Cover Page
Cover Page - shares | 9 Months Ended | |
Sep. 25, 2020 | Oct. 23, 2020 | |
Entity Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 25, 2020 | |
Document Transition Report | false | |
Entity File Number | 001-35249 | |
Entity Registrant Name | CHEFS’ WAREHOUSE, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 20-3031526 | |
Entity Address, Address Line One | 100 East Ridge Road | |
Entity Address, City or Town | Ridgefield | |
Entity Address, State or Province | CT | |
Entity Address, Postal Zip Code | 06877 | |
City Area Code | 203 | |
Local Phone Number | 894-1345 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 37,769,724 | |
Entity Central Index Key | 0001517175 | |
Current Fiscal Year End Date | --12-25 | |
Amendment Flag | false | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2020 | |
Common Stock, par value $0.01 | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | Common Stock, par value $0.01 | |
Trading Symbol | CHEF | |
Security Exchange Name | NASDAQ | |
Preferred Stock Purchase Rights | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | Preferred Stock Purchase Rights | |
Trading Symbol | CHEF | |
Security Exchange Name | NASDAQ |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 25, 2020 | Dec. 27, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 208,545 | $ 140,233 |
Accounts receivable, net of allowance of $24,091 in 2020 and $8,846 in 2019 | 100,576 | 175,044 |
Inventories, net | 98,185 | 124,056 |
Prepaid expenses and other current assets | 31,466 | 13,823 |
Total current assets | 438,772 | 453,156 |
Equipment, leasehold improvements and software, net | 116,964 | 92,846 |
Operating lease right-of-use assets | 118,677 | 127,649 |
Goodwill | 214,581 | 197,743 |
Intangible assets, net | 138,993 | 138,751 |
Other assets | 3,789 | 3,534 |
Total assets | 1,031,776 | 1,013,679 |
Current liabilities: | ||
Accounts payable | 73,969 | 94,097 |
Accrued liabilities | 26,891 | 29,847 |
Short-term operating lease liabilities | 17,472 | 17,453 |
Accrued compensation | 10,907 | 8,033 |
Current portion of long-term debt | 5,904 | 721 |
Total current liabilities | 135,143 | 150,151 |
Long-term debt, net of current portion | 396,636 | 386,106 |
Operating lease liabilities | 112,192 | 120,572 |
Deferred taxes, net | 4,357 | 10,883 |
Other liabilities and deferred credits | 5,440 | 10,034 |
Total liabilities | 653,768 | 677,746 |
Commitments and contingencies | ||
Stockholders’ equity: | ||
Preferred Stock - $0.01 par value, 5,000,000 shares authorized, no shares issued and outstanding at September 25, 2020 and December 27, 2019 | 0 | 0 |
Common Stock, - $0.01 par value, 100,000,000 shares authorized, 37,772,640 and 30,341,941 shares issued and outstanding at September 25, 2020 and December 27, 2019, respectively | 378 | 304 |
Additional paid in capital | 300,255 | 212,240 |
Accumulated other comprehensive loss | (2,216) | (2,048) |
Retained earnings | 79,591 | 125,437 |
Total stockholders’ equity | 378,008 | 335,933 |
Total liabilities and stockholders’ equity | $ 1,031,776 | $ 1,013,679 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Sep. 25, 2020 | Dec. 27, 2019 |
Current assets: | ||
Allowance for accounts receivable | $ 24,091 | $ 8,846 |
Stockholders’ equity: | ||
Preferred Stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred Stock, authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred Stock, issued (in shares) | 0 | 0 |
Preferred Stock, outstanding (in shares) | 0 | 0 |
Common Stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common Stock, authorized (in shares) | 100,000,000 | 100,000,000 |
Common Stock, issued (in shares) | 37,772,640 | 30,341,941 |
Common Stock, outstanding (in shares) | 37,772,640 | 30,341,941 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 25, 2020 | Sep. 27, 2019 | Sep. 25, 2020 | Sep. 27, 2019 | |
Income Statement [Abstract] | ||||
Net sales | $ 254,030 | $ 396,880 | $ 829,957 | $ 1,165,327 |
Cost of sales | 193,393 | 299,660 | 639,687 | 880,359 |
Gross profit | 60,637 | 97,220 | 190,270 | 284,968 |
Selling, general and administrative expenses | 76,708 | 83,960 | 254,474 | 247,017 |
Other operating (income) expenses | (4,146) | 2,636 | (9,812) | 5,681 |
Operating (loss) income | (11,925) | 10,624 | (54,392) | 32,270 |
Interest expense | 4,706 | 4,517 | 15,602 | 13,913 |
(Loss) income before income taxes | (16,631) | 6,107 | (69,994) | 18,357 |
Provision for income tax (benefit) expense | (5,204) | 1,682 | (24,148) | 5,052 |
Net (loss) income | (11,427) | 4,425 | (45,846) | 13,305 |
Other comprehensive (loss) income: | ||||
Foreign currency translation adjustments | 93 | (71) | (168) | 102 |
Comprehensive (loss) income | $ (11,334) | $ 4,354 | $ (46,014) | $ 13,407 |
Net (loss) income per share: | ||||
Basic (in dollars per share) | $ (0.31) | $ 0.15 | $ (1.39) | $ 0.45 |
Diluted (in dollars per share) | $ (0.31) | $ 0.15 | $ (1.39) | $ 0.45 |
Weighted average common shares outstanding: | ||||
Basic (in shares) | 36,283,883 | 29,549,308 | 32,868,162 | 29,511,143 |
Diluted (in shares) | 36,283,883 | 29,954,837 | 32,868,162 | 29,723,609 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Cumulative Effect, Period of Adoption, Adjustment | Common Stock | Additional Paid in Capital | Accumulated Other Comprehensive Loss | Retained Earnings | Retained EarningsCumulative Effect, Period of Adoption, Adjustment |
Balance (in shares) at Dec. 28, 2018 | 29,968,483 | ||||||
Balance at Dec. 28, 2018 | $ 308,676 | $ (2,027) | $ 300 | $ 207,326 | $ (2,221) | $ 103,271 | $ (2,027) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net (loss) income | 1,134 | 1,134 | |||||
Stock compensation (in shares) | (23,680) | ||||||
Stock compensation | 915 | 915 | |||||
Exercise of stock options (in shares) | 20,383 | ||||||
Exercise of stock options | 412 | 412 | |||||
Cumulative translation adjustment | 55 | 55 | |||||
Shares surrendered to pay withholding taxes (in shares) | (24,002) | ||||||
Shares surrendered to pay tax withholding | (742) | (742) | |||||
Balance (in shares) at Mar. 29, 2019 | 29,941,184 | ||||||
Balance at Mar. 29, 2019 | 308,423 | $ 300 | 207,911 | (2,166) | 102,378 | ||
Balance (in shares) at Dec. 28, 2018 | 29,968,483 | ||||||
Balance at Dec. 28, 2018 | 308,676 | $ (2,027) | $ 300 | 207,326 | (2,221) | 103,271 | $ (2,027) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net (loss) income | 13,305 | ||||||
Cumulative translation adjustment | 102 | ||||||
Balance (in shares) at Sep. 27, 2019 | 30,288,630 | ||||||
Balance at Sep. 27, 2019 | 322,601 | $ 303 | 209,868 | (2,119) | 114,549 | ||
Balance (in shares) at Mar. 29, 2019 | 29,941,184 | ||||||
Balance at Mar. 29, 2019 | 308,423 | $ 300 | 207,911 | (2,166) | 102,378 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net (loss) income | 7,746 | 7,746 | |||||
Stock compensation (in shares) | 346,915 | ||||||
Stock compensation | 1,088 | $ 3 | 1,085 | ||||
Exercise of stock options (in shares) | 7,193 | ||||||
Exercise of stock options | 146 | 146 | |||||
Cumulative translation adjustment | 118 | 118 | |||||
Shares surrendered to pay withholding taxes (in shares) | (3,928) | ||||||
Shares surrendered to pay tax withholding | (126) | (126) | |||||
Balance (in shares) at Jun. 28, 2019 | 30,291,364 | ||||||
Balance at Jun. 28, 2019 | 317,395 | $ 303 | 209,016 | (2,048) | 110,124 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net (loss) income | 4,425 | 4,425 | |||||
Stock compensation (in shares) | (3,045) | ||||||
Stock compensation | 908 | 908 | |||||
Exercise of stock options (in shares) | 3,836 | ||||||
Exercise of stock options | 77 | 77 | |||||
Cumulative translation adjustment | (71) | (71) | |||||
Shares surrendered to pay withholding taxes (in shares) | (3,525) | ||||||
Shares surrendered to pay tax withholding | (133) | (133) | |||||
Balance (in shares) at Sep. 27, 2019 | 30,288,630 | ||||||
Balance at Sep. 27, 2019 | $ 322,601 | $ 303 | 209,868 | (2,119) | 114,549 | ||
Balance (in shares) at Dec. 27, 2019 | 30,341,941 | 30,341,941 | |||||
Balance at Dec. 27, 2019 | $ 335,933 | $ 304 | 212,240 | (2,048) | 125,437 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net (loss) income | (14,085) | (14,085) | |||||
Stock compensation (in shares) | 807,433 | ||||||
Stock compensation | 851 | $ 8 | 843 | ||||
Cumulative translation adjustment | (378) | (378) | |||||
Shares surrendered to pay withholding taxes (in shares) | (159,632) | ||||||
Shares surrendered to pay tax withholding | (2,704) | $ (2) | (2,702) | ||||
Balance (in shares) at Mar. 27, 2020 | 30,989,742 | ||||||
Balance at Mar. 27, 2020 | $ 319,617 | $ 310 | 210,381 | (2,426) | 111,352 | ||
Balance (in shares) at Dec. 27, 2019 | 30,341,941 | 30,341,941 | |||||
Balance at Dec. 27, 2019 | $ 335,933 | $ 304 | 212,240 | (2,048) | 125,437 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net (loss) income | (45,846) | ||||||
Cumulative translation adjustment | $ (168) | ||||||
Balance (in shares) at Sep. 25, 2020 | 37,772,640 | 37,772,640 | |||||
Balance at Sep. 25, 2020 | $ 378,008 | $ 378 | 300,255 | (2,216) | 79,591 | ||
Balance (in shares) at Mar. 27, 2020 | 30,989,742 | ||||||
Balance at Mar. 27, 2020 | 319,617 | $ 310 | 210,381 | (2,426) | 111,352 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net (loss) income | (20,334) | (20,334) | |||||
Stock compensation (in shares) | 176,037 | ||||||
Stock compensation | 1,999 | $ 2 | 1,997 | ||||
Public offering of common stock (in shares) | 6,634,615 | ||||||
Public offering of common stock | 85,941 | $ 66 | 85,875 | ||||
Cumulative translation adjustment | 117 | 117 | |||||
Shares surrendered to pay withholding taxes (in shares) | (1,846) | ||||||
Shares surrendered to pay tax withholding | (23) | (23) | |||||
Balance (in shares) at Jun. 26, 2020 | 37,798,548 | ||||||
Balance at Jun. 26, 2020 | 387,317 | $ 378 | 298,230 | (2,309) | 91,018 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net (loss) income | (11,427) | (11,427) | |||||
Stock compensation (in shares) | (22,477) | ||||||
Stock compensation | 2,075 | 2,075 | |||||
Cumulative translation adjustment | 93 | 93 | |||||
Shares surrendered to pay withholding taxes (in shares) | (3,431) | ||||||
Shares surrendered to pay tax withholding | $ (50) | (50) | |||||
Balance (in shares) at Sep. 25, 2020 | 37,772,640 | 37,772,640 | |||||
Balance at Sep. 25, 2020 | $ 378,008 | $ 378 | $ 300,255 | $ (2,216) | $ 79,591 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 25, 2020 | Sep. 27, 2019 | |
Cash flows from operating activities: | ||
Net (loss) income | $ (45,846) | $ 13,305 |
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | ||
Depreciation and amortization | 14,714 | 9,539 |
Amortization of intangible assets | 10,111 | 9,485 |
Provision for allowance for doubtful accounts | 20,447 | 3,277 |
Non-cash operating lease expense | 604 | 1,790 |
(Benefit) provision for deferred income taxes | (6,527) | 2,003 |
Amortization of deferred financing fees | 2,152 | 1,566 |
Stock compensation | 4,925 | 2,911 |
Change in fair value of contingent earn-out liabilities | (11,219) | 5,331 |
Loss on asset disposal | 52 | 64 |
Changes in assets and liabilities, net of acquisitions: | ||
Accounts receivable | 74,236 | (1,069) |
Inventories | 33,285 | (7,588) |
Prepaid expenses and other current assets | (16,227) | (5,163) |
Accounts payable, accrued liabilities and accrued compensation | (29,455) | (9,185) |
Other assets and liabilities | 2,617 | (2,721) |
Net cash provided by operating activities | 53,869 | 23,545 |
Cash flows from investing activities: | ||
Capital expenditures | (5,409) | (12,302) |
Cash paid for acquisitions, net of cash received | (60,437) | (28,077) |
Net cash used in investing activities | (65,846) | (40,379) |
Cash flows from financing activities: | ||
Payment of debt, finance lease and other financing obligations | (38,924) | (1,793) |
Proceeds from the issuance of common stock, net of issuance costs | 85,941 | 0 |
Payment of deferred financing fees | (856) | 0 |
Proceeds from exercise of stock options | 0 | 635 |
Surrender of shares to pay withholding taxes | (2,777) | (1,001) |
Cash paid for contingent earn-out liability | (2,927) | (967) |
Borrowings under asset-based loan facility | 100,000 | 0 |
Payments under asset based loan facility | (60,000) | (960) |
Net cash provided by (used in) financing activities | 80,457 | (4,086) |
Effect of foreign currency on cash and cash equivalents | (168) | (11) |
Net change in cash and cash equivalents | 68,312 | (20,931) |
Cash and cash equivalents-beginning of period | 140,233 | 42,410 |
Cash and cash equivalents-end of period | $ 208,545 | $ 21,479 |
Operations and Basis of Present
Operations and Basis of Presentation | 9 Months Ended |
