Us Foods Holding Corp. · NYSE:USFD
Us Foods — ESG Presentation (October 2023)
36 slides from Us Foods's sustainability presentation, Oct 23, 2023
Slide 1: Environmental, Social & Governance Update Fall 2023
Environmental, Social & Governance Update Fall 2023
Slide 2: Cautionary Statements Regarding Forward-Looking Information
Cautionary Statements Regarding Forward - Looking Information Statements in this presentation which are not historical in nature, are “forward - looking statements” within the meaning of the f ederal securities laws. These statements often include words such as “believe,” “expect,” “project,” “antic
Slide 3: USFD Company Overview
USFD Company Overview am GREAT FOOD. MADE EASY.”
Slide 4: US Foods – At a Glance
US Foods Distribution Center States with CHEF’STORE Stores US Foods – At a Glance 3
Slide 5: Our Culture and Strategy
omewe Ly CULTURE EMBRACE THE US FOODS" CULTURE ‘SAFE: Always keep our people safe and embrace a path to zero accidents and injuries ‘SUPPORTIVE: Champion a diverse and inclusive work environment for all foster employee engagement; attract world-class talent RESPONSIBLE: Be environmentally and social
Slide 6: Continued Progress Across the Business in Q2 2023
Continued Progress Across the Business in Q2 2023 • Grew total case volume 3%, led by growth in independents, healthcare and hospitality • Grew Adjusted EBITDA 17% to a new quarterly record • Expanded Adjusted EBITDA margin 60 bps • Continued market share gains with independent restaurants for ninth
Slide 7: Environmental, Social and Governance (ESG) Update
Environmental, Social and Governance (ESG) Update
Slide 8: Key ESG Highlights
Key ESG Highlights Governance – Track record of governance best practices, led by high quality, experienced and diverse Board of Directors, including restoration of single class of common stock in 2023 Planet – Reduced absolute Scope 1 and Scope 2 greenhouse gas (GHG) emissions by 13% from our 2019
Slide 9: Board Knowledge, Skills, Experience, Demographics & Tenure
Food Industry Supply Chain & Logistics CEO Leadership Sustainability & Corporate Responsibility Accounting/Finance Risk Management Technology Marketing & Strategy Human Capital Management Other Public Company Boards Knowledge, Skills & Experience Highly - experienced Board with unique backgrounds, q
Slide 10: Governance Highlights
Governance Highlights Declassified Board – all directors elected annually x Majority vote standard in uncontested director elections x Independent Chair of the Board x No shareholder rights plan (poison pill) x Annual say - on - pay vote, with more than 80% support each year x Annual Board and commi
Slide 11: Shareholder Engagement By the Numbers
2021 Contacted 60% of our outstanding stock Met with 35% of our outstanding stock 2022 Contacted 80% of our outstanding stock Met with 63% of our outstanding stock Shareholder Engagement By the Numbers Commitment to Proactive Shareholder Engagement • US Foods recognizes the value of listening to our
Slide 12: Q2 Highlights and Experienced Public Company CEO Driving Shareholder Value
• Drove Net Sales of $9.1 Billion (+2.1% from Q2 2022) • Increased Gross Profit 15% to $1.6 Billion and Net Income to $182 Million • Delivered Record Adjusted EBITDA of $432 Million • Expanded Adjusted EBITDA Margin by 60 bps • Repurchased $166 Million of Shares and Prepaid $60 Million of Debt • Sig
Slide 13: Executive Pay Aligned with Shareholder Interests
Executive Pay Aligned with Shareholder Interests Compensation Program Balances Performance Orientation and Shareholder Alignment Elements of Executive Pay and Related Objectives • Attracts talent and supports retention • Forms basis for AIP target award Base Salary • Links executive pay to US Foods’
Slide 14: US Foods' 2022 CSR Report
