Financial Performance & Growth - PFG's Net Sales CAGR from FY2022 to TTM FY2025 is 61 billion dollars[179] - Gross Profit CAGR from FY2022 to TTM FY2025 is 10.3% with Gross Profit reaching 7.162 billion dollars[180] - Adjusted EBITDA CAGR from FY2022 to TTM FY2025 is 18% with Adjusted EBITDA reaching 1.676 billion dollars[191] - Adjusted Diluted EPS for TTM FY2025 is 4.37 dollars[184] Market & Strategy - PFG's Total Addressable Market (TAM) is approximately 787 billion dollars[21, 24] - PFG's Serviceable Available Market (SAM) is approximately 560 billion dollars[21, 24] - Foodservice segment accounts for 370 billion dollars of both the Total Addressable Market and Serviceable Available Market[24] - Convenience segment accounts for 224 billion dollars of the Total Addressable Market and 138 billion dollars of the Serviceable Available Market[24] - Specialty segment accounts for 193 billion dollars of the Total Addressable Market and 51 billion dollars of the Serviceable Available Market[24] Segment Performance - Foodservice segment TTM FY2025 Sales reached 32.1 billion dollars, with 82% of sales coming from restaurants[66] - Convenience segment TTM FY2025 Sales reached 24.3 billion dollars, with 68% gross profit from Food, Foodservice, and Related Products and 32% gross profit from nicotine[74] - Specialty segment TTM FY2025 Sales reached 4.8 billion dollars[83]

[Special Note Regarding Forward-Looking Statements](index=4&type=section&id=Special%20Note%20Regarding%20Forward-Looking%20Statements) This report contains forward-looking statements subject to risks and uncertainties, including economic factors, supplier reliance, competition, and acquisition-related risks - This report contains forward-looking statements subject to risks and uncertainties, including **economic factors, supplier reliance, competition, cost inflation**, and risks related to **acquisitions** like Cheney Brothers Acquisition[8](index=8&type=chunk)[9](index=9&type=chunk)[12](index=12&type=chunk) [PART I - FINANCIAL INFORMATION](index=6&type=section&id=PART%20I%20-%20FINANCIAL%20INFORMATION) [Financial Statements](index=6&type=section&id=Item%201.%20Financial%20Statements) This section presents unaudited consolidated financial statements, reflecting increased assets and liabilities from the Cheney Brothers acquisition, with higher sales but lower net income due to increased expenses Consolidated Balance Sheet Highlights (Unaudited) | (In millions) | March 29, 2025 | June 29, 2024 | | :--- | :--- | :--- | | Total current assets | $6,788.8 | $6,153.3 | | Goodwill | $3,455.2 | $2,418.3 | | Total assets | $17,123.4 | $13,392.9 | | Total current liabilities | $4,207.1 | $3,758.1 | | Long-term debt | $5,422.7 | $3,198.5 | | Total liabilities | $12,785.9 | $9,266.0 | | Total shareholders' equity | $4,337.5 | $4,126.9 | Consolidated Statements of Operations Highlights (Unaudited) | (In millions, except per share data) | Three Months Ended Mar 29, 2025 | Three Months Ended Mar 30, 2024 | Nine Months Ended Mar 29, 2025 | Nine Months Ended Mar 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net sales | $15,306.3 | $13,857.7 | $46,360.0 | $43,092.0 | | Gross profit | $1,822.4 | $1,568.9 | $5,414.4 | $4,829.9 | | Operating profit | $174.4 | $154.9 | $548.5 | $545.0 | | Net income | $58.3 | $70.4 | $208.7 | $269.4 | | Diluted EPS | $0.37 | $0.45 | $1.34 | $1.72 | Consolidated Statements of Cash Flows Highlights (Unaudited) | (In millions) | Nine Months Ended Mar 29, 2025 | Nine Months Ended Mar 30, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $827.1 | $956.7 | | Net cash used in investing activities | ($2,875.1) | ($533.0) | | Net cash provided by (used in) financing activities | $2,038.6 | ($419.6) | | Net (decrease) increase in cash | ($9.4) | $4.1 | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=29&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) The Cheney Brothers acquisition significantly impacted financial performance, driving sales growth but reducing net income due to higher expenses, while the company also amended its credit facility and issued new senior notes [Business Overview and Key Factors](index=29&type=section&id=Business%20Overview%20and%20Key%20Factors) Performance Food Group, a major North American food distributor, reorganized segments and acquired Cheney Bros., with its business influenced by macroeconomic trends and supply chain dynamics - The company **acquired Cheney Bros., Inc. on October 8, 2024**, expanding Foodservice operations in the Southeastern U.S[94](index=94&type=chunk) - In Q3 fiscal 2025, the company **reorganized its operating segments**, moving certain operations and costs to the Foodservice segment, with prior period data recast[92](index=92&type=chunk) [Consolidated Results of Operations](index=33&type=section&id=Consolidated%20Results%20of%20Operations) Q3 FY2025 saw net sales increase by 10.5% to **$15.3 billion** and gross profit by 16.2% to **$1.8 billion**, but net income declined 17.2% to **$58.3 million** due to higher expenses, while Adjusted EBITDA rose 20.1% to **$385.1 million** Q3 FY2025 vs Q3 FY2024 Consolidated Performance | Metric (In millions) | Q3 FY2025 | Q3 FY2024 | Change (%) | | :--- | :--- | :--- | :--- | | Net Sales | $15,306.3 | $13,857.7 | +10.5% | | Gross Profit | $1,822.4 | $1,568.9 | +16.2% | | Operating Expenses | $1,648.0 | $1,414.0 | +16.5% | | Net Income | $58.3 | $70.4 | -17.2% | | Adjusted EBITDA | $385.1 | $320.7 | +20.1% | - Net sales growth was driven by **recent acquisitions (including Cheney Brothers)**, a **10.0% increase in total case volume**, and approximately **4.9% product cost inflation** in Q3 FY2025[113](index=113&type=chunk)[114](index=114&type=chunk) - Net income declined primarily due to **increased operating expenses, depreciation, amortization, and interest expense** related to recent acquisitions[118](index=118&type=chunk) [Segment Results](index=37&type=section&id=Segment%20Results) Foodservice segment led growth with a 19.2% sales increase driven by the Cheney Brothers acquisition, while Convenience and Specialty segments showed modest sales changes but improved Adjusted EBITDA Foodservice Segment Performance (Q3 FY2025 vs Q3 FY2024) | Metric (In millions) | Q3 FY2025 | Q3 FY2024 | Change (%) | | :--- | :--- | :--- | :--- | | Net Sales | $8,374.5 | $7,023.0 | +19.2% | | Adjusted EBITDA | $275.0 | $213.2 | +29.0% | - The **Cheney Brothers acquisition contributed $931.2 million to Foodservice net sales** in Q3 FY2025, with organic independent case growth at **3.4%**[124](index=124&type=chunk) Specialty Segment Performance (Q3 FY2025 vs Q3 FY2024) | Metric (In millions) | Q3 FY2025 | Q3 FY2024 | Change (%) | | :--- | :--- | :--- | :--- | | Net Sales | $1,131.2 | $1,133.8 | -0.2% | | Adjusted EBITDA | $77.9 | $72.9 | +6.9% | Convenience Segment Performance (Q3 FY2025 vs Q3 FY2024) | Metric (In millions) | Q3 FY2025 | Q3 FY2024 | Change (%) | | :--- | :--- | :--- | :--- | | Net Sales | $5,740.0 | $5,640.1 | +1.8% | | Adjusted EBITDA | $74.7 | $70.9 | +5.4% | [Liquidity and Capital Resources](index=41&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity was impacted by financing the Cheney Brothers acquisition through an amended $5.0 billion ABL Facility and $1.0 billion in new senior notes, leading to decreased operating cash flow and increased investing cash outflow - On September 9, 2024, the company **amended its credit agreement**, increasing the ABL Facility from **$4.0 billion to $5.0 billion** and extending maturity to September 9, 2029[155](index=155&type=chunk) - On September 12, 2024, the company **issued $1.0 billion of 6.125% Senior Notes due 2032** to help finance the Cheney Brothers acquisition[52](index=52&type=chunk)[168](index=168&type=chunk) Cash Flow Summary (Nine Months Ended) | (In millions) | March 29, 2025 | March 30, 2024 | | :--- | :--- | :--- | | Net cash from operating activities | $827.1 | $956.7 | | Net cash used in investing activities | ($2,875.1) | ($533.0) | | Net cash from (used in) financing activities | $2,038.6 | ($419.6) | - The company **repurchased 0.6 million shares for $44.2 million** during the nine months ended March 29, 2025, with approximately **$166.4 million remaining** under the share repurchase program[145](index=145&type=chunk)[146](index=146&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=36&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company's primary market risks are interest rate and fuel price fluctuations, with increased variable-rate debt exposure from the Cheney Brothers Acquisition potentially raising annual interest expense by **$22.4 million** for a 100 basis point SOFR increase - The company's **variable-rate debt increased** due to the Cheney Brothers Acquisition[182](index=182&type=chunk) - A hypothetical **100 basis point increase in SOFR** on approximately **$2.2 billion of variable-rate debt** would increase annual interest expense by about **$22.4 million**[183](index=183&type=chunk) [Controls and Procedures](index=36&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded the company's disclosure controls and procedures were effective as of March 29, 2025, with no material changes