Sep. 25, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Operations and Basis of Presentation | Operations and Basis of Presentation Description of Business and Basis of Presentation The financial statements include the consolidated accounts of The Chefs’ Warehouse, Inc. (the “Company”), and its wholly-owned subsidiaries. The Company’s quarterly periods end on the thirteenth Friday of each quarter. Every six to seven years, the Company will add a fourteenth week to its fourth quarter to more closely align its year-end to the calendar year. The Company’s business consists of three operating segments: East Coast, Midwest and West Coast that aggregate into one reportable segment, foodservice distribution, which is concentrated primarily in the United States. The Company’s customer base consists primarily of menu-driven independent restaurants, fine dining establishments, country clubs, hotels, caterers, culinary schools, bakeries, patisseries, chocolateries, cruise lines, casinos, specialty food stores, grocers and warehouse clubs. The COVID-19 Pandemic The COVID-19 pandemic (“COVID-19”) has had a material impact on the Company’s business and operations and those of its customers. In an effort to limit the spread of the virus, federal, state and local governments have implemented measures that have resulted in the closure of non-essential businesses in many of the markets the Company serves, which has forced its customers in those markets to either transition their establishments to take-out service, delivery service or temporarily cease operations. State and local governments began to ease these restrictions in mid-May, however, restrictions in certain key markets were not eased until early June. As of September 25, 2020, the majority of state and local governments with jurisdiction over markets in which the Company operates allow the Company’s customers to operate outdoor and indoor dining service while adhering to specified social distancing and capacity restrictions. The duration and extent of restrictions imposed on the Company’s customers by federal, state and local governments is dependent on future developments regarding the pandemic including new information about the severity of the disease, trends in infection rates, and development of effective medical treatments for the disease, among others. Due to COVID-19, the Company incurred estimated non-cash charges of approximately $15,800 related to incremental bad debt expense and approximately $9,800 related to incremental inventory obsolescence during the thirty-nine weeks ended September 25, 2020. The adverse impact to the Company’s customer base and market capitalization at the onset of COVID-19 were considered triggering events and, accordingly, the Company performed interim goodwill and long-lived asset quantitative impairment tests during the first quarter of 2020 as described in Note 8 to these financial statements. Consolidation The consolidated financial statements include all the accounts of the Company and its direct and indirect wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated. Unaudited Interim Financial Statements The accompanying unaudited consolidated financial statements and the related interim information contained within the notes to such unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and the applicable rules of the Securities and Exchange Commission (“SEC”) for interim information and quarterly reports on Form 10-Q. Accordingly, they do not include all the information and disclosures required by GAAP for complete financial statements. These unaudited consolidated financial statements and related notes should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto for the fiscal year ended December 27, 2019 filed as part of the Company’s Annual Report on Form 10-K, as filed with the SEC on February 24, 2020. The unaudited consolidated financial statements appearing in this Form 10-Q have been prepared on the same basis as the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K, as filed with the SEC on February 24, 2020, and in the opinion of management, include all normal recurring adjustments that are necessary for the fair statement of the Company’s interim period results. The year-end consolidated balance sheet data was derived from the audited financial statements but does not include all disclosures required by GAAP. Due to seasonal fluctuations, COVID-19 and other factors, the results of operations for the thirteen and thirty-nine weeks ended September 25, 2020 are not necessarily indicative of the results to be expected for the full year. The preparation of financial statements in conformity with GAAP requires management to make significant estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from management’s estimates. Guidance Adopted in Fiscal 2020 Measurement of Credit Losses on Financial Instruments: In June 2016 and as further amended in November 2018, the Financial Accounting Standards Board (the “FASB”) issued guidance which requires entities to use a forward-looking expected loss model to estimate credit losses. It also requires additional disclosure related to credit quality of trade and other receivables, including information related to management’s estimate of credit allowances. The Company adopted this guidance on December 28, 2019. The Company analyzes customer creditworthiness, accounts receivable balances, payment history, payment terms and historical bad debt levels when evaluating the adequacy of its allowance for doubtful accounts. In instances where a reserve has been recorded for a particular customer, future sales to the customer are either conducted using cash-on-delivery terms or the account is closely monitored so that agreed-upon payments are received prior to orders being released. A failure to pay results in held or cancelled orders. The Company also estimates receivables that will ultimately be uncollectible based upon historical write-off experience. Management incorporates current macro-economic factors in existence as of the balance sheet date that may impact the food-away-from-home industry and/or its customers, and specifically, beginning in the first quarter of fiscal 2020, the impact of COVID-19. Adoption of this guidance did not have a material effect on the Company’s consolidated financial statements. Leases: In April 2020, the FASB issued guidance describing approaches entities should follow when accounting for lease concessions negotiated due to the effects of COVID-19. The Company has negotiated rent deferrals with certain lessors that do not materially modify the amount of consideration due under the original contract terms. Consistent with the guidance, the Company elected to recognize such rent deferrals as accrued expenses. The Company continues to recognize expense during the deferral period. Guidance Not Yet Adopted Simplifying the Accounting for Income Taxes: In December 2019, the FASB issued guidance that eliminates certain exceptions related to the approach for intraperiod tax allocations, the methodology for calculating income taxes in an interim period and other simplifications and clarifications. The guidance will be effective for fiscal years beginning after December 15, 2020. Early adoption is permitted. The Company expects to adopt this guidance when effective and adoption will have an immaterial impact on its consolidated financial statements. Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity: In August 2020, the FASB issued guidance that simplifies the accounting models for financial instruments with characteristics of debt and equity. The amendments in the guidance result in fewer instances in which an embedded conversion feature must be accounted for separately from its host contract. This guidance will be effective for fiscal years beginning after December 15, 2021. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020. The Company expects to adopt this guidance on December 26, 2020 and adoption is not expected to have a material impact on its consolidated financial statements. |
Reclassifications
Reclassifications | 9 Months Ended |
Sep. 25, 2020 | |
Accounting Changes and Error Corrections [Abstract] | |
Reclassifications | Reclassifications On September 1, 2020, the Company received a comment letter from the staff of the SEC’s Division of Corporation Finance (“SEC”) with respect to the Company’s annual report on Form 10-K for the year ended December 27, 2019, requesting information regarding the Company’s presentation of food processing costs and separate presentation of selling, general and administrative expenses from other operating expenses. Food Processing Costs The Company’s food processing costs represent the costs to cut and package produce and protein products, primarily beef products, for sale to the Company’s customer base. The costs associated with food processing are normally incurred immediately prior to shipment and thus, historically, the Company treated these costs as handling expenses and presented them within operating expenses on its consolidated statements of operations. The Company has also separately disclosed its food processing costs, excluding depreciation expense, in the notes to its annual consolidated financial statements. Upon further consideration and discussions with the SEC, the Company concluded that food processing costs are more fairly presented as cost of sales and such costs should include depreciation expense associated with equipment and facilities used in food processing activities. Accordingly, the Company has reclassified its food processing costs from operating expenses to cost of sales. In accordance with Staff Accounting Bulletin (“SAB”) No. 99 “Materiality,” and SAB No. 108, “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements”, the Company evaluated the impact of the reclassification and determined that the impact was not material to its consolidated financial statements for any prior annual or interim period. See Note 3 “Summary of Significant Accounting Policies” for a full description of the components of costs of sales and food processing costs. Selling, General and Administrative Expenses In response to the SEC’s comment, the Company revised its presentation of total operating expenses such that selling, general and administrative expenses are presented separately from other operating expenses. Furthermore, management has reclassified gain/loss from asset disposal, which was previously presented as a non-operating expense, to other operating expenses. See Note 3 “Summary of Significant Accounting Policies” for a full description of the components of selling, general and administrative expenses and other expenses. The aggregate impact of the above reclassifications on prior periods are as follows: Thirteen Weeks Ended Thirty-Nine Weeks Ended September 27, 2019 September 27, 2019 As Reported Reclass As Restated As Reported Reclass As Restated Net sales $ 396,880 $ — $ 396,880 $ 1,165,327 $ — $ 1,165,327 Cost of sales 294,887 4,773 299,660 866,670 13,689 880,359 Gross profit 101,993 (4,773) 97,220 298,657 (13,689) 284,968 Selling, general and administrative expenses 91,345 (7,385) 83,960 266,323 (19,306) 247,017 Other operating expenses — 2,636 2,636 — 5,681 5,681 Total operating expenses 91,345 (4,749) 86,596 266,323 (13,625) 252,698 Operating income 10,648 (24) 10,624 32,334 (64) 32,270 Interest expense 4,517 — 4,517 13,913 — 13,913 Loss on asset disposal 24 (24) — 64 (64) — Income before income taxes 6,107 — 6,107 18,357 — 18,357 Provision for income tax expense 1,682 — 1,682 5,052 — 5,052 Net income $ 4,425 $ — $ 4,425 $ 13,305 $ — $ 13,305 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 25, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Revenue Recognition Revenues from product sales are recognized at the point at which control of each product is transferred to the customer. The Company’s contracts contain performance obligations which are satisfied when customers have physical possession of each product. The majority of customer orders are fulfilled within a day and customer payment terms are typically 20 to 60 days from delivery. Shipping and handling activities are costs to fulfill the Company’s performance obligations. These costs are expensed as incurred and presented within selling, general and administrative expenses on the consolidated statements of operations. The Company offers certain sales incentives to customers in the form of rebates or discounts. These sales incentives are accounted as variable consideration. The Company estimates these amounts based on the expected amount to be provided to customers and records a corresponding reduction in revenue. The Company does not expect a significant reversal in the amount of cumulative revenue recognized. Sales tax billed to customers is not included in revenue but rather recorded as a liability owed to the respective taxing authorities at the time the sale is recognized. The following table presents the Company’s net sales disaggregated by principal product category: Thirteen Weeks Ended Thirty-Nine Weeks Ended September 25, 2020 September 27, 2019 September 25, 2020 September 27, 2019 Center-of-the-Plate $ 115,570 45.5 % $ 176,778 44.5 % $ 395,224 47.6 % $ 516,907 44.4 % Dry Goods 31,495 12.4 % 65,379 16.5 % 113,480 13.7 % 193,518 16.6 % Pastry 27,618 10.9 % 53,579 13.5 % 92,427 11.1 % 160,316 13.8 % Cheese and Charcuterie 33,329 13.1 % 40,500 10.2 % 83,996 10.1 % 117,073 10.0 % Produce 24,172 9.5 % 4,875 1.2 % 60,240 7.3 % 13,255 1.1 % Dairy and Eggs 6,301 2.5 % 27,480 6.9 % 35,942 4.3 % 81,765 7.0 % Oils and Vinegars 9,487 3.7 % 20,487 5.2 % 31,082 3.7 % 60,117 5.2 % Kitchen Supplies 6,058 2.4 % 7,802 2.0 % 17,566 2.2 % 22,376 1.9 % Total $ 254,030 100 % $ 396,880 100 % $ 829,957 100 % $ 1,165,327 100 % The Company determines its product category classification based on how the Company currently markets its products to its customers. The Company’s definition of its principal product categories may differ from the way in which other companies present similar information. Deferred Revenue Certain customer arrangements in the Company’s direct-to-consumer business, prepaid