Investor Days22.q4cdn.com/.../doc_presentations/2017-pfg...day.pdf · the fiscal year ended July 1,...
Transcript of Investor Days22.q4cdn.com/.../doc_presentations/2017-pfg...day.pdf · the fiscal year ended July 1,...
Investor Day
September 12, 2017
Welcome Michael Neese, VP Investor Relations
1
Agenda I. Michael Neese VP Investor Relations, PFG Corporate
II. George Holm President and CEO, PFG Corporate
III. Dave Flitman President and CEO, Performance Foodservice
IV. Fred Sanelli SVP Marketing & Sales, Performance Foodservice
V. Jim Hope EVP Operations, PFG Corporate / Specialty
VI. Craig Hoskins President and CEO, PFG Customized Distribution
VII. Patrick Hagerty President and CEO, Vistar
VIII. Tom Ondrof EVP and CFO, PFG Corporate
IX. Q&A Leadership Team
2
Forward-Looking Statements • This presentation includes, and our response to various questions may include, certain
forward‐looking statements, estimates, and projections with respect to our anticipated future performance, including the statements in the “Fiscal 2018 Outlook” section of this presentation (collectively, “Forward‐Looking Statements”). Words such as “estimates,” “expects,” “contemplates,” “anticipates,” “projects,” “plans,” “intends,” “believes,” “forecasts,” “may,” “could,” “should,” and variations of such words or similar expressions are intended to identify Forward‐Looking Statements.
• Forward‐Looking Statements reflect various assumptions of the Company’s management that may or may not prove to be correct and are not guarantees of the Company’s future performance or results. The Company’s actual results could differ materially from those anticipated in the Forward‐Looking Statements.
• These Forward‐Looking Statements are subject to various risks and uncertainties, including those described in the “Item 1A. Risk Factors” section in our Annual Report on Form 10-K for the fiscal year ended July 1, 2017, which was filed with the Securities and Exchange Commission (the “SEC”) on August 25, 2017, as such factors may be updated from time to time in the Company’s periodic filings with the SEC, which are accessible on the SEC’s website at www.sec.gov.
• The Company is not required and does not intend to update or alter any Forward‐Looking Statements in this presentation or any other information that may be furnished to any recipient, whether as a result of new information, future events, or otherwise.
3
Non-GAAP Financial Measures • This presentation and the accompanying financial statement tables include several financial measures that are not
calculated in accordance with GAAP, including EBITDA, Adjusted EBITDA, and Adjusted Diluted Earnings per Share. Such measures are not recognized terms under GAAP, should not be considered in isolation or as a substitute for measures prepared in accordance with GAAP, and are not indicative of net income as determined under GAAP. EBITDA, Adjusted EBITDA, Adjusted Diluted Earnings per Share, and other non-GAAP financial measures have limitations that should be considered before using these measures to evaluate the Company’s liquidity or financial performance. EBITDA, Adjusted EBITDA, and Adjusted Diluted Earnings per Share, as presented, may not be comparable to similarly titled measures of other companies because of varying methods of calculation.
• Management measures operating performance based on PFG’s EBITDA, defined as net income before interest expense, interest income, income taxes, and depreciation and amortization.
• PFG believes that the presentation of EBITDA enhances an investor’s understanding of PFG’s performance. PFG believes this measure is a useful metric to assess PFG’s operating performance from period to period by excluding certain items that PFG believes are not representative of PFG’s core business. PFG uses this measure to evaluate the performance of its segments and for business planning purposes.
• In addition, management uses Adjusted EBITDA, defined as net income before interest expense, interest income, income and franchise taxes, and depreciation and amortization, further adjusted to exclude certain items we do not consider part of our core operating results. Such adjustments include certain unusual, non-cash, non-recurring, cost reduction, and other adjustment items permitted in calculating covenant compliance under the company’s credit and indenture agreements (other than certain pro forma adjustments permitted under our credit agreement and indenture relating to the Adjusted EBITDA contribution of acquired entities or businesses prior to the acquisition date). Under PFG’s credit agreement and indenture, the Company’s ability to engage in certain activities such as incurring certain additional indebtedness, making certain investments, and making restricted payments is tied to ratios based on Adjusted EBITDA (as defined in the credit agreement and indenture).
• Management also uses Adjusted Diluted Earnings per Share, which is calculated by adjusting the most directly comparable GAAP financial measure by excluding the same items excluded in PFG’s calculation of Adjusted EBITDA to the extent that each such item was included in the applicable GAAP financial measure.
• PFG believes that the presentation of Adjusted EBITDA and Adjusted Diluted Earnings per Share is useful to investors because these metrics are frequently used by securities analysts, investors, and other interested parties in their evaluation of the operating performance of companies in PFG’s industry.
4
Performance Food Group George Holm, President and CEO
5
Delivering Success
Our mission: to be a leader in the foodservice distribution industry by delivering world-class innovative products and value-added services that enable our customers’ success and support enduring supplier relationships
6
Who We Are
• Market leader with scale
• Differentiated strategy with customer-centric approach
• Unique performance brands private label business
• Growing specialty market offering
• National candy, snack and beverage distributor
• Disciplined and proven acquirer with ample opportunities
• Track record of strong and consistent financial performance
7
Broad Geographic Footprint
8
Headquarters Performance Foodservice 37 Customized 8 Vistar 28 Specialty 3 76
As of year-end Fiscal 2017
Solid Industry Fundamentals…
9
$555
$800
2010 2011 2012 2013 2014 2015 2016
Food Away From Home
Note: U.S. Department of Commerce for Food Away from Home; Technomic for U.S. Foodservice Market Size; excluding alcohol
$225 $228 $239
$247 $256
$268 $278
2010 2011 2012 2013 2014 2015 2016
U.S. Foodservice Market Size
$ Billions
$ Billions
CAGR 4%
CAGR 6%
…Combined with Market Share Gains…
10
160.8 167.1 171.3 175.8 185.8 193.0 199.0
67.2 71.9 75.7 80.2 82.2 85.0 90.0
2011 2012 2013 2014 2015 2016 2017
228.0 239.0 247.0
256.0 268.0
278.0 289.0
$ Billions CAGR 4%
Top 3: 29%
Others: 71%
31%
69%
Note: Technomic and company filings for Sysco, PFG, and US Foods. U.S. Sales only, where available; PFG estimates.
