Q2 2024 Chefs' Warehouse Inc Earnings Call Transcript
Key Points
- The Chefs' Warehouse Inc (CHEF) reported a strong 7.2% organic growth in net sales for the second quarter of 2024.
- Specialty sales increased by 7.5% organically, driven by unique customer growth of approximately 8.2% and placement growth of 11.3%.
- Gross profit margins improved by approximately 35 basis points, with the specialty category seeing a 50 basis point increase.
- The company has made significant infrastructure investments, adding approximately 1 million square feet of distribution capacity since 2019.
- The Chefs' Warehouse Inc (CHEF) has increased its sales force by approximately 10% per year since 2021, with even higher growth in key markets like Florida and California.
- Selling, general, and administrative expenses rose by 8.8% due to higher depreciation, amortization, and costs associated with supporting sales growth.
- The company faces risks and uncertainties that could cause actual results to differ materially from expectations, as highlighted in their forward-looking statements.
- Net inflation was reported at 3.3% in the second quarter, with the center-of-the-plate category experiencing 4.3% inflation.
- The company is experiencing some moderation in demand or volume, particularly during the summer months.
- The Chefs' Warehouse Inc (CHEF) is still working towards achieving its year-end 2025 capital allocation goals, with a current net debt to adjusted EBITDA ratio of approximately 3.2 times.
Greetings, and welcome to the Chefs' Warehouse second quarter 2024 earnings conference Call. As a reminder, this conference is being recorded.
I would now like to turn the conference over to your host, Alex Aldous, General Counsel, Corporate Secretary and Chief Government Relations Officer. Please go ahead sir.
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Thank you, operator. Good morning, everyone. With me on today's call are Chris Pappas, Founder, Chairman and CEO and Jim Leddy, our CFO. By now, you should have access to our second quarter 2024 earnings press release. It can also be found at www.chefswarehouse.com under the Investor Relations section.
Throughout this conference call, we will be presenting non-GAAP financial measures, including, among others, historical and estimated EBITDA and adjusted EBITDA as well as both historical and estimated adjusted net
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