10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 28, 2024

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _________ to _________

Commission file number: 001-35249

THE CHEFS’ WAREHOUSE, INC.

(Exact name of registrant as specified in its charter)

Delaware	20-3031526
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

100 East Ridge Road

Ridgefield, Connecticut 06877

(Address of principal executive offices)

Registrant’s telephone number, including area code: (203) 894-1345

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.01	CHEF	The NASDAQ Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes  ☒    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☒ Accelerated filer ☐ Non-accelerated filer ☐ Smaller reporting company ☐ Emerging growth company ☐

If an emerging growth company, indicate by check mark if registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes  ☐    No  ☒

Number of shares of common stock, par value $.01 per share, outstanding at July 29, 2024: 39,826,473

1

THE CHEFS’ WAREHOUSE, INC.

FORM 10-Q

Table of Contents

		Page
PART I. FINANCIAL INFORMATION
Item 1.	Condensed Consolidated Financial Statements (unaudited):	4
	Condensed Consolidated Balance Sheets	4
	Condensed Consolidated Statements of Operations and Comprehensive Income	5
	Condensed Consolidated Statements of Changes in Stockholders’ Equity	6
	Condensed Consolidated Statements of Cash Flows	8
	Notes to Condensed Consolidated Financial Statements	9
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	17
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	22
Item 4.	Controls and Procedures	22
PART II. OTHER INFORMATION
Item 1.	Legal Proceedings	22
Item 1A.	Risk Factors	22
Item 2.	Unregistered Sales of Equity Securities, Use of Proceeds and Issuer Purchases of Equity Securities	22
Item 3.	Defaults Upon Senior Securities	23
Item 4.	Mine Safety Disclosures	23
Item 5.	Other Information	23
Item 6.	Exhibits	24
Signatures		25

2

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

Statements in this report regarding the business of The Chefs’ Warehouse, Inc. (the “Company”) 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. Words such as “anticipates”, “expects”, “intends”, “plans”, “believes”, “seeks”, “estimates” and variations of these words and similar expressions are intended to identify forward-looking statements. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, some of which are beyond our control, are difficult to predict and/or could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements. The risks and uncertainties which could impact these statements include, but are not limited to the following: 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; the relatively low margins of our business, which are sensitive to inflationary and deflationary pressures and intense competition; the effects of rising costs for and/or decreases in supply of commodities, ingredients, packaging, other raw materials, distribution and labor; crude oil prices and their impact on distribution, packaging and energy costs; our continued ability to promote our brand successfully, to anticipate and respond to new customer demands, and to develop new products and markets to compete effectively; our ability and the ability of our supply chain partners to continue to operate distribution centers and other work locations without material disruption, and to procure ingredients, packaging and other raw materials when needed despite disruptions in the supply chain or labor shortages; risks associated with the expansion of our business; our possible inability to identify new acquisitions or to integrate recent or future acquisitions, or our failure to realize anticipated revenue enhancements, cost savings or other synergies from recent or future acquisitions; other factors that affect the food industry generally, including: recalls if products become adulterated or misbranded, liability if product consumption causes injury, ingredient disclosure and labeling laws and regulations and the possibility that customers could lose confidence in the safety and quality of certain food products; new information or attitudes regarding diet and health or adverse opinions about the health effects of the products we distribute; changes in disposable income levels and consumer purchasing habits; competitors’ pricing practices and promotional spending levels; fluctuations in the level of our customers’ inventories and credit and other related business risks; and the risks associated with third-party suppliers, including the risk that any failure by one or more of our third-party suppliers to comply with food safety or other laws and regulations may disrupt our supply of raw materials or certain products or injure our reputation; our ability to recruit and retain senior management and a highly skilled and diverse workforce; unanticipated expenses, including, without limitation, litigation or legal settlement expenses; the cost and adequacy of our insurance policies; the impact and effects of public health crises, pandemics and epidemics, such as the outbreak of COVID-19, and the adverse impact thereof on our business, financial condition, and results of operations; significant governmental regulation and any potential failure to comply with such regulations; federal, state, provincial and local tax rules in the United States and the foreign countries in which we operate, including tax reform and legislation; risks relating to our substantial indebtedness; our ability to raise additional capital and/or obtain debt or other financing, on commercially reasonable terms or at all; our ability to meet future cash requirements, including the ability to access financial markets effectively and maintain sufficient liquidity; the effects of currency movements in the jurisdictions in which we operate as compared to the U.S. dollar; the effects of international trade disputes, tariffs, quotas and other import or export restrictions on our international procurement, sales and operations; other factors discussed elsewhere in this report, including Part I, Item 1A of this Form 10-K and in our other public filings with the SEC.

Any forward-looking statements are made pursuant to the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, 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 February 27, 2024 and other reports, including this Quarterly Report on Form 10-Q, filed by the Company with the SEC since that date. The Company is not undertaking to update any information in the foregoing reports until the filing or effective dates of its future reports required by applicable laws.

3

PART I FINANCIAL INFORMATION

ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

THE CHEFS’ WAREHOUSE, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

 (Unaudited)

(Amounts in thousands, except share data)

	June 28, 2024		December 29, 2023
ASSETS
Current assets:
Cash and cash equivalents	$	38,340	$	49,878
Accounts receivable, net of allowances ($22,493 in 2024, $21,423 in 2023)	323,433		334,015
Inventories	310,355		284,528
Prepaid expenses and other current assets	68,421		62,522
Total current assets	740,549		730,943
Property and equipment, net	259,585		234,793
Operating lease right-of-use assets	179,813		192,307
Goodwill	356,531		356,021
Intangible assets, net	172,461		184,863
Other assets	6,482		6,379
Total assets	$	1,715,421	$	1,705,306
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	220,391	$	200,547
Accrued liabilities	61,761		70,728
Short-term operating lease liabilities	23,502		24,246
Accrued compensation	37,254		37,071
Current portion of long-term debt	56,626		53,185
Total current liabilities	399,534		385,777
Long-term debt, net of current portion	660,759		664,802
Operating lease liabilities	173,042		184,034
Deferred taxes, net	17,413		14,418
Other liabilities	2,794		1,603
Total liabilities	1,253,542		1,250,634
Commitments and contingencies
Stockholders’ equity:
Preferred Stock - $0.01 par value, 5,000,000 shares authorized, no shares issued and outstanding at June 28, 2024 and December 29, 2023, respectively	—		—
Common Stock - $0.01 par value, 100,000,000 shares authorized, 39,805,717 and 39,665,796 shares issued and outstanding at June 28, 2024 and December 29, 2023, respectively	398		396
Additional paid-in capital	356,363		356,157
Accumulated other comprehensive loss	(2,284)		(1,832)
Retained earnings	117,406		99,951
Treasury stock	(10,004)		—
Total stockholders’ equity	461,879		454,672
Total liabilities and stockholders’ equity	$	1,715,421	$	1,705,306

See accompanying notes to the condensed consolidated financial statements.

4

THE CHEFS’ WAREHOUSE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

(Unaudited)

(Amounts in thousands, except share and per share amounts)

	Thirteen Weeks Ended				Twenty-Six Weeks Ended
	June 28, 2024		June 30, 2023		June 28, 2024		June 30, 2023
Net sales	$	954,704	$	881,820	$	1,829,192	$	1,601,465
Cost of sales	725,702		673,376		1,390,754		1,223,313
Gross profit	229,002		208,444		438,438		378,152
Selling, general and administrative expenses	194,834		179,042		385,155		335,179
Other operating expenses, net	301		4,062		3,413		5,734
Operating income	33,867		25,340		49,870		37,239
Interest expense	11,690		12,006		24,934		22,012
Income before income taxes	22,177		13,334		24,936		15,227
Provision for income tax expense	6,653		3,467		7,481		3,959
Net income	$	15,524	$	9,867	$	17,455	$	11,268
Other comprehensive (loss) income:
Foreign currency translation adjustments	(129)		193		(452)		274
Comprehensive income	$	15,395	$	10,060	$	17,003	$	11,542
Net income per share:
Basic	$	0.41	$	0.26	$	0.46	$	0.30
Diluted	$	0.37	$	0.25	$	0.44	$	0.29
Weighted average common shares outstanding:
Basic	37,924,931		37,634,127		37,871,080		37,570,595
Diluted	45,947,728		45,604,297		45,959,061		38,201,408

See accompanying notes to the condensed consolidated financial statements.

5

THE CHEFS’ WAREHOUSE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

(Unaudited)

(Amounts in thousands, except share amounts)

	Common Stock			Additional Paid-in Capital		Accumulated Other Comprehensive Loss		Retained Earnings		Treasury Stock			Total
	Shares	Amount								Shares	Amount
Balance December 29, 2023	39,665,796	$	396	$	356,157	$	(1,832)	$	99,951	—	$	—	$	454,672
Net income	—	—		—		—		1,931		—	—		1,931
Stock compensation	—	—		3,590		—		—		—	—		3,590
Common stock repurchased	—	—		—		—		—		(134,553)	(5,004)		(5,004)
Warrants exercised	32,454	1		(1)		—		—		—	—		—
Cumulative translation adjustment	—	—		—		(323)		—		—	—		(323)
Common stock issued under stock plans, net of shares surrendered to pay tax withholding	75,105	1		(7,074)		—		—		—	—		(7,073)
Balance March 29, 2024	39,773,355	$	398	$	352,672	$	(2,155)	$	101,882	(134,553)	$	(5,004)	$	447,793
Net income	—	—		—		—		15,524		—	—		15,524
Stock compensation	—	—		3,946		—		—		—	—		3,946
Common stock repurchased	—	—		—		—		—		(129,523)	(5,000)		(5,000)
Warrants exercised	1,850	—		—		—		—		—	—		—
Cumulative translation adjustment	—	—		—		(129)		—		—	—		(129)
Common stock issued under stock plans, net of shares surrendered to pay tax withholding	30,512	—		(255)		—		—		—	—		(255)
Balance June 28, 2024	39,805,717	$	398	$	356,363	$	(2,284)	$	117,406	(264,076)	$	(10,004)	$	461,879

6

THE CHEFS’ WAREHOUSE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (continued)

(Unaudited)

(Amounts in thousands, except share amounts)

	Common Stock			Additional Paid-in Capital		Accumulated Other Comprehensive Loss		Retained Earnings		Treasury Stock				Total
	Shares	Amount								Shares		Amount
Balance December 30, 2022	38,599,390	$	386	$	337,947	$	(2,185)	$	65,361	—		$	—	$	401,509
Net income	—	—		—		—		1,401		—		—		1,401
Stock compensation	—	—		4,780		—		—		—		—		4,780
Cumulative translation adjustment	—	—		—		81		—		—		—		81
Common stock issued under stock plans, net of shares surrendered to pay tax withholding	944,741	9		(1,828)		—		—		—		—		(1,819)
Balance March 31, 2023	39,544,131	$	395	$	340,899	$	(2,104)	$	66,762	$	—	$	—	$	405,952
Net income	—	—		—		—		9,867		—		—		9,867
Stock compensation	—	—		4,704		—		—		—		—		4,704
Shares issued for acquisition	75,008	1		2,495		—		—		—		—		2,496
Cumulative translation adjustment	—	—		—		193		—		—		—		193
Common stock issued under stock plans, net of shares surrendered to pay tax withholding	46,552	—		(237)		—		—		—		—		(237)
Balance June 30, 2023	39,665,691	$	396	$	347,861	$	(1,911)	$	76,629	$	—	$	—	$	422,975

See accompanying notes to the condensed consolidated financial statements.

7

THE CHEFS’ WAREHOUSE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(Amounts in thousands)

	Twenty-Six Weeks Ended
	June 28, 2024		June 30, 2023
Cash flows from operating activities:
Net income	$	17,455	$	11,268
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	18,771		15,682
Amortization of intangible assets	12,342		10,456
Provision for allowance for doubtful accounts	6,097		3,311
Provision for deferred income taxes	3,003		990
Loss on debt extinguishment	366		—
Stock compensation	8,754		10,581
Change in fair value of contingent earn-out liabilities	(615)		1,092
Intangible asset impairment	—		1,838
Non-cash interest and other operating activities	2,747		3,647
Changes in assets and liabilities, net of acquisitions:
Accounts receivable	4,269		(9,854)
Inventories	(25,431)		(35,450)
Prepaid expenses and other current assets	(3,368)		(2,435)
Accounts payable, accrued liabilities and accrued compensation	17,812		453
Other assets and liabilities	(1,976)		(796)
Net cash provided by operating activities	60,226		10,783
Cash flows from investing activities:
Capital expenditures	(33,123)		(23,155)
Cash paid for acquisitions, net of cash acquired	(315)		(119,580)
Net cash used in investing activities	(33,438)		(142,735)
Cash flows from financing activities:
Payment of debt and other financing obligations	(14,500)		(10,238)
Payment of finance leases	(3,839)		(1,442)
Common stock repurchases	(10,004)		—
Surrender of shares to pay withholding taxes	(7,283)		(2,115)
Cash paid for contingent earn-out liability	(3,550)		(3,210)
Borrowings under asset-based loan facility and revolving credit facilities	813		50,000
Net cash (used in) provided by financing activities	(38,363)		32,995
Effect of foreign currency on cash and cash equivalents	37		(251)
Net change in cash and cash equivalents	(11,538)		(99,208)
Cash and cash equivalents-beginning of period	49,878		158,800
Cash and cash equivalents-end of period	$	38,340	$	59,592

See accompanying notes to the condensed consolidated financial statements.

8

THE CHEFS’ WAREHOUSE, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(Amounts in thousands, except share and per share amounts)

Note 1 - Operations and Basis of Presentation

Description of Business and Basis of Presentation

The Chefs’ Warehouse, Inc. (the “Company”), and its wholly-owned subsidiaries, is a premier distributor of specialty food and center-of-the-plate products in the United States, the Middle East and Canada. The Company is 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 Company’s quarterly periods end on the thirteenth Friday of each quarter. Every six to seven years, the Company will add a fourteenth week to its fourth quarter to more closely align its year-end to the calendar year. The Company’s business consists of three operating segments: East, Midwest and West that aggregate into one reportable segment, foodservice distribution, which is concentrated primarily in the United States.

Consolidation

The unaudited condensed consolidated financial statements include all the accounts of the Company and its direct and indirect wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated.

Unaudited Interim Financial Statements

The accompanying unaudited condensed consolidated financial statements and the related interim information contained within the notes to such unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and the applicable rules of the Securities and Exchange Commission (“SEC”) for interim information and quarterly reports on Form 10-Q. Accordingly, they do not include all the information and disclosures required by GAAP for complete financial statements. These unaudited condensed consolidated financial statements and related notes should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto for the fiscal year ended December 29, 2023 filed as part of the Company’s Annual Report on Form 10-K (the “2023 Form 10-K”).

