The Chefs’ Warehouse, Inc. (NASDAQ: CHEF) (the “Company” or
“Chefs’”), a premier distributor of specialty food products in the
United States and Canada, today reported financial results for its
second quarter ended June 25, 2021.
Financial highlights for the second
quarter of 2021:
- Net sales increased 111.0% to
$423.0 million for the second quarter of 2021 from $200.5 million
for the second quarter of 2020.
- GAAP net income was $1.1 million,
or $0.03 per diluted share, for the second quarter of 2021 compared
to net loss of $20.3 million, or $(0.62) per diluted share, in the
second quarter of 2020.
- Adjusted EPS1 was $0.04 for the
second quarter of 2021 compared to $(0.57) for the second quarter
of 2020.
- Adjusted EBITDA1 was $17.2 million
for the second quarter of 2021 compared to negative adjusted EBITDA
$(13.7) million for the second quarter of 2020.
“Business activity and revenue grew steadily
throughout the second quarter as existing and new customer openings
increased and COVID-related restrictions eased across many key
markets.” said Chris Pappas, Chairman and Chief Executive Officer
of the Company. “As the quarter progressed, our customers benefited
from in-door and out-door capacity growth, strengthening consumer
demand and the initial stages of menu expansion. Sales toward the
end of June 2021 were trending in line with 2019 sales, inclusive
of acquisitions completed in 2020 and 2021.”
Second Quarter Fiscal 2021
Results
Net sales for the quarter ended June 25,
2021 increased 111.0% to $423.0 million from $200.5 million for the
quarter ended June 26, 2020. Organic sales
increased $212.6 million, or 106.1% versus the prior
year quarter. Sales growth of $9.9 million, or 4.9%,
resulted from acquisitions. Organic case count increased
approximately 122.9% in the Company’s specialty category with
unique customers and placements increases
at 94.6% and 127.5%, respectively, compared to the
prior year quarter. Organic pounds sold in the Company’s
center-of-the-plate category increased approximately
66.5% compared to the prior year quarter. Estimated inflation
was 10.6% in the Company’s specialty categories
and estimated inflation was 12.1% in the center-of-the-plate
categories compared to the prior year quarter.
Gross profit increased approximately 120.8% to
$95.9 million for the second quarter of 2021 from $43.4 million for
the second quarter of 2020. Gross profit margin increased
approximately 101 basis points to 22.7% from 21.7%. Gross margins
in the Company’s specialty category increased 629 basis points and
gross margins decreased 421 basis points in the Company’s
center-of-the-plate category compared to the prior year quarter.
Prior period results include a charge of approximately $5.5 million
related to estimated inventory losses from obsolescence at the
onset of the COVID-19 pandemic.
Selling, general and administrative expenses
increased by approximately 32.6% to $90.4 million for the second
quarter of 2021 from $68.2 million for the second quarter of 2020.
These increases were primarily volume-based increases to support
our sales growth for the quarter ended June 25, 2021. As a
percentage of net sales, operating expenses were 21.4% in the
second quarter of 2021 compared to 34.0% in the second quarter of
2020.
Other operating expense increased by
approximately $0.2 million primarily due to a $0.6 million
impairment of Cambridge trademarks as a result of a shift in brand
strategy to leverage our Allen Brothers brand in our New England
region in the second quarter of fiscal 2021, partially offset by
non-cash credits of $0.1 million for changes in the fair value of
our contingent earn-out liabilities compared to non-cash charges of
$0.2 million in the prior year period.
Operating income for the second quarter of 2021
was $4.7 million compared to operating loss of $25.4 million for
the second quarter of 2020. The increase in operating income was
driven primarily by higher gross profit, partially offset by higher
selling, general and administrative, as discussed above. As a
percentage of net sales, operating income was 1.1% in the second
quarter of 2021 as compared to operating loss of 12.6% in the
second quarter of 2020.
Total interest expense decreased to $4.4 million
for the second quarter of 2021 compared to $5.8 million for the
second quarter of 2020. The decrease in interest expense is the
result of $1.2 million one-time third-party costs incurred during
the second quarter of 2020 in connection with the extension of a
majority of our senior secured term loans.
Net income for the second quarter of 2021 was
$1.1 million, or $0.03 per diluted share, compared to net loss of
$20.3 million, or $(0.62) per diluted share, for the second quarter
of 2020.
