Vending

Performance Food Group boosts sales for Q2 2021, Vistar falls

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February 3, 2021

Performance Food Group's net sales for the second quarter of fiscal 2021 grew 12.8% from $6.06 billion in the prior year's second quarter to $6.8 billion for the three months ending Dec. 26, 2020, primarily attributable to the acquisition of Reinhart, partially offset by the effects of the COVID-19 pandemic, according to an earnings release. The acquisition of Reinhart contributed $1.34 billion to net sales for the second quarter of fiscal 2021.

Diluted earnings per share declined 66.7% from 39 cents in the prior year's second quarter to 13 cents per share in the second quarter of fiscal 2021. Adjusted diluted EPS declined 39.7% from 58 cents in the prior year's second quarter to 35 cents per share in the second quarter of fiscal 2021.

Net sales for Vistar decreased 11.9% from $2.22 billion in the prior year's second quarter to $2 billion for the quarter ending Dec. 26, 2020, driven by the continued economic effects of the COVID-19 pandemic.

Performance Food Group's revenue missed analysts' estimates by $50 million for the quarter, while the 35-cents non-GAAP EPS beat estimates by 8 cents and GAAP EPS beat estimates by 7 cents, according to Seeking Alpha.

Shares traded at $50.80 today against a 52-week range of $11.42-$53.99.

"Despite the new challenges the holiday season brought for our business, our foodservice segment still delivered a solid quarter while continuing the smooth integration of Reinhart. Looking ahead, I believe PFG is well-positioned to take advantage of a better operating environment in the not-too-distant future." George Holm, PFG's chairman, president and CEO, said in the press release.

Second-quarter EBITDA for Vistar decreased 31.6% from $56.6 billion in the prior year to $38.7 million for the quarter ending Dec. 26, 2020. A gross profit decline of 21.2% for the second quarter of fiscal 2021 compared to the prior year period was fueled by the current economic environment due to COVID-19. Operating expenses decreased primarily as a result of the decrease in sales volume, decreases in personnel and fuel expenses, and a reduction in contingent consideration accretion expense of $4.8 million as compared to the prior year period. In the second quarter of fiscal 2021,Vistar recorded bad debt expense of $1.1 million, which is a decrease of $0.5 million compared to the prior year period.

Performance Food Group's gross profit for the second quarter of fiscal 2021 grew 14.0% from $711.2 million in the prior year's second quarter to $811.1 million. The gross profit increase was led by the acquisition of Reinhart, partially offset by the current environment due to the COVID-19 pandemic.

For the second quarter of fiscal 2021, the company recorded a total of $7.0 million of inventory write-offs, which is a $1.9 million increase from the second quarter of fiscal 2020 primarily as a result of the impact of COVID-19.

Gross margin as a percentage of net sales was 11.8% for the second quarter of fiscal 2021 compared to 11.7% for the prior year period.

Net income for the second quarter of fiscal 2021 declined 57.3% year-over-year to $17.6 million, primarily a result of the $19.6 million decrease in operating profit and a $11.7 million increase in interest expense, partially offset by a $5.8 million decrease in income tax expense.

EBITDA increased 18.2% to $147.2 million in the second quarter of fiscal 2021 compared to the prior year period. For the quarter, Adjusted EBITDA rose 10.6% to $158.0 million compared to the prior year period.

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