-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, H6ZGe4o6lbmQvmRss61kztGPcPYbXAYtMh6wR6rdHVOfEKInkwb0/0rJxbpV64EY U92+GyEoDkOGWGTWviPcgA== 0001171520-04-000398.txt : 20041201 0001171520-04-000398.hdr.sgml : 20041201 20041201123938 ACCESSION NUMBER: 0001171520-04-000398 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20041130 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20041201 DATE AS OF CHANGE: 20041201 FILER: COMPANY DATA: COMPANY CONFORMED NAME: UNITED NATURAL FOODS INC CENTRAL INDEX KEY: 0001020859 STANDARD INDUSTRIAL CLASSIFICATION: WHOLESALE-GROCERIES & GENERAL LINE [5141] IRS NUMBER: 050376157 STATE OF INCORPORATION: DE FISCAL YEAR END: 0731 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-15723 FILM NUMBER: 041176578 BUSINESS ADDRESS: STREET 1: PO BOX 999 STREET 2: 260 LAKE RD CITY: DAYVILLE STATE: CT ZIP: 06241 BUSINESS PHONE: 8607792800 MAIL ADDRESS: STREET 1: PO BOX 999 STREET 2: 260 LAKE RD CITY: DAYVILLE STATE: CT ZIP: 06241 8-K 1 eps1598.txt UNITED NATURAL FOODS, INC. ================================================================================ SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of report (Date of earliest event reported): November 30, 2004 UNITED NATURAL FOODS, INC. (Exact Name of Registrant as Specified in Its Charter) Delaware 000-21531 05-0376157 (State or Other Jurisdiction (Commission File Number) (IRS Employer of Incorporation) Identification No.) 260 Lake Road Dayville, CT 06241 (Address of Principal Executive Offices) (Zip Code) (860) 779-2800 (Registrant's Telephone Number, Including Area Code) Not Applicable (Former Name or Former Address, if Changed Since Last Report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: |_| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |_| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |_| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) ================================================================================ Item 2.02. Results of Operations and Financial Condition. The following information is being furnished under Item 2.02-Results of Operations and Financial Condition. This information, including the exhibit attached hereto, shall not be deemed "filed" for any purpose, including for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section. The information in this Current Report on Form 8-K shall not be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or under the Exchange Act, regardless of any general incorporation language in such filing. On November 30, 2004, United Natural Foods, Inc. issued a press release to report its financial results for the quarter ended October 31, 2004. The press release is furnished as Exhibit 99.1 hereto. Item 9.01. Financial Statements and Exhibits (a) Financial Statements of Businesses Acquired: Not Applicable (b) Pro Forma Financial Information: Not Applicable (c) Exhibits. Exhibit No. Description ----------- ----------- 99.1 Press Release, dated November 30, 2004: United Natural Foods Reports Record Sales of $478 Million in the First Quarter of Fiscal 2005. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. UNITED NATURAL FOODS, INC. By: /s/ Rick D. Puckett ------------------------- Rick D. Puckett Vice President, Treasurer and Chief Financial Officer Date: December 1, 2004 EXHIBIT INDEX Exhibit No. Description ----------- ----------- 99.1 Press Release, dated November 30, 2004: United Natural Foods Reports Record Sales of $478 Million in the First Quarter of Fiscal 2005. EX-99.1 2 ex99-1.txt Exhibit 99.1 [LETTERHEAD OF UNITED NATURAL FOODS, INC.] IMMEDIATE RELEASE November 30, 2004 UNITED NATURAL FOODS ANNOUNCES 25% INCREASE IN NET SALES AND $0.24 IN DILUTED EARNINGS PER SHARE, A 42% INCREASE FOR THE FIRST QUARTER OF FISCAL 2005 Reports Record Sales of $478 Million in the First Quarter of Fiscal 2005 Raises Fiscal 2005 Earnings Guidance Dayville, Connecticut - November 30, 2004 -- United Natural Foods, Inc. (Nasdaq: UNFI) today reported net income of $9.9 million for the first quarter of fiscal 2005, ended October 31, 2004, or $0.24 per share on a diluted basis. Net sales for the first quarter of fiscal 2005 were $477.5 million, an increase of $96.2 million, or 25.2%, from the $381.4 million recorded in the first quarter of fiscal 2004. Strong growth in all sales channels of United Distribution contributed to the record sales. Net income for the first quarter of fiscal 2005, increased 50.0% to $9.9 million, or $0.24 per diluted share, compared to $6.6 million, or $0.16 per diluted share, excluding special items, for the quarter ended October 31, 2003. In the first quarter of fiscal 2004, special items consisted of a non-cash income item related to the change in fair value of certain interest rate swaps and the related option agreements. There were no special items for