… And Unique Barriers to Entry
• Relationship-driven business
• Trucks have trailers with multi-temp coolers with large drop sizes
• Nationally branded, high-quality, specialized foodservice products
• SKUs are complex and have varying pack sizes
• Last mile logistics
11
We’ve Delivered Industry-Leading Case Growth…
12
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
2010 2011 2012 2013 2014 2015 2016 2017
CAGR 6%
Acquisitions Impact
…Strong Sales Growth
13
JUNEFY09
JUNEFY10
JUNEFY11
JUNEFY12
JUNEFY13
JUNEFY14
JUNEFY15
JUNEFY16
JUNEFY17
$16,105
We have delivered consistent sales growth over a long-term economic cycle
$ Millions Net Sales Growth $16,762 + 6.1%*
*Results shown on a comparable 13 or 52 week basis have been adjusted to remove dollar amounts equal to 1/14 of the fourth quarter results in fiscal 2016.
…And Solid EBITDA Growth
14
$193 $220
$241 $271 $286
$329 $367
$391
FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17
PFG Adjusted EBITDA(1)
(1) For reconciliation of non-GAAP to GAAP measures see the Appendix
$ Millions
CAGR 11%
Fragmented U.S. Foodservice Marketplace
15
2017 Market Size = ~ $289
Note: Technomic and company filings for Sysco, PFG, and US Foods. U.S. Sales only, where available; PFG estimates.
11-15,000+All Other
4-10Regional
Broadliners
Top 3 ~$90
~$29
~$170
$ Billions
Two-Year M&A Activity
16
Acquisition Annual Sales ($ Millions) Acquired Location
Bro
adlin
e Ellenbee Leggett $ 73 Q3 FY2017 Ohio
Presto Foods $ 140 Q4 FY2017 Ohio
Vist
ar
JSC Jenny Service Co. $ 40 Q1 FY2017 Nevada
$ 63 Q2 FY2017 Illinois
CCSI Candy $ 183 Q1 FY2018
California Florida
New Jersey North Carolina
Ohio Texas
Spec
ialty
Kinnealey Quality Meats $ 67 Q2 FY2017 Massachusetts
Larry Kline Wholesale Meats and Provisions $ 35 Q2 FY2017 Florida
Bar Harbor Seafood $ 89 Q3 FY2017 Florida
• Acquired eight companies in Broadline, Vistar, and Specialty
• Robust pipeline
• Searching for candidates that are complementary, white-space opportunities, cultural fits and are accretive to earnings
Performance Foodservice Dave Flitman, President and CEO
17
Segment Overview
18
• Channels served: − Focus on Independent Operations:
• Leading distributor in Pizza/Italian Segment • Family Dining • Bar and Grill • Fast Casual
− Local, Regional and Selected National Chains − Independent Healthcare − Hospitality
• Distribution Centers: 37 − Sell more than 125,000 food and food-related
products − Deliver to over 85,000 customer locations − Custom Cheese Processing Facility − 7 USDA Inspected Meat Cutting Facilities − Seafood Importing, Processing and Distribution
Facility − Comprehensive and growing portfolio of
Performance Brands
Segment Highlights
Footprint
Product Mix
National / Regional 56%
Independent 44%
Center of the Plate 45%
Dry 18% Frozen
13%
Disposables 8%
Beverage 5% Produce
4%
Other Dairy 4%
Refrigerated 2%
Chemicals 1%
Segment Overview
19
$6.7 $7.5
$8.1 $9.1
$9.6 $9.8
FY12 FY13 FY14 FY15 FY16 FY17
CAGR 8%
$178.2 $173.9 $207.5
$254.2
$307.0 $325.2
FY12 FY13 FY14 FY15 FY16 FY17
CAGR 13%
Net Sales EBITDA
• Customer-centric strategy • Laser focus on faster growing independent restaurants • Expanding portfolio of strategic Performance Brands • Evolving technology to enhance customer experience and salesforce effectiveness
Industry Leading Growth Driven By:
$ Billions $ Millions
Strategic Focus - Plan for Growth
20
Build a Company
Culture around the Customer
Experience
Put Safety First • Zero is the goal: personal and management accountability • Leverage enhanced DriveCam technology to combat fatigue
Drive Sales Growth • Invest in sales force (AM)
capacity • Enhance AM effectiveness
through Performance Academy • Sales enablement through device
agnostic order management • Provide customer insights and
data analytics through customer portal
Improve Gross Margins • Sell the most profitable customers and
products – Grow independent business 6% to 10% – Grow Performance brands 100 bps to 400 bps
faster than independent • Deliver MARKET WATCH
Improve Supply Chain Efficiency
• Implement standardized approach to re-routing
• Deliver productivity improvements
• Continue investment in facilities, fleet and drivers
Hit the Accelerators • Execute acquisition synergies • Continue to make accretive
acquisitions • Foster customer, employee and
supplier engagement • Train, develop, and acquire
talent
1
2
3 4
5
Improving Mix of Business
Independent Mix of Broadline Sales
38.1%
44.4%
FY12 FY17
39.1%
44.6%
FY12 FY17
Performance Brand Mix of Independent
Drive Profitability
630 bps 550 bps
• Seven consecutive years of 6% to 10% Independent case growth
• Mix shift of 630 bps in Independent mix of Broadline sales
• Brands consistently growing 100-400 bps faster than independent cases 21
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
Q1 FY16 Q2 FY16 Q3 FY16 Q4 FY16 Q1 FY17 Q2 FY17 Q3 FY17 Q4 FY17
PFG Sysco US Foods
Consistently Outperforms Competition
22
% PY
Note: YOY growth in Total Independent case volume (PFG and USF) and U.S. Broadline Local case growth (Sysco). All growth rates expressed on a 13-week to 13-week basis.
Total Independent Case Volume
Independent Case Growth Sources
To Reach Our Growth Goals
23
New
Lost
New Penetrated
Net New
Target
Mid-Teen Double-Digit Growth
Mid Single-Digit Growth
6% to 10% Growth
High Single-Digit Decline
• 1,700+ sales force
• Competitive environment and restaurant closings
• Strong loyalty and relationships
• 7 years of best-in-class* and consistent growth
*Among the three major distributors in the U.S.
