Cover
Cover - shares | 6 Months Ended | |
Jan. 29, 2022 | Mar. 04, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jan. 29, 2022 | |
Document Transition Report | false | |
Entity File Number | 001-15723 | |
Entity Registrant Name | UNITED NATURAL FOODS, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 05-0376157 | |
Entity Address, Address Line One | 313 Iron Horse Way, | |
Entity Address, City or Town | Providence, | |
Entity Address, State or Province | RI | |
Entity Address, Postal Zip Code | 02908 | |
City Area Code | 401 | |
Local Phone Number | 528-8634 | |
Title of 12(b) Security | Common stock, par value $0.01 | |
Trading Symbol | UNFI | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 58,265,075 | |
Entity Central Index Key | 0001020859 | |
Current Fiscal Year End Date | --07-30 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) - USD ($) $ in Millions | Jan. 29, 2022 | Jul. 31, 2021 |
ASSETS | ||
Cash and cash equivalents | $ 45 | $ 41 |
Accounts receivable, net | 1,241 | 1,103 |
Inventories, net | 2,426 | 2,247 |
Prepaid expenses and other current assets | 152 | 157 |
Current assets of discontinued operations | 0 | 2 |
Total current assets | 3,864 | 3,550 |
Property and equipment, net | 1,764 | 1,784 |
Operating lease assets | 1,097 | 1,064 |
Goodwill | 20 | 20 |
Intangible assets, net | 855 | 891 |
Deferred income taxes | 42 | 57 |
Other long-term assets | 159 | 157 |
Long-term assets of discontinued operations | 0 | 2 |
Total assets | 7,801 | 7,525 |
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||
Accounts payable | 1,737 | 1,644 |
Accrued expenses and other current liabilities | 328 | 341 |
Accrued compensation and benefits | 223 | 243 |
Current portion of operating lease liabilities | 145 | 135 |
Current portion of long-term debt and finance lease liabilities | 122 | 120 |
Current liabilities of discontinued operations | 0 | 4 |
Total current liabilities | 2,555 | 2,487 |
Long-term debt | 2,309 | 2,175 |
Long-term operating lease liabilities | 988 | 962 |
Long-term finance lease liabilities | 30 | 35 |
Pension and other postretirement benefit obligations | 21 | 53 |
Other long-term liabilities | 215 | 299 |
Total liabilities | 6,118 | 6,011 |
Commitments and contingencies | ||
Stockholders’ equity: | ||
Preferred stock, $0.01 par value, authorized 5.0 shares; none issued or outstanding | 0 | 0 |
Common stock, $0.01 par value, authorized 100.0 shares; 58.8 shares issued and 58.2 shares outstanding at January 29, 2022; 57.0 shares issued and 56.4 shares outstanding at July 31, 2021 | 1 | 1 |
Additional paid-in capital | 596 | 599 |
Treasury stock at cost | (24) | (24) |
Accumulated other comprehensive loss | (9) | (39) |
Retained earnings | 1,120 | 978 |
Total United Natural Foods, Inc. stockholders’ equity | 1,684 | 1,515 |
Noncontrolling interests | (1) | (1) |
Total stockholders’ equity | 1,683 | 1,514 |
Total liabilities and stockholders’ equity | $ 7,801 | $ 7,525 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) (Parenthetical) - $ / shares | Jan. 29, 2022 | Jul. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, shares issued (in shares) | 58,800,000 | 57,000,000 |
Common stock, shares outstanding (in shares) | 58,200,000 | 56,400,000 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jan. 29, 2022 | Jan. 30, 2021 | Jan. 29, 2022 | Jan. 30, 2021 | |
Income Statement [Abstract] | ||||
Net sales | $ 7,416 | $ 6,900 | $ 14,413 | $ 13,584 |
Cost of sales | 6,341 | 5,905 | 12,296 | 11,619 |
Gross profit | 1,075 | 995 | 2,117 | 1,965 |
Operating expenses | 944 | 870 | 1,876 | 1,774 |
Restructuring, acquisition and integration related expenses | 5 | 18 | 8 | 34 |
Loss on sale of assets | 1 | 0 | 1 | 0 |
Operating income | 125 | 107 | 232 | 157 |
Net periodic benefit income, excluding service cost | (10) | (17) | (20) | (34) |
Interest expense, net | 44 | 51 | 84 | 120 |
Other, net | (2) | (2) | (1) | (3) |
Income from continuing operations before income taxes | 93 | 75 | 169 | 74 |
Provision for income taxes | 25 | 17 | 24 | 16 |
Net income from continuing operations | 68 | 58 | 145 | 58 |
Income from discontinued operations, net of tax | 0 | 3 | 0 | 3 |
Net income including noncontrolling interests | 68 | 61 | 145 | 61 |
Less net income attributable to noncontrolling interests | (2) | (2) | (3) | (3) |
Net income attributable to United Natural Foods, Inc. | $ 66 | $ 59 | $ 142 | $ 58 |
Basic earnings per share: | ||||
Continuing operations (in dollars per share) | $ 1.13 | $ 1.01 | $ 2.47 | $ 0.99 |
Discontinued operations (in dollars per share) | 0 | 0.04 | 0 | 0.05 |
Basic earnings per share (in dollars per share) | 1.13 | 1.05 | 2.47 | 1.04 |
Diluted earnings per share: | ||||
Continuing operations (in dollars per share) | 1.08 | 0.96 | 2.33 | 0.93 |
Discontinued operations (in dollars per share) | 0 | 0.04 | 0 | 0.05 |
Diluted earnings per share (in dollars per share) | $ 1.08 | $ 1 | $ 2.33 | $ 0.98 |
Weighted average shares outstanding: | ||||
Basic (in shares) | 58.3 | 56.1 | 57.6 | 55.7 |
Diluted (in shares) | 61 | 59.2 | 61 | 59.1 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (unaudited) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jan. 29, 2022 | Jan. 30, 2021 | Jan. 29, 2022 | Jan. 30, 2021 | ||
Statement of Comprehensive Income [Abstract] | |||||
Net income including noncontrolling interests | $ 68 | $ 61 | $ 145 | $ 61 | |
Other comprehensive income (loss): | |||||
Recognition of pension and other postretirement benefit obligations, net of tax | 1 | (1) | 2 | (1) | |
Recognition of interest rate swap cash flow hedges, net of tax | [1] | 15 | 10 | 28 | 22 |
Foreign currency translation adjustments | (2) | 3 | (2) | 3 | |
Recognition of other cash flow derivatives, net of tax | [2] | 1 | 0 | 2 | 0 |
Total other comprehensive income | 15 | 12 | 30 | 24 | |
Less comprehensive income attributable to noncontrolling interests | (2) | (2) | (3) | (3) | |
Total comprehensive income attributable to United Natural Foods, Inc. | $ 81 | $ 71 | $ 172 | $ 82 | |
[1] | Amounts are net of tax expense of $6 million, $3 million, $10 million and $7 million, respectively. | ||||
[2] | Amounts are net of tax expense of $1 million, $0 million, $1 million and $0 million, respectively. |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (unaudited) (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jan. 29, 2022 | Jan. 30, 2021 | Jan. 29, 2022 | Jan. 30, 2021 | |
Statement of Comprehensive Income [Abstract] | ||||
Recognition of interest rate swap cash flow hedges, tax expense (benefit) | $ 6 | $ 3 | $ 10 | $ 7 |
Recognition of other cash flow derivatives, tax expense (benefit) | $ 1 | $ 0 | $ 1 | $ 0 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (unaudited) - USD ($) shares in Millions, $ in Millions | Total | Cumulative effect of change in accounting principle | Common Stock | Treasury Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Loss | Retained Earnings | Retained EarningsCumulative effect of change in accounting principle | Total United Natural Foods, Inc. Stockholders’ Equity | Total United Natural Foods, Inc. Stockholders’ EquityCumulative effect of change in accounting principle | Noncontrolling Interests |
Beginning balance (in shares) at Aug. 01, 2020 | 55.3 | 0.6 | |||||||||
Beginning balance at Aug. 01, 2020 | $ 1,142 | $ (9) | $ 1 | $ (24) | $ 569 | $ (239) | $ 838 | $ (9) | $ 1,145 | $ (9) | $ (3) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||
Restricted stock vestings (in shares) | 1.5 | ||||||||||
Restricted stock vestings | (11) | (11) | (11) | ||||||||
Share-based compensation | 23 | 23 | 23 | ||||||||
Other comprehensive income (loss) | 24 | 24 | 24 | ||||||||
Distributions to noncontrolling interests | (1) | (1) | |||||||||
Net income | 61 | 58 | 58 | 3 | |||||||
Ending balance (in shares) at Jan. 30, 2021 | 56.8 | 0.6 | |||||||||
Ending balance at Jan. 30, 2021 | 1,229 | $ 1 | $ (24) | 581 | (215) | 887 | 1,230 | (1) | |||
Beginning balance (in shares) at Oct. 31, 2020 | 56.7 | 0.6 | |||||||||
Beginning balance at Oct. 31, 2020 | 1,148 | $ 1 | $ (24) | 572 | (227) | 828 | 1,150 | (2) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||
Restricted stock vestings (in shares) | 0.1 | ||||||||||
Restricted stock vestings | (2) | (2) | (2) | ||||||||
Share-based compensation | 11 | 11 | 11 | ||||||||
Other comprehensive income (loss) | 12 | 12 | 12 | ||||||||
Distributions to noncontrolling interests | (1) | (1) | |||||||||
Net income | 61 | 59 | 59 | 2 | |||||||
Ending balance (in shares) at Jan. 30, 2021 | 56.8 | 0.6 | |||||||||
Ending balance at Jan. 30, 2021 | $ 1,229 | $ 1 | $ (24) | 581 | (215) | 887 | 1,230 | (1) | |||
Beginning balance (in shares) at Jul. 31, 2021 | 56.4 | 57 | 0.6 | ||||||||
Beginning balance at Jul. 31, 2021 | $ 1,514 | $ 1 | $ (24) | 599 | (39) | 978 | 1,515 | (1) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||
Restricted stock vestings (in shares) | 1.8 | ||||||||||
Restricted stock vestings | (35) | (35) | (35) | ||||||||
Share-based compensation | 23 | 23 | 23 | ||||||||
Other comprehensive income (loss) | 30 | 30 | 30 | ||||||||
Distributions to noncontrolling interests | (3) | (3) | |||||||||
Proceeds from issuance of common stock, net | 9 | 9 | 9 | ||||||||
Net income | $ 145 | 142 | 142 | 3 | |||||||
Ending balance (in shares) at Jan. 29, 2022 | 58.2 | 58.8 | 0.6 | ||||||||
Ending balance at Jan. 29, 2022 | $ 1,683 | $ 1 | $ (24) | 596 | (9) | 1,120 | 1,684 | (1) | |||
Beginning balance (in shares) at Oct. 30, 2021 | 58.7 | 0.6 | |||||||||
Beginning balance at Oct. 30, 2021 | 1,587 | $ 1 | $ (24) | 582 | (24) | 1,054 | 1,589 | (2) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||||
Restricted stock vestings (in shares) | 0.1 | ||||||||||
Restricted stock vestings | (2) | (2) | (2) | ||||||||
Share-based compensation | 12 | 12 | 12 | ||||||||
Other comprehensive income (loss) | 15 | 15 | 15 | ||||||||
Distributions to noncontrolling interests | (1) | (1) | |||||||||
Proceeds from issuance of common stock, net | 4 | 4 | 4 | ||||||||
Net income | $ 68 | 66 | 66 | 2 | |||||||
Ending balance (in shares) at Jan. 29, 2022 | 58.2 | 58.8 | 0.6 | ||||||||
Ending balance at Jan. 29, 2022 | $ 1,683 | $ 1 | $ (24) | $ 596 | $ (9) | $ 1,120 | $ 1,684 | $ (1) |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) - USD ($) $ in Millions | 6 Months Ended | |
Jan. 29, 2022 | Jan. 30, 2021 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income including noncontrolling interests | $ 145 | $ 61 |
Income from discontinued operations, net of tax | 0 | 3 |
Net income from continuing operations | 145 | 58 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 138 | 144 |
Share-based compensation | 23 | 23 |
Loss on sale of assets | (1) | 0 |
Closed property and other restructuring charges | 1 | 3 |
Net pension and other postretirement benefit income | (20) | (34) |
Deferred income tax benefit | 0 | (1) |
LIFO charge | 30 | 13 |
Provision (recoveries) for losses on receivables | 1 | (4) |
Non-cash interest expense and other adjustments | 15 | 39 |
Changes in operating assets and liabilities | (291) | (34) |
Net cash provided by operating activities | 43 | 207 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Payments for capital expenditures | (106) | (92) |
Proceeds from dispositions of assets | 3 | 41 |
Payments for investments | (26) | 0 |
Net cash used in investing activities of continuing operations | (129) | (51) |
Net cash provided by investing activities of discontinued operations | 0 | 1 |
Net cash used in investing activities | (129) | (50) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from borrowings of long-term debt | 0 | 500 |
Proceeds from borrowings under revolving credit line | 2,521 | 2,666 |
Repayments of borrowings under revolving credit line | (2,232) | (2,538) |
Repayments of long-term debt and finance leases | (168) | (769) |
Proceeds from the issuance of common stock and exercise of stock options | 9 | 0 |
Payment of employee restricted stock tax withholdings | (35) | (10) |
Payments for debt issuance costs | (1) | (10) |
Distributions to noncontrolling interests | (3) | (1) |
Other | 0 | (1) |
Net cash provided by (used in) financing activities | 91 | (163) |
EFFECT OF EXCHANGE RATE ON CASH | 0 | 0 |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 5 | (6) |
Cash and cash equivalents, at beginning of period | 40 | 47 |
Cash and cash equivalents, at end of period | 45 | 41 |
Supplemental disclosures of cash flow information: | ||
Cash paid for interest | 67 | 75 |
Cash payments for federal, state, and foreign income taxes, net | 0 | 43 |
Leased assets obtained in exchange for new operating lease liabilities | 123 | 117 |
Leased assets obtained in exchange for new finance lease liabilities | 1 | 0 |
Additions of property and equipment included in Accounts payable | $ 16 | $ 31 |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jan. 29, 2022 | |
Accounting Policies [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES | NOTE 1—SIGNIFICANT ACCOUNTING POLICIES Nature of Business United Natural Foods, Inc. and its subsidiaries (the “Company”, “we”, “us”, “UNFI”, or “our”) is a leading distributor of natural, organic, specialty, produce and conventional grocery and non-food products, and provider of support services to retailers. The Company sells its products primarily throughout the United States and Canada. Fiscal Year The Company’s fiscal years end on the Saturday closest to July 31 and contain either 52 or 53 weeks. References to the second quarter of fiscal 2022 and 2021 relate to the 13-week fiscal quarters ended January 29, 2022 and January 30, 2021, respectively. References to fiscal 2022 and 2021 year-to-date relate to the 26-week fiscal periods ended January 29, 2022 and January 30, 2021, respectively. Basis of Presentation The accompanying unaudited Condensed Consolidated Financial Statements include the accounts of the Company and its subsidiaries. All significant intercompany transactions and balances have been eliminated in consolidation. Unless otherwise indicated in these Condensed Consolidated Financial Statements, references to the Condensed Consolidated Statements of Operations, the Condensed Consolidated Balance Sheets and the Notes to the Condensed Consolidated Financial Statements exclude all amounts related to discontinued operations. 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 (“GAAP”) 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. However, the results of operations for interim periods 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 31, 2021 (the “Annual Report”). There were no material changes in significant accounting policies from those described in the Annual Report. Discontinued Operations In the fourth quarter of fiscal 2021, the Company determined it no longer met the held for sale criterion for a probable sale to be completed within 12 months for two of the four stores that were previously included within discontinued operations. As a result, the Company revised its Condensed Consolidated Financial Statements to reclassify two Shoppers stores from discontinued operations to continuing operations. The prior period presented in the Condensed Consolidated Financial Statements have been conformed to the current period presentation. The remaining two stores included in discontinued operations were sold in the second quarter of fiscal 2022. Use of Estimates The preparation of the Condensed Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Cash and Cash Equivalents Cash equivalents consist of highly liquid investments with original maturities of three months or less. The Company’s banking arrangements allow it to fund outstanding checks when presented to the financial institution for payment. The Company funds all intraday bank balance overdrafts during the same business day. Checks outstanding in excess of bank balances create book overdrafts, which are recorded in Accounts payable in the Condensed Consolidated Balance Sheets and are reflected as an operating activity in the Condensed Consolidated Statements of Cash Flows. As of January 29, 2022 and July 31, 2021, the Company had net book overdrafts of $292 million and $268 million, respectively. Reclassifications Within the Condensed Consolidated Financial Statements certain immaterial amounts have been reclassified to conform with current year presentation. These reclassifications had no impact on reported net income, cash flows, or total assets and liabilities. Inventories, Net |
RECENTLY ADOPTED AND ISSUED ACC
RECENTLY ADOPTED AND ISSUED ACCOUNTING PRONOUNCEMENTS | 6 Months Ended |
Jan. 29, 2022 | |
Accounting Standards Update and Change in Accounting Principle [Abstract] | |
