Exhibit 99.1
| | |
 | | 12500 West Creek Parkway
Richmond, VA 23238
Phone (804) 484-7700
FAX (804) 484-7701 |
| | |
| FOR MORE INFORMATION: | | |
| | | |
| Media Contact: | | Investor Contact: |
Cheryl Moore
Director, Corporate Communications
(804) 484-6273 | | Kevin Collier
Director, Investor Relations
(804) 287-8109 |
PERFORMANCE FOOD GROUP REPORTS NET EPS OF $0.35
IN THIRD QUARTER FROM CONTINUING OPERATIONS
| | • | | Net EPS from continuing operations increased 25% over prior year quarter to $0.35 per share diluted |
| |
| | • | | Street sales increased 9% over prior year quarter |
RICHMOND, VA. (Nov. 7, 2006)— Performance Food Group (Nasdaq/NGS:PFGC) today announced results for the third quarter ended September 30, 2006.
“We are pleased with our results in the third quarter in view of moderate industry growth,” said Steve Spinner, president and chief executive officer. “Our third quarter results reflect solid performance in the growth of higher margin street sales, as we continue to make an investment in the expansion of the sales force. Sales results in the quarter also reflect our previously announced exit of certain lower margin multi-unit business in the broadline segment. Our customized segment continued to increase sales through account penetration and growth with existing customers. We are maintaining our focus on driving standardized business practices throughout our companies as we implement our operational excellence and category management initiatives.”
Third Quarter Financial Highlights:
| | • | | Consolidated net sales from continuing operations in the third quarter were approximately $1.4 billion, an increase of approximately 2%, compared to the prior year quarter. Inflation was approximately 1.5% for the quarter. |
| |
| | • | | Net earnings from continuing operations in the third quarter increased to approximately $12.2 million, an increase of approximately 2%, compared to approximately $11.9 million in the same quarter in the previous year. Net earnings include the impact of pre-tax stock compensation expense of approximately $1.3 million, or $828,000 after tax for the quarter, compared to pre-tax stock compensation expense of approximately $355,000, or $220,000 after tax, in the prior year quarter. The Company’s results in the third quarter of 2005 were negatively impacted by the effects of Hurricane Katrina, offset by |
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Performance Food Group Reports Third Quarter Earnings
Page 2
November 7, 2006
| | | | incremental interest income related to earnings on cash proceeds from the sale of the fresh-cut segment. |
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| | • | | Adjusted for the impact of stock compensation expense, net earnings from continuing operations in the third quarter amounted to approximately $13.0 million, an increase of approximately 7% versus the prior year quarter. |
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| | • | | Net earnings per share from continuing operations in the third quarter increased approximately 25% to $0.35 per share diluted, compared to $0.28 per share diluted in the prior year quarter, on approximately 19% fewer shares outstanding. Excluding stock compensation expense in the 2006 quarter, net earnings per share were approximately $0.38 per share diluted. |
Year to Date Financial Highlights:
| | • | | Consolidated net sales from continuing operations for the first nine months of 2006 were approximately $4.3 billion, an increase of approximately 2% from the prior year period. Inflation was approximately 1% for the same period. |
| |
| | • | | Net earnings from continuing operations for the first nine months increased approximately 4% to approximately $30.0 million compared to approximately $28.8 million in the prior year period. Net earnings for the period include the impact of pre-tax stock compensation expense of approximately $3.6 million or $2.3 million after tax, compared to prior year pre-tax stock compensation expense of approximately $669,000 or $414,000 after tax. |
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| | • | | Adjusted for the impact of stock compensation expense, net earnings from continuing operations for the first nine months amounted to approximately $32.3 million, an increase of approximately 10% versus the prior year period. |
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| | • | | Net earnings per share from continuing operations for the first nine months increased approximately 37% to $0.86 per share diluted, compared to $0.63 per share diluted in the year earlier period, on approximately 24% fewer shares outstanding. Excluding stock compensation expense, net earnings per share in the 2006 period were approximately $0.93 per share diluted. |
“Sales in our customized segment during the third quarter increased by approximately 4% compared to the same quarter last year,” added Mr. Spinner. “Our sales gains during the third quarter were driven by growth with existing customers. We continue to leverage our new capacity in the customized segment to more efficiently serve our existing customers. We are also working aggressively to develop new customers and remain optimistic in our ability to attract new business.”
