Delaware
|
001-37786
|
26-0347906
|
||
(State or Other
Jurisdiction of
Incorporation)
|
(Commission File
Number)
|
(I.R.S. Employer
Identification No.)
|
9399 W. Higgins Road, Suite 500
Rosemont, Illinois 60018 |
||
(Address of principal executive office)
|
||
(847) 720-8000
(Registrant’s telephone number, including area code)
|
US FOODS HOLDING CORP.
|
|||
Date: July 30, 2018
|
By:
|
/s/ Dirk Locascio | |
Name: Dirk Locascio | |||
Title: Chief Financial Officer | |||
Exhibit No.
|
|
Description of Exhibit
|
99.1
|
Press Release, dated July 30, 2018.
|
INVESTOR CONTACT:
|
MEDIA CONTACT:
|
Melissa Napier
|
Sara Matheu
|
(847) 720-2767
|
(847) 720-2392
|
Melissa.Napier@usfoods.com
|
Sara.Matheu@usfoods.com
|
●
|
Total case volume decreased 0.9%; independent restaurant case volume increased 3.8%
|
|
●
|
Net sales of $6.2 billion were flat compared to prior year
|
|
●
|
Gross profit of $1.1 billion increased 5.7%
|
|
●
|
Income before income taxes increased $76 million to $161 million
|
|
●
|
Net income increased $61 million to $126 million
|
|
●
|
Adjusted EBITDA increased 4.9% to $300 million
|
|
●
|
Diluted EPS of $0.58; Adjusted Diluted EPS of $0.57
|
●
|
Total case volume decreased 1.6%; independent restaurant case volume increased 4.0%
|
|
●
|
Net sales increased 0.3% to $12.0 billion
|
|
●
|
Gross profit of $2.1 billion increased 3.0%
|
|
●
|
Income before income taxes increased $104 million to $223 million
|
|
●
|
Net income increased $101 million to $193 million
|
|
●
|
Adjusted EBITDA increased 4.4% to $523 million
|
|
●
|
Diluted EPS of $0.89; Adjusted Diluted EPS of $0.92
|
($ in millions) *
|
June 30, 2018
|
December 30, 2017
|
||||||
(Unaudited)
|
||||||||
ASSETS
|
||||||||
Current assets
|
||||||||
Cash and cash equivalents
|
$
|
100
|
$
|
119
|
||||
Accounts receivable, less allowances of $27 and $26
|
1,339
|
1,302
|
||||||
Vendor receivables, less allowances of $3
|
141
|
97
|
||||||
Inventories—net
|
1,208
|
1,208
|
||||||
Prepaid expenses
|
96
|
80
|
||||||
Assets held for sale
|
5
|
5
|
||||||
Other current assets
|
23
|
8
|
||||||
Total current assets
|
2,913
|
2,819
|
||||||
Property and equipment—net
|
1,823
|
1,801
|
||||||
Goodwill
|
3,967
|
3,967
|
||||||
Other intangibles—net
|
344
|
364
|
||||||
Deferred tax assets
|
12
|
22
|
||||||
Other assets
|
77
|
65
|
||||||
Total assets
|
$
|
9,135
|
$
|
9,037
|
||||
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
||||||||
Current liabilities:
|
||||||||
Bank checks outstanding
|
$
|
147
|
$
|
154
|
||||
Accounts payable
|
1,454
|
1,289
|
||||||
Accrued expenses and other current liabilities
|
397
|
451
|
||||||
Current portion of long-term debt
|
101
|
109
|
||||||
Total current liabilities
|
2,100
|
2,003
|
||||||
Long term debt
|
3,498
|
3,648
|
||||||
Deferred tax liabilities
|
305
|
263
|
||||||
Other long-term liabilities
|
212
|
372
|
||||||
Total liabilities
|
6,115
|
6,286
|
||||||
Shareholders’ equity:
|
||||||||
Common stock
|
2
|
2
|
||||||
Additional paid-in capital
|
2,759
|
2,721
|
||||||
Retained earnings
|
316
|
124
|
||||||
Accumulated other comprehensive loss
