United Natural Foods, Inc. (NYSE: UNFI), a leading distributor of natural, organic, and conventional products, has announced its financial results for the second quarter of fiscal 2025, covering the 13-week period ending 1st February 2025. The company’s performance highlights its commitment to strategic growth, profitability, and operational efficiency, as well as its continued focus on customer and supplier value creation.

With a 4.9% increase in net sales to $8.2 billion, a 13.3% rise in Adjusted EBITDA, and improved free cash flow, UNFI continues to demonstrate resilience and adaptability in the evolving food distribution landscape.

Let’s dive into the key takeaways from UNFI’s latest quarterly results and what they mean for investors, stakeholders, and the broader food distribution industry.

Second Quarter Fiscal 2025: Key Financial Highlights

UNFI’s second-quarter performance shows solid top-line growth and a steady reduction in net loss, despite ongoing industry challenges. Here’s a breakdown of the key financial metrics:

• Net Sales: $8.2 billion (+4.9% YoY)
• Net Loss: $(3) million, improved from $(15) million in Q2 FY24
• Loss Per Share (EPS): $(0.05), compared to $(0.25) in Q2 FY24
• Adjusted EPS: $0.22, a 214.3% increase from $0.07 in Q2 FY24
• Adjusted EBITDA: $145 million, up 13.3% YoY
• Free Cash Flow: $193 million, reflecting a 66.4% improvement from Q2 FY24

The company has raised its full-year fiscal 2025 outlook for all key financial metrics except capital and cloud implementation expenditures, indicating confidence in sustained growth and operational efficiency.

Operational and Strategic Progress

1. Strengthening Customer and Supplier Partnerships

UNFI’s commitment to enhancing customer and supplier value is a core pillar of its multi-year strategic plan. The company is actively working on:

• A product-focused realignment in its wholesale business to deliver more customized service offerings
• Expanding initiatives that strengthen supplier partnerships, ensuring better product availability and pricing for customers
• Enhancing supply chain efficiency, evidenced by the successful closure of the Fort Wayne distribution centre in February 2025

2. Lean Management Driving Profitability

UNFI’s lean management approach is yielding positive results, reflected in:

• Lower operating expenses as a percentage of net sales (12.6% in Q2 FY25 vs. 13.0% in Q2 FY24)
• A focus on cost-saving initiatives, contributing to higher margins and cash flow improvements
• Deleveraging efforts, with net debt to Adjusted EBITDA declining to 3.7x, a 0.6x reduction over the past 12 months

3. Sustainable Cash Flow and Capital Allocation

UNFI’s strong free cash flow of $193 million in Q2 FY25 underscores its ability to generate cash while managing expenditures effectively. Key financial management strategies include:

• A reduction in outstanding debt, with total net debt standing at $2.05 billion
• Interest expense savings, with Q2 FY25 net interest expense at $38 million, down from $40 million in Q2 FY24
• Maintaining $1.31 billion in liquidity, including $44 million in cash and $1.27 billion in available credit

These measures support future investments in technology, infrastructure, and customer service improvements, ensuring long-term stability and growth.

What’s Next for UNFI? Fiscal 2025 Outlook

Upgraded Full-Year Financial Projections

As a result of its solid first-half performance, UNFI has raised its full-year fiscal 2025 outlook for key financial metrics:

These revised projections reflect UNFI’s confidence in its operational execution, cost efficiencies, and demand trends for natural and organic products.

Continued Execution of Multi-Year Strategy

Looking ahead, UNFI remains focused on:

• Further enhancing product specialization through its wholesale realignment
• Improving supply chain efficiency to drive cost savings and better serve customers
• Identifying new revenue opportunities, particularly within the high-growth natural and organic segment
• Sustaining profitability while maintaining its commitment to deleveraging and cash flow growth

Challenges and Risks to Watch

While UNFI’s performance has been strong, a few external factors could impact future results:

• Inflationary pressures on product pricing and operational costs
• Evolving consumer demand in the natural and organic space
• Macroeconomic conditions, including interest rate fluctuations affecting debt management

However, UNFI’s strategic cost management and strong industry positioning should help mitigate these risks over time.

By Olivier Felicio | Special to IHR Magazine

As trade tensions between Canada and the United States intensify, a new wave of economic patriotism is reshaping consumer habits. With U.S. President Donald Trump imposing fresh tariffs on Canadian goods, consumers are responding with their wallets—actively choosing homegrown products as a form of economic self-preservation and national pride. This shift presents both opportunities and challenges for Canadian retailers and manufacturers, particularly in the natural health sector, where transparency and product sourcing are already top consumer priorities.