“In the broadline segment, our expanded street sales force, combined with our account penetration initiatives with existing customers, contributed to 9% growth in higher margin street business versus the prior year quarter. Overall sales in broadline increased by approximately 1% in the third quarter compared to the same quarter last year, reflecting the impact of our previously announced exit of certain lower margin multi-unit business and current industry trends. Broadline segment results were impacted by our investment in the expansion of our sales force, our continued investment in information technology and by higher fuel costs, partially offset by favorable trends in insurance costs
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Performance Food Group Reports Third Quarter Earnings
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November 7, 2006
during the quarter. Our new sales force is contributing to our growing mix of higher margin street sales and we anticipate continued productivity in our sales efforts throughout the year. We are also very focused on expense control both in broadline and throughout the company. ”
Mr. Spinner concluded, “We maintained a very strong balance sheet with a debt to capital ratio of less than 2% at the end of the third quarter, excluding $130 million of interests in accounts receivable sold under an accounts receivable purchase facility. Free cash flow was approximately $11.8 million during the third quarter, compared to free cash flow of $745,000 in the prior year quarter. Based on the current economic environment and our current business trends, we expect net earnings per share for the fourth quarter of this year to be in the range of $0.32 to $0.38 per share diluted. As a result, we expect net earnings per share to be in the range of $1.18 to $1.24 per share diluted for the full year of 2006, which reflects anticipated stock compensation expense for the year of approximately $5.0 million, or approximately $0.09 per share diluted. Excluding the impact of stock compensation expense, our anticipated net earnings per share for the year is approximately $1.27 to $1.33 per share diluted. In the near term, we will continue to invest in our core strategies and are confident in our ability to drive long term earnings growth for our shareholders.”
On June 28, 2005, the Company completed the sale of its fresh-cut segment to Chiquita Brands International, Inc. All amounts pertaining to the Company’s fresh-cut segment are accounted for as discontinued operations.
Performance Food Group markets and distributes more than 66,000 national and private label food and food-related products to approximately 44,000 restaurants, hotels, cafeterias, schools, healthcare facilities and other institutions. For more information on Performance Food Group, visitwww.pfgc.com.
Certain statements made herein are forward-looking statements under the Private Securities Litigation Reform Act of 1995. These statements involve risks and uncertainties and are based on current expectations and management’s estimates; actual results may differ materially. The risks and uncertainties which could impact these statements include, but are not limited to, general economic conditions, including consumer spending trends; the Company’s ability to achieve projected operational efficiencies and increase sales, particularly higher margin street sales; the relatively low margins and economic sensitivity of the foodservice business; the Company’s reliance on major customers; the ability to identify and successfully complete acquisitions of other foodservice distributors; the Company’s ability to successfully develop, produce and market new products and management of the Company’s planned growth, all as detailed from time to time in the reports filed by the Company with the Securities and Exchange Commission.
