Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Oct. 28, 2017 | Nov. 30, 2017 | |
Document and Entity Information | ||
Entity Registrant Name | UNITED NATURAL FOODS INC | |
Entity Central Index Key | 1,020,859 | |
Current Fiscal Year End Date | --07-28 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Oct. 28, 2017 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 50,400,870 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Oct. 28, 2017 | Jul. 29, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 21,155 | $ 15,414 |
Accounts receivable, less allowances of $15,566 and $13,939 | 598,718 | 525,636 |
Inventories | 1,167,529 | 1,031,690 |
Deferred income taxes | 40,600 | 40,635 |
Prepaid expenses and other current assets | 51,540 | 49,295 |
Total current assets | 1,838,942 | 1,662,670 |
Property & equipment, net | 588,638 | 602,090 |
Other assets: | ||
Goodwill | 370,811 | 371,259 |
Intangible assets, less accumulated amortization of $53,441 and $49,926 | 204,421 | 208,289 |
Other assets | 43,500 | 42,255 |
Total assets | 3,046,312 | 2,886,563 |
Current liabilities: | ||
Accounts payable | 638,538 | 534,616 |
Accrued expenses and other current liabilities | 164,815 | 157,243 |
Current portion of long-term debt | 12,224 | 12,128 |
Total current liabilities | 815,577 | 703,987 |
Notes payable | 287,806 | 223,612 |
Deferred income taxes | 58,998 | 98,833 |
Other long-term liabilities | 28,883 | 28,347 |
Long-term debt, excluding current portion | 146,960 | 149,863 |
Total liabilities | 1,338,224 | 1,204,642 |
Commitments and contingencies | ||
Stockholders’ equity: | ||
Preferred stock, par value $0.01 per share, authorized 5,000 shares; issued none | 0 | 0 |
Common stock, par value $0.01 per share, authorized 100,000 shares; 50,963 shares issued and 50,801 shares outstanding at October 28, 2017, 50,622 shares issued and outstanding at July 29, 2017 | 509 | 506 |
Additional paid-in capital | 464,466 | 460,011 |
Treasury Stock, Common, Value | (6,449) | 0 |
Accumulated other comprehensive loss | (15,505) | (13,963) |
Retained earnings | 1,265,067 | 1,235,367 |
Total stockholders’ equity | 1,708,088 | 1,681,921 |
Total liabilities and stockholders’ equity | $ 3,046,312 | $ 2,886,563 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) shares in Thousands, $ in Thousands | Oct. 28, 2017 | Jul. 29, 2017 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowance (in dollars) | $ 15,566 | $ 13,939 |
Intangible assets, accumulated amortization (in dollars) | $ 53,441 | $ 49,926 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, authorized shares | 5,000 | 5,000 |
Preferred stock, issued shares | 0 | 0 |
Preferred stock, outstanding shares | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, authorized shares | 100,000 | 100,000 |
Common stock, issued shares | 50,963 | 50,622 |
Common stock, outstanding shares | 50,801 | 50,622 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Oct. 28, 2017 | Oct. 29, 2016 | |
Income Statement [Abstract] | ||
Net sales | $ 2,457,545 | $ 2,278,364 |
Cost of sales | 2,090,329 | 1,929,348 |
Gross profit | 367,216 | 349,016 |
Operating expenses | 312,109 | 295,677 |
Operating income | 55,107 | 53,339 |
Other expense (income): | ||
Interest expense | 3,667 | 4,522 |
Interest income | (91) | (99) |
Other expense (income), net | (863) | 383 |
Total other expense, net | 2,713 | 4,806 |
Income before income taxes | 52,394 | 48,533 |
Provision for income taxes | 21,889 | 19,316 |
Net income | $ 30,505 | $ 29,217 |
Basic per share data: | ||
Net income (usd per share) | $ 0.60 | $ 0.58 |
Weighted average basic shares of common stock outstanding | 50,817 | 50,475 |
Diluted per share data: | ||
Net income (usd per share) | $ 0.60 | $ 0.58 |
Weighted average diluted shares of common stock outstanding | 50,957 | 50,599 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | |
Oct. 28, 2017 | Oct. 29, 2016 | |
Statement of Comprehensive Income [Abstract] | ||
Net income | $ 30,505 | $ 29,217 |
Other comprehensive income (loss): | ||
Fair value of swap agreements, net of tax | 664 | 1,595 |
Foreign currency translation adjustments | (2,206) | (1,901) |
Total other comprehensive loss | (1,542) | (306) |
Total comprehensive income | $ 28,963 | $ 28,911 |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive (Loss) Income | Retained Earnings |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Treasury Stock, Common, Value | $ 0 | ||||
Beginning Balance (shares) at Jul. 29, 2017 | 50,622,000 | 50,622,000 | |||
Beginning Balance at Jul. 29, 2017 | $ 1,681,921 | $ 506 | $ 460,011 | $ (13,963) | $ 1,235,367 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Cumulative effect of change in accounting principle | (805) | ||||
Stock option exercises and restricted stock vestings, net of tax | 341,000 | ||||
Stock option exercises and restricted stock vestings, net of tax | (4,238) | $ 3 | (4,241) | ||
Share-based compensation | $ 7,275 | 7,275 | |||
Treasury Stock, Shares, Acquired | 162,073 | ||||
Treasury Stock, Value, Acquired, Cost Method | $ (6,449) | ||||
Adjustments to Additional Paid in Capital, Other | 107 | ||||
Fair value of swap agreements, net of tax | 664 | 664 | |||
Foreign currency translation adjustments | (2,206) | (2,206) | |||
Net income | $ 30,505 | 30,505 | |||
Ending Balance (shares) at Oct. 28, 2017 | 50,801,000 | 50,963,000 | |||
Ending Balance at Oct. 28, 2017 | $ 1,708,088 | $ 509 | $ 464,466 | $ (15,505) | $ 1,265,067 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Treasury Stock, Common, Value | $ (6,449) |
CONDENSED CONSOLIDATED STATEME7
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Oct. 28, 2017 | Oct. 29, 2016 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $ 30,505 | $ 29,217 |
Adjustments to reconcile net income to net cash used in operating activities: | ||
Depreciation and amortization | 22,442 | 21,215 |
Share-based compensation | 7,275 | 6,653 |
Loss on disposals of property and equipment | 103 | 265 |
Gain associated with acquisition of land | 699 | 0 |
Excess tax deficit from share-based payment arrangements | 0 | 1,421 |
Deferred Income Tax Expense (Benefit) | 891 | 0 |
Provision for doubtful accounts | 1,656 | 626 |
Non-cash interest expense (income) | 344 | (96) |
Changes in assets and liabilities, net of acquired businesses: | ||
Accounts receivable | (75,416) | (43,272) |
Inventories | (136,641) | (55,127) |
Prepaid expenses and other assets | (3,174) | 1,581 |
Accounts payable | 72,400 | 33,913 |
Accrued expenses and other liabilities | 8,284 | (3,651) |
Net cash used in operating activities | (72,030) | (7,255) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Capital expenditures | (5,257) | (9,198) |
Purchases of acquired businesses, net of cash acquired | (11) | (10,074) |
Proceeds from Sale of Property, Plant, and Equipment | 34 | 0 |
Payments for (Proceeds from) Other Investing Activities | 756 | 0 |
Net cash used in investing activities | (4,478) | (19,272) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Repayments of long-term debt | (2,985) | (367) |
Payments for Repurchase of Common Stock | (6,449) | 0 |
Proceeds from borrowings under revolving credit line | 173,581 | 94,356 |
Repayments of borrowings under revolving credit line | (109,229) | (99,408) |
Increase in bank overdraft | 31,873 | 29,787 |
Proceeds from exercise of stock options | 151 | |
Payment of employee restricted stock tax withholdings | (4,389) | (1,160) |
Excess tax deficit from share-based payment arrangements | 0 | (1,421) |
Capitalized debt issuance costs | 0 | (180) |
Net cash provided by financing activities | 82,553 | 21,607 |
EFFECT OF EXCHANGE RATE CHANGES ON CASH | (304) | (117) |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 5,741 | (5,037) |
Cash and cash equivalents at beginning of period | 15,414 | 18,593 |
Cash and cash equivalents at end of period | 21,155 | 13,556 |
Supplemental disclosures of cash flow information: | ||
Cash paid for interest | 3,667 | 4,522 |
