US Foods Reports Q3 Revenue Decline
US Foods Holding Corp. posted a 10.5% revenue decrease in the third quarter of 2020, with net sales declining to $5.8 billion.
The foodservice distributor said that its organic Q3 earnings exclude contributions from Smart Stores Holding Corp., which was acquired on April 24, 2020. For the Food Group of Companies, which was acquired on Sept. 13, 2019, organic financial results include contributions for the Sept. 14 through Sept. 26 time period only.
US Foods also reported that:
- Total case volume decreased 8.9%; total organic case volume decreased 22.2%
- Gross profit decreased 15.7% to $974 million
- Net loss available to common shareholders was $2 million
- Adjusted EBITDA decreased 31.9% to $209 million
- Diluted EPS loss was $0.01; Adjusted Diluted EPS was $0.15
Nine-month fiscal 2020 highlights include:
- Total case volume decreased 11.4%; total organic case volume decreased 23.5%
- Net sales decreased 11.9% to $16.7 billion
- Gross profit decreased 19.1% to $2.7 billion
- Net loss available to common shareholders was $231 million
- Adjusted EBITDA decreased 44.8% to $474 million
- Diluted EPS loss was $1.05; Adjusted Diluted EPS was $0.05
"In the third quarter, we demonstrated the resiliency of our business model by continuing to gain market share in an industry significantly impacted by COVID-19," said Chairman and CEO Pietro Satriano. "Our case volumes continue to recover and adjusted gross profit margin improved by 70 basis points over the prior quarter. This profitable growth, along with our prudent approach to cost management, enabled us to deliver Adjusted EBITDA of $209 million for the quarter, more than double what we delivered in the second quarter. I'm proud of the hard work of all our associates, who remain focused on helping our customers Make It during this challenging time."
US Foods also said that operating expenses were $896 million, a decrease of $72 million or 7.4% from the prior year. The decrease was primarily due to actions put in place to reduce operating costs as a result of lower case volume, a $30 million reduction in the reserve for uncollectible accounts, and a $17 million gain on the sale of excess property in Southern California, which were partially offset by operating expenses for the Food Group and Smart Foodservice acquisitions.