US Foods (USFD) Q3 2024 earnings summary

Executive summary

• Net sales rose 6.8% year-over-year to $9.73 billion in Q3 2024, with gross profit up 8.1% to $1.7 billion and adjusted EBITDA up 13.2% to $455 million, despite macroeconomic and weather-related challenges.

• Net income increased 56% to $148 million, and adjusted diluted EPS rose 21.4% to $0.85.

• Achieved 14th consecutive quarter of market share gains, with total case volume up 3.8% and independent restaurant case volume up 4.1%.

• Pronto small truck delivery service expanded to 40 markets, targeting $700 million in annualized sales.

• Accelerated share repurchases, with $580 million in Q3 and $1.1 billion since late 2022, and continued focus on digital innovation and cost management.

Financial highlights

• Q3 2024 net sales: $9.73 billion (+6.8%); adjusted EBITDA: $455 million (+13.2%); adjusted EBITDA margin: 4.7% (+27 bps); adjusted diluted EPS: $0.85 (+21.4%).

• Gross profit increased 8.1% to $1.67 billion; gross margin improved to 17.1%.

• Year-to-date net sales: $28.39 billion (+6.5%); adjusted EBITDA: $1.3 billion (+11%); adjusted diluted EPS: $2.32 (+16.6%).

• Free cash flow for 39 weeks: $658 million; cash from operations: $891 million.

• Adjusted gross profit per case increased by $0.24 (over 3%); adjusted operating expense per case rose by $0.04 (less than 1%).

Outlook and guidance

• FY 2024 net sales guidance: $37.7–$38.5 billion; adjusted EBITDA: $1.72–$1.74 billion; adjusted diluted EPS: $3.05–$3.20.

• Total case growth for 2024 forecasted at 4–6%; sales inflation (including mix) at 1–2.5%.

• Capital expenditures for FY24 expected between $325 million and $375 million.

• Interest expense projected at $310–$320 million; depreciation and amortization at $435–$445 million; tax rate ~26%.

• Long-term targets (2025E–2027E): ~5% net sales CAGR, 10% adjusted EBITDA CAGR, 20bps+ annual adjusted EBITDA margin expansion.