Adjusted EBITDA1 was $17.2 million for the
second quarter of 2021 compared to negative adjusted EBITDA of
$(13.7) million for the second quarter of 2020. For the second
quarter of 2021, adjusted net income1 was $1.5 million, or $0.04
per diluted share compared to adjusted net loss of $18.7 million,
or $(0.57) per diluted share for the second quarter of 2020.
Full Year 2021 Guidance
Due to the continued uncertainty regarding the
pace of broader economic recovery and the timing of event and
travel related business activity, the Company will not be providing
guidance for 2021 at this time. The Company will look to provide
guidance as it gains more clarity as to the pace of recovery,
outlook and the broader post-pandemic related environment.
Second Quarter 2021 Earnings Conference
Call
The Company will host a conference call to
discuss second quarter 2021 financial results today at 8:30 a.m.
EST. Hosting the call will be Chris Pappas, chairman and chief
executive officer, and Jim Leddy, chief financial officer. The
conference call will be webcast live from the Company’s investor
relations website at http://investors.chefswarehouse.com/. An
online archive of the webcast will be available on the Company’s
investor relations website.
Forward-Looking Statements
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 following: our sensitivity to general economic conditions,
including disposable income levels and changes in consumer
discretionary spending; our ability to expand our operations in our
existing markets and to penetrate new markets through acquisitions;
we may not achieve the benefits expected from our acquisitions,
which could adversely impact our business and operating results; we
may have difficulty managing and facilitating our future growth;
conditions beyond our control could materially affect the cost
and/or availability of our specialty food products or
center-of-the-plate products and/or interrupt our distribution
network; our increased distribution of center-of-the-plate
products, like meat, poultry and seafood, involves increased
exposure to price volatility experienced by those products; our
business is a low-margin business and our profit margins may be
sensitive to inflationary and deflationary pressures; because our
foodservice distribution operations are concentrated in certain
culinary markets, we are susceptible to economic and other
developments, including adverse weather conditions, in these areas;
fuel cost volatility may have a material adverse effect on our
business, financial condition or results of operations; our ability
to raise capital in the future may be limited; we may be unable to
obtain debt or other financing, including financing necessary to
execute on our acquisition strategy, on favorable terms or at all;
interest charged on our outstanding debt may be adversely affected
by changes in the method of determining London Interbank Offered
Rate (LIBOR), or the replacement of LIBOR with an alternative rate;
our business operations and future development could be
significantly disrupted if we lose key members of our management
team; and significant public health epidemics or pandemics,
including COVID-19, may adversely affect our business,
results of operations and financial condition. Any forward-looking
statements are made pursuant to the Private Securities Litigation
Reform Act of 1995 and, as such, speak only as of the date made. A
more detailed description of these and other risk factors is
contained in the Company’s most recent annual report on Form 10-K
filed with the SEC on February 23, 2021 and other reports
filed by the Company with the SEC since that date. The Company is
not undertaking to update any information until required by
applicable laws. Any projections of future results of operations
are based on a number of assumptions, many of which are outside the
Company’s control and should not be construed in any manner as a
guarantee that such results will in fact occur. These projections
are subject to change and could differ materially from final
reported results. The Company may from time to time update these
publicly announced projections, but it is not obligated to do
so.
About The Chefs’ Warehouse
The Chefs’ Warehouse, Inc.
(http://www.chefswarehouse.com) is a premier distributor of
specialty food products in the United States and Canada focused on
serving the specific needs of chefs who own and/or operate some of
the nation’s leading menu-driven independent restaurants, fine
dining establishments, country clubs, hotels, caterers, culinary
schools, bakeries, patisseries, chocolateries, cruise lines,
casinos and specialty food stores. The Chefs’ Warehouse, Inc.
carries and distributes more than 50,000 products to more than
34,000 customer locations throughout the United States and
Canada.
Contact:Investor Relations Jim Leddy, CFO,
(718) 684-8415
________________________1EBITDA, Adjusted EBITDA, adjusted net
income (loss) and adjusted EPS are non-GAAP measures. Please see
the schedules accompanying this earnings release for a
reconciliation of EBITDA, Adjusted EBITDA, adjusted net income
(loss) and adjusted EPS to these measures’ most directly comparable
GAAP measure.
