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PFGC 2017 Performance Food Group Company 2
PFGC 2017 Performance Food Group Company 2
CAGR
CAGR 8.2%
5.2%
$741 $15.3 $16.1
$12.8 $13.7
$11.5
$10.1 $10.6
$331
'99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 FY10 FY11 FY12 FY13 FY14 FY15 FY16
'10 '11 '12 '13 '14 '15 FY10 FY11 FY12 FY13 FY14 FY15 FY16
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
Foodservice Industry Customer Verticals
PFG Total Industry Total
Retail /
Hospitality
Retail /
Regional / Hospitality
Education
National Education
Regional /
Chains National
Chains
Healthcare
Other Healthcare
Other
Independent
Independent
Note: Technomic and company filings for Sysco, PFG, and US Foods. U.S. Sales only, where available; PFG estimates. 2
U.S. Foodservice Industry Structure
$B
2015 Market Size = ~ $268
4-10
Regional $23
Broadliners
11-15,000+
All Other
$163
Note: Technomic and company filings for Sysco, PFG, and US Foods. U.S. Sales only, where available; PFG estimates. 3
PFG Overview
• Third largest foodservice distributor in the
U.S. and a leading distributor to a wide Sysco
− Performance Foodservice
Others
− Vistar 69%
− PFG Customized
Note: EBITDA percentages presented for segments exclude corporate overhead and other. 4
Top 3 Distributors’ Growth Rates
Net Sales
170%
160% 158%
150%
140% 138%
130%
120% 122%
110%
100%
90%
CY2010 CY2011 CY2012 CY2013 CY2014 CY2015 CY2016
Adjusted EBITDA
170% 171%
160%
150%
140%
132%
130%
120% 128%
110%
100%
90%
CY2010 CY2011 CY2012 CY2013 CY2014 CY2015 CY2016
Note: Company filings. Definitions of Adj. EBITDA and items included as adjustments may differ between companies; all figures as reported. 5
Performance Foodservice
• Customers First
CAGR
9.5%
• Improve Mix through Street and Brands $9.1 $9.6
$7.5 $8.1
$6.1 $6.7
$5.6
• Increase geographic scope and scale
through acquisitions
FY10 FY11 FY12 FY13 FY14 FY15 FY16
CAGR
13.2% $307
$254
$208
$166 $178 $174
$146
FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY10 FY11 FY12 FY13 FY14 FY15 FY16
7
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
8
Vistar Overview
CAGR
(3.4%)
$41 $43
$39
$37 $38 $37
$34
Note: PFG company reports FY10 FY11 FY12 FY13 FY14 FY15 FY16 10
Complement Organic Growth with Acquisitions
11
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%
$ MM $ vs. PY $ MM $ vs. PY
• Net Debt
− FY2015 year-end: $ 1,413.4MM
15
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.
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Reconciliation to Adjusted EBITDA
$MM
FY2016 FY2015 FY2014 FY2013 FY2012 FY2011 FY2010
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 2010. 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 2013.
II. 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.
III. 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.
IV. 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