to internal control over financial reporting, excluding the recently acquired Cheney Brothers - The Principal Executive Officer and Principal Financial Officer concluded that the Company's **disclosure controls and procedures were effective** as of March 29, 2025[185](index=185&type=chunk) - The internal control evaluation for the quarter **excluded Cheney Brothers**, acquired on October 8, 2024[187](index=187&type=chunk) [PART II - OTHER INFORMATION](index=37&type=section&id=PART%20II%20-%20OTHER%20INFORMATION) [Legal Proceedings](index=37&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in JUUL litigation, with an MDL settlement releasing subsidiaries, but an ongoing Illinois state lawsuit has a trial date of October 6, 2025, with JUUL providing defense and indemnification - A **settlement in the JUUL Multidistrict Litigation (MDL)** has released the company's subsidiaries, Core-Mark and Eby-Brown, from claims[74](index=74&type=chunk) - A separate lawsuit against the company's subsidiaries regarding JUUL products is ongoing in Illinois state court, with a **trial date of October 6, 2025**, and JUUL is providing defense and indemnification[75](index=75&type=chunk) [Risk Factors](index=37&type=section&id=Item%201A.%20Risk%20Factors) No material changes to the company's principal risk factors were reported since the last Annual Report on Form 10-K - No **material changes to principal risk factors** were reported since the last Form 10-K filing[190](index=190&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=37&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) In Q3 FY2025, the company repurchased **138,335 shares for $10.6 million**, with **$166.4 million remaining** under the **$300 million** share repurchase authorization expiring November 2026 Share Repurchases (Q3 FY2025) | Period | Total Shares Purchased | Average Price Paid | Shares Purchased as Part of Plan | | :--- | :--- | :--- | :--- | | Dec 29, 2024 – Mar 29, 2025 | 154,817 | $77.91 | 138,335 | - As of March 29, 2025, approximately **$166.4 million remained available** for share repurchases under the authorized plan[193](index=193&type=chunk) [Defaults Upon Senior Securities](index=37&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) No defaults upon senior securities were reported during the period - None[194](index=194&type=chunk) [Mine Safety Disclosures](index=37&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[195](index=195&type=chunk) [Other Information](index=38&type=section&id=Item%205.%20Other%20Information) Several executive officers adopted Rule 10b5-1 trading plans for future sale of company securities during Q3 FY2025 - Several directors and Section 16 officers, including the **CFO, Chief Development Officer, and General Counsel**, adopted Rule 10b5-1 trading plans during the quarter ended March 29, 2025[196](index=196&type=chunk) [Exhibits](index=39&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including CEO and CFO certifications and Inline XBRL data files - Exhibits filed include **CEO/CFO certifications** under Sarbanes-Oxley Sections 302 and 906, and **Inline XBRL documents**[197](index=197&type=chunk)

Core Insights - Performance Food Group (PFGC) reported revenue of $15.31 billion for the quarter ended March 2025, reflecting a year-over-year increase of 10.5% [1] - The earnings per share (EPS) for the same period was $0.79, slightly down from $0.80 a year ago [1] - The reported revenue was a surprise of -0.73% compared to the Zacks Consensus Estimate of $15.42 billion, while the EPS fell short by -8.14% against the consensus estimate of $0.86 [1] Revenue Breakdown - Revenue from Convenience was $5.74 billion, slightly above the estimated $5.73 billion [4] - Revenue from Intersegment Eliminations was reported at -$160.90 million, better than the average estimate of -$176.98 million [4] - Revenue from Corporate & All Other was $221.50 million, below the average estimate of $247.51 million [4] - Foodservice revenue was $8.37 billion, slightly below the average estimate of $8.40 billion [4] Stock Performance - Performance Food's shares have returned +12.9% over the past month, outperforming the Zacks S&P 500 composite's +10.6% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the broader market in the near term [3]