RECENTLY ADOPTED AND ISSUED ACCOUNTING PRONOUNCEMENTS | NOTE 2—RECENTLY ADOPTED AND ISSUED ACCOUNTING PRONOUNCEMENTS Recently Adopted Accounting Pronouncements In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes . ASU 2019-12 eliminates certain exceptions to Topic 740’s general principles. The amendments also improve consistency in and simplify its application. The Company adopted this standard in the first quarter of fiscal 2022. The adoption of this standard did not have a material impact on the Company’s Condensed Consolidated Financial Statements. Recently Issued Accounting Pronouncements In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting |
REVENUE RECOGNITION
REVENUE RECOGNITION | 6 Months Ended |
Jan. 29, 2022 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE RECOGNITION | NOTE 3—REVENUE RECOGNITION Disaggregation of Revenues The Company records revenue to five customer channels within Net sales, which are described below: • Chains , which consists of customer accounts that typically have more than 10 operating stores and excludes stores included within the Supernatural and Other channels defined below; • Independent retailers , which includes smaller size accounts, including single store and multiple store locations, and group purchasing entities that are not classified within Chains above or Other discussed below; • Supernatural , which consists of chain accounts that are national in scope and carry primarily natural products, and currently consists solely of Whole Foods Market; • Retail , which reflects our Retail segment, including Cub Foods and Shoppers stores, excluding Shoppers stores that were held for sale within discontinued operations; and • Other , which includes international customers outside of Canada, foodservice, eCommerce, conventional military business and other sales. The following tables detail the Company’s net sales for the periods presented by customer channel for each of its segments. The Company does not record its revenues within its Wholesale reportable segment for financial reporting purposes by product group, and it is therefore impracticable for it to report them accordingly. Net Sales for the 13-Week Period Ended (in millions) January 29, 2022 Customer Channel Wholesale Retail Other Eliminations (1) Consolidated Chains $ 3,243 $ — $ — $ — $ 3,243 Independent retailers 1,905 — — — 1,905 Supernatural 1,453 — — — 1,453 Retail — 643 — — 643 Other 531 — 50 — 581 Eliminations — — — (409) (409) Total $ 7,132 $ 643 $ 50 $ (409) $ 7,416 Net Sales for the 13-Week Period Ended (in millions) January 30, 2021 Customer Channel Wholesale Retail Other Eliminations (1) Consolidated Chains $ 3,106 $ — $ — $ — $ 3,106 Independent retailers 1,701 — — — 1,701 Supernatural 1,298 — — — 1,298 Retail — 633 — — 633 Other 513 — 55 — 568 Eliminations — — — (406) (406) Total $ 6,618 $ 633 $ 55 $ (406) $ 6,900 Net Sales for the 26-Week Period Ended (in millions) January 29, 2022 Customer Channel Wholesale Retail Other Eliminations (1) Consolidated Chains $ 6,325 $ — $ — $ — $ 6,325 Independent retailers 3,655 — — — 3,655 Supernatural 2,831 — — — 2,831 Retail — 1,245 — — 1,245 Other 1,055 — 106 — 1,161 Eliminations — — — (804) (804) Total $ 13,866 $ 1,245 $ 106 $ (804) $ 14,413 Net Sales for the 26-Week Period Ended (in millions) January 30, 2021 Customer Channel Wholesale Retail Other Eliminations (1) Consolidated Chains $ 6,133 $ — $ — $ — $ 6,133 Independent retailers 3,373 — — — 3,373 Supernatural 2,512 — — — 2,512 Retail — 1,239 — — 1,239 Other 1,038 — 111 — 1,149 Eliminations — — — (822) (822) Total $ 13,056 $ 1,239 $ 111 $ (822) $ 13,584 (1) Eliminations primarily includes the net sales elimination of Wholesale’s sales to the Retail segment and the elimination of sales from segments included within Other to Wholesale. The Company serves customers in the United States and Canada, as well as customers located in other countries. However, all of the Company’s revenue is earned in the United States and Canada, and international distribution occurs through freight-forwarders. The Company does not have any performance obligations on international shipments subsequent to delivery to the domestic port. Accounts and Notes Receivable Balances Accounts and notes receivable are as follows: (in millions) January 29, 2022 July 31, 2021 Customer accounts receivable $ 1,254 $ 1,115 Allowance for uncollectible receivables (29) (28) Other receivables, net 16 16 Accounts receivable, net $ 1,241 $ 1,103 Notes receivable, net, included within Prepaid expenses and other current assets $ 7 $ 7 Long-term notes receivable, net, included within Other long-term assets $ 13 $ 15 |
RESTRUCTURING, ACQUISITION, AND
RESTRUCTURING, ACQUISITION, AND INTEGRATION RELATED EXPENSES | 6 Months Ended |
Jan. 29, 2022 | |
Restructuring and Related Activities [Abstract] | |
RESTRUCTURING, ACQUISITION, AND INTEGRATION RELATED EXPENSES | NOTE 4—RESTRUCTURING, ACQUISITION AND INTEGRATION RELATED EXPENSES Restructuring, acquisition and integration related expenses were as follows: 13-Week Period Ended 26-Week Period Ended (in millions) January 29, 2022 January 30, 2021 January 29, 2022 January 30, 2021 Restructuring and integration costs $ 4 $ 14 $ 7 $ 29 Closed property charges and costs 1 4 1 5 Total $ 5 $ 18 $ 8 $ 34 |
GOODWILL AND INTANGIBLE ASSETS,
GOODWILL AND INTANGIBLE ASSETS, NET | 6 Months Ended |
Jan. 29, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND INTANGIBLE ASSETS, NET | NOTE 5—GOODWILL AND INTANGIBLE ASSETS, NET Changes in the carrying value of Goodwill by reportable segment that have goodwill consisted of the following: (in millions) Wholesale Other Total Goodwill as of July 31, 2021 $ 10 (1) $ 10 (2) $ 20 Change in foreign exchange rates — — — Goodwill as of January 29, 2022 $ 10 (1) $ 10 (2) $ 20 (1) Wholesale amounts are net of accumulated goodwill impairment charges of $717 million as of July 31, 2021 and January 29, 2022. (2) Other amounts are net of accumulated goodwill impairment charges of $10 million as of July 31, 2021 and January 29, 2022. Identifiable intangible assets, net consisted of the following: January 29, 2022 July 31, 2021 (in millions) Gross Carrying Accumulated Net Gross Carrying Accumulated Net Amortizing intangible assets: Customer relationships $ 1,007 $ 264 $ 743 $ 1,007 $ 234 $ 773 Pharmacy prescription files 33 15 18 33 13 20 Operating lease intangibles 7 5 2 7 4 3 Trademarks and tradenames 84 48 36 84 45 39 Total amortizing intangible assets 1,131 332 799 1,131 296 835 Indefinite lived intangible assets: Trademarks and tradenames 56 — 56 56 — 56 Intangibles assets, net $ 1,187 $ 332 $ 855 $ 1,187 $ 296 $ 891 Amortization expense was $18 million and $19 million for the second quarters of fiscal 2022 and 2021, respectively, and $36 million and $42 million for fiscal 2022 and 2021 year-to-date, respectively. The estimated future amortization expense for each of the next five fiscal years and thereafter on definite lived intangible assets existing as of January 29, 2022 is as follows: Fiscal Year: (in millions) Remaining fiscal 2022 $ 36 2023 72 2024 72 2025 70 2026 66 Thereafter 483 $ 799 |
FAIR VALUE MEASUREMENTS OF FINA
FAIR VALUE MEASUREMENTS OF FINANCIAL INSTRUMENTS | 6 Months Ended |
Jan. 29, 2022 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS OF FINANCIAL INSTRUMENTS | NOTE 6—FAIR VALUE MEASUREMENTS OF FINANCIAL INSTRUMENTS Recurring Fair Value Measurements The following tables provide the fair value hierarchy for financial assets and liabilities measured on a recurring basis: Condensed Consolidated Balance Sheets Location Fair Value at January 29, 2022 (in millions) Level 1 Level 2 Level 3 Assets: Fuel derivatives designated as hedging instruments Prepaid expenses and other current assets $ — $ 2 $ — Foreign currency derivatives designated as hedging instruments Prepaid expenses and other current assets $ — $ 1 $ — Mutual funds Other long-term assets $ 1 $ — $ — Liabilities: Interest rate swaps designated as hedging instruments Accrued expenses and other current liabilities $ — $ 24 $ — Interest rate swaps designated as hedging instruments Other long-term liabilities $ — $ 15 $ — Condensed Consolidated Balance Sheets Location Fair Value at July 31, 2021 (in millions) Level 1 Level 2 Level 3 Assets: Fuel derivatives designated as hedging instruments Prepaid expenses and other current assets $ — $ 1 $ — Mutual funds Other long-term assets $ 2 $ — $ — Liabilities: Foreign currency derivatives designated as hedging instruments Accrued expenses and other current liabilities $ — $ 1 $ — Interest rate swaps designated as hedging instruments Accrued expenses and other current liabilities $ — $ 33 $ — Interest rate swaps designated as hedging instruments Other long-term liabilities $ — $ 42 $ — Interest Rate Swap Contracts The fair values of interest rate swap contracts are measured using Level 2 inputs. The interest rate swap contracts are valued using an income approach interest rate swap valuation model incorporating observable market inputs including interest rates, LIBOR swap rates and credit default swap rates. As of January 29, 2022, a 100 basis point increase in forward LIBOR interest rates would increase the fair value of the interest rate swaps by approximately $24 million; a 100 basis point decrease in forward LIBOR interest rates would decrease the fair value of the interest rate swaps by approximately $25 million. Refer to Note 7—Derivatives for further information on interest rate swap contracts. Fair Value Estimates For certain of the Company’s financial instruments including cash and cash equivalents, receivables, accounts payable, accrued vacation, compensation and benefits, and other current assets and liabilities the fair values approximate carrying amounts due to their short maturities. The fair value of notes receivable is estimated by using a discounted cash flow approach prior to consideration for uncollectible amounts and is calculated by applying a market rate for similar instruments using Level 3 inputs. The fair value of debt is estimated based on market quotes, where available, or market values for similar instruments, using Level 2 and 3 inputs. In the table below, the carrying value of the Company’s long-term debt is net of original issue discounts and debt issuance costs. January 29, 2022 July 31, 2021 (in millions) Carrying Value Fair Value Carrying Value Fair Value Notes receivable, including current portion $ 25 $ 22 $ 29 $ 26 Long-term debt, including current portion $ 2,323 $ 2,394 $ 2,188 $ 2,278 |
DERIVATIVES
DERIVATIVES | 6 Months Ended |
Jan. 29, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVES | NOTE 7—DERIVATIVES Management of Interest Rate Risk The Company enters into interest rate swap contracts from time to time to mitigate its exposure to changes in market interest rates as part of its overall strategy to manage its debt portfolio to achieve an overall desired position of notional debt amounts subject to fixed and floating interest rates. Interest rate swap contracts 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 contracts are designated as cash flow hedges as of January 29, 2022. Interest rate swap contracts are reflected at their fair values in the Condensed Consolidated Balance Sheets. Refer to Note 6—Fair Value Measurements of Financial Instruments for further information on the fair value of interest rate swap contracts. Details of active swap contracts as of January 29, 2022, which are all pay fixed and receive floating, are as follows: Effective Date Swap Maturity Notional Value (in millions) Pay Fixed Rate Receive Floating Rate (2) Floating Rate Reset Terms August 3, 2015 (1) August 15, 2022 $ 31 1.7950 % One-Month LIBOR Monthly October 26, 2018 October 31, 2022 100 2.8915 % One-Month LIBOR Monthly January 11, 2019 October 31, 2022 50 2.4678 % One-Month LIBOR Monthly January 23, 2019 October 31, 2022 50 2.5255 % One-Month LIBOR Monthly November 16, 2018 March 31, 2023 150 2.8950 % One-Month LIBOR Monthly January 23, 2019 March 31, 2023 50 2.5292 % One-Month LIBOR Monthly November 30, 2018 September 30, 2023 50 2.8315 % One-Month LIBOR Monthly October 26, 2018 October 31, 2023 100 2.9210 % One-Month LIBOR Monthly January 11, 2019 March 28, 2024 100 2.4770 % One-Month LIBOR Monthly January 23, 2019 March 28, 2024 100 2.5420 % One-Month LIBOR Monthly November 30, 2018 October 31, 2024 100 2.8480 % One-Month LIBOR Monthly January 11, 2019 October 31, 2024 100 2.5010 % One-Month LIBOR Monthly January 24, 2019 October 31, 2024 50 2.5210 % One-Month LIBOR Monthly October 26, 2018 October 22, 2025 50 2.9550 % One-Month LIBOR Monthly November 16, 2018 October 22, 2025 50 2.9590 % One-Month LIBOR Monthly November 16, 2018 October 22, 2025 50 2.9580 % One-Month LIBOR Monthly January 24, 2019 October 22, 2025 50 2.5558 % One-Month LIBOR Monthly $ 1,231 (1) The swap contract has an amortizing notional principal amount which is reduced by $1 million on a quarterly basis. (2) For these swap contracts that are indexed to LIBOR, the Company is monitoring and evaluating risks related to the expected future cessation of LIBOR. In fiscal 2021 year-to-date, in conjunction with the $500 million fixed rate senior unsecured notes offering described below in Note 8—Long-Term Debt, the Company paid $11 million to terminate or novate certain outstanding interest rate swaps with a notional amount of $504 million and certain forward starting interest rate swaps with a notional amount of $450 million. The payments equaled the fair value of the interest rate swaps at the time of their termination or novation. No gain or loss was recorded as a result of the swap terminations and novations. Since the hedged interest payments remain probable of occurring, the unrecognized gains and losses that existed as of the early termination or novation of these interest rate swap agreements will be amortized out of Accumulated other comprehensive loss and into Interest expense, net over the remaining period of the original terminated or novated interest rate swap agreements. If any of the hedged interest payments were not probable of occurring, then a charge representing an accelerated amortization of the unrecognized gains and losses would be recorded. Cash payments resulting from the termination or novation of interest rate swaps are classified as operating activities in the Company’s Condensed Consolidated Statements of Cash Flows. The Company performs an initial quantitative assessment of hedge effectiveness using the “Hypothetical Derivative Method” in the period in which the hedging transaction is entered. 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. In future reporting periods, the Company performs a qualitative analysis for quarterly prospective and retrospective assessments of hedge effectiveness. The Company also monitors the risk of counterparty default on an ongoing basis and noted that the counterparties are reputable financial institutions. The entire change in the fair value of the derivative is initially reported in Other comprehensive income (outside of earnings) in the Condensed Consolidated Statements of Comprehensive Income and subsequently reclassified to earnings in Interest expense, net in the Condensed Consolidated Statements of Operations when the hedged transactions affect earnings. The location and amount of gains or losses recognized in the Condensed Consolidated Statements of Operations for interest rate swap contracts for each of the periods, presented on a pretax basis, are as follows: 13-Week Period Ended 26-Week Period Ended January 29, 2022 January 30, 2021 January 29, 2022 January 30, 2021 (in millions) Interest expense, net Interest expense, net Total amounts of expense line items presented in the Condensed Consolidated Statements of Operations in which the effects of cash flow hedges are recorded $ 44 $ 51 $ 84 $ 120 Loss on cash flow hedging relationships: Loss reclassified from comprehensive income into earnings $ (10) $ (12) $ (21) $ (24) |
LONG-TERM DEBT
LONG-TERM DEBT | 6 Months Ended |
Jan. 29, 2022 | |
Debt Disclosure [Abstract] | |