EBITDA Margin Growth
2.32%
3.31%
2.0%
2.5%
3.0%
3.5%
FY13 FY17
24
99 bps +43%
Percent of Net Sales
Pillars of Customer-Centric Strategy
25
Through partnership and innovation, Performance Foodservice will enable the long-term success of our customers and ourselves
Lead in Innovative Products and Services
Commitment to Operational Excellence
Deliver Best Customer Experience
Within each pillar we will leverage relationships and technology to make business easy, smart, and profitable for our customers and our company
1 2 3
MAKE IT EASY
MAKE IT SMART
MAKE IT PROFITABLE
Customer Experience
26
Our technology pushes sales past consultative selling to INSIGHT SELLING
INSIGHT SELLING
• Predict and anticipate based on customer behavior • Same data set influences customers and informs sales • Sales empowered to leverage digital behavior as a selling tool • We enable our customers’ moves to digital; it’s there when they are ready
INSIGHT SELLING
COMPLEMENTARY ITEMS & MARKETING DIGITAL BEHAVIOR
CUSTOMIZES EXPERIENCE
ORDER ENTRY/ PRICE SHOP
Technology Enabled Customer Experience
27
Business Analytics
Industry & Market Trends
Menu Management
Automated Recalls
Rebates
Product & Nutritional Search
Food Cost Management
POS System
Market Watch
Insight & Impact
SPARK
Customer Portal/Single Sign On
Online and Mobile Ordering
Online Bill Pay
EDI Processing
Delivery Tracking
Proof of Delivery
Equipment & Supplies
Inventory Management
Alerts & Notifications
PILLAR 2
MAKE IT EASY
MAKE IT SMART
MAKE IT PROFITABLE
Digital business with us should be simple Technology Offerings:
Empower operators to make informed and timely business decisions Technology Offerings:
Value-added services that help operators manage their business Technology Offerings:
Leveraging Relationships and Technology to Enable Customer Success
• Provide a device agnostic “Digital First” suite of solutions for our customers that keeps them within our ecosystem
Our Digital Strategy
28
• “Digital First” is our development focus
• Our touchpoints are responsive with content designed to be consumed on any device
Responsive design
consumable on any device
Digital Content is Customer Specific
29
• No two customers are alike – leveraging content marketing via digital touchpoints
Websites Email Marketing Social & Blog
Always Responsive Design/Mobile Friendly Content Strategy Appeals to ALL Customers Insights Funneled to Sales
Digital Campaigns and Promotions
30
• Tools provided to our Area Managers coordinate and complement customer facing technology
• Reach target accounts with content specific promotions & campaigns
Digital Rebates and Coupon Redemption
31
• Track, present, and redeem manufacturer and exclusive brand product rebates through the customer landing page
Delivering Our Strategy Through Innovation
32
• Our customer-centric approach puts the customer at the center of all we do and develop • This evolutionary approach services our customers’ current needs while anticipating
future developments • Full portal launch expected by calendar year end 2017
Place an order Enhanced order management system
Pay for your order Billing, payment and payment wallet
Shop for E&S Equipment & supplies e-commerce site
Check your promotional status Loyalty campaigns and promotions
Plan and manage your menus and recipes Menu/recipe planning, analysis & management
Market and socialize your operation Social management and marketing support
Verify nutritional information Nutritional, allergen & all product attributes
Where’s My Truck Track your truck & delivery notifications
Technology Enables Sales Success
33
Prospects and CRM
• In use by area managers to find, create, track, and convert prospect activity through geo-location
Find qualified prospects & customers
Capture CRM information
Geo Location activated
e-Commerce Growth
34 Source: Estimated PFS e-commerce sales; fiscal years
30%
35%
40%
45%
50%
55%
0
20
40
60
80
100
120
140
160
180
200
2014 2015 2016 2017Total Weekly Sales Percentage of e-Commerce
Wee
kly
Sale
s %
of e-Com
merce
e-Commerce Sales by Year $ Millions
MARKET WATCH Independent Margin Initiative
35
My Alerts Weekly opportunity review
My Customers Prepare for a meeting
Before a customer visit
Prepare insights and identify growth opportunities
My Commission Monthly review of book
Daily/Weekly
Review commission performance, set targets and
adjust priorities
Daily/Weekly
Visualize, review and act on a set of targeted margin
opportunities
• Provides salesforce with critical insights and identifies margin opportunities in real time
• Includes customer segmentation analytics and peer comparisons
Strategic Initiative: Improving Engagement
36
Net Promoter, Net Promoter Score, and NPS are registered trademarks of Satmetrix NPS is based on PFS customer feedback Systems, Inc., Bain & Company, Inc., and Fred Reichheld.
Summary • Best-in-class* independent case growth driven by:
− Customer-centric strategy
− Laser focus on faster growing independent segment
− Expanding portfolio of strategic Performance Brands
− Evolving technology to enhance customer experience and salesforce effectiveness
• Customer feedback reinforces that we have a winning strategy
• Industry Leader in growing Pizza / Italian segment
• Robust pipeline of M&A opportunities
38 *Among the three major distributors in the U.S.
Performance Brands Fred Sanelli, SVP Marketing and Sales Development
39
40
Performance Brands
o Brand Development and What Makes Them Unique
o Why Brands?
o PerformanceFoodservice.com
o Brand Spotlight: Braveheart & Bacio
o Delivering Results
Branded Product Approach
41
PERFORMANCE EXCLUSIVE BRANDS ARE DEFINED AS:
Foodservice Products developed by a Foodservice Company - Specifically to meet and exceed the needs of Foodservice Operators.
PERFORMANCE Brand Manifesto 100+ years of product development
Quality tiers to meet and exceed the needs of all operators
Complete line of quality assured foodservice related products that provide value added solutions
Product portfolio developed specific to foodservice operation
Exclusively distributed by Performance Food Group and its companies
Committed to Innovation, Quality, Consistency and Versatility
We Live in the Brand…
42
Branded Product Approach
OPERATOR
COMPANY
AREA MANAGER
The PERFORMANCE “Triple Win”
1. Cost of Goods Advantage — Operator
2. Increased Gross Margin — Company
3. Increased Commission Earnings — Area Manager
Committed to Innovation, Quality, Consistency & Versatility
WHY BRANDED PRODUCTS?
43
Brand Development Umbrella Brands & Strategic Brands
PerformanceFoodservice.com
44
PerformanceFoodservice.com
45
ASK THE CHEF… o Recipe Center most visited o Increased Chef collaboration o Featuring our People, Products and Brands
PerformanceFoodservice.com
46
Branded Video & Training Center o Supplier Training Videos and Materials
47
Exclusive Brand Lineup Strategic Brands
BRAVEHEART BLACK ANGUS BEEF® Black Angus beef to satisfy operators’ needs with a serious commitment to quality, food safety (traceability) and state-of-the-art processing via our exclusive PathProven® program. Black Cattle raised in the Midwest and fed on local grains for superior flavor and tenderness.
ROMA The standard for pizza and Italian restaurant operators. Encompassing Old World excellence, Roma boasts a vast array of consistent, high-quality products that deliver authentic flavor – and meet or exceed demanding expectations.
BACIO Bacio is a uniquely crafted combination of mozzarella and a signature Kiss of Buffalo Milk™ for delicious authenticity and unparalleled performance. Bacio cheese is carefully crafted from premium ingredients for delicious taste, exceptional melt and reheat, superb stretch, and guaranteed quality.
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Braveheart Black Angus Beef
Braveheart Black Angus Beef® redefines premium beef, setting a higher bar for quality, taste, tenderness, consistency and ethical production processes. All done by controlling our supply chain.
