2017 Investor Presentation

Transcription

1 2017 Investor Presentation

2 Growth Outpacing a Growing Industry Food Away From Home PFG Net Sales $B $B $ % $741 $10.1 $ % $11.5 $12.8 $13.7 $15.3 $16.1 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 U.S. Foodservice Market Size PFG Adjusted EBITDA (1) $B $MM $225 $228 $ % $247 $256 $268 $193 $220 $ % $271 $286 $329 $367 '10 '11 '12 '13 '14 '15 Note: U.S. Department of Commerce for Food Away from Home; Technomic for U.S. Foodservice Market Size; excluding alcohol. (1) For reconciliation of non-gaap to GAAP measures see the Appendix. 1

3 Foodservice Industry Customer Verticals PFG Total Industry Total Retail / Hospitality Regional / National Chains Education Healthcare Regional / National Chains Retail / Hospitality Education Other Healthcare Independent Independent Other Continue to improve mix of independents customers Focus on growth of Performance Brands Increase geographic scope and scale through acquisitions Note: Technomic and company filings for Sysco, PFG, and US Foods. U.S. Sales only, where available; PFG estimates. 2

4 U.S. Foodservice Industry Structure $B 2015 Market Size = ~ $268 Top 3 SYY $43 USFD $23 PFG $16 $ Regional Broadliners $ ,000+ All Other $163 Note: Technomic and company filings for Sysco, PFG, and US Foods. U.S. Sales only, where available; PFG estimates. 3

5 PFG Overview Third largest foodservice distributor in the U.S. and a leading distributor to a wide variety of channels Sysco 16% US Foods 10% PFGC 6% EBITDA Profit Margins PFG Customized 0.9% Operates primarily in three segments: Others 68% Performance Foodservice 3.2% Performance Foodservice Vistar Vistar 4.2% PFG Customized 2016 Net Sales = $16.1BN 2016 Adj. EBITDA (1) = $366.6MM PFG Customized 23% 17% Vistar PFG Customized EBITDA by Segment 8% 25% Vistar Performance Foodservice Other Channels 34% 26% Performance Foodservice Street Performance Foodservice 67% (1) Note: EBITDA percentages presented for segments exclude corporate overhead and other. For reconciliation of non-gaap to GAAP measures see the Appendix. 4

6 Top 3 Distributors Growth Rates Net Sales 170% 160% 150% 140% 130% 120% 110% 100% 90% CY2010 CY2011 CY2012 CY2013 CY2014 CY2015 CY % 138% 122% 170% 160% 150% 140% 130% 120% 110% 100% 90% Adjusted EBITDA CY2010 CY2011 CY2012 CY2013 CY2014 CY2015 CY % 132% 128% Note: Company filings. Definitions of Adj. EBITDA and items included as adjustments may differ between companies; all figures as reported. 5

7 Performance Foodservice Growth Strategy Net Sales Customers First Improve Mix through Street and Brands Increase geographic scope and scale through acquisitions $5.6 $6.1 $ % $7.5 $8.1 $9.1 $9.6 Selected Customers EBITDA $ % $166 $178 $174 $208 $254 $307 Note: PFG company reports 6

8 Improve Mix through Street and Brands Street Mix of Broadline Sales 44.1% 43.1% 43.4% 41.3% 38.1% 36.9% 37.2% Company Brand Mix of Street 42.6% 40.5% 39.1% 39.4% 38.7% 37.2% 37.9% Focus on selling to our most profitable customers, independent or street restaurants, and selling our most profitable brands: Performance Brands Real organic growth to street customers has been in our 6% to 10% target range Real organic growth of Performance brands to street customers has been in our 1% to 4% greater than total growth range 7

9 Performance Brands: a $2B+ Business Proprietary brands are a key competitive advantage in the industry; growing double-digit Only the largest players in the foodservice industry have the scale to carry a broad line of differentiated brands Chefs embrace PFG s portfolio of Performance Brand SKUs and recognize the quality and specifications they bring to the table Umbrella Brands Tiered Strategy Broadline Roma Strategic Brands 8

10 Vistar Overview Growth Strategy Utilize strengths to grow both core and emerging channels Improve mix Improve cost structure through utilization of technology Enter new channels and develop new capabilities through acquisitions $B $1.7 $1.7 $1.9 Net Sales 8.4% $2.1 $2.3 $2.4 $2.7 Candy 25% Product Mix: FY2016 Snack 21% Note: PFG company reports Beverage 26% Frozen Foods 12% Theater / Concession 5% Refrigerated & dairy products 4% Paper products & cleaning supplies 3% Other 4% $MM $36 $51 $58 EBITDA 21.3% $81 $88 $106 $113 9

11 PFG Customized Overview Growth Strategy Grow share of casual dining segment through new customer wins $B Net Sales 5.2% Broaden scope of business to add fast casual chains $2.8 $2.8 $2.9 $3.2 $3.3 $3.8 $3.8 Continually improve cost structure Selected Customers $MM EBITDA (3.4%) $41 $43 $39 $37 $38 $37 $34 Note: PFG company reports 10

12 Complement Organic Growth with Acquisitions Recent Acquisitions Operating Companies Acquisition Priorities Stand-alone Broadline OpCos Bar Harbor Seafood Adjacent geographies Ellenbee Leggett Base of street business Chicago Vendor Supply Strong management team Jenny Service Fold-ins Larry Kline Meats Near current OpCo with capacity T.F. Kinnealey Base of Street business Sources of value Good employees Multiple expansion Specialty companies Synergies Street and brand growth post acquisition 11

13 FY2016 Highlights Record FY2016 results Net Sales topped $16B for the first time and increased 5.5% Gross Profit topped $2B for the first time and increased 8.7% Operating Profit grew 26.3% to $202.2MM Adjusted EBITDA (1) grew 11.6% to $366.6MM (1) For reconciliation of non-gaap to GAAP measures see the Appendix. 12