Cash paid for federal and state income taxes, net of refunds | $ 2,559 | $ 2,873 |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Oct. 28, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES | SIGNIFICANT ACCOUNTING POLICIES (a) Nature of Business United Natural Foods, Inc. and its subsidiaries (the “Company”) is a leading distributor and retailer of natural, organic and specialty products. The Company sells its products primarily throughout the United States and Canada. (b) Basis of Presentation The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany transactions and balances have been eliminated in consolidation. The accompanying unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the "SEC") for interim financial information, including the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, certain information and note disclosures normally required in complete financial statements prepared in conformity with accounting principles generally accepted in the United States have been condensed or omitted. In the Company’s opinion, these condensed consolidated financial statements include all adjustments necessary for a fair presentation of the financial position, results of operations and cash flows for the interim periods presented. The results of operations for interim periods, however, may not be indicative of the results that may be expected for a full year. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended July 29, 2017 . Net sales consist primarily of sales of natural, organic and specialty products to retailers, adjusted for customer volume discounts, returns, and allowances. Net sales also include amounts charged by the Company to customers for shipping and handling and fuel surcharges. The principal components of cost of sales include the amounts paid to suppliers for product sold, plus the cost of transportation necessary to bring the product to the Company’s distribution facilities, offset by consideration received from suppliers in connection with the purchase or promotion of the suppliers' products. Cost of sales also includes amounts incurred by the Company’s manufacturing subsidiary, United Natural Trading LLC, which does business as Woodstock Farms Manufacturing, for inbound transportation costs offset by consideration received from suppliers in connection with the purchase or promotion of the suppliers’ products. Operating expenses include salaries and wages, employee benefits, warehousing and delivery, selling, occupancy, insurance, administrative, share-based compensation and amortization expense. Operating expenses also include depreciation expense related to the wholesale and retail divisions. Other expense (income) includes interest on outstanding indebtedness, including the financing obligation related to our Aurora, Colorado distribution center and the lease for office space for our corporate headquarters in Providence, Rhode Island, interest income and miscellaneous income and expenses. As noted above, the Company includes shipping and handling fees billed to customers in net sales. Shipping and handling costs associated with inbound freight are generally recorded in cost of sales, whereas shipping and handling costs for selecting, quality assurance, and outbound transportation are recorded in operating expenses. Outbound shipping and handling costs, including allocated employee benefit expenses, totaled $138.0 million and $126.9 million for the first quarter of fiscal 2018 and 2017 , respectively. |
RECENTLY ISSUED ACCOUNTING PRON
RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS | 3 Months Ended |
Oct. 28, 2017 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS | RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS In August 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities, which changes the recognition and presentation requirements of hedge accounting, including eliminating the requirement to separately measure and report hedge ineffectiveness and presenting all items that affect earnings in the same income statement line item as the hedged item. The ASU also provides new alternatives for applying hedge accounting to additional hedging strategies, measuring the hedged item in fair value hedges of interest rate risk, reducing the cost and complexity of applying hedge accounting by easing the requirements for effectiveness testing, hedge documentation and application of the critical terms match method and reducing the risk of a material error correction if a company applies the shortcut method inappropriately. This ASU is effective for public companies in fiscal years beginning after December 15, 2018, which for the Company will be the first quarter of the fiscal year ending August 1, 2020, with early adoption permitted. We are currently reviewing the provisions of the new standard and evaluating its impact on the Company's consolidated financial statements. In March 2016 the FASB issued ASU 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting , which is intended to improve the accounting for share-based payment transactions as part of the FASB's simplification initiative. This ASU has changed aspects of accounting for share-based payment award transactions including accounting for income taxes, the classification of excess tax benefits and the classification of employee taxes paid when shares are withheld for tax-withholding purposes on the statement of cash flows, forfeitures, and minimum statutory tax withholding requirements. The Company adopted the new standard in the first quarter of fiscal 2018. Accordingly, the Company will account for excess tax benefits or tax deficiencies related to share-based payments in its provision for income taxes as opposed to additional paid-in capital. During the 13 weeks ended October 28, 2017, the Company recognized $0.9 million of income tax expense related to tax deficiencies for share-based payments. In addition, the Company elected to account for forfeitures as they occur and recorded a cumulative adjustment to retained earnings and additional paid-in capital as of July 30, 2017, the first day of fiscal 2018, of approximately $0.8 million and $1.3 million , respectively. In February 2016, the FASB issued ASU No. 2016-2, Leases (Topic 842). The objective of this ASU is to establish the principles that lessees and lessors shall apply to report useful information to users of financial statements about the amount, timing, and uncertainty of cash flows arising from a lease. Lessees are permitted to make an accounting policy election to not recognize the asset and liability for leases with a term of twelve months or less. In addition, this ASU expands the disclosure requirements of lease arrangements. Lessees and lessors will use a modified retrospective transition approach, which includes a number of practical expedients. The ASU is effective for public companies with interim and annual periods in fiscal years beginning after December 15, 2018, which for the Company will be the first quarter of the fiscal year ending August 1, 2020, with early adoption permitted. We are currently reviewing the provisions of the new standard and evaluating its impact on the Company's consolidated financial statements. In November 2015, the FASB issued ASU No. 2015-17, Balance Sheet Classification of Deferred Taxes , which requires entities with a classified balance sheet to present all deferred tax assets and liabilities as noncurrent. The new pronouncement is effective for public companies with annual periods, and interim periods within those annual periods, beginning after December 15, 2016, which for the Company was the 13-week period ended October 28, 2017 . The Company adopted this guidance on a prospective basis in the first quarter of fiscal 2018 and it resulted in a reclassification from current deferred income tax assets to noncurrent deferred income tax liabilities of $40.6 million as of October 28, 2017 . In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers, (Topic 606) , which has been updated by multiple amending ASUs and supersedes existing revenue recognition requirements. The core principle of the new guidance is that an entity will recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The