THE CHEFS’
WAREHOUSE, INC. |
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS |
(unaudited,
in thousands except share amounts and per share data) |
|
|
Thirteen Weeks Ended |
|
Twenty-Six Weeks Ended |
|
June 25, 2021 |
|
June 26, 2020 |
|
June 25, 2021 |
|
June 26, 2020 |
Net sales |
$ |
422,968 |
|
|
$ |
200,496 |
|
|
$ |
703,185 |
|
|
$ |
575,927 |
|
Cost of sales |
327,094 |
|
|
157,070 |
|
|
548,364 |
|
|
447,013 |
|
Gross profit |
95,874 |
|
|
43,426 |
|
|
154,821 |
|
|
128,914 |
|
|
|
|
|
|
|
|
|
Selling, general and
administrative expenses |
90,358 |
|
|
68,165 |
|
|
170,603 |
|
|
177,047 |
|
Other operating (income)
expenses, net |
857 |
|
|
670 |
|
|
(313 |
) |
|
(5,666 |
) |
Operating income (loss) |
4,659 |
|
|
(25,409 |
) |
|
(15,469 |
) |
|
(42,467 |
) |
|
|
|
|
|
|
|
|
Interest expense |
4,408 |
|
|
5,772 |
|
|
9,171 |
|
|
10,896 |
|
Income (loss) before income taxes |
251 |
|
|
(31,181 |
) |
|
(24,640 |
) |
|
(53,363 |
) |
|
|
|
|
|
|
|
|
Provision for income tax
benefit |
(847 |
) |
|
(10,847 |
) |
|
(7,817 |
) |
|
(18,944 |
) |
|
|
|
|
|
|
|
|
Net income (loss) |
$ |
1,098 |
|
|
$ |
(20,334 |
) |
|
$ |
(16,823 |
) |
|
$ |
(34,419 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per
share: |
|
|
|
|
|
|
|
Basic |
$ |
0.03 |
|
|
$ |
(0.62 |
) |
|
$ |
(0.46 |
) |
|
$ |
(1.10 |
) |
Diluted |
$ |
0.03 |
|
|
$ |
(0.62 |
) |
|
$ |
(0.46 |
) |
|
$ |
(1.10 |
) |
|
|
|
|
|
|
|
|
Weighted average common
sharesoutstanding: |
|
|
|
|
|
|
|
Basic |
36,831,054 |
|
|
32,698,295 |
|
|
36,615,463 |
|
|
31,150,883 |
|
Diluted |
37,081,186 |
|
|
32,698,295 |
|
|
36,615,463 |
|
|
31,150,883 |
|
THE CHEFS’
WAREHOUSE, INC. |
CONDENSED
CONSOLIDATED BALANCE SHEETS |
AS OF
JUNE 25, 2021 AND DECEMBER 25, 2020 |
(in
thousands) |
|
|
June 25, 2021 |
|
December 25, 2020 |
|
(unaudited) |
|
|
Cash and cash equivalents |
$ |
146,920 |
|
|
$ |
193,281 |
|
Accounts receivable, net |
136,072 |
|
|
96,383 |
|
Inventories, net |
122,936 |
|
|
82,519 |
|
Prepaid expenses and other
current assets |
33,654 |
|
|
33,479 |
|
Total current assets |
439,582 |
|
|
405,662 |
|
|
|
|
|
Equipment, leasehold
improvements and software, net |
114,982 |
|
|
115,448 |
|
Operating lease right-of-use
assets |
107,736 |
|
|
115,224 |
|
Goodwill |
220,575 |
|
|
214,864 |
|
Intangible assets, net |
108,799 |
|
|
111,717 |
|
Deferred taxes, net |
15,290 |
|
|
7,535 |
|
Other assets |
3,634 |
|
|
3,875 |
|
Total assets |
$ |
1,010,598 |
|
|
$ |
974,325 |
|
|
|
|
|
|
|
|
|
Accounts payable |
$ |
107,918 |
|
|
$ |
57,515 |
|
Accrued liabilities |
29,949 |
|
|
27,924 |
|
Short-term operating lease
liabilities |
17,121 |
|
|
17,167 |
|
Accrued compensation |
15,051 |
|
|
9,401 |
|
Current portion of long-term
debt |
5,844 |
|
|
6,095 |
|
Total current liabilities |
175,883 |
|
|
118,102 |
|
|
|
|
|
Long-term debt, net of current
portion |
395,543 |
|
|
398,084 |
|
Operating lease
liabilities |
101,906 |
|
|
109,133 |
|
Other liabilities |
4,217 |
|
|
4,416 |
|
Total liabilities |
677,549 |
|
|
629,735 |
|
|
|
|
|
Preferred stock |
— |
|
|
— |
|
Common stock |
380 |
|
|
