Benzinga | Jun 9, 2021 02:07PM EDT

United Natural Foods Stock Tumbles On Q3 Revenue Decline, Margin Contraction, FY Guidance

* United Natural Foods Inc (NYSE:UNFI) reported third-quarter FY21 sales of $6.62 billion, a decrease of 5.9% year-over-year, missing the analyst consensus of $6.82 billion.

* Revenue from Chains fell 5.6% Y/Y to $2.95 billion, Independent retailers fell 11.4% to $1.6 billion, and Retail fell 9.3% Y/Y to $578 million, reflecting the impact of lockdowns.

* Gross margin of 14.6% contracted 34 basis points compared to last year. Lower levels of supplier-related income drove the margin decline in the Wholesale segment.

* Operating expenses in the third quarter were $866.5 million, or 13.09% of net sales.

* Adjusted operating margin of 1.52% contracted 45 basis points from the year-ago quarter.

* Adjusted EBITDA of $179 million fell 19.2% Y/Y.

* Net income fell 44.9% Y/Y to $49 million, translating to adjusted EPS to $0.94 (-29.3% Y/Y), beating the analyst consensus of $0.88.

* Net debt reduction of $62 million brought the fiscal year-to-date total to $175 million.

* Guidance: United Foods sees FY21 adjusted EPS between $3.05-$3.55, below the midpoint of the analyst consensus of $3.42.

* Price action: UNFI shares traded lower by 15.8% at $34.21 on the last check Wednesday.

* Image Courtesy: Wikimedia Commons