Press Releases
The Chefs' Warehouse Reports First Quarter 2014 Financial Results
Net Sales Increased 34.3% in the First Quarter of 2014
The Company Updates Guidance Based on Chicago Market Build-Out
Financial highlights for the first quarter of 2014 compared to the first quarter of 2013:
-
Net sales increased 34.3% to
$187.2 million for the first quarter of 2014 from$139.4 million for the first quarter of 2013. -
Net income available to common stockholders was
$1.4 million for the first quarter of 2014 compared to$2.6 million for the first quarter of 2013. -
Earnings per diluted share available to common stockholders was
$0.06 for the first quarter of 2014 compared to$0.13 for the first quarter of 2013. -
Modified pro forma earnings per diluted share available to common stockholders1 was
$0.08 per diluted share for the first quarter of 2014 compared to$0.14 per diluted share for the first quarter of 2013. -
Adjusted EBITDA1 decreased 3.2% to
$8.0 million for the first quarter of 2014 from$8.3 million for the first quarter of 2013.
1 Please see the Consolidated Statements of Operations at the end of this earnings release for a reconciliation of EBITDA, Adjusted EBITDA, modified pro forma net income available to common stockholders and modified pro forma EPS to these measures' most directly comparable GAAP measure.
"As we expected, the first quarter continued to be negatively impacted by the severe weather that affected many of our core markets; however, we are optimistic that near term weather challenges are behind us as April weather has moderated," said
First Quarter Fiscal 2014 Results
Net sales for the quarter ended
Gross profit increased approximately 33.5% to
Total operating expenses increased by approximately 44.9% to
Operating income for the first quarter of 2014 was
Interest expense was
Net income available to common stockholders was
On a non-GAAP basis, adjusted EBITDA decreased approximately 3.2% to
2014 Guidance
The Company is announcing today that it has identified a market president and a distribution facility to launch its entry in the
-
Revenue between
$810.0 million and$840.0 million . -
Adjusted EBITDA between
$47.0 million and$52.5 million . -
Net income between
$14.3 million and$16.8 million . -
Net income per diluted share between
$0.57 and$0.67 . -
Modified pro forma net income per diluted share between
$0.63 and$0.73 .
The above guidance is based upon an estimated effective tax rate of approximately 41.0% and an estimated fully diluted share count of 25.0 million shares.
Conference Call
The Company will host a conference call to discuss first quarter 2014 financial results today at
Forward-Looking Statements
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release regarding the Company's business that are not historical facts are "forward-looking statements" that involve risks and uncertainties and are based on current expectations and management estimates; actual results may differ materially. The risks and uncertainties which could impact these statements include, but are not limited to, the Company's sensitivity to general economic conditions, including the current economic environment, changes in disposable income levels and consumer discretionary spending on food-away-from-home purchases; the Company's vulnerability to economic and other developments in the geographic markets in which it operates; the risks of supply chain interruptions due to lack of long-term contracts, severe weather or more prolonged climate change, work
stoppages or otherwise; the risk of loss of customers due to the fact that the Company does not customarily have long-term contracts with its customers; changes in the availability or cost of the Company's specialty food products; the ability to effectively price the Company's specialty food products and reduce the Company's expenses; the relatively low margins of the foodservice distribution industry and the Company's sensitivity to inflationary and deflationary pressures; the Company's ability to successfully identify, obtain financing for and complete acquisitions of other foodservice distributors and to integrate and realize expected synergies from those acquisitions; the Company's ability to deploy the remaining net proceeds from its