the quarter ended October 31, 2004. Net income for the first quarter of fiscal 2005, increased 45.8% to $9.9 million, or $0.24 per diluted share, compared to $6.8 million, or $0.17 per diluted share, including the effect of special items, for the quarter ended October 31, 2003. Historically, expenses related to the change in fair value of interest rate swaps, distribution facility expansions and asset impairment charges (including goodwill) have been classified as special items. However, at this time the Company does not know the extent or significance of these items or whether the Company will in fact incur any of these or other special items in fiscal 2005. The Company's guidance is based on a number of assumptions, which are subject to change and many of which are outside the control of the Company. If any of these assumptions vary, the Company's guidance may change. There can be no assurance that the Company will achieve these results. A description of the Company's use of non-GAAP information is provided under "Non-GAAP Results" below. The following table details the amounts and effects of the special items for the first quarter of fiscal 2004:
------------------------------------------------------------------------------------------------- Quarter Ended October 31, 2003 Pretax Per diluted (in thousands, except per share data) Income Net of Tax share ------ ---------- ----- Income, excluding special items: $10,806 $6,591 $0.16 Special items - Income Interest rate swap and related agreements (included in change in fair value of financial instruments) 304 186 0.01 ------------------------------------------------------------------------------------------------- Income, including special items: $11,110 $6,777 $0.17 =================================================================================================
All non-GAAP numbers have been adjusted to exclude special charges. A reconciliation of specific adjustments to GAAP results for the quarters ended October 31, 2003 is included in the financial table shown above. A description of the Company's use of non-GAAP information is provided under "Non-GAAP Results" below. On December 29, 2003, the Company assigned and transferred all of its obligations of its two "ineffective" interest rate swaps to a third party at a cost of $5.4 million plus accrued interest. As a result of this novation, these "ineffective" swaps will no longer be included as a special item for future fiscal periods. These "ineffective" swaps were included as a special item through the second quarter of fiscal 2004. The Company entered into interest rate swap agreements in October 1998, August 2001 and May 2003. The October 1998 and August 2001 agreements were "ineffective" hedges as a result of the options held by the counter parties that may extend the original term of the interest rate swap agreements. Applicable accounting treatment requires that the Company record the changes in fair value of the October 1998 and August 2001 agreements in its consolidated statement of income, rather than within "accumulated other comprehensive income" in its statement of stockholders' equity. The changes in fair value are dependent upon the forward looking yield curves for each swap. The May 2003 agreement is an "effective" hedge and therefore does not require this treatment. The Company believes that its October 1998 and August 2001 agreements are special items that are excludable as non-recurring items. First, the Company only intends to enter into "effective" hedges going forward. This stated intention began with the May 2003 agreement. Second, the Company believes that the October 1998 and August 2001 agreements may distort and confuse investors if the change in fair value cannot be treated as a special item because their inclusion directly impacts its reported earnings per share. A change in fair value, whether positive or negative, can significantly increase or decrease its reported earnings per share. For example, the Company recorded a positive change in fair value for the second quarter of fiscal 2004 that increased its diluted earnings per share by $0.01, and in the first quarter of fiscal 2003, the company recorded a negative change in fair value that decreased its diluted earnings per share by $0.03. If the Company were prohibited from excluding this item as a special item, it would artificially inflate its reported earnings per share and thereby mislead investors as to its results of operations and our financial condition. Comments from Management "Continuing our momentum from fiscal 2004, we are pleased to start off fiscal 2005 with another strong quarter of financial results." said Steven Townsend, Chairman and Chief Executive Officer. "Reflecting the efforts of a well-focused team and the successful execution of our sales