United Natural Foods, Inc. Reports First Quarter Fiscal 2026 Results

About this update from United Natural Foods, Inc.

PROVIDENCE, R.I., December 02, 2025 --( BUSINESS WIRE )--United Natural Foods, Inc. (NYSE: UNFI) (the "Company" or "UNFI") today reported financial results for the first quarter of fiscal 2026 (13 weeks) ended November 1, 2025. First Quarter Fiscal 2026 Performance (comparisons to first quarter fiscal 2025) Recent Financial and Operational Summary "We started fiscal 2026 with another quarter of solid execution and continued progress in delivering more value to our customers and suppliers as we strengthen effectiveness and efficiency. Our network optimization is proceeding ahead of schedule, and the benefits of recent supply chain investments, coupled with process improvements, is enabling us to strengthen service levels and increase throughput. This helped us deliver Adjusted EBITDA growth of nearly 25%, free cash flow meaningfully above last year and a sequential net leverage decline," said Sandy Douglas, UNFI’s CEO. Douglas continued, "As we move further into fiscal 2026, our focus remains on continuing to improve service levels while building tailored solutions and enhanced capabilities to help our customers and suppliers execute their unique growth strategies." First Quarter Fiscal 2026 Summary Net sales decreased 0.4% in the first quarter of fiscal 2026 compared to the same period in the prior year, primarily driven by continued growth in natural segment sales more than offset by an anticipated decrease in conventional sales primarily due to the transition out of the Allentown, Pennsylvania distribution center as well as strategic store closures in retail resulting in lower sales. Gross profit in the first quarter of fiscal 2026 was $1.1 billion, an increase of $13 million, or 1.3%, compared to the first quarter of fiscal 2025. The gross profit rate in the first quarter of fiscal 2026 was 13.4% of net sales compared to 13.2% of net sales in the first quarter of fiscal 2025. The increase in the gross profit rate was driven by the positive impact of network optimization and customer mix, the favorable impact of supplier programs and higher levels of procurement gains. Operating expenses in the first quarter of fiscal 2026 were $996 million, or 12.7% of net sales, compared to $1,015 million, or 12.9% of net sales, in the first quarter of fiscal 2025. The decrease in operating expenses as a percentage of net sales was driven by the benefits from cost saving initiatives, including higher levels of distribution center productivity. Interest expense, net for the first quarter of fiscal 2026 was $34 million compared to $36 million for the first quarter of fiscal 2025 driven by lower average outstanding debt balances. Effective tax rate for the first quarter of fiscal 2026 was a benefit of 55.6% on pre-tax loss compared to a benefit of 16.7% on pre-tax loss for the first quarter of fiscal 2025. The change from the first quarter of fiscal 2025 was primarily driven by discrete tax benefits from favorable audit settlements and employee stock awards in the first quarter of fiscal 2026. Net loss for the first quarter of fiscal 2026 was $4 million. Net loss for the first quarter of fiscal 2025 was $21 million. Net loss per diluted share was $0.06 for the first quarter of fiscal 2026 compared to net loss per diluted share of $0.35 for the first quarter of fiscal 2025. Adjusted EPS was $0.56 for the first quarter of fiscal 2026 compared to $0.16 in the first quarter of fiscal 2025. Adjusted EBITDA for the first quarter of fiscal 2026 was $167 million compared to $134 million for the first quarter of fiscal 2025. Capital Structure and Financing Overview Fiscal 2026 Outlook (1) The Company is affirming its full-year outlook: Conference Call and Webcast The Company’s first quarter fiscal 2026 conference call and audio webcast will be held today, Tuesday, December 2, 2025 at 8:30 a.m. ET. A webcast of the conference call (and supplemental materials) will be available to the public, on a listen only basis, via the internet at the Investors section of the Company’s website www.unfi.com . The call can also be accessed at (800) 715 - 9871 (conference ID 5462932). An online archive of the webcast (and supplemental materials) will be available for 120 days. About United Natural Foods UNFI is North America’s premier grocery wholesaler delivering the widest variety of fresh, branded, and owned brand products to more than 30,000 locations throughout North America, including natural product superstores, independent retailers, conventional supermarket chains, eCommerce providers, and foodservice customers. UNFI also provides a broad range of value-added services and segmented marketing expertise, including proprietary technology, data, market insights, and shelf management to help customers and suppliers build their businesses and brands. UNFI is committed to building a food system that is better for all and is uniquely positioned to deliver great food, more choices, and fresh thinking to customers. To learn more about how UNFI is delivering value for its stakeholders, visit www.unfi.com . Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release regarding the Company’s business that are not historical facts are "forward-looking statements" that involve risks and uncertainties and are based on current expectations and management estimates; actual results may differ materially. The risks and uncertainties which could impact these statements are described in the Company’s filings under the Securities Exchange Act of 1934, as amended, including under the section entitled "Risk Factors" in the Company’s annual report on Form 10-K for the year ended August 2, 2025 filed with the Securities and Exchange Commission (the "SEC") on October 1, 2025 and other filings the Company makes with the SEC, and include, but are not limited to, our dependence on principal customers; the relatively low margins of our business, which are sensitive to inflationary and deflationary pressures and intense competition, including as a result of the continuing consolidation of retailers and the growth of consumer choices for grocery and consumable purchases; our ability to realize the anticipated benefits of our strategic initiatives; changes in relationships with our suppliers; our ability to develop, implement, operate and maintain, and rely on third parties to operate and maintain, reliable and secure technology systems, and the effectiveness of the Company’s business continuity plans in response to an incident impacting the Company’s technology systems, such as the unauthorized incident on its technology systems; labor and other workforce shortages and challenges; the addition or loss of significant customers or material changes to our relationships with these customers; our ability to realize anticipated benefits of strategic transactions; our ability to continue to grow sales, including of our higher margin natural and organic foods and non-food products; our ability to maintain sufficient volume in our Natural and Conventional businesses to support our operating infrastructure; our ability to access additional capital; increases