LONG-TERM DEBT | NOTE 8—LONG-TERM DEBT The Company’s long-term debt consisted of the following: (in millions) Average Interest Rate at January 29, 2022 Fiscal Maturity Year January 29, July 31, Term Loan Facility 3.35% 2026 $ 844 $ 1,002 ABL Credit Facility 1.54% 2024 990 701 Senior Notes 6.75% 2029 500 500 Other secured loans 5.14% 2024-2025 30 37 Debt issuance costs, net (28) (35) Original issue discount on debt (13) (17) Long-term debt, including current portion 2,323 2,188 Less: current portion of long-term debt (14) (13) Long-term debt $ 2,309 $ 2,175 Senior Notes On October 22, 2020, the Company issued $500 million of unsecured 6.750% Senior Notes due October 15, 2028 (the “Senior Notes”). The Senior Notes are guaranteed by each of the Company’s subsidiaries that are borrowers under or that guarantee the ABL Credit Facility (defined below) or the Term Loan Facility (defined below). ABL Credit Facility The ABL Loan Agreement by and among the Company and United Natural Foods West, Inc. (together with the Company, the “U.S. Borrowers”) and UNFI Canada, Inc. (the “Canadian Borrower” and, together with the U.S. Borrowers, the “Borrowers”), the financial institutions that are parties thereto as lenders (collectively, the “ABL Lenders”), Bank of America, N.A. as administrative agent for the ABL Lenders, Bank of America, N.A. (acting through its Canada branch), as Canadian agent for the ABL Lenders, and the other parties thereto, provides for a secured asset-based revolving credit facility (the “ABL Credit Facility” and the loans thereunder, the “ABL Loans”), of which up to (i) $2,050 million is available to the U.S. Borrowers and (ii) $50 million is available to the Canadian Borrower. The ABL Loan Agreement also provides for (i) a $300 million sublimit of availability for letters of credit of which there is a further $25 million sublimit for the Canadian Borrower. Under the ABL Loan Agreement, the Borrowers may, at their option, increase the aggregate amount of the ABL Credit Facility in an amount of up to $600 million without the consent of any ABL Lenders not participating in such increase, subject to certain customary conditions and applicable lenders committing to provide the increase in funding. There is no assurance that additional funding would be available. The Borrowers’ obligations under the ABL Credit Facility are guaranteed by most of the Company’s wholly-owned subsidiaries (collectively, the “Guarantors”), subject to customary exceptions and limitations. The Borrowers’ obligations under the ABL Credit Facility and the Guarantors’ obligations under the related guarantees are secured by (i) a first-priority lien on all of the Borrowers’ and Guarantors’ accounts receivable, inventory and certain other assets arising therefrom or related thereto (including substantially all of their deposit accounts, collectively, the “ABL Assets”) and (ii) a second-priority lien on all of the Borrowers’ and Guarantors’ assets that do not constitute ABL Assets, in each case, subject to customary exceptions and limitations. Availability under the ABL Credit Facility is subject to a borrowing base (the “Borrowing Base”), which is based on 90% of eligible accounts receivable, plus 90% of eligible credit card receivables, plus 90% of the net orderly liquidation value of eligible inventory, plus 90% of eligible pharmacy receivables, plus certain pharmacy prescription files availability of the Borrowers, after adjusting for customary reserves, but at no time shall exceed the lesser of the aggregate commitments under the ABL Credit Facility (currently $2,100 million) or the Borrowing Base. The assets included in the Condensed Consolidated Balance Sheets securing the outstanding obligations under the ABL Credit Facility on a first-priority basis, and the unused credit and fees under the ABL Credit Facility, were as follows: Assets securing the ABL Credit Facility (in millions) (1) : January 29, July 31, Certain inventory assets included in Inventories, net and Current assets of discontinued operations $ 2,454 $ 2,297 Certain receivables included in Accounts receivable, net and Current assets of discontinued operations $ 1,158 $ 1,041 (1) The ABL Credit Facility is also secured by all of the Company’s pharmacy prescription files, which are included in Intangibles, net in the Condensed Consolidated Balance Sheets. Refer to Note 5—Goodwill and Intangible Assets, Net for additional information. As of January 29, 2022, the U.S. Borrowers’ Borrowing Base, net of $178 million of reserves, was $2,439 million, which is above the $2,050 million limit of availability to the U.S. Borrowers under the ABL Credit Facility. As of January 29, 2022, the Canadian Borrower’s Borrowing Base, net of $5 million of reserves, was $46 million, which is below the $50 million limit of availability to the Canadian Borrower under the ABL Credit facility, resulting in total availability of $2,096 million for ABL Loans and letters of credit under the ABL Credit Facility. As of January 29, 2022, the U.S. Borrowers had $990 million of ABL Loans and the Canadian Borrower had no ABL Loans outstanding under the ABL Credit Facility, which are presented net of debt issuance costs of $6 million and are included in Long-term debt on the Condensed Consolidated Balance Sheets. As of January 29, 2022, the U.S. Borrowers had $115 million in letters of credit and the Canadian Borrower had no letters of credit outstanding under the ABL Credit Facility. The Company’s resulting remaining availability under the ABL Credit Facility was $991 million as of January 29, 2022. ABL availability (in millions): January 29, 2022 Total availability for ABL Loans and letters of credit $ 2,096 ABL Loans $ 990 Letters of credit $ 115 Unused credit $ 991 The applicable interest rates, letter of credit fees and unutilized commitment fees under the ABL Credit Facility are variable and are dependent upon the prior fiscal quarter’s daily Average Availability (as defined in the ABL Agreement), and were as follows: Interest rates and fees under the ABL Credit Facility: Range of Facility Rates and Fees (per annum) January 29, 2022 U.S. and Canadian Borrowers’ applicable margin for base rate loans —% - 0.50% 0.25 % U.S. and Canadian Borrowers’ applicable margin for LIBOR and BA loans (1) 1.00% - 1.50% 1.25 % Unutilized commitment fees 0.25% - 0.375% 0.25 % Letter of credit fees 1.125% - 1.625% 1.375 % (1) The U.S. Borrowers utilize LIBOR-based loans and the Canadian Borrower utilizes bankers’ acceptance rate-based loans. The ABL Loan Agreement contains provisions for the transition to an alternative rate of interest in the event that LIBOR is no longer available. Term Loan Facility The Term Loan Agreement, by and among the Company and Supervalu (collectively, the “Term Borrowers”), the financial institutions that are parties thereto as lenders, Credit Suisse, as administrative agent for the Lenders, and the other parties thereto, provides for senior secured first lien term loans in an initial aggregate principal amount of $1,800 million in a seven-year tranche (the “Term Loan Facility”). The loans under the Term Loan Facility will be payable in full on October 22, 2025. Under the Term Loan Agreement, the Company may, at its option, increase the amount of the Term Loan Facility, add one or more additional tranches of term loans or add one or more additional tranches of revolving credit commitments, without the consent of any Term Lenders not participating in such additional borrowings, up to an aggregate amount of $656 million plus additional amounts based on satisfaction of certain leverage ratio tests, subject to certain customary conditions and applicable lenders committing to provide the additional funding. There can be no assurance that additional funding would be available. The obligations under the Term Loan Facility are guaranteed by the Guarantors, subject to customary exceptions and limitations. The Term Borrowers’ obligations under the Term Loan Facility and the Guarantors’ obligations under the related guarantees are secured by (i) a first-priority lien on substantially all of the Term Borrowers’ and the Guarantors’ assets other than the ABL Assets and (ii) a second-priority lien on substantially all of the Term Borrowers’ and the Guarantors’ ABL Assets, in each case, subject to customary exceptions and limitations, including an exception for owned real property with net book values of less than $10 million. As of January 29, 2022 and July 31, 2021, there was $668 million and $676 million, respectively, of owned real property pledged as collateral that was included in Property and equipment, net in the Condensed Consolidated Balance Sheets. The Company must prepay loans outstanding under the Term Loan Facility no later than 130 days after the fiscal year end in an aggregate principal amount equal to a specified percentage (which percentage ranges from 0 to 75 percent depending on the Consolidated First Lien Net Leverage Ratio as of the last day of such fiscal year) of Excess Cash Flow (as defined in the Term Loan Agreement), minus certain types of voluntary prepayments of indebtedness made during such fiscal year. Based on the Company’s Consolidated First Lien Net Leverage Ratio at the end of fiscal 2021, no prepayment from Excess Cash Flow in fiscal 2021 is required to be made in fiscal 2022. The potential amount of prepayment from Excess Cash Flow in fiscal 2022 that may be required in fiscal 2023 is not reasonably estimable as of January 29, 2022. As of January 29, 2022, the Company had borrowings of $844 million outstanding under the Term Loan Facility, which are presented in the Condensed Consolidated Balance Sheets net of debt issuance costs of $15 million and an original issue discount on debt of $12 million. As of January 29, 2022, no amount of the Term Loan Facility was classified as current. As of January 29, 2022, the borrowings under the Term Loan Facility bear interest at rates that, at the Term Borrowers’ option, can be either: (i) a base rate plus a margin of 2.25% or (ii) a LIBOR rate plus a margin of 3.25%; provided that the LIBOR rate shall never be less than 0.0%. The Term Loan Agreement contains provisions for the establishment of an alternative rate of interest in the event that LIBOR is no longer available. On November 10, 2021, the Company entered into an amendment (the “Second Term Loan Amendment”) amending the Term Loan Agreement. The amendment provides for (i) the reduction of the applicable margin for LIBOR loans from 3.50% to 3.25% and the applicable margin for base rate loans from 2.50% to 2.25%, and (ii) other administrative changes. The amendment did not change the aggregate amount or maturity date of the Term Loan Facility. In conjunction with the Second Term Loan Amendment, the Company made a voluntary prepayment of $150 million on the Term Loan Facility funded with incremental borrowings under the ABL Credit Facility that reduces its interest costs. This prepayment will count towards any requirement to prepay the Term Loan Facility from Excess Cash Flow (as defined in the Term Loan Agreement) generated during fiscal 2022, which would be due in fiscal 2023. In connection with this prepayment, the Company incurred a loss on debt extinguishment of $5 million related to unamortized debt issuance costs and a loss on unamortized original issue discount, which was recorded within Interest expense, net in the second quarter of fiscal 2022. Subsequent to the end of the second quarter of fiscal 2022, in March 2022, the Company made a $44 million voluntary prepayment on the Term Loan Facility from the majority of the anticipated after-tax net proceeds from the transactions described further in Note 16—Subsequent Events. |
COMPREHENSIVE INCOME AND ACCUMU
COMPREHENSIVE INCOME AND ACCUMULATED OTHER COMPREHENSIVE LOSS | 6 Months Ended |
Jan. 29, 2022 | |
Equity [Abstract] | |
COMPREHENSIVE INCOME AND ACCUMULATED OTHER COMPREHENSIVE LOSS | NOTE 9—COMPREHENSIVE INCOME AND ACCUMULATED OTHER COMPREHENSIVE LOSS Changes in Accumulated other comprehensive loss by component, net of tax, for fiscal 2022 year-to-date are as follows: (in millions) Other Cash Flow Derivatives Benefit Plans Foreign Currency Translation Swap Agreements Total Accumulated other comprehensive income (loss) at July 31, 2021 $ — $ 37 $ (16) $ (60) $ (39) Other comprehensive income (loss) before reclassifications 1 — (2) 13 12 Amortization of amounts included in net periodic benefit income — 2 — — 2 Amortization of cash flow hedges 1 — — 15 16 Net current period Other comprehensive income (loss) 2 2 (2) 28 30 Accumulated other comprehensive income (loss) at January 29, 2022 $ 2 $ 39 $ (18) $ (32) $ (9) Changes in Accumulated other comprehensive loss by component, net of tax, for fiscal 2021 year-to-date are as follows: (in millions) Benefit Plans Foreign Currency Translation Swap Agreements Total Accumulated other comprehensive loss at August 1, 2020 $ (116) $ (21) $ (102) $ (239) Other comprehensive income before reclassifications — 3 5 8 Amortization of amounts included in net periodic benefit income (1) — — (1) Amortization of cash flow hedges — — 17 17 Net current period Other comprehensive (loss) income (1) 3 22 24 Accumulated other comprehensive loss at January 30, 2021 $ (117) $ (18) $ (80) $ (215) Items reclassified out of Accumulated other comprehensive loss had the following impact on the Condensed Consolidated Statements of Operations: 13-Week Period Ended 26-Week Period Ended Affected Line Item on the Condensed Consolidated Statements of Operations (in millions) January 29, January 30, January 29, January 30, Pension and postretirement benefit plan net assets: Amortization of amounts included in net periodic benefit income (1) $ 1 $ (1) $ 2 $ (1) Net periodic benefit income, excluding service cost Income tax (benefit) expense — — — — Provision for income taxes Total reclassifications, net of tax $ 1 $ (1) $ 2 $ (1) Swap agreements: Reclassification of cash flow hedges $ 10 $ 12 $ 21 $ 24 Interest expense, net Income tax benefit (3) (4) (6) (7) Provision for income taxes Total reclassifications, net of tax $ 7 $ 8 $ 15 $ 17 Other cash flow hedges: Reclassification of cash flow hedge $ 2 $ — $ 2 $ — Cost of sales Income tax benefit (1) — (1) — Provision for income taxes Total reclassification, net of tax $ 1 $ — $ 1 $ — (1) Reclassification of amounts included in net periodic benefit income include reclassification of prior service cost and reclassification of net actuarial loss as reflected in Note 11—Benefit Plans. |
SHARE-BASED AWARDS
SHARE-BASED AWARDS | 6 Months Ended |
Jan. 29, 2022 | |
Share-Based Awards [Abstract] | |
SHARE-BASED AWARDS | NOTE 10—SHARE-BASED AWARDS In fiscal 2022 year-to-date, the Company granted restricted stock units and performance share units to its directors, executive officers and certain employees representing a right to receive an aggregate of 1.1 million shares. As of January 29, 2022, there were 2.9 million shares available for issuance under the Amended and Restated 2020 Equity Incentive Plan. |
BENEFIT PLANS
BENEFIT PLANS | 6 Months Ended |
Jan. 29, 2022 | |
Retirement Benefits [Abstract] | |
BENEFIT PLANS | NOTE 11—BENEFIT PLANS Net periodic benefit income and contributions to defined benefit pension and other post-retirement benefit plans consisted of the following: 13-Week Period Ended Pension Benefits Other Postretirement Benefits (in millions) January 29, 2022 January 30, 2021 January 29, 2022 January 30, 2021 Net Periodic Benefit (Income) Cost Interest cost $ 9 $ 9 $ — $ 1 Expected return on plan assets (20) (26) — — Amortization of prior service cost (credit) — — 1 (1) Amortization of net actuarial loss (gain) — 1 — (1) Net periodic benefit (income) cost $ (11) $ (16) $ 1 $ (1) Contributions to benefit plans $ — $ (1) $ (1) $ (1) 26-Week Period Ended Pension Benefits Other Postretirement Benefits (in thousands) January 29, 2022 January 30, 2021 January 29, 2022 January 30, 2021 Net Periodic Benefit (Income) Cost Interest cost $ 19 $ 18 $ — $ 1 Expected return on plan assets (41) (52) — — Amortization of prior service cost (credit) — — 2 (1) Amortization of net actuarial loss (gain) — 1 — (1) Net periodic benefit (income) cost $ (22) $ (33) $ 2 $ (1) Contributions to benefit plans $ — $ (1) $ (2) $ (2) Defined Benefit Plan Merger In the second quarter of fiscal 2022, the Company merged the Unified Grocers, Inc. Cash Balance Plan into the SUPERVALU INC. Retirement Plan. The merger did not impact the amount of plan assets and accumulated benefit plan obligations; however, as a result of the merger, former Unified Grocers, Inc. Cash Balance Plan participants will receive all benefits from the SUPERVALU INC. Retirement Plan. As such, the funded status of the remaining plan in the Condensed Consolidated Balance Sheets has been presented within a single asset balance within Other long-term assets. Pension Contributions No minimum pension contributions are required to be made under the SUPERVALU INC. Retirement Plan under the Employee Retirement Income Security Act of 1974, as amended, (“ERISA”) in fiscal 2022. The Company expects to contribute approximately $2 million and $3 million, respectively, to its other non-qualified pension plans and postretirement benefit plans in fiscal 2022. Multiemployer Pension Plans The Company contributed $11 million and $12 million in the second quarters of fiscal 2022 and 2021, respectively, and $22 million and $24 million in fiscal 2022 and 2021 year-to-date, respectively, to multiemployer pension plans. |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Jan. 29, 2022 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 12—INCOME TAXES The effective tax rate for the second quarter of fiscal 2022 was 26.9% compared to 22.7% for the second quarter of fiscal 2021. The change in the effective tax rate was primarily driven by a tax benefit in the second quarter of fiscal 2021 from the release of reserves for unrecognized tax positions. The effective tax rate for fiscal 2022 year-to-date was 14.2% compared to 21.6% for fiscal 2021 year-to-date primarily driven by discrete tax benefits from employee stock award vestings that occurred in fiscal 2022 year-to-date. The impacts from the release of unrecognized tax positions in fiscal 2022 year-to-date were comparable to fiscal 2021 year-to-date. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 6 Months Ended |