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Performance Food Group Reports Third Quarter Earnings
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November 7, 2006
Performance Food Group Company
Unaudited Financial Highlights
| | | | | | | | | |
| (In thousands, except net earnings per common share) | | Three Months Ended |
| | |
Sept. 30, 2006 | |
Oct. 1, 2005 |
| Net sales from continuing operations | | $ | 1,429,765 | | | $ | 1,401,780 | |
| | | | | | | | | |
| Earnings from continuing operations, net of tax | | $ | 12,175 | | | $ | 11,911 | |
| Loss from discontinued operations, net of tax | | | — | | | | (1,104 | ) |
| (Loss) gain on sale of fresh-cut segment, net of tax | | | (132 | ) | | | 640 | |
| | | | | | | | | |
| Net earnings | | $ | 12,043 | | | $ | 11,447 | |
| | | | | | | | | |
| Weighted average number of shares outstanding: | | | | | | | | |
| Basic | | | 34,369 | | | | 42,316 | |
| Diluted | | | 34,624 | | | | 42,906 | |
| | | | | | | | | |
| Earnings (loss) per common share: | | | | | | | | |
| Basic earnings per common share-continuing operations | | $ | 0.35 | | | $ | 0.28 | |
| Basic loss per common share-discontinued operations | | | — | | | | (0.03 | ) |
| Gain on sale of fresh-cut segment | | | — | | | | 0.02 | |
| | | | | | | | | |
| Net earnings | | $ | 0.35 | | | $ | 0.27 | |
| | | | | | | | | |
| Diluted earnings per common share-continuing operations | | $ | 0.35 | | | $ | 0.28 | |
| Diluted loss per common share-discontinued operations | | | — | | | | (0.03 | ) |
| Gain on sale of fresh-cut segment | | | — | | | | 0.02 | |
| | | | | | | | | |
| Net earnings | | $ | 0.35 | | | $ | 0.27 | |
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Performance Food Group Reports Third Quarter Earnings
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November 7, 2006
Performance Food Group Company
Unaudited Financial Highlights
| | | | | | | | | |
| (In thousands, except net earnings per common share) | | Nine Months Ended |
| | |
Sept. 30, 2006 | |
Oct. 1, 2005 |
| Net sales from continuing operations | | $ | 4,347,285 | | | $ | 4,281,322 | |
| | | | | | | | | |
| Earnings from continuing operations, net of tax | | $ | 30,017 | | | $ | 28,840 | |
| Earnings from discontinued operations, net of tax | | | — | | | | 18,499 | |
| (Loss) gain on sale of fresh-cut segment, net of tax | | | (150 | ) | | | 181,598 | |
| | | | | | | | | |
| Net earnings | | $ | 29,867 | | | $ | 228,937 | |
| | | | | | | | | |
| Weighted average number of shares outstanding: | | | | | | | | |
| Basic | | | 34,322 | | | | 45,381 | |
| Diluted | | | 34,780 | | | | 45,972 | |
| | | | | | | | | |
| Earnings per common share: | | | | | | | | |
| Basic earnings per common share-continuing operations | | $ | 0.87 | | | $ | 0.64 | |
| Basic earnings per common share-discontinued operations | | | — | | | | 0.41 | |
| Gain on sale of fresh-cut segment | | | — | | | | 4.00 | |
| | | | | | | | | |
| Net earnings | | $ | 0.87 | | | $ | 5.05 | |
| | | | | | | | | |
| Diluted earnings per common share-continuing operations | | $ | 0.86 | | | $ | 0.63 | |
| Diluted earnings per common share-discontinued operations | | | — | | | | 0.40 | |
| Gain on sale of fresh-cut segment | | | — | | | | 3.95 | |
| | | | | | | | | |
| Net earnings | | $ | 0.86 | | | $ | 4.98 | |
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Performance Food Group Reports Third Quarter Earnings
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November 7, 2006
Performance Food Group Company
