United Natural Foods (NASDAQ:UNFI) shares tumbled more than 20% after the wholesale food distributor swung to a loss in the fourth quarter and management warned of challenges ahead.
For 4Q fiscal 2023, which ended July 29, 2023, UNFI reported a net loss of $68 million compared to a profit of $39 million in the year-ago quarter.
It swung from adjusted earnings per share of $1.27 to a loss per share of $0.25.
Inflation and new business contributed to a 2% year-over-year increase in sales to $7.42 million.
UNFI CEO Sandy Douglas noted that, while it grew sales across its customer channels, profitability declined due to a decrease in inflation-driven procurement gains and elevated shrink.
“We expect further headwinds as we continue to cycle elevated inflationary benefits during the first half of fiscal 2024," the CEO said in a statement.
The company issued disappointing guidance for fiscal 2024, expecting a net loss in the range of $36 million to $110 million.
It expects adjusted earnings in the range of earnings per share of $0.38 to a loss per share of $0.88.
Shares of UNFI shares fell 20.7% to US$15 at the market open on Tuesday.
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