About
|
|
||
| CONSOLIDATED STATEMENTS OF OPERATIONS | ||
|
THIRTEEN WEEKS ENDED |
||
| (unaudited; in thousands except share amounts and per share data) | ||
| Thirteen Weeks Ended | ||
|
|
|
|
| Net Sales | $ 187,183 | $ 139,419 |
| Cost of Sales | 140,256 | 104,265 |
| Gross Profit | 46,927 | 35,154 |
| Operating Expenses | 42,390 | 29,257 |
| Operating Income | 4,537 | 5,897 |
| Interest Expense | 2,059 | 1,367 |
| Income Before Income Taxes | 2,478 | 4,530 |
| Provision for Income Tax Expense | 1,029 | 1,883 |
| Net Income Available to Common Stockholders | $ 1,449 | $ 2,647 |
| Net Income Per Share Available to Common Stockholders: | ||
| Basic | $ 0.06 | $ 0.13 |
| Diluted | $ 0.06 | $ 0.13 |
| Weighted Average Common Shares Outstanding: | ||
| Basic | 24,618,054 | 20,747,734 |
| Diluted | 24,839,563 | 20,993,918 |
|
|
||
| CONDENSED CONSOLIDATED BALANCE SHEET | ||
|
AS OF |
||
| (in thousands) | ||
|
|
|
|
| (unaudited) | ||
| Cash and cash equivalents | $ 26,055 | $ 20,014 |
| Accounts receivable, net | 74,208 | 76,413 |
| Inventories, net | 64,399 | 64,710 |
| Deferred taxes, net | 3,282 | 2,708 |
| Prepaid expenses and other current assets | 5,349 | 16,250 |
| Total current assets | 173,293 | 180,095 |
| Restricted cash | 2,071 | 5,578 |
| Equipment and leasehold improvements, net | 33,876 | 27,589 |
| Software costs, net | 2,115 | 2,265 |
| Goodwill | 78,814 | 78,026 |
| Intangible assets, net | 55,886 | 57,450 |
| Other assets | 3,754 | 3,755 |
| Total assets | 349,809 | 354,758 |
| Accounts payable | 30,088 | 33,925 |
| Accrued liabilities | 17,697 | 15,803 |
| Accrued compensation | 5,070 | 5,996 |
| Current portion of long-term debt | 7,091 | 6,867 |
| Total current liabilities | 59,946 | 62,591 |
| Long-term debt, net of current portion | 139,990 | 140,847 |
| Deferred taxes, net | 8,261 | 8,338 |
| Other liabilities | 8,284 | 10,917 |
| Total liabilities | 216,481 | 222,693 |
| Preferred stock | -- | -- |
| Common stock | 250 | 250 |
| Additional paid in capital | 97,095 | 96,973 |
| Cumulative translation adjustment | (521) | (215) |
| Retained earnings | 36,504 | 35,057 |
| Stockholders' equity | 133,328 | 132,065 |
| Total liabilities and stockholders' equity | $ 349,809 | $ 354,758 |
|
|
||
| CONDENSED CASH FLOW STATEMENT | ||
|
FOR THE THIRTEEN WEEKS ENDED MARCH 28, 2014 AND |
||
| (unaudited; in thousands) | ||
|
|
|
|
| Cash flows from operating activities: | ||
| Net Income | $ 1,449 | $ 2,647 |
| Adjustments to reconcile net income to net cash provided by operating activities: | ||
| Depreciation | 797 | 668 |
| Amortization | 1,468 | 1,076 |
| Provision for allowance for doubtful accounts | 130 | 192 |
| Deferred credits | 37 | 119 |
| Deferred taxes | (929) | 1,515 |
| Amortization of deferred financing fees | 216 | 143 |
| Stock compensation | 355 | 289 |
| Change in fair value of earnouts | 195 | -- |
| Changes in assets and liabilities, net of acquisitions: | ||
| Accounts receivable | 2,246 | 5,439 |
| Inventories | 52 | 2,740 |
| Prepaid expenses and other current assets | 10,894 | 677 |
| Accounts payable and accrued liabilities | (3,645) | (2,018) |
| Other liabilities | (2,720) | 30 |
| Other assets | (155) | (59) |
| Net cash provided by operating activities | 10,390 | 13,458 |
| Cash flows from investing activities: | ||
| Capital expenditures | (5,817) | (1,380) |
| Cash paid for acquisitions | -- | (21,885) |
| Net cash used in investing activities | (5,817) | (23,265) |
| Cash flows from financing activities: | ||
| Change in restricted cash | 3,507 | 2,575 |
| Payment of debt | (1,758) | (2,043) |
| Payment of deferred financing fees | (17) | (45) |
| Borrowings under revolving credit line | -- | 24,400 |
| Payments under revolving credit line | -- | (13,900) |
| Surrender of shares to pay withholding taxes | (233) | (63) |
| Net cash provided by financing activities | 1,499 | 10,924 |
| Effect of foreign currency translation on cash and cash equivalents | (31) | -- |
| Net increase in cash and cash equivalents | 6,041 | 1,117 |
| Cash and cash equivalents at beginning of period | 20,014 | 118 |