The unaudited condensed consolidated financial statements appearing in this Form 10-Q have been prepared on the same basis as the audited consolidated financial statements included in the Company’s 2023 Form 10-K, and in the opinion of management, include all normal recurring adjustments that are necessary for the fair statement of the Company’s interim period results. The year-end consolidated balance sheet data was derived from the audited financial statements but does not include all disclosures required by GAAP. Due to seasonal fluctuations and other factors, the results of operations for the thirteen and twenty-six weeks ended June 28, 2024 are not necessarily indicative of the results to be expected for the full year.

The preparation of financial statements in conformity with GAAP requires management to make significant estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from management’s estimates.

9

Note 2 – Summary of Significant Accounting Policies

Revenue Recognition

The following table presents the Company’s net sales disaggregated by principal product category:

	Thirteen Weeks Ended								Twenty-Six Weeks Ended
	June 28, 2024				June 30, 2023				June 28, 2024				June 30, 2023
Center-of-the-Plate	$	365,387	38.3	%	$	338,390	38.4	%	$	708,323	38.7	%	$	646,311	40.4	%
Specialty:
Dry Goods	154,575		16.2	%	137,985		15.6	%	293,385		16.0	%	261,325		16.3	%
Produce	136,295		14.3	%	124,766		14.1	%	262,420		14.3	%	172,553		10.8	%
Pastry	114,224		12.0	%	108,143		12.3	%	216,092		11.8	%	198,252		12.4	%
Cheese and Charcuterie	68,820		7.2	%	64,947		7.4	%	128,119		7.0	%	120,664		7.5	%
Dairy and Eggs	62,674		6.6	%	56,678		6.4	%	120,800		6.6	%	106,751		6.7	%
Oils and Vinegars	33,811		3.5	%	33,131		3.8	%	63,617		3.5	%	62,510		3.9	%
Kitchen Supplies	18,918		1.9	%	17,780		2.0	%	36,436		2.1	%	33,099		2.0	%
Total Specialty	$	589,317	61.7	%	$	543,430	61.6	%	$	1,120,869	61.3	%	$	955,154	59.6	%
Total net sales	$	954,704	100	%	$	881,820	100	%	$	1,829,192	100	%	$	1,601,465	100	%

The Company determines its product category classification based on how the Company currently markets its products to its customers. The Company’s definition of its principal product categories may differ from the way in which other companies present similar information. Net sales by product category includes estimates of product mix for certain locations that are not yet fully integrated into the Company’s information technology systems as of the reporting date. Prior period product category amounts have been reclassified to conform to the current period’s presentation.

Food Processing Costs

Food processing costs include, but are not limited to, direct labor and benefits, applicable overhead and depreciation of equipment and facilities used in food processing activities. Food processing costs included in cost of sales were $18,277 and $16,615 for the thirteen weeks ended June 28, 2024 and June 30, 2023, respectively, and $37,347 and $28,289 for the twenty-six weeks ended June 28, 2024 and June 30, 2023, respectively.

Share Repurchases

The Company has a share repurchase program that is executed through purchases made from time to time either in the open market or through private market transactions. Shares purchased under the program are recorded at cost and held as treasury stock.

Guidance Not Yet Adopted

Improvements to Income Tax Disclosures: In December 2023, the Financial Accounting Standards Board (“FASB”) issued guidance designed to improve the transparency and usefulness of income tax disclosures. The amendments include provisions to address the consistency of the income tax rate reconciliation and requirement to disaggregate income taxes paid by jurisdiction. The guidance is effective for fiscal years beginning after December 15, 2024. Early adoption is permitted. The Company expects to adopt this guidance when effective and is evaluating the impact of adoption on its consolidated financial statements, which is limited to financial statement disclosures.

Improvements to Reportable Segment Disclosures: In November 2023, the FASB issued guidance which requires entities, including those with one reportable segment, to enhance reportable segment disclosures requirements particularly with respect to significant expenses. The guidance is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024 on a retrospective basis. Early adoption is permitted. The Company expects to adopt this guidance when effective and is evaluating the impact of adoption on its consolidated financial statements, which is limited to financial statement disclosures.

10

Note 3 – Net Income per Share

Basic net income per share is calculated by dividing net income by the weighted average number of shares of common stock outstanding during the period. Diluted net income per share adjusts basic net income per share for all the potentially dilutive shares outstanding during the period.

The following table sets forth the computation of basic and diluted net income per common share:

	Thirteen Weeks Ended				Twenty-Six Weeks Ended
	June 28, 2024		June 30, 2023		June 28, 2024		June 30, 2023
Net income per share:
Basic	$	0.41	$	0.26	$	0.46	$	0.30
Diluted	$	0.37	$	0.25	$	0.44	$	0.29
Weighted average common shares:
Basic	37,924,931		37,634,127		37,871,080		37,570,595
Diluted	45,947,728		45,604,297		45,959,061		38,201,408

Reconciliation of net income per common share:

	Thirteen Weeks Ended				Twenty-Six Weeks Ended
	June 28, 2024		June 30, 2023		June 28, 2024		June 30, 2023
Numerator:
Net income	$	15,524	$	9,867	$	17,455	$	11,268
Add effect of dilutive securities
Interest on convertible notes, net of tax	1,322		1,397		2,628		—
Net income available to common shareholders	$	16,846	$	11,264	$	20,083	$	11,268
Denominator:
Weighted average basic common shares outstanding	37,924,931		37,634,127		37,871,080		37,570,595
Dilutive effect of unvested common shares	573,930		521,102		642,767		564,119
Dilutive effect of stock options and warrants	56,050		56,251		52,397		66,694
Dilutive effect of convertible notes	7,392,817		7,392,817		7,392,817		—
Weighted average diluted common shares outstanding	45,947,728		45,604,297		45,959,061		38,201,408

Potentially dilutive securities that have been excluded from the calculation of diluted net income per common share because the effect is anti-dilutive are as follows:

	Thirteen Weeks Ended		Twenty-Six Weeks Ended
	June 28, 2024	June 30, 2023	June 28, 2024	June 30, 2023
Restricted share awards (“RSAs”) and restricted stock units (“RSUs”)	160,273	46,746	286,769	29,717
Convertible notes	—	—	—	7,392,817

11

Note 4 – Fair Value Measurements

Assets and Liabilities Measured at Fair Value

The Company’s contingent earn-out liabilities are measured at fair value. These liabilities were estimated using Level 3 inputs. The fair value of contingent consideration was predominantly determined based on a probability-based approach which includes projected results, percentage probability of occurrence and the application of a discount rate to present value the payments. A significant change in projected results, discount rate, or probabilities of occurrence could result in a significantly higher or lower fair value measurement. Changes in the fair value of contingent earn-out liabilities are reflected in other operating expenses, net on the condensed consolidated statements of operations.

The following table presents the changes in Level 3 contingent earn-out liabilities:

	Total
Balance December 29, 2023	$	9,765
Cash payments	(4,250)
Changes in fair value	(615)
Balance June 28, 2024	$	4,900

The long-term portion of contingent earn-out liabilities were $637 and $50 as of June 28, 2024 and December 29, 2023, respectively, and are reflected as other liabilities on the Company’s condensed consolidated balance sheets. The remaining short-term portion of earn-out liabilities are reflected as accrued liabilities on the Company’s condensed consolidated balance sheets.

Fair Value of Financial Instruments

The carrying amounts reported in the Company’s condensed consolidated balance sheets for accounts receivable and accounts payable approximate fair value due to their immediate to short-term nature. The fair values of the asset-based loan facility and term loan approximated their book values as of June 28, 2024 and December 29, 2023, as these instruments had variable interest rates that reflected current market rates available to the Company and are classified as Level 2 fair value measurements.

The following table presents the carrying value and fair value of the Company’s convertible notes and its unsecured note issued in connection with the acquisition of Oakville Produce Partners, LLC (“GreenLeaf”) in fiscal 2023 (“GreenLeaf Note”). The fair value of the Company’s 2028 Convertible Senior Notes was based on Level 1 inputs. In estimating the fair value of its 2024 Convertible Senior Notes, the Company utilized Level 3 inputs including prevailing market interest rates to estimate the debt portion of the instrument and a Black Scholes valuation model to estimate the fair value of the conversion option. The Black Scholes model utilizes the market price of the Company’s common stock, estimates of the stock’s volatility and the prevailing risk-free interest rate in calculating the fair value estimate. The fair value of the GreenLeaf Note was determined based upon observable market prices of similar debt instruments.

		June 28, 2024				December 29, 2023
	Fair Value Hierarchy	Carrying Value		Fair Value		Carrying Value		Fair Value
2028 Convertible Senior Notes	Level 1	$	287,500	$	318,047	$	287,500	$	277,354
2024 Convertible Senior Notes	Level 3	$	39,684	$	40,300	$	39,684	$	38,609
GreenLeaf Note	Level 2	$	5,000	$	4,888	$	10,000	$	9,991

Note 5 – Acquisitions

The Company paid approximately $315 during the twenty-six weeks ended June 28, 2024 upon settlement of net working capital true-ups on prior year acquisitions, resulting in measurement period adjustments which increased goodwill by $656 and reduced prepaid expenses and other current assets by $341.

The Company recognized professional fees related to acquisition activities of $1,385 and $2,628 during the thirteen and twenty-six weeks ended June 30, 2023, respectively, presented within other operating expenses, net on the condensed consolidated

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statements of operations. There were no professional fees related to acquisition activities recorded during the thirteen and twenty-six weeks ended June 28, 2024.

Unaudited Pro forma Financial Information

The table below presents unaudited pro forma condensed consolidated income statement information of the Company as if the GreenLeaf and Hardie’s Fresh Foods acquisitions had occurred on December 30, 2022. The pro forma results were prepared from financial information obtained from the sellers of the business, as well as information obtained during the due diligence process associated with the acquisitions. The pro forma information is not necessarily indicative of the Company’s results of operations had the acquisitions been completed on the above date, nor is it necessarily indicative of the Company’s future results. The pro forma information does not reflect any cost savings from operating efficiencies or synergies that could result from the acquisitions, any incremental costs for transitioning to become a public company, and also does not reflect additional revenue opportunities following the acquisitions. The pro forma information reflects amortization expense related to the acquired intangible assets and depreciation expense on the acquired fair value of property and equipment. The pro forma information also reflects additional interest expense that would have been incurred by the Company to finance the acquisitions. Pro forma interest expense was estimated based on the prevailing interest rates charged on the Company’s senior secured term loan during fiscal 2022.

	Thirteen Weeks Ended			Twenty-Six Weeks Ended
		June 30, 2023			June 30, 2023
Net sales		$	892,161		$	1,695,649
Income before income taxes		$	13,617		$	16,752

Note 6 – Inventories

Inventories consist primarily of finished product and are reflected net of adjustments for shrinkage, excess and obsolescence to approximate their net realizable value totaling $12,157 and $11,205 at June 28, 2024 and December 29, 2023, respectively.

Note 7 – Property and Equipment

Property and equipment is net of accumulated depreciation and amortization of $154,745 and $137,008 at June 28, 2024 and December 29, 2023, respectively.

Note 8 – Goodwill and Other Intangible Assets

The changes in the carrying amount of goodwill are presented as follows:

Carrying amount as of December 29, 2023	$	356,021
Goodwill adjustments	656
Foreign currency translation	(146)
Carrying amount as of June 28, 2024	$	356,531

The goodwill adjustments included in the table above represent measurement period adjustments related to certain acquisitions completed in the prior year.

Other intangible assets are net of accumulated amortization of $145,002 and $132,660 as of June 28, 2024 and December 29, 2023, respectively. Amortization expense for other intangibles was $6,171 and $5,759 for the thirteen weeks ended June 28, 2024 and June 30, 2023, respectively, and $12,342 and $10,456 for the twenty-six weeks ended June 28, 2024 and June 30, 2023, respectively.

The Company recognized a customer relationships intangible asset impairment charge of $1,838, $1,333 net of tax, during the thirteen and twenty-six weeks ended June 30, 2023 related to the loss of a significant Hardie’s Fresh Foods customer post-acquisition.

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Note 9 – Debt Obligations

Debt obligations as of June 28, 2024 and December 29, 2023 consisted of the following:

	Weighted Average Effective Interest Rate at June 28, 2024		Maturity	June 28, 2024		December 29, 2023
Senior secured term loans	10.10	%	August 2029	$	266,750	$	276,250
2028 Convertible senior notes	2.77	%	December 2028	287,500		287,500
2024 Convertible senior notes	2.34	%	December 2024	39,684		39,684
Asset-based loan facility	7.47	%	March 2027	100,000		100,000
Finance leases and other financing obligations	6.48	%	Various	38,558		31,892
Unamortized deferred costs and premium				(15,107)		(17,339)
Total debt obligations				717,385		717,987
Less: current installments				(56,626)		(53,185)
Total long-term debt				$	660,759	$	664,802

Senior Secured Term Loan Credit Facility

In March 2024, the Company entered into an eleventh amendment (“Eleventh Amendment”) to its senior secured term loan agreement, which reduced the interest rate spread on its senior secured term loan facility. As a result of this amendment, the Company incurred a loss on debt extinguishment of $50 during the twenty-six weeks ended June 28, 2024, which represents the portion of unamortized deferred financing fees attributable to the lender that exited the loan syndicate. Arrangement fees of $775 and third-party transaction costs of $91 were expensed as incurred during the twenty-six weeks ended June 28, 2024 and included in interest expense and other operating expenses, respectively, within the Company’s condensed consolidated statements of operations.

Additionally, during the twenty-six weeks ended June 28, 2024, the Company made voluntary principal prepayments totaling $8,000 towards the senior secured term loan. In connection with the prepayments, the Company wrote-off unamortized deferred financing fees of $77 and $316 during the thirteen and twenty-six weeks ended June 28, 2024, respectively, which were included in interest expense within the Company’s condensed consolidated statements of operations.

GreenLeaf Unsecured Note

During the twenty-six weeks ended June 28, 2024, the Company made a scheduled principal payment of $5,000 towards the GreenLeaf Note. The GreenLeaf Note is presented under the caption “Finance leases and other financing obligations” in the table above.

Convertible Notes

The net carrying value of the Company’s convertible senior notes as of June 28, 2024 and December 29, 2023 was:

	June 28, 2024						December 29, 2023
	Principal Amount		Unamortized Deferred Costs and Premium		Net Amount		Principal Amount		Unamortized Deferred Costs and Premium		Net Amount
2028 Notes	$	287,500	$	(5,157)	$	282,343	$	287,500	$	(5,730)	$	281,770
2024 Notes	39,684		(93)		39,591		39,684		(185)		39,499
Total	$	327,184	$	(5,250)	$	321,934	$	327,184	$	(5,915)	$	321,269

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The components of interest expense on the Company’s convertible notes were as follows:

	Thirteen Weeks Ended				Twenty-Six Weeks Ended
	June 28, 2024		June 30, 2023		June 28, 2024		June 30, 2023
Coupon interest	$	1,893	$	1,893	$	3,786	$	3,792
Amortization of deferred costs and premium	333		333		666		668
Total interest	$	2,226	$	2,226	$	4,452	$	4,460

As of June 28, 2024, the Company had reserved $29,377 of its asset-based loan facility for the issuance of letters of credit and funds totaling $170,623 were available for borrowing.