14 Full-Year FY2016 Segment Results Net Sales EBITDA $ MM $ vs. PY $ MM $ vs. PY Performance Foodservice $ 9, % $ % PFG Customized 3, % 34.1 (6.6%) Vistar 2, % % Note: PFG company reports 13

15 FY2016 Cash Flow and Balance Sheet YTD Cash Flow highlights Operating Cash Flow of $234.9MM vs. $127.4MM PY CapEx of $119.7MM vs. $98.6MM PY Acquisitions of $39MM vs. $0.4MM PY Net Debt FY2015 year-end: FY2016 year-end: $ 1,413.4MM $ 1,134.6MM Improvement vs. PY: $ 278.8MM Note: PFG company reports 14

16 Appendix 15

17 Non-GAAP Financial Measures This presentation and the accompanying financial statement tables include several financial measures that are not calculated in accordance with GAAP, including EBITDA, Adjusted EBITDA, and Adjusted Diluted Earnings per Share. Such measures are not recognized terms under GAAP, should not be considered in isolation or as a substitute for measures prepared in accordance with GAAP, and are not indicative of net income (loss) as determined under GAAP. EBITDA, Adjusted EBITDA, Adjusted Diluted Earnings per Share, and other non-gaap financial measures have limitations that should be considered before using these measures to evaluate the Company s liquidity or financial performance. EBITDA, Adjusted EBITDA, and Adjusted Diluted Earnings per Share, as presented, may not be comparable to similarly titled measures of other companies because of varying methods of calculation. Management measures operating performance based on PFG s EBITDA, defined as net income (loss) before interest expense (net of interest income), income taxes, and depreciation and amortization. PFG believe that the presentation of EBITDA enhances an investor s understanding of PFG s performance. PFG believes this measure is a useful metric to assess PFG s operating performance from period to period by excluding certain items that PFG believes are not representative of PFG s core business. PFG uses this measure to evaluate the performance of its segments and for business planning purposes. In addition, management uses Adjusted EBITDA, defined as net income (loss) before interest expense (net of interest income), income and franchise taxes, and depreciation and amortization, further adjusted to exclude certain items we do not consider part of our core operating results. Such adjustments include certain unusual, non-cash, non-recurring, cost reduction, and other adjustment items permitted in calculating covenant compliance under the company s credit and indenture agreements (other than certain pro forma adjustments permitted under our credit agreement and indenture relating to the Adjusted EBITDA contribution of acquired entities or businesses prior to the acquisition date). Under PFG s credit agreement and indenture, the Company s ability to engage in certain activities such as incurring certain additional indebtedness, making certain investments, and making restricted payments is tied to ratios based on Adjusted EBITDA (as defined in the credit agreement and indenture). Management also uses Adjusted Diluted Earnings per Share, which is calculated by adjusting the most directly comparable GAAP financial measure by excluding the same items excluded in PFG s calculation of Adjusted EBITDA to the extent that each such item was included in the applicable GAAP financial measure. PFG believes that the presentation of Adjusted EBITDA and Adjusted Diluted Earnings per Share is useful to investors because these metrics are frequently used by securities analysts, investors, and other interested parties in their evaluation of the operating performance of companies in PFG s industry. 16

18 Reconciliation to Adjusted EBITDA $MM FY2016 FY2015 FY2014 FY2013 FY2012 FY2011 FY2010 Net Income $ 68.3 $ 56.5 $ 15.5 $ 8.4 $ 21.0 $ 13.7 $ 0.9 Interest expense, net Income tax expense Depreciation Amortization of intangible assets EBITDA Non-cash items(i) (2.6) Acquisition, integration, and reorganization(ii) Non-recurring items(iii) (1.4) Productivity initiatives(iv) Multiemployer plan withdrawal(v) (0.1) Other adjustment items(vi) Adjusted EBITDA $ $ $ $ $ $ $ I. Includes adjustments for non-cash charges arising from employee equity, interest rate swap hedge ineffectiveness, and adjustments to reflect certain assets held for sale to their net realized value. Equity compensation cost was $17.2MM in fiscal 2016, $1.2MM in fiscal 2015, $0.7MM in fiscal 2014, $1.1MM in fiscal 2013, $1.1MM in fiscal 2012, $1.1MM in fiscal 2011 and $0.8MM in fiscal In addition, this includes an increase or (decrease) in the LIFO reserve of ($1.5MM) in fiscal 2016, $1.7MM in fiscal 2015, $3.0MM in fiscal 2014 and $0.8MM in fiscal II. III. IV. Includes professional fees and other costs related to completed and abandoned acquisitions; in fiscal 2015 these fees are net of a $25.0 million termination fee related to the terminated agreement to acquire 11 US Foods facilities from Sysco and US Foods, costs of integrating certain of our facilities, facility closing costs, certain equity transactions, and advisory fees paid to Blackstone and Wellspring. Fiscal 2013, includes $11.2MM for the impact of the initial fair value of inventory that was acquired as part of acquisitions. Consists primarily of an expense related to our withdrawal from a purchasing cooperative, pre-acquisition worker s compensation claims related to an insurance company that went into liquidation, a legal settlement expense, and the impact of business interruption insurance due to hurricane and other weather related and one-time events. Consists primarily of professional fees and related expenses associated with the Winning Together program and other productivity initiatives. V. Includes amounts related to the withdrawal from the Central States Southeast and Southwest Areas Pension Fund. VI. Consists of changes in fair value and costs related to settlements on our fuel collar derivatives, certain financing transactions, lease amendments, and franchise tax expense and other adjustments permitted by our credit agreements. 17