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Core Viewpoint - Performance Food Group Company (NYSE:PFGC) is recognized as one of the best FMCG stocks to invest in, despite a recent price target reduction by UBS from $120 to $108 while maintaining a "Buy" rating, indicating a stable growth outlook for the company [1]. Financial Performance - For Q2 2026, Performance Food Group reported a 5.2% year-over-year increase in net sales, reaching $16.4 billion, driven by higher case sales and increased selling prices per case [3]. - The company's total case volume rose by 3.4% year-over-year, with organic case volume increasing by 2.8% due to a 5.3% rise in organic independent cases [2]. - Net income for Q2 2026 increased by $19.3 million year-over-year to $61.7 million, supported by higher gross profit, although this was partially offset by increased operating expenses, income taxes, and interest expenses [3]. Future Outlook - For Q3 2026, Performance Food Group anticipates net sales to be between approximately $16.0 billion and $16.3 billion, indicating continued growth in the upcoming quarter [4].

Core Viewpoint - Performance Food Group Company announced the pricing of its offering of $1.06 billion aggregate principal amount of 5.625% Senior Notes due 2034, with the offering expected to close on February 19, 2026, subject to customary closing conditions [1]. Group 1 - The offering consists of 5.625% Senior Notes due 2034 [1]. - The total amount of the offering is $1.06 billion [1]. - The net proceeds from the offering will be utilized by the company for unspecified purposes [1].

Core Viewpoint - Performance Food Group Company announced the intention to offer $1.06 billion in Senior Notes due 2034 to redeem outstanding 5.500% Senior Notes [1] Group 1 - The offering is subject to market and other conditions [1] - The net proceeds from the offering will be used alongside borrowings from the revolving credit facility [1] - The Issuer is an indirect wholly-owned subsidiary of Performance Food Group Company [1]

Management reiterated confidence in longer-term targets disclosed previously, emphasizing a combination of market share gains, margin enhancement and operating leverage. McPherson also pointed to technology as an area of personal focus, alongside continued organic growth and acquisitions.McPherson opened the call by recognizing Holm’s retirement after nearly 25 years with the company and said Holm will remain active as executive chair, particularly in strategic M&A, customer relationships, and overarching s ...