|
(57
|
)
|
(96
|
)
|
||||
Total shareholders’ equity
|
3,020
|
2,751
|
||||||
Total liabilities and shareholders’ equity
|
$
|
9,135
|
$
|
9,037
|
13–Weeks Ended
|
26–Weeks Ended
|
|||||||||||||||
($ in millions, except share and per share data) *
|
June 30, 2018
|
July 1, 2017
|
June 30, 2018
|
July 1, 2017
|
||||||||||||
Net sales
|
$
|
6,158
|
$
|
6,159
|
$
|
11,981
|
$
|
11,947
|
||||||||
Cost of goods sold
|
5,045
|
5,105
|
9,875
|
9,902
|
||||||||||||
Gross profit
|
1,114
|
1,054
|
2,106
|
2,045
|
||||||||||||
Distribution, selling and administrative costs
|
908
|
926
|
1,797
|
1,840
|
||||||||||||
Restructuring charges
|
—
|
1
|
1
|
3
|
||||||||||||
Total operating expenses
|
908
|
927
|
1,798
|
1,843
|
||||||||||||
Operating income
|
205
|
127
|
308
|
203
|
||||||||||||
Other (income) expense—net
|
(3
|
)
|
1
|
(6
|
)
|
1
|
||||||||||
Interest expense—net
|
48
|
41
|
91
|
83
|
||||||||||||
Income before income taxes
|
161
|
85
|
223
|
119
|
||||||||||||
Income tax provision
|
35
|
19
|
30
|
27
|
||||||||||||
Net income
|
$
|
126
|
$
|
65
|
$
|
193
|
$
|
92
|
||||||||
Net income per share
|
||||||||||||||||
Basic
|
$
|
0.58
|
$
|
0.29
|
$
|
0.90
|
$
|
0.42
|
||||||||
Diluted
|
$
|
0.58
|
$
|
0.29
|
$
|
0.89
|
$
|
0.41
|
||||||||
Weighted-average common shares outstanding
|
||||||||||||||||
Basic
|
215,827,074
|
222,754,030
|
215,453,656
|
222,059,022
|
||||||||||||
Diluted
|
217,770,313
|
226,791,449
|
217,491,267
|
226,557,430
|
26–Weeks Ended
|
||||||||
($ in millions) *
|
June 30, 2018
|
July 1, 2017
|
||||||
Cash Flows From Operating Activities:
|
||||||||
Net income
|
$
|
193
|
$
|
92
|
||||
Adjustments to reconcile net income to net cash provided by
|
||||||||
operating activities:
|
||||||||
Depreciation and amortization
|
165
|
214
|
||||||
Gain on disposal of property and equipment—net
|
(1
|
)
|
—
|
|||||
Amortization and write-off of deferred financing costs
|
5
|
2
|
||||||
Deferred tax provision
|
38
|
18
|
||||||
Share-based compensation expense
|
17
|
9
|
||||||
Provision for doubtful accounts
|
9
|
9
|
||||||
Changes in operating assets and liabilities, net of business acquisitions:
|
||||||||
Increase in receivables
|
(98
|
)
|
(189
|
)
|
||||
Decrease in inventories
|
—
|
4
|
||||||
Increase in prepaid expenses and other assets
|
(19
|
)
|
(21
|
)
|
||||
Increase in accounts payable and bank checks outstanding
|
175
|
276
|
||||||
Decrease in accrued expenses and other liabilities
|
(173
|
)
|
(47
|
)
|
||||
Net cash provided by operating activities
|
311
|
368
|
||||||
Cash Flows From Investing Activities:
|
||||||||
Acquisition of businesses—net of cash
|
—
|
(135
|
)
|
|||||
Proceeds from sales of property and equipment
|
2
|
2
|
||||||
Purchases of property and equipment
|
(117
|
)
|
(108
|
)
|
||||
Proceeds from from redemption of industrial revenue bonds
|
—
|
22
|
||||||
Net cash used in investing activities
|
(116
|
)
|
(219
|
)
|
||||
Cash Flows From Financing Activities:
|
||||||||
Proceeds from debt borrowings
|
2,151
|
1,117
|
||||||
Principal payments on debt and capital leases
|
