UNFI expects up to 400million sales decline due to recent cyber attack

United Natural Foods said a data security incident it suffered last month could have a substantial financial impact on the company’s performance for fiscal 2025, potentially leading to a decline in net sales of an estimated $350 to $400 million.

 

On June 5, UNFI discovered a data security incident that forced the company to take parts of its critical system offline, resulting in disruptions to its supply chain operations.

 

“The incident has caused, and is expected to continue to cause, temporary disruptions to the Company’s business operations,” UNFI said in its SEC filing.

 

In a separate filing with the SEC, UNFI said that its management believes the incident is likely to have a material impact on the Company’s net income or loss and adjusted EBITDA for the fourth quarter of fiscal 2025 compared to its internal projections prior to the incident.

 

In a recent update, UNFI said that it anticipates a significant decline in net sales for fiscal 2025.

 

“The Company estimates that the cyber incident will impact fiscal 2025 net sales by approximately $350 to $400 million, net (loss) income by $50 to $60 million, which includes the estimated tax impact, and adjusted EBITDA by approximately $40 to $50 million,” 

 

“These estimates do not reflect the benefit of anticipated insurance proceeds, which the Company expects will be adequate for the incident. The Company does not currently expect a meaningful operational or financial impact beyond the fourth quarter of fiscal 2025 aside from insurance reimbursement,” UNFI said in its business update.

 

UNFI has restored its core system that is used by customers and suppliers for electronic ordering and invoicing, which has enabled business operations to normalise.

 

“In the weeks following the incident, the Company experienced reduced sales volume and increased operational costs as the Company worked to drive solutions-oriented results for its customers. The Company has also incurred, and expects to continue to incur, direct expenses related to the investigation and remediation of the incident,” UNFI added.