Note 10 – Stockholders’ Equity

Equity Awards

The following table reflects the activity of RSAs and RSUs during the twenty-six weeks ended June 28, 2024:

	Time-based			Performance-based			Market-based
	Shares	Weighted Average Grant Date Fair Value		Shares	Weighted Average Grant Date Fair Value		Shares	Weighted Average Grant Date Fair Value
Unvested at December 29, 2023	461,752	$	32.13	1,078,169	$	32.88	421,056	$	30.00
Granted	248,934	37.86		313,188	38.53		55,270	34.68
Vested	(223,099)	31.80		(172,232)	32.07		(166,343)	31.43
Forfeited	(5,650)	34.03		(325,267)	33.48		(3,956)	31.00
Unvested at June 28, 2024	481,937	$	35.21	893,858	$	34.80	306,027	$	30.06

The Company granted 617,392 RSAs and RSUs to its employees and directors at a weighted average grant date fair value of $37.91 during the twenty-six weeks ended June 28, 2024. These awards are a mix of time-, market- and performance-based grants that generally vest over a range of periods up to 5 years. The Company recognized expense on its RSAs and RSUs totaling $3,946 and $4,704 during the thirteen weeks ended June 28, 2024 and June 30, 2023, respectively, and $7,536 and $9,494 during the twenty-six weeks ended June 28, 2024 and June 30, 2023, respectively.

At June 28, 2024, the total unrecognized compensation cost for unvested RSAs and RSUs was $27,702 and the weighted-average remaining period was approximately 1.8 years. Of this total, $14,525 related to awards with time-based vesting provisions and $13,177 related to awards with performance- and market-based vesting provisions. At June 28, 2024, the weighted-average remaining period for time-based vesting and performance-based vesting RSAs and RSUs were approximately 1.7 years and 2.0 years, respectively.

No share-based compensation expense has been capitalized.

Share Repurchase Program

In November 2023, the Company announced a two-year share repurchase program in an amount up to $100,000, targeting $25,000 to $100,000 of share repurchases by the end of fiscal 2025. The remaining share purchase authorization was $90,000 at June 28, 2024. The Company is not obligated to repurchase any specific number of shares and may suspend or discontinue the program at any time.

Note 11 – Related Parties

The Chefs’ Warehouse Mid-Atlantic, LLC, a subsidiary of the Company, leases a distribution facility that is 100% owned by entities controlled by Christopher Pappas, the Company’s Chairman, President and Chief Executive Officer, and John Pappas, the Company’s Vice Chairman and Chief Operating Officer, and are deemed to be affiliates of these individuals. Expense related to this facility totaled $176 and $123 during the thirteen weeks ended June 28, 2024 and June 30, 2023, respectively, and $352 and $246 during the twenty-six weeks ended June 28, 2024 and June 30, 2023, respectively.

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Note 12 – Income Taxes

The Company’s effective tax rate was 30.0% and 26.0% for the thirteen weeks ended June 28, 2024 and June 30, 2023, respectively, and 30.0% and 26.0% for the twenty-six weeks ended June 28, 2024 and June 30, 2023, respectively. The higher effective tax rate for the thirteen and twenty-six weeks ended June 28, 2024 is primarily due to the non-deductibility of certain compensation-related items. The effective tax rate otherwise varies from the 21% statutory rate primarily due to state taxes.

The Company’s income tax provision reflects the impact of an expected income tax refund receivable of $25,244 as of June 28, 2024, which is reflected in prepaid expenses and other current assets on the Company’s condensed consolidated balance sheet.

The Organization for Economic Co-operation and Development (the “OECD”) introduced a framework under Pillar Two which includes a global corporate minimum tax rate of 15%. Some jurisdictions in which the Company operates have started to enact laws implementing Pillar Two. The Company is monitoring these developments and currently does not believe the rules effective in fiscal 2024 will have a material impact on its consolidated financial statements.

Note 13 – Supplemental Disclosures of Cash Flow Information

	Twenty-Six Weeks Ended
	June 28, 2024		June 30, 2023
Supplemental cash flow disclosures:
Cash paid for income taxes	$	6,016	$	10,673
Cash paid for interest, net of cash received	$	23,302	$	20,266
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	19,371	$	18,591
Operating cash flows from finance leases	$	895	$	336
ROU assets obtained in exchange for lease liabilities:
Operating leases	$	1,797	$	42,182
Finance leases	$	13,894	$	3,684
Non-cash investing and financing activities:
Common stock issued for acquisitions	$	—	$	2,496
Unsecured notes issued for acquisitions	$	—	$	10,000
Contingent earn-out liabilities for acquisitions	$	—	$	5,835

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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND

RESULTS OF OPERATIONS

Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is provided as a supplement to the accompanying condensed consolidated financial statements and footnotes to help provide an understanding of our financial condition, changes in our financial condition and results of operations. The following discussion should be read in conjunction with information included in our Annual Report on Form 10-K for the fiscal year ended December 29, 2023 (the “2023 Form 10-K”) filed with the SEC. Unless otherwise indicated, the terms “Company”, “Chefs’ Warehouse”, “we”, “us” and “our” refer to The Chefs’ Warehouse, Inc. and its subsidiaries.

Business Overview

We are a premier distributor of specialty foods in the leading culinary markets in the United States, the Middle East and Canada. We offer more than 70,000 stock-keeping units (“SKUs”), ranging from high-quality specialty foods and ingredients to basic ingredients and staples and center-of-the-plate proteins. We serve more than 44,000 core customer locations, primarily located in our 23 geographic markets across the United States, the Middle East and Canada, and the majority of our customers are independent restaurants and fine dining establishments. We also sell certain of our products directly to consumers through our Allen Brothers retail channel.

Acquisitions

On May 1, 2023, the Company entered into a stock purchase agreement to acquire substantially all of the equity interests of Oakville Produce Partners, LLC (“GreenLeaf”), a leading produce and specialty food distributor in Northern California. The final purchase price was $88.2 million consisting of $72.2 million paid in cash at closing, $3.5 million paid upon settlement of a net working capital true-up, the issuance of a $10.0 million unsecured note, and 75,008 shares of the Company’s common stock with an approximate value of $2.5 million based on the trading price of the Company’s common stock on the date of acquisition.

On March 20, 2023, pursuant to an asset purchase agreement, we acquired substantially all of the assets of Hardie’s F&V, LLC (“Hardie’s Fresh Foods”), a specialty produce distributor with operations in Texas. The final purchase price was approximately $41.4 million, consisting of $38.0 million paid in cash at closing, $0.6 million received upon settlement of a net working capital true-up, and an earn-out liability valued at approximately $4.0 million as of the acquisition date. If earned, the earn-out liability could total up to $10.0 million over a two-year period.

RESULTS OF OPERATIONS

	Thirteen Weeks Ended				Twenty-Six Weeks Ended
(in thousands)	June 28, 2024		June 30, 2023		June 28, 2024		June 30, 2023
Net sales	$	954,704	$	881,820	$	1,829,192	$	1,601,465
Cost of sales	725,702		673,376		1,390,754		1,223,313
Gross profit	229,002		208,444		438,438		378,152
Selling, general and administrative expenses	194,834		179,042		385,155		335,179
Other operating expenses, net	301		4,062		3,413		5,734
Operating income	33,867		25,340		49,870		37,239
Interest expense	11,690		12,006		24,934		22,012
Income before income taxes	22,177		13,334		24,936		15,227
Provision for income tax expense	6,653		3,467		7,481		3,959
Net income	$	15,524	$	9,867	$	17,455	$	11,268

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Thirteen Weeks Ended June 28, 2024 Compared to Thirteen Weeks Ended June 30, 2023

Net Sales

	2024		2023		$ Change		% Change
Net sales	$	954,704	$	881,820	$	72,884	8.3	%

Organic growth contributed $62.8 million, or 7.2%, to sales growth and the remaining sales growth of $10.1 million, or 1.1%, resulted from acquisitions. Organic case count increased approximately 4.7% in our specialty category. In addition, specialty unique customers and placements increased 8.2% and 11.3%, respectively, compared to the prior year period. Organic pounds sold in our center-of-the-plate category increased 2.9% compared to the prior year. Estimated inflation was 2.7% in our specialty category and 4.3% in our center-of-the-plate category compared to the prior year period.

Gross Profit

	2024			2023			$ Change		% Change
Gross profit	$	229,002		$	208,444		$	20,558	9.9	%
Gross profit margin	24.0		%	23.6		%

Gross profit dollars increased primarily as a result of increased sales and price inflation. Gross profit margin increased approximately 35 basis points. Gross profit margins increased 50 basis points in the Company’s specialty category and were relatively unchanged in the Company’s center-of-the-plate category.

Selling, General and Administrative Expenses

	2024			2023			$ Change		% Change
Selling, general and administrative expenses	$	194,834		$	179,042		$	15,792	8.8	%
Percentage of net sales	20.4		%	20.3		%

The increase in selling, general and administrative expenses was primarily due to higher depreciation and amortization expenses driven by acquisitions and facility investments, and higher costs associated with compensation and benefits, facilities and distribution to support sales growth. Our ratio of selling, general and administrative expenses to net sales increased 10 basis points due to increased near-term costs associated with our investments in facilities and acquisitions.

Other Operating Expenses, Net

	2024		2023		$ Change		% Change
Other operating expenses, net	$	301	$	4,062	$	(3,761)	(92.6)	%

Other operating expenses, net decreased by $3.8 million primarily due to an impairment charge on customer relationships intangible assets of $1.8 million recorded during the thirteen weeks ended June 30, 2023 related to the loss of a significant Hardie’s Fresh Foods customer post-acquisition and lower third-party deal costs incurred in connection with business acquisitions and financing arrangements during the thirteen weeks ended June 28, 2024 compared to the prior year quarter.

Interest Expense

	2024		2023		$ Change		% Change
Interest expense	$	11,690	$	12,006	$	(316)	(2.6)	%

Interest expense decreased primarily due to lower principal amounts outstanding on the senior secured term loans in 2024.

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Provision for Income Tax Expense

	2024			2023			$ Change		% Change
Provision for income tax expense	$	6,653		$	3,467		$	3,186	91.9	%
Effective tax rate	30.0		%	26.0		%

The higher effective tax rate for the thirteen weeks ended June 28, 2024 was primarily driven by the non-deductibility of certain compensation-related items.

Twenty-Six Weeks Ended June 28, 2024 Compared to Twenty-Six Weeks Ended June 30, 2023

Net Sales

	2024		2023		$ Change		% Change
Net sales	$	1,829,192	$	1,601,465	$	227,727	14.2	%

Organic growth contributed $126.2 million, or 7.9%, to sales growth and the remaining sales growth of $101.6 million, or 6.3%, resulted from acquisitions. Organic case count increased approximately 4.7% in our specialty category. In addition, specialty unique customers and placements increased 9.1% and 11.6%, respectively, compared to the prior year period. Organic pounds sold in our center-of-the-plate category increased 4.5% compared to the prior year. Estimated inflation was 2.1% in our specialty category and 4.5% in our center-of-the-plate category compared to the prior year period.

Gross Profit

	2024			2023			$ Change		% Change
Gross profit	$	438,438		$	378,152		$	60,286	15.9	%
Gross profit margin	24.0		%	23.6		%

Gross profit dollars increased primarily as a result of sales growth and price inflation. Gross profit margin increased approximately 36 basis points. Gross profit margins increased 27 basis points in the Company’s specialty category and increased 7 basis points in the Company’s center-of-the-plate category.

Selling, General and Administrative Expenses

	2024			2023			$ Change		% Change
Selling, general and administrative expenses	$	385,155		$	335,179		$	49,976	14.9	%
Percentage of net sales	21.1		%	20.9		%

The increase in selling, general and administrative expenses was primarily due to higher depreciation and amortization expenses, driven by acquisitions and facility investments, and higher costs associated with compensation and benefits, facilities and distribution to support sales growth. Our ratio of selling, general and administrative expenses to net sales increased by 20 basis points due to increased near-term costs associated with our investments in facilities and acquisitions.

Other Operating Expenses, Net

	2024		2023		$ Change		% Change
Other operating expenses, net	$	3,413	$	5,734	$	(2,321)	(40.5)	%

The decrease in net other operating expense relates primarily to an impairment charge on customer relationships intangible assets of $1.8 million recorded during the twenty-six weeks ended June 30, 2023 related to the loss of a significant Hardie’s Fresh Foods customer post-acquisition, non-cash credits of $0.6 million for changes in the fair value of our contingent earn-out liabilities in the current period compared to non-cash charges of $1.1 million in the prior year period and lower third-party deal costs incurred in connection with business acquisitions and financing arrangements during the twenty-six weeks ended June 28, 2024, partially offset by charges associated with employee severance in the first quarter of 2024.

Interest Expense

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	2024		2023		$ Change		% Change
Interest expense	$	24,934	$	22,012	$	2,922	13.3	%

Interest expense increased primarily driven by higher average principal amounts of outstanding debt during the period and higher rates of interest charged on the variable rate portion of our outstanding debt.

Provision for Income Taxes

	2024			2023			$ Change		% Change
Provision for income tax expense	$	7,481		$	3,959		$	3,522	89.0	%
Effective tax rate	30.0		%	26.0		%

The higher effective tax rate for the twenty-six weeks ended June 28, 2024 was primarily driven by the non-deductibility of certain compensation-related items.

LIQUIDITY AND CAPITAL RESOURCES

We finance our day-to-day operations and growth primarily with cash flows from operations, borrowings under our senior secured credit facilities and other indebtedness, operating leases, trade payables and equity financing.

Indebtedness

The following table presents selected financial information on our indebtedness (in thousands):

	June 28, 2024		December 29, 2023
Senior secured term loan	$	266,750	$	276,250
Total convertible debt	327,184		327,184
Borrowings outstanding on asset-based loan facility	100,000		100,000
Finance leases and other financing obligations	38,558		31,892

Recent Financing Transactions

In March 2024, we amended our senior secured term loan agreement, which reduced the interest rate spread by 75 basis points on our senior secured term loan facility. Additionally, during the twenty-six weeks ended June 28, 2024, we made voluntary principal prepayments of $8.0 million towards the senior secured term loan.

During the twenty-six weeks ended June 28, 2024, we made a scheduled principal payment of $5.0 million towards the unsecured note issued in connection with the GreenLeaf acquisition. The note is presented under the caption “Finance leases and other financing obligations” in the table above.