and operating strategies which have been designed to meet the growing demand for natural and organic products, we realized solid gains in sales, net income, and earnings per share which are indicators that our plans are on target. These gains came despite the negative impact of the hurricanes that we experienced in Florida, rising fuel prices and the impact of our decision to close our Mounds View, MN facility due to its small size." Mr. Townsend added, "We remain focused on serving a broad customer base and are extremely pleased to report sales growth of 25% and comparable distribution sales growth of 12% excluding Wild Oats. In addition, we are pleased with our continued progress to improve operating margins. Our first quarter operating margin was 3.7%, up 26 basis points from the same period last year in spite of the impact of the hurricane, Mounds View closure and the rising fuel costs." Raises Fiscal 2005 Earnings Guidance The Company is raising its guidance for fiscal 2005, ending July 31, 2005, with projected revenues remaining in the $1.9 to $2.0 billion range, and projected earnings per share, excluding potential special items, increasing to a range of $0.95 - $1.00 per diluted share. Previously, the Company had announced earnings per share guidance, excluding potential special items, from $0.93 - $0.97 per diluted share. Conference Call Management will conduct a conference call and audio webcast at 11:00 a.m. ET on November 30, 2004 to review the Company's quarterly results, market trends and future outlook. The conference call dial-in number is 303-262-2130. The audio webcast will be available, on a listen only basis, via the Internet at www.fulldisclosure.com or at the Investor Relations section of the Company's website, www.unfi.com. Please allow extra time to the webcast to visit the site and download any software required to listen to the Internet broadcast. The online archive of the webcast will be available for 30 days. About United Natural Foods United Natural Foods, Inc. carries and distributes over 35,000 products to more than 18,000 customers nationwide. The Company serves a wide variety of retail formats including conventional supermarket chains, natural product superstores, independent retail operators and the food service channel. For more information on United Natural Foods, Inc., visit the Company's website at www.unfi.com. Financial Tables Follow For more information on United Natural Foods, Inc., visit the Company's website at www.unfi.com. AT THE COMPANY: FINANCIAL RELATIONS BOARD - -------------------------------------------------------------------------------- Rick Puckett Joseph Calabrese Chief Financial Officer General Information (860) 779-2800 (212) 827-3772 "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. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, including but not limited to general business conditions, the impact of competition and our dependence on principal customers, see "Risk Factors" in the Company's annual report on Form 10-K filed with the Commission on October 14, 2004, and its other filings under the Securities Exchange Act of 1934, as amended. 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 projections of future results of operations should not be construed in any manner as a guarantee that such results will in fact occur. These projections are subject to change and could differ materially from final reported results. The Company may from time to time update these publicly announced projections, but it is not obligated to do so. Non-GAAP Results: To supplement its financial statements presented on a GAAP basis, the Company uses non-GAAP additional measures of operating results, net earnings and earnings per share adjusted to exclude special charges. The Company believes that the use of these additional measures is appropriate to enhance an overall understanding of its past financial performance and also its prospects for the future as these special charges are not expected to be part of the Company's ongoing business. The adjustments to the Company's GAAP results are made with the intent of providing both management and investors with a more complete understanding of the underlying operational results and trends and its marketplace performance. For example, these adjusted non-GAAP results are among the primary indicators management uses as a basis for its planning and forecasting of future periods. The presentation of this additional information is not meant to be considered in isolation or as a substitute for net earnings or diluted earnings per share prepared in accordance with generally accepted accounting principles in the United States of America. A comparison and reconciliation from non-GAAP to GAAP results is included in the table within this release. UNITED NATURAL