(2,382
|
)
|
(1,213
|
)
|
||||
Redemption of industrial revenue bonds
|
—
|
(22
|
)
|
|||||
Contingent consideration paid for business acquisitions
|
(2
|
)
|
(5
|
)
|
||||
Proceeds from employee share purchase plan
|
10
|
8
|
||||||
Proceeds from exercise of stock options
|
16
|
11
|
||||||
Tax withholding payments for net share-settled equity awards
|
(6
|
)
|
(26
|
)
|
||||
Net cash used in financing activities
|
(214
|
)
|
(131
|
)
|
||||
Net (decrease) increase in cash and cash equivalents
|
(19
|
)
|
19
|
|||||
Cash, cash equivalents and restricted cash—beginning of period (1)
|
119
|
131
|
||||||
Cash, cash equivalents and restricted cash—end of period(1)
|
$
|
101
|
$
|
150
|
||||
Supplemental disclosures of cash flow information:
|
||||||||
Cash paid during the period for:
|
||||||||
Interest (net of amounts capitalized)
|
$
|
88
|
$
|
79
|
||||
Income taxes paid—net
|
42
|
3
|
||||||
Non-cash Investing and Financing Activities:
|
||||||||
Property and equipment purchases included in accounts payable
|
13
|
17
|
||||||
Capital lease additions
|
68
|
61
|
||||||
Cashless exercise of equity awards
|
1
|
26
|
||||||
Contingent consideration payable for business acquisitions
|
—
|
4
|
13-Weeks Ended
|
||||||||||||||||
($ in millions, except share and per share data) *
|
June 30, 2018
|
July 1, 2017
|
Change
|
%
|
||||||||||||
Net income (GAAP)
|
$
|
126
|
$
|
65
|
$
|
61
|
93.8
|
%
|
||||||||
Interest expense—net
|
48
|
41
|
7
|
17.1
|
%
|
|||||||||||
Income tax provision
|
35
|
19
|
16
|
84.2
|
%
|
|||||||||||
Depreciation and amortization expense
|
84
|
106
|
(22
|
)
|
(20.8
|
)%
|
||||||||||
EBITDA (Non-GAAP)
|
293
|
232
|
61
|
26.3
|
%
|
|||||||||||
Adjustments:
|
||||||||||||||||
Restructuring charges (1)
|
—
|
1
|
(1
|
)
|
(100.0
|
)%
|
||||||||||
Share-based compensation expense (2)
|
10
|
5
|
5
|
100.0
|
%
|
|||||||||||
LIFO reserve change (3)
|
(11
|
)
|
30
|
(41
|
)
|
(136.7
|
)%
|
|||||||||
Business transformation costs (4)
|
7
|
13
|
(6
|
)
|
(46.2
|
)%
|
||||||||||
Other (5)
|
1
|
5
|
(4
|
)
|
(80.0
|
)%
|
||||||||||
Adjusted EBITDA (Non-GAAP)
|
300
|
286
|
14
|
4.9
|
%
|
|||||||||||
Depreciation and amortization expense
|
(84
|
)
|
(106
|
)
|
22
|
(20.8
|
)%
|
|||||||||
Interest expense—net
|
(48
|
)
|
(41
|
)
|
(7
|
)
|
17.1
|
%
|
||||||||
Income tax provision, as adjusted (6)
|
(43
|
)
|
(54
|
)
|
11
|
(20.4
|
)%
|
|||||||||
Adjusted Net income (Non-GAAP)
|
$
|
124
|
$
|
85
|
$
|
39
|
45.9
|
%
|
||||||||
Diluted EPS (GAAP)
|
$
|
0.58
|
$
|
0.29
|
$
|
0.29
|
100.0
|
%
|
||||||||
Restructuring charges (1)
|
—
|
—
|
—
|
NM
|
||||||||||||
Share-based compensation expense (2)
|
0.05
|
0.02
|
0.03
|
150.0
|
%
|
|||||||||||
LIFO reserve change (3)
|
(0.05
|
)
|
0.13
|
(0.18
|
)
|
(138.5
|
)%
|
|||||||||
Business transformation costs (4)
|
0.03
|
0.06
|
(0.03
|
)
|
(50.0
|
)%
|
||||||||||
Other (5)
|
—
|
0.02
|
(0.02
|
)
|
(100.0
|
)%
|
||||||||||
Income tax impact of adjustments (6)
|
(0.04
|
)
|
(0.15
|
)
|
0.11
|
(73.3
|
)%
|
|||||||||
Adjusted Diluted EPS (Non-GAAP)
|
$
|
0.57
|
$
|
0.37
|
$
|
0.20
|
54.1
|
%
|
||||||||