In November 2023, we announced a two-year share repurchase program in an amount up to $100.0 million, targeting $25.0 million to $100.0 million of share repurchases by the end of fiscal 2025. During the thirteen weeks ended June 28, 2024, we repurchased 129,523 shares of our common stock at an average purchase price of $38.58 per share and during the twenty-six weeks ended June 28, 2024, we repurchased 264,076 shares of our common stock at an average purchase price of $37.86 per share. The share repurchases were funded by our available cash. The remaining share purchase authorization was $90.0 million at June 28, 2024. We are not obligated to repurchase any specific number of shares and may suspend or discontinue the program at any time.

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Liquidity

The following table presents selected financial information on liquidity (in thousands):

	June 28, 2024		December 29, 2023
Cash and cash equivalents	$	38,340	$	49,878
Working capital(1), excluding cash and cash equivalents	302,675		295,288
Availability under asset-based loan facility	170,623		172,030

(1) We define working capital as current assets less current liabilities.

We expect our capital expenditures, excluding cash paid for acquisitions, for fiscal 2024 will be approximately $40.0 million to $45.0 million. We believe our existing balances of cash and cash equivalents, working capital and the availability under our asset-based loan facility, are sufficient to satisfy our working capital needs, capital expenditures, debt service and other liquidity requirements associated with our current operations over the next twelve months.

Cash Flows

The following table presents selected financial information on cash flows (in thousands):

	Twenty-Six Weeks Ended
	June 28, 2024		June 30, 2023
Net cash provided by operating activities	$	60,226	$	10,783
Net cash used in investing activities	(33,438)		(142,735)
Net cash (used in) provided by financing activities	(38,363)		32,995

Our cash provided by operating activities is predominately driven by net sales to our customers. Our cash used in operating activities is primarily driven by our payments to suppliers for our inventory, employee compensation, payments to support our facilities, our distribution network, interest on our indebtedness, payments to tax authorities and other general corporate expenditures. Net cash provided by operations was $60.2 million for the twenty-six weeks ended June 28, 2024 compared to $10.8 million for the twenty-six weeks ended June 30, 2023. The increase in cash provided by operating activities was primarily due to sales growth and lower inventory purchase levels in the current period as the prior year results included a strategic pull forward of inventory purchases that did not recur.

Net cash used in investing activities was $33.4 million for the twenty-six weeks ended June 28, 2024, driven by capital expenditures of $33.1 million.

Net cash used in financing activities was $38.4 million for the twenty-six weeks ended June 28, 2024 driven by $14.5 million of payments of debt and other financing obligations, $10.0 million used to repurchase our common stock, $7.3 million paid for shares surrendered to pay tax withholding related to the vesting of equity incentive plan awards, $3.6 million of earn-out payments and $3.8 million of finance lease payments.

Recent Accounting Pronouncements

Information related to new accounting guidance is included in Note 1 “Operations and Basis of Presentation” to our condensed consolidated financial statements in this Quarterly Report on Form 10-Q.

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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Interest Rate Risk

Our exposure to interest rate market risk relates primarily to our long-term debt. As of June 28, 2024, we had aggregate indebtedness outstanding of $367.6 million that bore interest at variable rates. A 100 basis point increase in market interest rates would decrease our after-tax earnings by approximately $2.6 million per annum, holding other variables constant.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

The Company, under the supervision and with the participation of its management, including the Chief Executive Officer and the Chief Financial Officer, evaluated the effectiveness of the design and operation of the Company’s “disclosure controls and procedures” (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) as of the end of the period covered by this report. Based on that evaluation, the Chief Executive Officer and the Chief Financial Officer concluded that the Company's disclosure controls and procedures were effective as of June 28, 2024.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting that occurred during the quarter ended June 28, 2024 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

We are involved in legal proceedings, claims and litigation arising out of the ordinary conduct of our business. Although we cannot assure the outcome, management presently believes that the result of such legal proceedings, either individually or in the aggregate, will not have a material adverse effect on our condensed consolidated financial statements, and no material amounts have been accrued in our condensed consolidated financial statements with respect to these matters.

ITEM 1A. RISK FACTORS

There have been no material changes to our risk factors as previously disclosed in Part I, Item 1A. included in our Annual Report on Form 10-K for the year ended December 29, 2023. In addition to the information contained herein, you should consider the risk factors disclosed in our Annual Report on Form 10-K.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES, USE OF PROCEEDS AND ISSUER PURCHASES OF EQUITY SECURITIES

Issuer Purchases of Equity Securities

	Total Number of Shares Repurchased(1)	Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs(2)	Approximate Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs (in thousands)
March 30, 2024 to April 26, 2024	1,919	$	36.86	—	$	95,000
April 27, 2024 to May 24, 2024	4,740	36.30		—	95,000
May 25, 2024 to June 28, 2024	129,979	38.58		129,523	90,000
Total	136,638	$	38.48	129,523	$	90,000

(1)Represents withholding of 136,638 shares of our common stock during the thirteen weeks ended June 28, 2024 to satisfy tax withholding requirements related to restricted shares of our common stock awarded to our officers and key employees

22

resulting from either elections under 83(b) of the Internal Revenue Code of 1986, as amended, or upon vesting of such awards, in addition to shares purchased as part of a publicly announced program.

(2)In November 2023, we announced a two-year share repurchase program in an amount up to $100.0 million targeting $25.0 million to $100.0 million of share repurchases by the end of fiscal 2025.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

None.

ITEM 5. OTHER INFORMATION

Rule 10b5-1 and Non-Rule 10b5-1 Trading Arrangements

During the quarterly period covered by this report, none of the Company’s directors or officers (as defined in Rule 16a-1(f) of the Securities Exchange Act, of 1934, as amended) adopted, terminated or modified any contract, instruction or written plan for the purchase or sale of the Company’s common stock that was intended to satisfy the affirmative defense conditions of Exchange Act Rule 10b5-1(c) or any non-Rule 10b5-1 trading arrangement (as defined in Item 408 of Regulation S-K).

23

ITEM 6. EXHIBITS

Exhibit No.	Description
31.1	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS	XBRL Instance Document – the instance document does not appear on the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
101.SCH	XBRL Taxonomy Extension Schema Document
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	XBRL Taxonomy Extension Label Linkbase Document
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document
104	Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document.

24

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized on July 31, 2024.

	THE CHEFS’ WAREHOUSE, INC.
	(Registrant)
Date: July 31, 2024	/s/ James Leddy
	James Leddy
	Chief Financial Officer
	(Principal Financial Officer)
Date: July 31, 2024	/s/ Timothy McCauley
	Timothy McCauley
	Chief Accounting Officer
	(Principal Accounting Officer)

25

EX-31.1

Exhibit 31.1

CERTIFICATIONS

I, Christopher Pappas, certify that:

1.    I have reviewed this quarterly report on Form 10-Q of The Chefs’ Warehouse, Inc.;

2.    Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.    The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rule 13a-15(f) and Rule 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.    The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent function):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated: July 31, 2024		/s/ Christopher Pappas
	By:	Christopher Pappas
		Chairman, President and Chief Executive Officer
		(Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATIONS

I, James Leddy, certify that:

1.    I have reviewed this quarterly report on Form 10-Q of The Chefs’ Warehouse, Inc.;

2.    Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.    The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rule 13a-15(f) and Rule 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.    The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent function):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated: July 31, 2024		/s/ James Leddy
	By:	James Leddy
		Chief Financial Officer
		(Principal Financial Officer)

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the quarterly report of The Chefs’ Warehouse, Inc. (the “Company”) on Form 10-Q for the quarter ended June 28, 2024, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Christopher Pappas, President and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1)The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: July 31, 2024	By:	/s/ Christopher Pappas
		Christopher Pappas
		Chairman, President and Chief Executive Officer
		(Principal Executive Officer)

A signed original of this written statement has been provided to the Company and will be retained by the Company and furnished to the SEC or its staff upon request.

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the quarterly report of The Chefs’ Warehouse, Inc. (the “Company”) on Form 10-Q for the quarter ended June 28, 2024, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, James Leddy, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1)The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: July 31, 2024	By:	/s/ James Leddy
		James Leddy
		Chief Financial Officer
		(Principal Financial Officer)

A signed original of this written statement has been provided to the Company and will be retained by the Company and furnished to the SEC or its staff upon request.

XML

Cover Page - shares	6 Months Ended
	Jun. 28, 2024	Jul. 29, 2024
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 28, 2024
Document Transition Report	false
Entity File Number	001-35249
Entity Registrant Name	CHEFS’ WAREHOUSE, INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	20-3031526
Entity Address, Address Line One	100 East Ridge Road
Entity Address, City or Town	Ridgefield
Entity Address, State or Province	CT
Entity Address, Postal Zip Code	06877
City Area Code	203
Local Phone Number	894-1345
Title of 12(b) Security	Common Stock, par value $0.01
Trading Symbol	CHEF
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		39,826,473
Entity Central Index Key	0001517175
Current Fiscal Year End Date	--12-27
Amendment Flag	false
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2024

XML

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands	Jun. 28, 2024	Dec. 29, 2023
Current assets:
Cash and cash equivalents	$ 38,340	$ 49,878
Accounts receivable, net of allowances ($22,493 in 2024, $21,423 in 2023)	323,433	334,015
Inventories	310,355	284,528
Prepaid expenses and other current assets	68,421	62,522
Total current assets	740,549	730,943
Property and equipment, net	259,585	234,793
Operating lease right-of-use assets	179,813	192,307
Goodwill	356,531	356,021
Intangible assets, net	172,461	184,863
Other assets	6,482	6,379
Total assets	1,715,421	1,705,306
Current liabilities:
Accounts payable	220,391	200,547
Accrued liabilities	61,761	70,728
Short-term operating lease liabilities	23,502	24,246
Accrued compensation	37,254	37,071
Current portion of long-term debt	56,626	53,185
Total current liabilities	399,534	385,777
Long-term debt, net of current portion	660,759	664,802
Operating lease liabilities	173,042	184,034
Deferred taxes, net	17,413	14,418
Other liabilities	2,794	1,603
Total liabilities	1,253,542	1,250,634
Commitments and contingencies
Stockholders’ equity:
Preferred Stock - $0.01 par value, 5,000,000 shares authorized, no shares issued and outstanding at June 28, 2024 and December 29, 2023, respectively	0	0
Common Stock - $0.01 par value, 100,000,000 shares authorized, 39,805,717 and 39,665,796 shares issued and outstanding at June 28, 2024 and December 29, 2023, respectively	398	396
Additional paid-in capital	356,363	356,157
Accumulated other comprehensive loss	(2,284)	(1,832)
Retained earnings	117,406	99,951
Treasury stock	(10,004)	0
Total stockholders’ equity	461,879	454,672
Total liabilities and stockholders’ equity	$ 1,715,421	$ 1,705,306

XML

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - USD ($) $ in Thousands	Jun. 28, 2024	Dec. 29, 2023
Current assets:
Accounts receivable, allowance for credit loss, current	$ 22,493	$ 21,423
Stockholders’ equity:
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, authorized (in shares)	5,000,000	5,000,000
Preferred stock, issued (in shares)	0	0
Preferred stock, outstanding (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, authorized (in shares)	100,000,000	100,000,000
Common stock, issued (in shares)	39,805,717	39,665,796
Common stock, outstanding (in shares)	39,805,717	39,665,796

XML

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (Unaudited) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 28, 2024	Jun. 30, 2023	Jun. 28, 2024	Jun. 30, 2023
Income Statement [Abstract]
Net sales	$ 954,704	$ 881,820	$ 1,829,192	$ 1,601,465
Cost of sales	725,702	673,376	1,390,754	1,223,313
Gross profit	229,002	208,444	438,438	378,152
Selling, general and administrative expenses	194,834	179,042	385,155	335,179
Other operating expenses, net	301	4,062	3,413	5,734
Operating income	33,867	25,340	49,870	37,239
Interest expense	11,690	12,006	24,934	22,012
Income before income taxes	22,177	13,334	24,936	15,227
Provision for income tax expense	6,653	3,467	7,481	3,959
Net income	15,524	9,867	17,455	11,268
Other comprehensive (loss) income:
Foreign currency translation adjustments	(129)	193	(452)	274
Comprehensive income	$ 15,395	$ 10,060	$ 17,003	$ 11,542
Net income per share:
Basic (in dollars per share)	$ 0.41	$ 0.26	$ 0.46	$ 0.30
Diluted (in dollars per share)	$ 0.37	$ 0.25	$ 0.44	$ 0.29
Weighted average common shares outstanding:
Basic (in shares)	37,924,931	37,634,127	37,871,080	37,570,595
Diluted (in shares)	45,947,728	45,604,297	45,959,061	38,201,408