collective guidance is effective for public companies with annual periods, and interim periods within those periods, beginning after December 15, 2017, which for the Company will be the first quarter of the fiscal year ending August 3, 2019. The new standard permits either of the following implementation approaches: (i) a full retrospective application with restatement of each period presented in the financial statements with the option to elect certain practical expedients, or (ii) a retrospective approach with the cumulative effect of adopting the guidance recognized as of the date of initial application (“modified retrospective method”). The Company will adopt this new guidance in the first quarter of fiscal 2019 and is currently in the process of selecting a transition method and evaluating the impact of its adoption on the Company's consolidated financial statements, footnote disclosures and accounting policies. The impact of the new standard to the financial statements, footnote disclosures and accounting policies cannot be reasonably estimated at this time, however the Company continues to progress through its implementation assessment plan. As part of our assessment work to-date, we have formed an implementation work team, completed our scoping of revenue streams under the new ASU, reviewed certain material contracts with customers within our wholesale distribution segment to assess impacts of the ASU, and begun documentation of potential impacts of the ASU on our revenue streams. Additionally, we have begun our review of the enhanced disclosure requirements under this new standard. |
ACQUISITIONS ACQUISITIONS (Note
ACQUISITIONS ACQUISITIONS (Notes) | 3 Months Ended |
Oct. 28, 2017 | |
Business Combinations [Abstract] | |
ACQUISITIONS [Text Block] | ACQUISITIONS Wholesale Segment - Wholesale Distribution Acquisition Gourmet Guru, Inc. On August 10, 2016, the Company acquired all of the outstanding equity securities of Gourmet Guru, Inc. ("Gourmet Guru"). Gourmet Guru is a distributor and merchandiser of fresh and organic food focusing on new and emerging brands. Total cash consideration related to this acquisition was approximately $10.0 million , subject to certain customary post-closing adjustments. The fair value of identifiable intangible assets acquired was determined by using an income approach. The identifiable intangible asset recorded based on a provisional valuation consisted of customer lists of $1.0 million , which are being amortized on a straight-line basis over an estimated useful life of approximately two years. During the first quarter of fiscal 2018, in finalizing the purchase accounting related to the Gourmet Guru acquisition, the Company recorded an increase to goodwill of approximately $0.2 million with a decrease to prepaid expenses. The goodwill of $10.3 million represents the future economic benefits expected to arise that could not be individually identified and separately recognized. Operations have been combined with the Company's existing wholesale distribution business and therefore results are not separable from the rest of the wholesale distribution business. The Company has not furnished pro forma financial information relating to this acquisition as such information is not material to the Company's financial results. |
RESTRUCTURING ACTIVITIES AND AS
RESTRUCTURING ACTIVITIES AND ASSET IMPAIRMENTS | 3 Months Ended |
Oct. 28, 2017 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Activities Disclosure [Text Block] | RESTRUCTURING ACTIVITIES AND ASSET IMPAIRMENTS 2017 Cost Saving and Efficiency Initiatives. During fiscal 2017, the Company announced a restructuring program in conjunction with various cost saving and efficiency initiatives, including the planned opening of a shared services center. The Company recorded total restructuring costs of $6.9 million during the fiscal year ended July 29, 2017, all of which was recorded in the second half of fiscal 2017. Of the total restructuring costs recorded, $6.6 million was primarily related to severance and other employee separation and transition costs and $0.3 million was due to an early lease termination and facility closing costs for the Company's Gourmet Guru facility in Bronx, New York. The following is a summary of the restructuring costs the Company recorded in fiscal 2017, as well as the remaining liability as of October 28, 2017 (in thousands): Restructuring Costs Recorded in Fiscal 2017 Payments and Other Adjustments Restructuring Cost Liability as of October 28, 2017 Severance and other employee separation and transition costs $ 6,606 $ (3,750 ) $ 2,856 Early lease termination and facility closing costs 258 (258 ) — Total $ 6,864 $ (4,008 ) $ 2,856 |
EARNINGS PER SHARE
EARNINGS PER SHARE | 3 Months Ended |
Oct. 28, 2017 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | EARNINGS PER SHARE The following is a reconciliation of the basic and diluted number of shares used in computing earnings per share (in thousands): 13-Week Period Ended October 28, October 29, Basic weighted average shares outstanding 50,817 50,475 Net effect of dilutive stock awards based upon the treasury stock method 140 124 Diluted weighted average shares outstanding 50,957 50,599 For the first quarter of fiscal 2018 and fiscal 2017 , there were 155,041 and 48,808 anti-dilutive share-based awards outstanding, respectively. These anti-dilutive share-based awards were excluded from the calculation of diluted earnings per share. |
FAIR VALUE MEASUREMENTS OF FINA
FAIR VALUE MEASUREMENTS OF FINANCIAL INSTRUMENTS | 3 Months Ended |
Oct. 28, 2017 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS OF FINANCIAL INSTRUMENTS | FAIR VALUE MEASUREMENTS OF FINANCIAL INSTRUMENTS Hedging of Interest Rate Risk The Company manages its debt portfolio with interest rate swaps from time to time to achieve an overall desired position of fixed and floating rates. Details of outstanding swap agreements as of October 28, 2017 , which are all pay fixed and receive floating, are as follows: Swap Maturity Notional Value (in millions) Pay Fixed Rate Receive Floating Rate Floating Rate Reset Terms June 9, 2019 $ 50.0 0.8725 % One-Month LIBOR Monthly June 24, 2019 $ 50.0 0.7265 % One-Month LIBOR Monthly April 29, 2021 $ 25.0 1.0650 % One-Month LIBOR Monthly April 29, 2021 $ 25.0 0.9260 % One-Month LIBOR Monthly August 3, 2022 $ 120.0 1.7950 % One-Month LIBOR Monthly Interest rate swap agreements are entered into for periods consistent with related underlying exposures and do not constitute positions independent of those exposures. The Company’s interest rate swap agreements are designated as cash flow hedges at October 28, 2017 and are reflected at their fair value of $3.3 million included in "Other Assets" in the Condensed Consolidated Balance Sheet. The Company uses the “Hypothetical Derivative Method” described in Accounting Standards Codification ("ASC") 815 for quarterly prospective and retrospective assessments of hedge effectiveness, as well as for measurements of hedge ineffectiveness. Under this method, the Company assesses the effectiveness of each hedging relationship by comparing the changes in cash flows of the derivative hedging instrument with the changes in cash flows of the designated hedged transactions. The effective portion of changes in the fair value of the derivative is initially reported in other comprehensive income (outside of earnings) and subsequently reclassified to earnings in interest income when the hedged transactions affect earnings. Ineffectiveness resulting from the hedge is recorded as a gain or loss in the condensed consolidated statement of income as part of other income. The Company did not have any hedge ineffectiveness recognized in earnings during the first quarter of fiscal 2018 . The Company also monitors the risk of counterparty default on an ongoing basis and noted that the counterparties are reputable financial institutions. Financial Instruments The following table provides the fair value hierarchy for financial assets and liabilities measured on a recurring