United Natural Foods Q1 Earnings Miss Views, Shares Drop

Shares of United Natural Foods, Inc. (NASDAQ: UNFI) dropped over 8.5 percent in after-hours trading Monday after the company reported weaker-than-expected earnings for its fiscal first quarter and lowered its forecast for the year.The Providence, Rhode Island-based company reported a quarterly profit of $30.1 million, or $0.60 per share, compared to $33 million, or $0.66 per share, in the year-ago quarter. Excluding items, the company's earnings came in at $0.63 per share. Its revenue rose 4.2 percent year-over-year to $2.08 billion from $1.99 billion. However, analysts were estimating earnings of $0.67 per share on revenue of $2.08 billion.Its gross margin shrank to 15.1 percent from 16 percent. Operating income slipped 7.7 percent to $53.9 million."Our first quarter financial results reflect an evolving marketplace for natural and organic foods. As consumers demand healthier options, rapid adoption of natural and organic products across sales channels has increased the competitive nature of our industry," said Steven Spinner, President and Chief Executive Officer. "Despite these headwinds, our customers have demonstrated their continued confidence in UNFI through contract extensions valued at over $785 million per year, in addition to a modification and extension of our contract with Whole Foods Market until 2025."For the year ending in July, the company now expects adjusted earnings of $2.79 to $2.89 per share, on sales of $8.43 billion to $8.59 billion. The company had earlier projected earnings of $2.86 to $2.98 per share, on sales of $5.51 billion to $8.67 billion.United Natural Foods shares fell 8.52 percent to $40.28 in the after-hours trading session.