The Chefs’ Warehouse, Inc. (NASDAQ: CHEF) (the “Company”), a
premier distributor of specialty food products in the United States
and Canada, today reported financial results for its fourth quarter
ended December 27, 2019.
Financial highlights for the fourth quarter of 2019
compared to the fourth quarter of 2018:
- Net sales increased 8.2% to $426.5 million for the fourth
quarter of 2019 from $394.1 million for the fourth quarter of
2018.
- GAAP net income was $10.9 million, or $0.36 per diluted share,
for the fourth quarter of 2019 compared to $8.9 million, or $0.30
per diluted share, in the fourth quarter of 2018.
- Adjusted EPS1 was $0.39 for the fourth quarter of 2019 compared
to $0.32 for the fourth quarter of 2018.
- Adjusted EBITDA1 was $28.2 million for the fourth quarter of
2019 compared to $24.6 million for the fourth quarter of 2018.
“We finished 2019 with solid revenue performance amidst a
healthy consumer demand environment during the fourth quarter,”
said Chris Pappas, chairman and chief executive officer of The
Chefs’ Warehouse, Inc. “We enter 2020 celebrating our thirty-fifth
year of operations. We are excited to continue on our path of
growth and our mission of providing our customers with the highest
quality ingredients and service that the Chefs’ Warehouse family
and portfolio of brands have delivered since our company’s
inception.”
Fourth Quarter Fiscal 2019 Results
Net sales for the quarter ended
December 27, 2019 increased 8.2% to $426.5 million from $394.1
million for the quarter ended December 28, 2018. Organic
growth contributed $16.2 million, or 4.1% to sales
growth in the quarter. The remaining sales
growth of $16.2 million, or 4.1%, resulted from
acquisitions. Organic case count grew approximately 2.3% in
the Company’s specialty category with unique customers and
placements growth at 3.8% and 2.5%, respectively,
compared to the prior year quarter. Pounds sold in the Company’s
center-of-the-plate category decreased approximately
2.1% compared to the prior year quarter. Estimated inflation
was 3.1% in the Company’s specialty categories
and 5.3% in the center-of-the-plate categories compared to the
prior year quarter.
Gross profit increased approximately 5.3% to
$107.7 million for the fourth quarter of 2019 from $102.3 million
for the fourth quarter of 2018. Gross profit margin decreased
approximately 71 basis points to 25.3% from 26.0%. Gross margins in
the Company’s specialty category increased 36 basis points and
gross margins decreased 185 basis points in the Company’s
center-of-the-plate category compared to the prior year
quarter.
Total operating expenses increased by
approximately 5.6% to $89.3 million for the fourth quarter of 2019
from $84.5 million for the fourth quarter of 2018. As a percentage
of net sales, operating expenses were 20.9% in the fourth quarter
of 2019 compared to 21.4% in the fourth quarter of 2018. Operating
expenses as a percentage of sales was favorably impacted by lower
general and administrative expenses, primarily due to lower
compensation and benefits related costs, partially offset by higher
warehouse costs related to the Company’s investment in Texas and
its new facility in Los Angeles.
Operating income for the fourth quarter of 2019
was $18.4 million compared to $17.8 million for the fourth quarter
of 2018. The increase in operating income was driven primarily by
increased gross profit, offset in part by higher operating
expenses, as discussed above. As a percentage of net sales,
operating income was 4.4% in the fourth quarter of 2019 as compared
to 4.6% in the fourth quarter of 2018.
Total interest expense decreased to $4.4 million
for the fourth quarter of 2019 compared to $5.7 million for the
fourth quarter of 2018. The decrease was primarily driven by
a $1.1 million write-off of deferred financing fees
during the fourth quarter of 2018 associated with the re-pricing of
the Company’s Term Loan and lower effective interest charged on the
Company’s outstanding debt.
Net income for the fourth quarter of 2019 was
$10.9 million, or $0.36 per diluted share, compared to net income
of $8.9 million, or $0.30 per diluted share, for the fourth quarter
of 2018.