Jan. 29, 2022 | |
Earnings Per Share [Abstract] | |
EARNINGS (LOSS) PER SHARE | NOTE 13—EARNINGS PER SHARE The following is a reconciliation of the basic and diluted number of shares used in computing earnings per share: 13-Week Period Ended 26-Week Period Ended (in millions, except per share data) January 29, January 30, January 29, January 30, Basic weighted average shares outstanding 58.3 56.1 57.6 55.7 Net effect of dilutive stock awards based upon the treasury stock method 2.7 3.1 3.4 3.4 Diluted weighted average shares outstanding 61.0 59.2 61.0 59.1 Basic earnings per share: Continuing operations $ 1.13 $ 1.01 $ 2.47 $ 0.99 Discontinued operations $ — $ 0.04 $ — $ 0.05 Basic earnings per share $ 1.13 $ 1.05 $ 2.47 $ 1.04 Diluted earnings per share: Continuing operations $ 1.08 $ 0.96 $ 2.33 $ 0.93 Discontinued operations $ — $ 0.04 $ — $ 0.05 Diluted earnings per share $ 1.08 $ 1.00 $ 2.33 $ 0.98 Anti-dilutive stock-based awards excluded from the calculation of diluted earnings per share 0.4 1.1 0.9 1.2 |
BUSINESS SEGMENTS
BUSINESS SEGMENTS | 6 Months Ended |
Jan. 29, 2022 | |
Segment Reporting [Abstract] | |
BUSINESS SEGMENTS | NOTE 14—BUSINESS SEGMENTS The Company has two reportable segments: Wholesale and Retail. These reportable segments are two distinct businesses, each with a different customer base, marketing strategy and management structure. The Wholesale reportable segment is the aggregation of two operating segments: U.S. Wholesale and Canada Wholesale. The U.S. Wholesale and Canada Wholesale operating segments have similar products and services, customer channels, distribution methods and economic characteristics. Reportable segments are reviewed on an annual basis, or more frequently if events or circumstances indicate a change in reportable segments has occurred. The following table provides continuing operations information by reportable segment, including Net sales, Adjusted EBITDA with a reconciliation to Income from continuing operations before income taxes, depreciation and amortization, and payments for capital expenditures: 13-Week Period Ended 26-Week Period Ended (in millions) January 29, 2022 January 30, 2021 January 29, 2022 January 30, 2021 Net sales: Wholesale (1) $ 7,132 $ 6,618 $ 13,866 $ 13,056 Retail 643 633 1,245 1,239 Other 50 55 106 111 Eliminations (409) (406) (804) (822) Total Net sales $ 7,416 $ 6,900 $ 14,413 $ 13,584 Continuing Operations Adjusted EBITDA: Wholesale $ 159 $ 188 $ 323 $ 311 Retail 30 26 52 51 Other 12 (8) 16 (4) Eliminations — (2) (1) 4 Adjustments: Net income attributable to noncontrolling interests 2 2 3 3 Net periodic benefit income, excluding service cost 10 17 20 34 Interest expense, net (44) (51) (84) (120) Other, net 2 2 1 3 Depreciation and amortization (69) (67) (138) (144) Share-based compensation (12) (13) (23) (27) Restructuring, acquisition and integration related expenses (5) (18) (8) (34) Loss on sale of assets (1) — (1) — Multi-employer pension plan withdrawal benefit 8 — 8 — Other retail benefit (expense) 1 (1) 1 (3) Income from continuing operations before income taxes $ 93 $ 75 $ 169 $ 74 Depreciation and amortization: Wholesale $ 61 $ 59 $ 122 $ 127 Retail 8 7 15 14 Other — 1 1 3 Total depreciation and amortization $ 69 $ 67 $ 138 $ 144 Payments for capital expenditures: Wholesale $ 46 $ 46 $ 98 $ 84 Retail 4 5 8 8 Total capital expenditures $ 50 $ 51 $ 106 $ 92 (1) As presented in Note 3—Revenue Recognition, for the second quarters of fiscal 2022 and 2021, the Company recorded $356 million and $354 million, respectively, and $695 million and $719 million in fiscal 2022 and 2021 year-to-date, respectively, within Net sales in its Wholesale reportable segment attributable to Wholesale sales to its Retail segment that have been eliminated upon consolidation. Total assets of continuing operations by reportable segment were as follows: (in millions) January 29, July 31, Assets: Wholesale $ 6,851 $ 6,536 Retail 597 566 Other 397 462 Eliminations (44) (43) Total assets of continuing operations $ 7,801 $ 7,521 |
COMMITMENTS, CONTINGENCIES AND
COMMITMENTS, CONTINGENCIES AND OFF-BALANCE SHEET ARRANGEMENTS | 6 Months Ended |
Jan. 29, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS, CONTINGENCIES AND OFF-BALANCE SHEET ARRANGEMENTS | NOTE 15—COMMITMENTS, CONTINGENCIES AND OFF-BALANCE SHEET ARRANGEMENTS Guarantees and Contingent Liabilities The Company has outstanding guarantees related to certain leases, fixture financing loans and other debt obligations of various retailers as of January 29, 2022. These guarantees were generally made to support the business growth of wholesale customers. The guarantees are generally for the entire terms of the leases, fixture financing loans or other debt obligations with remaining terms that range from less than one year to eight years, with a weighted average remaining term of approximately five years. For each guarantee issued, if the wholesale customer or other third-party defaults on a payment, the Company would be required to make payments under its guarantee. Generally, the guarantees are secured by indemnification agreements or personal guarantees. The Company reviews performance risk related to its guarantee obligations based on internal measures of credit performance. As of January 29, 2022, the maximum amount of undiscounted payments the Company would be required to make in the event of default of all guarantees was $25 million ($22 million on a discounted basis). Based on the indemnification agreements, personal guarantees and results of the reviews of performance risk, as of January 29, 2022, a total estimated loss of $1 million is recorded in the Condensed Consolidated Balance Sheets. The Company is a party to a variety of contractual agreements under which it may be obligated to indemnify the other party for certain matters in the ordinary course of business, which indemnities may be secured by operation of law or otherwise. These agreements primarily relate to the Company’s commercial contracts, service agreements, contracts entered into for the purchase and sale of stock or assets, operating leases and other real estate contracts, financial agreements, agreements to provide services to the Company and agreements to indemnify officers, directors and employees in the performance of their work. While the Company’s aggregate indemnification obligations could result in a material liability, the Company is not aware of any matters that are expected to result in a material liability. No amount has been recorded in the Condensed Consolidated Balance Sheets for these contingent obligations as the fair value has been determined to be de minimis. In connection with Supervalu’s sale of New Albertson’s, Inc. (“NAI”) on March 21, 2013, the Company remains contingently liable with respect to certain self-insurance commitments and other guarantees as a result of parental guarantees issued by Supervalu with respect to the obligations of NAI that were incurred while NAI was Supervalu’s subsidiary. Based on the expected settlement of the self-insurance claims that underlie the Company’s commitments, the Company believes that such contingent liabilities will continue to decline. Subsequent to the sale of NAI, NAI collateralized most of these obligations with letters of credit and surety bonds to numerous state governmental authorities. Because NAI remains a primary obligor on these self-insurance and other obligations and has collateralized most of the self-insurance obligations for which the Company remains contingently liable, the Company believes that the likelihood that it will be required to assume a material amount of these obligations is remote. Accordingly, no amount has been recorded in the Condensed Consolidated Balance Sheets for these guarantees, as the fair value has been determined to be de minimis. Agreements with Save-A-Lot and Onex The Agreement and Plan of Merger pursuant to which Supervalu sold the Save-A-Lot business in 2016 (the “SAL Merger Agreement”) contains customary indemnification obligations of each party with respect to breaches of their respective representations, warranties and covenants, and certain other specified matters, on the terms and subject to the limitations set forth in the SAL Merger Agreement. Similarly, Supervalu entered into a Separation Agreement (the “Separation Agreement”) with Moran Foods, LLC d/b/a Save-A-Lot (“Moran Foods”), which contains indemnification obligations and covenants related to the separation of the assets and liabilities of the Save-A-Lot business from the Company. The Company also entered into a Services Agreement with Moran Foods (the “Services Agreement”), pursuant to which the Company is providing Save-A-Lot with various technical, human resources, finance and other operational services for a term of five years, subject to termination provisions that can be exercised by each party. The initial annual base charge under the Services Agreement is $30 million, subject to adjustments. The Company expects that services provided under the Services Agreement will wind down in 2022. The Services Agreement generally requires each party to indemnify the other party against third-party claims arising out of the performance of or the provision or receipt of services under the Services Agreement. While the Company’s aggregate indemnification obligations to Save-A-Lot and Onex, the purchaser of Save-A-Lot, could result in a material liability, the Company is not aware of any matters that are expected to result in a material liability. The Company has recorded the fair value of the guarantee in the Condensed Consolidated Balance Sheets within Other long-term liabilities. Other Contractual Commitments In the ordinary course of business, the Company enters into supply contracts to purchase products for resale, and service contracts for fixed asset and information technology systems. These contracts typically include either volume commitments or fixed expiration dates, termination provisions and other standard contractual considerations. As of January 29, 2022, the Company had approximately $225 million of non-cancelable future purchase obligations, most of which will be paid and utilized in the ordinary course within one year. Legal Proceedings The Company is one of dozens of companies that have been named in various lawsuits alleging that drug manufacturers, retailers and distributors contributed to the national opioid epidemic. Currently, UNFI, primarily through its subsidiary, Advantage Logistics, is named in approximately 43 suits pending in the United States District Court for the Northern District of Ohio where over 1,800 cases have been consolidated as Multi-District Litigation (“MDL”). In accordance with the Stock Purchase Agreement dated January 10, 2013, between New Albertson’s Inc. (“New Albertson’s”) and the Company (the “Stock Purchase Agreement”), New Albertson’s is defending and indemnifying UNFI in a majority of the cases under a reservation of rights as those cases relate to New Albertson’s pharmacies. In one of the MDL cases, MDL No. 2804 filed by The Blackfeet Tribe of the Blackfeet Indian Reservation, all defendants were ordered to Answer the Complaint, which UNFI did on July 26, 2019. To date, no discovery has been conducted against UNFI in any of the actions. UNFI is vigorously defending these matters, which it believes are without merit. On January 21, 2021, various health plans filed a complaint in Minnesota state court against the Company, Albertson’s Companies, LLC (“Albertson’s”) and Safeway, Inc. alleging the defendants committed fraud by improperly reporting inflated prices for prescription drugs for members of health plans. The Plaintiffs assert six causes of action against the defendants: common law fraud, fraudulent nondisclosure, negligent misrepresentation, unjust enrichment, violation of the Minnesota Uniform Deceptive Trade Practices Act and violation of the Minnesota Prevention of Consumer Fraud Act. The plaintiffs allege that between 2006 and 2016, Supervalu overcharged the health plans by not providing the health plans, as part of usual and customary prices, the benefit of discounts given to customers purchasing prescription medication who requested that Supervalu match competitor prices. Plaintiffs seek an unspecified amount of damages. Similar to the above case, for the majority of the relevant period Supervalu and Albertson’s operated as a combined company. In March 2013, Supervalu divested Albertson’s and pursuant to the Stock Purchase Agreement, Albertson’s is responsible for any claims regarding its pharmacies. On February 19, 2021, Albertson’s and Safeway removed the case to Minnesota Federal District Court and on March 22, 2021 plaintiffs’ filed a motion to remand to state court. On February 26, 2021, defendants filed a motion to dismiss. The hearing on the remand motion and motions to dismiss occurred on May 20, 2021. On September 21, 2021, the Federal District Court remanded the case to Minnesota state court and did not rule on the motion to dismiss, which was refiled in state court. On February 1, 2022, the state court denied the motion to dismiss. The Company believes these claims are without merit and intends to vigorously defend this matter. UNFI is currently subject to a qui tam action alleging violations of the False Claims Act (“FCA”). In United States ex rel. Schutte and Yarberry v. Supervalu, New Albertson’s, Inc., et al, which is pending in the U.S. District Court for the Central District of Illinois, the relators allege that defendants overcharged government healthcare programs by not providing the government, as a part of usual and customary prices, the benefit of discounts given to customers purchasing prescription medication who requested that defendants match competitor prices. The complaint was originally filed under seal and amended on November 30, 2015. The government previously investigated the relators’ allegations and declined to intervene. Violations of the FCA are subject to treble damages and penalties of up to a specified dollar amount per false claim. Relators elected to pursue the case on their own and have alleged FCA damages against Supervalu and New Albertson’s in excess of $100 million, not including trebling and statutory penalties. For the majority of the relevant period Supervalu and New Albertson’s operated as a combined company. In March 2013, Supervalu divested New Albertson’s (and related assets) pursuant to the Stock Purchase Agreement. Based on the claims that are currently pending and the Stock Purchase Agreement, Supervalu’s share of a potential award (at the currently claimed value by relators) would be approximately $24 million, not including trebling and statutory penalties. Both sides moved for summary judgment. On August 5, 2019, the Court granted one of the relators’ summary judgment motions finding that the defendants’ lower matched prices are the usual and customary prices and that Medicare Part D and Medicaid were entitled to those prices. On July 2, 2020 the Court granted the defendants’ summary judgment motion and denied the relators’ motion, dismissing the case. On July 9, 2020 the relators filed a notice of appeal with the 7th Circuit Court of Appeals, and on September 30, 2020 filed an appellate brief. On November 30, 2020, the Company filed its response. The hearing before the 7th Circuit Court of Appeals occurred