gift plans and gift card purchases, result in deferred revenues when cash payments are received in advance of performance. The Company recognizes revenue on its prepaid gift plans when control of each product is transferred to the customer. Performance obligations under the Company’s prepaid gift plans are satisfied within a period of twelve months or less. Gift cards issued by the Company do not have expiration dates. The Company records a liability for unredeemed gift cards at the time gift cards are sold and the liability is relieved when the card is redeemed, the value of the card is escheated to the appropriate government agency, or through breakage. Gift card breakage is estimated based on the Company’s historical redemption experience and expected trends in redemption patterns. Amounts recognized through breakage represent the portion of the gift card liability that is not subject to unclaimed property laws and for which the likelihood of redemption is remote. The Company recorded deferred revenues, reflected as accrued liabilities on the Company’s consolidated balance sheets, of $993 and $1,345 as of September 25, 2020 and December 27, 2019, respectively. Right of Return The Company’s standard terms and conditions provide customers with a right of return if the goods received are not merchantable. Customers are either issued a replacement order at no cost, or are issued a credit for the returned goods. The Company recorded a refund liability of $208 and $314 as of September 25, 2020 and December 27, 2019, respectively. Refund liabilities are reflected as accrued liabilities on the consolidated balance sheets. The Company recognized a corresponding asset of $128 and $194 as of September 25, 2020 and December 27, 2019, respectively, for its right to recover products from customers on settling its refund liabilities. This asset is reflected as inventories, net on the consolidated balance sheets. Contract Costs Sales commissions are expensed when incurred because the amortization period is one year or less. These costs are presented within selling, general and administrative expenses on the Company’s consolidated statements of operations. Cost of Sales The Company records cost of sales based upon the net purchase price paid for a product, including applicable freight charges incurred to deliver the product to the Company’s warehouse, and food processing costs. Food processing costs include but are not limited to direct labor and benefits, applicable overhead and depreciation of equipment and facilities used in food processing activities. Food processing costs included in cost of sales were $4,001 and $4,773 for the thirteen weeks ended September 25, 2020 and September 27, 2019, respectively, and $12,708 and $13,689 for the thirty-nine weeks ended September 25, 2020 and September 27, 2019, respectively. Selling, General and Administrative Expenses Selling, general and administrative expenses include facilities costs, product shipping and handling costs, warehouse costs, and other selling, general and administrative costs. Other Operating Expenses Other operating expenses includes expenses primarily related to changes in the fair value of the Company’s earn-out liabilities, gains and losses on asset disposals, asset impairments and certain third-party deal costs incurred in connection with business acquisitions or financing arrangements. |
Net (Loss) Income per Share
Net (Loss) Income per Share | 9 Months Ended |
Sep. 25, 2020 | |
Earnings Per Share [Abstract] | |
Net (Loss) Income per Share | Net (Loss) Income per Share The following table sets forth the computation of basic and diluted net (loss) income per common share: Thirteen Weeks Ended Thirty-Nine Weeks Ended September 25, 2020 September 27, 2019 September 25, 2020 September 27, 2019 Net (loss) income per share: Basic $ (0.31) $ 0.15 $ (1.39) $ 0.45 Diluted $ (0.31) $ 0.15 $ (1.39) $ 0.45 Weighted average common shares: Basic 36,283,883 29,549,308 32,868,162 29,511,143 Diluted 36,283,883 29,954,837 32,868,162 29,723,609 Reconciliation of net (loss) income per common share: Thirteen Weeks Ended Thirty-Nine Weeks Ended September 25, 2020 September 27, 2019 September 25, 2020 September 27, 2019 Numerator: Net (loss) income $ (11,427) $ 4,425 $ (45,846) $ 13,305 Denominator: Weighted average basic common shares outstanding 36,283,883 29,549,308 32,868,162 29,511,143 Dilutive effect of stock options and unvested common shares — 405,529 — 212,466 Weighted average diluted common shares outstanding 36,283,883 29,954,837 32,868,162 29,723,609 Potentially dilutive securities that have been excluded from the calculation of diluted net (loss) income per common share because the effect is anti-dilutive are as follows: Thirteen Weeks Ended Thirty-Nine Weeks Ended September 25, 2020 September 27, 2019 September 25, 2020 September 27, 2019 Restricted share awards (“RSAs”) 389,163 330,696 393,905 122,876 Stock options 115,639 — 115,639 — Convertible notes 3,484,788 91,053 3,484,788 91,053 During August 2020, management identified an unintentional error in the calculation of the Company’s basic and diluted weighted average common shares outstanding for the thirteen and twenty-six weeks ended June 26, 2020. The error stemmed from the improper weighting of the 6,634,615 common shares issued during the quarter ended June 26, 2020. As a result, basic and diluted net loss per common share as previously reported for the thirteen and twenty-six weeks ended June 26, 2020 were understated. In accordance with SAB No. 99 “Materiality,” and SAB No. 108, “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements”, the Company evaluated the error and determined that the impact was not material to its consolidated financial statements for any prior annual or interim period. The changes to basic and diluted weighted average common shares outstanding and corresponding impacts to basic and diluted net loss per common share for the thirteen and twenty-six weeks ended June 26, 2020 were follows: Thirteen Weeks Ended Twenty-Six Weeks Ended June 26, 2020 June 26, 2020 As Reported As Restated As Reported As Restated Net loss per share: Basic $ (0.57) $ (0.62) $ (1.05) $ (1.10) Diluted $ (0.57) $ (0.62) $ (1.05) $ (1.10) Weighted average common shares: Basic 35,759,193 32,698,295 32,672,876 31,150,883 Diluted 35,759,193 32,698,295 32,672,876 31,150,883 |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 25, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Assets and Liabilities Measured at Fair Value The Company’s contingent earn-out liabilities are measured at fair value. These liabilities were estimated using Level 3 inputs. Long-term earn-out liabilities were $2,815 and $7,957 as of September 25, 2020 and December 27, 2019, respectively, and are reflected as other liabilities and deferred credits on the consolidated balance sheets. The remaining short-term earn-out liabilities are reflected as accrued liabilities on the consolidated balance sheets. The fair value of contingent consideration was determined based on a probability-based approach which includes projected results, percentage probability of occurrence and the application of a discount rate to present value the payments. A significant change in projected results, discount rate, or probabilities of occurrence could result in a significantly higher or lower fair value measurement. Changes in the fair value of contingent earn-out liabilities are reflected in other operating expenses on the consolidated statements of operations. The following table presents the changes in Level 3 contingent earn-out liabilities: Fells Point Bassian Sid Wainer Other Acquisitions Total Balance December 27, 2019 $ 4,544 $ 7,957 $ — $ 2,197 $ 14,698 Acquisition value — — 2,081 1,383 3,464 Cash payments — (2,250) — (1,677) (3,927) Changes in fair value (4,544) (4,337) (1,581) (757) (11,219) Balance September 25, 2020 $ — $ 1,370 $ 500 $ 1,146 $ 3,016 Fair Value of Financial Instruments The following table presents the carrying value and fair value of the Company’s convertible notes. In estimating the fair value of the convertible notes, the Company utilized Level 3 inputs including prevailing market interest rates to estimate the debt portion of the instrument and a Black Scholes valuation model to estimate the fair value of the conversion option. The Black Scholes model utilizes the market price of the Company’s common stock, estimates of the stock’s volatility and the prevailing risk-free interest rate in calculating the fair value estimate. September 25, 2020 December 27, 2019 Carrying Value Fair Value Carrying Value Fair Value Convertible Senior Notes $ 150,000 $ 141,048 $ 150,000 $ 165,000 Convertible Unsecured Note $ 4,000 $ 3,711 $ 4,000 $ 4,282 |
Acquisitions
Acquisitions | 9 Months Ended |
Sep. 25, 2020 | |
Business Combinations [Abstract] | |
Acquisitions | Acquisitions Sid Wainer On January 27, 2020, pursuant to an asset purchase agreement, the Company acquired substantially all of the assets, including certain real-estate assets, of Sid Wainer & Son (“Sid Wainer”), a specialty food and produce distributor in New England. The final purchase price was approximately $44,081, consisting of $46,450 paid in cash at closing, partially offset by a $2,369 net working capital true-up. The Company will also pay additional contingent consideration, if earned, in the form of an earn-out amount which could total $4,000 over a two-year period. The payment of the earn-out liability is subject to the successful achievement of certain gross profit targets. The Company estimated the fair value of this contingent earn-out liability to be $2,081 and $500 as of January 27, 2020 and September 25, 2020, respectively. Trademarks were valued at fair value using Level 3 inputs and are being amortized over 15 years. Goodwill for the Sid Wainer acquisition will be amortized over 15 years for tax purposes. The goodwill recorded primarily reflects the value of acquiring an established specialty food and produce distributor to leverage the Company’s existing products in the markets served by Sid Wainer, to supply Sid Wainer’s produce offerings to our metro New York market and any intangible assets that do not qualify for separate recognition. The Company reflected net sales of $27,831 and $66,451 for the thirteen weeks and thirty-nine weeks ended September 25, 2020, respectively, and an operating loss of $1,177 and $5,646 for the thirteen weeks and thirty-nine weeks ended September 25, 2020, respectively, in its consolidated statement of operations related to the Sid Wainer acquisition. The table below presents unaudited pro forma consolidated income statement information of the Company as if the Sid Wainer acquisition had occurred on December 29, 2018. The pro forma results were prepared from financial information obtained from the sellers of the business, as well as information obtained during the due diligence process associated with the acquisition. The pro forma information is not necessarily indicative of the Company’s results of operations had the acquisition been completed on the above date, nor is it necessarily indicative of the Company’s future results. The pro forma information does not reflect any cost savings from operating efficiencies or synergies that could result from the acquisition, any incremental costs for Sid Wainer transitioning to become a public company, and also does not reflect additional revenue opportunities following the acquisition. The pro forma information reflects amortization and depreciation of the Sid Wainer acquisition at their respective fair values. Thirteen Weeks Ended Thirty-Nine Weeks Ended September 25, 2020 September 27, 2019 September 25, 2020 September 27, 2019 Net sales $ 254,030 $ 461,034 $ 842,735 $ 1,331,487 (Loss) income before income taxes (16,631) 8,613 (70,999) 19,404 Additionally, during fiscal 2020, the Company paid approximately $16,356 for a specialty center-of-the plate distributor in New England. The table below sets forth the purchase price allocation of these acquisitions: Sid Wainer Other Acquisitions Current assets $ 22,960 $ 6,172 Customer relationships — 6,200 Trademarks 3,500 700 Goodwill 11,571 5,291 Fixed assets 19,425 308 Right-of-use assets 8,259 1,019 Lease liabilities (8,259) (1,019) Current liabilities (11,294) (932) Earn-out liability (2,081) (1,383) Total consideration $ 44,081 $ 16,356 The Company recognized professional fees of $435 in other operating expenses related to the acquisitions in the first quarter of fiscal 2020. |
Inventories
Inventories | 9 Months Ended |
Sep. 25, 2020 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories consist primarily of finished product and are reflected net of adjustments for shrinkage, excess and obsolescence totaling $8,118 and $1,937 at September 25, 2020 and December 27, 2019, respectively. The Company incurred estimated inventory charges of approximately $9,800 related to inventory obsolescence due to COVID-19 during fiscal 2020. |
Equipment, Leasehold Improvemen
Equipment, Leasehold Improvements and Software | 9 Months Ended |
Sep. 25, 2020 | |
Property, Plant and Equipment [Abstract] | |