| Cash and cash equivalents at end of period | $ 26,055 | $ 1,235 |
|
|
||
| RECONCILIATION OF EBITDA AND ADJUSTED EBITDA TO NET INCOME | ||
|
THIRTEEN WEEKS ENDED |
||
| (unaudited; in thousands) | ||
| Thirteen Weeks Ended | ||
|
|
|
|
| Net Income: | $ 1,449 | $ 2,647 |
| Interest expense | 2,059 | 1,367 |
| Depreciation | 797 | 668 |
| Amortization | 1,468 | 1,076 |
| Provision for income tax expense | 1,029 | 1,883 |
| EBITDA (1) | 6,802 | 7,641 |
| Adjustments: | ||
| Stock compensation (2) | 355 | 289 |
| Duplicate rent (3) | 462 | 347 |
| Investigation costs (4) | 395 | -- |
| Adjusted EBITDA (1) | $ 8,014 | $ 8,277 |
1. We are presenting EBITDA and Adjusted EBITDA, which are not measurements determined in accordance with the U.S. generally accepted accounting principles, or GAAP, because we believe these measures provide additional metrics to evaluate our operations and which we believe, when considered with both our GAAP results and the reconciliation to net income, provide a more complete understanding of our business than could be obtained absent this disclosure. We use EBITDA and Adjusted EBITDA, together with financial measures prepared in accordance with GAAP, such as revenue and cash flows from operations, to assess our historical and prospective operating performance and to enhance our understanding of our core operating performance. The use of EBITDA and Adjusted EBITDA as peformance measures permits a comparative assessment of our operating performance relative to our performance based upon GAAP results while isolating the effects of some items that vary from period to period without any correlation to core operating performance or that vary widely among similar companies.
2. Represents non-cash stock compensation expense associated with awards of restricted shares of our common stock to our key employees and our independent directors.
3. Represents rent expense and other facility costs, including utilities and insurance, incurred on the renovation and expansion of our
4. Represents the costs incurred in our previously disclosed investigation of the accounting issue at
|
|
||
| RECONCILIATION OF MODIFIED PRO FORMA NET INCOME TO NET INCOME | ||
|
THIRTEEN WEEKS ENDED |
||
| (unaudited; in thousands except share amounts and per share data) | ||
| Adjustments to Reconcile Modified Pro Forma Net Income to Net Income (1) | ||
| Thirteen Weeks Ended | ||
|
|
|
|
| Net Income Available to Common Stockholders | $ 1,449 | $ 2,647 |
| Duplicate rent (2) | 462 | 347 |
| Investigation costs (3) | 395 | -- |
| Tax effect adjustments (4) | (356) | (144) |
| Total Adjustments | 501 | 203 |
| Modified Pro Forma Net Income Available to Common Stockholders | $ 1,950 | $ 2,850 |
| Diluted Earnings per Share - Modified Pro Forma | $ 0.08 | $ 0.14 |
| Diluted Shares Outstanding - Modified Pro Forma (5) | 24,839,563 | 20,993,918 |
1. We are presenting modified pro forma net income available to common stockholders and modified pro forma EPS, which are not measurements determined in accordance with U.S. generally accepted accounting principles, or GAAP, because we believe these measures provide additional metrics to evaluate our operations and which we believe, when considered with both our GAAP results and the reconciliation to net income available to common stockholders, provide a more complete understanding of our business than could be obtained absent this disclosure. We use modified pro forma net income available to common stockholders and modified pro forma EPS, together with financial measures prepared in accordance with GAAP, such as revenue and cash flows from operations, to assess our historical and prospective operating performance and to enhance our understanding of our core operating performance. The use of modified pro forma net income available to common stockholders and modified pro forma EPS as performance measures permits a comparative assessment of our operating performance relative to our performance based upon our GAAP results while isolating the effects of some items that vary from period to period without any correlation to core operating peformance or that vary widely among similar companies.