Adjusted EBITDA1 was $28.2 million for the
fourth quarter of 2019 compared to $24.6 million for the fourth
quarter of 2018. For the fourth quarter of 2019, adjusted net
income1 was $12.1 million, or $0.39 per diluted share compared to
adjusted net income of $9.6 million, or $0.32 per diluted share for
the fourth quarter of 2018.
Full Year 2020 Guidance
Based on current trends in the business, the Company is
providing the following financial guidance for fiscal year
2020:
- Net sales between $1.85 billion and $1.91 billion
- Gross profit between $478.0 million and $492.0 million
- Net income between $26.9 million and $29.8 million
- Net income per diluted share between $0.86 and $0.95
- Adjusted EBITDA1 between $102.0 million and $106.0 million
- Adjusted EPS1 between $0.91 and $1.00
This guidance is based on an effective tax rate of approximately
28.0% for fiscal 2020. Our full year estimated diluted share count
is approximately 33.6 million shares. The Company expects its
senior convertible notes to be dilutive for the full year and
accordingly, those shares that could be issued upon conversion of
the notes are included in the fully diluted share count.
1EBITDA, Adjusted EBITDA, adjusted net income 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 and adjusted EPS to these measures’ most
directly comparable GAAP measure.
Fourth Quarter 2019 Earnings Conference
Call
The Company will host a conference call to
discuss fourth quarter 2019 financial results today at 5:00 p.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/. The call
can also be accessed live over the phone by dialing (877) 407-4018,
or for international callers (201) 689-8471. A replay will be
available one hour after the call and can be accessed by dialing
(844) 512-2921 or (412) 317-6671 for international callers; the
conference ID is 13698025. The replay will be available until
Wednesday, February 19, 2020, and an online archive of the
webcast will be available on the Company’s investor relations
website for 30 days.
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 disposable income levels and changes in
consumer discretionary spending; the Company’s ability to expand
its operations in its existing markets and to penetrate new markets
through acquisitions; the Company may not achieve the benefits
expected from its acquisitions, which could adversely impact its
business and operating results; the Company may have difficulty
managing and facilitating its future growth; conditions beyond the
Company’s control could materially affect the cost and/or
availability of its specialty food products or center-of-the-plate
products and/or interrupt its distribution network; the Company’s
increased distribution of center-of-the-plate products, like meat,
poultry and seafood, involves increased exposure to price
volatility experienced by those products; the Company’s business is
a low-margin business and its profit margins may be sensitive to
inflationary and deflationary pressures; because the Company’s
foodservice distribution operations are concentrated in certain
culinary markets, the Company is susceptible to economic and other
developments, including adverse weather conditions, in these areas;
fuel cost volatility may have a material adverse effect on the
Company’s business, financial condition or results of operations;
the Company’s ability to raise capital in the future may be
limited; the Company may be unable to obtain debt or other
financing, including financing necessary to execute on our
acquisition strategy, on favorable terms or at all; and the
Company’s business operations and future development could be
significantly disrupted if it loses key members of its management
team. 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 Securities and
Exchange Commission (“SEC”) on March 1, 2019 and other reports
filed by the Company with the SEC since that date. The Company is
not undertaking to update any information in the foregoing report
until the effective date of its future reports 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, chocolatiers, cruise lines, casinos
and specialty food stores. The Chefs’ Warehouse, Inc. carries and
distributes more than 55,000 products to more than 34,000 customer
locations throughout the United States and Canada.