US Foods’ 2022 CSR Report Published on May 25 x x x x x x x x Clearly articulated ESG priorities and goals Increased disclosures in key areas of interest Detailed Board and managerial oversight More robust data disclosures with clear visuals Stand - out “highlights” pages by pillar TCFD, GRI and qua
Slide 15: 2022 CSR Report Highlights
2022 CSR Report Highlights Continued Progress Across Key Environment, Social and Governance Issues Planet x Reduced absolute Scope 1 and Scope 2 GHG emissions 13% from a 2019 climate goal baseline year x Reported first - ever scope 3 GHG footprint x Enhanced select SASB disclosures with quantitative
Slide 16: Meaningful Progress Being Made Toward Climate Goals
Meaningful Progress Being Made Toward Climate Goals (1)(2) Assessing key emissions reductions (3) projects and financing including : • Alternative fuels and electric vehicles, trailers and charging stations • Solar and clean energy systems and battery energy storage • On - site refrigeration system
Slide 17: Growing Relationships with Diverse Suppliers
16 *Figures include trade and indirect spend with Tier 1 suppliers 0 100 200 300 400 500 600 700 800 2018 2019 2020 2021 2022 Program Development Suppliers Spend ($M) Our supplier diversity program enhances our network of vendor partnerships with small businesses and companies that are owned and ope
Slide 18: Providing local, sustainable and well-being products
Providing local, sustainable and well - being products Product sustainability is integrated via our Hungry For Better program which provides strategic guardrails for the development of products that are local, sustainable and/or support well - being with an emphasis on products that are innovative a
Slide 19: Innovative Products Helping Reduce Greenhouse Gas Emissions
Innovative products, currently being produced by the Company, are helping to reduce greenhouse gas emissions Serve Good’s Newest Pillar – Climate - Conscious Climate - Friendly Re sult in lower GHG emissions than 70% of all products assessed by HowGood Carbon - Negative Remove more GHG from the at
Slide 20: Embracing Diversity and Inclusion
Embracing Diversity and Inclusion Our commitment to diversity and inclusion is grounded in three strategic areas of focus Creating a more inclusive work environment where everyone feels safe, valued and that their voices matter Increasing the diversity of our workforce and leaders by investing in pr
Slide 21: Enhanced Demographic Disclosure
Enhanced Demographic Disclosure* In response to shareholder feedback, we have provided increased transparency on demographic metrics, including race and ethnicity, for multiple employment levels 20 *Graphs show Company’s proxy disclosures for workforce diversity, as of January 1, 2023
Slide 22: Renewed Commitment to Associate Safety
Renewed Commitment to Associate Safety Top - down approach to instilling a strong safety culture is gaining traction and showing results 21 ~20 % improvement in our Q2 2023 safety results as compared to the prior year, through a combination of tone from the top and focused programs to drive results
Slide 23: Corporate Social Responsibility Recognition
Corporate Social Responsibility 2023 Noteworthy Company for Diversity DiversityInc 2023 America’s Most Innovative Companies Fortune Magazine 2023 Top - Rated ESG Company Sustainalytics 2023 America’s Best Large Employers Newsweek 2023 W orld's Most Trustworthy Companies Newsweek 2023 America's Great
Slide 24: Appendix: Q2 Fiscal 2023 Summary Non-GAAP Reconciliations
Appendix: Q2 Fiscal 2023 Summary Non - GAAP Reconciliations
Slide 25: Quarterly Case Volume Trend vs. Prior Year
Quarterly Case Volume Trend vs. Prior Year Independent Restaurant Case Growth (1)(2) YOY percent change for total and organic cases 0.2% 74.4% 25.1% 20.6% 9.2% 0.3% 2.9% 5.8 % 7.8 % 4.8 % 8.1% 79.1% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Organic Case Growth by Quarter (1)(2) YOY percent change -30% -20% -10%