on January 19, 2021. On August 12, 2021, the 7th Circuit affirmed the District Court’s decision granting summary judgment in defendants’ favor. On September 23, 2021, the Relators filed a petition for rehearing and defendants filed a response on November 9, 2021. On December 3, 2021, the 7th Circuit denied the petition for rehearing. From time to time, the Company receives notice of claims or potential claims or becomes involved in litigation, alternative dispute resolution, such as arbitration, or other legal and regulatory proceedings that arise in the ordinary course of its business, including investigations and claims regarding employment law, including wage and hour (including class actions); pension plans; labor union disputes, including unfair labor practices, such as claims for back-pay in the context of labor contract negotiations and other matters; supplier, customer and service provider contract terms and claims, including matters related to supplier or customer insolvency or general inability to pay obligations as they become due; product liability claims, including those where the supplier may be insolvent and customers or consumers are seeking recovery against the Company; real estate and environmental matters, including claims in connection with its ownership and lease of a substantial amount of real property, both retail and warehouse properties; and antitrust. Other than as described above, there are no pending material legal proceedings to which the Company is a party or to which its property is subject. Predicting the outcomes of claims and litigation and estimating related costs and exposures involves substantial uncertainties that could cause actual outcomes, costs and exposures to vary materially from current expectations. Management regularly monitors the Company’s exposure to the loss contingencies associated with these matters and may from time to time change its predictions with respect to outcomes and estimates with respect to related costs and exposures. As of January 29, 2022, no material accrued obligations, individually or in the aggregate, have been recorded for these legal proceedings. Although management believes it has made appropriate assessments of potential and contingent loss in each of these cases based on current facts and circumstances, and application of prevailing legal principles, there can be no assurance that material differences in actual outcomes from management’s current assessments, costs and exposures relative to current predictions and estimates, or material changes in such predictions or estimates will not occur. The occurrence of any of the foregoing, could have a material adverse effect on our financial condition, results of operations or cash flows. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Jan. 29, 2022 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 16—SUBSEQUENT EVENTS Subsequent to the end of the second quarter of fiscal 2022, in February 2022, the Company acquired the real property of a previously leased distribution center for approximately $153 million. Immediately following this acquisition, the Company monetized this property through a sale-leaseback transaction, pursuant to which the Company received $225 million in aggregate proceeds for the sale of the property. Under the terms of the sale-leaseback agreement, the Company entered into a lease for the distribution center for a term of 15 years. The Company expects to record a pre-tax gain on sale in the third quarter of fiscal 2022 currently estimated to be approximately $85 million as a result of the transactions, which primarily reflects the pre-tax net proceeds of the transactions. Refer to Note 8—Long-Term Debt for discussion on a voluntary prepayment made under the Term Loan Facility subsequent to the end of the second quarter of fiscal 2022. |
SIGNIFICANT ACCOUNTING POLICI_2
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jan. 29, 2022 | |
Accounting Policies [Abstract] | |
Nature of Business | Nature of Business United Natural Foods, Inc. and its subsidiaries (the “Company”, “we”, “us”, “UNFI”, or “our”) is a leading distributor of natural, organic, specialty, produce and conventional grocery and non-food products, and provider of support services to retailers. The Company sells its products primarily throughout the United States and Canada. |
Fiscal Year | Fiscal Year The Company’s fiscal years end on the Saturday closest to July 31 and contain either 52 or 53 weeks. References to the second quarter of fiscal 2022 and 2021 relate to the 13-week fiscal quarters ended January 29, 2022 and January 30, 2021, respectively. References to fiscal 2022 and 2021 year-to-date relate to the 26-week fiscal periods ended January 29, 2022 and January 30, 2021, respectively. |
Basis of Presentation | Basis of Presentation The accompanying unaudited Condensed Consolidated Financial Statements include the accounts of the Company and its subsidiaries. All significant intercompany transactions and balances have been eliminated in consolidation. Unless otherwise indicated in these Condensed Consolidated Financial Statements, references to the Condensed Consolidated Statements of Operations, the Condensed Consolidated Balance Sheets and the Notes to the Condensed Consolidated Financial Statements exclude all amounts related to discontinued operations. |
Discontinued Operations | Discontinued Operations In the fourth quarter of fiscal 2021, the Company determined it no longer met the held for sale criterion for a probable sale to be completed within 12 months for two of the four stores that were previously included within discontinued operations. As a result, the Company revised its Condensed Consolidated Financial Statements to reclassify two Shoppers stores from discontinued operations to continuing operations. The prior period presented in the Condensed Consolidated Financial Statements have been conformed to the current period presentation. The remaining two stores included in discontinued operations were sold in the second quarter of fiscal 2022. |
Use of Estimates | Use of Estimates The preparation of the Condensed Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Cash and Cash Equivalents | Cash and Cash EquivalentsCash equivalents consist of highly liquid investments with original maturities of three months or less. The Company’s banking arrangements allow it to fund outstanding checks when presented to the financial institution for payment. The Company funds all intraday bank balance overdrafts during the same business day. Checks outstanding in excess of bank balances create book overdrafts, which are recorded in Accounts payable in the Condensed Consolidated Balance Sheets and are reflected as an operating activity in the Condensed Consolidated Statements of Cash Flows. |
Reclassifications | Reclassifications Within the Condensed Consolidated Financial Statements certain immaterial amounts have been reclassified to conform with current year presentation. These reclassifications had no impact on reported net income, cash flows, or total assets and liabilities. |
Inventories, Net | Inventories, NetSubstantially all of the Company’s inventories consist of finished goods. To value discrete inventory items at lower of cost or net realizable value before application of any last-in, first-out (“LIFO”) reserve, the Company utilizes the weighted average cost method, perpetual cost method, the retail inventory method and the replacement cost method. Allowances for vendor funds received from suppliers are recorded as a reduction to Inventories, net and subsequently within Cost of sales upon the sale of the related products. Inventory quantities are evaluated throughout each fiscal year based on actual physical counts in our distribution facilities and stores. Allowances for inventory shortages are recorded based on the results of these counts to provide for estimated shortages as of the end of each fiscal year. |
Recently Adopted and Issued Accounting Pronouncements | Recently Adopted Accounting Pronouncements In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes . ASU 2019-12 eliminates certain exceptions to Topic 740’s general principles. The amendments also improve consistency in and simplify its application. The Company adopted this standard in the first quarter of fiscal 2022. The adoption of this standard did not have a material impact on the Company’s Condensed Consolidated Financial Statements. Recently Issued Accounting Pronouncements In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting |
REVENUE RECOGNITION (Tables)
REVENUE RECOGNITION (Tables) | 6 Months Ended |
Jan. 29, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following tables detail the Company’s net sales for the periods presented by customer channel for each of its segments. The Company does not record its revenues within its Wholesale reportable segment for financial reporting purposes by product group, and it is therefore impracticable for it to report them accordingly. Net Sales for the 13-Week Period Ended (in millions) January 29, 2022 Customer Channel Wholesale Retail Other Eliminations (1) Consolidated Chains $ 3,243 $ — $ — $ — $ 3,243 Independent retailers 1,905 — — — 1,905 Supernatural 1,453 — — — 1,453 Retail — 643 — — 643 Other 531 — 50 — 581 Eliminations — — — (409) (409) Total $ 7,132 $ 643 $ 50 $ (409) $ 7,416 Net Sales for the 13-Week Period Ended (in millions) January 30, 2021 Customer Channel Wholesale Retail Other Eliminations (1) Consolidated Chains $ 3,106 $ — $ — $ — $ 3,106 Independent retailers 1,701 — — — 1,701 Supernatural 1,298 — — — 1,298 Retail — 633 — — 633 Other 513 — 55 — 568 Eliminations — — — (406) (406) Total $ 6,618 $ 633 $ 55 $ (406) $ 6,900 Net Sales for the 26-Week Period Ended (in millions) January 29, 2022 Customer Channel Wholesale Retail Other Eliminations (1) Consolidated Chains $ 6,325 $ — $ — $ — $ 6,325 Independent retailers 3,655 — — — 3,655 Supernatural 2,831 — — — 2,831 Retail — 1,245 — — 1,245 Other 1,055 — 106 — 1,161 Eliminations — — — (804) (804) Total $ 13,866 $ 1,245 $ 106 $ (804) $ 14,413 Net Sales for the 26-Week Period Ended (in millions) January 30, 2021 Customer Channel Wholesale Retail Other Eliminations (1) Consolidated Chains $ 6,133 $ — $ — $ — $ 6,133 Independent retailers 3,373 — — — 3,373 Supernatural 2,512 — — — 2,512 Retail — 1,239 — — 1,239 Other 1,038 — 111 — 1,149 Eliminations — — — (822) (822) Total $ 13,056 $ 1,239 $ 111 $ (822) $ 13,584 (1) Eliminations primarily includes the net sales elimination of Wholesale’s sales to the Retail segment and the elimination of sales from segments included within Other to Wholesale. |
Schedule of Accounts, Notes, Loans and Financing Receivable | Accounts and notes receivable are as follows: (in millions) January 29, 2022 July 31, 2021 Customer accounts receivable $ 1,254 $ 1,115 Allowance for uncollectible receivables (29) (28) Other receivables, net 16 16 Accounts receivable, net $ 1,241 $ 1,103 Notes receivable, net, included within Prepaid expenses and other current assets $ 7 $ 7 Long-term notes receivable, net, included within Other long-term assets $ 13 $ 15 |
RESTRUCTURING, ACQUISITION, A_2
RESTRUCTURING, ACQUISITION, AND INTEGRATION RELATED EXPENSES (Tables) | 6 Months Ended |
Jan. 29, 2022 | |
Restructuring and Related Activities [Abstract] | |
Restructuring, Acquisition and Integration Related Expenses Incurred | Restructuring, acquisition and integration related expenses were as follows: 13-Week Period Ended 26-Week Period Ended (in millions) January 29, 2022 January 30, 2021 January 29, 2022 January 30, 2021 Restructuring and integration costs $ 4 $ 14 $ 7 $ 29 Closed property charges and costs 1 4 1 5 Total $ 5 $ 18 $ 8 $ 34 |
GOODWILL AND INTANGIBLE ASSET_2
GOODWILL AND INTANGIBLE ASSETS, NET (Tables) | 6 Months Ended |
Jan. 29, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Carrying Value of Goodwill | Changes in the carrying value of Goodwill by reportable segment that have goodwill consisted of the following: (in millions) Wholesale Other Total Goodwill as of July 31, 2021 $ 10 (1) $ 10 (2) $ 20 Change in foreign exchange rates — — — Goodwill as of January 29, 2022 $ 10 (1) $ 10 (2) $ 20 (1) Wholesale amounts are net of accumulated goodwill impairment charges of $717 million as of July 31, 2021 and January 29, 2022. (2) Other amounts are net of accumulated goodwill impairment charges of $10 million as of July 31, 2021 and January 29, 2022. |
Identifiable Intangible Assets | Identifiable intangible assets, net consisted of the following: January 29, 2022 July 31, 2021 (in millions) Gross Carrying Accumulated Net Gross Carrying Accumulated Net Amortizing intangible assets: Customer relationships $ 1,007 $ 264 $ 743 $ 1,007 $ 234 $ 773 Pharmacy prescription files 33 15 18 33 13 20 Operating lease intangibles 7 5 2 7 4 3 Trademarks and tradenames 84 48 36 84 45 39 Total amortizing intangible assets 1,131 332 799 1,131 296 835 Indefinite lived intangible assets: Trademarks and tradenames 56 — 56 56 — 56 Intangibles assets, net $ 1,187 $ 332 $ 855 $ 1,187 $ 296 $ 891 |
Estimated Future Amortization Expense | The estimated future amortization expense for each of the next five fiscal years and thereafter on definite lived intangible assets existing as of January 29, 2022 is as follows: Fiscal Year: (in millions) Remaining fiscal 2022 $ 36 2023 72 2024 72 2025 70 2026 66 Thereafter 483 $ 799 |
FAIR VALUE MEASUREMENTS OF FI_2
FAIR VALUE MEASUREMENTS OF FINANCIAL INSTRUMENTS (Tables) | 6 Months Ended |
Jan. 29, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following tables provide the fair value hierarchy for financial assets and liabilities measured on a recurring basis: Condensed Consolidated Balance Sheets Location Fair Value at January 29, 2022 (in millions) Level 1 Level 2 Level 3 Assets: Fuel derivatives designated as hedging instruments Prepaid expenses and other current assets $ — $ 2 $ — Foreign currency derivatives designated as hedging instruments Prepaid expenses and other current assets $ — $ 1 $ — Mutual funds Other long-term assets $ 1 $ — $ — Liabilities: Interest rate swaps designated as hedging instruments Accrued expenses and other current liabilities $ — $ 24 $ — Interest rate swaps designated as hedging instruments Other long-term liabilities $ — $ 15 $ — Condensed Consolidated Balance Sheets Location Fair Value at July 31, 2021 (in millions) Level 1 Level 2 Level 3 Assets: Fuel derivatives designated as hedging instruments Prepaid expenses and other current assets $ — $ 1 $ — Mutual funds Other long-term assets $ 2 $ — $ — Liabilities: Foreign currency derivatives designated as hedging instruments Accrued expenses and other current liabilities $ — $ 1 $ — Interest rate swaps designated as hedging instruments Accrued expenses and other current liabilities $ — $ 33 $ — Interest rate swaps designated as hedging instruments Other long-term liabilities $ — $ 42 $ — |
Fair Value, By Balance Sheet Grouping | In the table below, the carrying value of the Company’s long-term debt is net of original issue discounts and debt issuance costs. January 29, 2022 July 31, 2021 (in millions) Carrying Value Fair Value Carrying Value Fair Value Notes receivable, including current portion $ 25 $ 22 $ 29 $ 26 Long-term debt, including current portion $ 2,323 $ 2,394 $ 2,188 $ 2,278 |
DERIVATIVES (Tables)
DERIVATIVES (Tables) | 6 Months Ended |
Jan. 29, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Instruments | Details of active swap contracts as of January 29, 2022, which are all pay fixed and receive floating, are as follows: Effective Date Swap Maturity Notional Value (in millions) Pay Fixed Rate Receive Floating Rate (2) Floating Rate Reset Terms August 3, 2015 (1) August 15, 2022 $ 31 1.7950 % One-Month LIBOR Monthly October 26, 2018 October 31, 2022 100 2.8915 % One-Month LIBOR Monthly January 11, 2019 October 31, 2022 50 2.4678 % One-Month LIBOR Monthly January 23, 2019 October 31, 2022 50 2.5255 % One-Month LIBOR Monthly November 16, 2018 March 31, 2023 150 2.8950 % One-Month LIBOR Monthly January 23, 2019 March 31, 2023 50 2.5292 % One-Month LIBOR Monthly November 30, 2018 September 30, 2023 50 2.8315 % One-Month LIBOR Monthly October 26, 2018 October 31, 2023 100 2.9210 % One-Month LIBOR Monthly January 11, 2019 March 28, 2024 100 2.4770 % One-Month LIBOR Monthly January 23, 2019 March 28, 2024 100 2.5420 % One-Month LIBOR Monthly November 30, 2018 October 31, 2024 100 2.8480 % One-Month LIBOR Monthly January 11, 2019 October 31, 2024 100 2.5010 % One-Month LIBOR Monthly January 24, 2019 October 31, 2024 50 2.5210 % One-Month LIBOR Monthly October 26, 2018 October 22, 2025 50 2.9550 % One-Month LIBOR Monthly November 16, 2018 October 22, 2025 50 2.9590 % One-Month LIBOR Monthly November 16, 2018 October 22, 2025 50 2.9580 % One-Month LIBOR Monthly January 24, 2019 October 22, 2025 50 2.5558 % One-Month LIBOR Monthly $ 1,231 (1) The swap contract has an amortizing notional principal amount which is reduced by $1 million on a quarterly basis. (2) For these swap contracts that are indexed to LIBOR, the Company is monitoring and evaluating risks related to the expected future cessation of LIBOR. |