Contact:Investor RelationsJim Leddy, CFO, (718)
684-8415
THE CHEFS’ WAREHOUSE,
INC.CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS(unaudited, in thousands except share
amounts and per share data)
|
Thirteen Weeks Ended |
|
Fifty-Two Weeks Ended |
|
December 27,2019 |
|
December 28,2018 |
|
December 27,2019 |
|
December 28,2018 |
Net Sales |
$ |
426,507 |
|
$ |
394,056 |
|
$ |
1,591,834 |
|
$ |
1,444,609 |
Cost of Sales |
318,811 |
|
291,764 |
|
1,185,481 |
|
1,077,562 |
Gross Profit |
107,696 |
|
102,292 |
|
406,353 |
|
367,047 |
|
|
|
|
|
|
|
|
Operating Expenses |
89,262 |
|
84,490 |
|
355,585 |
|
318,289 |
Operating Income |
18,434 |
|
17,802 |
|
50,768 |
|
48,758 |
|
|
|
|
|
|
|
|
Interest Expense |
4,351 |
|
5,709 |
|
18,264 |
|
20,745 |
Loss on Asset Disposal |
37 |
|
139 |
|
101 |
|
169 |
Income Before Income
Taxes |
14,046 |
|
11,954 |
|
32,403 |
|
27,844 |
|
|
|
|
|
|
|
|
Provision for Income Tax
Expense |
3,158 |
|
3,072 |
|
8,210 |
|
7,442 |
|
|
|
|
|
|
|
|
Net Income |
$ |
10,888 |
|
$ |
8,882 |
|
$ |
24,193 |
|
$ |
20,402 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income Per Share: |
|
|
|
|
|
|
|
Basic |
$ |
0.37 |
|
$ |
0.30 |
|
$ |
0.82 |
|
$ |
0.71 |
Diluted |
$ |
0.36 |
|
$ |
0.30 |
|
$ |
0.81 |
|
$ |
0.70 |
|
|
|
|
|
|
|
|
Weighted Average Common
SharesOutstanding: |
|
|
|
|
|
|
|
Basic |
29,595,723 |
|
29,438,806 |
|
29,532,342 |
|
28,703,265 |
Diluted |
31,134,821 |
|
29,828,252 |
|
30,073,338 |
|
29,678,919 |
THE CHEFS’ WAREHOUSE,
INC.CONDENSED CONSOLIDATED BALANCE
SHEETAS OF DECEMBER 27, 2019 AND
DECEMBER 28, 2018(in thousands)
|
December 27, 2019 |
|
December 28, 2018 |
|
(unaudited) |
|
|
Cash |
$ |
140,233 |
|
|
$ |
42,410 |
|
Accounts receivable, net |
175,044 |
|
|
161,758 |
|
Inventories, net |
124,056 |
|
|
112,614 |
|
Prepaid expenses and other
current assets |
13,823 |
|
|
11,953 |
|
Total current assets |
453,156 |
|
|
328,735 |
|
|
|
|
|
Equipment, leasehold
improvements and software, net |
92,846 |
|
|
85,276 |
|
Operating lease right-of-use
assets (1) |
127,649 |
|
|
— |
|
Goodwill |
197,743 |
|
|
184,280 |
|
Intangible assets, net |
138,751 |
|
|
130,033 |
|
Other assets |
3,534 |
|
|
4,074 |
|
Total assets |
$ |
1,013,679 |
|
|
$ |
732,398 |
|
|
|
|
|
|
|
|
|
Accounts payable |
$ |
94,097 |
|
|
$ |
87,799 |
|
Accrued liabilities |
29,847 |
|
|
24,810 |
|
Short-term operating lease
liabilities (1) |
17,453 |
|
|
— |
|
Accrued compensation |
8,033 |
|
|
12,872 |
|
Current portion of long-term
debt |
721 |
|
|
61 |
|
Total current liabilities |
150,151 |
|
|
125,542 |
|
|
|
|
|
Long-term debt, net of current
portion |
386,106 |
|
|
278,169 |
|
Operating lease liabilities
(1) |
120,572 |
|
|
— |
|
Deferred taxes, net |
10,883 |
|
|
9,601 |
|
Other liabilities |
10,034 |
|
|
10,410 |
|
Total liabilities |
677,746 |
|
|
423,722 |
|
|
|
|
|
Preferred stock |
— |
|
|
— |
|
Common stock |
304 |
|
|
300 |