Financial Performance - Net sales for the three months ended December 27, 2025, were $16,444.7 million, an increase of 5.2% compared to $15,638.2 million for the same period in 2024[16] - Gross profit for the six months ended December 27, 2025, was $3,983.0 million, up from $3,592.0 million in the prior year, reflecting a 10.9% increase[16] - Net income for the three months ended December 27, 2025, was $61.7 million, compared to $42.4 million for the same period in 2024, representing a 45.4% increase[16] - Operating profit for the three months ended December 27, 2025, was $190.1 million, an increase from $158.8 million in the prior year, marking a 19.7% growth[16] - Net income for the six months ended December 27, 2025, was $155.3 million, an increase of 2.9% from $150.4 million for the same period in 2024[24] - The company reported a total comprehensive income of $62.6 million for the three months ended December 27, 2025, compared to $40.0 million for the same period in 2024[19] - Basic earnings per share for the six months ended December 27, 2025, were $1.00, compared to $0.97 for the same period in 2024[16] - The company reported a net income before taxes of $86.7 million for Q4 2025, compared to $56.7 million in Q4 2024, marking a significant increase of 52.7%[103] Assets and Liabilities - Total assets as of December 27, 2025, were $18,182.8 million, an increase from $17,881.2 million as of June 28, 2025[14] - Total liabilities increased to $13,534.2 million as of December 27, 2025, compared to $13,408.8 million as of June 28, 2025[14] - Retained earnings rose to $1,798.4 million as of December 27, 2025, from $1,643.1 million as of June 28, 2025[14] - As of December 27, 2025, total debt, excluding current installments, was $5,274.1 million, down from $5,388.8 million as of June 28, 2025[48] - The fair value of long-term debt was $5,305.7 million as of December 27, 2025, compared to a carrying value of $5,274.1 million[72] Cash Flow and Investments - The company’s cash position decreased to $41.0 million as of December 27, 2025, from $78.5 million as of June 28, 2025[14] - Net cash provided by operating activities increased to $456.0 million, up 20.4% from $379.0 million in the prior year[24] - Cash paid for interest during the year was $207.4 million, compared to $146.3 million in the previous year, reflecting a significant increase[25] - Net cash used in investing activities was $251.6 million, a decrease from $2,736.7 million in the prior year, indicating a significant reduction in investment outflows[24] - The company reported a net decrease in cash and restricted cash of $37.2 million, compared to a decrease of $9.0 million in the same period last year[24] Shareholder Actions - The company authorized a share repurchase program of up to $500 million, replacing a previous program of $300 million, with $500 million remaining available as of December 27, 2025[29] - The company had total purchase obligations of $273.2 million as of December 27, 2025, including commitments for capital projects and services[157] - The company has $500 million remaining available for share repurchases under the authorized program as of December 27, 2025[181] Segment Performance - Segment Adjusted EBITDA for Foodservice was $292.1 million in Q4 2025, up from $285.1 million in Q4 2024, indicating a year-over-year increase of 1.9%[103] - Foodservice segment net sales increased by $1,868.7 million, or 11.6%, for the first six months of fiscal 2026 compared to the prior year[137] - Convenience segment net sales rose by $586.7 million, or 4.8%, for the first six months of fiscal 2026[137] - Specialty segment net sales increased by $8.6 million, or 0.3%, in the first half of fiscal 2026, primarily due to higher selling prices despite a decline in theater sales[147] Tax and Legal Matters - The Company's effective tax rate was 28.8% for the three months ended December 27, 2025, compared to 25.2% for the same period in 2024, and 25.4% for the six months ended December 27, 2025, compared to 26.1% for the same period in 2024[76] - The Company had net deferred tax assets of $250.9 million and deferred tax liabilities of $1,154.4 million as of December 27, 2025, reflecting changes due to modifications of U.S. tax law[77] - The Company is engaged in various legal proceedings, but management does not believe the outcomes will materially affect its financial position[81] Market and Strategic Outlook - The company serves both independent and multi-unit customers in the restaurant industry, distributing a wide range of food and food-related products across North America[28] - Future strategies include focusing on independent sales, expanding geographies, and pursuing strategic acquisitions to drive growth[121] - The food distribution market structure favors larger distributors, allowing the company to benefit from economies of scale and enhance customer satisfaction[121] - The company is currently evaluating the impact of several recently issued accounting standards on its future consolidated financial statements[33][35][38]

Core Insights - Performance Food Group (PFGC) reported revenue of $16.44 billion for the quarter ended December 2025, marking a year-over-year increase of 5.2% [1] - The earnings per share (EPS) for the same period was $0.98, unchanged from the previous year, but below the consensus estimate of $1.07, resulting in an EPS surprise of -8.09% [1] - The reported revenue fell short of the Zacks Consensus Estimate of $16.56 billion, leading to a surprise of -0.71% [1] Revenue Breakdown - Convenience revenue reached $6.33 billion, exceeding the two-analyst average estimate of $6.24 billion, with a year-over-year change of +6.1% [4] - Foodservice revenue was reported at $8.8 billion, below the estimated $9.01 billion from two analysts [4] - Intersegment Eliminations revenue was -$181.4 million, slightly worse than the estimated -$175.96 million, but showed a year-over-year improvement of +5.2% [4] - Corporate & All Other revenue was $239.7 million, marginally below the average estimate of $240.64 million, reflecting a -0.2% change year over year [4] - Specialty revenue totaled $1.25 billion, slightly below the estimated $1.26 billion, with a year-over-year increase of +1.5% [4] Stock Performance - Shares of Performance Food have returned +11% over the past month, significantly outperforming the Zacks S&P 500 composite, which saw a change of +0.9% [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the broader market in the near term [3]

Performance Food Group Company (NYSE:PFGC) Q2 2026 Earnings call February 04, 2026 09:00 AM ET Company ParticipantsBen Wood - VP of Equity ResearchBill Marshall - SVP and Head of Investor RelationsEdward Kelly - Managing Director and Equity Research analystPatrick Hatcher - CFOScott McPherson - EVP and Chief Field Operations OfficerConference Call ParticipantsAlex Slagle - SVP and Equity Research AnalystBrian Harbour - Executive Director and Senior Equity Research AnalystDanilo Gargiulo - Senior AnalystJeff ...

