Unified Grocers Inc., the largest wholesale grocery distributor in the western U.S., has reported an $11.3 million net loss for the company’s third fiscal quarter; that’s compared to earnings of $1.2 million for the same period in 2012, according to the Los Angeles-based cooperative. Losses before patronage dividends and income taxes were $14.6 million for the quarter, compared to earnings of $6.2 million for the same period a year prior.
Several items contributed to the losses, including a charge related to the previously announced early extinguishment of senior secured notes ($9.8 million) as part of a refinancing of the company’s debt. The refinancing provides greater flexibility in day-to-day operations and lowers ongoing borrowing costs, the company says. Unified reports that it also enhanced workers’ compensation reserves to address increased claims exposure ($5.5 million) at its insurance subsidiary and incurred additional lease reserves and equipment disposal costs ($2 million). As a result, year-to-date results for the period ended June 29 show a net loss of $15.9 million compared to net income of $3.3 million in the 2012 period.
“We are a company in transition,” says Bob Ling, president and CEO of Unified Grocers. “The debt refinancing in the third quarter positions the company for growth in fiscal year 2014 and beyond. We are financially sound, we have a solid foundation on which to build and we have a dynamic leadership team in place. We’re seeing improving sales trends and continue to execute on a number of initiatives to achieve our long-term strategy to improve sales and profits for Unified and our owners. The outlook is very positive.”