FOODS, INC. CONSOLIDATED STATEMENTS OF INCOME (Unaudited) (In thousands, except per share data) Three months ended October 31, -------------------- 2004 2003 -------- -------- Net sales $477,542 $381,382 Cost of sales 385,099 305,209 -------- -------- Gross profit 92,443 76,173 -------- -------- Operating expenses 74,597 62,932 Restructuring charge 170 -- Amortization of intangibles 141 232 -------- -------- Total operating expenses 74,908 63,164 -------- -------- Operating income 17,535 13,009 -------- -------- Other expense (income): Interest expense 1,433 2,320 Change in fair value of financial instruments -- (304) Other, net (101) (117) -------- -------- Total other expense 1,332 1,899 -------- -------- Income before income taxes 16,203 11,110 Income taxes 6,319 4,333 -------- -------- Net income $ 9,884 $ 6,777 ======== ======== Per share data (basic): Net income $ 0.25 $ 0.17 ======== ======== Weighted average basic shares of common stock 40,123 39,051 ======== ======== Per share data (diluted): Net income $ 0.24 $ 0.17 ======== ======== Weighted average diluted shares of common stock 41,580 40,364 ======== ======== UNITED NATURAL FOODS, INC. CONSOLIDATED BALANCE SHEETS (Unaudited) (In thousands)
October 31, July 31, 2004 2004 ----------- -------- ASSETS Current assets: Cash $ 5,753 $ 13,633 Accounts receivable, net 132,939 106,178 Notes receivable, trade, net 761 772 Inventories 214,255 196,171 Prepaid expenses 8,507 7,007 Deferred income taxes 8,061 7,610 -------- -------- Total current assets 370,276 331,371 Property & equipment, net 114,745 114,140 Other assets: Goodwill 57,399 57,242 Notes receivable, trade, net 1,996 1,601 Intangible assets, net 140 154 Other 4,000 4,259 -------- -------- Total assets $548,556 $508,767 ======== ======== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $115,541 $ 80,875 Notes payable - line of credit 99,138 107,004 Accrued expenses and other current liabilities 28,677 29,501 Current portion of long-term debt 8,134 4,766 Income taxes payable 5,021 -- -------- -------- Total current liabilities 256,511 222,146 Long-term debt, excluding current portion 39,318 43,978 Deferred income taxes 7,978 7,730 Other long-term liabilities 89 137 -------- -------- Total liabilities 303,896 273,991 -------- -------- Commitments and contingencies Stockholders' equity: Preferred stock, $0.01 par value, authorized 5,000 shares at October 31, 2004 and July 31, 2004, respectively; none issued and outstanding -- -- Common stock, $0.01 par value, authorized 50,000 shares; issued and outstanding 40,130 and 40,118 at October 31, 2004 and July 31, 2004, respectively 401 401 Additional paid-in capital 101,397 101,118 Unallocated shares of ESOP (1,727) (1,768) Accumulated other comprehensive (loss) income (80) 240 Retained earnings 144,669 134,785 -------- -------- Total stockholders' equity 244,660 234,776 -------- -------- Total liabilities and stockholders' equity $548,556 $508,767 ======== ========
UNITED NATURAL FOODS, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (In thousands)
Three months ended October 31, -------------------- 2004 2003 -------- -------- CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 9,884 $ 6,777 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 3,092 2,744 Change in fair value of financial instruments -- (304) Loss on disposals of property & equipment 9 2 Provision for doubtful accounts 466 570 Changes in assets and liabilities, net of acquired companies: Accounts receivable (27,227) (4,350) Inventory (18,084) (17,499) Prepaid expenses and other assets (1,876) 951 Notes receivable, trade (384) (357) Accounts payable 34,666 22,574 Accrued expenses and other current liabilities (841) (4,140) Income taxes payable 5,021 3,230 Tax effect of stock options 74 97 -------- -------- Net cash provided by operating activities 4,800 10,295 -------- -------- CASH FLOWS FROM INVESTING ACTIVITIES: Capital expenditures (3,590) (2,329) Proceeds from disposals of property and equipment 25 57 -------- -------- Net cash used in investing activities (3,565) (2,272) -------- -------- CASH FLOWS FROM FINANCING ACTIVITIES: Net repayments under note payable (7,866) (583) Repayments on long-term debt (1,292) (1,014) Principal payments of capital lease obligations (162) (288) Proceeds from exercise of stock options 205 366 -------- -------- Net cash used in financing activities (9,115) (1,519) -------- -------- NET (DECREASE) INCREASE IN CASH (7,880) 6,504 Cash at beginning of period 13,633 3,645 -------- -------- Cash at end of period $ 5,753 $ 10,149 ======== ======== Supplemental disclosures of cash flow information: Cash paid during the period for: Interest $ 1,377 $ 2,220 ======== ======== Income taxes, net of refunds $ 1,166 $ 388 ======== ========
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