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United Natural Expands Sales

United Natural Foods here said it will phase in at least $100 million in new sales this year from two new customers of its specialty division. However, Steven L. Spinner, president and chief executive officer, declined to identify the customers when questioned by analysts during an investor call last week to discuss financial results for the second quarter and first half, which ended

PROVIDENCE, R.I. — United Natural Foods here said it will phase in at least $100 million in new sales this year from two new customers of its specialty division.

However, Steven L. Spinner, president and chief executive officer, declined to identify the customers when questioned by analysts during an investor call last week to discuss financial results for the second quarter and first half, which ended Jan. 30.

“With the addition of specialty, we're starting to expand the relationships we have with organic-only customers into the specialty space and across a wider range of geographies,” Spinner said.

The new distribution center scheduled to open in Lancaster, Texas, in August or September, he added, “is going to create a whole slew of new opportunities for us.”

Net income for the second quarter rose 15% to $15.7 million, while sales increased 6% to $898.2 million. For the half, net income was up 16.1% to $31.2 million, while sales climbed 4.2% to $1.8 billion.

Spinner said sales trends improved late in the second quarter, “[with] a modest uptake toward the end of January and early February. It's really not been sizeable, but we've held that number for most of the quarter.”

United is continuing to work on its initiative to give vendors more visibility into its marketing and sales operations, Mark Shamber, chief financial officer, said.

“The first phase — giving participating suppliers a window into our inventory position by distribution center and by region so they can project purchases more adequately — is complete, and we are rolling that out.

“The second portion — the rollout of our new supply chain management system — will be a two-year process. We will have the first two distribution centers going live around July or August, and we'll follow that up with conversions of categories into the new systems.”

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