PFGC Q4 Earnings Miss on Higher Fuel Costs, Sales Increase Y/Y

The company posted adjusted earnings of $1.59 per share, up 2.6% from $1.55 in the prior-year quarter. The figure missed the Zacks Consensus Estimate of $1.62. Higher fuel expenses and costs associated with the Cheney Brothers facility transition weighed on operating performance.

Net sales increased 6.4% year over year to $18,028.9 million from $16,938.9 million but missed the Zacks Consensus Estimate of $18,214 million. Organic independent Foodservice case volume increased 5.8% year over year, reflecting continued gains with independent customers.

PFGC's Profitability & Cost Performance

Gross profit increased 8.3% year over year to $2,168.8 million from $2,002.2 million. Growth reflected favorable case mix, including greater independent-channel business, recent acquisitions and vendor rebates and promotional incentives.

Operating expenses increased 6.4% to $1,845 million from $1,734.4 million a year ago. The increase stemmed from recent acquisitions, higher fuel prices and miles driven, increased wages and commissions and greater depreciation and amortization expense.

Operating profit climbed 20.9% to $323.8 million from $267.8 million. Adjusted EBITDA rose 7.4% to $587.5 million from $546.9 million in the year-ago quarter.

PFGC's Foodservice Segment Advances

Foodservice net sales increased 6.8% to $9,815.6 million from $9,191.5 million in the prior-year quarter, missing the Zacks Consensus Estimate of $9,856 million. Growth was driven primarily by recent acquisitions, higher selling prices and organic case-volume growth. Independent customers remained an important contributor, with organic independent case volume rising 5.8%.

Foodservice adjusted EBITDA increased 2.2% year over year to $395.5 million from $386.9 million. Gross-profit growth was partly offset by higher personnel, acquisition-related, fuel and insurance expenses.

Performance Food Group's Convenience Strength

Convenience net sales rose 5.7% to $6,805.8 million from $6,436.3 million in the year-ago period. The metric missed the Zacks Consensus Estimate of $6,887 million. Growth primarily reflected higher case volume from new chain customers and inflation in selling prices, partly offset by a shift from cigarettes toward alternative nicotine products.

Convenience adjusted EBITDA increased 10.4% to $132.5 million from $120 million. The improvement reflected higher gross profit from vendor rebates and promotional incentives, case growth and manufacturer distribution income, partly offset by higher operating expenses.

PFGC's Specialty & Corporate Segment Results

Specialty net sales increased 6.6% to $1,336.7 million from $1,253.5 million, surpassing the Zacks Consensus Estimate of $1,300 million. Higher selling prices, increased cases sold and favorable channel mix supported sales. Specialty adjusted EBITDA slipped 0.5% to $92.7 million from $93.2 million as higher operating expenses more than offset gross-profit growth.

Corporate & All Other net sales increased 7.8% to $276.9 million from $256.9 million in the prior-year quarter, surpassing the Zacks Consensus Estimate of $271 million. Corporate & All Other adjusted EBITDA was a loss of $33.2 million compared with $53.2 million a year earlier.

PFGC’s Financial Position

For fiscal 2026, operating cash flow increased to $1,413.7 million from $1,210.1 million in fiscal 2025. Capital expenditures decreased to $384.1 million from $506 million in fiscal 2025, helping free cash flow rise to $1,029.6 million from $704.1 million. Cash increased to $92.4 million from $78.5 million, while long-term debt declined to $5,006.8 million from $5,388.8 million.

Performance Food Group's Outlook

For the fiscal first quarter of 2027, the company expects net sales in the range of $17.9 billion to $18.1 billion and adjusted EBITDA of $510 million to $530 million. EBITDA growth is expected to accelerate through the fiscal year, supported by new business wins, procurement efficiency initiatives and continued progress on cost synergies from M&A activities.

For fiscal 2027, the company targets sales of $72.5 billion to $73 billion and adjusted EBITDA of $2.125 billion to $2.225 billion. The outlook includes a 53rd week, expected to benefit results by approximately 2%. At the midpoint, sales and adjusted EBITDA are projected to grow 7.2% and 12.7%, respectively, keeping the company on track toward its fiscal 2028 targets.

Shares of this Zacks Rank #3 (Hold) company have risen 9.6% over the past six months compared with the industry’s growth of 17.5%.

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Stocks to Consider

Some better-ranked stocks have been discussed below:

Darling Ingredients Inc. DAR develops, produces, and sells sustainable natural ingredients from edible and inedible bio-nutrients in North America, Europe, China, South America, and internationally. DAR currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for DAR’s current fiscal-year sales and earnings implies growth of 12.8% and 926.5%, respectively, from the year-ago actuals. DAR delivered a trailing four-quarter negative earnings surprise of 38.9%, on average.

The Chef’s Warehouse, Inc. CHEF distributes specialty food and center-of-the-plate products in the United States, the Middle East, and Canada. CHEF currently sports a Zacks Rank #1.

The Zacks Consensus Estimate for CHEF’s current fiscal-year sales and earnings indicates growth of 10.6% and 24.7%, respectively, from the year-ago reported figures. CHEF delivered a trailing four-quarter earnings surprise of 30.4%, on average.

US Foods Holding Corporation USFD, together with its subsidiaries, markets, sells and distributes fresh, frozen, and dry food and non-food products to foodservice customers in the United States. USFD currently carries a Zacks Rank #2 (Buy).

The Zacks Consensus Estimate for US Foods’ current fiscal-year sales and earnings implies growth of 5.1% and 16.3%, respectively, from the year-ago actuals. USFD delivered a trailing four-quarter earnings surprise of 1.5%, on average.

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