basis as of October 28, 2017 and July 29, 2017 : Fair Value at October 28, 2017 Fair Value at July 29, 2017 (In thousands) Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Assets: Interest Rate Swap — $ 3,293 — — $ 2,491 — Liabilities: Interest Rate Swap — — — — (308 ) — The fair value of the Company's other financial instruments including accounts receivable, notes receivable, accounts payable and certain accrued expenses are derived using Level 2 inputs and approximate carrying amounts due to the short-term nature of these instruments. The fair value of notes payable approximate carrying amounts as they are variable rate instruments. The carrying amount of notes payable approximates fair value as interest rates on the credit facility approximates current market rates (Level 2 criteria). The following estimated fair value amounts have been determined by the Company using available market information and appropriate valuation methodologies taking into account the instruments' interest rate, terms, maturity date and collateral, if any, in comparison to the Company's incremental borrowing rate for similar financial instruments and are therefore deemed Level 2 inputs. However, considerable judgment is required in interpreting market data to develop the estimates of fair value. Accordingly, the estimates presented herein are not necessarily indicative of the amounts that the Company could realize in a current market exchange. October 28, 2017 July 29, 2017 (In thousands) Carrying Value Fair Value Carrying Value Fair Value Liabilities: Long-term debt, including current portion $ 159,184 $ 165,652 $ 161,991 $ 169,058 |
TREASURY STOCK (Notes)
TREASURY STOCK (Notes) | 3 Months Ended |
Oct. 28, 2017 | |
Equity, Class of Treasury Stock [Line Items] | |
Treasury Stock [Text Block] | TREASURY STOCK On October 6, 2017, the Company announced that its Board of Directors authorized a share repurchase program for up to $200.0 million of the Company’s outstanding common stock. The repurchase program is scheduled to expire upon the Company’s repurchase of shares of the Company’s common stock having an aggregate purchase price of $200.0 million . Repurchases will be made in accordance with applicable securities laws from time to time in the open market, through privately negotiated transactions, or otherwise. The Company may also implement all or part of the repurchase program pursuant to a plan or plans meeting the conditions of Rule 10b5-1 under the Securities Exchange Act of 1934, as amended. Under this program, the Company purchased 162,073 shares of the Company's common stock at an aggregate cost of $6.4 million in the first quarter of fiscal 2018 . The Company records the repurchase of shares of common stock at cost based on the settlement date of the transaction. These shares are classified as treasury stock, which is a reduction to stockholders’ equity. Treasury stock is included in authorized and issued shares but excluded from outstanding shares. |
BUSINESS SEGMENTS
BUSINESS SEGMENTS | 3 Months Ended |
Oct. 28, 2017 | |
Segment Reporting [Abstract] | |
BUSINESS SEGMENTS | BUSINESS SEGMENTS The Company has several operating divisions aggregated under the wholesale segment, which is the Company’s only reportable segment. These operating divisions have similar products and services, customer channels, distribution methods and historical margins. The wholesale segment is engaged in the national distribution of natural, organic and specialty foods, produce and related products in the United States and Canada. The Company has additional operating divisions that do not meet the quantitative thresholds for reportable segments and are therefore aggregated under the caption of “Other.” “Other” includes a retail division, which engages in the sale of natural foods and related products to the general public through retail storefronts on the east coast of the United States, a manufacturing division, which engages in the importing, roasting, packaging, and distributing of nuts, dried fruit, seeds, trail mixes, granola, natural and organic snack items and confections, the Company’s branded product lines, and the Company's brokerage business, which markets various products on behalf of food vendors directly and exclusively to the Company's customers. “Other” also includes certain corporate operating expenses that are not allocated to operating divisions, which include, among other expenses, stock based compensation, depreciation, and salaries, retainers, and other related expenses of certain officers and all directors. As the Company continues to expand its business and serve its customers through our national platform, these corporate expense amounts have increased, which is the primary driver behind the increasing operating losses within the “Other” category below. Non-operating expenses that are not allocated to the operating divisions are under the caption of “Unallocated (Income)/Expenses.” The Company does not record its revenues for financial reporting purposes by product group, and it is therefore impracticable for the Company to report them accordingly. The following table reflects business segment information for the periods indicated (in thousands): Wholesale Other Eliminations Unallocated (Income)/Expenses Consolidated 13-Week Period Ended October 28, 2017: Net sales $ 2,444,658 $ 57,432 $ (44,545 ) $ — $ 2,457,545 Operating income (loss) 59,956 (4,591 ) (258 ) — 55,107 Interest expense — — — 3,667 3,667 Interest income — — — (91 ) (91 ) Other, net — — — (863 ) (863 ) Income before income taxes 52,394 Depreciation and amortization 21,539 903 — — 22,442 Capital expenditures 4,177 1,080 — — 5,257 Goodwill 352,786 18,025 — — 370,811 Total assets 2,919,476 171,239 (44,403 ) — 3,046,312 13-Week Period Ended October 29, 2016: Net sales $ 2,260,900 $ 57,740 $ (40,276 ) $ — $ 2,278,364 Operating income (loss) 58,663 (5,168 ) (156 ) — 53,339 Interest expense — — — 4,522 4,522 Interest income — — — (99 ) (99 ) Other, net — — — 383 383 Income before income taxes 48,533 Depreciation and amortization 20,691 524 — — 21,215 Capital expenditures 8,355 843 — — 9,198 Goodwill 357,201 18,025 — — 375,226 Total assets 2,771,800 198,915 (27,674 ) — 2,943,041 |
ACCRUED EXPENSES AND OTHER CURR
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Notes) | 3 Months Ended |
Oct. 28, 2017 | |
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES [Abstract] | |
Accounts Payable, Accrued Liabilities, and Other Liabilities Disclosure, Current [Text Block] | ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES Accrued expenses and other current liabilities as of October 28, 2017 and July 29, 2017 consisted of the following (in thousands): October 28, July 29, Accrued salaries and employee benefits $ 49,095 $ 63,937 Workers' compensation and automobile liabilities 22,986 22,774 Interest rate swap liability — 308 Other 92,734 70,224 Total accrued expenses and other current liabilities $ 164,815 $ 157,243 |
NOTES PAYABLE (Notes)
NOTES PAYABLE (Notes) | 3 Months Ended |
Oct. 28, 2017 | |
Debt Disclosure [Abstract] | |