Financial Data and Key Metrics Changes - Total net sales grew by 10.5% in Q3 2025, driven by acquisitions and volume growth [24] - Adjusted EBITDA increased by 20.1% to $385.1 million, with net income reported at $58.3 million [27] - Total company cost inflation was approximately 4.9%, with foodservice product cost inflation at 3.7% [25][26] Business Line Data and Key Metrics Changes - Foodservice segment saw organic independent case growth of 3.4% for the full third quarter, with a rebound to 6% in April [13][24] - Chain restaurant business grew cases by 1.5%, supported by new business onboarding [14] - Convenience segment volume grew by approximately 1%, outperforming the industry, while Specialty segment net sales were roughly flat [18][19] Market Data and Key Metrics Changes - The macroeconomic environment remains challenging, with consumer performance described as muted [5][10] - Despite challenges, the company gained market share across all three segments [20] - Inflation rates in foodservice are considered manageable, with ongoing monitoring of commodity prices [15][25] Company Strategy and Development Direction - The company aims to capture growth through a diversified food distribution strategy, focusing on both top and bottom line growth [7] - Strategic priorities include leveraging proprietary brands and procurement synergies to expand gross margins [12] - The company plans to discuss its long-term strategy at the upcoming Investor Day [7][31] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate the current economic landscape and capture market share [10][31] - The company remains cautious about the macro environment but optimistic about recent sales trends [49][50] - Future guidance reflects a conservative approach due to competitive pressures and economic uncertainty [30][31] Other Important Information - The Specialty segment was renamed to align with the company's naming conventions, with no operational changes [21] - The company has a robust M&A pipeline and continues to evaluate strategic acquisition opportunities [30][29] Q&A Session Summary Question: Insights on consumer demand and behavior - Management noted that independent case volume was strong at the beginning of the quarter but faced setbacks in February due to weather and economic uncertainty [36][39] Question: Outlook on food inflation - Management indicated that food inflation is expected to remain in the mid-single digits, with minimal impact from tariffs [41][44] Question: Trends in organic independent case growth - Management acknowledged a robust recovery in April but emphasized caution due to calendar differences and market conditions [48][50] Question: Changes in competition and market share - Management observed increased competition in the industry, particularly among smaller competitors, but noted that larger distributors are gaining market share [81] Question: Margin expectations for Q4 - Management expects minimal EBITDA margin expansion in Q4, influenced by strong prior year comparisons and ongoing productivity measures [98][100]

Core Viewpoint - Performance Food Group (PFGC) reported quarterly earnings of $0.79 per share, missing the Zacks Consensus Estimate of $0.86 per share, and showing a decline from $0.80 per share a year ago, indicating an earnings surprise of -8.14% [1][2] Financial Performance - The company posted revenues of $15.31 billion for the quarter ended March 2025, which was 0.73% below the Zacks Consensus Estimate, compared to $13.86 billion in the same quarter last year [2] - Over the last four quarters, Performance Food has surpassed consensus EPS estimates only once [2] Stock Performance - Performance Food shares have decreased by approximately 4.1% since the beginning of the year, while the S&P 500 has declined by 4.7% [3] Future Outlook - The company's earnings outlook is crucial for investors, as it includes current consensus earnings expectations for upcoming quarters and any recent changes to these expectations [4] - The current consensus EPS estimate for the upcoming quarter is $1.56 on revenues of $16.86 billion, and for the current fiscal year, it is $4.55 on revenues of $63.33 billion [7] Industry Context - The Food - Natural Foods Products industry, to which Performance Food belongs, is currently ranked in the top 14% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% of industries [8]

Exhibit 99.1 NEWS RELEASE For Immediate Release Investors: Media: William S. Marshall Scott Golden (804) 287-8108 (804) 484-7873 Bill.Marshall@pfgc.com Scott.Golden@pfgc.com SVP, Investor Relations Director, Communications & Engagement Performance Food Group Company Reports Third-Quarter and First-Nine Months Fiscal 2025 Results Strong Sales Momentum; Updates Full-Year Financial Guidance Third-Quarter Fiscal 2025 Highlights First-Nine Months Fiscal 2025 Highlights RICHMOND, Va. – May 7, 2025 – Performance F ...

