Stocks of two natural products companies make Top 20 list

Two natural products companies have earned a spot in this year's World's Top 20 Sustainable Stocks by The annual SB20 List is presented in the green investment newsletter Progressive Investor.

The two companies are French ingredients-supplier Naturex (France: NRX.PA),and United Natural Foods Inc. (Nasdaq: UNFI), the largest wholesale distributor to the natural and organic industry in the United States.

The eighth annual SB20 List consists of 20 public companies that are leading the way to a sustainable economy. A group of judges,who are among the top green stock analysts in the world, selected the 20 companies.

"To be on the list, companies must be strong on both the green and financial sides," Sustainable Business said. "It is not a 'buy' list, but because the companies are strong financially, their stock may well be worth buying at some point based on stock market positioning. We strive to choose companies of various sizes, industries and parts of the world, but the list doesn't constitute a diversified portfolio."

To be included in the SB20 list, a company must be a leading example of sustainable business, with excellent environmental practices. The company must also have a history of healthy profitability and be considered by the judges to be a good long-term investment opportunity.

Every company on the 2009 SB20 List has continued to grow their business during the recession, dominating their particular industry niche. Corporate pioneers have continued innovating on the green side despite the recession, an aspect that is increasingly viewed as a sign of management excellence and stronger financial performance.

Founded in Avignon, France, in 1992, Naturex employs 550 people worldwide and focuses on the development of plant extracts with flavouring, colouring, antioxidant and nutraceutical properties. It has facilities in Morocco, New Jersey, California and Milan, Italy.

It has been listed on the Paris Stock Exchange since 1996.

"Naturex was selected for this year's SB20 List in the 'sustainable food' category because it produces products from plant extracts, replacing chemical ingredients," says Rona Fried, PhD, the CEO of Sustainable Business. "Besides being plant-based, its flavourings, colourings, antioxidants and preservatives are GMO-free and not tested on animals, providing a much healthier and environmentally responsible alternative for the food industry. Such ingredients are found throughout the food industry; therefore Naturex has the potential to make an important contribution on a large scale."

Naturex had a strong year in 2008; it enjoyed double-digit sales growth in constant dollars and outperformed its earnings target with an operating margin of 12.1 per cent.

"This extremely rapid return to double-digit profit growth is concrete proof of our capacity to effectively integrate the strategic acquisitions we have made in the past few years, and is all the more impressive given the historical weakness of the dollar," said chairman and CEO Jacques Dikansky, in an open letter to investors. "Fortified by these strong results and a financial structure reinforced by a highly successful capital increase of €17.3 million in February 2009, Naturex is ideally placed to pursue its ambitious growth strategy."

Naturex has three business lines: Food & Beverage, Nutrition & Heath,and Personal Care. It is continuing its global expansion, looking inparticular to Asia.

"Asia currentlyrepresents between 15 and 20 per cent of the market worldwide, and we have yet to develop a genuine market presence (there)," Dikansky said. "With this in mind, we set up a subsidiary in China in 2008 and have a sales office in Japan planned for 2009."

UnitedNatural Foods Inc.

Connecticut-based UNFI has been on the SB20 list forsix of the past eight years.

UNFI is a leading independent distributor of natural, organic and speciality foods and related products, including nutritional supplements, personal careitems and organic produce, in the United States — as well as 40 other countries.

Carrying more than 40,000 SKUs, the company supplies to over 17,000 customers nationwide and serves a wide variety of retail formats, including supernatural chains,independent natural products retailers, conventional supermarkets and foodservice customers.

In 2007, the company's sales increased 13.2 per cent to $2.8 billion from the $2.4 billion the prior year.

The company has gotten plenty of attention of late. It received the 2008 Sustainability Excellence Award by Supermarket News, was named "One of America's Best Big Companies 2005-2008 by Forbes Magazine, was named "One of America's Most Admired Companies" by Forbes in 2006, 2007 and 2009, and was ranked among "100 Best Corporate Citizens for 2006" by Business Ethics.

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