Equipment, Leasehold Improvements and Software | Equipment, Leasehold Improvements and Software Equipment, leasehold improvements and software as of September 25, 2020 and December 27, 2019 consisted of the following: Useful Lives September 25, 2020 December 27, 2019 Land Indefinite $ 5,020 $ 1,170 Buildings 20 years 15,685 1,360 Machinery and equipment 5 - 10 years 24,770 21,718 Computers, data processing and other equipment 3 - 7 years 14,111 12,686 Software 3 - 7 years 33,024 29,305 Leasehold improvements 1 - 40 years 71,531 70,903 Furniture and fixtures 7 years 3,433 3,309 Vehicles 5 - 7 years 20,103 6,410 Other 7 years 96 95 Construction-in-process 9,132 9,200 196,905 156,156 Less: accumulated depreciation and amortization (79,941) (63,310) Equipment, leasehold improvements and software, net $ 116,964 $ 92,846 Construction-in-process at September 25, 2020 and December 27, 2019 related primarily to the implementation of the Company’s Enterprise Resource Planning system. The net book value of equipment financed under finance leases at September 25, 2020 and December 27, 2019 was $14,623 and $3,905, respectively. The components of depreciation and amortization expense were as follows: Thirteen Weeks Ended Thirty-Nine Weeks Ended September 25, 2020 September 27, 2019 September 25, 2020 September 27, 2019 Depreciation expense $ 3,792 $ 2,558 $ 11,023 $ 6,793 Software amortization $ 1,247 $ 926 $ 3,691 $ 2,746 $ 5,039 $ 3,484 $ 14,714 $ 9,539 |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 9 Months Ended |
Sep. 25, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets COVID-19 has had a material impact on the Company’s customers. In an effort to limit the spread of the virus, federal, state and local governments implemented measures that resulted in the closure of non-essential businesses in many of the markets the Company serves, which forced its customers in those markets to either transition their establishments to take-out service, delivery service or temporarily cease operations. Beginning in mid-March these actions led to a significant decrease in demand for the Company’s products. The adverse impact to the Company’s customer base and market capitalization at the onset of COVID-19 were considered triggering events during the first quarter of fiscal 2020 and accordingly, the Company performed interim goodwill and long-lived asset quantitative impairment tests as of March 27, 2020. Goodwill Impairment Test The Company estimated the fair value of its reporting units using an income approach that incorporates the use of a discounted cash flow model that involves many management assumptions that are based upon future growth projections which include estimates of COVID-19’s impact on our business. Assumptions include estimates of future revenues, growth rates which take into account estimated inflation rates, estimates of future levels of gross profit and operating profit, projected capital expenditures and discount rates based upon industry and competitor analyses. On the basis of these assumptions, the Company determined that the fair values of its reporting units exceeded the net carry values of their assets and liabilities by approximately $400,000, $19,000 and $14,000 for the East Coast, Midwest and West Coast reporting units, respectively. As such, goodwill was not impaired as of March 27, 2020. Management determined that there were no triggering events during the second or third quarters of fiscal 2020 that would require additional goodwill impairment testing. Long-lived Impairment Test Long-lived assets, including other intangible assets, were tested for recoverability at the asset group level. The Company estimated the net undiscounted cash flows expected to be generated from the asset group over the expected useful of the asset group’s primary asset. Key assumptions include future revenues, growth rates, estimates of future levels of gross profit and operating profit and projected capital expenditures necessary to maintain the operating capacity of each asset group. On the basis of these assumptions, the Company determined that the undiscounted cash flows for each of the Company’s asset groups exceeded their respective carry values and therefore long-lived assets were not impaired as of March 27, 2020. Management determined that there were no triggering events during the second or third quarters of fiscal 2020 that would require additional testing. Although the Company’s interim goodwill and long-lived asset impairment tests indicated no impairment existed, the impacts of COVID-19 on our business are uncertain and will depend on future developments, and as such, it is possible that another triggering event could occur that under certain circumstances could cause us to recognize an impairment charge in the future. The changes in the carrying amount of goodwill are presented as follows: Carrying amount as of December 27, 2019 $ 197,743 Acquisitions 16,862 Foreign currency translation (24) Carrying amount as of September 25, 2020 $ 214,581 Other intangible assets consist of customer relationships being amortized over a period ranging from four one two Other intangible assets as of September 25, 2020 and December 27, 2019 consisted of the following: September 25, 2020 Gross Carrying Amount Accumulated Amortization Net Amount Customer relationships $ 141,399 $ (52,720) $ 88,679 Non-compete agreements 8,579 (7,677) 902 Trademarks 68,685 (19,273) 49,412 Total $ 218,663 $ (79,670) $ 138,993 December 27, 2019 Customer relationships $ 135,226 $ (45,454) $ 89,772 Non-compete agreements 8,579 (7,479) 1,100 Trademarks 64,505 (16,626) 47,879 Total $ 208,310 $ (69,559) $ 138,751 The Company occasionally makes small, tuck-in acquisitions that are immaterial, both individually and in the aggregate. Therefore, increases in goodwill and gross intangible assets per the above tables may not agree to the increases of these assets as shown for specific acquisitions in Note 5 “Acquisitions.” Amortization expense for other intangibles was $3,391 and $3,301 for the thirteen weeks ended September 25, 2020 and September 27, 2019, respectively, and $10,111 and $9,485 for the thirty-nine weeks ended September 25, 2020 and September 27, 2019, respectively. Estimated amortization expense for other intangible assets for the remainder of the fiscal year ending December 25, 2020 and each of the next four fiscal years and thereafter is as follows: 2020 $ 3,395 2021 13,574 2022 12,794 2023 11,766 2024 11,423 Thereafter 86,041 Total $ 138,993 |
Debt Obligations
Debt Obligations | 9 Months Ended |
Sep. 25, 2020 | |
Debt Disclosure [Abstract] | |
Debt Obligations | Debt Obligations Debt obligations as of September 25, 2020 and December 27, 2019 consisted of the following: September 25, 2020 December 27, 2019 Senior secured term loans $ 201,981 $ 238,129 Convertible senior notes 150,000 150,000 Asset-based loan facility 40,000 — Convertible unsecured note 4,000 4,000 Finance lease and other financing obligations 14,834 3,905 Deferred finance fees and original issue discount (8,275) (9,207) Total debt obligations 402,540 386,827 Less: current installments (5,904) (721) Total debt obligations excluding current installments $ 396,636 $ 386,106 On June 8, 2020, the Company entered into a sixth amendment (the “Sixth Amendment”) to its senior secured term loan credit agreement (the “Credit Agreement”). Upon the consent of the lenders, the Sixth Amendment converted a portion of the term loans then outstanding of $238,129 (the “Term Loans”) into a new tranche of term loans (the “2025 Tranche”) which among other things extended the maturity date by three years and increased the fixed-rate portion of interest charged by 200 basis points. The portion of the Term Loans that did not convert (the “2022 Tranche”) retained the maturity date and interest rate in effect prior to the Sixth Amendment.The Company made a prepayment of $35,719 on the 2025 Tranche immediately after it was established. The following table summarizes the key terms of the Term Loans as of September 25, 2020: Term Loans Principal Outstanding Interest Rate Maturity Date Scheduled Principal Payments 2022 Tranche $ 31,166 LIBOR + 3.5% June 22, 2022 none 2025 Tranche $ 170,815 LIBOR + 5.5% June 22, 2025 0.25% per quarter The 2025 Tranche has a springing maturity date of June 22, 2024 if, as of that date, the Company’s 1.875% convertible senior notes maturing on December 1, 2024 have not been repaid or refinanced by debt having a maturity date on or after December 23, 2025. The Sixth Amendment was accounted for as a debt modification. The Company incurred lender fees of $856 which were capitalized as debt issuance costs. Third-party transaction costs of $1,233 were expensed as incurred. The Sixth Amendment introduced a minimum liquidity covenant which requires the Company to maintain at least $35,000 of liquidity as of the last day of any fiscal quarter where EBITDA, as defined in the Credit Agreement, is less than $10,000. The Company had minimum liquidity, as defined in the Credit Agreement, of $250,392 as of September 25, 2020. As of September 25, 2020, the Company was in compliance with all debt covenants and the Company had reserved $20,141 of the asset-based loan facility (“ABL Facility”) for the issuance of letters of credit. As of September 25, 2020, funds totaling $44,275 were available for borrowing under the ABL Facility. At September 25, 2020, the weighted average interest rate charged on the Company’s senior secured term loan was approximately 5.3% and the interest rate charged on the Company’s ABL Facility was approximately 1.9%. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 25, 2020 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | Stockholders’ Equity Preferred Stock Purchase Rights On March 22, 2020, the Company’s board of directors approved a limited duration Preferred Stock Purchase Rights Agreement (the “Rights Agreement”). Under the Rights Agreement, the board of directors approved a dividend of one preferred share purchase right (a “Right”) for each share outstanding share of the Company’s common stock to purchase one one-thousandth of a share of Series A Preferred Stock of the Company at a price of $40.00 per Unit of Preferred Stock, subject to adjustment as provided in the Rights Agreement. The Rights will expire on March 21, 2021, unless the Rights are earlier redeemed or exchanged by the Company or upon the occurrence of certain transactions. Public Common Stock Offering On May 14, 2020, the Company completed a public offering of 5,769,231 shares of its common stock at a price of $13.00 per share to the underwriters, to be reoffered by the underwriters at variable prices per share, which resulted in net proceeds of approximately $74,691 after deducting underwriters’ fees, commissions and transaction expenses. In addition, the Company granted a 30-day option to purchase up to an additional 865,384 shares of its common stock at a price of $13.00 per share to the underwriters, to be reoffered by the underwriters at variable prices per share. The option was fully exercised on June 2, 2020 and resulted in additional proceeds of $11,250. Equity Awards The following table reflects the activity of RSAs during the thirty-nine weeks ended September 25, 2020: Shares Weighted Average Unvested at December 27, 2019 740,609 $ 27.68 Granted 1,003,671 17.51 Vested (215,367) 24.22 Forfeited (42,678) 24.45 Unvested at September 25, 2020 1,486,235 $ 21.49 The Company granted 1,003,671 RSAs to its employees and directors at a weighted average grant date fair value of $17.51 during the thirty-nine weeks ended September 25, 2020. These awards are a mix of time-, market- and performance-based grants that generally vest over a range of periods up to four years. The Company recognized expense totaling $2,075 and $908 on its RSAs during the thirteen weeks ended September 25, 2020 and September 27, 2019, respectively, and $4,925 and $2,797 during the thirty-nine weeks ended September 25, 2020 and September 27, 2019, respectively. At September 25, 2020, the total unrecognized compensation cost for unvested RSAs was $13,275 and the weighted-average remaining period was approximately 2.0 years. Of this total, $11,048 related to RSAs with time-based vesting provisions and $2,227 related to RSAs with performance-based vesting provisions. At September 25, 2020, the weighted-average remaining period for time-based vesting and performance-based vesting RSAs were approximately 2.0 years and 2.2 years, respectively. The Company’s stock options fully vested during the first quarter of fiscal 2019. The Company recognized expense of zero and $114 on stock options during the thirteen weeks and thirty-nine weeks ended September 27, 2019, respectively. No share-based compensation expense related to the Company’s RSAs or stock options has been capitalized. As of September 25, 2020, there were 1,254,514 shares available for grant under the 2019 Omnibus Equity Incentive Plan. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 25, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes In response to the COVID-19 pandemic, the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) was signed into law on March 27, 2020. The legislation provides temporary changes to the extent to which companies can carryback net operating losses, changes to interest expense deduction limitations and other tax relief provisions. The Company’s effective income tax rate was 34.5% and 27.5% for the thirty-nine weeks ended September 25, 2020 and September 27, 2019, respectively. The higher effective tax rate in the current fiscal year is primarily related to the Company’s current net loss forecast for fiscal 2020 which, under the CARES Act, allows the Company to claim Federal tax refunds against prior year taxes paid, including taxes paid in fiscal 2015 and 2017, both of which were at statutory tax rates of 35%. The Company’s income tax provision reflects the impact of an expected income tax refund receivable of $20,973 as of September 25, 2020 which is reflected in prepaid expenses and other current assets on the Company’s consolidated balance sheet. |