Financial Performance - Net sales for the three months ended December 28, 2024, increased by 9.4% to $15,638.2 million compared to $14,295.7 million for the same period in 2023[109] - Gross profit for the three months ended December 28, 2024, rose by 14.4% to $1,827.8 million, up from $1,598.1 million in the prior year[109] - Adjusted EBITDA for the three months ended December 28, 2024, increased by 22.5% to $423.0 million, compared to $345.4 million for the same period in 2023[109] - For the six months ended December 28, 2024, net sales increased by 6.2% to $31,053.7 million compared to $29,234.3 million in the same period in 2023[109] - Net sales increased by $1,342.5 million, or 9.4%, for the second quarter of fiscal 2025 compared to the same period in fiscal 2024[111] - Total case volume increased by 9.8% in the second quarter of fiscal 2025 and 6.1% in the first six months compared to the same periods in fiscal 2024[112] - Gross profit rose by $229.7 million, or 14.4%, for the second quarter of fiscal 2025 compared to the second quarter of fiscal 2024[113] - Total Adjusted EBITDA for the second quarter of fiscal 2025 was $423.0 million, an increase of $77.6 million, or 22.5%, compared to the second quarter of fiscal 2024[121] Operating Expenses - Operating expenses for the three months ended December 28, 2024, increased by 17.2% to $1,669.0 million, compared to $1,424.2 million in the prior year[109] - Operating expenses increased by $244.8 million, or 17.2%, for the second quarter of fiscal 2025 compared to the same period in fiscal 2024[114] - Operating expenses for Foodservice rose by $157.0 million, or 20.8%, from Q2 FY2024 to Q2 FY2025, primarily due to recent acquisitions and a $38.0 million increase in personnel expenses[124] Net Income and Tax - Net income (GAAP) for the three months ended December 28, 2024, decreased by 45.8% to $42.4 million, down from $78.3 million in the same period last year[109] - The company reported a decrease in income before income taxes by 49.2% to $56.7 million for the three months ended December 28, 2024[109] - Net income decreased by $35.9 million, or 45.8%, for the second quarter of fiscal 2025 compared to the second quarter of fiscal 2024[117] - The effective tax rate for the second quarter of fiscal 2025 was 25.2%, down from 29.9% in the same period of fiscal 2024[118] Acquisitions - The company acquired Cheney Bros., Inc. on October 8, 2024, enhancing its Foodservice operations in the Southeastern United States[96] - The acquisition of Cheney Brothers contributed $825.0 million to net sales in the second quarter of fiscal 2025[122] - The increase in variable-rate debt is attributed to the Cheney Brothers acquisition[180] Cash Flow and Investments - Cash balance as of December 28, 2024, totaled $18.7 million, down from $27.7 million as of June 29, 2024[146] - Operating activities provided cash flow of $379.0 million in the first six months of FY2025, a decrease from $554.0 million in FY2024, largely due to advanced inventory purchases[147] - Cash used in investing activities totaled $2,736.7 million in the first six months of fiscal 2025, a significant increase from $436.4 million in the same period of fiscal 2024[148] - Acquisitions accounted for $2,535.5 million of the investing activities in the first six months of fiscal 2025, compared to $308.1 million in fiscal 2024[148] - Capital purchases of property, plant, and equipment were $203.9 million in the first six months of fiscal 2025, up from $147.1 million in fiscal 2024[149] Debt and Financing - Aggregate borrowings as of December 28, 2024, were $2,660.7 million, with an average interest rate of 6.05%[155] - The ABL Facility increased total revolving commitments from $4.0 billion to $5.0 billion and extended the maturity date to September 9, 2029[152] - The proceeds from the Notes due 2032, totaling $1.0 billion, were initially intended for the acquisition of Cheney Brothers but were used to pay down a portion of the ABL Facility[167] - The Notes due 2027 and 2029 were issued at 100.0% of their par value, with interest rates of 5.500% and 4.250%, respectively[157][161] - The ABL Facility contains covenants requiring maintenance of a