Weighted-average diluted shares outstanding (GAAP)
|
217,770,313
|
226,791,449
|
||||||||||||||
Gross profit (GAAP)
|
$
|
1,114
|
$
|
1,054
|
$
|
60
|
5.7
|
%
|
||||||||
LIFO reserve change (3)
|
(11
|
)
|
30
|
(41
|
)
|
(136.7
|
)%
|
|||||||||
Adjusted Gross profit (Non-GAAP)
|
$
|
1,103
|
$
|
1,084
|
$
|
19
|
1.8
|
%
|
||||||||
Operating expenses (GAAP)
|
$
|
908
|
$
|
927
|
$
|
(19
|
)
|
(2.0
|
)%
|
|||||||
Depreciation and amortization expense
|
(84
|
)
|
(106
|
)
|
22
|
(20.8
|
)%
|
|||||||||
Restructuring charges (1)
|
—
|
(1
|
)
|
1
|
(100.0
|
)%
|
||||||||||
Share-based compensation expense (2)
|
(10
|
)
|
(5
|
)
|
(5
|
)
|
100.0
|
%
|
||||||||
Business transformation costs (4)
|
(7
|
)
|
(13
|
)
|
6
|
(46.2
|
)%
|
|||||||||
Other (5)
|
(1
|
)
|
(5
|
)
|
4
|
(80.0
|
)%
|
|||||||||
Adjusted Operating expenses (Non-GAAP)
|
$
|
806
|
$
|
798
|
$
|
8
|
1.0
|
%
|
(1) |
Consists primarily of severance and related costs and organizational realignment costs.
|
(2) |
Share-based compensation expense for vesting of stock awards and share purchase plan.
|
(3) |
Represents the non-cash impact of LIFO reserve adjustments.
|
(4) |
Consists primarily of costs related to significant process and systems redesign across multiple functions.
|
(5) |
Other includes gains, losses or charges as specified under our debt agreements.
|
(6) |
Represents our income tax provision adjusted for the tax effect of pre-tax items excluded from Adjusted Net income and the removal of applicable discrete tax items. Applicable discrete tax items include changes in tax laws or rates, changes related to prior year unrecognized tax benefits, discrete changes in valuation allowances, and excess tax benefits associated with share-based compensation. The tax effect of pre-tax items excluded from Adjusted net income is computed using a statutory tax rate after considering the impact of permanent differences and valuation allowances.
|
26–Weeks Ended
|
||||||||||||||||
($ in millions, except share and per share data) *
|
June 30, 2018
|
July 1, 2017
|
Change
|
%
|
||||||||||||
Net income (GAAP)
|
$
|
193
|
$
|
92
|
$
|
101
|
109.8
|
%
|
||||||||
Interest expense—net
|
91
|
83
|
8
|
9.6
|
%
|
|||||||||||
Income tax provision
|
30
|
27
|
3
|
11.1
|
%
|
|||||||||||
Depreciation and amortization expense
|
165
|
214
|
(49
|
)
|
(22.9
|
)%
|
||||||||||
EBITDA (Non-GAAP)
|
480
|
416
|
64
|
15.4
|
%
|
|||||||||||
Adjustments:
|
||||||||||||||||
Restructuring charges (1)
|
1
|
3
|
(2
|
)
|
(66.7
|
)%
|
||||||||||
Share-based compensation expense (2)
|
17
|
9
|
8
|
88.9
|
%
|
|||||||||||
LIFO reserve change (3)
|
8
|
40
|
(32
|
)
|
(80.0
|
)%
|
||||||||||
Business transformation costs (4)
|
15
|
27
|
(12
|
)
|
(44.4
|
)%
|
||||||||||
Other (5)
|
3
|
7
|
(4
|
)
|
(57.1
|
)%
|
||||||||||
Adjusted EBITDA (Non-GAAP)
|
523
|
501
|
22
|
4.4
|
%
|
|||||||||||
Depreciation and amortization expense
|
(165
|
)
|
(214
|
)
|
49
|
(22.9
|
)%
|
|||||||||
Interest expense—net
|
(91
|
)
|
(83
|
)
|
(8
|
)
|
9.6
|
%
|
||||||||
Income tax provision, as adjusted (6)
|
(68
|
)
|
(79
|
)
|
11
|
(13.9
|