Trade Tensions Ignite a Nationwide Shift

On March 4, 2025, the U.S. government implemented a 25% tariff on most Canadian and Mexican imports, escalating an already fraught trade relationship. Trump’s comments about potentially making Canada the 51st U.S. state only added fuel to the fire, prompting widespread consumer backlash.

Recent surveys highlight a significant shift in buying habits:

• 88% of Canadians say they will prioritize purchasing products labeled as “Made in Canada.”
• 42% of consumers report actively avoiding U.S. products.
• 56% of respondents say they would rather stop buying a product altogether than purchase a non-Canadian alternative.

For the natural health industry, this growing consumer loyalty to Canadian-made products is a pivotal moment—one that requires careful strategy to navigate successfully.

The Challenges of a ‘Buy Canadian’ Movement

While consumer sentiment is clear, two major hurdles could impact the long-term sustainability of this movement: cost barriers and labeling confusion.

1. Pricing Pressure: The High Cost of Buying Canadian

Canadian-made products, particularly in the natural health space, often carry a higher price tag. Factors such as domestic labor costs, strict regulatory requirements, and limited economies of scale make it difficult for local manufacturers to compete with cheaper international imports.

The ongoing cost-of-living crisis, which saw grocery prices rise 7.8% in 2023, has already put financial strain on many households. With 71% of Canadians identifying inflation as their top economic concern, convincing consumers to pay a premium for local products will require strategic pricing, bundling, and loyalty incentives.

2. Labeling Confusion: What Does ‘Made in Canada’ Really Mean?

Consumers looking to support Canadian brands face another challenge: distinguishing between “Made in Canada” and “Product of Canada” labels.

• “Made in Canada” means that the final substantial transformation occurs in Canada, but up to 49% of ingredients can be sourced internationally.
• “Product of Canada” means that almost all significant ingredients and processing must be Canadian.

This lack of clarity can cause frustration, particularly in the wellness sector, where ingredient origin is a crucial buying factor. To sustain the “Buy Canadian” movement, clearer labeling regulations and consumer education will be key.

The Industry Response: Natural Health Brands Adapt

As consumer demand for Canadian-made products grows, retailers and manufacturers in the natural health space are taking proactive steps:

• Retailers Are Prioritizing ‘Made in Canada’ Products
  Major grocery and wellness retailers are expanding shelf space for Canadian brands, using in-store signage, digital promotions, and special discounts to highlight domestic products.
• E-Commerce Platforms Are Driving Awareness
  Online marketplaces like Madeinca.ca are making it easier for consumers to find and purchase verified Canadian health and wellness products.
• Loyalty Programs Reward Domestic Purchases
  Retailers are introducing exclusive discounts and promotions for customers who prioritize Canadian-made products.
• Government and Industry Collaboration
  There is mounting pressure on policymakers to support local manufacturing through subsidies, tax breaks, and grants, ensuring domestic producers can scale effectively.

Opportunities for the Natural Health Industry

For businesses in the natural health sector, the “Buy Canadian” movement represents a unique chance to strengthen consumer loyalty and differentiate themselves in a competitive market. Key opportunities include:

1. Brand Positioning – Companies that emphasize Canadian-sourced ingredients and ethical production can build deeper connections with their customer base.
2. Retail Partnerships – Collaborating with Canadian retailers can drive targeted promotions and exclusive product launches.
3. Supply Chain Resilience – Investing in domestic manufacturing can reduce dependency on international supply chains and create long-term sustainability.

Looking Ahead: Is This a Permanent Consumer Shift?

While the current trade tensions may have triggered this wave of economic nationalism, consumer preference for local goods could become a lasting trend—provided businesses address cost concerns and product transparency.

For retailers and manufacturers in the natural health industry, now is the time to capitalize on this shift. With strategic pricing, consumer education, and marketing efforts emphasizing Canadian quality, businesses can strengthen their position in a rapidly evolving marketplace.

The bottom line? Economic patriotism isn’t just a temporary reaction—it’s an opportunity for long-term industry growth.

Olivier Felicio is a business and trade journalist specializing in the natural health and wellness industry. For more insights on industry trends, contact olivier@ihrmagazine.com

The Quebec-based manufacturer, packager, and distributor of USDA-certified organic snacks is embracing digitization to scale operations and boost efficiency, thanks to nearly $1 million in federal funding from Canada Economic Development for Quebec Regions (CED).

With $995,922 in repayable contributions, Frankie’s Organic is modernizing its production lines with cutting-edge robotic equipment, an advanced packaging system, and an intelligent conveyor system. This investment allows the company to streamline its private-label and in-house snack production—ensuring that its products remain gluten-free, GMO-free, and pesticide-free while keeping up with growing demand.