Schedule of Interest Rate Derivatives | The location and amount of gains or losses recognized in the Condensed Consolidated Statements of Operations for interest rate swap contracts for each of the periods, presented on a pretax basis, are as follows: 13-Week Period Ended 26-Week Period Ended January 29, 2022 January 30, 2021 January 29, 2022 January 30, 2021 (in millions) Interest expense, net Interest expense, net Total amounts of expense line items presented in the Condensed Consolidated Statements of Operations in which the effects of cash flow hedges are recorded $ 44 $ 51 $ 84 $ 120 Loss on cash flow hedging relationships: Loss reclassified from comprehensive income into earnings $ (10) $ (12) $ (21) $ (24) |
LONG-TERM DEBT (Tables)
LONG-TERM DEBT (Tables) | 6 Months Ended |
Jan. 29, 2022 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | The Company’s long-term debt consisted of the following: (in millions) Average Interest Rate at January 29, 2022 Fiscal Maturity Year January 29, July 31, Term Loan Facility 3.35% 2026 $ 844 $ 1,002 ABL Credit Facility 1.54% 2024 990 701 Senior Notes 6.75% 2029 500 500 Other secured loans 5.14% 2024-2025 30 37 Debt issuance costs, net (28) (35) Original issue discount on debt (13) (17) Long-term debt, including current portion 2,323 2,188 Less: current portion of long-term debt (14) (13) Long-term debt $ 2,309 $ 2,175 |
Schedule of Line of Credit Facilities | The assets included in the Condensed Consolidated Balance Sheets securing the outstanding obligations under the ABL Credit Facility on a first-priority basis, and the unused credit and fees under the ABL Credit Facility, were as follows: Assets securing the ABL Credit Facility (in millions) (1) : January 29, July 31, Certain inventory assets included in Inventories, net and Current assets of discontinued operations $ 2,454 $ 2,297 Certain receivables included in Accounts receivable, net and Current assets of discontinued operations $ 1,158 $ 1,041 (1) The ABL Credit Facility is also secured by all of the Company’s pharmacy prescription files, which are included in Intangibles, net in the Condensed Consolidated Balance Sheets. Refer to Note 5—Goodwill and Intangible Assets, Net for additional information. ABL availability (in millions): January 29, 2022 Total availability for ABL Loans and letters of credit $ 2,096 ABL Loans $ 990 Letters of credit $ 115 Unused credit $ 991 The applicable interest rates, letter of credit fees and unutilized commitment fees under the ABL Credit Facility are variable and are dependent upon the prior fiscal quarter’s daily Average Availability (as defined in the ABL Agreement), and were as follows: Interest rates and fees under the ABL Credit Facility: Range of Facility Rates and Fees (per annum) January 29, 2022 U.S. and Canadian Borrowers’ applicable margin for base rate loans —% - 0.50% 0.25 % U.S. and Canadian Borrowers’ applicable margin for LIBOR and BA loans (1) 1.00% - 1.50% 1.25 % Unutilized commitment fees 0.25% - 0.375% 0.25 % Letter of credit fees 1.125% - 1.625% 1.375 % (1) The U.S. Borrowers utilize LIBOR-based loans and the Canadian Borrower utilizes bankers’ acceptance rate-based loans. |
COMPREHENSIVE INCOME AND ACCU_2
COMPREHENSIVE INCOME AND ACCUMULATED OTHER COMPREHENSIVE LOSS (Tables) | 6 Months Ended |
Jan. 29, 2022 | |
Equity [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) | Changes in Accumulated other comprehensive loss by component, net of tax, for fiscal 2022 year-to-date are as follows: (in millions) Other Cash Flow Derivatives Benefit Plans Foreign Currency Translation Swap Agreements Total Accumulated other comprehensive income (loss) at July 31, 2021 $ — $ 37 $ (16) $ (60) $ (39) Other comprehensive income (loss) before reclassifications 1 — (2) 13 12 Amortization of amounts included in net periodic benefit income — 2 — — 2 Amortization of cash flow hedges 1 — — 15 16 Net current period Other comprehensive income (loss) 2 2 (2) 28 30 Accumulated other comprehensive income (loss) at January 29, 2022 $ 2 $ 39 $ (18) $ (32) $ (9) Changes in Accumulated other comprehensive loss by component, net of tax, for fiscal 2021 year-to-date are as follows: (in millions) Benefit Plans Foreign Currency Translation Swap Agreements Total Accumulated other comprehensive loss at August 1, 2020 $ (116) $ (21) $ (102) $ (239) Other comprehensive income before reclassifications — 3 5 8 Amortization of amounts included in net periodic benefit income (1) — — (1) Amortization of cash flow hedges — — 17 17 Net current period Other comprehensive (loss) income (1) 3 22 24 Accumulated other comprehensive loss at January 30, 2021 $ (117) $ (18) $ (80) $ (215) |
Reclassification Out of Accumulated Other Comprehensive Income | Items reclassified out of Accumulated other comprehensive loss had the following impact on the Condensed Consolidated Statements of Operations: 13-Week Period Ended 26-Week Period Ended Affected Line Item on the Condensed Consolidated Statements of Operations (in millions) January 29, January 30, January 29, January 30, Pension and postretirement benefit plan net assets: Amortization of amounts included in net periodic benefit income (1) $ 1 $ (1) $ 2 $ (1) Net periodic benefit income, excluding service cost Income tax (benefit) expense — — — — Provision for income taxes Total reclassifications, net of tax $ 1 $ (1) $ 2 $ (1) Swap agreements: Reclassification of cash flow hedges $ 10 $ 12 $ 21 $ 24 Interest expense, net Income tax benefit (3) (4) (6) (7) Provision for income taxes Total reclassifications, net of tax $ 7 $ 8 $ 15 $ 17 Other cash flow hedges: Reclassification of cash flow hedge $ 2 $ — $ 2 $ — Cost of sales Income tax benefit (1) — (1) — Provision for income taxes Total reclassification, net of tax $ 1 $ — $ 1 $ — (1) Reclassification of amounts included in net periodic benefit income include reclassification of prior service cost and reclassification of net actuarial loss as reflected in Note 11—Benefit Plans. |
BENEFIT PLANS (Tables)
BENEFIT PLANS (Tables) | 6 Months Ended |
Jan. 29, 2022 | |
Retirement Benefits [Abstract] | |
Net Periodic Benefit Cost (Income) Recognized in Other Comprehensive Income (Loss) | Net periodic benefit income and contributions to defined benefit pension and other post-retirement benefit plans consisted of the following: 13-Week Period Ended Pension Benefits Other Postretirement Benefits (in millions) January 29, 2022 January 30, 2021 January 29, 2022 January 30, 2021 Net Periodic Benefit (Income) Cost Interest cost $ 9 $ 9 $ — $ 1 Expected return on plan assets (20) (26) — — Amortization of prior service cost (credit) — — 1 (1) Amortization of net actuarial loss (gain) — 1 — (1) Net periodic benefit (income) cost $ (11) $ (16) $ 1 $ (1) Contributions to benefit plans $ — $ (1) $ (1) $ (1) 26-Week Period Ended Pension Benefits Other Postretirement Benefits (in thousands) January 29, 2022 January 30, 2021 January 29, 2022 January 30, 2021 Net Periodic Benefit (Income) Cost Interest cost $ 19 $ 18 $ — $ 1 Expected return on plan assets (41) (52) — — Amortization of prior service cost (credit) — — 2 (1) Amortization of net actuarial loss (gain) — 1 — (1) Net periodic benefit (income) cost $ (22) $ (33) $ 2 $ (1) Contributions to benefit plans $ — $ (1) $ (2) $ (2) |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 6 Months Ended |
Jan. 29, 2022 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings (Loss) Per Share | The following is a reconciliation of the basic and diluted number of shares used in computing earnings per share: 13-Week Period Ended 26-Week Period Ended (in millions, except per share data) January 29, January 30, January 29, January 30, Basic weighted average shares outstanding 58.3 56.1 57.6 55.7 Net effect of dilutive stock awards based upon the treasury stock method 2.7 3.1 3.4 3.4 Diluted weighted average shares outstanding 61.0 59.2 61.0 59.1 Basic earnings per share: Continuing operations $ 1.13 $ 1.01 $ 2.47 $ 0.99 Discontinued operations $ — $ 0.04 $ — $ 0.05 Basic earnings per share $ 1.13 $ 1.05 $ 2.47 $ 1.04 Diluted earnings per share: Continuing operations $ 1.08 $ 0.96 $ 2.33 $ 0.93 Discontinued operations $ — $ 0.04 $ — $ 0.05 Diluted earnings per share $ 1.08 $ 1.00 $ 2.33 $ 0.98 Anti-dilutive stock-based awards excluded from the calculation of diluted earnings per share 0.4 1.1 0.9 1.2 |
BUSINESS SEGMENTS (Tables)
BUSINESS SEGMENTS (Tables) | 6 Months Ended |
Jan. 29, 2022 | |
Segment Reporting [Abstract] | |
Schedule of Business Segment Information | The following table provides continuing operations information by reportable segment, including Net sales, Adjusted EBITDA with a reconciliation to Income from continuing operations before income taxes, depreciation and amortization, and payments for capital expenditures: 13-Week Period Ended 26-Week Period Ended (in millions) January 29, 2022 January 30, 2021 January 29, 2022 January 30, 2021 Net sales: Wholesale (1) $ 7,132 $ 6,618 $ 13,866 $ 13,056 Retail 643 633 1,245 1,239 Other 50 55 106 111 Eliminations (409) (406) (804) (822) Total Net sales $ 7,416 $ 6,900 $ 14,413 $ 13,584 Continuing Operations Adjusted EBITDA: Wholesale $ 159 $ 188 $ 323 $ 311 Retail 30 26 52 51 Other 12 (8) 16 (4) Eliminations — (2) (1) 4 Adjustments: Net income attributable to noncontrolling interests 2 2 3 3 Net periodic benefit income, excluding service cost 10 17 20 34 Interest expense, net (44) (51) (84) (120) Other, net 2 2 1 3 Depreciation and amortization (69) (67) (138) (144) Share-based compensation (12) (13) (23) (27) Restructuring, acquisition and integration related expenses (5) (18) (8) (34) Loss on sale of assets (1) — (1) — Multi-employer pension plan withdrawal benefit 8 — 8 — Other retail benefit (expense) 1 (1) 1 (3) Income from continuing operations before income taxes $ 93 $ 75 $ 169 $ 74 Depreciation and amortization: Wholesale $ 61 $ 59 $ 122 $ 127 Retail 8 7 15 14 Other — 1 1 3 Total depreciation and amortization $ 69 $ 67 $ 138 $ 144 Payments for capital expenditures: Wholesale $ 46 $ 46 $ 98 $ 84 Retail 4 5 8 8 Total capital expenditures $ 50 $ 51 $ 106 $ 92 (1) As presented in Note 3—Revenue Recognition, for the second quarters of fiscal 2022 and 2021, the Company recorded $356 million and $354 million, respectively, and $695 million and $719 million in fiscal 2022 and 2021 year-to-date, respectively, within Net sales in its Wholesale reportable segment attributable to Wholesale sales to its Retail segment that have been eliminated upon consolidation. Total assets of continuing operations by reportable segment were as follows: (in millions) January 29, July 31, Assets: Wholesale $ 6,851 $ 6,536 Retail 597 566 Other 397 462 Eliminations (44) (43) Total assets of continuing operations $ 7,801 $ 7,521 |
SIGNIFICANT ACCOUNTING POLICI_3
SIGNIFICANT ACCOUNTING POLICIES (Details) $ in Millions | Jan. 29, 2022USD ($)store | Jul. 31, 2021USD ($)store | May 01, 2021store |
Accounting Policies [Abstract] | |||
Net book overdrafts | $ | $ 292 | $ 268 | |
FIFO inventory amount | $ | $ 97 | $ 67 | |
Discontinued Operations, Disposed of by Sale | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Number of stores | 2 | ||
Discontinued operations | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Number of stores | 4 | ||
Continuing operations | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Number of stores | 2 |
REVENUE RECOGNITION - Narrative
REVENUE RECOGNITION - Narrative (Details) | Jan. 29, 2022channelstore |
Disaggregation of Revenue [Line Items] | |
Number of customer channels | channel | 5 |
Chains | |
Disaggregation of Revenue [Line Items] | |
Number of stores | store | 10 |
REVENUE RECOGNITION - Disaggreg
REVENUE RECOGNITION - Disaggregation of Revenues (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jan. 29, 2022 | Jan. 30, 2021 | Jan. 29, 2022 | Jan. 30, 2021 | |
Revenue from External Customer [Line Items] | ||||
Net sales | $ 7,416 | $ 6,900 | $ 14,413 | $ 13,584 |
Chains | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 3,243 | 3,106 | 6,325 | 6,133 |
Independent retailers | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 1,905 | 1,701 | 3,655 | 3,373 |
Supernatural | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 1,453 | 1,298 | 2,831 | 2,512 |
Retail | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 643 | 633 | 1,245 | 1,239 |
Other | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 581 | 568 | 1,161 | 1,149 |
Operating segments | Wholesale | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 7,132 | 6,618 | 13,866 | 13,056 |
Operating segments | Wholesale | Chains | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 3,243 | 3,106 | 6,325 | 6,133 |
Operating segments | Wholesale | Independent retailers | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 1,905 | 1,701 | 3,655 | 3,373 |
Operating segments | Wholesale | Supernatural | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 1,453 | 1,298 | 2,831 | 2,512 |
Operating segments | Wholesale | Retail | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Operating segments | Wholesale | Other | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 531 | 513 | 1,055 | 1,038 |
Operating segments | Retail | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 643 | 633 | 1,245 | 1,239 |
Operating segments | Retail | Chains | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Operating segments | Retail | Independent retailers | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Operating segments | Retail | Supernatural | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Operating segments | Retail | Retail | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 643 | 633 | 1,245 | 1,239 |
Operating segments | Retail | Other | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Operating segments | Other | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 50 | 55 | 106 | 111 |
Operating segments | Other | Chains | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Operating segments | Other | Independent retailers | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Operating segments | Other | Supernatural | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Operating segments | Other | Retail | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Operating segments | Other | Other | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 50 | 55 | 106 | 111 |
Eliminations | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | $ (409) | $ (406) | $ (804) | $ (822) |
REVENUE RECOGNITION - Accounts
REVENUE RECOGNITION - Accounts Receivable (Details) - USD ($) $ in Millions | Jan. 29, 2022 | Jul. 31, 2021 |
Revenue from Contract with Customer [Abstract] | ||
Customer accounts receivable | $ 1,254 | $ 1,115 |
Allowance for uncollectible receivables | (29) | (28) |
Other receivables, net | 16 | 16 |
Accounts receivable, net | 1,241 | 1,103 |
Notes receivable, net, included within Prepaid expenses and other current assets | 7 | 7 |
Long-term notes receivable, net, included within Other long-term assets | $ 13 | $ 15 |
RESTRUCTURING, ACQUISITION, A_3
RESTRUCTURING, ACQUISITION, AND INTEGRATION RELATED EXPENSES (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jan. 29, 2022 | Jan. 30, 2021 | Jan. 29, 2022 | Jan. 30, 2021 | |
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and integration costs | $ 4 | $ 14 | $ 7 | $ 29 |
Restructuring, acquisition and integration related expenses | 5 | 18 | 8 | 34 |
Closed property charges and costs | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring, acquisition and integration related expenses | $ 1 | $ 4 | $ 1 | $ 5 |
GOODWILL AND INTANGIBLE ASSET_3
GOODWILL AND INTANGIBLE ASSETS, NET - Carrying Value of Goodwill (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jan. 29, 2022 | Jul. 31, 2021 | |
Goodwill [Roll Forward] | ||
Goodwill as of beginning of period | $ 20 | |
Change in foreign exchange rates | 0 | |
Goodwill as of end of period | 20 | |
Operating segments | Wholesale | ||
Goodwill [Roll Forward] | ||
Goodwill as of beginning of period | 10 | |
Change in foreign exchange rates | 0 | |
Goodwill as of end of period | 10 | |
