United Natural Foods, Inc. (NYSE: UNFI) has reported its financial results for the first quarter of fiscal 2025 (13 weeks) ended November 2, 2024. The company's net sales increased by 4.2% to $7.9 billion compared to the same period in the prior year. Additionally, adjusted EBITDA increased by 14.5% to $134 million, and adjusted EPS increased to $0.16.
In terms of net loss, the company reported a net loss of $21 million, resulting in a loss per diluted share (EPS) of $(0.35). This marks an improvement from the net loss of $39 million and loss per diluted share of $(0.67) in the first quarter of fiscal 2024.
The gross profit for the first quarter of fiscal 2025 was $1.0 billion, an increase of $8 million compared to the same period in the prior year. However, the gross profit rate decreased to 13.2% of net sales from 13.6% in the first quarter of fiscal 2024, primarily due to lower product margin rates and business mix, partly offset by supplier programs and lower shrink.
Operating expenses in the first quarter of fiscal 2025 were reported at $1,015 million, or 12.9% of net sales, compared to $1,023 million, or 13.5% of net sales, in the first quarter of fiscal 2024. This decrease in operating expenses as a percentage of sales was driven by the benefits from cost-saving initiatives and the leveraging impact of higher sales.
The company's free cash flow for the first quarter of fiscal 2025 was $(159) million, an improvement from $(328) million in the first quarter of fiscal 2024. This improvement was attributed to a $170 million increase in free cash flow compared to the prior year quarter, driven by improvement initiatives and lean management routines.
In terms of capital allocation and financing, the total outstanding debt, net of cash, was $2.23 billion at the end of the first quarter of fiscal 2025, reflecting an increase of $164 million compared to the end of the fourth quarter of fiscal 2024. The net debt to adjusted EBITDA leverage ratio was 4.2x as of November 2, 2024. The company's total liquidity was approximately $1.17 billion as of November 2, 2024.
As a result of the performance in the first quarter, the company is raising its full-year outlook for all financial metrics other than capital spending. The updated full-year outlook for fiscal year ending August 2, 2025, includes a net sales range of $30.6 billion to $31.0 billion, an adjusted EPS range of $0.40 to $0.80, and an adjusted EBITDA range of $530 million to $580 million.
The market has reacted to these announcements by moving the company's shares 25.0% to a price of $30.86. Check out the company's full 8-K submission here.