)%
|
|||||||||
Adjusted Net income (Non-GAAP)
|
$
|
199
|
$
|
125
|
$
|
74
|
59.2
|
%
|
||||||||
Diluted EPS (GAAP)
|
$
|
0.89
|
$
|
0.41
|
$
|
0.48
|
117.1
|
%
|
||||||||
Restructuring charges (1)
|
—
|
0.01
|
(0.01
|
)
|
(100.0
|
)%
|
||||||||||
Share-based compensation expense (2)
|
0.08
|
0.04
|
0.04
|
100.0
|
%
|
|||||||||||
LIFO reserve change (3)
|
0.04
|
0.18
|
(0.14
|
)
|
(77.8
|
)%
|
||||||||||
Business transformation costs (4)
|
0.07
|
0.12
|
(0.05
|
)
|
(41.7
|
)%
|
||||||||||
Other (5)
|
0.01
|
0.03
|
(0.02
|
)
|
(66.7
|
)%
|
||||||||||
Income tax impact of adjustments (6)
|
(0.17
|
)
|
(0.23
|
)
|
0.06
|
(26.1
|
)%
|
|||||||||
Adjusted Diluted EPS (Non-GAAP)
|
$
|
0.92
|
$
|
0.56
|
$
|
0.36
|
64.3
|
%
|
||||||||
Weighted-average diluted shares outstanding (GAAP)
|
217,491,267
|
226,557,430
|
||||||||||||||
Gross profit (GAAP)
|
$
|
2,106
|
$
|
2,045
|
$
|
61
|
3.0
|
%
|
||||||||
LIFO reserve change (3)
|
8
|
40
|
(32
|
)
|
(80.0
|
)%
|
||||||||||
Adjusted Gross profit (Non-GAAP)
|
$
|
2,114
|
$
|
2,085
|
$
|
29
|
1.4
|
%
|
||||||||
Operating expenses (GAAP)
|
$
|
1,798
|
$
|
1,843
|
$
|
(45
|
)
|
(2.4
|
)%
|
|||||||
Depreciation and amortization expense
|
(165
|
)
|
(214
|
)
|
49
|
(22.9
|
)%
|
|||||||||
Restructuring charges (1)
|
(1
|
)
|
(3
|
)
|
2
|
(66.7
|
)%
|
|||||||||
Share-based compensation expense (2)
|
(17
|
)
|
(9
|
)
|
(8
|
)
|
88.9
|
%
|
||||||||
Business transformation costs (4)
|
(15
|
)
|
(27
|
)
|
12
|
(44.4
|
)%
|
|||||||||
Other (5)
|
(3
|
)
|
(7
|
)
|
4
|
(57.1
|
)%
|
|||||||||
Adjusted Operating expenses (Non-GAAP)
|
$
|
1,596
|
$
|
1,585
|
$
|
11
|
0.7
|
%
|
(1) |
Consists primarily of severance and related costs and organizational realignment costs.
|
(2) |
Share-based compensation expense for vesting of stock awards and share purchase plan.
|
(3) |
Represents the non-cash impact of LIFO reserve adjustments.
|
(4) |
Consists primarily of costs related to significant process and systems redesign across multiple functions.
|
(5) |
Other includes gains, losses or charges as specified under our debt agreements.
|
(6) |
Represents our income tax provision adjusted for the tax effect of pre-tax items excluded from Adjusted Net income and the removal of applicable discrete tax items. Applicable discrete tax items include changes in tax laws or rates, changes related to prior year unrecognized tax benefits, discrete changes in valuation allowances, and excess tax benefits associated with share-based compensation. The tax effect of pre-tax items excluded from Adjusted net income is computed using a statutory tax rate after considering the impact of permanent differences and valuation allowances.
|
($ in millions, except ratios) *
|
June 30, 2018
|
December 30, 2017
|
July 1, 2017
|
|||||||||
Total Debt (GAAP)
|
$
|
3,599
|
$
|
3,757
|
$
|
3,727
|
||||||
Cash, cash equivalents and restricted cash
|
(101
|
)
|
(119
|
)
|
(150
|
)
|
||||||
Net Debt (Non-GAAP)
|
$
|
3,498
|
$
|
3,638
|
$
|
3,577
|
||||||
Adjusted EBITDA (1)
|
$
|
1,080
|
$
|
1,058
|
$
|
1,010
|
||||||
Net Leverage Ratio (2)
|
3.2
|
3.4
|
3.5
|