2. Represents rent expense and other facility costs, including utilities and insurance, incurred on the renovation and expansion of our
3. Represents the costs incurred in our previously disclosed investigation of the accounting issue at
4. Represents the tax effect of items 2 and 3 above.
5. Represents diluted shares outstanding of our common stock.
|
|
||
| 2014 FULLY DILUTED EPS GUIDANCE RECONCILIATION TO | ||
| 2014 MODIFIED PRO FORMA FULLY DILUTED EPS GUIDANCE(1) | ||
| (unaudited) | ||
| Low-End | High-End | |
| Guidance | Guidance | |
| Net income per diluted share | $ 0.57 | $ 0.67 |
| Duplicate rent (2) | 0.03 | 0.03 |
| Investigation costs (3) | 0.02 | 0.02 |
| Integration costs (4) | 0.01 | 0.01 |
| Modified pro forma net income per diluted share (5) | $ 0.63 | $ 0.73 |
1. Guidance is based upon an estimated effective tax rate of 41.0% and an estimated fully diluted share count of 25.0 million shares.
2. Represents rent and occupancy expense expected to be incurred in connection with the renovation and expansion of our
3. Represents the costs expected to be incurred in our investigation of the accounting issue at
4. Represents costs expected to be incurred to integrate and standardize
5. We are presenting estimated modified pro forma EPS, which is not a measurement determined in accordance with U.S. generally accepted accounting principles, or GAAP, because we believe this measure provides an additional metric to evaluate our currently projected results and which we believe, when considered with both our estimated GAAP results and the reconciliation to estimated net income per diluted share, provides a more complete understanding of our expectations for our business than could be obtained absent this disclosure. We use modified pro forma EPS, together with financial measures prepared in accordance with GAAP, such as revenue and cash flows from operations, to assess our historical and prospective operating performance and to enhance our understanding of our core operating performance. The use of modified pro forma EPS as a performance measure permits a comparative
assessment of our expectations regarding our estimated operating performance relative to our estimated operating performance based on our GAAP results while isolating the effects of some items that vary from period to period without any correlation to core operating performance or that vary widely among similar companies.
|
|
||
| RECONCILIATION OF ADJUSTED EBITDA GUIDANCE FOR FISCAL 2014 | ||
| (unaudited; in thousands) | ||
|
Low-End Guidance |
High-End Guidance |
|
| Net Income: | $ 14,300 | $ 16,800 |
| Provision for income tax expense | 10,000 | 11,700 |
| Depreciation & amortization | 10,000 | 10,500 |
| Interest expense | 9,000 | 9,500 |
| EBITDA (1) | 43,300 | 48,500 |
| Adjustments: | ||
| Stock compensation (2) | 1,300 | 1,400 |
| Duplicate rent (3) | 1,500 | 1,600 |
| Investigation costs (4) | 600 | 700 |
| Integration costs (5) | 300 | 300 |
| Adjusted EBITDA (1) | $ 47,000 | $ 52,500 |
1. We are presenting EBITDA and Adjusted EBITDA, which are not measurements determined in accordance with the U.S. generally accepted accounting principles, or GAAP, because we believe these measures provide additional metrics to evaluate our operations and which we believe, when considered with both our GAAP results and the reconciliation to net income, provide a more complete understanding of our business than could be obtained absent this disclosure. We use EBITDA and Adjusted EBITDA, together with financial measures prepared in accordance with GAAP, such as revenue and cash flows from operations, to assess our historical and prospective operating performance and to enhance our understanding of our core operating performance. The use of EBITDA and Adjusted EBITDA as peformance measures permits a comparative assessment of our operating performance relative to our performance based upon GAAP results while isolating the effects of some items that vary from period to period without any correlation to core operating performance or that vary widely among similar companies.
2. Represents non-cash stock compensation expense associated with awards of restricted shares of our common stock to our key employees and our non-executive outside directors.
3. Represents rent expense incurred on the renovation and expansion of our
4. Represents the costs expected to be incurred in our investigation of the accounting issue at
5. Represents costs expected to be incurred to integrate and standardize
CONTACT: Investor Relations
John Austin , (718) 684-8415
Source: News Provided by Acquire Media