Related Parties
Related Parties | 9 Months Ended |
Sep. 25, 2020 | |
Related Party Transactions [Abstract] | |
Related Parties | Related Parties The Chefs’ Warehouse Mid-Atlantic, LLC, a subsidiary of the Company, leases a distribution facility that is 100% owned by entities controlled by Christopher Pappas, the Company’s chairman, president and chief executive officer, and John Pappas, the Company’s vice chairman and one of its directors, and are deemed to be affiliates of these individuals. Expense related to this facility totaled $124 and $108 during the thirteen weeks ended September 25, 2020 and September 27, 2019, respectively, and $365 and $325 during the thirty-nine weeks ended September 25, 2020 and September 27, 2019, respectively. This lease was amended during the first quarter of fiscal 2020 and expires on September 30, 2023. |
Supplemental Disclosures of Cas
Supplemental Disclosures of Cash Flow Information | 9 Months Ended |
Sep. 25, 2020 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Disclosures of Cash Flow Information | Supplemental Disclosures of Cash Flow Information Thirty-Nine Weeks Ended September 25, 2020 September 27, 2019 Supplemental cash flow disclosures: Cash paid for income taxes, net of cash received $ 308 $ 6,045 Cash paid for interest, net of cash received $ 12,741 $ 12,477 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 20,206 $ 18,575 Operating cash flows from finance leases $ 411 $ 65 ROU assets obtained in exchange for lease liabilities: Operating leases $ 5,800 $ 154,330 Finance leases $ 14,017 $ 1,820 Other non-cash investing and financing activities: Convertible notes issued for acquisitions $ — $ 4,000 Contingent earn-out liabilities for acquisitions $ 3,464 $ 7,929 |
Operations and Basis of Prese_2
Operations and Basis of Presentation (Policies) | 9 Months Ended |
Sep. 25, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Fiscal Period | The Company’s quarterly periods end on the thirteenth Friday of each quarter. Every six to seven years, the Company will add a fourteenth week to its fourth quarter to more closely align its year-end to the calendar year. |
Segment Reporting | The Company’s business consists of three operating segments: East Coast, Midwest and West Coast that aggregate into one reportable segment, foodservice distribution, which is concentrated primarily in the United States. |
Consolidation | The consolidated financial statements include all the accounts of the Company and its direct and indirect wholly-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated. |
Unaudited Interim Financial Statements | The accompanying unaudited consolidated financial statements and the related interim information contained within the notes to such unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and the applicable rules of the Securities and Exchange Commission (“SEC”) for interim information and quarterly reports on Form 10-Q. Accordingly, they do not include all the information and disclosures required by GAAP for complete financial statements. These unaudited consolidated financial statements and related notes should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto for the fiscal year ended December 27, 2019 filed as part of the Company’s Annual Report on Form 10-K, as filed with the SEC on February 24, 2020. The unaudited consolidated financial statements appearing in this Form 10-Q have been prepared on the same basis as the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K, as filed with the SEC on February 24, 2020, and in the opinion of management, include all normal recurring adjustments that are necessary for the fair statement of the Company’s interim period results. The year-end consolidated balance sheet data was derived from the audited financial statements but does not include all disclosures required by GAAP. Due to seasonal fluctuations, COVID-19 and other factors, the results of operations for the thirteen and thirty-nine weeks ended September 25, 2020 are not necessarily indicative of the results to be expected for the full year. |
Use of Estimates | The preparation of financial statements in conformity with GAAP requires management to make significant estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from management’s estimates. |
Guidance Adopted in Fiscal 2020 and Guidance Not Yet Adopted | Guidance Adopted in Fiscal 2020 Measurement of Credit Losses on Financial Instruments: In June 2016 and as further amended in November 2018, the Financial Accounting Standards Board (the “FASB”) issued guidance which requires entities to use a forward-looking expected loss model to estimate credit losses. It also requires additional disclosure related to credit quality of trade and other receivables, including information related to management’s estimate of credit allowances. The Company adopted this guidance on December 28, 2019. The Company analyzes customer creditworthiness, accounts receivable balances, payment history, payment terms and historical bad debt levels when evaluating the adequacy of its allowance for doubtful accounts. In instances where a reserve has been recorded for a particular customer, future sales to the customer are either conducted using cash-on-delivery terms or the account is closely monitored so that agreed-upon payments are received prior to orders being released. A failure to pay results in held or cancelled orders. The Company also estimates receivables that will ultimately be uncollectible based upon historical write-off experience. Management incorporates current macro-economic factors in existence as of the balance sheet date that may impact the food-away-from-home industry and/or its customers, and specifically, beginning in the first quarter of fiscal 2020, the impact of COVID-19. Adoption of this guidance did not have a material effect on the Company’s consolidated financial statements. Leases: In April 2020, the FASB issued guidance describing approaches entities should follow when accounting for lease concessions negotiated due to the effects of COVID-19. The Company has negotiated rent deferrals with certain lessors that do not materially modify the amount of consideration due under the original contract terms. Consistent with the guidance, the Company elected to recognize such rent deferrals as accrued expenses. The Company continues to recognize expense during the deferral period. Guidance Not Yet Adopted Simplifying the Accounting for Income Taxes: In December 2019, the FASB issued guidance that eliminates certain exceptions related to the approach for intraperiod tax allocations, the methodology for calculating income taxes in an interim period and other simplifications and clarifications. The guidance will be effective for fiscal years beginning after December 15, 2020. Early adoption is permitted. The Company expects to adopt this guidance when effective and adoption will have an immaterial impact on its consolidated financial statements. Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity: In August 2020, the FASB issued guidance that simplifies the accounting models for financial instruments with characteristics of debt and equity. The amendments in the guidance result in fewer instances in which an embedded conversion feature must be accounted for separately from its host contract. This guidance will be effective for fiscal years beginning after December 15, 2021. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020. The Company expects to adopt this guidance on December 26, 2020 and adoption is not expected to have a material impact on its consolidated financial statements. |
Revenue Recognition, Deferred Revenue, Right of Return, Cost of Sales | Revenues from product sales are recognized at the point at which control of each product is transferred to the customer. The Company’s contracts contain performance obligations which are satisfied when customers have physical possession of each product. The majority of customer orders are fulfilled within a day and customer payment terms are typically 20 to 60 days from delivery. Shipping and handling activities are costs to fulfill the Company’s performance obligations. These costs are expensed as incurred and presented within selling, general and administrative expenses on the consolidated statements of operations. The Company offers certain sales incentives to customers in the form of rebates or discounts. These sales incentives are accounted as variable consideration. The Company estimates these amounts based on the expected amount to be provided to customers and records a corresponding reduction in revenue. The Company does not expect a significant reversal in the amount of cumulative revenue recognized. Sales tax billed to customers is not included in revenue but rather recorded as a liability owed to the respective taxing authorities at the time the sale is recognized. |
Contract Costs and Selling, General and Administrative Expenses | Sales commissions are expensed when incurred because the amortization period is one year or less. These costs are presented within selling, general and administrative expenses on the Company’s consolidated statements of operations. |
Other Operating Expenses | Other operating expenses includes expenses primarily related to changes in the fair value of the Company’s earn-out liabilities, gains and losses on asset disposals, asset impairments and certain third-party deal costs incurred in connection with business acquisitions or financing arrangements. |
Reclassifications (Tables)
Reclassifications (Tables) | 9 Months Ended |
Sep. 25, 2020 | |
Accounting Changes and Error Corrections [Abstract] | |
Schedule of the Impact of Reclassifications | The aggregate impact of the above reclassifications on prior periods are as follows: Thirteen Weeks Ended Thirty-Nine Weeks Ended September 27, 2019 September 27, 2019 As Reported Reclass As Restated As Reported Reclass As Restated Net sales $ 396,880 $ — $ 396,880 $ 1,165,327 $ — $ 1,165,327 Cost of sales 294,887 4,773 299,660 866,670 13,689 880,359 Gross profit 101,993 (4,773) 97,220 298,657 (13,689) 284,968 Selling, general and administrative expenses 91,345 (7,385) 83,960 266,323 (19,306) 247,017 Other operating expenses — 2,636 2,636 — 5,681 5,681 Total operating expenses 91,345 (4,749) 86,596 266,323 (13,625) 252,698 Operating income 10,648 (24) 10,624 32,334 (64) 32,270 Interest expense 4,517 — 4,517 13,913 — 13,913 Loss on asset disposal 24 (24) — 64 (64) — Income before income taxes 6,107 — 6,107 18,357 — 18,357 Provision for income tax expense 1,682 — 1,682 5,052 — 5,052 Net income $ 4,425 $ — $ 4,425 $ 13,305 $ — $ 13,305 The changes to basic and diluted weighted average common shares outstanding and corresponding impacts to basic and diluted net loss per common share for the thirteen and twenty-six weeks ended June 26, 2020 were follows: Thirteen Weeks Ended Twenty-Six Weeks Ended June 26, 2020 June 26, 2020 As Reported As Restated As Reported As Restated Net loss per share: Basic $ (0.57) $ (0.62) $ (1.05) $ (1.10) Diluted $ (0.57) $ (0.62) $ (1.05) $ (1.10) Weighted average common shares: Basic 35,759,193 32,698,295 32,672,876 31,150,883 Diluted 35,759,193 32,698,295 32,672,876 31,150,883 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 25, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of Revenue | The following table presents the Company’s net sales disaggregated by principal product category: Thirteen Weeks Ended Thirty-Nine Weeks Ended September 25, 2020 September 27, 2019 September 25, 2020 September 27, 2019 Center-of-the-Plate $ 115,570 45.5 % $ 176,778 44.5 % $ 395,224 47.6 % $ 516,907 44.4 % Dry Goods 31,495 12.4 % 65,379 16.5 % 113,480 13.7 % 193,518 16.6 % Pastry 27,618 10.9 % 53,579 13.5 % 92,427 11.1 % 160,316 13.8 % Cheese and Charcuterie 33,329 13.1 % 40,500 10.2 % 83,996 10.1 % 117,073 10.0 % Produce 24,172 9.5 % 4,875 1.2 % 60,240 7.3 % 13,255 1.1 % Dairy and Eggs 6,301 2.5 % 27,480 6.9 % 35,942 4.3 % 81,765 7.0 % Oils and Vinegars 9,487 3.7 % 20,487 5.2 % 31,082 3.7 % 60,117 5.2 % Kitchen Supplies 6,058 2.4 % 7,802 2.0 % 17,566 2.2 % 22,376 1.9 % Total $ 254,030 100 % $ 396,880 100 % $ 829,957 100 % $ 1,165,327 100 % |
Net (Loss) Income per Share (Ta
Net (Loss) Income per Share (Tables) | 9 Months Ended |
Sep. 25, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of computation of basic and diluted net income per share | The following table sets forth the computation of basic and diluted net (loss) income per common share: Thirteen Weeks Ended Thirty-Nine Weeks Ended September 25, 2020 September 27, 2019 September 25, 2020 September 27, 2019 Net (loss) income per share: Basic $ (0.31) $ 0.15 $ (1.39) $ 0.45 Diluted $ (0.31) $ 0.15 $ (1.39) $ 0.45 Weighted average common shares: Basic 36,283,883 29,549,308 32,868,162 29,511,143 Diluted 36,283,883 29,954,837 32,868,162 29,723,609 |