NOTES PAYABLE | NOTES PAYABLE On April 29, 2016, the Company entered into the Third Amended and Restated Loan and Security Agreement (the "Third A&R Credit Agreement") amending and restating certain terms and provisions of its revolving credit facility which increased the maximum borrowings under the amended and restated revolving credit facility and extended the maturity date to April 29, 2021. Up to $850.0 million is available to the Company's U.S. subsidiaries and up to $50.0 million is available to UNFI Canada. After giving effect to the Third A&R Credit Agreement, the amended and restated revolving credit facility provides an option to increase the U.S. or Canadian revolving commitments by up to an additional $600.0 million in the aggregate (but in not less than $10.0 million increments) subject to certain customary conditions and the lenders committing to provide the increase in funding. The borrowings of the U.S. portion of the amended and restated revolving credit facility, after giving effect to the Third A&R Credit Agreement, accrued interest at the base rate plus an applicable margin of 0.25% or LIBOR rate plus an applicable margin of 1.25% for the twelve-month period ended April 29, 2017. After this period, the interest on the U.S. borrowings is accrued at the Company's option, at either (i) a base rate (generally defined as the highest of (x) the Bank of America Business Capital prime rate, (y) the average overnight federal funds effective rate plus one-half percent ( 0.50% ) per annum and (z) one-month LIBOR plus one percent ( 1% ) per annum) plus an applicable margin that varies depending on daily average aggregate availability, or (ii) the LIBOR rate plus an applicable margin that varies depending on daily average aggregate availability. The borrowings on the Canadian portion of the credit facility accrued interest at the Canadian prime rate plus an applicable margin of 0.25% or a bankers' acceptance equivalent rate plus an applicable margin of 1.25% for the twelve-month period ended April 29, 2017. After this period, the borrowings on the Canadian portion of the credit facility accrue interest, at the Company's option, at either (i) a Canadian prime rate (generally defined as the highest of (x) 0.50% over 30-day Reuters Canadian Deposit Offering Rate ("CDOR") for bankers' acceptances, (y) the prime rate of Bank of America, N.A.'s Canada branch, and (z) a bankers' acceptance equivalent rate for a one month interest period plus 1.00%) plus an applicable margin that varies depending on daily average aggregate availability, or (ii) a bankers' acceptance equivalent rate of the rate of interest per annum equal to the annual rates applicable to Canadian Dollar bankers' acceptances on the "CDOR Page" of Reuter Monitor Money Rates Service, plus five basis points, and an applicable margin that varies depending on daily average aggregate availability. Unutilized commitments are subject to an annual fee in the amount of 0.30% if the total outstanding borrowings are less than 25% of the aggregate commitments, or a per annum fee of 0.25% if such total outstanding borrowings are 25% or more of the aggregate commitments. The Company is also required to pay a letter of credit fronting fee to each letter of credit issuer equal to 0.125% per annum of the stated amount of each such letter of credit (or such other amount as may be mutually agreed by the borrowers under the facility and the applicable letter of credit issuer), as well as a fee to all lenders equal to the applicable margin for LIBOR or bankers’ acceptance equivalent rate loans, as applicable, times the average daily stated amount of all outstanding letters of credit. As of October 28, 2017 , the Company's borrowing base, which is calculated based on eligible accounts receivable and inventory levels, net of $4.2 million of reserves, was $882.6 million . As of October 28, 2017 , the Company had $287.8 million of borrowings outstanding under the Company's amended and restated revolving credit facility and $31.0 million in letter of credit commitments which reduced the Company's available borrowing capacity under its revolving credit facility on a dollar for dollar basis. The Company's resulting remaining availability was $563.8 million as of October 28, 2017 . The revolving credit facility, as amended and restated, subjects the Company to a springing minimum fixed charge coverage ratio (as defined in the Third A&R Credit Agreement) of 1.0 to 1.0 calculated at the end of each of our fiscal quarters on a rolling four quarter basis when the adjusted aggregate availability (as defined in the Third A&R Credit Agreement) is less than the greater of (i) $60.0 million and (ii) 10% of the aggregate borrowing base. The Company was not subject to the fixed charge coverage ratio covenant under the Third A&R Credit Agreement during the first quarter of fiscal 2018 . The revolving credit facility also allows for the lenders thereunder to syndicate the credit facility to other banks and lending institutions. The Company has pledged the majority of its and its subsidiaries' accounts receivable and inventory for its obligations under the amended and restated revolving credit facility. |
LONG-TERM DEBT
LONG-TERM DEBT | 3 Months Ended |
Oct. 28, 2017 | |
Debt Disclosure [Abstract] | |
Long-term Debt | LONG-TERM DEBT On August 14, 2014, the Company and certain of its subsidiaries entered into a real estate backed term loan agreement (the "Term Loan Agreement"). The total initial borrowings under the Term Loan Agreement were $150.0 million . The Company is required to make $2.5 million principal payments quarterly, which began on November 1, 2014. Under the Term Loan Agreement, the Company at its option may request the establishment of one or more new term loan commitments in increments of at least $10.0 million , but not to exceed $50.0 million in total, subject to the approval of the lenders electing to participate in such incremental loans and the satisfaction of the conditions required by the Term Loan Agreement. The Company will be required to make quarterly principal payments on these incremental borrowings in accordance with the terms of the Term Loan Agreement. Proceeds from this Term Loan Agreement were used to pay down borrowings on the Company's amended and restated revolving credit facility. On April 29, 2016, the Company entered into a First Amendment Agreement (the “Term Loan Amendment”) to the Term Loan Agreement which amends the Term Loan Agreement. The Term Loan Amendment was entered into to reflect the changes to the amended and restated revolving credit facility reflected in the Third A&R Credit Agreement. The Term Loan Agreement will terminate on the earlier of (a) August 14, 2022 and (b) the date that is ninety days prior to the termination date of the Company’s amended and restated revolving credit agreement, as amended. On September 1, 2016, the Company entered into a Second Amendment Agreement (the "Second Amendment") to the Term Loan Agreement which amends the Term Loan Agreement. The Second Amendment was entered into to adjust the applicable margin charged to borrowings under the Term Loan Agreement. As amended by the Second Amendment, borrowings under the Term Loan Agreement bear interest at rates that, at the Company's option, can be either: (1) a base rate generally defined as the sum of (i) the highest of (x) the administrative agent's prime rate, (y) the average overnight federal funds effective rate plus 0.50% and (z) one-month LIBOR plus one percent ( 1% ) per annum and (ii) a margin of 0.75% ; or, (2) a LIBOR rate generally defined as the sum of (i) LIBOR (as published by Reuters or other commercially available sources) for one, two, three or six months or, if approved by all affected lenders, nine months (all as selected by the Company), and (ii) a margin of 1.75% . Interest accrued on borrowings under the Term Loan Agreement is payable in arrears. Interest accrued on any LIBOR loan is payable on the last day of the interest period applicable to the loan and, with respect to any LIBOR loan of more than three (3) months, on the last day of every three (3) months of such interest period. Interest accrued on base rate loans is payable on the first day of every month. The Company is also required to pay certain customary fees to the administrative agent. The borrowers' obligations under the Term Loan Agreement are secured by certain parcels of the borrowers' real property. The Term Loan Agreement includes financial covenants that require (i) the ratio of the Company’s consolidated EBITDA (as defined in the Term Loan Agreement) minus the unfinanced portion of Capital Expenditures (as defined in the Term Loan Agreement) to the Company’s consolidated Fixed Charges (as defined in the Term Loan Agreement) to be at least 1.20 to 1.00 as of the end of any period of four fiscal quarters, (ii) the ratio of the Company’s Consolidated Funded Debt (as defined in the Term Loan Agreement) to the Company’s EBITDA for the four fiscal quarters most recently ended to be not more than 3.00 to 1.00 as of the end