XML

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Unaudited) - USD ($) $ in Thousands	Total	Common Stock	Additional Paid-in Capital	Accumulated Other Comprehensive Loss	Retained Earnings	Treasury Stock
Balance, beginning (in shares) at Dec. 30, 2022		38,599,390
Treasury stock, beginning balance (in shares) at Dec. 30, 2022						0
Balance, beginning at Dec. 30, 2022	$ 401,509	$ 386	$ 337,947	$ (2,185)	$ 65,361	$ 0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	1,401				1,401
Stock compensation	4,780		4,780
Cumulative translation adjustment	81			81
Common stock issued under stock plans, net of shares surrendered to pay tax withholding (in shares)		944,741
Common stock issued under stock plans, net of shares surrendered to pay tax withholding	(1,819)	$ 9	(1,828)
Balance, ending (in shares) at Mar. 31, 2023		39,544,131
Treasury stock, ending balance (in shares) at Mar. 31, 2023						0
Balance, ending at Mar. 31, 2023	405,952	$ 395	340,899	(2,104)	66,762	$ 0
Balance, beginning (in shares) at Dec. 30, 2022		38,599,390
Treasury stock, beginning balance (in shares) at Dec. 30, 2022						0
Balance, beginning at Dec. 30, 2022	401,509	$ 386	337,947	(2,185)	65,361	$ 0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	11,268
Cumulative translation adjustment	274
Balance, ending (in shares) at Jun. 30, 2023		39,665,691
Treasury stock, ending balance (in shares) at Jun. 30, 2023						0
Balance, ending at Jun. 30, 2023	422,975	$ 396	347,861	(1,911)	76,629	$ 0
Balance, beginning (in shares) at Mar. 31, 2023		39,544,131
Treasury stock, beginning balance (in shares) at Mar. 31, 2023						0
Balance, beginning at Mar. 31, 2023	405,952	$ 395	340,899	(2,104)	66,762	$ 0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	9,867				9,867
Stock compensation	4,704		4,704
Shares issued for acquisitions (in shares)		75,008
Shares issued for acquisition	2,496	$ 1	2,495
Cumulative translation adjustment	193			193
Common stock issued under stock plans, net of shares surrendered to pay tax withholding (in shares)		46,552
Common stock issued under stock plans, net of shares surrendered to pay tax withholding	(237)		(237)
Balance, ending (in shares) at Jun. 30, 2023		39,665,691
Treasury stock, ending balance (in shares) at Jun. 30, 2023						0
Balance, ending at Jun. 30, 2023	$ 422,975	$ 396	347,861	(1,911)	76,629	$ 0
Balance, beginning (in shares) at Dec. 29, 2023	39,665,796	39,665,796
Treasury stock, beginning balance (in shares) at Dec. 29, 2023						0
Balance, beginning at Dec. 29, 2023	$ 454,672	$ 396	356,157	(1,832)	99,951	$ 0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	1,931				1,931
Stock compensation	3,590		3,590
Common stock repurchased (in shares)						(134,553)
Common stock repurchased	(5,004)					$ (5,004)
Warrants exercised (in shares)		32,454
Warrants exercised	0	$ 1	(1)
Cumulative translation adjustment	(323)			(323)
Common stock issued under stock plans, net of shares surrendered to pay tax withholding (in shares)		75,105
Common stock issued under stock plans, net of shares surrendered to pay tax withholding	(7,073)	$ 1	(7,074)
Balance, ending (in shares) at Mar. 29, 2024		39,773,355
Treasury stock, ending balance (in shares) at Mar. 29, 2024						(134,553)
Balance, ending at Mar. 29, 2024	$ 447,793	$ 398	352,672	(2,155)	101,882	$ (5,004)
Balance, beginning (in shares) at Dec. 29, 2023	39,665,796	39,665,796
Treasury stock, beginning balance (in shares) at Dec. 29, 2023						0
Balance, beginning at Dec. 29, 2023	$ 454,672	$ 396	356,157	(1,832)	99,951	$ 0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	17,455
Cumulative translation adjustment	$ (452)
Balance, ending (in shares) at Jun. 28, 2024	39,805,717	39,805,717
Treasury stock, ending balance (in shares) at Jun. 28, 2024						(264,076)
Balance, ending at Jun. 28, 2024	$ 461,879	$ 398	356,363	(2,284)	117,406	$ (10,004)
Balance, beginning (in shares) at Mar. 29, 2024		39,773,355
Treasury stock, beginning balance (in shares) at Mar. 29, 2024						(134,553)
Balance, beginning at Mar. 29, 2024	447,793	$ 398	352,672	(2,155)	101,882	$ (5,004)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	15,524				15,524
Stock compensation	3,946		3,946
Common stock repurchased (in shares)						(129,523)
Common stock repurchased	(5,000)					$ (5,000)
Warrants exercised (in shares)		1,850
Cumulative translation adjustment	(129)			(129)
Common stock issued under stock plans, net of shares surrendered to pay tax withholding (in shares)		30,512
Common stock issued under stock plans, net of shares surrendered to pay tax withholding	$ (255)		(255)
Balance, ending (in shares) at Jun. 28, 2024	39,805,717	39,805,717
Treasury stock, ending balance (in shares) at Jun. 28, 2024						(264,076)
Balance, ending at Jun. 28, 2024	$ 461,879	$ 398	$ 356,363	$ (2,284)	$ 117,406	$ (10,004)

XML

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands	6 Months Ended
	Jun. 28, 2024	Jun. 30, 2023
Cash flows from operating activities:
Net income	$ 17,455	$ 11,268
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	18,771	15,682
Amortization of intangible assets	12,342	10,456
Provision for allowance for doubtful accounts	6,097	3,311
Provision for deferred income taxes	3,003	990
Loss on debt extinguishment	366	0
Stock compensation	8,754	10,581
Change in fair value of contingent earn-out liabilities	(615)	1,092
Intangible asset impairment	0	1,838
Non-cash interest and other operating activities	2,747	3,647
Changes in assets and liabilities, net of acquisitions:
Accounts receivable	4,269	(9,854)
Inventories	(25,431)	(35,450)
Prepaid expenses and other current assets	(3,368)	(2,435)
Accounts payable, accrued liabilities and accrued compensation	17,812	453
Other assets and liabilities	(1,976)	(796)
Net cash provided by operating activities	60,226	10,783
Cash flows from investing activities:
Capital expenditures	(33,123)	(23,155)
Cash paid for acquisitions, net of cash acquired	(315)	(119,580)
Net cash used in investing activities	(33,438)	(142,735)
Cash flows from financing activities:
Payment of debt and other financing obligations	(14,500)	(10,238)
Payment of finance leases	(3,839)	(1,442)
Common stock repurchases	(10,004)	0
Surrender of shares to pay withholding taxes	(7,283)	(2,115)
Cash paid for contingent earn-out liability	(3,550)	(3,210)
Borrowings under asset-based loan facility and revolving credit facilities	813	50,000
Net cash (used in) provided by financing activities	(38,363)	32,995
Effect of foreign currency on cash and cash equivalents	37	(251)
Net change in cash and cash equivalents	(11,538)	(99,208)
Cash and cash equivalents-beginning of period	49,878	158,800
Cash and cash equivalents-end of period	$ 38,340	$ 59,592

XML

Operations and Basis of Presentation

6 Months Ended

Jun. 28, 2024

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Operations and Basis of Presentation

Operations and Basis of Presentation

Description of Business and Basis of Presentation

The Chefs’ Warehouse, Inc. (the “Company”), and its wholly-owned subsidiaries, is a premier distributor of specialty food and center-of-the-plate products in the United States, the Middle East and Canada. The Company is 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 Company’s quarterly periods end on the thirteenth Friday of each quarter. Every six to seven years, the Company will add a fourteenth week to its fourth quarter to more closely align its year-end to the calendar year. The Company’s business consists of three operating segments: East, Midwest and West that aggregate into one reportable segment, foodservice distribution, which is concentrated primarily in the United States.

Consolidation

The unaudited condensed consolidated financial statements include all the accounts of the Company and its direct and indirect wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated.

Unaudited Interim Financial Statements

The accompanying unaudited condensed consolidated financial statements and the related interim information contained within the notes to such unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and the applicable rules of the Securities and Exchange Commission (“SEC”) for interim information and quarterly reports on Form 10-Q. Accordingly, they do not include all the information and disclosures required by GAAP for complete financial statements. These unaudited condensed consolidated financial statements and related notes should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto for the fiscal year ended December 29, 2023 filed as part of the Company’s Annual Report on Form 10-K (the “2023 Form 10-K”).

The unaudited condensed consolidated financial statements appearing in this Form 10-Q have been prepared on the same basis as the audited consolidated financial statements included in the Company’s 2023 Form 10-K, and in the opinion of management, include all normal recurring adjustments that are necessary for the fair statement of the Company’s interim period results. The year-end consolidated balance sheet data was derived from the audited financial statements but does not include all disclosures required by GAAP. Due to seasonal fluctuations and other factors, the results of operations for the thirteen and twenty-six weeks ended June 28, 2024 are not necessarily indicative of the results to be expected for the full year.

The preparation of financial statements in conformity with GAAP requires management to make significant estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from management’s estimates.

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Summary of Significant Accounting Policies

6 Months Ended

Jun. 28, 2024

Revenue from Contract with Customer [Abstract]

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

Revenue Recognition

The following table presents the Company’s net sales disaggregated by principal product category:

	Thirteen Weeks Ended								Twenty-Six Weeks Ended
	June 28, 2024				June 30, 2023				June 28, 2024				June 30, 2023
Center-of-the-Plate	$	365,387	38.3	%	$	338,390	38.4	%	$	708,323	38.7	%	$	646,311	40.4	%
Specialty:
Dry Goods	154,575		16.2	%	137,985		15.6	%	293,385		16.0	%	261,325		16.3	%
Produce	136,295		14.3	%	124,766		14.1	%	262,420		14.3	%	172,553		10.8	%
Pastry	114,224		12.0	%	108,143		12.3	%	216,092		11.8	%	198,252		12.4	%
Cheese and Charcuterie	68,820		7.2	%	64,947		7.4	%	128,119		7.0	%	120,664		7.5	%
Dairy and Eggs	62,674		6.6	%	56,678		6.4	%	120,800		6.6	%	106,751		6.7	%
Oils and Vinegars	33,811		3.5	%	33,131		3.8	%	63,617		3.5	%	62,510		3.9	%
Kitchen Supplies	18,918		1.9	%	17,780		2.0	%	36,436		2.1	%	33,099		2.0	%
Total Specialty	$	589,317	61.7	%	$	543,430	61.6	%	$	1,120,869	61.3	%	$	955,154	59.6	%
Total net sales	$	954,704	100	%	$	881,820	100	%	$	1,829,192	100	%	$	1,601,465	100	%

The Company determines its product category classification based on how the Company currently markets its products to its customers. The Company’s definition of its principal product categories may differ from the way in which other companies present similar information. Net sales by product category includes estimates of product mix for certain locations that are not yet fully integrated into the Company’s information technology systems as of the reporting date. Prior period product category amounts have been reclassified to conform to the current period’s presentation.

Food Processing Costs

Food processing costs include, but are not limited to, direct labor and benefits, applicable overhead and depreciation of equipment and facilities used in food processing activities. Food processing costs included in cost of sales were $18,277 and $16,615 for the thirteen weeks ended June 28, 2024 and June 30, 2023, respectively, and $37,347 and $28,289 for the twenty-six weeks ended June 28, 2024 and June 30, 2023, respectively.

Share Repurchases

The Company has a share repurchase program that is executed through purchases made from time to time either in the open market or through private market transactions. Shares purchased under the program are recorded at cost and held as treasury stock.

Guidance Not Yet Adopted

Improvements to Income Tax Disclosures: In December 2023, the Financial Accounting Standards Board (“FASB”) issued guidance designed to improve the transparency and usefulness of income tax disclosures. The amendments include provisions to address the consistency of the income tax rate reconciliation and requirement to disaggregate income taxes paid by jurisdiction. The guidance is effective for fiscal years beginning after December 15, 2024. Early adoption is permitted. The Company expects to adopt this guidance when effective and is evaluating the impact of adoption on its consolidated financial statements, which is limited to financial statement disclosures.

Improvements to Reportable Segment Disclosures: In November 2023, the FASB issued guidance which requires entities, including those with one reportable segment, to enhance reportable segment disclosures requirements particularly with respect to significant expenses. The guidance is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024 on a retrospective basis. Early adoption is permitted. The Company expects to adopt this guidance when effective and is evaluating the impact of adoption on its consolidated financial statements, which is limited to financial statement disclosures.

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Net Income per Share

6 Months Ended

Jun. 28, 2024

Earnings Per Share [Abstract]

Net Income per Share

Net Income per Share

Basic net income per share is calculated by dividing net income by the weighted average number of shares of common stock outstanding during the period. Diluted net income per share adjusts basic net income per share for all the potentially dilutive shares outstanding during the period.

The following table sets forth the computation of basic and diluted net income per common share:

	Thirteen Weeks Ended				Twenty-Six Weeks Ended
	June 28, 2024		June 30, 2023		June 28, 2024		June 30, 2023
Net income per share:
Basic	$	0.41	$	0.26	$	0.46	$	0.30
Diluted	$	0.37	$	0.25	$	0.44	$	0.29
Weighted average common shares:
Basic	37,924,931		37,634,127		37,871,080		37,570,595
Diluted	45,947,728		45,604,297		45,959,061		38,201,408

Reconciliation of net income per common share:

	Thirteen Weeks Ended				Twenty-Six Weeks Ended
	June 28, 2024		June 30, 2023		June 28, 2024		June 30, 2023
Numerator:
Net income	$	15,524	$	9,867	$	17,455	$	11,268
Add effect of dilutive securities
Interest on convertible notes, net of tax	1,322		1,397		2,628		—
Net income available to common shareholders	$	16,846	$	11,264	$	20,083	$	11,268
Denominator:
Weighted average basic common shares outstanding	37,924,931		37,634,127		37,871,080		37,570,595
Dilutive effect of unvested common shares	573,930		521,102		642,767		564,119
Dilutive effect of stock options and warrants	56,050		56,251		52,397		66,694
Dilutive effect of convertible notes	7,392,817		7,392,817		7,392,817		—
Weighted average diluted common shares outstanding	45,947,728		45,604,297		45,959,061		38,201,408

Potentially dilutive securities that have been excluded from the calculation of diluted net income per common share because the effect is anti-dilutive are as follows:

	Thirteen Weeks Ended		Twenty-Six Weeks Ended
	June 28, 2024	June 30, 2023	June 28, 2024	June 30, 2023
Restricted share awards (“RSAs”) and restricted stock units (“RSUs”)	160,273	46,746	286,769	29,717
Convertible notes	—	—	—	7,392,817

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Fair Value Measurements

6 Months Ended

Jun. 28, 2024

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair Value Measurements

Assets and Liabilities Measured at Fair Value

The Company’s contingent earn-out liabilities are measured at fair value. These liabilities were estimated using Level 3 inputs. The fair value of contingent consideration was predominantly determined based on a probability-based approach which includes projected results, percentage probability of occurrence and the application of a discount rate to present value the payments. A significant change in projected results, discount rate, or probabilities of occurrence could result in a significantly higher or lower fair value measurement. Changes in the fair value of contingent earn-out liabilities are reflected in other operating expenses, net on the condensed consolidated statements of operations.

The following table presents the changes in Level 3 contingent earn-out liabilities:

	Total
Balance December 29, 2023	$	9,765
Cash payments	(4,250)
Changes in fair value	(615)
Balance June 28, 2024	$	4,900

The long-term portion of contingent earn-out liabilities were $637 and $50 as of June 28, 2024 and December 29, 2023, respectively, and are reflected as other liabilities on the Company’s condensed consolidated balance sheets. The remaining short-term portion of earn-out liabilities are reflected as accrued liabilities on the Company’s condensed consolidated balance sheets.

Fair Value of Financial Instruments

The carrying amounts reported in the Company’s condensed consolidated balance sheets for accounts receivable and accounts payable approximate fair value due to their immediate to short-term nature. The fair values of the asset-based loan facility and term loan approximated their book values as of June 28, 2024 and December 29, 2023, as these instruments had variable interest rates that reflected current market rates available to the Company and are classified as Level 2 fair value measurements.

The following table presents the carrying value and fair value of the Company’s convertible notes and its unsecured note issued in connection with the acquisition of Oakville Produce Partners, LLC (“GreenLeaf”) in fiscal 2023 (“GreenLeaf Note”). The fair value of the Company’s 2028 Convertible Senior Notes was based on Level 1 inputs. In estimating the fair value of its 2024 Convertible Senior Notes, the Company utilized Level 3 inputs including prevailing market interest rates to estimate the debt portion of the instrument and a Black Scholes valuation model to estimate the fair value of the conversion option. The Black Scholes model utilizes the market price of the Company’s common stock, estimates of the stock’s volatility and the prevailing risk-free interest rate in calculating the fair value estimate. The fair value of the GreenLeaf Note was determined based upon observable market prices of similar debt instruments.

