Specialty foods distributor United Natural Foods Inc. (UNFI), Tuesday reported an increase in profit for the third quarter, as sales grew thirteen percent reflecting continued demand for its natural and organic foods. Earnings for the quarter were in line with Wall Street estimates, while revenues came in ahead of expectations.
United Natural Foods' third-quarter profit improved to $31.6 million or $0.64 per share from $29.0 million or $0.59 per share last year. Analysts polled by Thomson Reuters expected earnings of $0.64 per share for the third quarter.
Net sales for the third quarter grew 12.8 percent to $1.57 billion from $1.39 billion a year ago. Analysts expected revenues of $1.56 billion for the quarter.
Commenting on the results, Chief Executive Steven Spinner said, "We are pleased to report increased top and bottom line results in the third quarter of fiscal 2013, underscoring the continued demand for our products and services."
Gross margin dropped to 16.8 percent in the third quarter from 17.6 last year, hurt largely by sales shift to the conventional supermarket and an increase in freight costs.
Operating costs, as a percentage of sales, dropped 76 basis points to 13.4 percent, driven mainly by the company's ongoing initiatives to enhance productivity and reduce operating expenses throughout the organization.
Looking forward, United Naturals lifted its fiscal year 2013 sales guidance to a range of $6.03 billion to $6.06 billion, from its prior guidance of $5.88 billion to $5.98 billion.
United Naturals lowered its earnings guidance for the full year to a range of $2.12 to $2.14 per share, from a prior estimate of $2.12 to $2.18 per share.
The company now expects full-year adjusted earnings in the range of $2.15 to $2.17 per share, compared to its prior estimate of $2.15 to $2.21 per share.
Analysts currently expect earnings of $2.19 per share on revenue of $5.98 billion for fiscal year 2013.
UNFI closed Tuesday's trading at $55.64, up $0.74 or 1.35%, on the Nasdaq. The stock further gained $0.01 or 0.02% in after-hours trade.
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