Accumulated goodwill impairment charges | 717 | $ 717 |
Operating segments | Other | ||
Goodwill [Roll Forward] | ||
Goodwill as of beginning of period | 10 | |
Change in foreign exchange rates | 0 | |
Goodwill as of end of period | 10 | |
Accumulated goodwill impairment charges | $ 10 | $ 10 |
GOODWILL AND INTANGIBLE ASSET_4
GOODWILL AND INTANGIBLE ASSETS, NET - Identifiable Intangible Assets (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jan. 29, 2022 | Jan. 30, 2021 | Jan. 29, 2022 | Jan. 30, 2021 | Jul. 31, 2021 | |
Goodwill and Intangible Assets [Abstract] | |||||
Amortization expense | $ 18 | $ 19 | $ 36 | $ 42 | |
Schedule of Intangible Assets [Line Items] | |||||
Finite-lived intangible assets, gross | 1,131 | 1,131 | $ 1,131 | ||
Intangible assets, accumulated amortization | 332 | 332 | 296 | ||
Finite-lived intangible assets, net | 799 | 799 | 835 | ||
Indefinite-lived intangible assets, gross carrying amount | 1,187 | 1,187 | 1,187 | ||
Indefinite-lived intangible assets, accumulated amortization | 332 | 332 | 296 | ||
Indefinite-lived intangible assets, net carrying value | 855 | 855 | 891 | ||
Trademarks and tradenames | |||||
Schedule of Intangible Assets [Line Items] | |||||
Indefinite-lived intangible assets, gross | 56 | 56 | 56 | ||
Indefinite-lived intangible assets, accumulated amortization | 0 | 0 | 0 | ||
Indefinite-lived intangible assets, net | 56 | 56 | 56 | ||
Customer relationships | |||||
Schedule of Intangible Assets [Line Items] | |||||
Finite-lived intangible assets, gross | 1,007 | 1,007 | 1,007 | ||
Intangible assets, accumulated amortization | 264 | 264 | 234 | ||
Finite-lived intangible assets, net | 743 | 743 | 773 | ||
Pharmacy prescription files | |||||
Schedule of Intangible Assets [Line Items] | |||||
Finite-lived intangible assets, gross | 33 | 33 | 33 | ||
Intangible assets, accumulated amortization | 15 | 15 | 13 | ||
Finite-lived intangible assets, net | 18 | 18 | 20 | ||
Operating lease intangibles | |||||
Schedule of Intangible Assets [Line Items] | |||||
Finite-lived intangible assets, gross | 7 | 7 | 7 | ||
Intangible assets, accumulated amortization | 5 | 5 | 4 | ||
Finite-lived intangible assets, net | 2 | 2 | 3 | ||
Trademarks and tradenames | |||||
Schedule of Intangible Assets [Line Items] | |||||
Finite-lived intangible assets, gross | 84 | 84 | 84 | ||
Intangible assets, accumulated amortization | 48 | 48 | 45 | ||
Finite-lived intangible assets, net | $ 36 | $ 36 | $ 39 |
GOODWILL AND INTANGIBLE ASSET_5
GOODWILL AND INTANGIBLE ASSETS, NET - Estimated Future Amortization Expense (Details) - USD ($) $ in Millions | Jan. 29, 2022 | Jul. 31, 2021 |
Goodwill and Intangible Assets [Abstract] | ||
Remaining fiscal 2022 | $ 36 | |
2023 | 72 | |
2024 | 72 | |
2025 | 70 | |
2026 | 66 | |
Thereafter | 483 | |
Finite-lived intangible assets, net | $ 799 | $ 835 |
FAIR VALUE MEASUREMENTS OF FI_3
FAIR VALUE MEASUREMENTS OF FINANCIAL INSTRUMENTS - Recurring Fair Value Measurements (Details) - Fair value, measurements, recurring - USD ($) $ in Millions | Jan. 29, 2022 | Jul. 31, 2021 |
Level 1 | Other long-term assets | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Mutual funds | $ 1 | $ 2 |
Level 1 | Fuel derivatives | Prepaid expenses and other current assets | Designated as hedging instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Swap assets | 0 | 0 |
Level 1 | Foreign currency derivatives | Prepaid expenses and other current assets | Designated as hedging instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Swap assets | 0 | |
Level 1 | Foreign currency derivatives | Accrued expenses and other current liabilities | Designated as hedging instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Swap liabilities | 0 | |
Level 1 | Interest rate swaps | Accrued expenses and other current liabilities | Designated as hedging instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Swap liabilities | 0 | 0 |
Level 1 | Interest rate swaps | Other long-term liabilities | Designated as hedging instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Swap liabilities | 0 | 0 |
Level 2 | Other long-term assets | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Mutual funds | 0 | 0 |
Level 2 | Fuel derivatives | Prepaid expenses and other current assets | Designated as hedging instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Swap assets | 2 | 1 |
Level 2 | Foreign currency derivatives | Prepaid expenses and other current assets | Designated as hedging instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Swap assets | 1 | |
Level 2 | Foreign currency derivatives | Accrued expenses and other current liabilities | Designated as hedging instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Swap liabilities | 1 | |
Level 2 | Interest rate swaps | Accrued expenses and other current liabilities | Designated as hedging instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Swap liabilities | 24 | 33 |
Level 2 | Interest rate swaps | Other long-term liabilities | Designated as hedging instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Swap liabilities | 15 | 42 |
Level 3 | Other long-term assets | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Mutual funds | 0 | 0 |
Level 3 | Fuel derivatives | Prepaid expenses and other current assets | Designated as hedging instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Swap assets | 0 | 0 |
Level 3 | Foreign currency derivatives | Prepaid expenses and other current assets | Designated as hedging instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Swap assets | 0 | |
Level 3 | Foreign currency derivatives | Accrued expenses and other current liabilities | Designated as hedging instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Swap liabilities | 0 | |
Level 3 | Interest rate swaps | Accrued expenses and other current liabilities | Designated as hedging instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Swap liabilities | 0 | 0 |
Level 3 | Interest rate swaps | Other long-term liabilities | Designated as hedging instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Swap liabilities | $ 0 | $ 0 |
FAIR VALUE MEASUREMENTS OF FI_4
FAIR VALUE MEASUREMENTS OF FINANCIAL INSTRUMENTS - Narrative (Details) $ in Millions | Jan. 29, 2022USD ($) |
Fair Value Disclosures [Abstract] | |
Effect of one percent increase on fair value of interest rate fair value hedging instruments | $ 24 |
Effect of one percent decrease on fair value of interest rate fair value hedging instruments | $ 25 |
FAIR VALUE MEASUREMENTS OF FI_5
FAIR VALUE MEASUREMENTS OF FINANCIAL INSTRUMENTS - Fair Value Estimates (Details) - USD ($) $ in Millions | Jan. 29, 2022 | Jul. 31, 2021 |
Carrying Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Notes receivable, including current portion | $ 25 | $ 29 |
Long-term debt, including current portion | 2,323 | 2,188 |
Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Notes receivable, including current portion | 22 | 26 |
Long-term debt, including current portion | $ 2,394 | $ 2,278 |
DERIVATIVES - Outstanding Swap
DERIVATIVES - Outstanding Swap Contracts (Details) - USD ($) $ in Millions | Jan. 29, 2022 | Jul. 31, 2021 | Aug. 03, 2015 |
Derivative [Line Items] | |||
Derivative, notional value | $ 1,231 | ||
Interest rate swap due August 15, 2022 | |||
Derivative [Line Items] | |||
Derivative, notional value | $ 31 | ||
Derivative, forward interest rate | 1.795% | ||
Interest rate swap due October 31, 2022 | |||
Derivative [Line Items] | |||
Derivative, notional value | $ 100 | ||
Derivative, forward interest rate | 2.8915% | ||
Interest rate swap due October 31, 2022 | |||
Derivative [Line Items] | |||
Derivative, notional value | $ 50 | ||
Derivative, forward interest rate | 2.4678% | ||
Interest rate swap due October 31, 2022 | |||
Derivative [Line Items] | |||
Derivative, notional value | $ 50 | ||
Derivative, forward interest rate | 2.5255% | ||
Interest rate swap due March 31, 2023 | |||
Derivative [Line Items] | |||
Derivative, notional value | $ 150 | ||
Derivative, forward interest rate | 2.895% | ||
Interest rate swap due March 31, 2023 | |||
Derivative [Line Items] | |||
Derivative, notional value | $ 50 | ||
Derivative, forward interest rate | 2.5292% | ||
Interest rate swap due September 30, 2023 | |||
Derivative [Line Items] | |||
Derivative, notional value | $ 50 | ||
Derivative, forward interest rate | 2.8315% | ||
Interest rate swap due October 31, 2023 | |||
Derivative [Line Items] | |||
Derivative, notional value | $ 100 | ||
Derivative, forward interest rate | 2.921% | ||
Interest rate swap due March 28, 2024 | |||
Derivative [Line Items] | |||
Derivative, notional value | $ 100 | ||
Derivative, forward interest rate | 2.477% | ||
Interest rate swap due March 28, 2024 | |||
Derivative [Line Items] | |||
Derivative, notional value | $ 100 | ||
Derivative, forward interest rate | 2.542% | ||
Interest rate swap due October 31, 2024 | |||
Derivative [Line Items] | |||
Derivative, notional value | $ 100 | ||
Derivative, forward interest rate | 2.848% | ||
Interest rate swap due October 31, 2024 | |||
Derivative [Line Items] | |||
Derivative, notional value | $ 100 | ||
Derivative, forward interest rate | 2.501% | ||
Interest rate swap due October 31, 2024 | |||
Derivative [Line Items] | |||
Derivative, notional value | $ 50 | ||
Derivative, forward interest rate | 2.521% | ||
Interest rate swap due October 22, 2025 | |||
Derivative [Line Items] | |||
Derivative, notional value | $ 50 | ||
Derivative, forward interest rate | 2.955% | ||
Interest rate swap due October 22, 2025 | |||
Derivative [Line Items] | |||
Derivative, notional value | $ 50 | ||
Derivative, forward interest rate | 2.959% | ||
Interest rate swap due October 22, 2025 | |||
Derivative [Line Items] | |||
Derivative, notional value | $ 50 | ||
Derivative, forward interest rate | 2.958% | ||
Interest rate swap due October 22, 2025 | |||
Derivative [Line Items] | |||
Derivative, notional value | $ 50 | ||
Derivative, forward interest rate | 2.5558% | ||
Interest rate swaps | |||
Derivative [Line Items] | |||
Derivative, notional value | $ 504 | ||
Quarterly notional principal reduction | $ 1 |
DERIVATIVES - Narrative (Detail
DERIVATIVES - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | |
Jul. 31, 2021 | Jan. 29, 2022 | |
Derivative [Line Items] | ||
Payment to terminate interest rate swaps | $ 11 | |
Derivative, notional value | $ 1,231 | |
Gain (loss) resulting from termination of interest rate swaps | 0 | |
Interest rate swaps | ||
Derivative [Line Items] | ||
Derivative, notional value | 504 | |
Forward starting interest rate swaps | ||
Derivative [Line Items] | ||
Derivative, notional value | 450 | |
Senior Notes due 2028, 6.750% | ||
Derivative [Line Items] | ||
Debt instrument, face amount | $ 500 |
DERIVATIVES - Interest Rate Swa
DERIVATIVES - Interest Rate Swap Contracts (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jan. 29, 2022 | Jan. 30, 2021 | Jan. 29, 2022 | Jan. 30, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||
Total amounts of expense line items presented in the Condensed Consolidated Statements of Operations in which the effects of cash flow hedges are recorded | $ 44 | $ 51 | $ 84 | $ 120 |
Loss reclassified from comprehensive income into earnings | $ (10) | $ (12) | $ (21) | $ (24) |
LONG-TERM DEBT - Schedule of De
LONG-TERM DEBT - Schedule of Debt (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jan. 29, 2022 | Jul. 31, 2021 | |
Debt Instrument [Line Items] | ||
Debt issuance costs, net | $ (28) | $ (35) |
Original issue discount on debt | (13) | (17) |
Long-term debt, including current portion | 2,323 | 2,188 |
Less: current portion of long-term debt | (14) | (13) |
Long-term debt | $ 2,309 | 2,175 |
ABL Credit Facility | ||
Debt Instrument [Line Items] | ||
Average Interest Rate | 1.54% | |
Long-term debt, gross | $ 990 | 701 |
Other secured loans | ||
Debt Instrument [Line Items] | ||
Average Interest Rate | 5.14% | |
Long-term debt, gross | $ 30 | 37 |
Secured Debt | Term Loan Facility | ||
Debt Instrument [Line Items] | ||
Average Interest Rate | 3.35% | |
Long-term debt, gross | $ 844 | 1,002 |
Debt issuance costs, net | (15) | |
Original issue discount on debt | $ (12) | |
Senior Notes | Senior Notes due 2028, 6.750% | ||
Debt Instrument [Line Items] | ||
Average Interest Rate | 6.75% | |
Long-term debt, gross | $ 500 | $ 500 |
LONG-TERM DEBT - Senior Notes (
LONG-TERM DEBT - Senior Notes (Details) - Senior Notes due 2028, 6.750% - USD ($) $ in Millions | Jul. 31, 2021 | Oct. 22, 2020 |
Debt Instrument [Line Items] | ||
Debt instrument, face amount | $ 500 | |
Senior Notes | ||
Debt Instrument [Line Items] | ||
Debt instrument, face amount | $ 500 | |
Stated interest rate | 6.75% |
LONG-TERM DEBT - ABL Credit Fac
LONG-TERM DEBT - ABL Credit Facility (Details) - USD ($) $ in Millions | Jan. 29, 2022 | Jul. 31, 2021 | Oct. 19, 2018 |
Debt Instrument [Line Items] | |||
Line of credit facility, current borrowing capacity | $ 2,096 | ||
Notes payable | 2,309 | $ 2,175 | |
Debt issuance costs, net | 28 | $ 35 | |
Letter of credit | |||
Debt Instrument [Line Items] | |||
Line of credit facility, current borrowing capacity | 115 | ||
Line of credit | Revolving credit facility | ABL Credit Facility | |||
Debt Instrument [Line Items] | |||
Line of credit facility, maximum borrowing capacity | $ 2,100 | ||
Line of credit facility, maximum borrowing capacity, optional increase | $ 600 | ||
Remaining availability under ABL credit facility | 991 | ||
Line of credit | Revolving credit facility | ABL Credit Facility | Accounts receivable | |||
Debt Instrument [Line Items] | |||
Line of credit facility, borrowing base, eligibility percent | 90.00% | ||
Line of credit | Revolving credit facility | ABL Credit Facility | Credit card receivable | |||
Debt Instrument [Line Items] | |||
Line of credit facility, borrowing base, eligibility percent | 90.00% | ||
Line of credit | Revolving credit facility | ABL Credit Facility | Inventories | |||
Debt Instrument [Line Items] | |||
Line of credit facility, borrowing base, eligibility percent | 90.00% | ||
Line of credit | Revolving credit facility | ABL Credit Facility | Pharmacy receivable | |||
Debt Instrument [Line Items] | |||
Line of credit facility, borrowing base, eligibility percent | 90.00% | ||
Line of credit | Revolving credit facility | ABL Credit Facility | United States | |||
Debt Instrument [Line Items] | |||
Line of credit facility, maximum borrowing capacity | 2,050 | $ 2,050 | |
Line of credit facility, borrowing capacity, reserves | 178 | ||
Line of credit facility, current borrowing capacity | 2,439 | ||
Notes payable | 990 | ||
Debt issuance costs, net | 6 | ||
Letters of credit outstanding, amount | 115 | ||
Line of credit | Revolving credit facility | ABL Credit Facility | Canada | |||
Debt Instrument [Line Items] | |||
Line of credit facility, maximum borrowing capacity | 50 | 50 | |
Line of credit facility, borrowing capacity, reserves | 5 | ||
Line of credit facility, current borrowing capacity | 46 | ||
Remaining availability under ABL credit facility | 2,096 | ||
Notes payable | 0 | ||
Letters of credit outstanding, amount | $ 0 | ||
Line of credit | Letter of credit | ABL Credit Facility | United States | |||
Debt Instrument [Line Items] | |||
Line of credit facility, maximum borrowing capacity | 300 | ||
Line of credit | Letter of credit | ABL Credit Facility | Canada | |||
Debt Instrument [Line Items] | |||
Line of credit facility, maximum borrowing capacity | $ 25 |
LONG-TERM DEBT - Line of Credit
LONG-TERM DEBT - Line of Credit Facilities (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jan. 29, 2022 | Jul. 31, 2021 | |
Line of Credit Facility [Line Items] | ||
Availability | $ 2,096 | |
Unused credit | 991 | |
ABL Loans | ||
Line of Credit Facility [Line Items] | ||
Availability | $ 990 | |
Revolving credit facility | ABL Credit Facility | ||
Line of Credit Facility [Line Items] | ||
Unused facility fees (as a percent) | 0.25% | |
Revolving credit facility | ABL Credit Facility | Minimum | ||
Line of Credit Facility [Line Items] | ||
Unused facility fees (as a percent) | 0.25% | |
Revolving credit facility | ABL Credit Facility | Maximum | ||
Line of Credit Facility [Line Items] | ||
Unused facility fees (as a percent) | 0.375% | |
Letter of credit | ||
Line of Credit Facility [Line Items] | ||
Availability | $ 115 | |
Letter of credit | ABL Credit Facility | ||
Line of Credit Facility [Line Items] | ||
Letter of credit fees (as a percent) | 1.375% | |
Letter of credit | ABL Credit Facility | Minimum | ||
Line of Credit Facility [Line Items] | ||
