United Natural Foods (UNFI) Oppenheimer's 24th Annual Virtual Consumer Growth and E-Commerce Conference summary

Recent performance and financial outlook

• Achieved $150 million in cost savings for fiscal 2024 and reduced shrink, leading to financial improvements and likely slight outperformance of 2024 guidance.

• Focused on a $90 billion addressable market, optimizing capital spending, improving working capital, and cost structure.

• Expecting free cash flow to approach $100 million in fiscal 2025, to be used for debt repayment.

• Targeting net leverage reduction to 2.5x or below by fiscal 2027, aiming for improved shareholder returns.

• Capital spending guidance reduced from $400 million to $370 million in 2024, and to $300 million in 2025, providing a $70 million free cash flow tailwind.

Strategic priorities and operational focus

• Strategy centers on serving natural, organic, specialty, and ethnic retailers seeking differentiation.

• Emphasizing value-added services, such as the new UNFI Retail Media Network, to drive profitability.

• Remargining the business through capital-light service growth and Lean Six Sigma principles.

• Improving free cash flow via EBITDA growth, inventory reduction, and better CapEx management.

• Driving accountability and decentralization through Lean Six Sigma and operational alignment.

Customer and supplier relationships

• Majority of customers fit the focused $90 billion segment, with growth expected from current and new share in this area.

• Willing to work with all customers if relationships are mutually beneficial, but focus remains on core segment.

• Supplier services modernized with data tools like UNFI Insights and the Media Network, enhancing supplier visibility and partnership.

• Supporting small suppliers and innovation through programs like UpNext and events such as Pitch Slam.