373 |
|
Additional paid in
capital |
308,852 |
|
|
303,734 |
|
Cumulative foreign currency
translation adjustment |
(1,894 |
) |
|
(2,051 |
) |
Retained earnings |
25,711 |
|
|
42,534 |
|
Stockholders’ equity |
333,049 |
|
|
344,590 |
|
|
|
|
|
Total liabilities and
stockholders’ equity |
$ |
1,010,598 |
|
|
$ |
974,325 |
|
THE CHEFS’
WAREHOUSE, INC. |
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS |
FOR THE
TWENTY-SIX WEEKS ENDED JUNE 25, 2021 AND JUNE 26,
2020 |
(unaudited,
in thousands) |
|
|
June 25, 2021 |
|
June 26, 2020 |
Cash flows from
operating activities: |
|
|
|
Net loss |
$ |
(16,823 |
) |
|
$ |
(34,419 |
) |
|
|
|
|
Adjustments to reconcile net
loss to net cash (used in) provided by operating activities: |
|
|
|
Depreciation and amortization |
10,660 |
|
|
9,675 |
|
Amortization of intangible assets |
6,643 |
|
|
6,720 |
|
Provision for allowance for doubtful accounts |
488 |
|
|
19,611 |
|
Non-cash operating lease expense |
209 |
|
|
463 |
|
(Benefit) provision for deferred income taxes |
(7,755 |
) |
|
(5,814 |
) |
Amortization of deferred financing fees |
1,364 |
|
|
1,478 |
|
Stock compensation |
5,738 |
|
|
2,850 |
|
Change in fair value of contingent earn-out liabilities |
(1,420 |
) |
|
(6,649 |
) |
Intangible asset impairment |
597 |
|
|
— |
|
Loss on asset disposal |
224 |
|
|
43 |
|
Changes in assets and
liabilities, net of acquisitions: |
|
|
|
Accounts receivable |
(37,107 |
) |
|
70,483 |
|
Inventories |
(39,347 |
) |
|
34,877 |
|
Prepaid expenses and other current assets |
(101 |
) |
|
(9,460 |
) |
Accounts payable, accrued liabilities and accrued compensation |
52,541 |
|
|
(43,398 |
) |
Other liabilities |
|
|
|
Other assets and liabilities |
167 |
|
|
1,119 |
|
Net cash provided
(used in) by operating activities |
(23,922 |
) |
|
47,579 |
|
|
|
|
|
Cash flows from
investing activities: |
|
|
|
Capital expenditures |
(9,574 |
) |
|
(4,400 |
) |
Cash paid for acquisitions, net of cash received |
(7,165 |
) |
|
(63,450 |
) |
Net cash used in
investing activities |
(16,739 |
) |
|
(67,850 |
) |
|
|
|
|
Cash flows from
financing activities: |
|
|
|
Payment of debt, finance lease and other financing obligations |
(34,372 |
) |
|
(37,439 |
) |
Proceeds from the issuance of common stock, net of issuance
costs |
— |
|
|
85,941 |
|
Proceeds from debt issuance |
51,750 |
|
|
— |
|
Payment of deferred financing fees |
(1,450 |
) |
|
(856 |
) |
Surrender of shares to pay withholding taxes |
(1,487 |
) |
|
(2,727 |
) |
Cash paid for contingent earn-out liabilities |
(83 |
) |
|
(2,927 |
) |
Borrowings under asset based loan facility |
— |
|
|
100,000 |
|
Payments under asset based loan facility |
(20,000 |
) |
|
(60,000 |
) |
Net cash (used in)
provided by financing activities |
(5,642 |
) |
|
81,992 |
|
|
|
|
|
Effect of foreign currency
translation on cash and cash equivalents |
(58 |
) |
|
(130 |
) |
|
|
|
|
Net (decrease)
increase in cash and cash equivalents |
(46,361 |
) |
|
61,591 |
|
Cash and cash equivalents at
beginning of period |
193,281 |
|
|
140,233 |
|
Cash and cash
equivalents at end of period |
$ |