Condensed Consolidated Balance Sheet (Unaudited)
September 30, 2006
(In thousands)
| | | | | | | | | |
| | | Sept. 30, 2006 | | Dec. 31, 2005 |
| | | |
Assets | | | | | | | | |
| Cash and cash equivalents | | $ | 76,028 | | | $ | 99,461 | |
| Accounts and notes receivable, net, including retained interest in securitized receivables | | | 197,384 | | | | 190,481 | |
| Inventories | | | 309,638 | | | | 303,073 | |
| Other current assets | | | 33,019 | | | | 29,188 | |
| Current assets from discontinued operations | | | 3,108 | | | | 10,115 | |
| |
| Total current assets | | | 619,177 | | | | 632,318 | |
| |
| Property, plant and equipment, net | | | 279,655 | | | | 255,816 | |
| Goodwill, net | | | 356,509 | | | | 356,597 | |
| Other intangible assets, net | | | 48,446 | | | | 51,213 | |
| Other assets | | | 17,721 | | | | 16,346 | |
| |
| Total assets | | $ | 1,321,508 | | | $ | 1,312,290 | |
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| | | | | | | | | |
Liabilities and Shareholders’ Equity | | | | | | | | |
| Checks in excess of deposits | | $ | 90,441 | | | $ | 100,335 | |
| Trade accounts payable | | | 260,861 | | | | 258,791 | |
| Current installments of long-term debt | | | 582 | | | | 573 | |
| Other current liabilities | | | 124,627 | | | | 122,885 | |
| Current liabilities from discontinued operations | | | 6,022 | | | | 6,540 | |
| |
| Total current liabilities | | | 482,533 | | | | 489,124 | |
| |
| Long-term debt, excluding current installments | | | 11,814 | | | | 3,250 | |
| Deferred income taxes | | | 47,700 | | | | 43,399 | |
| Shareholders’ equity | | | 779,461 | | | | 776,517 | |
| |
| Total liabilities and shareholders’ equity | | $ | 1,321,508 | | | $ | 1,312,290 | |
| |
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Performance Food Group Reports Third Quarter Earnings
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November 7, 2006
Performance Food Group Company
Condensed Consolidated Income Statement (Unaudited)
September 30, 2006
(In thousands, except net earnings per common share)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Three Months Ended | | | | | | Nine Months Ended |
| | | Sept. 30, 2006 | | Oct. 1, 2005 | | | | | | Sept. 30, 2006 | | Oct. 1, 2005 |
| | | | | | | |
| Net sales | | $ | 1,429,765 | | | | 100.0 | % | | $ | 1,401,780 | | | | 100.0 | % | | | | | | $ | 4,347,285 | | | | 100.0 | % | | $ | 4,281,322 | | | | 100.0 | % |
| Cost of goods sold | | | 1,235,412 | | | | 86.4 | % | | | 1,215,912 | | | | 86.7 | % | | | | | | | 3,772,475 | | | | 86.8 | % | | | 3,726,146 | | | | 87.0 | % |
| | | | | | | |
| Gross profit | | | 194,353 | | | | 13.6 | % | | | 185,868 | | | | 13.3 | % | | | | | | | 574,810 | | | | 13.2 | % | | | 555,176 | | | | 13.0 | % |
| Operating expenses | | | 174,242 | | | | 12.2 | % | | | 168,245 | | | | 12.0 | % | | | | | | | 522,447 | | | | 12.0 | % | | | 506,176 | | | | 11.9 | % |
| | | | | | | |
| Operating profit | | | 20,111 | | | | 1.4 | % | | | 17,623 | | | | 1.3 | % | | | | | | | 52,363 | | | | 1.2 | % | | | 49,000 | | | | 1.1 | % |
| | | | | | | |
| Other (expense) income: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Interest income | | | 818 | | | | | | | | 3,218 | | | | | | | | | | | | 1,680 | | | | | | | | 3,720 | | | | | |
| Interest expense | | | (394 | ) | | | | | | | (324 | ) | | | | | | | | | | | (1,118 | ) | | | | | | | (2,837 | ) | | | | |
| Loss on sale of receivables | | | (1,903 | ) | | | | | | | (1,339 | ) | | | | | | | | | | | (5,402 | ) | | | | | | | (3,580 | ) | | | | |