minimum consolidated fixed charge coverage ratio if Alternate Availability falls below $375.0 million[156] - The Company may redeem the Notes due 2032 at a redemption price equal to 100% of the principal amount redeemed plus accrued interest, with specific conditions for early redemption[169] - As of December 28, 2024, the restricted payment capacity available under debt agreements is approximately $1,428.4 million[171] Assets and Market Risks - Total assets for the Foodservice segment increased by $3,961.2 million from $6,582.5 million as of December 30, 2023, to $10,543.7 million as of December 28, 2024, primarily due to recent acquisitions[174] - Total assets for the Vistar segment increased by $131.6 million from $1,434.9 million as of December 30, 2023, to $1,566.5 million as of December 28, 2024, driven by advanced purchases of products and warehouse expansion[175] - Total assets for the Convenience segment increased by $96.5 million from $4,085.7 million as of December 30, 2023, to $4,182.2 million as of December 28, 2024, due to advanced purchases of tobacco products and new warehouse facilities[177] - The company is in compliance with all covenants under the ABL Facility and the indentures governing the Notes due 2027, 2029, and 2032 as of December 28, 2024[172] - Approximately $150.0 million of the company's outstanding long-term debt is fixed through interest rate swap agreements, while approximately $2.5 billion represents variable-rate debt[181] - A hypothetical 100 bps increase in SOFR on the variable-rate debt would lead to an increase of approximately $25.1 million in annual interest expense[181] - The company’s market risks consist of interest rate risk and fuel price risk, with no material changes since June 29, 2024[180] Accounting Policies - There have been no material changes to the company's critical accounting policies and estimates compared to those described in the Form 10-K[179]

Financial Data and Key Metrics Changes - Total net sales grew by 9.4% in the fiscal second quarter, aided by acquisitions of Jose Santiago and Cheney Brothers, with organic independent cases up 5% [44][45][51] - Adjusted EBITDA increased by 22.5% to $423 million, exceeding guidance [51][52] - Diluted earnings per share was $0.27, while adjusted diluted earnings per share improved by 8.9% year-over-year to $0.98 [52] Business Line Data and Key Metrics Changes - Foodservice segment saw strong performance with organic independent case growth of 5%, driven by new account growth and improved margins [30][34] - Convenience segment experienced mid-single-digit growth in foodservice cases, with adjusted EBITDA at 28.5% [36][50] - Vistar segment reported low single-digit case increases, with growth in office coffee services and theater channels [39][40] Market Data and Key Metrics Changes - Organic independent restaurant case volume grew by 5% in the second quarter, up from 4.3% in the first quarter [9][10] - Vistar's total cases grew by 1.4% in the fiscal second quarter, with positive growth in vending and office coffee services [11][39] - Convenience business showed resilience despite industry challenges, with foodservice cases increasing at a mid-single-digit pace [36][50] Company Strategy and Development Direction - The company is focused on targeted acquisitions to drive growth, with successful integration of Jose Santiago and Cheney Brothers [6][15] - A diversification strategy across the food away from home market is emphasized, providing long-term growth opportunities [18] - Continued investment in sales force hiring, with a nearly 7% increase in headcount, is aimed at driving organic growth [34][150] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism for the second half of fiscal 2025, anticipating a rebound in independent case growth [10][46] - Challenges in the Vistar segment are acknowledged, but improvements are expected in the latter half of the fiscal year [50][70] - The company is monitoring inflationary pressures, with total company cost inflation at 4.6% for the second quarter [47][101] Other Important Information - The company plans to prioritize debt reduction in the short term while maintaining a robust M&A pipeline [57][138] - Capital expenditures are expected to remain steady at approximately $100 million per quarter, with additional investments for growth projects at Cheney Brothers and Jose Santiago [54][56] - The effective tax rate for the second quarter was 25.2%, with expectations for a higher rate in the latter half of the fiscal year [52] Q&A Session Summary Question: Which segments are contributing to the higher sales outlook? - Management noted broad-based growth across all three segments, with independent growth being particularly strong [64][66] Question: Can you elaborate on cost of goods optimization? - Management confirmed that cost of goods optimization has been a focus, with collaborative efforts across segments driving improvements [70][72] Question: Thoughts on underlying momentum in the food service business? - Management indicated that underlying EBITDA growth is strong, with expectations for continued improvement in the second half of the year [75][76] Question: What is the inflation outlook? - Management expects inflation to remain manageable, with foodservice inflation projected in the low to mid-single digits [101][102] Question: How is Cheney Brothers performing post-acquisition? - Cheney Brothers is performing exceptionally well, with aggressive hiring and strong sales growth despite challenges [121][122] Question: What is the current leverage level? - Current leverage is in the high threes, with plans to reduce it back within the target range of 2.5 to 3.5 times [141][136]

Core Insights - Performance Food Group (PFGC) reported revenue of $15.64 billion for the quarter ended December 2024, marking a year-over-year increase of 9.4% [1] - The earnings per share (EPS) for the same period was $0.98, compared to $0.90 a year ago, although it fell short of the consensus estimate of $1.03 by 4.85% [1] - The reported revenue exceeded the Zacks Consensus Estimate of $15.52 billion by 0.78% [1] Revenue Breakdown - Convenience revenue reached $5.97 billion, slightly above the estimated $5.96 billion [4] - Foodservice revenue was $8.37 billion, surpassing the average estimate of $8.24 billion [4] - Eliminations revenue was reported at -$172.40 million, compared to the estimated -$164.36 million [4] - Corporate & All Other revenue was $240.20 million, close to the average estimate of $241.28 million [4] - Vistar revenue was $1.23 billion, slightly below the average estimate of $1.24 billion [4] Stock Performance - Shares of Performance Food have returned +6.9% over the past month, outperforming the Zacks S&P 500 composite's +1.7% change [3] - The stock currently holds a Zacks Rank 2 (Buy), indicating potential for outperformance in the near term [3]

Group 1: Earnings Performance - Performance Food Group (PFGC) reported quarterly earnings of $0.98 per share, missing the Zacks Consensus Estimate of $1.03 per share, but showing an increase from $0.90 per share a year ago, resulting in an earnings surprise of -4.85% [1] - Over the last four quarters, the company has surpassed consensus EPS estimates only once, with revenues of $15.64 billion for the quarter ended December 2024, exceeding the Zacks Consensus Estimate by 0.78% compared to $14.3 billion a year ago [2] Group 2: Stock Performance and Outlook - Performance Food shares have increased approximately 7.2% since the beginning of the year, outperforming the S&P 500's gain of 2.7% [3] - The company's earnings outlook is crucial for investors, as it includes current consensus earnings expectations for upcoming quarters and any recent changes to these expectations [4] Group 3: Estimate Revisions and Industry Ranking - The estimate revisions trend for Performance Food is currently favorable, leading to a Zacks Rank 2 (Buy) for the stock, indicating expected outperformance in the near future [6] - The current consensus EPS estimate for the upcoming quarter is $0.91 on revenues of $15.24 billion, and for the current fiscal year, it is $4.74 on revenues of $62.87 billion [7] - The Food - Natural Foods Products industry is ranked in the top 21% of over 250 Zacks industries, suggesting that stocks in the top 50% of Zacks-ranked industries outperform those in the bottom 50% by more than 2 to 1 [8]