Q3 2024 Chefs' Warehouse Inc Earnings Call Transcript
Key Points
- The Chefs' Warehouse Inc (CHEF) reported a 5.6% organic growth in net sales for the third quarter of 2024.
- Gross profit margins increased by approximately 58 basis points, with specialty and center-of-the-plate categories showing significant improvements.
- The company achieved a strong year-over-year growth in unique item placements, enhancing customer relevance.
- Digital platform investments have led to increased online order adoption, with 54% of customers ordering online in Q3 2024 compared to 48% in 2023.
- The company has engaged a global consulting firm to drive top-line and bottom-line improvements, targeting annual incremental margin gains.
- Softer demand in July, partly due to Hurricane Beryl, impacted third-quarter revenue growth by approximately 1%.
- Selling, general, and administrative expenses increased by 7.4% due to higher depreciation, amortization, and costs associated with compensation and facilities.
- The integration of acquisitions like Hardee's is diluting overall EBITDA margins by about 20 to 25 basis points.
- The company continues to shed non-core, lower-margin business, which may impact top-line growth.
- The industry faces challenges with traffic and demand, particularly in the restaurant sector, which could affect future growth.
Greetings, ladies and gentlemen and welcome to the Chefs' Warehouse third quarter 2024 earnings conference call. As a reminder, this conference is being recorded.
I'd 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 Christopher Pappas, Founder, Chairman and CEO; and James Leddy, our CFO. By now, you should have access to our third 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
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