| Other, net | | | 121 | | | | | | | | 28 | | | | | | | | | | | | 274 | | | | | | | | 331 | | | | | |
| | | | | | | |
| Other (expense) income, net | | | (1,358 | ) | | | -0.1 | % | | | 1,583 | | | | 0.1 | % | | | | | | | (4,566 | ) | | | -0.1 | % | | | (2,366 | ) | | | 0.0 | % |
| | | | | | | |
| Earnings before income taxes from continuing operations | | | 18,753 | | | | 1.3 | % | | | 19,206 | | | | 1.4 | % | | | | | | | 47,797 | | | | 1.1 | % | | | 46,634 | | | | 1.1 | % |
| Income taxes | | | 6,578 | | | | 0.4 | % | | | 7,295 | | | | 0.6 | % | | | | | | | 17,780 | | | | 0.4 | % | | | 17,794 | | | | 0.4 | % |
| |
| Earnings from continuing operations, net of tax | | $ | 12,175 | | | | 0.9 | % | | $ | 11,911 | | | | 0.8 | % | | | | | | $ | 30,017 | | | | 0.7 | % | | $ | 28,840 | | | | 0.7 | % |
| |
| (Loss) earnings from discontinued operations, net of tax | | | — | | | | | | | | (1,104 | ) | | | | | | | | | | | — | | | | | | | | 18,499 | | | | | |
| (Loss) gain on sale of fresh-cut segment, net of tax | | | (132 | ) | | | | | | | 640 | | | | | | | | | | | | (150 | ) | | | | | | | 181,598 | | | | | |
| | | | | | | |
| Total (loss) earnings from discontinued operations, net of tax | | | (132 | ) | | | | | | | (464 | ) | | | | | | | | | | | (150 | ) | | | | | | | 200,097 | | | | | |
| | | | | | | |
| Net earnings | | $ | 12,043 | | | | | | | $ | 11,447 | | | | | | | | | | | $ | 29,867 | | | | | | | $ | 228,937 | | | | | |
| | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Weighted average common shares outstanding: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Basic | | | 34,369 | | | | | | | | 42,316 | | | | | | | | | | | | 34,322 | | | | | | | | 45,381 | | | | | |
| Diluted | | | 34,624 | | | | | | | | 42,906 | | | | | | | | | | | | 34,780 | | | | | | | | 45,972 | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Earnings (loss) per common share: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Basic net earnings (loss) per common share: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Continuing operations | | $ | 0.35 | | | | | | | $ | 0.28 | | | | | | | | | | | $ | 0.87 | | | | | | | $ | 0.64 | | | | | |
| | | | | | | |
| Discontinued operations | | | — | | | | | | | | (0.03 | ) | | | | | | | | | | | — | | | | | | | | 0.41 | | | | | |
| Gain on sale of fresh-cut segment | | | — | | | | | | | | 0.02 | | | | | | | | | | | | — | | | | | | | | 4.00 | | | | | |
| | | | | | | |
| Total (loss) earnings from discontinued operations | | | — | | | | | | | | (0.01 | ) | | | | | | | | | | | — | | | | | | | | 4.41 | | | | | |
| | | | | | | |
| Net earnings | | $ | 0.35 | | | | | | | $ | 0.27 | | | | | | | | | | | $ | 0.87 | | | | | | | $ | 5.05 | | | | | |
| | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Diluted net earnings (loss) per common share: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Continuing operations | | $ | 0.35 | | | | | | | $ | 0.28 | | | | | | | | | | | $ | 0.86 | | | | | | | $ | 0.63 | | | | | |
| | | | | | | |
| Discontinued operations | | | — | | | | | | | | (0.03 | ) | | | | | | | | | | | — | | | | | | | | 0.40 | | | | | |
| Gain on sale of fresh-cut segment | | | — | | | | | | | | 0.02 | | | | | | | | | | | | — | | | | | | | | 3.95 | | | | | |
| | | | | | | |
| Total (loss) earnings from discontinued operations | | | — | | | | | | | | (0.01 | ) | | | | | | | | | | | — | | | | | | | | 4.35 | | | | | |
| | | | | | | |
| Net earnings | | $ | 0.35 | | | | | | | $ | 0.27 | | | | | | | | | | | $ | 0.86 | | | | | | | $ | 4.98 | | | | | |
| | | | | | | |