|
Additional paid in
capital |
212,240 |
|
|
207,326 |
|
Cumulative foreign currency
translation adjustment |
(2,048 |
) |
|
(2,221 |
) |
Retained earnings |
125,437 |
|
|
103,271 |
|
Stockholders’ equity |
335,933 |
|
|
308,676 |
|
|
|
|
|
Total liabilities and
stockholders’ equity |
$ |
1,013,679 |
|
|
$ |
732,398 |
|
(1) Fiscal 2019 includes new balance sheet captions due to the
adoption of the new lease accounting standard, effective on the
first day of fiscal 2019
THE CHEFS’ WAREHOUSE,
INC.CONDENSED CONSOLIDATED STATEMENT OF CASH
FLOWSFOR THE FIFTY-TWO WEEKS ENDED
DECEMBER 27, 2019 AND DECEMBER 28,
2018(unaudited, in thousands)
|
December 27,2019 |
|
December 28,2018 |
Cash flows from
operating activities: |
|
|
|
Net income |
$ |
24,193 |
|
|
$ |
20,402 |
|
|
|
|
|
Adjustments to reconcile net
income to net cash provided by operating activities: |
|
|
|
Depreciation and amortization |
13,328 |
|
|
10,296 |
|
Amortization of intangible assets |
12,663 |
|
|
11,910 |
|
Provision for allowance for doubtful accounts |
4,981 |
|
|
3,790 |
|
Non-cash operating lease expense |
2,043 |
|
|
770 |
|
Deferred taxes |
2,063 |
|
|
2,554 |
|
Amortization of deferred financing fees |
2,168 |
|
|
3,155 |
|
Stock compensation |
4,399 |
|
|
4,094 |
|
Change in fair value of contingent earn-out liabilities |
5,879 |
|
|
1,448 |
|
Loss on asset disposal |
101 |
|
|
169 |
|
Changes in assets and
liabilities, net of acquisitions: |
|
|
|
Accounts receivable |
(13,213 |
) |
|
(19,466 |
) |
Inventories |
(9,439 |
) |
|
(6,330 |
) |
Prepaid expenses and other current assets |
(1,813 |
) |
|
120 |
|
Accounts payable, accrued liabilities and accrued compensation |
3,775 |
|
|
13,677 |
|
Other assets and liabilities |
(6,121 |
) |
|
(1,507 |
) |
Net cash provided by
operating activities |
45,007 |
|
|
45,082 |
|
|
|
|
|
Cash flows from
investing activities: |
|
|
|
Capital expenditures |
(16,077 |
) |
|
(19,817 |
) |
Cash paid for acquisitions, net of cash received |
(28,077 |
) |
|
(13,901 |
) |
Proceeds from asset disposals |
— |
|
|
30 |
|
Net cash used in
investing activities |
(44,154 |
) |
|
(33,688 |
) |
|
|
|
|
Cash flows from
financing activities: |
|
|
|
Payment of debt, finance lease and other financing obligations |
(1,894 |
) |
|
(49,360 |
) |
Proceeds from debt issuance |
150,000 |
|
|
— |
|
Payment of deferred financing fees |
(5,082 |
) |
|
(1,502 |
) |
Proceeds from exercise of stock options |
1,541 |
|
|
— |
|
Surrender of shares to pay withholding taxes |
(1,022 |
) |
|
(764 |
) |
Cash paid for contingent earn-out liability |
(2,412 |
) |
|
(3,000 |
) |
Borrowings under asset based loan facility |
— |
|
|
47,100 |
|
Payments under asset based loan facility |
(44,184 |
) |
|
(2,916 |
) |
Net cash provided by
(used in) financing activities |
96,947 |
|
|
(10,442 |
) |
|
|
|
|
Effect of foreign currency
translation on cash and cash equivalents |
23 |
|
|