WHY BRAVEHEART?
o Our cattle are born and raised in the upper Midwest of the U.S.
o 100% grass and grain fed on family farms – emphasizes humane practices and sustainability
o Processed in state-of-the-art facilities that focus on quality and consistency
o Incorporates the nation’s first-of-its-kind DNA-based traceability system and site audits. PathProven®
Braveheart Black Angus Beef What people are saying
TASTE
QUALITY
TRIM
CONSISTENCY Consistency, consistency, consistency–this is the MAIN reason I buy Braveheart. Day in and day out I know that the steak I had a month ago will taste the same as the steak I have today. I love the flavor, the taste and texture. Excellent
— Paul Simbliaris, Tuckaway Tavern, NH
It's a combination of things that make Braveheart the best meat I've seen and tasted in 76 years in the business. Braveheart has its own taste – nothing like it. It exceeds anything that's out there.
— Frank Murphy, Oakes Farms, FL
Best burger. Quality, taste, performance. It’s just a better product. It’s a cut above. You can’t “kill” a Braveheart burger. You overcook other meat, those meats turn to carbon–chewy, not good. The consistency of Braveheart and the flavor keeps me a customer and a fan.
— Bill Blocher, Red Brick Station, MD
Many branded beef programs talk the talk, but only Braveheart Beef can trace each and every steak to the animal it came from, ensuring premium quality, through our exclusive PathProven program.
— Dr. Brad Morgan, Senior Director of Protein 49
Braveheart Black Angus Beef In the News
Braveheart Black Angus Beef to Sponsor James Beard Foundation Awards Gala Reception For Second Year PERFORMANCE Foodservice and Braveheart® Black Angus Beef are taking center stage as an official sponsor of the 2016 James Beard Foundation Awards gala reception in Chicago. The event follows the ceremony for the prestigious restaurant industry awards, which recognize culinary excellence from across the United States.
Braveheart Black Angus Beef to be the featured beef at Preakness Stakes from May 16-19 at Pimlico Race Course in Baltimore Braveheart Black Angus Beef will be the featured beef at the Preakness Stakes from May 16-19, 2016, at Pimlico Race Course in Baltimore. Braveheart® Black Angus Beef, a premium Midwest-raised beef that is traceable back to its origins with DNA technology, Braveheart Black Angus Beef is the fastest-growing brand for Performance Food Group.
Performance Food Group First in U.S. to Use DNA-based Meat Traceability System for Hamburger Performance Food Group, one of the nation’s largest foodservice distributors, and Kansas-based IdentiGEN, a leader in meat traceability systems, have developed the first commercial solution to trace ground meat back to its origins using DNA technology. The collaboration marks the first time DNA TraceBack, previously used to trace cuts of meat, has been used to trace ground beef to its Black Angus origins.
DNA Technology on the Menu in 11,000 U.S. Restaurants Lawrence, Kan., May 26, 2011 -- 11,000 U.S. restaurants that serve Braveheart Black Angus Beef will be able to assure diners a guarantee of quality about their premium Angus beef through DNA TraceBack®, the nation’s first-of-its-kind assurance of quality and commitment. DNA technology is used to verify that the meat is sourced from black Angus cattle in the Midwest, ensuring premium quality for Performance Food Group customers.
50
Braveheart Annual Growth
51
FY12 FY13 FY14 FY15 FY16 FY17
CAGR 10% (LBS)
52
Bacio Premium Cheeses
Bacio is a uniquely crafted, all-natural combination of creamy mozzarella and a signature Kiss of Buffalo Milk™.
WHY BACIO?
o Premium Ingredients: Highest quality & all-natural ingredients like Grade A milk and buffalo milk.
o Delicious Taste: Authentically smooth and creamy with traditional dairy notes.
o Exceptional Melt: Consistent, velvety meltdown with no overbrowning or burning.
o Excellent Reheat: Comes back to life completely after reheat. Perfect for pizzerias serving slices.
o Superb Stretch: Distinctive stretch that remains impressive even as it cools.
o Robustness: Performs beautifully across a variety of oven applications.
o Guaranteed Quality: Unparalleled excellence, batch after batch.
53
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Bacio Premium Cheeses – Customer Touchpoints
MEMBERS-ONLY MARKETING SUPPORT Bacio isn’t just a premium cheese supplier, we’re also a partner to our pizzerias and do everything we can to help Gold Club succeed.
o Custom printing for menus o Location signage o Website creation o Loyalty programs o Promotional items and wearables
First Kiss Campaign Everyone remembers their first kiss. With a kiss of Buffalo Milk for an unforgettable pizza.
Bacio Annual Growth
FY12 FY13 FY14 FY15 FY16 FY17
CAGR 35% (LBS)
56
Delivering Results
Independent Mix of Broadline Sales
38.1%
44.4%
FY12 FY17
39.1%
44.6%
FY12 FY17
Performance Brand Mix of Independent
Drives Profitability
630 bps 550 bps
o Seven consecutive years of 6% to 10% Independent case growth
o Mix shift of 630 bps in Independent mix of Broadline sales
o Brands consistently growing 100-400 bps faster than independent cases 57
Summary
58
o Live in the Brand
− Committed to innovation, quality, consistency, and versatility
− Product portfolio developed specific to foodservice operation
− Quality tiers to meet and exceed the needs of all operators
− Reach our operators on a multitude of platforms
o Our efforts are resonating with our growing base of operators
− 2 billion+ product portfolio and growing
− Double-digit growth year over year
− Branded cases growing faster than overall cases
o Partner with the supply chain for increased quality, safety and exclusivity
Specialty Operations Jim Hope, EVP Operations
59
Specialty Overview
60
• Three stand-alone companies acquired in FY2017
‒ Bar Harbor Seafood
‒ Larry Kline Meats
‒ T.F. Kinnealey
• Eight existing Broadline OpCos with protein processing capabilities
‒ Seven USDA inspected meat cutting facilities
‒ One seafood importing and processing facility
• Key Strengths
‒ Unique and separate market identity as premium protein provider
‒ Dedicated specialists providing value-added and frequently customer-specific services
‒ Narrow and deep product assortment
Footprint
Strategic Rationale
• Enhanced sales growth
• Drive higher operating margins
• Responds to customer preferences
• Good cultural fit
61
Enhanced Sales Growth • Grow the acquired company’s direct sales
• Grow nearby PFG company’s sales within the specialty product category
• Grow through “cross selling” with our nearby Broadline company
62
Drive Operating Margins
63
0.67
0.79
0.93
0.97
0.98
1.00
1.18
1.20
1.22
1.27
1.41
Beverage
Fresh/Refr FD
Frozen
Produce
Grocery, Dry
All Categories
Dairy
Poultry
Disposables
Meats
Seafood
Indexed Gross Profit/Case by Category
FY2017
Source: PFS data
Responding to Our Customers