Schedule of reconciliation of net income per common share | Reconciliation of net (loss) income per common share: Thirteen Weeks Ended Thirty-Nine Weeks Ended September 25, 2020 September 27, 2019 September 25, 2020 September 27, 2019 Numerator: Net (loss) income $ (11,427) $ 4,425 $ (45,846) $ 13,305 Denominator: Weighted average basic common shares outstanding 36,283,883 29,549,308 32,868,162 29,511,143 Dilutive effect of stock options and unvested common shares — 405,529 — 212,466 Weighted average diluted common shares outstanding 36,283,883 29,954,837 32,868,162 29,723,609 |
Schedule of dilutive securities that have been excluded from the calculation of diluted net income per common share | Potentially dilutive securities that have been excluded from the calculation of diluted net (loss) income per common share because the effect is anti-dilutive are as follows: Thirteen Weeks Ended Thirty-Nine Weeks Ended September 25, 2020 September 27, 2019 September 25, 2020 September 27, 2019 Restricted share awards (“RSAs”) 389,163 330,696 393,905 122,876 Stock options 115,639 — 115,639 — Convertible notes 3,484,788 91,053 3,484,788 91,053 |
Schedule of Error Correction and Prior Period Adjustments | The aggregate impact of the above reclassifications on prior periods are as follows: Thirteen Weeks Ended Thirty-Nine Weeks Ended September 27, 2019 September 27, 2019 As Reported Reclass As Restated As Reported Reclass As Restated Net sales $ 396,880 $ — $ 396,880 $ 1,165,327 $ — $ 1,165,327 Cost of sales 294,887 4,773 299,660 866,670 13,689 880,359 Gross profit 101,993 (4,773) 97,220 298,657 (13,689) 284,968 Selling, general and administrative expenses 91,345 (7,385) 83,960 266,323 (19,306) 247,017 Other operating expenses — 2,636 2,636 — 5,681 5,681 Total operating expenses 91,345 (4,749) 86,596 266,323 (13,625) 252,698 Operating income 10,648 (24) 10,624 32,334 (64) 32,270 Interest expense 4,517 — 4,517 13,913 — 13,913 Loss on asset disposal 24 (24) — 64 (64) — Income before income taxes 6,107 — 6,107 18,357 — 18,357 Provision for income tax expense 1,682 — 1,682 5,052 — 5,052 Net income $ 4,425 $ — $ 4,425 $ 13,305 $ — $ 13,305 The changes to basic and diluted weighted average common shares outstanding and corresponding impacts to basic and diluted net loss per common share for the thirteen and twenty-six weeks ended June 26, 2020 were follows: Thirteen Weeks Ended Twenty-Six Weeks Ended June 26, 2020 June 26, 2020 As Reported As Restated As Reported As Restated Net loss per share: Basic $ (0.57) $ (0.62) $ (1.05) $ (1.10) Diluted $ (0.57) $ (0.62) $ (1.05) $ (1.10) Weighted average common shares: Basic 35,759,193 32,698,295 32,672,876 31,150,883 Diluted 35,759,193 32,698,295 32,672,876 31,150,883 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 25, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of changes in Level 3 contingent consideration liability | The following table presents the changes in Level 3 contingent earn-out liabilities: Fells Point Bassian Sid Wainer Other Acquisitions Total Balance December 27, 2019 $ 4,544 $ 7,957 $ — $ 2,197 $ 14,698 Acquisition value — — 2,081 1,383 3,464 Cash payments — (2,250) — (1,677) (3,927) Changes in fair value (4,544) (4,337) (1,581) (757) (11,219) Balance September 25, 2020 $ — $ 1,370 $ 500 $ 1,146 $ 3,016 |
Schedule of carrying value and fair value of the Company's convertible subordinated notes | The following table presents the carrying value and fair value of the Company’s convertible notes. In estimating the fair value of the convertible notes, the Company utilized Level 3 inputs including prevailing market interest rates to estimate the debt portion of the instrument and a Black Scholes valuation model to estimate the fair value of the conversion option. The Black Scholes model utilizes the market price of the Company’s common stock, estimates of the stock’s volatility and the prevailing risk-free interest rate in calculating the fair value estimate. September 25, 2020 December 27, 2019 Carrying Value Fair Value Carrying Value Fair Value Convertible Senior Notes $ 150,000 $ 141,048 $ 150,000 $ 165,000 Convertible Unsecured Note $ 4,000 $ 3,711 $ 4,000 $ 4,282 |
Acquisitions (Tables)
Acquisitions (Tables) | 9 Months Ended |
Sep. 25, 2020 | |
Business Combinations [Abstract] | |
Schedule of pro forma consolidated income statement information | The table below presents unaudited pro forma consolidated income statement information of the Company as if the Sid Wainer acquisition had occurred on December 29, 2018. The pro forma results were prepared from financial information obtained from the sellers of the business, as well as information obtained during the due diligence process associated with the acquisition. The pro forma information is not necessarily indicative of the Company’s results of operations had the acquisition been completed on the above date, nor is it necessarily indicative of the Company’s future results. The pro forma information does not reflect any cost savings from operating efficiencies or synergies that could result from the acquisition, any incremental costs for Sid Wainer transitioning to become a public company, and also does not reflect additional revenue opportunities following the acquisition. The pro forma information reflects amortization and depreciation of the Sid Wainer acquisition at their respective fair values. Thirteen Weeks Ended Thirty-Nine Weeks Ended September 25, 2020 September 27, 2019 September 25, 2020 September 27, 2019 Net sales $ 254,030 $ 461,034 $ 842,735 $ 1,331,487 (Loss) income before income taxes (16,631) 8,613 (70,999) 19,404 |
Schedule of assets acquired and liabilities assumed | The table below sets forth the purchase price allocation of these acquisitions: Sid Wainer Other Acquisitions Current assets $ 22,960 $ 6,172 Customer relationships — 6,200 Trademarks 3,500 700 Goodwill 11,571 5,291 Fixed assets 19,425 308 Right-of-use assets 8,259 1,019 Lease liabilities (8,259) (1,019) Current liabilities (11,294) (932) Earn-out liability (2,081) (1,383) Total consideration $ 44,081 $ 16,356 |
Equipment, Leasehold Improvem_2
Equipment, Leasehold Improvements and Software (Tables) | 9 Months Ended |
Sep. 25, 2020 | |
Property, Plant and Equipment [Abstract] | |
Schedule of equipment, leasehold improvements and software | Equipment, leasehold improvements and software as of September 25, 2020 and December 27, 2019 consisted of the following: Useful Lives September 25, 2020 December 27, 2019 Land Indefinite $ 5,020 $ 1,170 Buildings 20 years 15,685 1,360 Machinery and equipment 5 - 10 years 24,770 21,718 Computers, data processing and other equipment 3 - 7 years 14,111 12,686 Software 3 - 7 years 33,024 29,305 Leasehold improvements 1 - 40 years 71,531 70,903 Furniture and fixtures 7 years 3,433 3,309 Vehicles 5 - 7 years 20,103 6,410 Other 7 years 96 95 Construction-in-process 9,132 9,200 196,905 156,156 Less: accumulated depreciation and amortization (79,941) (63,310) Equipment, leasehold improvements and software, net $ 116,964 $ 92,846 The components of depreciation and amortization expense were as follows: Thirteen Weeks Ended Thirty-Nine Weeks Ended September 25, 2020 September 27, 2019 September 25, 2020 September 27, 2019 Depreciation expense $ 3,792 $ 2,558 $ 11,023 $ 6,793 Software amortization $ 1,247 $ 926 $ 3,691 $ 2,746 $ 5,039 $ 3,484 $ 14,714 $ 9,539 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 9 Months Ended |
Sep. 25, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of goodwill | The changes in the carrying amount of goodwill are presented as follows: Carrying amount as of December 27, 2019 $ 197,743 Acquisitions 16,862 Foreign currency translation (24) Carrying amount as of September 25, 2020 $ 214,581 |
Schedule of other intangible assets | Other intangible assets as of September 25, 2020 and December 27, 2019 consisted of the following: September 25, 2020 Gross Carrying Amount Accumulated Amortization Net Amount Customer relationships $ 141,399 $ (52,720) $ 88,679 Non-compete agreements 8,579 (7,677) 902 Trademarks 68,685 (19,273) 49,412 Total $ 218,663 $ (79,670) $ 138,993 December 27, 2019 Customer relationships $ 135,226 $ (45,454) $ 89,772 Non-compete agreements 8,579 (7,479) 1,100 Trademarks 64,505 (16,626) 47,879 Total $ 208,310 $ (69,559) $ 138,751 |
Schedule of estimated future amortization expense | Estimated amortization expense for other intangible assets for the remainder of the fiscal year ending December 25, 2020 and each of the next four fiscal years and thereafter is as follows: 2020 $ 3,395 2021 13,574 2022 12,794 2023 11,766 2024 11,423 Thereafter 86,041 Total $ 138,993 |
Debt Obligations (Tables)
Debt Obligations (Tables) | 9 Months Ended |
Sep. 25, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of debt obligations | Debt obligations as of September 25, 2020 and December 27, 2019 consisted of the following: September 25, 2020 December 27, 2019 Senior secured term loans $ 201,981 $ 238,129 Convertible senior notes 150,000 150,000 Asset-based loan facility 40,000 — Convertible unsecured note 4,000 4,000 Finance lease and other financing obligations 14,834 3,905 Deferred finance fees and original issue discount (8,275) (9,207) Total debt obligations 402,540 386,827 Less: current installments (5,904) (721) Total debt obligations excluding current installments $ 396,636 $ 386,106 |
Schedule of term loans | The following table summarizes the key terms of the Term Loans as of September 25, 2020: Term Loans Principal Outstanding Interest Rate Maturity Date Scheduled Principal Payments 2022 Tranche $ 31,166 LIBOR + 3.5% June 22, 2022 none 2025 Tranche $ 170,815 LIBOR + 5.5% June 22, 2025 0.25% per quarter |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 9 Months Ended |
Sep. 25, 2020 | |
Stockholders' Equity Note [Abstract] | |
Schedule of restricted stock awards activity | The following table reflects the activity of RSAs during the thirty-nine weeks ended September 25, 2020: Shares Weighted Average Unvested at December 27, 2019 740,609 $ 27.68 Granted 1,003,671 17.51 Vested (215,367) 24.22 Forfeited (42,678) 24.45 Unvested at September 25, 2020 1,486,235 $ 21.49 |
Supplemental Disclosures of C_2
Supplemental Disclosures of Cash Flow Information (Tables) | 9 Months Ended |
Sep. 25, 2020 | |
Supplemental Cash Flow Elements [Abstract] | |
Schedule of supplemental disclosures of cash flow information | Thirty-Nine Weeks Ended September 25, 2020 September 27, 2019 Supplemental cash flow disclosures: Cash paid for income taxes, net of cash received $ 308 $ 6,045 Cash paid for interest, net of cash received $ 12,741 $ 12,477 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 20,206 $ 18,575 Operating cash flows from finance leases $ 411 $ 65 ROU assets obtained in exchange for lease liabilities: Operating leases $ 5,800 $ 154,330 Finance leases $ 14,017 $ 1,820 Other non-cash investing and financing activities: Convertible notes issued for acquisitions $ — $ 4,000 Contingent earn-out liabilities for acquisitions $ 3,464 $ 7,929 |
Operations and Basis of Prese_3
Operations and Basis of Presentation - Narrative (Details) $ in Thousands | 9 Months Ended |
Sep. 25, 2020USD ($)segment | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of operating segments | segment | 3 |
Number of reportable segments | segment | 1 |
Incremental bad debt expense related to COVID-19 pandemic | $ | $ 15,800 |
Incremental inventory obsolescence related to COVID-19 pandemic | $ | $ 9,800 |
Reclassifications (Details)
Reclassifications (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 25, 2020 | Jun. 26, 2020 | Mar. 27, 2020 | Sep. 27, 2019 | Jun. 28, 2019 | Mar. 29, 2019 | Sep. 25, 2020 | Sep. 27, 2019 | |
Reclassification [Line Items] | ||||||||
Net sales | $ 254,030 | $ 396,880 | $ 829,957 | $ 1,165,327 | ||||
Cost of sales | 193,393 | 299,660 | 639,687 | 880,359 | ||||
Gross profit | 60,637 | 97,220 | 190,270 | 284,968 | ||||
Selling, general and administrative expenses | 76,708 | 83,960 | 254,474 | 247,017 | ||||
Other operating expenses | (4,146) | 2,636 | (9,812) | 5,681 | ||||
Total operating expenses | 86,596 | 252,698 | ||||||
Operating (loss) income | (11,925) | 10,624 | (54,392) | 32,270 | ||||
Interest expense | 4,706 | 4,517 | 15,602 | 13,913 | ||||
Loss on asset disposal | 52 | 64 | ||||||
(Loss) income before income taxes | (16,631) | 6,107 | (69,994) | 18,357 | ||||
Provision for income tax expense | (5,204) | 1,682 | (24,148) | 5,052 | ||||
Net (loss) income | $ (11,427) | $ (20,334) | $ (14,085) | 4,425 | $ 7,746 | $ 1,134 | $ (45,846) | 13,305 |
As Reported | ||||||||
Reclassification [Line Items] | ||||||||
Net sales | 396,880 | 1,165,327 | ||||||
Cost of sales | 294,887 | 866,670 | ||||||
Gross profit | 101,993 | 298,657 | ||||||
Selling, general and administrative expenses | 91,345 | 266,323 | ||||||
Other operating expenses | 0 | 0 | ||||||
Total operating expenses | 91,345 | 266,323 | ||||||
Operating (loss) income | 10,648 | 32,334 | ||||||
Interest expense | 4,517 | 13,913 | ||||||
Loss on asset disposal | 24 | 64 | ||||||
(Loss) income before income taxes | 6,107 | 18,357 | ||||||
Provision for income tax expense | 1,682 | 5,052 | ||||||
Net (loss) income | 4,425 | 13,305 | ||||||
Reclass | ||||||||
Reclassification [Line Items] | ||||||||
Net sales | 0 | 0 | ||||||
Cost of sales | 4,773 | 13,689 | ||||||
Gross profit | (4,773) | (13,689) | ||||||
Selling, general and administrative expenses | (7,385) | (19,306) | ||||||
Other operating expenses | 2,636 | 5,681 | ||||||
Total operating expenses | (4,749) | (13,625) | ||||||
