Us Foods Holding Corp. · NYSE:USFD
Us Foods — Q1 2018 Earnings Presentation
21 slides from Us Foods's earnings presentation, May 8, 2018
Slide 1: Q1 Fiscal 2018 Results
Q1 Fiscal 2018 Results May 8, 2018
Slide 2: Cautionary Statements
Cautionary Statements Forward-Looking Statements This presentation contains “forward-looking statements” concerning, among other things, our liquidity, our possible or assumed future results of operations and our business strategies. Our actual results could differ materially from those expressed in
Slide 3: Key investor day takeaways lead to 8-10% Adjusted EBITDA growth for fiscal years 2018 - 2020
Key investor day takeaways lead to 8-10% Adjusted EBITDA growth for fiscal years 2018 - 2020 1 2 3 Differentiated strategy Enhanced focus on Attractive industry with deployed against most significant cost reduction favorable outlook favorable customer types opportunities Large, fragmented and growin
Slide 4: Solid quarter in light of industry wide headwinds
Solid quarter in light of industry wide headwinds • Adjusted EBITDA growth of 4.2% impacted by freight, weather and calendar • ~300 bps negative impact from inbound freight costs • ~250 bps negative impact from weather and calendar timing • Good independent restaurant growth normalizing for weather
Slide 5: Chain exits, along with weather and calendar headwinds, impacted volume growth in Q1
Chain exits, along with weather and calendar headwinds, impacted volume growth in Q1 Organic Acquisitions Independent Restaurant Case Growth CASE GROWTH BY QUARTER* YoY percent change* ~(100) bps impact YoY Change* from weather, 7.1% ~(50) bps IND Case Growth from promos 6.0% 10% HC/Hosp Case Growth
Slide 6: Our Great Food. Made Easy. strategy continues to resonate
Our Great Food. Made Easy. strategy continues to resonate Scoop E-Commerce Value Added Services 6000 # OF IND CUSTOMER PLACEMENTS 50% 60% SCOOP CUSTOMER TRIAL RATE 5000 IND E-COMM PENETRATION 50% 40% 4000 40% 30% 3000 30% 2000 20% 20% 1000 10% 10% 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 0% 0% Spring 2016 Sprin
Slide 7: Year-over-year inflation driving increase in Net Sales
Year-over-year inflation driving increase in Net Sales Q1 Net Sales RESULTS SUMMARY $ Millions b/(w) Net Sales drivers: • Volume growth with independent restaurants $5,823 $5,788 • Positive acquisition volume and mix 0.6% • Total organic volume declined, primarily on exits and weather impact • YOY i
Slide 8: Gross profit dollar growth outpaced volume
Gross profit dollar growth outpaced volume Q1 Gross Profit RESULTS SUMMARY $ Millions; Percent of Sales b/(w) $991 $992 Gross Profit drivers: 0.1% • Positive customer mix impacts • Margin initiatives driving gains • Private brand growth of ~100 bps 17.1% 17.0% (9) bps • Strategic vendor management •
Slide 9: Operating expense improvement on lower amortization
Operating expense improvement on lower amortization Q1 Operating Expense RESULTS SUMMARY $ Millions; Percent of Sales b/(w) $915 Operating Expense drivers: $889 • Positive impact from amortization drop off 2.8% • Unfavorable volume deleveraging on fixed costs • Supply chain 15.8% 15.3% 54 bps • Inve
Slide 10: Growth in Gross Profit per case continues to outpace change in Operating Expense per case
Growth in Gross Profit per case continues to outpace change in Operating Expense per case ADJ GROSS PROFIT AND ADJ OPERATING EXPENSE $/case higher/lower than prior year Adj GP Adj OPEX $0.08 per case $0.20 $0.06 per case impact from fixed $0.15 cost deleverage $0.19 $0.08 per case better $0.10 $0.00
