WASHINGTON (dpa-AFX) - Natural and organic food supplier United Natural Foods Inc. (UNFI), Tuesday reported an increase in profit for the third quarter, as revenues improved reflecting demand for organic food. Both earnings and revenues for the quarter came in line with Wall Street analysts' estimates. Moving ahead, the company tightened its outlook for the full year.
Providence, Richmond-based United Natural Foods' third-quarter profit rose to $36.4 million or $0.73 per share from $31.6 million or $0.64 per share last year. On average, 16 analysts polled by Thomson Reuters expected earnings of $0.73 per share for the quarter. Analysts' estimates typically exclude special items.
Net sales for the third quarter increased 13.8 percent to $1.78 billion from $1.57 billion last year. Analysts estimated revenues of $1.78 billion for the quarter.
'Each of our sales channels continued to benefit from consumers increasingly choosing better-for-you natural, organic and specialty foods as illustrated by our second consecutive quarter of net sales growth in excess of $200 million,' said Steven Spinner, President and Chief Executive Officer.
Gross margin slipped to 16.7 percent from 16.8 percent hurt by foreign exchange losses from the declining value of the Canadian dollar. Operating costs, as a percent of sales, decreased 13 basis points to 13.2 percent.
Looking forward to full year 2014, the company now expect earnings in the range of $2.47 to $2.50 per share and sales of $6.73 billion to $6.77 billion. Analysts currently estimate earnings of $2.52 per share and revenues of $6.75 billion for 2014.
Earlier, the company expected earnings of $2.45 to $2.51 per share and revenues of $6.70 billion to $6.78 billion.
Last month, United Natural Foods agreed to buy Tony's Fine Foods, a distributor of perishable food products, for about $195.3 million in cash and stock. The company plans to expand its presence in high-growth perishable product offerings as well as boost its distribution footprint in Western US.
UNFI closed Tuesday's trading at $68.50, down $0.59 or 0.85%, on the Nasdaq. The stock further dropped $2.25 or 3.28% in after-hours trade.
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