Financial Data and Key Metrics Changes - PFG's total net sales grew by 5.2% in Q2 2026, with total company cases increasing by 3.4% [19] - Net income reached $61.7 million, a 45.5% increase year-over-year [21] - Adjusted EBITDA increased by 6.7% to $451 million, with diluted earnings per share at $0.39 and adjusted diluted earnings per share flat at $0.98 year-over-year [22] Business Line Data and Key Metrics Changes - Food service segment delivered 5.3% organic independent case growth, driven by a 5.8% independent account growth [7] - Convenience segment net sales increased by 6.1%, benefiting from market share gains and onboarding of new accounts [13] - Specialty segment saw modest improvement in top-line trends, with sales growth in vending, office coffee, retail, campus, and travel channels [16] Market Data and Key Metrics Changes - Industry-wide foot traffic decelerated, with December traffic down 3.5% [9] - Convenience segment sales were driven by low single-digit dollar growth from food and mid-teen non-combustible nicotine product sales growth [14] - Total company cost inflation was approximately 4.5%, with food service inflation at 1.8% and convenience cost inflation at 7.4% [20] Company Strategy and Development Direction - The company is focused on a three-year strategic vision aimed at revenue growth, market share gains, gross margin enhancement, and improving operating leverage [6] - PFG is committed to pursuing strategic M&A opportunities, with a robust pipeline and a history of successful acquisitions [25] - The integration of Cheney Brothers is expected to contribute significantly to revenue and profit growth in the future, with synergies anticipated to flow through in years two and three post-acquisition [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to drive growth and EBITDA performance despite a challenging macro environment [6] - The company anticipates a modest sequential decline in net interest expense and expects to maintain a tax rate close to historical averages [23][24] - Management remains optimistic about achieving the full-year guidance and the three-year projections announced at Investor Day [27] Other Important Information - The company generated $456 million of operating cash flow in the first half of 2026, an increase of $77 million compared to the same period last year [24] - PFG did not repurchase any shares under its share repurchase program in the quarter, prioritizing debt reduction instead [25] Q&A Session Summary Question: Can you provide additional color on performance by month for organic independent case growth? - Management noted strong performance in October, followed by a decline due to the government shutdown, with a rebound in January despite weather impacts [30][32] Question: How did the pace of your sales force growth compare to recent quarters? - The sales force growth remained consistent at around 6%, with a focus on market share performance [34] Question: Can you discuss the dynamics at play for the food service business in the second quarter? - Management highlighted strong independent growth but noted elevated operating expenses due to Cheney investments and deflation in cheese and poultry [38][40] Question: What is the outlook for the convenience segment's EBITDA margins? - Management expressed optimism about margin expansion due to growth in food service and non-combustible nicotine products [42][44] Question: How is the company managing procurement opportunities? - Management indicated confidence in achieving procurement synergies over the three-year plan, with progress expected in the back half of the year [47][49] Question: What is the impact of deflation on margins? - Deflation is expected to impact margins, particularly in cheese and poultry, which the company overindexes [50][91] Question: How does the company view the competitive environment? - Management noted consistent market share gains and did not observe significant changes in the competitive landscape [82]

Exhibit 99.1 1 This earnings release includes several metrics, including Adjusted EBITDA, Adjusted Diluted Earnings Per Share, and Free Cash Flow, that are not calculated in accordance with Generally Accepted Accounting Principles in the U.S. ("GAAP"). Please see "Statement Regarding Non-GAAP Financial Measures" at the end of this release for the definitions of such non-GAAP financial measures and reconciliations of such non-GAAP financial measures to their respective most comparable financial measures calc ...