• Order Cut Offs are flexible and are open late into the evening
• Product is cut to each customer’s specific requirements
• Raw materials are bought in a more opportunistic manner to take advantage of favorable market availability and pricing
• Strict Order Cut Offs are established and enforced
• Customer chooses products from a consistent standard offering
• Product is typically bought in a more standard methodical way ensuring current market pricing and exceptional service levels
64
Specialty Companies operate differently than traditional Broadline distributors, in a way that delights their customers
Specialty Traditional Broadline
• White tablecloth customers prefer dedicated specialists • Willing to pay a premium
65
Creating Meaningful Synergies
Market Penetration
• Sell through adjacent PFS Broadline OpCos providing service with a “vested interest”
• Product line expansion for the Broadline OpCo • Outlet for by-products of processing that our Broadline
OpCos are unable to sell
Procurement Optimization
• Claim the profit we currently pay third-party specialty companies
• Aggregate volume to improve purchasing leverage • Access to PFG proprietary raw materials
Expense Leverage
• Reduce indirect spend by leveraging the purchasing scale of PFG
• Access to PFG management practices, processes and resources
66
Cultural Fit
• PFG employs a more autonomous management approach
• We encourage the owners to continue to lead the company
• We allow our Specialty companies to operate independently
67
PFG’s management philosophy is uniquely suited to fit Specialty Premium Processing companies and their customer intimate and product-centric approach
Current Company Profiles
68
Specialty Total
Location Brockton, MA Deerfield Beach, FL Orlando, FL
Primary Focus Custom cut meats Custom cut meats Live, fresh, and
frozen seafood
Processed, value-added
products
Total Square Footage Under Roof 99,120 22,200 60,726 182,046
Acquisition Date 10/14/16 10/21/16 01/27/17
*FY2017 Annualized Run Rate
Summary
• Specialty offers value-added services, strong case growth, and higher margins
• Driving sales and profitability
• Restaurants want specialized meats and seafood
• Cross-selling opportunities
• Synergies
• Cultural fit
69
PFG Customized Craig Hoskins, President and CEO
70
Overview Footprint
• 8 distribution centers
• More than 5,000 customer locations
• Specifically meets the special needs of family and casual dining chains across the United States
• Long-standing relationships with many iconic American restaurant concepts
• Excellent operations: − 99.7% + Fill Rate – Virtually No Subs
− Items and areas dedicated to concept inventory
− Efficient pick and high accuracy
− Leading edge technologies
• Perishable expertise: − Fresh Seafood, Shellfish and Produce
− Fresh Proteins
− Fluid Dairy and All Natural Ice Cream
Segment Highlights
71
72
Customized
$2.9 $3.2 $3.3
$3.8 $3.8 $3.8
FY12 FY13 FY14 FY15 FY16 FY17
CAGR 6%
$38.7 $37.3 $37.5 $36.5 $34.1
$25.3
FY12 FY13 FY14 FY15 FY16 FY17
CAGR (8%)
Net Sales EBITDA
• Continue to bring on the right customers with the right economics
• Expand targets to include the right fast casual chains
• Continually work to gain efficiencies through operational improvements
Growth Strategy
Red Lobster
Austell Closing
------
$ Billions $ Millions
Executive Overview and Strategy
73
Outstanding Customer
Experience
Productivity and
Associate Experience
Safety and Regulatory Compliance
Financial Management
2
4
1 3
1
4 2
3
• Right Customers with the Right Program
• Value Added Relationships • Service Offerings • Efficient structure and network
which adds to control and quality for emerging and large concepts
• Safety in the center • Resources and actions that build safety culture • Training and resources and actions
that drive compliance
• Capital light model with working capital initiatives which do not impact customer experience
• Match organization structure and size to business trends and strategy
• Improve gross margins
• Work to retain and gain productivity despite challenging environment − Transportation − Warehouse − Central Services
− Centralize where appropriate
− Leave remote when best for service
• Excellent associates • Improve retention
Casual Dining - Large Segment
$14,319
$42,300
Top 500:Family Style
Total Industry:Family Style
74
$ Millions
2016 Sales
Source: Technomic Inc., Top 500 Chain Restaurant Report * Nations Restaurant News July 2017
• Large segment with scale and efficiencies
‒ Represents $42.3 billion in consumer expenditures from tens of millions of customer visits
‒ Select concepts are growing and holding their own; other concepts are closing underperforming restaurants
• 31 of Top 100 chains are either family or casual dining restaurants*
• PFG serves 10 of the 31, including all or part of 4 of the top 10
• Unit economics can be attractive – drops tend to be among the largest and most efficient in foodservice
• Well-positioned distributor to serve this space
Strong, Long-Term Relationships
75
+25 Years +10 Years
Plus Newer Relationships
Technology
• Largely self Developed ERP
• 100% of orders placed on line
• Customized to meet the needs of chain restaurants
• Real time inventory views and customer reporting
• POD Scanners Deployed
• Rolling out ring scanners in warehouse to further improve service and reduce shrink
• Descartes Route Planning System
• DriveCam onboard cameras
• BellTower Product Recall System
76
Improving the Customer Portfolio
• PFG entered into an agreement to distribute to Red Lobster’s 670+ U.S. restaurants
• Winning Red Lobster as a customer solidified PFG Customized’s position as a premier distributor to chains with scale who require value added services
• Red Lobster’s network of U.S. restaurants has substantial overlap with PFG Customized’s existing business – adding business that strengthened the portfolio and increased efficiencies of the network
• Required rationalizing of customer base and exiting concepts with less strategic fit or scale
• Provides a model for future strengthening where network, profitability, needs and culture provide a similar fit
77
Austell Closure Update
• Closed Austell facility on June 30, 2017
− Historically unprofitable location
− Served only two customers – both quick serve restaurants
− Small cost savings due to lack of profitability and headcount reduction
− Rationalize portfolio and reviewing customer base
78
Summary
• Casual dining is a large industry with tens of millions of customers per year
• Customer base has scale and provides efficiencies
• Expanding mix into fast casual where economics, culture, and requirements fit our network
• Operators that execute well are growing; some operators are removing underperforming restaurants
• Capital light model and working capital initiatives underway
• Opportunity to improve margins through contractual arrangements, customer mix, and introduction of branded products
