UNFI 3Q16 Earnings Call Notes

Steve Spinner

Three strategic acquisitions in the last several months

” over the last several months with the completion of three strategic acquisitions. As many of you know, we completed the acquisition of Global Organic and Nor-Cal in the third quarter and most recently in May, we completed the Haddon House transaction. ”

Michael Zechmeister

Expect contraction in center store

“I mean I think the base business is generally stable. We know over time as I said in my prepared remarks that I think that those are going to continue to be contraction in the center-store, nothing new there which is why we work so hard to build out the perimeter and related kind of fresh offerings.”

Private labeling impacting center of store

” think that in the center of the store, one of the biggest drivers certainly in the national side is private labeling in mass and conventional which is escalating at an extremely rapid pace. So certainly the larger national branded manufacturers in the natural channel, one of the biggest uphill battles they are facing is just the plethora of new private label natural brands that are finding their way into mass and drug and convenience and conventional. So certainly that’s a trend that I think we’ve all been fighting with for some while, but again if you look back overtime, private labels tends to have a very cyclical nature to it, a lot of it comes on and then it backs off, a lot of it comes on and then backs off.”

Retailers will contract their center of store over time

“I don’t think there is any doubt that retailers are — will overtime contract their center-store as perimeter and products that they can be differentiated in, become more important. And so we’ve adjusted our model with that and so I think what you’re seeing in our sales growth is kind of this window of time where we’ve built the infrastructure, we’ve started to have contraction around, becoming penetrated in those categories, but not enough to move the needle.”