of any fiscal quarter and (iii) the ratio, expressed as a percentage, of the Company’s outstanding principal balance under the Loans (as defined in the Term Loan Agreement), divided by the Mortgaged Property Value (as defined in the Term Loan Agreement) to be not more than 75% at any time. As of October 28, 2017 , the Company was in compliance with the financial covenants of its Term Loan Agreement. As of October 28, 2017 , the Company had borrowings of $116.1 million under the Term Loan Agreement which is included in "Long-term debt" on the Condensed Consolidated Balance Sheet. During the fiscal year ended August 1, 2015, the Company entered into an amendment to an existing lease agreement for the office space utilized as the Company's corporate headquarters in Providence, Rhode Island. The amendment provides for additional office space to be utilized by the Company and extends the lease term for an additional 10 years. The lease qualifies for capital lease treatment pursuant to ASC 840, Leases, and the estimated fair value of the building is recorded on the balance sheet with the capital lease obligation included in long-term debt. A portion of each lease payment reduces the amount of the lease obligation, and a portion is recorded as interest expense at an effective rate of approximately 12.05% . The capital lease obligation as of October 28, 2017 was $12.9 million . The Company recorded $0.4 million of interest expense related to this lease during each of the first quarter s of fiscal 2018 and 2017 . During the fiscal year ended July 28, 2012, the Company entered into a lease agreement for a new distribution facility in Aurora, Colorado. At the conclusion of the fiscal year ended August 3, 2013, actual construction costs exceeded the construction allowance as defined by the lease agreement, and therefore, the Company determined it met the criteria for continuing involvement pursuant to FASB ASC 840, Leases , and applied the financing method to account for this transaction during the fourth quarter of fiscal 2013. Under the financing method, the book value of the distribution facility and related accumulated depreciation remains on the Condensed Consolidated Balance Sheet. The construction allowance is recorded as a financing obligation in "Long-term debt." A portion of each lease payment reduces the amount of the financing obligation, and a portion is recorded as interest expense at an effective rate of approximately 7.32% . The financing obligation as of October 28, 2017 was $30.1 million . The Company recorded $0.6 million of interest expense related to this lease during each of the first quarter s of fiscal 2018 and 2017 . |
SIGNIFICANT ACCOUNTING POLICI19
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Oct. 28, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | (b) Basis of Presentation The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany transactions and balances have been eliminated in consolidation. The accompanying unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the "SEC") for interim financial information, including the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, certain information and note disclosures normally required in complete financial statements prepared in conformity with accounting principles generally accepted in the United States have been condensed or omitted. In the Company’s opinion, these condensed consolidated financial statements include all adjustments necessary for a fair presentation of the financial position, results of operations and cash flows for the interim periods presented. The results of operations for interim periods, however, may not be indicative of the results that may be expected for a full year. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended July 29, 2017 . Net sales consist primarily of sales of natural, organic and specialty products to retailers, adjusted for customer volume discounts, returns, and allowances. Net sales also include amounts charged by the Company to customers for shipping and handling and fuel surcharges. The principal components of cost of sales include the amounts paid to suppliers for product sold, plus the cost of transportation necessary to bring the product to the Company’s distribution facilities, offset by consideration received from suppliers in connection with the purchase or promotion of the suppliers' products. Cost of sales also includes amounts incurred by the Company’s manufacturing subsidiary, United Natural Trading LLC, which does business as Woodstock Farms Manufacturing, for inbound transportation costs offset by consideration received from suppliers in connection with the purchase or promotion of the suppliers’ products. Operating expenses include salaries and wages, employee benefits, warehousing and delivery, selling, occupancy, insurance, administrative, share-based compensation and amortization expense. Operating expenses also include depreciation expense related to the wholesale and retail divisions. Other expense (income) includes interest on outstanding indebtedness, including the financing obligation related to our Aurora, Colorado distribution center and the lease for office space for our corporate headquarters in Providence, Rhode Island, interest income and miscellaneous income and expenses. As noted above, the Company includes shipping and handling fees billed to customers in net sales. Shipping and handling costs associated with inbound freight are generally recorded in cost of sales, whereas shipping and handling costs for selecting, quality assurance, and outbound transportation are recorded in operating expenses. Outbound shipping and handling costs, including allocated employee benefit expenses, totaled $138.0 million and $126.9 million for the first quarter of fiscal 2018 and 2017 , respectively. |
RESTRUCTURING ACTIVITIES AND 20
RESTRUCTURING ACTIVITIES AND ASSET IMPAIRMENTS RESTRUCTURING ACTIVITIES AND ASSET IMPAIRMENTS (Tables) | 3 Months Ended |
Oct. 28, 2017 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Costs [Table Text Block] | The following is a summary of the restructuring costs the Company recorded in fiscal 2017, as well as the remaining liability as of October 28, 2017 (in thousands): Restructuring Costs Recorded in Fiscal 2017 Payments and Other Adjustments Restructuring Cost Liability as of October 28, 2017 Severance and other employee separation and transition costs $ 6,606 $ (3,750 ) $ 2,856 Early lease termination and facility closing costs 258 (258 ) — Total $ 6,864 $ (4,008 ) $ 2,856 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 3 Months Ended |
Oct. 28, 2017 | |
Earnings Per Share [Abstract] | |
Schedule of reconciliation of the weighted average number of shares outstanding used in the computation of the basic and diluted earnings per share | The following is a reconciliation of the basic and diluted number of shares used in computing earnings per share (in thousands): 13-Week Period Ended October 28, October 29, Basic weighted average shares outstanding 50,817 50,475 Net effect of dilutive stock awards based upon the treasury stock method 140 124 Diluted weighted average shares outstanding 50,957 50,599 |
FAIR VALUE MEASUREMENTS OF FI22
FAIR VALUE MEASUREMENTS OF FINANCIAL INSTRUMENTS (Tables) | 3 Months Ended |
Oct. 28, 2017 | |
Fair Value Disclosures [Abstract] | |
Derivative Instruments and Hedging Activities Disclosure [Text Block] | Details of outstanding swap agreements as of October 28, 2017 , which are all pay fixed and receive floating, are as follows: Swap Maturity Notional Value (in millions) Pay Fixed Rate Receive Floating Rate Floating Rate Reset Terms June 9, 2019 $ 50.0 0.8725 % One-Month LIBOR Monthly June 24, 2019 $ 50.0 0.7265 % One-Month LIBOR Monthly April 29, 2021 $ 25.0 1.0650 % One-Month LIBOR Monthly April 29, 2021 $ 25.0 0.9260 % One-Month LIBOR Monthly August 3, 2022 $ 120.0 1.7950 % One-Month LIBOR Monthly |
Fair Value, Assets and Liabilities Measured on Recurring Basis | Fair Value at October 28, 2017 Fair Value at July 29, 2017 (In thousands) Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Assets: Interest Rate Swap — $ 3,293 — — $ 2,491 — Liabilities: Interest Rate Swap — — — — (308 ) — |
