Financial Data and Key Metrics Changes - For the first nine months of fiscal 2025, the company achieved a 4.4% net sales growth, 10.9% adjusted EBITDA growth, 29 basis points of adjusted EBITDA margin expansion, and 26.7% adjusted EPS growth [8][35][41] - In Q3, net sales increased by 4.8% to $10.2 billion, driven by case volume growth of 1.1% and food cost inflation and mix impact of 3.7% [34][41] - Adjusted EBITDA for Q3 was $500 million, reflecting an 11% increase, with adjusted EBITDA margin expanding by 28 basis points [35][41] Business Line Data and Key Metrics Changes - Independent case growth accelerated by 120 basis points from Q2 to Q3, achieving a 3.9% growth year-over-year [10][34] - Chain restaurant volume declined by 2.4%, although this represented a 160 basis points sequential improvement over Q2 [12][34] - Healthcare and hospitality segments grew by 3.9% and 2.4%, respectively, with healthcare maintaining strong performance [11][34] Market Data and Key Metrics Changes - The company gained market share with independent restaurants for the eighteenth consecutive quarter, while healthcare saw its twentieth consecutive quarter of market share gains [12][34] - The overall volume growth was supported by new business wins in healthcare and hospitality, with a strong pipeline for future growth [22][120] Company Strategy and Development Direction - The company is focused on a long-range plan that emphasizes sustainable growth, disciplined capital allocation, and strategic acquisitions, including the recent agreement to acquire Chitakis [9][10][39] - The four strategic pillars guiding the company are culture, service, growth, and profit, with ongoing initiatives to enhance operational efficiency and customer service [13][18][28] - The company plans to invest significantly in its Pronto small truck delivery service, expecting it to generate approximately $950 million in sales this year [19][20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving long-term growth targets despite a sluggish macro environment, emphasizing the company's ability to control its own destiny through strategic initiatives [52][72] - The company expects to continue growing adjusted EPS at a faster rate than adjusted EBITDA, projecting adjusted diluted EPS growth of 24% to 26% for the fiscal year [41][42] - Management acknowledged challenges in the restaurant industry but highlighted strong execution and market share gains as key strengths [90][92] Other Important Information - The company has implemented a new sales compensation structure, transitioning to a 100% variable compensation model for local sellers, aimed at incentivizing growth [24][76] - The company reported a strong operating cash flow of nearly $1.1 billion year-to-date, allowing for continued capital investments and share repurchases [39][40] Q&A Session Summary Question: Overall total case growth remains sluggish; what incremental pressures are being seen? - Management noted strong momentum in independent restaurants, with the strongest growth rate in September, and attributed sluggishness to external factors like government shutdowns affecting consumer confidence [50][52] Question: Can you provide more details on the sales force compensation change? - Management expressed confidence in the transition to a 100% variable compensation model, emphasizing that it is designed to incentivize growth and that the change management process is robust [53][54] Question: How many sales support roles are transitioning to customer-facing positions? - The majority of those in sales support roles have been offered seller roles, with a focus on retaining expertise within the company [62][63] Question: What is the impact of the new sales compensation structure on growth rates? - Management expects to maintain low to mid-single-digit growth rates in sales headcount while implementing the new compensation structure [71][72] Question: How is the company addressing strategic vendor management and reinvestment? - Management indicated that productivity gains from strategic vendor management will be reinvested to drive growth and enhance competitiveness [79][81]