		June 28, 2024				December 29, 2023
	Fair Value Hierarchy	Carrying Value		Fair Value		Carrying Value		Fair Value
2028 Convertible Senior Notes	Level 1	$	287,500	$	318,047	$	287,500	$	277,354
2024 Convertible Senior Notes	Level 3	$	39,684	$	40,300	$	39,684	$	38,609
GreenLeaf Note	Level 2	$	5,000	$	4,888	$	10,000	$	9,991

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Acquisitions

6 Months Ended

Jun. 28, 2024

Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract]

Acquisitions

Acquisitions

The Company paid approximately $315 during the twenty-six weeks ended June 28, 2024 upon settlement of net working capital true-ups on prior year acquisitions, resulting in measurement period adjustments which increased goodwill by $656 and reduced prepaid expenses and other current assets by $341.

The Company recognized professional fees related to acquisition activities of $1,385 and $2,628 during the thirteen and twenty-six weeks ended June 30, 2023, respectively, presented within other operating expenses, net on the condensed consolidated

statements of operations. There were no professional fees related to acquisition activities recorded during the thirteen and twenty-six weeks ended June 28, 2024.

Unaudited Pro forma Financial Information

The table below presents unaudited pro forma condensed consolidated income statement information of the Company as if the GreenLeaf and Hardie’s Fresh Foods acquisitions had occurred on December 30, 2022. The pro forma results were prepared from financial information obtained from the sellers of the business, as well as information obtained during the due diligence process associated with the acquisitions. The pro forma information is not necessarily indicative of the Company’s results of operations had the acquisitions been completed on the above date, nor is it necessarily indicative of the Company’s future results. The pro forma information does not reflect any cost savings from operating efficiencies or synergies that could result from the acquisitions, any incremental costs for transitioning to become a public company, and also does not reflect additional revenue opportunities following the acquisitions. The pro forma information reflects amortization expense related to the acquired intangible assets and depreciation expense on the acquired fair value of property and equipment. The pro forma information also reflects additional interest expense that would have been incurred by the Company to finance the acquisitions. Pro forma interest expense was estimated based on the prevailing interest rates charged on the Company’s senior secured term loan during fiscal 2022.

	Thirteen Weeks Ended			Twenty-Six Weeks Ended
		June 30, 2023			June 30, 2023
Net sales		$	892,161		$	1,695,649
Income before income taxes		$	13,617		$	16,752

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Inventories

6 Months Ended

Jun. 28, 2024

Inventory Disclosure [Abstract]

Inventories

InventoriesInventories consist primarily of finished product and are reflected net of adjustments for shrinkage, excess and obsolescence to approximate their net realizable value totaling $12,157 and $11,205 at June 28, 2024 and December 29, 2023, respectively.

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Property and Equipment

6 Months Ended

Jun. 28, 2024

Property, Plant and Equipment [Abstract]

Property and Equipment

Property and Equipment

Property and equipment is net of accumulated depreciation and amortization of $154,745 and $137,008 at June 28, 2024 and December 29, 2023, respectively.

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Goodwill and Other Intangible Assets

6 Months Ended

Jun. 28, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangible Assets

Goodwill and Other Intangible Assets

The changes in the carrying amount of goodwill are presented as follows:

Carrying amount as of December 29, 2023	$	356,021
Goodwill adjustments	656
Foreign currency translation	(146)
Carrying amount as of June 28, 2024	$	356,531

The goodwill adjustments included in the table above represent measurement period adjustments related to certain acquisitions completed in the prior year.

Other intangible assets are net of accumulated amortization of $145,002 and $132,660 as of June 28, 2024 and December 29, 2023, respectively. Amortization expense for other intangibles was $6,171 and $5,759 for the thirteen weeks ended June 28, 2024 and June 30, 2023, respectively, and $12,342 and $10,456 for the twenty-six weeks ended June 28, 2024 and June 30, 2023, respectively.

The Company recognized a customer relationships intangible asset impairment charge of $1,838, $1,333 net of tax, during the thirteen and twenty-six weeks ended June 30, 2023 related to the loss of a significant Hardie’s Fresh Foods customer post-acquisition.

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Debt Obligations

6 Months Ended

Jun. 28, 2024

Debt Disclosure [Abstract]

Debt Obligations

Debt Obligations

Debt obligations as of June 28, 2024 and December 29, 2023 consisted of the following:

	Weighted Average Effective Interest Rate at June 28, 2024		Maturity	June 28, 2024		December 29, 2023
Senior secured term loans	10.10	%	August 2029	$	266,750	$	276,250
2028 Convertible senior notes	2.77	%	December 2028	287,500		287,500
2024 Convertible senior notes	2.34	%	December 2024	39,684		39,684
Asset-based loan facility	7.47	%	March 2027	100,000		100,000
Finance leases and other financing obligations	6.48	%	Various	38,558		31,892
Unamortized deferred costs and premium				(15,107)		(17,339)
Total debt obligations				717,385		717,987
Less: current installments				(56,626)		(53,185)
Total long-term debt				$	660,759	$	664,802

Senior Secured Term Loan Credit Facility

In March 2024, the Company entered into an eleventh amendment (“Eleventh Amendment”) to its senior secured term loan agreement, which reduced the interest rate spread on its senior secured term loan facility. As a result of this amendment, the Company incurred a loss on debt extinguishment of $50 during the twenty-six weeks ended June 28, 2024, which represents the portion of unamortized deferred financing fees attributable to the lender that exited the loan syndicate. Arrangement fees of $775 and third-party transaction costs of $91 were expensed as incurred during the twenty-six weeks ended June 28, 2024 and included in interest expense and other operating expenses, respectively, within the Company’s condensed consolidated statements of operations.

Additionally, during the twenty-six weeks ended June 28, 2024, the Company made voluntary principal prepayments totaling $8,000 towards the senior secured term loan. In connection with the prepayments, the Company wrote-off unamortized deferred financing fees of $77 and $316 during the thirteen and twenty-six weeks ended June 28, 2024, respectively, which were included in interest expense within the Company’s condensed consolidated statements of operations.

GreenLeaf Unsecured Note

During the twenty-six weeks ended June 28, 2024, the Company made a scheduled principal payment of $5,000 towards the GreenLeaf Note. The GreenLeaf Note is presented under the caption “Finance leases and other financing obligations” in the table above.

Convertible Notes

The net carrying value of the Company’s convertible senior notes as of June 28, 2024 and December 29, 2023 was:

	June 28, 2024						December 29, 2023
	Principal Amount		Unamortized Deferred Costs and Premium		Net Amount		Principal Amount		Unamortized Deferred Costs and Premium		Net Amount
2028 Notes	$	287,500	$	(5,157)	$	282,343	$	287,500	$	(5,730)	$	281,770
2024 Notes	39,684		(93)		39,591		39,684		(185)		39,499
Total	$	327,184	$	(5,250)	$	321,934	$	327,184	$	(5,915)	$	321,269

The components of interest expense on the Company’s convertible notes were as follows:

	Thirteen Weeks Ended				Twenty-Six Weeks Ended
	June 28, 2024		June 30, 2023		June 28, 2024		June 30, 2023
Coupon interest	$	1,893	$	1,893	$	3,786	$	3,792
Amortization of deferred costs and premium	333		333		666		668
Total interest	$	2,226	$	2,226	$	4,452	$	4,460

As of June 28, 2024, the Company had reserved $29,377 of its asset-based loan facility for the issuance of letters of credit and funds totaling $170,623 were available for borrowing.

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Stockholders' Equity

6 Months Ended

Jun. 28, 2024

Stockholders' Equity Note [Abstract]

Stockholders' Equity

Stockholders’ Equity

Equity Awards

The following table reflects the activity of RSAs and RSUs during the twenty-six weeks ended June 28, 2024:

	Time-based			Performance-based			Market-based
	Shares	Weighted Average Grant Date Fair Value		Shares	Weighted Average Grant Date Fair Value		Shares	Weighted Average Grant Date Fair Value
Unvested at December 29, 2023	461,752	$	32.13	1,078,169	$	32.88	421,056	$	30.00
Granted	248,934	37.86		313,188	38.53		55,270	34.68
Vested	(223,099)	31.80		(172,232)	32.07		(166,343)	31.43
Forfeited	(5,650)	34.03		(325,267)	33.48		(3,956)	31.00
Unvested at June 28, 2024	481,937	$	35.21	893,858	$	34.80	306,027	$	30.06

The Company granted 617,392 RSAs and RSUs to its employees and directors at a weighted average grant date fair value of $37.91 during the twenty-six weeks ended June 28, 2024. These awards are a mix of time-, market- and performance-based grants that generally vest over a range of periods up to 5 years. The Company recognized expense on its RSAs and RSUs totaling $3,946 and $4,704 during the thirteen weeks ended June 28, 2024 and June 30, 2023, respectively, and $7,536 and $9,494 during the twenty-six weeks ended June 28, 2024 and June 30, 2023, respectively.

At June 28, 2024, the total unrecognized compensation cost for unvested RSAs and RSUs was $27,702 and the weighted-average remaining period was approximately 1.8 years. Of this total, $14,525 related to awards with time-based vesting provisions and $13,177 related to awards with performance- and market-based vesting provisions. At June 28, 2024, the weighted-average remaining period for time-based vesting and performance-based vesting RSAs and RSUs were approximately 1.7 years and 2.0 years, respectively.

No share-based compensation expense has been capitalized.

Share Repurchase Program

In November 2023, the Company announced a two-year share repurchase program in an amount up to $100,000, targeting $25,000 to $100,000 of share repurchases by the end of fiscal 2025. The remaining share purchase authorization was $90,000 at June 28, 2024. The Company is not obligated to repurchase any specific number of shares and may suspend or discontinue the program at any time.

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Related Parties

6 Months Ended

Jun. 28, 2024

Related Party Transactions [Abstract]

Related Parties

Related PartiesThe Chefs’ Warehouse Mid-Atlantic, LLC, a subsidiary of the Company, leases a distribution facility that is 100% owned by entities controlled by Christopher Pappas, the Company’s Chairman, President and Chief Executive Officer, and John Pappas, the Company’s Vice Chairman and Chief Operating Officer, and are deemed to be affiliates of these individuals. Expense related to this facility totaled $176 and $123 during the thirteen weeks ended June 28, 2024 and June 30, 2023, respectively, and $352 and $246 during the twenty-six weeks ended June 28, 2024 and June 30, 2023, respectively.

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Income Taxes

6 Months Ended

Jun. 28, 2024

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

The Company’s effective tax rate was 30.0% and 26.0% for the thirteen weeks ended June 28, 2024 and June 30, 2023, respectively, and 30.0% and 26.0% for the twenty-six weeks ended June 28, 2024 and June 30, 2023, respectively. The higher effective tax rate for the thirteen and twenty-six weeks ended June 28, 2024 is primarily due to the non-deductibility of certain compensation-related items. The effective tax rate otherwise varies from the 21% statutory rate primarily due to state taxes.

The Company’s income tax provision reflects the impact of an expected income tax refund receivable of $25,244 as of June 28, 2024, which is reflected in prepaid expenses and other current assets on the Company’s condensed consolidated balance sheet.

The Organization for Economic Co-operation and Development (the “OECD”) introduced a framework under Pillar Two which includes a global corporate minimum tax rate of 15%. Some jurisdictions in which the Company operates have started to enact laws implementing Pillar Two. The Company is monitoring these developments and currently does not believe the rules effective in fiscal 2024 will have a material impact on its consolidated financial statements.

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Supplemental Disclosures of Cash Flow Information

6 Months Ended

Jun. 28, 2024

Supplemental Cash Flow Elements [Abstract]

Supplemental Disclosures of Cash Flow Information

Supplemental Disclosures of Cash Flow Information

	Twenty-Six Weeks Ended
	June 28, 2024		June 30, 2023
Supplemental cash flow disclosures:
Cash paid for income taxes	$	6,016	$	10,673
Cash paid for interest, net of cash received	$	23,302	$	20,266
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	19,371	$	18,591
Operating cash flows from finance leases	$	895	$	336
ROU assets obtained in exchange for lease liabilities:
Operating leases	$	1,797	$	42,182
Finance leases	$	13,894	$	3,684
Non-cash investing and financing activities:
Common stock issued for acquisitions	$	—	$	2,496
Unsecured notes issued for acquisitions	$	—	$	10,000
Contingent earn-out liabilities for acquisitions	$	—	$	5,835

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Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended				6 Months Ended
	Jun. 28, 2024	Mar. 29, 2024	Jun. 30, 2023	Mar. 31, 2023	Jun. 28, 2024	Jun. 30, 2023
Pay vs Performance Disclosure
Net income	$ 15,524	$ 1,931	$ 9,867	$ 1,401	$ 17,455	$ 11,268

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Insider Trading Arrangements	3 Months Ended
	Jun. 28, 2024
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

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Operations and Basis of Presentation (Policies)

6 Months Ended

Jun. 28, 2024

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Fiscal Period

The Company’s quarterly periods end on the thirteenth Friday of each quarter. Every six to seven years, the Company will add a fourteenth week to its fourth quarter to more closely align its year-end to the calendar year.

Segment Reporting

The Company’s business consists of three operating segments: East, Midwest and West that aggregate into one reportable segment, foodservice distribution, which is concentrated primarily in the United States.

Consolidation

The unaudited condensed consolidated financial statements include all the accounts of the Company and its direct and indirect wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated.

Unaudited Interim Financial Statements

The accompanying unaudited condensed consolidated financial statements and the related interim information contained within the notes to such unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and the applicable rules of the Securities and Exchange Commission (“SEC”) for interim information and quarterly reports on Form 10-Q. Accordingly, they do not include all the information and disclosures required by GAAP for complete financial statements. These unaudited condensed consolidated financial statements and related notes should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto for the fiscal year ended December 29, 2023 filed as part of the Company’s Annual Report on Form 10-K (the “2023 Form 10-K”).

The unaudited condensed consolidated financial statements appearing in this Form 10-Q have been prepared on the same basis as the audited consolidated financial statements included in the Company’s 2023 Form 10-K, and in the opinion of management, include all normal recurring adjustments that are necessary for the fair statement of the Company’s interim period results. The year-end consolidated balance sheet data was derived from the audited financial statements but does not include all disclosures required by GAAP. Due to seasonal fluctuations and other factors, the results of operations for the thirteen and twenty-six weeks ended June 28, 2024 are not necessarily indicative of the results to be expected for the full year.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make significant estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from management’s estimates.

Revenue Recognition and Food Processing Costs

The Company determines its product category classification based on how the Company currently markets its products to its customers. The Company’s definition of its principal product categories may differ from the way in which other companies present similar information. Net sales by product category includes estimates of product mix for certain locations that are not yet fully integrated into the Company’s information technology systems as of the reporting date. Prior period product category amounts have been reclassified to conform to the current period’s presentation.

Food processing costs include, but are not limited to, direct labor and benefits, applicable overhead and depreciation of equipment and facilities used in food processing activities.

Share Repurchases

The Company has a share repurchase program that is executed through purchases made from time to time either in the open market or through private market transactions. Shares purchased under the program are recorded at cost and held as treasury stock.