• Very well positioned in the industry due to outstanding platform and technology set that can meet the needs of customers
79
Vistar Patrick Hagerty, President and CEO
80
Segment Overview
81
Footprint • Leading distributor of candy, snacks, and
beverages and other single serve, impulse, immediate consumption items
• Channels served: − Vending Distributors − Office Coffee Service Distributors − Theaters, Stadium and Arenas − Retail Impulse − Hospitality − College Bookstores/C-Stores − Corrections
• Operating Companies: 28 • Core Competencies:
− National distribution network − Unparalleled inventory variety − Perishable distribution capability − Proven ability to leverage specialized inventory to
penetrate new customer channels − Flexible distribution capabilities: truckloads to pieces
Segment Highlights
Product Mix: FY2017
Snacks 18%
Candy 22%
Frozen 17%
Refrig 4%
Beverage 27%
Other 12%
82
Delivering Growth
$1.9 $2.1 $2.3
$2.4 $2.7
$3.0
FY12 FY13 FY14 FY15 FY16 FY17
CAGR 9%
$57.7
$81.4 $88.3
$105.5 $113.0
$120.8
FY12 FY13 FY14 FY15 FY16 FY17
CAGR 16%
Net Sales EBITDA
• Utilize strengths to grow both core and emerging channels
• Improve mix
• Improve cost structure through utilization of technology
• Enter new channels and develop new capabilities through acquisitions
Growth Strategy
$ Billions $ Millions
A History of Evolution • The type of products we sell defined us:
− Single Serve
− Impulse
− Immediate consumption
• What began as candy, chips, and soda evolved to protein bars, energy drinks and meal replacement options
• SKU growth continues to evolve as consumers continue to evolve
− Retro and bulk candy
− Good to Go
− Better for you products
− Meal replacement options
83
More Customers
More SKUs More Channels
A History of Channel Evolution: Vending
84
A History of Channel Evolution: Office Coffee
85
A History of Channel Evolution: Theater
86
A History of Evolution
87
FY2017 FY2008 FY 2002 $1.4B Net Sales $3.0B Net Sales $1.0B Net Sales
73%
15% 3%
1%
3% 5%
Vend/OCSTheater/ConcessionRetailHospitality/TravelCorrectionsAll Other
59%
17%
6%
6%
6% 2%
2% 2%
1% Vend/OCSTheater/ConcessionOther RetailCampusOffice SupplyHospitality/TravelValue StoreCorrectionsAll Other
96%
4%
Vend/OCSTheater
Customers • More than 20,000 SKUs carried to service a broad range of customers
• 45% growth in customer base since 2013
• As customers have evolved so have we by expanding services they want while continuing to evolve our customer base
88
0 10,000 20,000 30,000 40,000 50,000 60,000
2017
2016
2015
2014
2013
Number of Customers
Customers – Vending / OCS
89
Customers – Theater
90
Customers – Hospitality
91
Customers – Retail
92
Suppliers • An evolving supplier network to meet customer needs and expand SKU
offerings
• Vistar is the 3rd-largest distributor of MARS Chocolate in North America and the 3rd-largest distributor of Frito-Lay
− We are the 2nd-largest distributor of Mrs. Freshley’s snack division and the 3rd-largest Starbucks Coffee foodservice distributor
• Our size provides opportunities for our suppliers to expand their marketplace
91
Evolving to meet changing consumer behavior and needs
93
Nationwide Coverage
94
Wholesale candy, snack, and beverage specialists
Delivering solutions from one box to a truckload
Nationwide Coverage
95
Wholesale candy, snack, and beverage specialists
Retail solutions with nationwide coverage
Evolving Beyond a Distributor • Continue to build upon our core competencies in distribution centers and
logistics
• Ongoing evolution and expansion of product offerings in the impulse, single serve, immediate consumption category
• Invest in the continued growth of automated facilities and IT infrastructure to expand into overnight delivery
• Target direct to consumer and automated e-commerce fulfillment
96
Distributor Fulfillment Direct to consumer
Automated Technology • Vistar Retail Central – an automated
parcel distribution facility in Southaven, Mississippi
• Allows for significant enhancement to product availability and outbound order shipping capacity
• Software and conveyor technology provide significant enhancements to operational processes such as:
− Carton sizing
− Temperature protective packaging
− Order picking, packing, and shipping
• Driving future productivity and profitability, expanding new growth channels
98
Vistar has elevated its capability to respond to today’s diverse customer base while ensuring we are prepared for future growth by significantly enhancing our ability to satisfy key customer requirements for LTL-Warehouse Pallet Deliveries, E-Commerce, and Pick and Pack Parcel Distribution
The Future of Automated Facilities • Three current retail facilities with one automated site
• Two additional automated facilities on the West and East coasts planned for FY2018-FY2019
• 2020 vision of 6 total automated facilities
99
Retail: Traditional vs. e-Commerce
100
• Legacy retailers are restructuring their footprints with large retailers such as Aeropostale, JC Penney, Gap, Walmart, Macy’s shuttering stores in 2016
• Retail bankruptcies (or pending) including TSA, Gander Mountain, Sears (Vistar Retail Customers)
• Online sales growth dwarfs that of the retail industry
• e-Commerce sales are expected to increase annually by 17%, reaching $414 billion by 2018
3.2
1.0 1.4
7.4 6.1
10.1
2014 2015 2016
Sale
s G
row
th %
Total Retail Online
Note: 2016 accounts for results through August; online sales includes catalogs; all sales growth excludes annual CPI Source: U.S. Census Bureau, Bloomberg, Strategy & Analysis
2.3x Total Retail
6.1x Total Retail
7.4x Total Retail
Plans for Growth
101
MANUFACTURERS
VISTAR
Large Retailers Boutique Retailers
Other Smaller Distributors
Direct to E-Comm Consumers (Vistar E-Comm for business,
club sports programs, consumers etc.)
Production
Distribution Centers & Delivery Logistics
Brick & Mortar Retailers w/E-Comm Presence
“e-Commerce Distributor of Candy & Snacks”
E-Commerce Retailers
Summary • Leading distributor of candy, snacks, and beverages and other single
serve / impulse items
• Leverage a national footprint that allows new customers and segments
• Unparalleled inventory variety
• Tremendous e-Commerce growth opportunities
• M&A pipeline remains strong
102
Performance Food Group Tom Ondrof, EVP and CFO
103
Fiscal 2017 Financial Performance
104
FY2017 Growth vs. PY*
Cases 6.2%
Net Sales $16.8B 6.1%
Gross Profit $2.1B 7.9%
Operating Expense $1.9B 8.0%
Net Income $96.3MM 45.5%
Diluted EPS $0.93 38.8%
Adjusted EBITDA1 $390.7MM 9.0%
Adj. EBITDA1/Gross Profit 18.4% 20 bps
Adjusted Diluted EPS1 $1.24 27.8%
*Results shown on a comparable 13 or 52 week basis. (1) For reconciliation of non-GAAP to GAAP measures see the Appendix
Notes: Company filings. Definitions of Adj. EBITDA and items included as adjustments may differ between companies; All figures as reported.