Slide 26: US Foods Debt Summary
• Net leverage expected to be below 3.0x by year - end • Repaid $71M and $66M on 2019 and 2021 Incremental Term Loan Facilities in Q1 and Q2 2023 respectively • SOFR was 5.10% as of July 1, 2023 • 2 - year 5% interest rate caps on $450M of notional value against term loans (3) • A 100 bps increase i
Slide 27: Second Quarter Financial Performance
Second Quarter Financial Performance Note : Figures may not foot due to rounding 1. R econciliations of these non - GAAP measures are provided in this Appendix . 2. GAAP Diluted EPS calculated using net income available to common shareholders . Adjusted Diluted EPS is calculated as Adjusted net inco
Slide 28: Year to Date Financial Performance
Year to Date Financial Performance Note : Figures may not foot due to rounding 1. Reconciliations of these non - GAAP measures are provided in this Appendix . 2. GAAP Diluted EPS calculated using net income available to common shareholders . Adjusted Diluted EPS is calculated as Adjusted net income
Slide 29: Non-GAAP Reconciliation - Adjusted Gross Profit and Adjusted Operating Expenses
Non - GAAP Reconciliation - Adjusted Gross Profit and Adjusted Operating Expenses (1) - (5) footnotes located on next slide 26 Weeks Ended 13 Weeks Ended (unaudited) (unaudited) July 2, 2022 July 1, 2023 July 2, 2022 July 1, 2023 ($ in millions) $2,578 $3,016 $1,383 $1,591 Gross profit (GAAP) 137 5
Slide 30: Non-GAAP Reconciliation - Adjusted Gross Profit and Adjusted Operating Expenses (footnotes)
Non - GAAP Reconciliation - Adjusted Gross Profit and Adjusted Operating Expenses 1. Represents the non - cash impact of LIFO reserve adjustments . 2. Share - based compensation expense for expected vesting of stock awards and employee stock purchase plan . 3. Transformational costs represent non -
Slide 31: Non-GAAP Reconciliation - Adjusted EBITDA and Adjusted Net Income
Non - GAAP Reconciliation - Adjusted EBITDA and Adjusted Net Income (1) - (6) footnotes located on next slide 26 Weeks Ended 13 Weeks Ended (unaudited) (unaudited) July 2, 2022 July 1, 2023 July 2, 2022 July 1, 2023 ($ in millions) $45 $257 $61 $182 Net income available to common shareholders (GAAP)
Slide 32: Non-GAAP Reconciliation - Adjusted EBITDA and Adjusted Net Income (footnotes)
Non - GAAP Reconciliation - Adjusted EBITDA and Adjusted Net Income 1. Share - based compensation expense for expected vesting of stock awards and employee stock purchase plan . 2. Represents the non - cash impact of LIFO reserve adjustments . 3. Transformational costs represent non - recurring expe
Slide 33: Non-GAAP Reconciliation - Adjusted Diluted EPS
Non - GAAP Reconciliation - Adjusted Diluted Earnings Per Share (EPS) ( 1) - (8) footnotes located on next slide 26 Weeks Ended 13 Weeks Ended (unaudited) (unaudited) July 2, 2022 July 1, 2023 July 2, 2022 July 1, 2023 $0.20 $1.05 $0.27 $0.73 Diluted EPS (GAAP) 0.08 0.11 0.04 0.06 Share - based comp
Slide 34: Non-GAAP Reconciliation - Adjusted Diluted EPS (footnotes)
Non - GAAP Reconciliation - Adjusted Diluted Earnings Per Share (EPS) 1. Share - based compensation expense for expected vesting of stock awards and employee stock purchase plan . 2. Represents the non - cash impact of LIFO reserve adjustments . 3. Transformational costs represent non - recurring ex
Slide 35: Non-GAAP Reconciliation - Net Debt and Net Leverage Ratios
Non - GAAP Reconciliation - Net Debt and Net Leverage Ratios (1) Trailing Twelve Months (TTM) Adjusted EBITDA (2) Net debt / TTM Adjusted EBITDA (unaudited) July 2, 2022 December 31, 2022 July 1, 2023 ($ in millions, except ratios) $5,020 $4,854 $4,751 Total Debt (GAAP) (197) (211) (379) Cash, cash
Slide 36: We Help You Make It
WE HELP YOU US. MAKE IT*