Schedule of Carrying Values and Estimated Fair Values of Debt Instruments | October 28, 2017 July 29, 2017 (In thousands) Carrying Value Fair Value Carrying Value Fair Value Liabilities: Long-term debt, including current portion $ 159,184 $ 165,652 $ 161,991 $ 169,058 |
BUSINESS SEGMENTS (Tables)
BUSINESS SEGMENTS (Tables) | 3 Months Ended |
Oct. 28, 2017 | |
Segment Reporting [Abstract] | |
Schedule of business segment information | The following table reflects business segment information for the periods indicated (in thousands): Wholesale Other Eliminations Unallocated (Income)/Expenses Consolidated 13-Week Period Ended October 28, 2017: Net sales $ 2,444,658 $ 57,432 $ (44,545 ) $ — $ 2,457,545 Operating income (loss) 59,956 (4,591 ) (258 ) — 55,107 Interest expense — — — 3,667 3,667 Interest income — — — (91 ) (91 ) Other, net — — — (863 ) (863 ) Income before income taxes 52,394 Depreciation and amortization 21,539 903 — — 22,442 Capital expenditures 4,177 1,080 — — 5,257 Goodwill 352,786 18,025 — — 370,811 Total assets 2,919,476 171,239 (44,403 ) — 3,046,312 13-Week Period Ended October 29, 2016: Net sales $ 2,260,900 $ 57,740 $ (40,276 ) $ — $ 2,278,364 Operating income (loss) 58,663 (5,168 ) (156 ) — 53,339 Interest expense — — — 4,522 4,522 Interest income — — — (99 ) (99 ) Other, net — — — 383 383 Income before income taxes 48,533 Depreciation and amortization 20,691 524 — — 21,215 Capital expenditures 8,355 843 — — 9,198 Goodwill 357,201 18,025 — — 375,226 Total assets 2,771,800 198,915 (27,674 ) — 2,943,041 |
ACCRUED EXPENSES AND OTHER CU24
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES Accrued Expenses and Other Current Liabilities (Tables) | 3 Months Ended |
Oct. 28, 2017 | |
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES [Abstract] | |
Accrued Expenses and Other Current Liabilities [Table Text Block] | Accrued expenses and other current liabilities as of October 28, 2017 and July 29, 2017 consisted of the following (in thousands): October 28, July 29, Accrued salaries and employee benefits $ 49,095 $ 63,937 Workers' compensation and automobile liabilities 22,986 22,774 Interest rate swap liability — 308 Other 92,734 70,224 Total accrued expenses and other current liabilities $ 164,815 $ 157,243 |
SIGNIFICANT ACCOUNTING POLICI25
SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) $ in Millions | 3 Months Ended | |
Oct. 28, 2017 | Oct. 29, 2016 | |
Significant Accounting Policies | ||
Total outbound shipping and handling costs | $ 138 | $ 126.9 |
RECENTLY ISSUED ACCOUNTING PR26
RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Oct. 28, 2017 | Jul. 30, 2017 | Jul. 29, 2017 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Deferred income taxes | $ 40,600 | $ 40,635 | |
Adjustment to Additional Paid in Capital, Income Tax Effect from Share-based Compensation, Net | $ 900 | ||
Cumulative effect of change in accounting principle | $ 509 | ||
Additional Paid-in Capital | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Cumulative effect of change in accounting principle | $ 1,314 |
ACQUISITIONS (Details)
ACQUISITIONS (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Oct. 28, 2017 | Jul. 29, 2017 | Oct. 29, 2016 | Aug. 10, 2016 | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net [Abstract] | ||||
Goodwill | $ 370,811 | $ 371,259 | $ 375,226 | |
Gourmet Guru, Inc. [Member] | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net [Abstract] | ||||
Finite-Lived Customer Relationships, Gross | $ 1,000 | |||
Goodwill | 10,300 | |||
Total purchase price | $ 10,000 | |||
Measurement Period Adjustment, Total purchase price | $ 200 |
RESTRUCTURING ACTIVITIES AND 28
RESTRUCTURING ACTIVITIES AND ASSET IMPAIRMENTS (Details) - 2017 Cost Saving and Efficiency Initiatives [Member] - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Oct. 28, 2017 | Jul. 29, 2017 | |
Restructuring Cost Liability as of October 28, 2017 | ||
Restructuring Charges | $ 6,864 | |
Payments for Restructuring | $ (4,008) | |
Restructuring Reserve | 2,856 | |
Employee Severance [Member] | ||
Restructuring Cost Liability as of October 28, 2017 | ||
Restructuring Charges | 6,606 | |
Payments for Restructuring | (3,750) | |
Restructuring Reserve | 2,856 | |
Facility Closing [Member] | ||
Restructuring Cost Liability as of October 28, 2017 | ||
Restructuring Charges | $ 258 | |
Payments for Restructuring | (258) | |
Restructuring Reserve | $ 0 |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) - shares | 3 Months Ended | |
Oct. 28, 2017 | Oct. 29, 2016 | |
Reconciliation of the basic and diluted number of shares used in computing earnings per share: | ||
Basic weighted average shares outstanding | 50,817,000 | 50,475,000 |
Net effect of dilutive stock awards based upon the treasury stock method | 140,000 | 124,000 |
Diluted weighted average shares outstanding | 50,957,000 | 50,599,000 |
Anti-dilutive share-based payment awards outstanding (in shares) | 155,041 | 48,808 |
FAIR VALUE MEASUREMENTS OF FI30
FAIR VALUE MEASUREMENTS OF FINANCIAL INSTRUMENTS (Details) - USD ($) $ in Thousands | Jun. 24, 2016 | Jun. 09, 2016 | Jan. 23, 2015 | Oct. 28, 2017 | Jul. 29, 2017 |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||||
Interest Rate Derivative Liabilities, at Fair Value | $ 0 | $ (308) | |||
Interest Rate Derivative Assets, at Fair Value | 3,293 | 2,491 | |||
Long term debt, including current portion, carrying value | 159,184 | 161,991 | |||
Long term debt, including current portion, fair value | $ 165,652 | $ 169,058 | |||
Interest Rate Swap January 23, 2015 [Member] | |||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||||
Derivative, Maturity Date | Aug. 3, 2022 | ||||
Derivative, Forward Interest Rate | 1.795% | ||||
Derivative, Notional Amount | $ 120,000 | ||||
Interest Rate Swap June 9, 2016 [Member] | |||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||||
Derivative, Maturity Date | Jun. 9, 2019 | ||||
Derivative, Forward Interest Rate | 0.8725% | ||||
Derivative, Notional Amount | $ 50,000 | ||||
Interest Rate Swap June 9, 2016 [Member] | |||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||||
Derivative, Maturity Date | Apr. 29, 2021 | ||||
Derivative, Forward Interest Rate | 1.065% | ||||
Derivative, Notional Amount | $ 25,000 | ||||
Interest Rate Swap June 24, 2016 [Member] | |||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||||
Derivative, Maturity Date | Jun. 24, 2019 | ||||
Derivative, Forward Interest Rate | 0.7265% | ||||
Derivative, Notional Amount | $ 50,000 | ||||
Interest Rate Swap June 24, 2016 [Member] | |||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||||
Derivative, Maturity Date | Apr. 29, 2021 | ||||
Derivative, Forward Interest Rate | 0.926% | ||||
Derivative, Notional Amount | $ 25,000 |
TREASURY STOCK (Details)
TREASURY STOCK (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Oct. 28, 2017 | Oct. 06, 2017 | |
Treasury Stock [Abstract] | ||
Stock Repurchase Program, Authorized Amount | $ 200,000 | |
Treasury Stock, Shares, Acquired | 162,073 | |
Treasury Stock, Value, Acquired, Cost Method | $ 6,449 |
BUSINESS SEGMENTS (Details)
BUSINESS SEGMENTS (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Oct. 28, 2017 | Oct. 29, 2016 | Jul. 29, 2017 | |
Business segment information | |||
Net sales | $ 2,457,545 | $ 2,278,364 | |
Operating income (loss) | 55,107 | 53,339 | |
Interest expense | 3,667 | 4,522 | |
Interest income | (91) | (99) | |
Other expense (income), net | (863) | 383 | |
Income before income taxes | 52,394 | 48,533 | |
Depreciation and amortization | 22,442 | 21,215 | |
Capital expenditures | 5,257 | 9,198 | |
Goodwill | 370,811 | 375,226 | $ 371,259 |
Total assets | 3,046,312 | 2,943,041 | $ 2,886,563 |
Wholesale | |||
Business segment information | |||
Net sales | 2,444,658 | 2,260,900 | |
Operating income (loss) | 59,956 | 58,663 | |
Interest expense | 0 | 0 | |
Interest income | 0 | 0 | |
Other expense (income), net | 0 | 0 | |
