US Foods lifts Q1 2023 results on cost inflation, volume growth

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US Foods Holding Corp. lifted its Q1 2023 sales and earnings boosted by cost inflation and case volume growth, according to an earnings release, beating analyst expectations. Highlights include:

  • Net sales rose 9.5% from $7.8 billion in Q1 2022 to $8.5 billion for the quarter ending April 1, 2023, driven by case volume growth and food cost inflation of 3.7%.
  • Total case volume increased 5.7% from the prior year driven by an 8.1% increase in independent restaurant case volume, an 18.8% increase in hospitality volume and a 5.9% increase in healthcare volume, offset by a 1.1% decrease in chain volume.
  • Net income rose from a $7 million loss to $82 million in the comparative quarters.
  • Net income per share on a basic basis rose from a 7-cent loss to 33 cents and on a diluted basis from a 7-cent loss to 32 cents.
  • Adjusted diluted EPS rose 38.9% from 36 cents to 50 cents.

Shares traded today at $40.40 against a 52-week range of $25.49-$41.28.

The $8.54 billion in quarterly revenue beat analyst expectations by $50 million while the non-GAAP EPS of 50 cents beat expectations by 8 cents, according to Seeking Alpha.

“We’re very pleased with what we accomplished during the first quarter,” Dirk Locascio, executive vice president and CFO, said in the press release. “Net sales were $8.5 billion in the first quarter, an increase of 9.5% over the prior year driven by case volume growth and inflation. We also drove strong gross profit growth of 19% again in the first quarter, which was well above growth in operating expenses.”

The company reaffirmed its fiscal 2023 outlook of adjusted EPITDA of $1.45 billion to $1.51 billion and adjusted diluted EPS of $2.45 to $2.65.

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