millions, except for per share data Q4’22 Q4’21 % Change FY22 FY21 % Change Net Sales $7,273 $6,735 8.0% $28,928 $26,950 7.3% Adj. EBITDA $213 $206 3.4% $829 $770 7.7% EPS1 $0.63 $0.69 (8.7%) $4.07 $2.48 64.1% Adj. EPS $1.27 $1.25 1.6% $4.83 $4.18 15.6% • Surpassed midpoint of outl
Slide 5: Opening Remarks
Opening Remarks Sandy Douglas Chief Executive Officer Better Food. Better Future.
Slide 6: Employing Competitive Advantages to Drive Growth
Employing Competitive Advantages to Drive Growth Fuel the Future strategy optimizes value of scaled, diversified platform across $140B core, addressable market 1 • Serve over 30,000 customer locations and around 12,000 suppliers Scale • Achieving improving fill rates and attractive economics for our
Slide 7: Fuel the Future Strategy Delivering Improving Results
Fuel the Future Strategy Delivering Improving Results Cross Selling Sales Benefit Annually1 Adj. EBITDA Margin % 2022 Adj. EBITDA Contribution $ in Millions By Business Line2 $1,050 2.87% Services 2.86% 2.60% Platform3 $733 22% $431 +2.4x +0.27% Wholesale & Retail 78% FY20 FY21 FY22 FY20 FY21 FY22 •
Slide 8: Accelerating Investments to Enhance Long-term Growth
Accelerating Investments to Enhance Long-term Growth Layering on strategic, incremental investments to existing Fuel the Future strategy Capital Expenditures $ in Millions 3.00% $400 2.50% $350 $300 ~$350 2.00% $310 $250 $200 $251 1.50% $150 $173 1.2% 1.2% 1.00% $100 0.9% 0.50% $50 0.7% $0 0.00% FY2
Slide 9: Financial Results
Financial Results John Howard Chief Financial Officer Better Food. Better Future.
Slide 10: Q4 2022 Revenue Performance
Q4 2022 Revenue Performance $ in Millions $43 $8 $7,273 $169 +13.5% vs. PY $206 +12.4% vs. PY $112 +3.7% vs. PY $6,735 +8.2% Total Wholesale Growth vs. PY1 +8.0% Growth Q4'21 Chains Independent Supernatural Retail Elims & Other Q4'22 Retailers • Wholesale growth includes inflation, net of elasticity
Slide 11: Q4 2022 Adjusted EBITDA and Adjusted EPS
Q4 2022 Adjusted EBITDA and Adjusted EPS $ in Millions, except per share data. Totals may not sum due to rounding. Adjusted EBITDA Adjusted EPS $213 +8.8% $0.07 $0.02 $206 $0.08 $1.40 $1.33 ($0.09) $1.25 $1.25 $1.28 <($0.01) ($0.05) $1.27 $1.27 +8.8% +1.6% Growth; +3.4% +8.8%Growth Lower non-cash pe
Slide 12: Cash Flows and Balance Sheet Strategy
Cash Flows and Balance Sheet Strategy Creating strong foundation to drive reinvestment and future growth Operating Cash Flow Ex. Net Working Capital Capital Deployed Adjusted EBITDA Leverage Ratio $ in Millions $ in Millions $791 3.77x $618 $474 $697 2.97x $57 $366 2.55x $173 $310 $514 $461 $251 $38
Slide 13: Introducing FY 2023 Outlook
Introducing FY 2023 Outlook1 Expect to extend growth trajectory across key financial metrics Net Revenue Adjusted EBITDA Adjusted EPS $ in Billions $ in Millions $30.1 $865 $4.83 $5.00 $28.9 $829 $27.0 $770 $4.18 +4% Growth YoY; +4% Growth YoY +4% Growth YoY; >9% CAGR +6% CAGR +6% CAGR Potential cap
Slide 14: FY 2023 Adjusted EPS Outlook Drivers
FY 2023 Adjusted EPS Outlook Drivers1 $ in Millions, except per share data. Totals may not sum due to rounding. Adjusted EBITDA growth being partially offset by primarily non-cash items ~$0.44 ~$0.11 ~$0.01 ~($0.14) ~($0.06) ~($0.05) ~($0.15) $5.00 $4.83 ~$0.20 incremental, non- cash impact projecte
Slide 15: Investing Internal Cash Flow to Accelerate Growth
Investing Internal Cash Flow to Accelerate Growth Ample opportunity to capitalize on industry leadership position to drive growth and value Estimated FY23 Discretionary Cash Available1 $ in Billions $0.2 ($0.4) $0.9 ($0.1) Reflects elevated ($0.1) growth enablement and efficiency investments, ($0.1)
Slide 16: In Summary
In Summary Strong finish to 2022, ramping investment for future growth and value creation • Delivered strong operational and financial performance despite challenging economic and industry backdrop • Challenges of current environment highlight advantages of working with an industry leader • Position
Slide 17: Appendix
UNFI Appendix
Slide 18: Capital structure
Capital structure Reduced net debt by $174 million and lowered leverage by 0.4x in fiscal 2022 ($'s in Millions) Maturity Rate (2) Q4 FY20 Q4 FY21 Q1 FY22 Q2 FY22 Q3 FY22 Q4 FY22 (1) Secured term loan B-1 October 2025 S + 3.25% $ 1,773 $ 1,002 $ 994 $ 844 $ 800 $ 800 $2.6B ABL revolver (1)(3) June 2
Slide 19: Non-GAAP Metric Definitions
Non-GAAP Metric Definitions Adjusted earnings per share: The non-GAAP adjusted earnings per diluted common share measure is a consolidated measure, which the Company reconciles by adding Net income attributable to UNFI plus goodwill impairment benefits and charges, restructuring, acquisition, and in
Slide 20: Reconciliation – Adjusted EBITDA
Reconciliation – Adjusted EBITDA 20 Better Food. Better Future.
Slide 21: Reconciliation – Adjusted EPS
Reconciliation – Adjusted EPS 21 Better Food. Better Future.
Slide 22: Reconciliation – FY23 Outlook
Reconciliation – FY23 Outlook 22 Better Food. Better Future.
Slide 23: Reconciliation – Adjusted Effective Tax Rate
Reconciliation – Adjusted Effective Tax Rate The non-GAAP adjusted effective tax rate excludes the potential impact of changes to various uncertain tax positions and valuati on allowances, as well as stock compensation accounting (ASU 2016-09). 23 Better Food. Better Future.
Slide 24: Reconciliation – Last Four Quarters Adjusted EBITDA
Reconciliation – Last Four Quarters Adjusted EBITDA 24 Better Food. Better Future.
Slide 25: Calculation – Net Debt to Adjusted EBITDA Leverage Ratio
Calculation – Net Debt to Adjusted EBITDA Leverage Ratio 25 Better Food. Better Future.
Slide 26: Adjusted EPS By Quarter
Adjusted EPS By Quarter 26 Better Food. Better Future.
Slide 27: Adjusted EBITDA By Quarter
Adjusted EBITDA By Quarter 27 Better Food. Better Future.
Slide 28: Adjusted EBITDA By Segment
(1) Adjusted EBITDA By Segment 28 Better Food. Better Future.
Slide 29: Operating Cash Flow Excluding Changes in Net Working Capital
Operating Cash Flow Excluding Changes in Net Working Capital 29 Better Food. Better Future.