Operating (loss) income | (24) | (64) | ||||||
Interest expense | 0 | 0 | ||||||
Loss on asset disposal | (24) | (64) | ||||||
(Loss) income before income taxes | 0 | 0 | ||||||
Provision for income tax expense | 0 | 0 | ||||||
Net (loss) income | $ 0 | $ 0 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 25, 2020 | Sep. 27, 2019 | Sep. 25, 2020 | Sep. 27, 2019 | Dec. 27, 2019 | |
Disaggregation of Revenue [Line Items] | |||||
Deferred revenues | $ 993 | $ 993 | $ 1,345 | ||
Refund liability | 208 | 208 | 314 | ||
Right to recover product | $ 128 | $ 128 | $ 194 | ||
Maximum amortization period, capitalized contract costs | 1 year | 1 year | |||
Cost of sales | $ 193,393 | $ 299,660 | $ 639,687 | $ 880,359 | |
Food Processing | |||||
Disaggregation of Revenue [Line Items] | |||||
Cost of sales | $ 4,001 | $ 4,773 | $ 12,708 | $ 13,689 | |
Minimum | |||||
Disaggregation of Revenue [Line Items] | |||||
Payment term for contracts with customers | 20 days | ||||
Maximum | |||||
Disaggregation of Revenue [Line Items] | |||||
Payment term for contracts with customers | 60 days |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Schedule of Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 25, 2020 | Sep. 27, 2019 | Sep. 25, 2020 | Sep. 27, 2019 | |
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 254,030 | $ 396,880 | $ 829,957 | $ 1,165,327 |
Net Sales | Product Concentration Risk | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of total Net sales | 100.00% | 100.00% | 100.00% | 100.00% |
Center-of-the-Plate | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 115,570 | $ 176,778 | $ 395,224 | $ 516,907 |
Center-of-the-Plate | Net Sales | Product Concentration Risk | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of total Net sales | 45.50% | 44.50% | 47.60% | 44.40% |
Dry Goods | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 31,495 | $ 65,379 | $ 113,480 | $ 193,518 |
Dry Goods | Net Sales | Product Concentration Risk | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of total Net sales | 12.40% | 16.50% | 13.70% | 16.60% |
Pastry | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 27,618 | $ 53,579 | $ 92,427 | $ 160,316 |
Pastry | Net Sales | Product Concentration Risk | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of total Net sales | 10.90% | 13.50% | 11.10% | 13.80% |
Cheese and Charcuterie | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 33,329 | $ 40,500 | $ 83,996 | $ 117,073 |
Cheese and Charcuterie | Net Sales | Product Concentration Risk | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of total Net sales | 13.10% | 10.20% | 10.10% | 10.00% |
Produce | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 24,172 | $ 4,875 | $ 60,240 | $ 13,255 |
Produce | Net Sales | Product Concentration Risk | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of total Net sales | 9.50% | 1.20% | 7.30% | 1.10% |
Dairy and Eggs | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 6,301 | $ 27,480 | $ 35,942 | $ 81,765 |
Dairy and Eggs | Net Sales | Product Concentration Risk | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of total Net sales | 2.50% | 6.90% | 4.30% | 7.00% |
Oils and Vinegars | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 9,487 | $ 20,487 | $ 31,082 | $ 60,117 |
Oils and Vinegars | Net Sales | Product Concentration Risk | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of total Net sales | 3.70% | 5.20% | 3.70% | 5.20% |
Kitchen Supplies | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 6,058 | $ 7,802 | $ 17,566 | $ 22,376 |
Kitchen Supplies | Net Sales | Product Concentration Risk | ||||
Disaggregation of Revenue [Line Items] | ||||
Percentage of total Net sales | 2.40% | 2.00% | 2.20% | 1.90% |
Net (Loss) Income per Share - C
Net (Loss) Income per Share - Computation of Basic and Diluted Earnings per Share (Details) - $ / shares | 3 Months Ended | 9 Months Ended | ||
Sep. 25, 2020 | Sep. 27, 2019 | Sep. 25, 2020 | Sep. 27, 2019 | |
Net (loss) income per share: | ||||
Basic (in dollars per share) | $ (0.31) | $ 0.15 | $ (1.39) | $ 0.45 |
Diluted (in dollars per share) | $ (0.31) | $ 0.15 | $ (1.39) | $ 0.45 |
Weighted average common shares: | ||||
Basic (in shares) | 36,283,883 | 29,549,308 | 32,868,162 | 29,511,143 |
Diluted (in shares) | 36,283,883 | 29,954,837 | 32,868,162 | 29,723,609 |
Net (Loss) Income per Share - S
Net (Loss) Income per Share - Schedule of Reconciliation of Earnings per Share (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 25, 2020 | Jun. 26, 2020 | Mar. 27, 2020 | Sep. 27, 2019 | Jun. 28, 2019 | Mar. 29, 2019 | Sep. 25, 2020 | Sep. 27, 2019 | |
Numerator: | ||||||||
Net (loss) income | $ (11,427) | $ (20,334) | $ (14,085) | $ 4,425 | $ 7,746 | $ 1,134 | $ (45,846) | $ 13,305 |
Earnings Per Share, Basic and Diluted, Other Disclosures [Abstract] | ||||||||
Weighted average basic common shares outstanding (in shares) | 36,283,883 | 29,549,308 | 32,868,162 | 29,511,143 | ||||
Dilutive effect of stock options and unvested common shares (in shares) | 0 | 405,529 | 0 | 212,466 | ||||
Weighted average diluted common shares outstanding (in shares) | 36,283,883 | 29,954,837 | 32,868,162 | 29,723,609 |
Net (Loss) Income per Share -_2
Net (Loss) Income per Share - Schedule of Potentially Dilutive Securities Excluded from Calculation of Diluted Net Income per Share (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 25, 2020 | Sep. 27, 2019 | Sep. 25, 2020 | Sep. 27, 2019 | |
Restricted share awards (“RSAs”) | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Anti-dilutive shares | 389,163 | 330,696 | 393,905 | 122,876 |
Stock options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Anti-dilutive shares | 115,639 | 0 | 115,639 | 0 |
Convertible notes | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Anti-dilutive shares | 3,484,788 | 91,053 | 3,484,788 | 91,053 |
Net (Loss) Income per Share -_3
Net (Loss) Income per Share - Schedule of Error Correction and Prior Period Adjustments (Details) - $ / shares | May 14, 2020 | Sep. 25, 2020 | Jun. 26, 2020 | Sep. 27, 2019 | Jun. 26, 2020 | Sep. 25, 2020 | Sep. 27, 2019 |
Net loss per share: | |||||||
Basic (in dollars per share) | $ (0.31) | $ 0.15 | $ (1.39) | $ 0.45 | |||
Diluted (in dollars per share) | $ (0.31) | $ 0.15 | $ (1.39) | $ 0.45 | |||
Weighted average common shares: | |||||||
Basic (in shares) | 36,283,883 | 29,549,308 | 32,868,162 | 29,511,143 | |||
Diluted (in shares) | 36,283,883 | 29,954,837 | 32,868,162 | 29,723,609 | |||
Error In Calculation Of Basic And Diluted Weighted Average Common Shares Outstanding | |||||||
Net loss per share: | |||||||
Basic (in dollars per share) | $ (0.62) | $ (1.10) | |||||
Diluted (in dollars per share) | $ (0.62) | $ (1.10) | |||||
Weighted average common shares: | |||||||
Basic (in shares) | 32,698,295 | 31,150,883 | |||||
Diluted (in shares) | 32,698,295 | 31,150,883 | |||||
As Reported | Error In Calculation Of Basic And Diluted Weighted Average Common Shares Outstanding | |||||||
Net loss per share: | |||||||
Basic (in dollars per share) | $ (0.57) | $ (1.05) | |||||
Diluted (in dollars per share) | $ (0.57) | $ (1.05) | |||||
Weighted average common shares: | |||||||
Basic (in shares) | 35,759,193 | 32,672,876 | |||||
Diluted (in shares) | 35,759,193 | 32,672,876 | |||||
Public Stock Offering | |||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||
Common shares issued (in shares) | 5,769,231 | 6,634,615 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) - USD ($) $ in Thousands | Sep. 25, 2020 | Dec. 27, 2019 |
Fair Value Disclosures [Abstract] | ||
Long-term earn-out liabilities | $ 2,815 | $ 7,957 |
Fair Value Measurements - Summa
Fair Value Measurements - Summary of Changes in Level 3 Contingent Consideration Liability (Details) $ in Thousands | 9 Months Ended |
Sep. 25, 2020USD ($) | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Balance at beginning of period | $ 14,698 |
Acquisition value | 3,464 |
Cash payments | (3,927) |
Changes in fair value | (11,219) |
Balance at end of period | 3,016 |
Fells Point | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Balance at beginning of period | 4,544 |
Acquisition value | 0 |
Cash payments | 0 |
Changes in fair value | (4,544) |
Balance at end of period | 0 |
Bassian | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Balance at beginning of period | 7,957 |
Acquisition value | 0 |
Cash payments | (2,250) |
Changes in fair value | (4,337) |
Balance at end of period | 1,370 |
Sid Wainer | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Balance at beginning of period | 0 |
Acquisition value | 2,081 |
Cash payments | 0 |
Changes in fair value | (1,581) |
Balance at end of period | 500 |
Other Acquisitions | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Balance at beginning of period | 2,197 |
Acquisition value | 1,383 |
Cash payments | (1,677) |
Changes in fair value | (757) |
Balance at end of period | $ 1,146 |
Fair Value Measurements - Sum_2
Fair Value Measurements - Summary of the Carrying Value and Fair Value of Convertible Subordinated Notes (Details) - Fair Value Inputs Level 3 - USD ($) $ in Thousands | Sep. 25, 2020 | Dec. 27, 2019 |
Senior Notes | Carrying Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Convertible Notes | $ 150,000 | $ 150,000 |
Senior Notes | Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Convertible Notes | 141,048 | 165,000 |
Unsecured Debt | Carrying Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Convertible Notes | 4,000 | 4,000 |
Unsecured Debt | Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Convertible Notes | $ 3,711 | $ 4,282 |
Acquisitions - Narrative (Detai
Acquisitions - Narrative (Details) - USD ($) $ in Thousands | Jan. 27, 2020 | Sep. 25, 2020 | Sep. 25, 2020 |
Cambridge Packing Co. | |||
Business Acquisition [Line Items] | |||
Payment made for asset acquisition | $ 16,356 | ||
Sid Wainer | |||
Business Acquisition [Line Items] | |||
Purchase price | $ 44,081 | ||
Cash amount paid | 46,450 | ||
Cash received | 2,369 | ||
Additional contingent consideration, amount | $ 4,000 | ||
Additional contingent consideration, term (in years) | 2 years | ||
Estimated fair value of contingent earn-out liability | $ 2,081 | $ 500 | 500 |
Net sales of acquiree since acquisition date | 27,831 | 66,451 | |
Operating earnings (loss) of acquiree since acquisition date | $ (1,177) | $ (5,646) | |
Professional fees | $ 435 |
Acquisitions - Pro Forma Consol
Acquisitions - Pro Forma Consolidated Income Statement Information (Details) - Sid Wainer - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 25, 2020 | Sep. 27, 2019 | Sep. 25, 2020 | Sep. 27, 2019 | |
Business Acquisition [Line Items] | ||||
Net sales | $ 254,030 | $ 461,034 | $ 842,735 | $ 1,331,487 |
(Loss) income before income taxes | $ (16,631) | $ 8,613 | $ (70,999) | $ 19,404 |
Acquisitions - Summary of Cash
Acquisitions - Summary of Cash Price for Acquisition (Details) - USD ($) $ in Thousands | Sep. 25, 2020 | Jan. 27, 2020 | Dec. 27, 2019 |
Business Acquisition [Line Items] | |||
Goodwill | $ 214,581 | $ 197,743 | |
Sid Wainer | |||
Business Acquisition [Line Items] | |||
Current assets | $ 22,960 | ||
Goodwill | 11,571 | ||
Fixed assets | 19,425 | ||
Right-of-use assets | 8,259 | ||
Lease liabilities | (8,259) | ||
Current liabilities | (11,294) | ||
Earn-out liability | (500) | (2,081) | |
Total consideration | 44,081 | ||
Sid Wainer | Customer relationships | |||
Business Acquisition [Line Items] | |||
Finite-lived intangible assets | 0 | ||
Sid Wainer | Trademarks | |||
Business Acquisition [Line Items] | |||
Finite-lived intangible assets | $ 3,500 | ||
Other Acquisitions | |||
Business Acquisition [Line Items] | |||
Current assets | 6,172 | ||
Goodwill | 5,291 | ||
Fixed assets | 308 | ||
Right-of-use assets | 1,019 | ||
Lease liabilities | (1,019) | ||
Current liabilities | (932) | ||
Earn-out liability | (1,383) | ||
Total consideration | 16,356 | ||
Other Acquisitions | Customer relationships | |||
Business Acquisition [Line Items] | |||
Finite-lived intangible assets | 6,200 | ||
Other Acquisitions | Trademarks | |||
Business Acquisition [Line Items] | |||
Finite-lived intangible assets | $ 700 |
Inventories - Narrative (Detail
Inventories - Narrative (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 25, 2020 | Dec. 27, 2019 | |
Inventory Disclosure [Abstract] | ||
Reserves for shrinkage, excess and obsolescence | $ 8,118 | $ 1,937 |
Incremental inventory obsolescence related to COVID-19 pandemic | $ 9,800 |
Equipment, Leasehold Improvem_3
Equipment, Leasehold Improvements and Software (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 25, 2020 | Dec. 27, 2019 | |
Property, Plant and Equipment [Line Items] | ||
Equipment, leasehold improvements and software, gross | $ 196,905 | $ 156,156 |
Less: accumulated depreciation and amortization | (79,941) | (63,310) |
Equipment, leasehold improvements and software, net | 116,964 | 92,846 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Equipment, leasehold improvements and software, gross | $ 5,020 | 1,170 |
Buildings | ||
Property, Plant and Equipment [Line Items] | ||
Useful Lives (in years) | 20 years | |
Equipment, leasehold improvements and software, gross | $ 15,685 | 1,360 |
Machinery and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Equipment, leasehold improvements and software, gross | $ 24,770 | 21,718 |
Machinery and equipment | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Useful Lives (in years) | 5 years | |