Letter of credit fees (as a percent) | 1.125% | |
Letter of credit | ABL Credit Facility | Maximum | ||
Line of Credit Facility [Line Items] | ||
Letter of credit fees (as a percent) | 1.625% | |
Line of credit | Revolving credit facility | ABL Credit Facility | Base rate | ||
Line of Credit Facility [Line Items] | ||
Basis spread on variable rate (as a percent) | 0.25% | |
Line of credit | Revolving credit facility | ABL Credit Facility | Base rate | Minimum | ||
Line of Credit Facility [Line Items] | ||
Basis spread on variable rate (as a percent) | 0.00% | |
Line of credit | Revolving credit facility | ABL Credit Facility | Base rate | Maximum | ||
Line of Credit Facility [Line Items] | ||
Basis spread on variable rate (as a percent) | 0.50% | |
Line of credit | Revolving credit facility | ABL Credit Facility | LIBOR and BA | ||
Line of Credit Facility [Line Items] | ||
Basis spread on variable rate (as a percent) | 1.25% | |
Line of credit | Revolving credit facility | ABL Credit Facility | LIBOR and BA | Minimum | ||
Line of Credit Facility [Line Items] | ||
Basis spread on variable rate (as a percent) | 1.00% | |
Line of credit | Revolving credit facility | ABL Credit Facility | LIBOR and BA | Maximum | ||
Line of Credit Facility [Line Items] | ||
Basis spread on variable rate (as a percent) | 1.50% | |
Line of credit | Revolving credit facility | Certain inventory assets included in Inventories, net and Current assets of discontinued operations | ||
Line of Credit Facility [Line Items] | ||
Debt instrument, collateral amount | $ 2,454 | $ 2,297 |
Line of credit | Revolving credit facility | Certain receivables included in Accounts receivable, net and Current assets of discontinued operations | ||
Line of Credit Facility [Line Items] | ||
Debt instrument, collateral amount | $ 1,158 | $ 1,041 |
LONG-TERM DEBT - Term Loan Faci
LONG-TERM DEBT - Term Loan Facility (Details) - USD ($) $ in Millions | Mar. 09, 2022 | Nov. 10, 2021 | Feb. 11, 2021 | Oct. 22, 2018 | Jan. 29, 2022 | Jul. 31, 2021 |
Debt Instrument [Line Items] | ||||||
Pledged assets separately reported, real estate pledged as collateral, at fair value | $ 668 | $ 676 | ||||
Debt issuance costs, net | 28 | 35 | ||||
Original issue discount on debt | 13 | 17 | ||||
Current portion of long-term debt | $ 14 | $ 13 | ||||
LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, minimum variable rate (as a percent) | 0.00% | |||||
Term Loan Facility | Secured debt | ||||||
Debt Instrument [Line Items] | ||||||
Repayments of debt | $ 150 | |||||
Loss on extinguishment of debt | $ 5 | |||||
Term Loan Facility | Secured debt | Subsequent event | ||||||
Debt Instrument [Line Items] | ||||||
Repayments of debt | $ 44 | |||||
Secured debt | Base rate | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable rate (as a percent) | 2.25% | 2.50% | ||||
Secured debt | LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable rate (as a percent) | 3.25% | 3.50% | ||||
Secured debt | Term Loan Facility | ||||||
Debt Instrument [Line Items] | ||||||
Line of credit, additional borrowing capacity | $ 656 | |||||
Debt instrument, guarantees exception, carrying value of owned real property | 10 | |||||
Debt issuance costs, net | $ 15 | |||||
Original issue discount on debt | $ 12 | |||||
Secured debt | Term Loan Facility | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Period to prepay loans outstanding | 130 days | |||||
Debt instrument, covenant compliance, percentage of loans outstanding required to be paid following specified term following fiscal year end (as a percent) | 75.00% | |||||
Secured debt | Term Loan Facility | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, covenant compliance, percentage of loans outstanding required to be paid following specified term following fiscal year end (as a percent) | 0.00% | |||||
Secured debt | Term Loan Facility, Term B Tranche | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, face amount | $ 1,800 | $ 844 | ||||
Debt instrument, term | 7 years | |||||
Current portion of long-term debt | $ 0 | |||||
Secured debt | Term Loan Facility, Term B Tranche | Base rate | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable rate (as a percent) | 2.25% | |||||
Secured debt | Term Loan Facility, Term B Tranche | LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable rate (as a percent) | 3.25% |
COMPREHENSIVE INCOME AND ACCU_3
COMPREHENSIVE INCOME AND ACCUMULATED OTHER COMPREHENSIVE LOSS - Changes by Component (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jan. 29, 2022 | Jan. 30, 2021 | Jan. 29, 2022 | Jan. 30, 2021 | |
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Beginning balance | $ 1,587 | $ 1,148 | $ 1,514 | $ 1,142 |
Other comprehensive income (loss) before reclassifications | 12 | 8 | ||
Net current period Other comprehensive income (loss) | 15 | 12 | 30 | 24 |
Ending balance | 1,683 | 1,229 | 1,683 | 1,229 |
AOCI Attributable to Parent | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Beginning balance | (39) | (239) | ||
Ending balance | (9) | (215) | (9) | (215) |
Derivatives | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Amortization | 16 | 17 | ||
Derivatives | Other Cash Flow Derivatives | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Beginning balance | 0 | |||
Other comprehensive income (loss) before reclassifications | 1 | |||
Amortization | 1 | |||
Net current period Other comprehensive income (loss) | 2 | |||
Ending balance | 2 | 2 | ||
Derivatives | Swap Agreements | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Beginning balance | (60) | (102) | ||
Other comprehensive income (loss) before reclassifications | 13 | 5 | ||
Amortization | 15 | 17 | ||
Net current period Other comprehensive income (loss) | 28 | 22 | ||
Ending balance | (32) | (80) | (32) | (80) |
Benefit Plans | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Beginning balance | 37 | (116) | ||
Other comprehensive income (loss) before reclassifications | 0 | 0 | ||
Amortization | 2 | (1) | ||
Net current period Other comprehensive income (loss) | 2 | (1) | ||
Ending balance | 39 | (117) | 39 | (117) |
Foreign Currency Translation | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Beginning balance | (16) | (21) | ||
Other comprehensive income (loss) before reclassifications | (2) | 3 | ||
Net current period Other comprehensive income (loss) | (2) | 3 | ||
Ending balance | $ (18) | $ (18) | $ (18) | $ (18) |
COMPREHENSIVE INCOME AND ACCU_4
COMPREHENSIVE INCOME AND ACCUMULATED OTHER COMPREHENSIVE LOSS - Reclassification out of Other Comprehensive Loss (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jan. 29, 2022 | Jan. 30, 2021 | Jan. 29, 2022 | Jan. 30, 2021 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Interest expense, net | $ (10) | $ (12) | $ (21) | $ (24) |
Cost of sales | 6,341 | 5,905 | 12,296 | 11,619 |
Provision for income taxes | 25 | 17 | 24 | 16 |
Net income (loss) | 68 | 61 | 145 | 61 |
Total reclassifications | 24 | |||
Reclassification out of accumulated other comprehensive income | Benefit plans | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Net periodic benefit income, excluding service cost | 1 | (1) | 2 | (1) |
Provision for income taxes | 0 | 0 | 0 | 0 |
Net income (loss) | 1 | (1) | 2 | (1) |
Reclassification out of accumulated other comprehensive income | Cash flow derivatives | Swap agreements | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Interest expense, net | 10 | 12 | 21 | 24 |
Provision for income taxes | (3) | (4) | (6) | (7) |
Net income (loss) | 7 | 8 | 15 | 17 |
Reclassification out of accumulated other comprehensive income | Cash flow derivatives | Other cash flow hedges | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Cost of sales | 2 | 0 | 2 | 0 |
Provision for income taxes | (1) | 0 | (1) | 0 |
Net income (loss) | $ 1 | $ 0 | $ 1 | $ 0 |
SHARE-BASED AWARDS (Details)
SHARE-BASED AWARDS (Details) shares in Millions | Jan. 29, 2022shares |
2020 Equity incentive plan | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of shares available for grant | 2.9 |
Restricted Stock Units and Performance Share Units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Aggregate number of shares authorized | 1.1 |
BENEFIT PLANS - Net Periodic Be
BENEFIT PLANS - Net Periodic Benefit Cost (Income) Recognized in Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jan. 29, 2022 | Jan. 30, 2021 | Jan. 29, 2022 | Jan. 30, 2021 | |
Pension Benefits | ||||
Net Periodic Benefit (Income) Cost | ||||
Interest cost | $ 9 | $ 9 | $ 19 | $ 18 |
Expected return on plan assets | (20) | (26) | (41) | (52) |
Amortization of prior service cost (credit) | 0 | 0 | 0 | 0 |
Amortization of net actuarial loss (gain) | 0 | 1 | 0 | 1 |
Net periodic benefit (income) cost | (11) | (16) | (22) | (33) |
Contributions to benefit plans | 0 | (1) | 0 | (1) |
Other Postretirement Benefits | ||||
Net Periodic Benefit (Income) Cost | ||||
Interest cost | 0 | 1 | 0 | 1 |
Expected return on plan assets | 0 | 0 | 0 | 0 |
Amortization of prior service cost (credit) | 1 | (1) | 2 | (1) |
Amortization of net actuarial loss (gain) | 0 | (1) | 0 | (1) |
Net periodic benefit (income) cost | 1 | (1) | 2 | (1) |
Contributions to benefit plans | $ (1) | $ (1) | $ (2) | $ (2) |
BENEFIT PLANS - Narrative (Deta
BENEFIT PLANS - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jan. 29, 2022 | Jan. 30, 2021 | Jan. 29, 2022 | Jan. 30, 2021 | |
Other Postretirement Benefits | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Multiemployer plan, contributions by employer | $ 11 | $ 12 | $ 22 | $ 24 |
Minimum | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Defined benefit plan, expected future employer contributions, current fiscal year | 2 | 2 | ||
Maximum | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Defined benefit plan, expected future employer contributions, current fiscal year | $ 3 | $ 3 |
INCOME TAXES (Details)
INCOME TAXES (Details) | 3 Months Ended | 6 Months Ended | ||
Jan. 29, 2022 | Jan. 30, 2021 | Jan. 29, 2022 | Jan. 30, 2021 | |
Income Tax Disclosure [Abstract] | ||||
Effective income tax rate, continuing operations, percent | 26.90% | 22.70% | 14.20% | 21.60% |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) - $ / shares shares in Millions | 3 Months Ended | 6 Months Ended | ||
Jan. 29, 2022 | Jan. 30, 2021 | Jan. 29, 2022 | Jan. 30, 2021 | |
Reconciliation of the basic and diluted number of shares used in computing earnings per share: | ||||
Basic weighted average shares outstanding (in shares) | 58.3 | 56.1 | 57.6 | 55.7 |
Net effect of dilutive stock awards based upon the treasury stock method (in shares) | 2.7 | 3.1 | 3.4 | 3.4 |
Diluted weighted average shares outstanding (in shares) | 61 | 59.2 | 61 | 59.1 |
Basic earnings per share: | ||||
Continuing operations (in dollars per share) | $ 1.13 | $ 1.01 | $ 2.47 | $ 0.99 |
Discontinued operations (in dollars per share) | 0 | 0.04 | 0 | 0.05 |
Basic earnings per share (in dollars per share) | 1.13 | 1.05 | 2.47 | 1.04 |
Diluted earnings per share: | ||||
Continuing operations (in dollars per share) | 1.08 | 0.96 | 2.33 | 0.93 |
Discontinued operations (in dollars per share) | 0 | 0.04 | 0 | 0.05 |
Diluted earnings per share (in dollars per share) | $ 1.08 | $ 1 | $ 2.33 | $ 0.98 |
Anti-dilutive stock-based awards excluded from the calculation of diluted earnings per share (in shares) | 0.4 | 1.1 | 0.9 | 1.2 |
BUSINESS SEGMENTS - Narrative (
BUSINESS SEGMENTS - Narrative (Details) | 6 Months Ended |
Jan. 29, 2022segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 2 |
Number of operating segments | 2 |
BUSINESS SEGMENTS - Segment Inf
BUSINESS SEGMENTS - Segment Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jan. 29, 2022 | Jan. 30, 2021 | Jan. 29, 2022 | Jan. 30, 2021 | Jul. 31, 2021 | |
Business segment information | |||||
Net sales | $ 7,416 | $ 6,900 | $ 14,413 | $ 13,584 | |
Net periodic benefit income, excluding service cost | (10) | (17) | (20) | (34) | |
Interest expense, net | 44 | 51 | 84 | 120 | |
Other, net | 2 | 2 | 1 | 3 | |
Restructuring, acquisition and integration related expenses | 5 | 18 | 8 | 34 | |
Income from continuing operations before income taxes | 93 | 75 | 169 | 74 | |
Depreciation and amortization | 69 | 67 | 138 | 144 | |
Payments for capital expenditures | 50 | 51 | 106 | 92 | |
Assets | 7,801 | 7,801 | $ 7,525 | ||
Continuing operations | |||||
Business segment information | |||||
Assets | 7,801 | 7,801 | 7,521 | ||
Operating segments | Wholesale | |||||
Business segment information | |||||
Net sales | 7,132 | 6,618 | 13,866 | 13,056 | |
Adjusted EBITDA | 159 | 188 | 323 | 311 | |
Depreciation and amortization | 61 | 59 | 122 | 127 | |
Payments for capital expenditures | 46 | 46 | 98 | 84 | |
Operating segments | Wholesale | Continuing operations | |||||
Business segment information | |||||
Net sales | 356 | 354 | 695 | 719 | |
Assets | 6,851 | 6,851 | 6,536 | ||
Operating segments | Retail | |||||
Business segment information | |||||
Net sales | 643 | 633 | 1,245 | 1,239 | |
Adjusted EBITDA | 30 | 26 | 52 | 51 | |
Depreciation and amortization | 8 | 7 | 15 | 14 | |
Payments for capital expenditures | 4 | 5 | 8 | 8 | |
Operating segments | Retail | Continuing operations | |||||
Business segment information | |||||
Assets | 597 | 597 | 566 | ||
Operating segments | Other | |||||
Business segment information | |||||
Net sales | 50 | 55 | 106 | 111 | |
Adjusted EBITDA | 12 | (8) | 16 | (4) | |
Depreciation and amortization | 0 | 1 | 1 | 3 | |
Operating segments | Other | Continuing operations | |||||
Business segment information | |||||
Assets | 397 | 397 | 462 | ||
Eliminations | |||||
Business segment information | |||||
Net sales | (409) | (406) | (804) | (822) | |
Adjusted EBITDA | 0 | (2) | (1) | 4 | |
Eliminations | Continuing operations | |||||
Business segment information | |||||
Assets | (44) | (44) | $ (43) | ||
Adjustments | |||||
Business segment information | |||||
Net income attributable to noncontrolling interests | 2 | 2 | 3 | 3 | |
Net periodic benefit income, excluding service cost | 10 | 17 | 20 | 34 | |
Interest expense, net | (44) | (51) | (84) | (120) | |
Other, net | 2 | 2 | 1 | ||
Depreciation and amortization | (69) | (67) | (138) | (144) | |
Share-based compensation | (12) | (13) | (23) | (27) | |
Restructuring, acquisition and integration related expenses | (5) | (18) | (8) | (34) | |
Loss on sale of assets | (1) | 0 | (1) | 0 | |
Multi-employer pension plan withdrawal benefit | 8 | 0 | 8 | 0 | |
Other retail benefit (expense) | $ 1 | $ (1) | $ 1 | $ (3) |
COMMITMENTS, CONTINGENCIES AN_2
COMMITMENTS, CONTINGENCIES AND OFF-BALANCE SHEET ARRANGEMENTS (Details) $ in Millions | Jan. 21, 2021case | Jan. 29, 2022USD ($)case |
Loss Contingencies [Line Items] | ||
Non-cancelable future purchase obligations | $ 225 | |
Multi-District Litigation | ||
Loss Contingencies [Line Items] | ||
Number of suits pending | case | 43 | |
Number of cases consolidated | case | 1,800 | |
Complaint from Various Health Plans | ||
Loss Contingencies [Line Items] | ||
Number of new causes of action | case | 6 | |
Schutte and Yarberry v. SuperValu, New Albertson's, Inc., et al | ||
Loss Contingencies [Line Items] | ||
Alleged damages (in excess of) | $ 100 | |
Share of potential award | $ 24 | |
Moran Foods, LLC | ||
Loss Contingencies [Line Items] | ||
Professional services agreement term | 5 years | |
Professional services agreement, base amount | $ 30 | |
Guarantee Obligations | ||
Loss Contingencies [Line Items] | ||
Estimated loss | 1 | |
Indemnification Agreement | ||
Loss Contingencies [Line Items] | ||
Estimated loss | 0 | |
Payment guarantee | ||
Loss Contingencies [Line Items] | ||
Guarantor obligations, maximum exposure, undiscounted | 25 | |
Guarantor obligations, maximum exposure, discounted | $ 22 | |
Payment guarantee | Minimum | ||
Loss Contingencies [Line Items] | ||
Guarantor obligations, guarantees term | 1 year | |
Payment guarantee | Maximum | ||
Loss Contingencies [Line Items] | ||
Guarantor obligations, guarantees term | 8 years | |
Payment guarantee | Weighted average | ||
Loss Contingencies [Line Items] | ||
Guarantor obligations, guarantees term | 5 years |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended |
Feb. 28, 2022 | Apr. 30, 2022 | |
Forecast | ||
Subsequent Event [Line Items] | ||
Gain from sale-leaseback | $ 85 | |
Subsequent event | ||
Subsequent Event [Line Items] | ||
Purchase of real property of a distribution center | $ 153 | |
Subsequent event | Sale-Leaseback of Distribution Center | ||
Subsequent Event [Line Items] | ||
Proceeds from sale-leaseback | $ 225 | |
Sale-leaseback, lease term | 15 years |