in healthcare, pension and other costs under our single employer benefit plan and multiemployer benefit plans; the potential for additional asset impairment charges; our sensitivity to general economic conditions including inflation, tariff policy and changes in disposable income levels and consumer purchasing habits; our ability to timely and successfully deploy our warehouse management system throughout our distribution centers and our transportation management system across the Company and to achieve efficiencies and cost savings from these efforts; the potential for disruptions in our supply chain or our distribution capabilities from circumstances beyond our control, including due to lack of long-term contracts, severe weather, labor shortages or work stoppages or otherwise; the effect of adverse decisions in, or settlement of, litigation or other proceedings to which we are subject; moderated supplier promotional activity, including decreased forward buying opportunities; union-organizing activities that could cause labor relations difficulties and increased costs; changes in tax laws and regulations, and actions by federal, state and local taxing authorities related to the interpretation and application of such tax laws and regulations; our ability to maintain food quality and safety; and volatility in fuel costs. Any forward-looking statements are made pursuant to the Private Securities Litigation Reform Act of 1995 and, as such, speak only as of the date made. The Company is not undertaking to update any information in the foregoing reports until the effective date of its future reports required by applicable laws. Any estimates of future results of operations are based on a number of assumptions, many of which are outside the Company’s control and should not be construed in any manner as a guarantee that such results will in fact occur. These estimates are subject to change and could differ materially from final reported results. The Company may from time to time update these publicly announced estimates, but it is not obligated to do so. Non-GAAP Financial Measures: To supplement the financial information presented on a U.S. generally accepted accounting principles ("GAAP") basis, the Company has included in this press release the non-GAAP financial measures Adjusted EBITDA, Adjusted EPS, adjusted effective tax rate, Free cash flow, Net leverage ratio and Capital and cloud implementation expenditures. Adjusted EBITDA is a consolidated measure which the Company reconciles by adding Net (loss) income including noncontrolling interests, less Net income attributable to noncontrolling interests, plus Non-operating income and expenses, including Net periodic benefit income, excluding service cost, Interest expense, net and Other (income) expense, net, plus (Benefit) provision for income taxes and Depreciation and amortization all calculated in accordance with GAAP, plus adjustments for Share-based compensation, non-cash LIFO charge or benefit, Restructuring, acquisition and integration related expenses, Goodwill impairment charges, Loss (gain) on sale of assets and other asset charges, certain legal charges and gains, and certain other non-cash charges or other items, as determined by management. Adjusted EPS is a consolidated measure, which the Company reconciles by adding Net income attributable to UNFI plus the LIFO charge or benefit, Goodwill impairment benefits and charges, Restructuring, acquisition, and integration related expenses, gains and losses on sales of assets, certain legal charges and gains, surplus property depreciation and interest expense, losses on debt extinguishment, the impact of diluted shares when GAAP earnings is presented as a loss and non-GAAP earnings represent income, and the tax impact of adjustments and the adjusted effective tax rate, which tax impact is calculated using the adjusted effective tax rate, and certain other non-cash charges or items, as determined by management. The adjusted effective tax rate is calculated based on adjusted net income before tax and excludes the potential impact of changes to uncertain tax positions, valuation allowances, tax impacts related to the vesting of share-based compensation awards and discrete GAAP tax items which could impact the comparability of the operational effective tax rate. Free cash flow is defined as net cash used in operating activities less payments for capital expenditures. Net leverage ratio (previously referred to as Net Debt to Adjusted EBITDA leverage ratio) is defined as the total carrying value of the Company’s outstanding short- and long-term debt and finance lease liabilities less net cash and cash equivalents, the sum of which is divided by the trailing four quarters Adjusted EBITDA. Capital and cloud implementation expenditures is defined as the sum of payments for capital expenditures and cloud technology implementation expenditures. The reconciliation of these non-GAAP financial measures to their comparable GAAP financial measures and the calculation of Net leverage ratio are presented in the tables appearing below, where practicable. The presentation of non-GAAP financial measures is not intended to be considered in isolation or as a substitute for any measure prepared in accordance with GAAP. The Company believes that presenting Adjusted EBITDA and Adjusted EPS aids in making period-to-period comparisons, assessing the performance of the Company’s business and understanding the underlying operating performance and core business trends by excluding certain adjustments not expected to recur in the normal course of business or that are not meaningful indicators of actual and estimated operating performance. The Company believes that providing the adjusted effective tax rate gives investors a meaningful, consistent comparison of the Company’s effective tax rate on ongoing operations. The inclusion of Free cash flow assists investors in understanding the cash generating ability of the Company separate from cash generated by the sale of assets. Net leverage ratio is a commonly used metric that assists investors in understanding and evaluating the Company’s capital structure and changes to its capital structure over time. The Company believes that providing Capital and cloud implementation expenditures provides investors with better visibility into the Company's total investment expenditures. The components of Capital and cloud implementation expenditures for fiscal 2026 will be primarily dependent on the nature of certain contracts to be executed. Management utilizes and plans to utilize these non-GAAP financial measures to compare the Company’s operating performance during fiscal 2026 to the comparable periods in fiscal 2025 and to internally prepared projections. These non-GAAP financial measures may differ from similarly titled measures of other companies. View source version on businesswire.com: https://www.businesswire.com/news/home/20251202243030/en/ Contacts INVESTOR CONTACTS: Steve Bloomquist Vice President, Investor Relations 952-828-4144 [email protected] Kristyn Farahmand Chief Strategy Officer 612-439-6625 [email protected]

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