Depreciation and amortization | 21,539 | 20,691 | |
Capital expenditures | 4,177 | 8,355 | |
Goodwill | 352,786 | 357,201 | |
Total assets | 2,919,476 | 2,771,800 | |
Other | |||
Business segment information | |||
Net sales | 57,432 | 57,740 | |
Operating income (loss) | (4,591) | (5,168) | |
Interest expense | 0 | 0 | |
Interest income | 0 | 0 | |
Other expense (income), net | 0 | 0 | |
Depreciation and amortization | 903 | 524 | |
Capital expenditures | 1,080 | 843 | |
Goodwill | 18,025 | 18,025 | |
Total assets | 171,239 | 198,915 | |
Eliminations | |||
Business segment information | |||
Net sales | (44,545) | (40,276) | |
Operating income (loss) | (258) | (156) | |
Interest expense | 0 | 0 | |
Interest income | 0 | 0 | |
Other expense (income), net | 0 | 0 | |
Depreciation and amortization | 0 | 0 | |
Capital expenditures | 0 | 0 | |
Goodwill | 0 | 0 | |
Total assets | (44,403) | (27,674) | |
Unallocated | |||
Business segment information | |||
Net sales | 0 | 0 | |
Operating income (loss) | 0 | 0 | |
Interest expense | 3,667 | 4,522 | |
Interest income | 91 | 99 | |
Other expense (income), net | 863 | (383) | |
Depreciation and amortization | 0 | 0 | |
Capital expenditures | 0 | 0 | |
Goodwill | 0 | 0 | |
Total assets | $ 0 | $ 0 |
ACCRUED EXPENSES AND OTHER CU33
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Details) - USD ($) $ in Thousands | Oct. 28, 2017 | Jul. 29, 2017 |
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES [Abstract] | ||
Accrued salaries and employee benefits | $ 49,095 | $ 63,937 |
Workers' compensation and automobile liabilities | 22,986 | 22,774 |
Interest rate swap liability | 0 | 308 |
Other | 92,734 | 70,224 |
Accrued expenses and other current liabilities | $ 164,815 | $ 157,243 |
NOTES PAYABLE (Details)
NOTES PAYABLE (Details) $ in Thousands | Apr. 30, 2016quarter | Oct. 28, 2017USD ($) | Jul. 29, 2017USD ($) | Apr. 29, 2016USD ($) | May 28, 2014 |
Line of Credit Facility [Line Items] | |||||
Debt Instrument, Fee Amount | 0.125% | ||||
Notes Payable | $ 287,806 | $ 223,612 | |||
CANADA | |||||
Line of Credit Facility [Line Items] | |||||
Maximum Borrowing Base | $ 50,000 | ||||
UNITED STATES | |||||
Line of Credit Facility [Line Items] | |||||
Maximum Borrowing Base | 850,000 | ||||
Minimum | |||||
Line of Credit Facility [Line Items] | |||||
Maximum Borrowing Base | 10,000 | ||||
Maximum | |||||
Line of Credit Facility [Line Items] | |||||
Maximum Borrowing Base | 600,000 | ||||
Amended and restated revolving credit facility | |||||
Line of Credit Facility [Line Items] | |||||
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage | 0.30% | ||||
Debt Instrument, Covenant Fixed Charge Coverage Ratio Minimum, Numerator | 1 | ||||
Debt Instrument, Covenant Fixed Charge Coverage Ratio Minimum, Denominator | 1 | ||||
Line of Credit Facility, Maximum Percentage of Aggregate Availability of the Aggregate Borrowing Base | 10.00% | ||||
Amended and restated revolving credit facility | UNITED STATES | Federal Funds Effective Rate | |||||
Line of Credit Facility [Line Items] | |||||
Debt Instrument, Description of Variable Rate Basis | federal funds effective rate | ||||
Debt Instrument, Basis Spread on Variable Rate | 0.50% | ||||
Amended and restated revolving credit facility | UNITED STATES | LIBOR | |||||
Line of Credit Facility [Line Items] | |||||
Debt Instrument, Description of Variable Rate Basis | LIBOR | ||||
initial applicable margin | 1.25% | ||||
Amended and restated revolving credit facility | UNITED STATES | One-month LIBOR | |||||
Line of Credit Facility [Line Items] | |||||
Debt Instrument, Description of Variable Rate Basis | one-month LIBOR | ||||
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage | 0.25% | ||||
Amended and restated revolving credit facility | UNITED STATES | Reuters Canadian Deposit Offering Rate | |||||
Line of Credit Facility [Line Items] | |||||
Debt Instrument, Description of Variable Rate Basis | Reuters Canadian Deposit Offering Rate ("CDOR") | ||||
Debt Instrument, Basis Spread on Variable Rate | 0.50% | ||||
Amended and restated revolving credit facility | UNITED STATES | Debt Instrument Variable Rate Bankers Acceptance Equivalent for One Month Interest Period [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Debt Instrument, Description of Variable Rate Basis | bankers' acceptance equivalent rate for a one month interest period | ||||
Amended and restated revolving credit facility | Minimum | |||||
Line of Credit Facility [Line Items] | |||||
Line of Credit Facility Percentage of Average Daily Balance of Amount Used | 25.00% | ||||
Line of Credit Facility, Maximum Aggregate Availability of the Aggregate Borrowing Base | $ 60,000 | ||||
Amended and restated revolving credit facility | |||||
Line of Credit Facility [Line Items] | |||||
Debt Instrument, Fixed Charge Coverage Ratio, Number of Quarters | quarter | 4 | ||||
Line of Credit, Amount of Reserves Affecting Current, Borrowing Capacity | 4,200 | ||||
Line of Credit Facility, Current Borrowing Capacity | 882,600 | ||||
Letters of Credit Outstanding, Amount | 31,000 | ||||
Line of Credit Facility, Remaining Borrowing Capacity | $ 563,800 | ||||
Amended and restated revolving credit facility | CANADA | |||||
Line of Credit Facility [Line Items] | |||||
Debt Instrument, Basis Spread on Variable Rate | 0.25% | ||||
Amended and restated revolving credit facility | UNITED STATES | |||||
Line of Credit Facility [Line Items] | |||||
Debt Instrument, Basis Spread on Variable Rate | 0.25% | ||||
Debt Instrument Variable Rate One Month LIBOR [Member] | Amended and restated revolving credit facility | UNITED STATES | |||||
Line of Credit Facility [Line Items] | |||||
Debt Instrument, Basis Spread on Variable Rate | 1.00% | ||||
Debt Instrument, Variable Rate LIBOR [Member] | Amended and restated revolving credit facility | UNITED STATES | |||||
Line of Credit Facility [Line Items] | |||||
Debt Instrument Initial Applicable Margin | 1.25% |
LONG-TERM DEBT (Details)
LONG-TERM DEBT (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Oct. 28, 2017 | Oct. 29, 2016 | Jul. 29, 2017 | Aug. 14, 2014 | |
Long-term debt instrument | ||||
Repayments of Long-term Debt | $ 2,985 | $ 367 | ||
Long term debt, including current portion, carrying value | 159,184 | $ 161,991 | ||
Interest expense | 3,667 | 4,522 | ||
Term loan | ||||
Long-term debt instrument | ||||
Repayments of Long-term Debt | 2,500 | |||
Long term debt, including current portion, carrying value | 116,100 | |||
Capital lease obligation | ||||
Long-term debt instrument | ||||
Interest Expense, Lessee, Assets under Capital Lease | $ 400 | 400 | ||
Lease Term | 10 years | |||
Effective interest rate on debt | 12.05% | |||
Capital Lease Obligation | $ 12,900 | |||
Sale Leaseback Financing Obligation | ||||
Long-term debt instrument | ||||
Long term debt, including current portion, carrying value | $ 30,100 | |||
Effective interest rate on debt | 7.32% | |||
Interest expense | $ 600 | $ 600 | ||
Base Rate [Member] | Term loan | ||||
Long-term debt instrument | ||||
initial applicable margin | 0.75% | |||
Federal Funds Effective Swap Rate [Member] | Term loan | ||||
Long-term debt instrument | ||||
Debt Instrument, Description of Variable Rate Basis | overnight federal funds effective rate | |||
Debt Instrument, Basis Spread on Variable Rate | 0.50% | |||
One-month LIBOR | Term loan | ||||
Long-term debt instrument | ||||
Debt Instrument, Description of Variable Rate Basis | one-month LIBOR | |||
Debt Instrument, Basis Spread on Variable Rate | 1.00% | |||
LIBOR | Term loan | ||||
Long-term debt instrument | ||||
Debt Instrument, Description of Variable Rate Basis | one, two, three or six months or, if approved by all affected lenders, nine months | |||
initial applicable margin | 1.75% | |||
Term loan | ||||
Long-term debt instrument | ||||
Proceeds from borrowings of long-term debt | $ 150,000 | |||
Term loan | Minimum | ||||
Long-term debt instrument | ||||
Proceeds from Issuance of Debt | $ 10,000 | |||
Term loan | Maximum | ||||
Long-term debt instrument | ||||
Proceeds from Issuance of Debt | $ 50,000 |