Strong Track Record of Growth
90%100%110%120%130%140%150%160%170%
CY2010 CY2011 CY2012 CY2013 CY2014 CY2015 CY2016 1H CY2017
159%
137%
124%
90%100%110%120%130%140%150%160%170%180%190%
CY2010 CY2011 CY2012 CY2013 CY2014 CY2015 CY2016 1H CY2017
188%
136%
137%
Net Sales
Adjusted EBITDA
105
Looking Ahead: Our Focus
106
• Continued investment in growth
• Expanding operating margins
• Disciplined use of capital
Investment in Growth
1,400
1,700
FY12 FY13 FY14 FY15 FY16 FY17
107
PFS AM Sales Force
Notes: FY totals are rounded IFH Acquired May 2012; Fox River acquired December 2012
21% Growth
2.09%
2.33%
FY12 FY13 FY14 FY15 FY16 FY17
Expanding Margins
108
• Productivity − OpEx innovation − Pricing tool − Brand penetration
• Leverage − Supplier negotiations − New supplier billing process − Overhead control
• Mix − Mix shift to Independent − Specialty growth at higher
margin
Note; Adjusted EBITDA as a percentage of net sales
Disciplined Use of Capital
1. Investment in the business = facility expansions − 149,000 sq. ft. added in FY2016
− 426,000 sq. ft. added in FY2017
− 750,000 sq. ft. planned in FY2018
2. Strategic M&A − Specialty
− Broadline
− Vistar
3. Deleverage − Focused working capital management
− Under 3.0x without acquisitions
109
Net Debt and Leverage
$1,197
$1,469 $1,454 $1,413
$1,135 $1,289
2012 2013 2014 2015 2016 2017
$ Millions
4.4x
5.3x 5.1x
4.4x
3.1x 3.3x
FY2018 Outlook
110
PFGC provides fiscal 2018 Adjusted EBITDA1 growth versus PY:
8% to 11%
PFGC provides fiscal 2018 Adjusted Diluted EPS1 growth versus PY outlook:
13% to 18%
1 This presentation includes several metrics, including EBITDA, Adjusted EBITDA and Adjusted Diluted Earnings per Share that are not calculated in accordance with Generally Accepted Accounting Principles in the U.S. (“GAAP”). Please see Statement Regarding NonGAAP Financial Measures at the beginning of this presentation for the definitions of such nonGAAP financial measures and reconciliations of such nonGAAP financial measures to their respective most comparable financial measures calculated in accordance with GAAP
3-Year Financial Goals
111
5% TOTAL CASES
10% ADJ. EBITDA
15bps ADJ. EBITDA MARGIN
3-year financial goals are on an annual compounded basis
GROWTH GROWTH GROWTH
Summary • Industry-leading growth company
• Continue to focus and grow independent cases
• Profitably grow our share in a fragmented marketplace
• Performance Brands private label business is unique with higher margins
• Specialty has higher margin of cross-selling opportunities
• Rationalizing portfolio and customer base in Customized segment
• e-Commerce is a future growth platform
• M&A pipeline is robust
• Consistent track record of earnings growth
112
Questions
113
114
Appendix
EBITDA and Adjusted EBITDA Reconciliation
115
Non-GAAP Financial Measures Refer to Item 7. Management Discussion and Analysis of Financial Condition and Results of Operations included in the annual report on Form 10-K for the fiscal year ended July 1, 2017 for statements regarding our use of non-GAAP financial measures and the definitions of such non-GAAP financial measures. We believe that the most directly comparable GAAP measure to EBITDA and Adjusted EBITDA is net income. The following table reconciles EBITDA and Adjusted EBITDA to net income for the periods presented:
(i) Includes adjustments for non-cash charges arising from stock-based compensation, interest rate swap hedge ineffectiveness, and gain/loss on disposal of assets. Stock compensation cost was $17.3
million, $17.2 million, $1.2 million, $0.7 million, $1.1 million, $1.1 million, $1.1 million and $0.8 million for fiscal 2017, fiscal 2016, fiscal 2015, fiscal 2014, fiscal 2013, fiscal 2012, fiscal 2011 and fiscal 2010, respectively. In addition, this includes an increase (decrease) in the LIFO reserve of $2.6 million, $(1.5) million, $1.7 million, $3.0 million, and $0.8 million for fiscal 2017, fiscal 2016, fiscal 2015, fiscal 2014, and fiscal 2013, respectively. There was no LIFO reserve adjustment in fiscal 2012, fiscal 2011 and fiscal 2010.
(ii) Includes professional fees and other costs related to completed and abandoned acquisitions; in fiscal 2015 these fees are net of a $25.0 million termination fee related to the terminated agreement to acquire 11 US Foods facilities from Sysco and US Foods, costs of integrating certain of our facilities, facility closing costs, advisory fees paid to Blackstone and Wellspring, and offering fees. For fiscal 2013, this also includes $11.2 million for the impact of the initial fair value of inventory that was acquired as part of acquisitions.
(iii) Consists primarily of an expense related to our withdrawal from a purchasing cooperative of which we were a member, pre-acquisition worker’s compensation claims related to an insurance company that went into liquidation, a legal settlement expense, transition costs related to IT outsourcing, certain severance costs, and the impact of business interruption because of weather related or one-time events.
(iv) Consists primarily of professional fees and related expenses associated with productivity initiatives. (v) Includes amounts related to the withdrawal from the Central States Southeast and Southwest Areas Pension Fund. See Note 15 Commitments and Contingencies to the audited consolidated
financial statements included in Item 8. Financial Statements and Supplementary Data of the annual report on Form 10-K for the fiscal year ended July 1, 2017. (vi) Consists primarily of changes in fair value and costs related to settlements on our fuel collar derivatives, certain financing transactions, lease amendments, and franchise tax expense and other
adjustments permitted by our credit agreements.
Speaker Biographies George Holm – President and CEO, PFG Corporate George Holm became President and Chief Executive Officer of PFG when it was acquired by Vistar Corporation in May 2008. Prior to that, he served as President and Chief Executive Officer of Vistar, which he founded in 2002.
George grew Vistar, a multi-channel food, snack and beverage distributor, into a $3.5-billion company. Vistar was purchased by the Blackstone Group, a premier global investment and advisory firm, in 2007.
With 40 years of experience in the foodservice distribution industry, George has held various leadership positions with Alliant Foodservice, US Foods, and Sysco Corporation.
George received a bachelor’s degree in business administration from Grand Canyon University.
Dave Flitman – President and CEO, Performance Foodservice Dave Flitman joined PFG as Executive Vice President and President and Chief Executive Officer of Performance Foodservice, the company’s broadline business segment, in January 2015.