(46 |
) |
|
|
|
|
Net increase in cash
and cash equivalents |
97,823 |
|
|
906 |
|
Cash and cash equivalents at
beginning of period |
42,410 |
|
|
41,504 |
|
Cash and cash
equivalents at end of period |
$ |
140,233 |
|
|
$ |
42,410 |
|
THE CHEFS’ WAREHOUSE,
INC.RECONCILIATION OF GAAP NET INCOME PER COMMON
SHARE(unaudited; in thousands except share amounts
and per share data)
|
Thirteen Weeks Ended |
|
Fifty-Two Weeks Ended |
|
December 27, 2019 |
|
December 28, 2018 |
|
December 27, 2019 |
|
December 28, 2018 |
Numerator: |
|
|
|
|
|
|
|
Net Income |
$ |
10,888 |
|
|
$ |
8,882 |
|
|
$ |
24,193 |
|
|
$ |
20,402 |
|
Add effect of dilutive
securities: |
|
|
|
|
|
|
|
Interest on convertible notes, net of tax |
215 |
|
|
— |
|
|
207 |
|
|
362 |
|
Net Income available to common
shareholders |
$ |
11,103 |
|
|
$ |
8,882 |
|
|
$ |
24,400 |
|
|
$ |
20,764 |
|
Denominator: |
|
|
|
|
|
|
|
Weighted average basic common
sharesoutstanding |
29,595,723 |
|
|
29,438,806 |
|
|
29,532,342 |
|
|
28,703,265 |
|
Dilutive effect of unvested
common shares |
204,483 |
|
|
389,446 |
|
|
211,050 |
|
|
270,520 |
|
Dilutive effect of convertible
notes |
1,334,615 |
|
|
— |
|
|
329,946 |
|
|
705,134 |
|
Weighted average diluted
common sharesoutstanding |
31,134,821 |
|
|
29,828,252 |
|
|
30,073,338 |
|
|
29,678,919 |
|
|
|
|
|
|
|
|
|
Net Income Per Share: |
|
|
|
|
|
|
|
Basic |
$ |
0.37 |
|
|
$ |
0.30 |
|
|
$ |
0.82 |
|
|
$ |
0.71 |
|
Diluted |
$ |
0.36 |
|
|
$ |
0.30 |
|
|
$ |
0.81 |
|
|
$ |
0.70 |
|
THE CHEFS’ WAREHOUSE,
INC.RECONCILIATION OF EBITDA AND ADJUSTED EBITDA
TO NET INCOME(unaudited; in
thousands)
|
Thirteen Weeks Ended |
|
Fifty-Two Weeks Ended |
|
December 27,2019 |
|
December 28,2018 |
|
December 27,2019 |
|
December 28,2018 |
Net Income |
$ |
10,888 |
|
|
$ |
8,882 |
|
|
$ |
24,193 |
|
|
$ |
20,402 |
|
Interest expense |
4,351 |
|
|
5,709 |
|
|
18,264 |
|
|
20,745 |
|
Depreciation |
3,789 |
|
|
3,062 |
|
|
13,328 |
|
|
10,296 |
|
Amortization |
3,178 |
|
|
2,961 |
|
|
12,663 |
|
|
11,910 |
|
Provision for income tax expense |
3,158 |
|
|
3,072 |
|
|
8,210 |
|
|
7,442 |
|
EBITDA (1) |
25,364 |
|
|
23,686 |
|
|
76,658 |
|
|
70,795 |
|
|
|
|
|
|
|
|
|
Adjustments: |
|
|
|
|
|
|
|
Stock compensation (2) |
1,488 |
|
|
1,095 |
|
|
4,399 |
|
|
4,094 |
|
Duplicate rent (3) |
698 |
|
|
— |
|
|
1,503 |
|
|
14 |
|
Integration and deal costs/third partytransaction costs (4) |
93 |
|
|
277 |
|
|
379 |
|
|
608 |
|
Change in fair value of earn-out obligations (5) |
548 |
|
|
(578 |
) |
|
5,879 |
|
|
1,448 |
|
Loss on asset disposal (6) |
37 |
|
|
139 |
|
|
101 |
|
|
169 |
|
Moving expenses (7) |
— |
|
|
28 |
|
|
61 |
|
|
49 |
|
|
|
|
|
|
|
|
|
Adjusted EBITDA (1) |
$ |
28,228 |
|
|
$ |
24,647 |
|
|
$ |
88,980 |
|
|
$ |
77,177 |
|
- 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 duplicate rent and occupancy costs for our Los
Angeles, CA and Toronto, Canada facilities.