Why This Matters for Health Retailers

For retailers looking to stock high-quality, organic snacks, Frankie’s Organic’s expansion signals greater supply chain reliability and innovation in the industry. As automation enhances efficiency, retailers can expect consistent product availability, improved packaging solutions, and potentially faster turnaround times—key benefits in a market where demand for clean-label, organic snacks is on the rise.

Government Support Fuels SME Growth

Quebec’s economic recovery hinges on regional businesses investing in innovation, and Frankie’s Organic is a prime example. Annie Koutrakis, Member of Parliament for Vimy, emphasized that these investments will strengthen Laval’s economy, while Pascale St-Onge, Minister of Tourism, highlighted how SME-driven innovation fuels broader economic growth.

What’s Next?

With new automation in place, Frankie’s Organic is poised to expand its market reach while staying true to its mission of delivering clean, natural, and transparent snack options. For health retailers, that means a reliable partner in the growing organic food sector—one committed to quality, sustainability, and efficiency.

A New Era of Science-Backed Innovation for Health Retailers

Health retailers, take note: A major opportunity is unfolding in the world of vitamins and supplements. Nature’s Way, a trusted industry leader for over 50 years, has announced the launch of its Innovation Challenge, a platform designed to fund and mentor scientific pioneers in gut health and weight management. This initiative, open to startups, academics, and researchers across Canada and the U.S., could fuel the next big product innovation to hit your shelves.

Why This Matters for Health Retailers

With consumer interest in gut health and GLP-1 weight wellness solutions surging, retailers need to stay ahead of emerging trends. A 2024 poll found that 12% of U.S. adults have used GLP-1 medications, while 60-70 million Americans struggle with digestive issues. This growing demand presents a unique opportunity for health-focused retailers to expand their offerings with science-backed, nature-derived solutions.

Nature’s Way: A Trusted Partner in Innovation

As part of the Schwabe Group, a global leader in phytomedicine, Nature’s Way has a portfolio of over 700 plant-based products—including bestsellers like Sambucus Gummy, voted #1 Product of the Year by Kantar. With a state-of-the-art facility and a team of food scientists, chemists, and microbiologists, the company is uniquely positioned to transform emerging research into retail-ready products.

How to Get Involved

For health retailers looking to align with the latest in scientifically driven wellness, this initiative signals a pipeline of innovative, evidence-based products coming soon. If you work with startups, researchers, or brands pioneering in gut health and weight management, now’s the time to encourage applications to the Innovation Challenge.

Submissions are open on a rolling basis to U.S. and Canadian innovators.

Selected applicants receive funding and expert mentorship to bring their ideas to market.

Health retailers can anticipate next-generation solutions that meet evolving consumer needs.

By championing scientific breakthroughs, Nature’s Way is setting the stage for the next wave of health retail innovation.

As inflationary pressures shift, health retailers must stay agile in pricing and sourcing strategies.

While food inflation in Canada showed signs of moderation in early 2025—driven by restaurant deflation and GST removal—there are emerging concerns that could reverse these trends. From currency fluctuations to potential tariffs, the months ahead may present new challenges for retailers, particularly those reliant on imported goods and health-focused products.

The FX Factor: Currency Woes and Cost Pressures

The Canadian dollar has plunged to its lowest level in two decades, intensifying cost pressures on imported goods. This is particularly concerning for health retailers stocking fresh produce, plant-based products, and specialty supplements. Many essential items—such as organic fruits, nuts, and dietary supplements—are priced in U.S. dollars, meaning a weaker loonie directly translates to higher shelf prices.

Tariffs: A Ticking Time Bomb for Pricing

While Canada and the U.S. have temporarily held off on imposing tariffs, looming trade tensions could push costs higher across key categories. Health-conscious consumers may face rising prices on U.S.-sourced dairy alternatives, protein powders, and packaged functional foods. If tariffs come into play, expect price hikes on everything from imported granola bars to probiotic yogurts.

Commodity Volatility: Coffee, Cocoa, and Oils on the Rise

For retailers in the health and wellness space, rising commodity prices could spell increased costs for key products:

• Coffee: Prices have surged +81% YOY due to extreme droughts in Brazil, impacting organic and specialty coffee brands.
• Cocoa: With a +144% YOY increase, chocolate-based health snacks and protein bars could see notable price adjustments.
• Olive Oil: Though prices are down -54% YOY, they remain elevated, affecting premium health oils and natural skincare products.