Prior to his current role, Dave most recently was Chief Operating Officer at Univar, a leading global distributor of industrial and specialty chemicals. He had previously served Univar as Executive Vice President, President of Univar USA, and Chief Supply Chain Officer. Before that, Dave was Executive Vice President and President of Water and Process Services at Ecolab after several years in executive leadership roles at Nalco. Earlier in his career, he was President of Allegheny Power following nearly 20 years at DuPont in operational, commercial and global business leadership positions.
Dave was appointed to the Board of Directors at Veritiv Corporation, a North American leader in business-to-business distribution solutions, in July 2017. He is a member of the board’s audit and finance committee.
Dave holds a bachelor’s degree in chemical engineering from Purdue University.
Patrick Hagerty – President and CEO, Vistar Pat Hagerty has served as Senior Vice President of PFG and President and Chief Executive Officer of Vistar since September 2008.
Prior to his current role, Pat was Vice President and Chief Operating Officer of Vistar. Before that he was Vistar’s Vice President of Merchandising after joining the company in 1994. Earlier in his career, Pat served as the Director of General Merchandise for CUB Foods, a division of Super Value.
Pat holds degrees from Colorado State University and the University of Southern California.
116
Speaker Biographies
117
Jim Hope – EVP Operations, PFG Corporate Jim Hope was named Executive Vice President of Operations for PFG in July 2014.
Prior to joining PFG, Jim spent 26 years in executive leadership roles at Sysco Corporation. Most recently he was Executive Vice President of Business Transformation after serving as Senior Vice President of Sales and Marketing. Before that Jim progressed through several financial and sales leadership positions prior to becoming President and CEO of Sysco’s Kansas City operating company.
Jim received a bachelor’s degree from the University of Texas.
Craig Hoskins – President and CEO, PFG Customized Distribution Craig Hoskins was named President and CEO of PFG Customized Distribution and a Senior Vice President of PFG in January 2012 after serving as President and COO of Customized Distribution. He previously was the Senior Vice President of Sales for PFG.
Craig joined PFG in 2008 following the acquisition of the company by Vistar Corporation where he progressed through successive roles of increasing responsibility in sales and marketing, merchandising/purchasing, and operations.
Prior to PFG/Vistar, Craig worked in the high tech electronics industry and in the LTL trucking industry.
He earned a bachelor’s degree in business administration from the University of Northern Colorado and a master’s degree in marketing from the University of Colorado in Denver, Colorado. Craig also sits on the board of directors for the International Foodservice Distributors Association (IFDA), sitting on its Executive Committee and serving as Audit Chairman.
Michael Neese – VP Investor Relations, PFG Corporate Michael serves as Vice President for Performance Food Group, where he oversees Investor Relations. Michael has extensive experience in developing strategies to communicate to Wall Street analysts with a background in all facets of investor relations, financial analysis and strategy/business development.
Before assuming his current role, Michael served as Vice President, Investor Relations with Avintiv, Inc., a Blackstone portfolio company. Prior to that role, Michael held various senior level roles in investor relations, communications and strategy and business development positions with Altria Group. Earlier in his career he worked for Nasdaq-American Stock Exchange and Thomson Investor Relations.
Michael earned a bachelor’s degree in finance from Virginia Tech and an MBA degree from the University of Richmond. Michael currently serves on the Board of the Visual Arts, Little Sisters of the Poor, and Maymont. He is also on the advisory council for the University of Richmond’s Business School and the Richmond Ballet.
Speaker Biographies
118
Tom Ondrof – EVP and CFO, PFG Corporate Tom Ondrof joined PFG as Executive Vice President and Chief Financial Officer in October 2016.
Prior to this current role, Tom had a 24-year career with Compass Group North America, a $14-billion global leader in contract foodservice. During his tenure he served as Director of Financial Planning (1991-1996), Corporate Controller (1996-1999) and Chief Financial Officer (1999-2010). He was named Chief Strategy Officer in 2010 before serving in his most recent position as Chief Development Officer.
Tom holds a bachelor’s degree in accounting from Wake Forest University and an MBA degree from the University of Georgia. He is a Certified Public Accountant, Certified Management Accountant and serves on the Board of Visitors for the Wake Forest University School of Business.
Fred Sanelli – SVP Marketing & Sales, Performance Foodservice Fred Sanelli was named Senior Vice President of Marketing and Sales Development for Performance Foodservice in January 2011. He previously was the Vice President of Sales, Marketing, and Product Development for PFG.
Fred joined PFG in 2008 following the acquisition of the company by Vistar Corporation where he progressed through successive roles of increasing responsibility in sales, marketing, training, and brand development.
Prior to PFG/Vistar, Fred worked for Kraft/Alliant Foodservice and North American Enterprises, Inc. Fred has an extensive background in international sales, marketing, and product development. Fred attended the University of Southern Indiana where he studied Marketing and Communications.
Foodservice Industry Customer Verticals
119
Independent
Regional / National Chains
Retail / Hospitality
Education
Healthcare
Other
Independent
Regional / National Chains
Retail / Hospitality
Education
Healthcare
Other
Note: Technomic and company filings for Sysco, PFG, and US Foods. U.S. Sales only, where available; PFG estimates.
• Continue to improve mix of independents customers
• Focus on growth of Performance Brands private label business
• Increase geographic scope and scale through acquisitions
PFG Total Industry Total
PFG Overview
120
• Third largest foodservice distributor in the U.S. and a leading distributor to a wide variety of channels
• Operates primarily in three segments: − Performance Foodservice
− Vistar
− PFG Customized
• Emerging PFG Specialty business
2017 Net Sales = $16.8B
2017 Adj. EBITDA(1) = $390.7MM
26%
69%
5%
Performance Foodservice
Vistar PFG Customized
Note: EBITDA percentages presented for segments exclude corporate overhead and other
(1)For reconciliation of non-GAAP to GAAP measures see the Appendix.
18%
26% 33%
23%
Performance Foodservice
Other Channels
Vistar PFG Customized
Performance Foodservice Independent
EBITDA Profit Margins
4.0%
3.3%
0.7%
Vistar
Performance Foodservice
PFG Customized
Others 69%
Sysco 16% US
Foods 9%
PFGC 6%
EBITDA by Segment
FY2017E contains eleven months of actual and one month of estimated performance; these results are preliminary and unaudited
PFG Overview
121
$241 $271 $286
$329 $367
$391
2012 2013 2014 2015 2016 2017
Adjusted EBITDA(1)
$ Millions, % of Gross Profit
17.2% 17.1% 16.8% 17.8%
18.2%
18.4%
$11,506 $12,827 $13,686
$15,270 $16,105 $16,762
2012 2013 2014 2015 2016 2017
Net Sales $ Millions
Independent Cases
FY11* FY12 FY13 FY14 FY15 FY16* FY17*
25%
0%
6%
Acquisitions Impact
*All numbers expressed on a 52-week to 52-week basis (1) For reconciliation of non-GAAP to GAAP measures see the Appendix