- Represents transaction related costs incurred to complete and
integrate acquisitions, including due diligence, legal and
integration.
- Represents the non-cash change in fair value of contingent
earn-out liabilities related to our acquisitions.
- Represents the non-cash charge related to the disposal of
certain equipment.
- Represents moving expenses for the consolidation and expansion
of our Ridgefield, CT and Toronto, Canada facilities.
THE CHEFS’ WAREHOUSE,
INC.RECONCILIATION OF ADJUSTED NET INCOME TO NET
INCOME(unaudited; in thousands except share
amounts and per share data)
|
Thirteen Weeks Ended |
|
Fifty-Two Weeks Ended |
|
December 27,2019 |
|
December 28,2018 |
|
December 27,2019 |
|
December 28,2018 |
Net Income |
$ |
10,888 |
|
|
$ |
8,882 |
|
|
$ |
24,193 |
|
|
$ |
20,402 |
|
|
|
|
|
|
|
|
|
Adjustments to Reconcile Net
Income to Adjusted Net Income (1): |
|
|
|
|
|
|
|
Duplicate rent (2) |
698 |
|
|
— |
|
|
1,503 |
|
|
14 |
|
Integration and deal costs/third party transaction costs (3) |
93 |
|
|
277 |
|
|
379 |
|
|
608 |
|
Moving expenses (4) |
— |
|
|
28 |
|
|
61 |
|
|
49 |
|
Change in fair value of earn-out obligations (5) |
548 |
|
|
(578 |
) |
|
5,879 |
|
|
1,448 |
|
Loss on asset disposal (6) |
37 |
|
|
139 |
|
|
101 |
|
|
169 |
|
Write-off of unamortized deferred financing fees (7) |
— |
|
|
1,081 |
|
|
— |
|
|
1,081 |
|
Tax effect of adjustments (8) |
(205 |
) |
|
(253 |
) |
|
(2,007 |
) |
|
(900 |
) |
Total Adjustments |
1,171 |
|
|
694 |
|
|
5,916 |
|
|
2,469 |
|
Adjusted Net Income |
$ |
12,059 |
|
|
$ |
9,576 |
|
|
$ |
30,109 |
|
|
$ |
22,871 |
|
|
|
|
|
|
|
|
|
Diluted Earnings per Share -
Adjusted |
$ |
0.39 |
|
|
$ |
0.32 |
|
|
$ |
1.01 |
|
|
$ |
0.78 |
|
|
|
|
|
|
|
|
|
Diluted Shares Outstanding -
Adjusted |
31,225,875 |
|
|
29,828,252 |
|
|
30,073,338 |
|
|
29,678,919 |
|
- We are presenting adjusted net income and adjusted earnings per
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 duplicate rent and occupancy costs for our Los
Angeles, CA and Toronto, Canada facilities.
- Represents transaction related costs incurred to complete and
integrate acquisitions, including due diligence, legal and
integration.
- Represents moving expenses for the consolidation and expansion
of our Ridgefield, CT and Toronto, Canada facilities.
- Represents the non-cash change in fair value of contingent
earn-out liabilities related to our acquisitions.
- Represents the non-cash charge related to the disposal of
certain equipment.
- Represents the write-off of unamortized deferred financing fees
as a result of the repricing of our term loan during the fourth
quarter of 2018.
- Represents the tax effect of items 2 through 7 above.