146,920 |
|
|
$ |
201,824 |
|
THE CHEFS’
WAREHOUSE, INC. |
RECONCILIATION OF GAAP NET INCOME (LOSS) PER COMMON
SHARE |
(unaudited;
in thousands except share amounts and per share data) |
|
|
Thirteen Weeks Ended |
|
Twenty-Six Weeks Ended |
|
June 25, 2021 |
|
June 26, 2020 |
|
June 25, 2021 |
|
June 26, 2020 |
Numerator: |
|
|
|
|
|
|
|
Net income (loss) |
$ |
1,098 |
|
|
$ |
(20,334 |
) |
|
$ |
(16,823 |
) |
|
$ |
(34,419 |
) |
Denominator: |
|
|
|
|
|
|
|
Weighted average basic common
sharesoutstanding |
36,831,054 |
|
|
32,698,295 |
|
|
36,615,463 |
|
|
31,150,883 |
|
Dilutive effect of unvested
common shares |
250,132 |
|
|
— |
|
|
— |
|
|
— |
|
Weighted average diluted
common sharesoutstanding |
37,081,186 |
|
|
32,698,295 |
|
|
36,615,463 |
|
|
31,150,883 |
|
|
|
|
|
|
|
|
|
Net income (loss) per
share: |
|
|
|
|
|
|
|
Basic |
$ |
0.03 |
|
|
$ |
(0.62 |
) |
|
$ |
(0.46 |
) |
|
$ |
(1.10 |
) |
Diluted |
$ |
0.03 |
|
|
$ |
(0.62 |
) |
|
$ |
(0.46 |
) |
|
$ |
(1.10 |
) |
THE CHEFS’
WAREHOUSE, INC. |
RECONCILIATION OF EBITDA AND ADJUSTED EBITDA TO NET INCOME
(LOSS) |
(unaudited;
in thousands) |
|
|
Thirteen Weeks Ended |
|
Twenty-Six Weeks Ended |
|
June 25, 2021 |
|
June 26, 2020 |
|
June 25, 2021 |
|
June 26, 2020 |
Net income (loss) |
$ |
1,098 |
|
|
$ |
(20,334 |
) |
|
$ |
(16,823 |
) |
|
$ |
(34,419 |
) |
Interest expense |
4,408 |
|
|
5,772 |
|
|
9,171 |
|
|
10,896 |
|
Depreciation |
5,553 |
|
|
4,913 |
|
|
10,660 |
|
|
9,675 |
|
Amortization |
3,104 |
|
|
3,422 |
|
|
6,643 |
|
|
6,720 |
|
Provision for income tax benefit |
(847 |
) |
|
(10,847 |
) |
|
(7,817 |
) |
|
(18,944 |
) |
EBITDA (1) |
13,316 |
|
|
(17,074 |
) |
|
1,834 |
|
|
(26,072 |
) |
|
|
|
|
|
|
|
|
Adjustments: |
|
|
|
|
|
|
|
Stock compensation (2) |
3,280 |
|
|
1,999 |
|
|
5,738 |
|
|
2,850 |
|
Other operating income (3) |
857 |
|
|
670 |
|
|
(313 |
) |
|
(5,666 |
) |
Duplicate rent (4) |
694 |
|
|
698 |
|
|
1,389 |
|
|
1,396 |
|
Payroll tax credit (5) |
(1,418 |
) |
|
— |
|
|
(1,418 |
) |
|
— |
|
Moving expenses (6) |
438 |
|
|
— |
|
|
438 |
|
|
— |
|
|
|
|
|
|
|
|
|
Adjusted EBITDA (1) |
$ |
17,167 |
|
|
$ |
(13,707 |
) |
|
$ |
7,668 |
|
|
$ |
(27,492 |
) |
- 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 performance 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.
- Represents non-cash stock compensation expense associated with
awards of restricted shares of our common stock and stock options
to our key employees and our independent directors.
- Represents non-cash changes in the fair value of contingent
earn-out liabilities related to our acquisitions, non-cash charges
related to asset disposals, asset impairments, including intangible
asset impairment charges, and certain third-party deal costs
incurred in connection with our acquisitions or financing
arrangements.
- Represents duplicate rent and occupancy costs for our Los
Angeles, CA facility.
- Represents a payroll tax credit earned in accordance with the
Employee Retention Credit under the CARES Act.
- Represents moving expenses for the consolidation of certain
facilities in New England.