Machinery and equipment | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Useful Lives (in years) | 10 years | |
Computers, data processing and other equipment | ||
Property, Plant and Equipment [Line Items] | ||
Equipment, leasehold improvements and software, gross | $ 14,111 | 12,686 |
Computers, data processing and other equipment | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Useful Lives (in years) | 3 years | |
Computers, data processing and other equipment | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Useful Lives (in years) | 7 years | |
Software | ||
Property, Plant and Equipment [Line Items] | ||
Equipment, leasehold improvements and software, gross | $ 33,024 | 29,305 |
Software | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Useful Lives (in years) | 3 years | |
Software | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Useful Lives (in years) | 7 years | |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Equipment, leasehold improvements and software, gross | $ 71,531 | 70,903 |
Leasehold improvements | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Useful Lives (in years) | 1 year | |
Leasehold improvements | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Useful Lives (in years) | 40 years | |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Useful Lives (in years) | 7 years | |
Equipment, leasehold improvements and software, gross | $ 3,433 | 3,309 |
Vehicles | ||
Property, Plant and Equipment [Line Items] | ||
Equipment, leasehold improvements and software, gross | $ 20,103 | 6,410 |
Vehicles | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Useful Lives (in years) | 5 years | |
Vehicles | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Useful Lives (in years) | 7 years | |
Other | ||
Property, Plant and Equipment [Line Items] | ||
Useful Lives (in years) | 7 years | |
Equipment, leasehold improvements and software, gross | $ 96 | 95 |
Construction-in-process | ||
Property, Plant and Equipment [Line Items] | ||
Equipment, leasehold improvements and software, gross | $ 9,132 | $ 9,200 |
Equipment, Leasehold Improvem_4
Equipment, Leasehold Improvements and Software - Components of Depreciation and Amortization Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 25, 2020 | Sep. 27, 2019 | Sep. 25, 2020 | Sep. 27, 2019 | Dec. 27, 2019 | |
Property, Plant and Equipment [Line Items] | |||||
Equipment and vehicles financed by leases | $ 116,964 | $ 116,964 | $ 92,846 | ||
Depreciation expense, various assets | 5,039 | $ 3,484 | 14,714 | $ 9,539 | |
Assets held under finance leases | |||||
Property, Plant and Equipment [Line Items] | |||||
Equipment and vehicles financed by leases | 14,623 | 14,623 | $ 3,905 | ||
Excluding assets held under finance leases | |||||
Property, Plant and Equipment [Line Items] | |||||
Depreciation expense, various assets | 3,792 | 2,558 | 11,023 | 6,793 | |
Software | |||||
Property, Plant and Equipment [Line Items] | |||||
Depreciation expense, various assets | $ 1,247 | $ 926 | $ 3,691 | $ 2,746 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets - Narrative (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 25, 2020 | Sep. 27, 2019 | Sep. 25, 2020 | Sep. 27, 2019 | Mar. 27, 2020 | |
Finite-Lived Intangible Assets [Line Items] | |||||
Goodwill impairment | $ 0 | ||||
Amortization expense | $ 3,391,000 | $ 3,301,000 | $ 10,111,000 | $ 9,485,000 | |
Customer relationships | Minimum | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Useful life of intangible assets (in years) | 4 years | ||||
Customer relationships | Maximum | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Useful life of intangible assets (in years) | 20 years | ||||
Trademarks | Minimum | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Useful life of intangible assets (in years) | 1 year | ||||
Trademarks | Maximum | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Useful life of intangible assets (in years) | 40 years | ||||
Noncompete Agreements | Minimum | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Useful life of intangible assets (in years) | 2 years | ||||
Noncompete Agreements | Maximum | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Useful life of intangible assets (in years) | 6 years | ||||
East Coast | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Amount of fair value in excess of carrying amount | 400,000,000 | $ 400,000,000 | |||
Midwest | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Amount of fair value in excess of carrying amount | 19,000,000 | 19,000,000 | |||
West Coast | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Amount of fair value in excess of carrying amount | $ 14,000,000 | $ 14,000,000 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets - Goodwill (Details) $ in Thousands | 9 Months Ended |
Sep. 25, 2020USD ($) | |
Goodwill [Roll Forward] | |
Beginning balance | $ 197,743 |
Acquisitions | 16,862 |
Foreign currency translation | (24) |
Ending balance | $ 214,581 |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets - Intangible assets (Details) - USD ($) $ in Thousands | Sep. 25, 2020 | Dec. 27, 2019 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 218,663 | $ 208,310 |
Accumulated Amortization | (79,670) | (69,559) |
Net Amount | 138,993 | 138,751 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 141,399 | 135,226 |
Accumulated Amortization | (52,720) | (45,454) |
Net Amount | 88,679 | 89,772 |
Noncompete Agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 8,579 | 8,579 |
Accumulated Amortization | (7,677) | (7,479) |
Net Amount | 902 | 1,100 |
Trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 68,685 | 64,505 |
Accumulated Amortization | (19,273) | (16,626) |
Net Amount | $ 49,412 | $ 47,879 |
Goodwill and Other Intangible_6
Goodwill and Other Intangible Assets - Future amortization (Details) $ in Thousands | Sep. 25, 2020USD ($) |
Estimated amortization in fiscal year: | |
2020 | $ 3,395 |
2021 | 13,574 |
2022 | 12,794 |
2023 | 11,766 |
2024 | 11,423 |
Thereafter | 86,041 |
Total | $ 138,993 |
Debt Obligations - Schedule of
Debt Obligations - Schedule of Debt Obligations (Details) - USD ($) $ in Thousands | Sep. 25, 2020 | Dec. 27, 2019 |
Debt Instrument [Line Items] | ||
Finance lease and other financing obligations | $ 14,834 | $ 3,905 |
Deferred finance fees and original issue discount | (8,275) | (9,207) |
Total debt obligations | 402,540 | 386,827 |
Less: current installments | (5,904) | (721) |
Total debt obligations excluding current installments | 396,636 | 386,106 |
Senior secured term loans | ||
Debt Instrument [Line Items] | ||
Long-term debt | 201,981 | 238,129 |
Convertible senior notes | ||
Debt Instrument [Line Items] | ||
Long-term debt | 150,000 | 150,000 |
Asset-based loan facility | ||
Debt Instrument [Line Items] | ||
Long-term debt | 40,000 | 0 |
Convertible unsecured note | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 4,000 | $ 4,000 |
Debt Obligations - Narrative (D
Debt Obligations - Narrative (Details) - USD ($) | Jun. 08, 2020 | Sep. 25, 2020 |
2025 Tranche | Credit facility | ||
Debt Instrument [Line Items] | ||
Term loans | $ 238,129,000 | |
Term loans, maturity date extension (in years) | 3 years | |
Prepayment | $ 35,719,000 | |
2025 Tranche | Credit facility | Base Rate | ||
Debt Instrument [Line Items] | ||
Basis points | 2.00% | |
1.875% Convertible Senior Notes | Convertible senior notes | ||
Debt Instrument [Line Items] | ||
Interest rate | 1.875% | |
Senior secured term loan | Credit facility | ||
Debt Instrument [Line Items] | ||
Debt issuance costs | $ 856,000 | |
Debt transaction cost | $ 1,233,000 | |
Minimum liquidity covenant | $ 35,000,000 | |
EBITDA covenant | 10,000,000 | |
Minimum liquidity amount | $ 250,392,000 | |
Effective interest rate | 5.30% | |
ABL Facility | Credit facility | ||
Debt Instrument [Line Items] | ||
Amounts reserved for issuance of letters of credit | $ 20,141,000 | |
Line of credit facility, current borrowing capacity | $ 44,275,000 | |
Effective interest rate | 1.90% |
Debt Obligations - Schedule o_2
Debt Obligations - Schedule of Term Loans (Details) - Senior secured term loans - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 25, 2020 | Dec. 27, 2019 | |
Debt Instrument [Line Items] | ||
Term Loans, Principle Outstanding | $ 201,981 | $ 238,129 |
2022 Tranche | ||
Debt Instrument [Line Items] | ||
Term Loans, Principle Outstanding | $ 31,166 | |
2022 Tranche | LIBOR | ||
Debt Instrument [Line Items] | ||
Term Loans, Interest Rate (as a percent) | 3.50% | |
2025 Tranche | ||
Debt Instrument [Line Items] | ||
Term Loans, Principle Outstanding | $ 170,815 | |
Term Loans, Scheduled Principle Payments (as a percent) | 0.25% | |
2025 Tranche | LIBOR | ||
Debt Instrument [Line Items] | ||
Term Loans, Interest Rate (as a percent) | 5.50% |
Stockholders' Equity - Narrativ
Stockholders' Equity - Narrative (Details) - USD ($) | Jun. 02, 2020 | May 14, 2020 | Sep. 25, 2020 | Jun. 26, 2020 | Sep. 27, 2019 | Sep. 25, 2020 | Sep. 27, 2019 | Mar. 22, 2020 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Share-based compensation expense, capitalized | $ 0 | |||||||
Number of shares available for grant (in shares) | 1,254,514 | 1,254,514 | ||||||
Public Stock Offering | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Shares sold in offering (in shares) | 5,769,231 | 6,634,615 | ||||||
Offering price per share ($ per share) | $ 13 | |||||||
Aggregate net proceeds from stock offering | $ 74,691,000 | |||||||
Over-Allotment Option | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Shares sold in offering (in shares) | 865,384 | |||||||
Offering price per share ($ per share) | $ 13 | |||||||
Aggregate net proceeds from stock offering | $ 11,250,000 | |||||||
Restricted Stock | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Shares granted (in shares) | 1,003,671 | |||||||
Weighted average grant date fair value (in usd per share) | $ 17.51 | |||||||
Recognized expense | $ 2,075,000 | $ 908,000 | $ 4,925,000 | $ 2,797,000 | ||||
Total unrecognized compensation cost, RSAs | 13,275,000 | $ 13,275,000 | ||||||
Weighted average remaining term (in years) | 2 years | |||||||
Time and Performance Based Grants | Maximum | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Vesting period (in years) | 4 years | |||||||
Time-Based Restricted Awards | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Total unrecognized compensation cost, RSAs | 11,048,000 | $ 11,048,000 | ||||||
Weighted average remaining term (in years) | 2 years | |||||||
Performance-Based Restricted Awards | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Total unrecognized compensation cost, RSAs | $ 2,227,000 | $ 2,227,000 | ||||||
Weighted average remaining term (in years) | 2 years 2 months 12 days | |||||||
Stock options | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Recognized expense | $ 0 | $ 114,000 | ||||||
Series A Preferred Stock | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of shares that can be purchased by each Right (in shares) | 0.001 | |||||||
Exercise price of right (in dollars per share) | $ 40 |
Stockholders' Equity - Schedule
Stockholders' Equity - Schedule of Restricted Stock Awards (Details) - Restricted Stock | 9 Months Ended |
Sep. 25, 2020$ / sharesshares | |
Shares | |
Unvested at beginning balance (in shares) | shares | 740,609 |
Granted (in shares) | shares | 1,003,671 |
Vested (in shares) | shares | (215,367) |
Forfeited (in shares) | shares | (42,678) |
Unvested at ending balance (in shares) | shares | 1,486,235 |
Weighted Average Grant Date Fair Value | |
Unvested at beginning balance (in usd per shares) | $ / shares | $ 27.68 |
Granted (in usd per share) | $ / shares | 17.51 |
Vested (in usd per share) | $ / shares | 24.22 |
Forfeited (in usd per share) | $ / shares | 24.45 |
Unvested at ending balance (in usd per shares) | $ / shares | $ 21.49 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 25, 2020 | Sep. 27, 2019 | |
Income Tax Disclosure [Abstract] | ||
Effective income tax rate (as a percent) | 34.50% | 27.50% |
CARES Act, Income tax refund receivable | $ 20,973 |
Related Parties - Narrative (De
Related Parties - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 25, 2020 | Sep. 27, 2019 | Sep. 25, 2020 | Sep. 27, 2019 | |
Related Party Transactions [Abstract] | ||||
Ownership interest in facilities owned by entities controlled by company's stockholders | 100.00% | |||
Expenses related to transactions with related parties | $ 124 | $ 108 | $ 365 | $ 325 |
Supplemental Disclosures of C_3
Supplemental Disclosures of Cash Flow Information - Summary of Supplemental Cash Flow Disclosures (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 25, 2020 | Sep. 27, 2019 | |
Supplemental cash flow disclosures: | ||
Cash paid for income taxes, net of cash received | $ 308 | $ 6,045 |
Cash paid for interest, net of cash received | 12,741 | 12,477 |
Cash paid for amounts included in the measurement of lease liabilities: | ||
Operating cash flows from operating leases | 20,206 | 18,575 |
Operating cash flows from finance leases | 411 | 65 |
ROU assets obtained in exchange for lease liabilities: | ||
Operating leases | 5,800 | 154,330 |
Finance leases | 14,017 | 1,820 |
Other non-cash investing and financing activities: | ||
Convertible notes issued for acquisitions | 0 | 4,000 |
Contingent earn-out liabilities for acquisitions | $ 3,464 | $ 7,929 |