Guidance Not Yet Adopted

Improvements to Income Tax Disclosures: In December 2023, the Financial Accounting Standards Board (“FASB”) issued guidance designed to improve the transparency and usefulness of income tax disclosures. The amendments include provisions to address the consistency of the income tax rate reconciliation and requirement to disaggregate income taxes paid by jurisdiction. The guidance is effective for fiscal years beginning after December 15, 2024. Early adoption is permitted. The Company expects to adopt this guidance when effective and is evaluating the impact of adoption on its consolidated financial statements, which is limited to financial statement disclosures.

Improvements to Reportable Segment Disclosures: In November 2023, the FASB issued guidance which requires entities, including those with one reportable segment, to enhance reportable segment disclosures requirements particularly with respect to significant expenses. The guidance is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024 on a retrospective basis. Early adoption is permitted. The Company expects to adopt this guidance when effective and is evaluating the impact of adoption on its consolidated financial statements, which is limited to financial statement disclosures.

Net Income per Share

Basic net income per share is calculated by dividing net income by the weighted average number of shares of common stock outstanding during the period. Diluted net income per share adjusts basic net income per share for all the potentially dilutive shares outstanding during the period.

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Summary of Significant Accounting Policies (Tables)

6 Months Ended

Jun. 28, 2024

Revenue from Contract with Customer [Abstract]

Schedule of disaggregation of revenue

The following table presents the Company’s net sales disaggregated by principal product category:

	Thirteen Weeks Ended								Twenty-Six Weeks Ended
	June 28, 2024				June 30, 2023				June 28, 2024				June 30, 2023
Center-of-the-Plate	$	365,387	38.3	%	$	338,390	38.4	%	$	708,323	38.7	%	$	646,311	40.4	%
Specialty:
Dry Goods	154,575		16.2	%	137,985		15.6	%	293,385		16.0	%	261,325		16.3	%
Produce	136,295		14.3	%	124,766		14.1	%	262,420		14.3	%	172,553		10.8	%
Pastry	114,224		12.0	%	108,143		12.3	%	216,092		11.8	%	198,252		12.4	%
Cheese and Charcuterie	68,820		7.2	%	64,947		7.4	%	128,119		7.0	%	120,664		7.5	%
Dairy and Eggs	62,674		6.6	%	56,678		6.4	%	120,800		6.6	%	106,751		6.7	%
Oils and Vinegars	33,811		3.5	%	33,131		3.8	%	63,617		3.5	%	62,510		3.9	%
Kitchen Supplies	18,918		1.9	%	17,780		2.0	%	36,436		2.1	%	33,099		2.0	%
Total Specialty	$	589,317	61.7	%	$	543,430	61.6	%	$	1,120,869	61.3	%	$	955,154	59.6	%
Total net sales	$	954,704	100	%	$	881,820	100	%	$	1,829,192	100	%	$	1,601,465	100	%

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Net Income per Share (Tables)

6 Months Ended

Jun. 28, 2024

Earnings Per Share [Abstract]

Schedule of computation of basic and diluted net income (loss) per share

The following table sets forth the computation of basic and diluted net income per common share:

	Thirteen Weeks Ended				Twenty-Six Weeks Ended
	June 28, 2024		June 30, 2023		June 28, 2024		June 30, 2023
Net income per share:
Basic	$	0.41	$	0.26	$	0.46	$	0.30
Diluted	$	0.37	$	0.25	$	0.44	$	0.29
Weighted average common shares:
Basic	37,924,931		37,634,127		37,871,080		37,570,595
Diluted	45,947,728		45,604,297		45,959,061		38,201,408

Schedule of reconciliation of net income (loss) per common share

Reconciliation of net income per common share:

	Thirteen Weeks Ended				Twenty-Six Weeks Ended
	June 28, 2024		June 30, 2023		June 28, 2024		June 30, 2023
Numerator:
Net income	$	15,524	$	9,867	$	17,455	$	11,268
Add effect of dilutive securities
Interest on convertible notes, net of tax	1,322		1,397		2,628		—
Net income available to common shareholders	$	16,846	$	11,264	$	20,083	$	11,268
Denominator:
Weighted average basic common shares outstanding	37,924,931		37,634,127		37,871,080		37,570,595
Dilutive effect of unvested common shares	573,930		521,102		642,767		564,119
Dilutive effect of stock options and warrants	56,050		56,251		52,397		66,694
Dilutive effect of convertible notes	7,392,817		7,392,817		7,392,817		—
Weighted average diluted common shares outstanding	45,947,728		45,604,297		45,959,061		38,201,408

Schedule of dilutive securities that have been excluded from the calculation of diluted net income (loss) per common share

Potentially dilutive securities that have been excluded from the calculation of diluted net income per common share because the effect is anti-dilutive are as follows:

	Thirteen Weeks Ended		Twenty-Six Weeks Ended
	June 28, 2024	June 30, 2023	June 28, 2024	June 30, 2023
Restricted share awards (“RSAs”) and restricted stock units (“RSUs”)	160,273	46,746	286,769	29,717
Convertible notes	—	—	—	7,392,817

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Fair Value Measurements (Tables)

6 Months Ended

Jun. 28, 2024

Fair Value Disclosures [Abstract]

Schedule of changes in Level 3 contingent consideration liability

The following table presents the changes in Level 3 contingent earn-out liabilities:

	Total
Balance December 29, 2023	$	9,765
Cash payments	(4,250)
Changes in fair value	(615)
Balance June 28, 2024	$	4,900

Schedule of carrying value and fair value of the Company's convertible subordinated notes

The following table presents the carrying value and fair value of the Company’s convertible notes and its unsecured note issued in connection with the acquisition of Oakville Produce Partners, LLC (“GreenLeaf”) in fiscal 2023 (“GreenLeaf Note”). The fair value of the Company’s 2028 Convertible Senior Notes was based on Level 1 inputs. In estimating the fair value of its 2024 Convertible Senior Notes, the Company utilized Level 3 inputs including prevailing market interest rates to estimate the debt portion of the instrument and a Black Scholes valuation model to estimate the fair value of the conversion option. The Black Scholes model utilizes the market price of the Company’s common stock, estimates of the stock’s volatility and the prevailing risk-free interest rate in calculating the fair value estimate. The fair value of the GreenLeaf Note was determined based upon observable market prices of similar debt instruments.

		June 28, 2024				December 29, 2023
	Fair Value Hierarchy	Carrying Value		Fair Value		Carrying Value		Fair Value
2028 Convertible Senior Notes	Level 1	$	287,500	$	318,047	$	287,500	$	277,354
2024 Convertible Senior Notes	Level 3	$	39,684	$	40,300	$	39,684	$	38,609
GreenLeaf Note	Level 2	$	5,000	$	4,888	$	10,000	$	9,991

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Acquisitions (Tables)

6 Months Ended

Jun. 28, 2024

Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract]

Schedule of pro forma consolidated statement of operations information

The pro forma information reflects amortization expense related to the acquired intangible assets and depreciation expense on the acquired fair value of property and equipment. The pro forma information also reflects additional interest expense that would have been incurred by the Company to finance the acquisitions. Pro forma interest expense was estimated based on the prevailing interest rates charged on the Company’s senior secured term loan during fiscal 2022.

	Thirteen Weeks Ended			Twenty-Six Weeks Ended
		June 30, 2023			June 30, 2023
Net sales		$	892,161		$	1,695,649
Income before income taxes		$	13,617		$	16,752

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Goodwill and Other Intangible Assets (Tables)

6 Months Ended

Jun. 28, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of goodwill

The changes in the carrying amount of goodwill are presented as follows:

Carrying amount as of December 29, 2023	$	356,021
Goodwill adjustments	656
Foreign currency translation	(146)
Carrying amount as of June 28, 2024	$	356,531

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Debt Obligations (Tables)

6 Months Ended

Jun. 28, 2024

Debt Disclosure [Abstract]

Schedule of debt obligations

Debt obligations as of June 28, 2024 and December 29, 2023 consisted of the following:

	Weighted Average Effective Interest Rate at June 28, 2024		Maturity	June 28, 2024		December 29, 2023
Senior secured term loans	10.10	%	August 2029	$	266,750	$	276,250
2028 Convertible senior notes	2.77	%	December 2028	287,500		287,500
2024 Convertible senior notes	2.34	%	December 2024	39,684		39,684
Asset-based loan facility	7.47	%	March 2027	100,000		100,000
Finance leases and other financing obligations	6.48	%	Various	38,558		31,892
Unamortized deferred costs and premium				(15,107)		(17,339)
Total debt obligations				717,385		717,987
Less: current installments				(56,626)		(53,185)
Total long-term debt				$	660,759	$	664,802

Schedule of convertible senior notes

The net carrying value of the Company’s convertible senior notes as of June 28, 2024 and December 29, 2023 was:

	June 28, 2024						December 29, 2023
	Principal Amount		Unamortized Deferred Costs and Premium		Net Amount		Principal Amount		Unamortized Deferred Costs and Premium		Net Amount
2028 Notes	$	287,500	$	(5,157)	$	282,343	$	287,500	$	(5,730)	$	281,770
2024 Notes	39,684		(93)		39,591		39,684		(185)		39,499
Total	$	327,184	$	(5,250)	$	321,934	$	327,184	$	(5,915)	$	321,269

Schedule of components of interest expense

The components of interest expense on the Company’s convertible notes were as follows:

	Thirteen Weeks Ended				Twenty-Six Weeks Ended
	June 28, 2024		June 30, 2023		June 28, 2024		June 30, 2023
Coupon interest	$	1,893	$	1,893	$	3,786	$	3,792
Amortization of deferred costs and premium	333		333		666		668
Total interest	$	2,226	$	2,226	$	4,452	$	4,460

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Stockholders' Equity (Tables)

6 Months Ended

Jun. 28, 2024

Stockholders' Equity Note [Abstract]

Schedule of restricted stock awards activity

The following table reflects the activity of RSAs and RSUs during the twenty-six weeks ended June 28, 2024:

	Time-based			Performance-based			Market-based
	Shares	Weighted Average Grant Date Fair Value		Shares	Weighted Average Grant Date Fair Value		Shares	Weighted Average Grant Date Fair Value
Unvested at December 29, 2023	461,752	$	32.13	1,078,169	$	32.88	421,056	$	30.00
Granted	248,934	37.86		313,188	38.53		55,270	34.68
Vested	(223,099)	31.80		(172,232)	32.07		(166,343)	31.43
Forfeited	(5,650)	34.03		(325,267)	33.48		(3,956)	31.00
Unvested at June 28, 2024	481,937	$	35.21	893,858	$	34.80	306,027	$	30.06

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Supplemental Disclosures of Cash Flow Information (Tables)

6 Months Ended

Jun. 28, 2024

Supplemental Cash Flow Elements [Abstract]

Schedule of supplemental disclosures of cash flow information

	Twenty-Six Weeks Ended
	June 28, 2024		June 30, 2023
Supplemental cash flow disclosures:
Cash paid for income taxes	$	6,016	$	10,673
Cash paid for interest, net of cash received	$	23,302	$	20,266
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	19,371	$	18,591
Operating cash flows from finance leases	$	895	$	336
ROU assets obtained in exchange for lease liabilities:
Operating leases	$	1,797	$	42,182
Finance leases	$	13,894	$	3,684
Non-cash investing and financing activities:
Common stock issued for acquisitions	$	—	$	2,496
Unsecured notes issued for acquisitions	$	—	$	10,000
Contingent earn-out liabilities for acquisitions	$	—	$	5,835

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Operations and Basis of Presentation - Narrative (Details)	6 Months Ended
	Jun. 28, 2024 segment
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Number of operating segments	3
Number of reportable segments	1

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Summary of Significant Accounting Policies - Schedule of Disaggregation of Revenue (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 28, 2024	Jun. 30, 2023	Jun. 28, 2024	Jun. 30, 2023
Disaggregation of Revenue [Line Items]
Net sales	$ 954,704	$ 881,820	$ 1,829,192	$ 1,601,465
Net Sales | Product Concentration Risk
Disaggregation of Revenue [Line Items]
Percentage of total net sales	100.00%	100.00%	100.00%	100.00%
Center-of-the-Plate
Disaggregation of Revenue [Line Items]
Net sales	$ 365,387	$ 338,390	$ 708,323	$ 646,311
Center-of-the-Plate | Net Sales | Product Concentration Risk
Disaggregation of Revenue [Line Items]
Percentage of total net sales	38.30%	38.40%	38.70%	40.40%
Total Specialty
Disaggregation of Revenue [Line Items]
Net sales	$ 589,317	$ 543,430	$ 1,120,869	$ 955,154
Total Specialty | Net Sales | Product Concentration Risk
Disaggregation of Revenue [Line Items]
Percentage of total net sales	61.70%	61.60%	61.30%	59.60%
Dry Goods
Disaggregation of Revenue [Line Items]
Net sales	$ 154,575	$ 137,985	$ 293,385	$ 261,325
Dry Goods | Net Sales | Product Concentration Risk
Disaggregation of Revenue [Line Items]
Percentage of total net sales	16.20%	15.60%	16.00%	16.30%
Produce
Disaggregation of Revenue [Line Items]
Net sales	$ 136,295	$ 124,766	$ 262,420	$ 172,553
Produce | Net Sales | Product Concentration Risk
Disaggregation of Revenue [Line Items]
Percentage of total net sales	14.30%	14.10%	14.30%	10.80%
Pastry
Disaggregation of Revenue [Line Items]
Net sales	$ 114,224	$ 108,143	$ 216,092	$ 198,252
Pastry | Net Sales | Product Concentration Risk
Disaggregation of Revenue [Line Items]
Percentage of total net sales	12.00%	12.30%	11.80%	12.40%
Cheese and Charcuterie
Disaggregation of Revenue [Line Items]
Net sales	$ 68,820	$ 64,947	$ 128,119	$ 120,664
Cheese and Charcuterie | Net Sales | Product Concentration Risk
Disaggregation of Revenue [Line Items]
Percentage of total net sales	7.20%	7.40%	7.00%	7.50%
Dairy and Eggs
Disaggregation of Revenue [Line Items]
Net sales	$ 62,674	$ 56,678	$ 120,800	$ 106,751
Dairy and Eggs | Net Sales | Product Concentration Risk
Disaggregation of Revenue [Line Items]
Percentage of total net sales	6.60%	6.40%	6.60%	6.70%
Oils and Vinegars
Disaggregation of Revenue [Line Items]
Net sales	$ 33,811	$ 33,131	$ 63,617	$ 62,510
Oils and Vinegars | Net Sales | Product Concentration Risk
Disaggregation of Revenue [Line Items]
Percentage of total net sales	3.50%	3.80%	3.50%	3.90%
Kitchen Supplies
Disaggregation of Revenue [Line Items]
Net sales	$ 18,918	$ 17,780	$ 36,436	$ 33,099
Kitchen Supplies | Net Sales | Product Concentration Risk
Disaggregation of Revenue [Line Items]
Percentage of total net sales	1.90%	2.00%	2.10%	2.00%