THE CHEFS’
WAREHOUSE, INC. |
RECONCILIATION OF ADJUSTED NET INCOME (LOSS) TO NET INCOME
(LOSS) |
(unaudited;
in thousands except share amounts and per share data) |
|
|
Thirteen Weeks Ended |
|
Twenty-Six Weeks Ended |
|
June 25, 2021 |
|
June 26, 2020 |
|
June 25, 2021 |
|
June 26, 2020 |
Net income (loss) |
$ |
1,098 |
|
|
$ |
(20,334 |
) |
|
$ |
(16,823 |
) |
|
$ |
(34,419 |
) |
|
|
|
|
|
|
|
|
Adjustments to Reconcile Net
Income (Loss)to Adjusted Net Income (Loss) (1): |
|
|
|
|
|
|
|
Other operating expenses (2) |
857 |
|
|
670 |
|
|
(313 |
) |
|
(5,666 |
) |
Duplicate rent (3) |
694 |
|
|
698 |
|
|
1,389 |
|
|
1,396 |
|
Moving expenses (4) |
438 |
|
|
— |
|
|
438 |
|
|
— |
|
Third party debt modification fees (5) |
— |
|
|
1,233 |
|
|
— |
|
|
1,233 |
|
Payroll tax credit (6) |
(1,418 |
) |
|
— |
|
|
(1,418 |
) |
|
— |
|
Tax effect of adjustments (7) |
(160 |
) |
|
(980 |
) |
|
(27 |
) |
|
1,078 |
|
|
|
|
|
|
|
|
|
Total adjustments |
411 |
|
|
1,621 |
|
|
69 |
|
|
(1,959 |
) |
|
|
|
|
|
|
|
|
Adjusted net income
(loss) |
$ |
1,509 |
|
|
$ |
(18,713 |
) |
|
$ |
(16,754 |
) |
|
$ |
(36,378 |
) |
|
|
|
|
|
|
|
|
Diluted adjusted income (loss)
per common share |
$ |
0.04 |
|
|
$ |
(0.57 |
) |
|
$ |
(0.46 |
) |
|
$ |
(1.17 |
) |
|
|
|
|
|
|
|
|
Diluted shares outstanding -
adjusted |
37,081,186 |
|
|
32,698,295 |
|
|
36,615,463 |
|
|
31,150,883 |
|
- We are presenting adjusted net income and adjusted earnings per
common share (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 adjusted net income available to common
stockholders and adjusted 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 adjusted net income available to common
stockholders and adjusted 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 performance or that vary widely among
similar companies.
- Represents non-cash changes in the fair value of contingent
earn-out liabilities related to our acquisitions, non-cash charges
related to asset disposals, asset impairments, including intangible
asset impairments, and certain third-party deal costs incurred in
connection with our acquisitions or financing arrangements.
- Represents duplicate rent and occupancy costs for our Los
Angeles, CA facility.
- Represents moving expenses for the consolidation of certain
facilities in New England.
- Represents interest expense related to investment banking fees
paid in connection with the modification of our senior secured term
loan.
- Represents a payroll tax credit earned in accordance with the
Employee Retention Credit under the CARES Act.
- Represents the tax effect of items 2 through 6 above.
THE CHEFS’ WAREHOUSE, INC. |
RECONCILIATION OF ADJUSTED EARNINGS PER COMMON
SHARE |
(unaudited; in thousands except share amounts and per share
data) |
|
|
Thirteen Weeks Ended |
|
Twenty-Six Weeks Ended |
|
June 25, 2021 |
|
June 26, 2020 |
|
June 25, 2021 |
|
June 26, 2020 |
Numerator: |
|
|
|
|
|
|
|
Adjusted net income (loss) |
$ |
1,509 |
|
|
$ |
(18,713 |
) |
|
$ |
(16,754 |
) |
|
$ |
(36,378 |
) |
Denominator: |
|
|
|
|
|
|
|
Weighted average basic common
shares outstanding |
36,831,054 |
|
|
32,698,295 |
|
|
36,615,463 |
|
|
31,150,883 |
|
Dilutive effect of unvested
common shares |
250,132 |
|
|
— |
|
|
— |
|
|
— |
|
Weighted average diluted
common shares outstanding |
37,081,186 |
|
|
32,698,295 |
|
|
36,615,463 |
|
|
31,150,883 |
|
|
|
|
|
|
|
|
|
Adjusted earnings per
share: |
|
|
|
|
|
|
|
Diluted |
$ |
0.04 |
|
|
$ |
(0.57 |
) |
|
$ |
(0.46 |
) |
|
$ |
(1.17 |
) |
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