How Health Retailers Can Stay Ahead

• Diversify sourcing: Look for alternative suppliers outside the U.S. to mitigate tariff risks.
• Educate consumers: Communicate price changes transparently and highlight cost-effective alternatives.
• Optimize promotions: Offer discounts on bulk purchases or loyalty-based savings to maintain customer engagement.

With inflationary pressures evolving, proactive strategies will be essential for health retailers to navigate 2025’s economic landscape. Stay informed, stay flexible, and prepare for potential cost shifts.

Calcium is the most abundant mineral in the human body, yet most supplements still rely on rock-based sources that offer poor absorption and sustainability concerns. With growing consumer demand for cleaner, more effective, and eco-conscious ingredients, the calcium supplement market is overdue for innovation—enter Vegan Minerals.

The company has launched Calcea, a 100% plant-based, sustainable calcium ingredient designed for supplements, food, and pet nutrition. Unlike traditional calcium derived from limestone, Calcea offers superior bioavailability, delivering calcium, magnesium, over 70 essential trace minerals, and 16 amino acids in a naturally occurring, plant-based form. Its honeycomb structure enhances absorption, ensuring consumers receive real health benefits.

With over 75% of consumers scrutinizing ingredient lists before purchasing, brands must adapt to this new era of transparency. “Most people assume their calcium supplement is natural and effective, but they’d be shocked to learn where it comes from,” says Jordan Golshan, co-founder of Vegan Minerals.

By partnering with forward-thinking brands, Vegan Minerals is paving the way for a clean-label revolution in nutrition. As the plant-based movement continues to grow, Calcea is set to redefine mineral supplementation for generations to come.

Why Health Retailers Should Take Note

• Consumers are actively seeking natural, science-backed supplements.
• Sustainability sells—eco-conscious shoppers prefer plant-based alternatives.
• Bioavailability matters—Calcea’s superior absorption meets modern health demands.

What Makes DigeSEB Sport™ a Game-Changer?

DigeSEB Sport™ is an innovative blend of proteolytic enzymes, five probiotic strains, and a prebiotic, uniquely designed to enhance protein digestion and optimize nutrient absorption. Whether for elite athletes or everyday fitness enthusiasts, this formulation helps maximize the benefits of a high-protein diet while supporting gut health and muscle recovery.

Clinically Proven Benefits

Supported by two peer-reviewed clinical studies published in 2024, DigeSEB Sport™ has been shown to:

• Enhance the release and absorption of branched-chain amino acids (BCAAs) and essential amino acids
• Support a healthy gut microbiome
• Promote the production of postbiotics such as GABA and β-alanine, which aid in muscle relaxation and endurance

Why Non-GMO Project Verification Matters

The Non-GMO Project Verification is a widely respected certification that assures consumers a product has been thoroughly evaluated for genetically modified organisms (GMOs). With demand for clean-label supplements growing, this verification further establishes DigeSEB Sport™ as a trusted, high-quality choice for athletes and health-conscious consumers.

“With the growing demand for clean-label products, we collaborate closely with our customers to offer effective solutions that meet their consumers’ needs,” said Vic Rathi, CEO and Founder of Specialty Enzymes & Probiotics. “Partnering with The Non-GMO Project underscores our commitment to transparency, providing consumers with confidence in the quality and integrity of our ingredients.”

A New Standard in Sports Nutrition

DigeSEB Sport™ is more than just an enzyme supplement—it is a clinically validated, clean-label solution designed to enhance the way athletes fuel their bodies. As interest in digestive support for high-protein diets continues to rise, this innovation positions Specialty Enzymes & Probiotics as a leader in functional sports nutrition.

BodyHealth has teamed up with Miami Heat All-Star Bam Adebayo to introduce a NSF Sport-certified supplement line, designed to support athletic performance, muscle recovery, and overall wellness.

At the center of this launch is Perfect Amino®, a scientifically formulated essential amino acid supplement, now NSF Certified for Sport®—guaranteeing it’s free from banned substances and safe for athletes. This makes it an ideal choice for fitness enthusiasts, professional athletes, and health-conscious individuals alike.

Alongside Perfect Amino, Adebayo incorporates Reds and Greens into his routine—two nutrient-dense formulas designed to enhance energy, immunity, and overall health. While not part of the NSF-certified line, these products provide premium-quality nutrition to support a balanced lifestyle.

Why Retailers Should Take Note

With the rising demand for clean, science-backed supplements, this partnership positions BodyHealth as a go-to brand for trusted sports nutrition. Adebayo’s endorsement enhances credibility, making these products a must-have for your shelves.

Stock up on BodyHealth’s high-performance supplements today and help your customers achieve peak fitness, recovery, and wellness—just like the pros.