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Summary of Significant Accounting Policies - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 28, 2024	Jun. 30, 2023	Jun. 28, 2024	Jun. 30, 2023
Revenue from Contract with Customer [Abstract]
Cost of food processing	$ 18,277	$ 16,615	$ 37,347	$ 28,289

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Net Income per Share - Computation of Basic and Diluted Earnings per Share (Details) - $ / shares	3 Months Ended		6 Months Ended
	Jun. 28, 2024	Jun. 30, 2023	Jun. 28, 2024	Jun. 30, 2023
Net income per share:
Basic (in dollars per share)	$ 0.41	$ 0.26	$ 0.46	$ 0.30
Diluted (in dollars per share)	$ 0.37	$ 0.25	$ 0.44	$ 0.29
Weighted average common shares:
Basic (in shares)	37,924,931	37,634,127	37,871,080	37,570,595
Diluted (in shares)	45,947,728	45,604,297	45,959,061	38,201,408

XML

Net Income per Share - Schedule of Reconciliation of Earnings per Share (Details) - USD ($) $ in Thousands	3 Months Ended				6 Months Ended
	Jun. 28, 2024	Mar. 29, 2024	Jun. 30, 2023	Mar. 31, 2023	Jun. 28, 2024	Jun. 30, 2023
Numerator:
Net income	$ 15,524	$ 1,931	$ 9,867	$ 1,401	$ 17,455	$ 11,268
Add effect of dilutive securities
Interest on convertible notes, net of tax	1,322		1,397		2,628	0
Net income available to common shareholders	$ 16,846		$ 11,264		$ 20,083	$ 11,268
Denominator:
Weighted average basic common shares outstanding (in shares)	37,924,931		37,634,127		37,871,080	37,570,595
Dilutive effect of unvested common shares (in shares)	573,930		521,102		642,767	564,119
Dilutive effect of stock options and warrants (in shares)	56,050		56,251		52,397	66,694
Dilutive effect of convertible notes (in shares)	7,392,817		7,392,817		7,392,817	0
Weighted average diluted common shares outstanding (in shares)	45,947,728		45,604,297		45,959,061	38,201,408

XML

Net Income per Share - Schedule of Potentially Dilutive Securities Excluded from Calculation of Diluted Net Loss per Share (Details) - shares	3 Months Ended		6 Months Ended
	Jun. 28, 2024	Jun. 30, 2023	Jun. 28, 2024	Jun. 30, 2023
Restricted share awards (“RSAs”) and restricted stock units (“RSUs”)
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive shares (in shares)	160,273	46,746	286,769	29,717
Convertible notes
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive shares (in shares)	0	0	0	7,392,817

XML

Fair Value Measurements - Summary of Changes in Level 3 Contingent Consideration Liability (Details) $ in Thousands	6 Months Ended
	Jun. 28, 2024 USD ($)
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance at beginning of period	$ 9,765
Cash payments	(4,250)
Changes in fair value	(615)
Balance at end of period	$ 4,900

XML

Fair Value Measurements - Narrative (Details) - USD ($) $ in Thousands	Jun. 28, 2024	Dec. 29, 2023
Fair Value Disclosures [Abstract]
Long-term earn-out liabilities	$ 637	$ 50

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Fair Value Measurements - Summary of the Carrying Value and Fair Value of Convertible Subordinated Notes (Details) - USD ($) $ in Thousands	Jun. 28, 2024	Dec. 29, 2023
Senior Notes | Carrying Value | Level 1 | 2028 Convertible senior notes
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Convertible Notes	$ 287,500	$ 287,500
Senior Notes | Carrying Value | Level 3 | 2024 Convertible Senior Notes
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Convertible Notes	39,684	39,684
Senior Notes | Fair Value | Level 1 | 2028 Convertible senior notes
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Convertible Notes	318,047	277,354
Senior Notes | Fair Value | Level 3 | 2024 Convertible Senior Notes
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Convertible Notes	40,300	38,609
Unsecured Notes | Carrying Value | Level 2
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
GreenLeaf Note	5,000	10,000
Unsecured Notes | Fair Value | Level 2
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
GreenLeaf Note	$ 4,888	$ 9,991

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Acquisitions - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 28, 2024	Jun. 30, 2023	Jun. 28, 2024	Jun. 30, 2023
Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract]
Cash paid for acquisitions, net of cash acquired			$ 315	$ 119,580
Goodwill adjustments			656
Decrease in prepaid expenses and other current assets			341
Professional fees	$ 0	$ 1,385	$ 0	$ 2,628

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Acquisitions - Pro Forma Consolidated Statement of Operations Information (Details) - Other Acquisitions - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2023
Business Acquisition [Line Items]
Net sales	$ 892,161	$ 1,695,649
Income before income taxes	$ 13,617	$ 16,752

XML

Inventories - Narrative (Details) - USD ($) $ in Thousands	Jun. 28, 2024	Dec. 29, 2023
Inventory Disclosure [Abstract]
Reserves for shrinkage, excess and obsolescence	$ 12,157	$ 11,205

XML

Property and Equipment - Narrative (Details) - USD ($) $ in Thousands	Jun. 28, 2024	Dec. 29, 2023
Property, Plant and Equipment [Abstract]
Accumulated depreciation and amortization	$ 154,745	$ 137,008

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Goodwill and Other Intangible Assets - Goodwill (Details) $ in Thousands	6 Months Ended
	Jun. 28, 2024 USD ($)
Goodwill [Roll Forward]
Beginning balance	$ 356,021
Goodwill adjustments	656
Foreign currency translation	(146)
Ending balance	$ 356,531

XML

Goodwill and Other Intangible Assets - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 28, 2024	Jun. 30, 2023	Jun. 28, 2024	Jun. 30, 2023	Dec. 29, 2023
Goodwill and Intangible Assets Disclosure [Abstract]
Accumulated amortization	$ 145,002		$ 145,002		$ 132,660
Amortization expense	$ 6,171	$ 5,759	$ 12,342	$ 10,456
Intangible asset impairment, net of tax		$ 1,838		$ 1,333

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Debt Obligations - Schedule of Debt Obligations (Details) - USD ($) $ in Thousands	Jun. 28, 2024	Dec. 29, 2023
Debt Instrument [Line Items]
Finance leases and other financing obligations, weighted-average discount rate	6.48%
Finance leases and other financing obligations	$ 38,558	$ 31,892
Unamortized deferred costs and premium	(15,107)	(17,339)
Total debt obligations	717,385	717,987
Less: current installments	(56,626)	(53,185)
Total long-term debt	$ 660,759	664,802
Senior secured term loans | Senior secured term loans
Debt Instrument [Line Items]
Effective interest rate	10.10%
Long-term debt	$ 266,750	276,250
Convertible Debt
Debt Instrument [Line Items]
Long-term debt	327,184	327,184
Unamortized deferred costs and premium	$ (5,250)	(5,915)
Convertible Debt | 2028 Notes
Debt Instrument [Line Items]
Effective interest rate	2.77%
Long-term debt	$ 287,500	287,500
Unamortized deferred costs and premium	$ (5,157)	(5,730)
Convertible Debt | 2024 Notes
Debt Instrument [Line Items]
Effective interest rate	2.34%
Long-term debt	$ 39,684	39,684
Unamortized deferred costs and premium	$ (93)	(185)
Asset-based loan facility
Debt Instrument [Line Items]
Effective interest rate	7.47%
Long-term debt	$ 100,000	$ 100,000

XML

Debt Obligations - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 28, 2024	Jun. 28, 2024	Jun. 30, 2023
Debt Instrument [Line Items]
Loss on debt extinguishment		$ 366	$ 0
Eleventh amendment
Debt Instrument [Line Items]
Loss on debt extinguishment		50
Eleventh amendment | Senior secured term loans
Debt Instrument [Line Items]
Arrangement fees		775
Third-party transaction costs		91
Senior secured term loans | Senior secured term loans
Debt Instrument [Line Items]
Voluntary prepayment		8,000
Unamortized deferred financing fees written off	$ 77	316
GreenLeaf Note
Debt Instrument [Line Items]
Scheduled principal payment		$ 5,000

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Debt Obligations - Schedule of Convertible Senior Notes (Details) - USD ($) $ in Thousands	Jun. 28, 2024	Dec. 29, 2023
Debt Instrument [Line Items]
Deferred Costs and Premium	$ (15,107)	$ (17,339)
Convertible Debt
Debt Instrument [Line Items]
Principal Amount	327,184	327,184
Deferred Costs and Premium	(5,250)	(5,915)
Net Amount	321,934	321,269
Convertible Debt | 2028 Notes
Debt Instrument [Line Items]
Principal Amount	287,500	287,500
Deferred Costs and Premium	(5,157)	(5,730)
Net Amount	282,343	281,770
Convertible Debt | 2024 Notes
Debt Instrument [Line Items]
Principal Amount	39,684	39,684
Deferred Costs and Premium	(93)	(185)
Net Amount	$ 39,591	$ 39,499

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Debt Obligations - Schedule of Components of Interest Expense (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 28, 2024	Jun. 30, 2023	Jun. 28, 2024	Jun. 30, 2023
Debt Instrument [Line Items]
Amounts reserved for issuance of letters of credit	$ 29,377		$ 29,377
Convertible Debt
Debt Instrument [Line Items]
Coupon interest	1,893	$ 1,893	3,786	$ 3,792
Amortization of deferred costs and premium	333	333	666	668
Total interest	2,226	$ 2,226	4,452	$ 4,460
Senior secured term loans | Asset-based loan facility
Debt Instrument [Line Items]
Line of credit facility, current borrowing capacity	$ 170,623		$ 170,623

XML

Stockholders' Equity - Schedule of Restricted Stock Awards (Details)	6 Months Ended
	Jun. 28, 2024 $ / shares shares
Time-based
Shares
Unvested at beginning balance (in shares) | shares	461,752
Granted (in shares) | shares	248,934
Vested (in shares) | shares	(223,099)
Forfeited (in shares) | shares	(5,650)
Unvested at ending balance (in shares) | shares	481,937
Weighted Average Grant Date Fair Value
Unvested at beginning balance (in dollars per share) | $ / shares	$ 32.13
Granted (in dollars per share) | $ / shares	37.86
Vested (in dollars per share) | $ / shares	31.80
Forfeited (in dollars per share) | $ / shares	34.03
Unvested at ending balance (in dollars per share) | $ / shares	$ 35.21
Performance-based
Shares
Unvested at beginning balance (in shares) | shares	1,078,169
Granted (in shares) | shares	313,188
Vested (in shares) | shares	(172,232)
Forfeited (in shares) | shares	(325,267)
Unvested at ending balance (in shares) | shares	893,858
Weighted Average Grant Date Fair Value
Unvested at beginning balance (in dollars per share) | $ / shares	$ 32.88
Granted (in dollars per share) | $ / shares	38.53
Vested (in dollars per share) | $ / shares	32.07
Forfeited (in dollars per share) | $ / shares	33.48
Unvested at ending balance (in dollars per share) | $ / shares	$ 34.80
Market-based
Shares
Unvested at beginning balance (in shares) | shares	421,056
Granted (in shares) | shares	55,270
Vested (in shares) | shares	(166,343)
Forfeited (in shares) | shares	(3,956)
Unvested at ending balance (in shares) | shares	306,027
Weighted Average Grant Date Fair Value
Unvested at beginning balance (in dollars per share) | $ / shares	$ 30.00
Granted (in dollars per share) | $ / shares	34.68
Vested (in dollars per share) | $ / shares	31.43
Forfeited (in dollars per share) | $ / shares	31.00
Unvested at ending balance (in dollars per share) | $ / shares	$ 30.06

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Stockholders' Equity - Narrative (Details) - USD ($)	1 Months Ended	3 Months Ended		6 Months Ended
	Nov. 30, 2023	Jun. 28, 2024	Jun. 30, 2023	Jun. 28, 2024	Jun. 30, 2023	Dec. 29, 2023
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation expense, capitalized				$ 0
Share repurchase program, term (in years)	2 years
Share repurchase program, amount authorized	$ 100,000,000
Stock repurchase program, remaining authorized repurchase amount		$ 90,000,000		$ 90,000,000
Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share repurchase program, amount of shares targeted to be repurchased in the next twenty four months (in shares)						$ 100,000,000
Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share repurchase program, amount of shares targeted to be repurchased in the next twenty four months (in shares)	$ 25,000,000
Restricted Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares granted (in shares)				617,392
Weighted average grant date fair value (in dollars per share)				$ 37.91
Recognized expense		3,946,000	$ 4,704,000	$ 7,536,000	$ 9,494,000
Total unrecognized compensation cost, RSAs		27,702,000		$ 27,702,000
Weighted average remaining term (in years)				1 year 9 months 18 days
Time , Market, And Performance Based Grants | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period (in years)				5 years
Time-based
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares granted (in shares)				248,934
Weighted average grant date fair value (in dollars per share)				$ 37.86
Total unrecognized compensation cost, RSAs		14,525,000		$ 14,525,000
Weighted average remaining term (in years)				1 year 8 months 12 days
Performance-based
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares granted (in shares)				313,188
Weighted average grant date fair value (in dollars per share)				$ 38.53
Total unrecognized compensation cost, RSAs		$ 13,177,000		$ 13,177,000
Weighted average remaining term (in years)				2 years

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Related Parties - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 28, 2024	Jun. 30, 2023	Jun. 28, 2024	Jun. 30, 2023
Restructuring Cost and Reserve [Line Items]
Ownership interest in facilities owned by entities controlled by company's stockholders (as a percent)			100.00%
Leased Distribution Facility Owned by CEO
Restructuring Cost and Reserve [Line Items]
Expense related to affiliate distribution facility	$ 176	$ 123	$ 352	$ 246

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Income Taxes - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 28, 2024	Jun. 30, 2023	Jun. 28, 2024	Jun. 30, 2023
Income Tax Disclosure [Abstract]
Effective income tax rate (as a percent)	30.00%	26.00%	30.00%	26.00%
Income tax refund receivable	$ 25,244		$ 25,244

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Supplemental Disclosures of Cash Flow Information - Summary of Supplemental Cash Flow Disclosures (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 28, 2024	Jun. 30, 2023
Supplemental cash flow disclosures:
Cash paid for income taxes	$ 6,016	$ 10,673
Cash paid for interest, net of cash received	23,302	20,266
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	19,371	18,591
Operating cash flows from finance leases	895	336
ROU assets obtained in exchange for lease liabilities:
Operating leases	1,797	42,182
Finance leases	13,894	3,684
Non-cash investing and financing activities:
Common stock issued for acquisitions	0	2,496
Unsecured notes issued for acquisitions	0	10,000
Contingent earn-out liabilities for acquisitions	$ 0	$ 5,835