Performance Food pany(US:PFGC)2025-05-07 11:00Financial Performance - Net sales for Q3 FY2025 grew 10.5% to $15.3 billion, driven by acquisitions and a favorable shift in case mix[8] - Gross profit for Q3 FY2025 improved 16.2% to $1.8 billion, supported by procurement efficiencies and growth in the independent channel[9] - Adjusted EBITDA for Q3 FY2025 rose 20.1% to $385.1 million, reflecting strong operational performance[12] - Net income for Q3 FY2025 decreased 17.2% to $58.3 million, impacted by increased depreciation and interest expenses[11] - For the first nine months of FY2025, net sales increased 7.6% to $46.4 billion, primarily due to recent acquisitions and inflation[14] - Adjusted EBITDA for fiscal year 2025 is projected to be in the range of $1.725 billion to $1.75 billion, down from the prior range of $1.725 billion to $1.8 billion[31] - Adjusted EBITDA for the three months ended March 29, 2025, was $385.1 million, representing a 20.1% increase from $320.7 million in the prior year[51] - Net income for the nine months ended March 29, 2025, was $208.7 million, a decrease of 22.5% compared to $269.4 million for the same period in 2024[42] - Adjusted EBITDA for the nine months ended March 29, 2025, increased to $1,220.0 million, reflecting a 16.2% growth compared to $1,049.9 million in the prior year[52] Sales and Volume Growth - Total case volume increased 10.0% in Q3 FY2025, with Independent Foodservice case volume rising 20.0%[6] - Foodservice segment net sales increased 19.2% to $8.4 billion in Q3 FY2025, driven by case volume growth and inflation[24] - Foodservice segment net sales for the nine months ended March 29, 2025, were $24,454.6 million, up 14.3% from $21,400.4 million in the prior year[57] - The Specialty segment reported net sales of $3,651.5 million for the nine months ended March 29, 2025, reflecting a 1.8% increase from $3,586.1 million in the prior year[57] Expenses and Cash Flow - Operating expenses for Q3 FY2025 rose 16.5% to $1.6 billion, mainly due to acquisitions and increased personnel costs[10] - Free cash flow for the first nine months of FY2025 was $494.4 million, down from $712.3 million in the prior year[21] - Cash flows from operating activities for the nine months ended March 29, 2025, totaled $827.1 million, down from $956.7 million in the same period of 2024[42] - Net cash used in investing activities was $2,875.1 million for the nine months ended March 29, 2025, significantly higher than $533.0 million in the prior year, primarily due to acquisitions[42] - The company incurred $260.3 million in interest payments net of amounts capitalized for the nine months ended March 29, 2025, compared to $173.4 million in the prior year[43] - Interest expense increased by 51.1% to $263.9 million for the nine months ended March 29, 2025, compared to $174.6 million in the prior year[52] Debt and Assets - Total assets as of March 29, 2025, were $17,123.4 million, an increase from $13,392.9 million as of June 29, 2024[41] - Long-term debt increased to $5,422.7 million as of March 29, 2025, compared to $3,198.5 million as of June 29, 2024[41] - The company reported net borrowings of $1,229.7 million under the ABL Facility for the nine months ended March 29, 2025, compared to net payments of $249.1 million in the previous year[42] Earnings Per Share - Diluted earnings per share (GAAP) for the three months ended March 29, 2025, was $0.37, a decrease of 17.8% from $0.45 in the same period of 2024[51] - Diluted earnings per share (GAAP) decreased to $1.34, down 22.1% from $1.72 in the same period last year[52] Acquisitions and Risks - PFG's acquisition of Cheney Brothers is expected to impact business results starting from the close of the transaction[32] - The company faces various risks including economic factors, reliance on third-party suppliers, and integration challenges related to acquisitions[37] - Acquisition, integration, and reorganization expenses surged to $76.2 million, a 299.0% increase from $19.1 million in the prior year[52] Tax and Other Metrics - The effective tax rate for Q3 FY2025 was approximately 25.8%, a decrease from 27.3% in the prior year[11] - The company plans to continue using Adjusted EBITDA as a key performance metric for evaluating business performance and management compensation[45]