THE CHEFS’ WAREHOUSE,
INC.RECONCILIATION OF ADJUSTED NET INCOME PER
COMMON SHARE(unaudited; in thousands except share
amounts and per share data)
|
Thirteen Weeks Ended |
|
Fifty-Two Weeks Ended |
|
December 27,2019 |
|
December 28,2018 |
|
December 27,2019 |
|
December 28,2018 |
Numerator: |
|
|
|
|
|
|
|
Adjusted Net Income |
$ |
12,059 |
|
|
$ |
9,576 |
|
|
$ |
30,109 |
|
|
$ |
22,871 |
|
Add effect of dilutive
securities: |
|
|
|
|
|
|
|
Interest on convertible notes, net of tax |
250 |
|
|
— |
|
|
207 |
|
|
362 |
|
Adjusted Net Income available
to commonshareholders |
$ |
12,309 |
|
|
$ |
9,576 |
|
|
$ |
30,316 |
|
|
$ |
23,233 |
|
Denominator: |
|
|
|
|
|
|
|
Weighted average basic common
sharesoutstanding |
29,595,723 |
|
|
29,438,806 |
|
|
29,532,342 |
|
|
28,703,265 |
|
Dilutive effect of unvested
common shares |
204,483 |
|
|
389,446 |
|
|
211,050 |
|
|
270,520 |
|
Dilutive effect of convertible
notes |
1,425,669 |
|
|
— |
|
|
329,946 |
|
|
705,134 |
|
Weighted average diluted
common sharesoutstanding |
31,225,875 |
|
|
29,828,252 |
|
|
30,073,338 |
|
|
29,678,919 |
|
|
|
|
|
|
|
|
|
Adjusted Net Income per
share: |
|
|
|
|
|
|
|
Diluted |
$ |
0.39 |
|
|
$ |
0.32 |
|
|
$ |
1.01 |
|
|
$ |
0.78 |
|
THE CHEFS’ WAREHOUSE,
INC.RECONCILIATION OF ADJUSTED EBITDA GUIDANCE FOR
FISCAL 2020(unaudited; in thousands)
|
Low-End Guidance |
|
High-End Guidance |
Net Income: |
$ |
26,850 |
|
|
$ |
29,800 |
|
Provision for income tax expense |
10,450 |
|
|
11,500 |
|
Depreciation & amortization |
35,500 |
|
|
35,500 |
|
Interest expense |
20,000 |
|
|
20,000 |
|
EBITDA (1) |
92,800 |
|
|
96,800 |
|
|
|
|
|
Adjustments: |
|
|
|
Stock compensation (2) |
6,800 |
|
|
6,800 |
|
Duplicate rent (3) |
2,000 |
|
|
2,000 |
|
Change in fair value of earn-out obligations (4) |
300 |
|
|
300 |
|
Moving expenses (5) |
100 |
|
|
100 |
|
|
|
|
|
Adjusted EBITDA (1) |
$ |
102,000 |
|
|
$ |
106,000 |
|
- We are presenting estimated 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
currently estimated results and which we believe, when
considered with both our estimated GAAP results and the
reconciliation to our estimated 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 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 rent and occupancy costs expected to be incurred in
connection with our facility consolidations while we are unable to
use those facilities.
- Represents the non-cash change in fair value of contingent
earn-out liabilities related to our acquisitions.
- Represents moving expenses for the consolidation and expansion
of our facilities.
THE CHEFS’ WAREHOUSE,
INC.2020 FULLY DILUTED EPS GUIDANCE RECONCILIATION
TO 2020 ADJUSTED EPS GUIDANCE (1)(2)
|
Low-End |
|
High-End |
|
Guidance |
|
Guidance |
|
|
|
|
Net income per diluted share |
$ |
0.86 |
|
$ |
0.95 |
|
|
|
|
Duplicate rent (3) |
0.04 |
|
0.04 |
Change in fair value of
earn-out obligations (4) |
0.01 |
|
0.01 |
|
|
|
|
Adjusted net income per
diluted share |
$ |
0.91 |
|
$ |
1.00 |
- We are presenting estimated adjusted 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 estimated
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 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 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.
- Guidance is based upon an estimated effective tax rate of 28.0%
and an estimated fully diluted share count of approximately 34
million shares.
- Represents rent and occupancy costs expected to be incurred in
connection with our facility consolidations while we are unable to
use those facilities.
- Represents the non-cash change in fair value of contingent
earn-out liabilities related to our acquisitions.
Chefs Warehouse (NASDAQ:CHEF)
Historical Stock Chart
From Mar 2024 to Apr 2024
Chefs Warehouse (NASDAQ:CHEF)
Historical Stock Chart
From Apr 2023 to Apr 2024