US Foods Holding's Mixed Bag Of Q4 Performance With 5% Sales Growth, CEO Touts 'Long-Range Plan'

US Foods Holding Corp. USFD reported fourth-quarter revenue of $8.936 billion, beating the street view of $8.791 billion. Net sales increased 4.9% year over year.

Total case volume increased 5.6% in the quarter under review, while independent restaurant case volume increased 7.3%.

Fourth quarter gross profit increased 9.4% to $1.6 billion, while adjusted EBITDA increased 10.9% to $388 million. Adjusted EBITDA margin was 4.3%, an increase of 23 basis points compared to the prior year. 

Fourth quarter gross profits gained from increased total case volume, cost of goods sold optimization, optimized pricing, and a favorable year-over-year LIFO adjustment. 

“Through execution of our strategy and long-range plan, we captured profitable market share and enhanced margins,” said Dave Flitman, CEO. “This resulted in record full-year 2023 Adjusted EBITDA of $1.56 billion,” Flitman added.

During the fourth quarter, the company acquired Saladino’s Foodservice, an independently owned broadline distributor based in central California for a purchase price of $56 million.

Net Debt at the end of fiscal year 2023 was $4.4 billion. The company exited the quarter with cash and equivalents worth $269 million.

Quarterly adjusted diluted earnings per share increased 16.4% to 64 cents, missing the street view of 67 cents.

Outlook: For the first quarter, the company sees adjusted EBITDA of $340 million to $355 million.

For FY24, the company sees net sales of $37.5 billion to $38.5 billion (estimate: $37.32 billion), with adjusted EPS of $3.00-$3.20 (estimate: $3.23).

Price Action: USFD shares are trading lower by 0.53% to $46.70 premarket on the last check Thursday.