The Chefs' Warehouse (CHEF) Q2 2024 earnings summary

Executive summary

• Net sales for Q2 2024 increased 8.3% year-over-year to $954.7 million, driven by organic growth and acquisitions, with strong customer and item placement growth across domestic and international markets.

• GAAP net income rose to $15.5 million ($0.37 per diluted share), up from $9.9 million ($0.25) in Q2 2023, with adjusted net income per share at $0.40.

• Gross profit margin improved to 24.0%, up 35 basis points year-over-year, with gross profit at $229 million.

• Unique customer growth was 8.2%, specialty sales up 7.5% organically, and specialty case growth 4.7%.

• Share repurchases totaled $10 million in the first half of 2024.

Financial highlights

• Net sales for the first half of 2024 were $1.83 billion, up 14.2% year-over-year.

• Operating income for Q2 2024 was $33.9 million, up from $25.3 million in Q2 2023.

• Adjusted EBITDA reached $56.2 million, up from $51.1 million, and adjusted net income was $17 million ($0.40 per share).

• Interest expense for Q2 2024 was $11.7 million, down 2.6% year-over-year.

• Effective tax rate increased to 30.0% from 26.0% in the prior year quarter.

Outlook and guidance

• Full-year 2024 guidance: net sales of $3.665–$3.785 billion, gross profit of $874–$902 million, and adjusted EBITDA of $208–$219 million.

• Organic revenue growth is expected to moderate to 6–7% for the full year, reflecting tougher year-over-year comparisons.

• Capital expenditures for fiscal 2024 are expected to be $40–$45 million, excluding acquisitions.

• Management believes current liquidity and credit facilities are sufficient for the next twelve months.

• Fully diluted share count expected to be 45.9 million in Q3 and 45 million in Q4 and full-year 2024.