Slide 11: Key profitability metrics improving over prior year
Key profitability metrics improving over prior year Q1 Adjusted EBITDA* Q1 Adjusted Diluted Earnings Q1 Net Income $ Millions; Percent of Sales Per Share* $ Millions 2017 $ 2018 $0.35 $75 $224 $67 $215 4.2% $40 $0.18 94% $27 3.7% 3.8% 2017 2018 2017 2018 GAAP Adjusted* * Reconciliations of non-GAAP
Slide 12: Operating cash flow growth is driving lower Net Debt and leverage results
Operating cash flow growth is driving lower Net Debt and leverage results Q1 Operating Cash Flow Q1 Net Debt* and Leverage Leverage ** $ Millions $ Millions $192 $3,703 $3,638 $3,544 3.8x $122 3.4x 3.3x 2017 2018 Q1 2017 Q4 2017 Q1 2018 * Reconciliations of non-GAAP measures are provided in the Appe
Slide 13: Updated 2018 guidance
Updated 2018 guidance 2018 Guidance Case Growth ~1% Net Sales Growth ~3% Adjusted EBITDA Growth 6 – 8% Cash CAPEX $250 - $260M (ex Future Acquisitions) Interest Expense $175 - $180M Depreciation & Amortization $340 - $350M Adj Effective Tax Rate 25% - 26% Adjusted Diluted EPS $2.00 - $2.10 Orange te
Slide 14: Appendix
APPENDIX: • Q1 FISCAL 2018 SUMMARY • NON-GAAP RECONCILIATIONS 13
Slide 15: First Quarter Financial Performance
First Quarter Financial Performance (1) Reported Adjusted (unaudited) (unaudited) 13-Weeks Ended 13-Weeks Ended 13-Weeks Ended 13-Weeks Ended March 31, April 1, March 31, April 1, $ in millions, except per share data* 2018 2017 Change 2018 2017 Change Case Growth (2.3)% Net Sales 5,823 5,788 0.6 % G
Slide 16: Non-GAAP Reconciliation - Adjusted Gross Profit and Adjusted Operating Expenses
Non-GAAP Reconciliation - Adjusted Gross Profit and Adjusted Operating Expenses 13-Weeks Ended (unaudited) March 31, 2018 April 1, 2017 ($ in millions)* Gross Profit (GAAP) $992 $991 LIFO reserve change (1) 19 10 Adjusted Gross Profit (Non-GAAP) $1,011 $1,001 Operating Expenses (GAAP) $889 $915 Adju
Slide 17: Non-GAAP Reconciliation - Adjusted Operating Income
Non-GAAP Reconciliation - Adjusted Operating Income 13-Weeks Ended (unaudited) March 31, 2018 April 1, 2017 ($ in millions)* Operating Income (GAAP) $102 $76 Adjustments: Depreciation and amortization expense 81 108 Restructuring charges (1) 2 2 Share-based compensation expense (2) 7 3 LIFO reserve
Slide 18: Non-GAAP Reconciliation - Adjusted EBITDA and Adjusted Net Income
Non-GAAP Reconciliation - Adjusted EBITDA and Adjusted Net Income 13-Weeks Ended (unaudited) March 31, 2018 April 1, 2017 ($ in millions)* Net income (GAAP) $67 $27 Interest expense, net 43 42 Income tax (benefit) provision (5) 8 Depreciation and amortization expense 81 108 EBITDA (Non-GAAP) 187 184
Slide 19: Non-GAAP Reconciliation - Adjusted Diluted Earnings Per Share (EPS)
Non-GAAP Reconciliation - Adjusted Diluted Earnings Per Share (EPS) 13-Weeks Ended (unaudited) March 31, 2018 April 1, 2017 Diluted EPS (GAAP) $ 0.31 $ 0.12 Restructuring charges (1) 0.01 0.01 Share-based compensation expense (2) 0.03 0.01 LIFO reserve change (3) 0.09 0.04 Business transformation co
Slide 20: Non-GAAP Reconciliation – Net Debt and Net Leverage Ratios
Non-GAAP Reconciliation – Net Debt and Net Leverage Ratios (unaudited) March 31, December 30, April 1, ($ in millions)* 2018 2017 2017 Total debt (GAAP) $3,630 $3,757 $3,855 Cash, cash equivalents and restricted cash (86) (119) (152) Restricted cash - - - Net Debt (Non-GAAP) $3,544 $3,638 $3,703 Adj
Slide 21: WE HELP YOU
WE HELP YOU US. MAKE IT"