Post Earnings Coverage as Performance Food Group's Quarterly Sales Jumped 8.3%; Adjusted EPS Soared 80%
Upcoming AWS Coverage on Cracker Barrel Old Country Store Post-Earnings Results
LONDON, UK / ACCESSWIRE / June 1, 2017 / Active Wall St. announces its post-earnings coverage on Performance Food Group Co. (NYSE: PFGC). The Company reported its third quarter fiscal 2017 financial results on May 10, 2017. The food distributor surpassed earnings expectations and confirmed its outlook. Register with us now for your free membership at:
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One of Performance Food Group's competitors within the Restaurants space, Cracker Barrel Old Country Store, Inc. (NASDAQ: CBRL), reported on May 23, 2017, its financial results for Q3 FY17 which ended on April 28, 2017. AWS will be initiating a research report on Cracker Barrel Old Country Store in the coming days.
Today, AWS is promoting its earnings coverage on PFGC; touching on CBRL. Get our free coverage by signing up to:
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Earnings Reviewed
For the three months ended April 01, 2017, Performance Food's total case volume increased 7.7% on a y-o-y basis, with underlying organic total case volume growth of 5.9%. The Company's total case volume was driven by a 7.0% increase in independent cases, strong growth in Performance Brands and broad-based growth in Vistar's sales channels.
For Q3 FY17, Performance Food's net sales totaled $4.24 billion, an increase of 8.3% versus the prior year's comparable period sales of $3.91 billion, outpacing total case growth due to a favorable shift in product and customer mix.
During Q3 FY17, Performance Food's operating expenses increased 7.1% on a y-o-y basis to $474.7 million. The increase reflected the cost to support current growth in case volume as well as the cost of strategic investments associated with expansion of geographies served in the dollar store channel and the opening of an automated retail facility within Vistar. The Company's operating profit for the reported quarter was up 24.2% driven by the 8.4% increase in gross profit and leveraging of operating expenses.
For Q3 FY17, Performance Food's net income increased soared 121.3% to $20.8 million compared to net income of $9.4 million for the prior year's corresponding period. The Company's diluted EPS increased 122.2% in the reported quarter to $0.20 compared to $0.09 in the prior year's same period. Adjusted diluted EPS increased 80.0% in Q3 FY17 to $0.27 per share driven by higher adjusted EBITDA and lower interest expense and ahead of Wall Street's estimates of $0.25 per share.
Segment Results
During Q3 FY17, the Company's Performance Foodservice (PFS) net sales increased 4.8% on a y-o-y basis to $2.4 billion, driven by new customers, an increase in cases sold, including 7.0% independent case growth, and strong case growth for our Performance Brands. This marks the segment's 31st consecutive quarter of independent case growth at or above 6.0%.
For Q3 FY17, EBITDA for PFS increased 8.1% to $68.1 million. The segment's gross profit grew by 6.0%, while leveraging its EBITDA growth to 8.1% through strong operating expense control. The increase in gross profit per case resulted from a favorable shift in the mix of cases sold toward independent customers and Performance Brands.
Performance Food's PFG Customized segment reported net sales of $1.0 billion, up 8.2% on a y-o-y basis due to improved sales mix, higher case volume and higher revenue per case and was partially offset by softness in the casual dining environment. In the reported quarter, the segment began providing distribution solutions to a portion of Red Lobster's restaurants. EBITDA growth for the segment during the reported quarter was 6.2%, as a result of the successful integration of Red Lobster.
Performance Food's Vistar's Q3 FY17 net sales increased 15.2% to $750.5 million compared to the prior year's same period. This increase was driven by case sales growth in the segment's retail, theater, vending, and hospitality channels and by recent acquisitions. During the reported quarter, EBITDA for Vistar increased 9.7% to $29.3 million. Gross profits grew 13.6% for Q3 FY17, fueled by an increase in the number of cases sold and by acquisitions.
Cash Flow and Capital Spending
During the first nine months of fiscal 2017, Performance Food's operating activities provided $102.0 million of cash flow compared to $118.4 million during the year ago comparable period. Cash used in investing activities totaled $250.8 million for the first nine months of fiscal 2017. These investments consisted of business acquisitions totaling $144.9 million and capital expenditures of $106.6 million. The Company continues to expect capital expenditures for fiscal 2017 to be between $140 million and $160 million.
Fiscal 2017 Outlook
Performance Food reiterated its FY17 adjusted EBITDA growth outlook to be in the 7% to 9% range on a 52 week to 52 week basis. The Company is projecting FY17 adjusted diluted EPS growth outlook to be in a range of 27% to 31% to $1.23 to $1.27 on a 52 week to 52 week basis . PFG also confirms fiscal 2017 adjusted diluted EPS growth outlook to be in a range of 24% to 28% to $1.24 to $1.28 on a 52 week to 53 week basis versus a comparable 53 week fiscal 2016 adjusted diluted EPS of $1.00.
Stock Performance
Performance Food Group's share price finished yesterday's trading session at $28.30, slightly down by 0.35%. A total volume of 790.17 thousand shares exchanged hands, which was higher than the 3 months average volume of 772.25 thousand shares. The stock has surged 19.66% in the last three months, 27.77% in the past six months, and 13.98% in the previous twelve months. Furthermore, since the start of the year, shares of the Company have rallied 17.92%. The stock is trading at a PE ratio of 34.10 and currently has a market cap of $2.95 billion.
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