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Performance Food Group Reports Third Quarter Earnings
Page 8
November 7, 2006
Performance Food Group Company
2006 Compared to 2005
Third Quarter
Segment Disclosure
| | | | | | | | | | | | | | | | | |
| | | | | | | | | | | Corporate & | | Total Continuing |
| 2006 | | Broadline | | Customized | | Intersegment | | Operations |
| |
Third Quarter | | | | | | | | | | | | | | | | |
| Net external sales | | $ | 864,516 | | | $ | 565,249 | | | $ | — | | | $ | 1,429,765 | |
| Intersegment sales | | | 129 | | | | 47 | | | | (176 | ) | | | — | |
Total sales | | | 864,645 | | | | 565,296 | | | | (176 | ) | | | 1,429,765 | |
| Operating profit | | | 18,558 | | | | 7,125 | | | | (5,572 | ) | | | 20,111 | |
Operating profit margin | | | 2.15 | % | | | 1.26 | % | | | — | | | | 1.41 | % |
| Interest expense (income) | | | 5,942 | | | | 1,496 | | | | (7,044 | ) | | | 394 | |
| Loss (gain) on sale of receivables | | | 2,977 | | | | 745 | | | | (1,819 | ) | | | 1,903 | |
| Depreciation | | | 4,818 | | | | 1,580 | | | | 68 | | | | 6,466 | |
| Amortization | | | 817 | | | | — | | | | — | | | | 817 | |
| Capital expenditures | | | 7,955 | | | | 1,023 | | | | 20 | | | | 8,998 | |
| | | | | | | | | | | | | | | | | |
| | | | | | | | | | | Corporate & | | Total Continuing |
| 2005 | | Broadline | | Customized | | Intersegment | | Operations |
| |
Third Quarter | | | | | | | | | | | | | | | | |
| Net external sales | | $ | 856,383 | | | $ | 545,397 | | | $ | — | | | $ | 1,401,780 | |
| Intersegment sales | | | 180 | | | | 44 | | | | (224 | ) | | | — | |
Total sales | | | 856,563 | | | | 545,441 | | | | (224 | ) | | | 1,401,780 | |
| Operating profit | | | 16,982 | | | | 6,484 | | | | (5,843 | ) | | | 17,623 | |
Operating profit margin | | | 1.98 | % | | | 1.19 | % | | | — | | | | 1.26 | % |
| Interest expense (income) | | | 4,309 | | | | 957 | | | | (4,942 | ) | | | 324 | |
| Loss (gain) on sale of receivables | | | 2,405 | | | | 675 | | | | (1,741 | ) | | | 1,339 | |
| Depreciation | | | 4,316 | | | | 1,308 | | | | 76 | | | | 5,700 | |
| Amortization | | | 882 | | | | — | | | | — | | | | 882 | |
| Capital expenditures | | | 4,903 | | | | 13,420 | | | | 3 | | | | 18,326 | |
Total assets by reportable segment and a reconciliation to the condensed consolidated balance sheets were as follows:
| | | | | | | | | |
| | | Sept. 30, 2006 | | Dec. 31, 2005 |
| |
Broadline | | $ | 894,030 | | | $ | 858,211 | |
Customized | | | 233,032 | | | | 250,397 | |
Corporate & Intersegment | | | 191,338 | | | | 193,567 | |
Discontinued Operations | | | 3,108 | | | | 10,115 | |
| |
Total Assets | | $ | 1,321,508 | | | $ | 1,312,290 | |
| |
Note: 2005 segment disclosure has been reclassified to reflect the reallocation of certain corporate costs to the broadline segment to be consistent with the 2006 presentation.
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Performance Food Group Reports Third Quarter Earnings
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November 7, 2006
Performance Food Group Company
2006 Compared to 2005
Nine Months YTD
Segment Disclosure
| | | | | | | | | | | | | | | | | |
| | | | | | | | | | | Corporate & | | Total Continuing |
| 2006 | | Broadline | | Customized | | Intersegment | | Operations |
| |
Nine Months YTD | | | | | | | | | | | | | | | | |
| Net external sales | | $ | 2,596,465 | | | $ | 1,750,820 | | | $ | — | | | $ | 4,347,285 | |
| Intersegment sales | | | 398 | | | | 167 | | | | (565 | ) | | | — | |
Total sales | | | 2,596,863 | | | | 1,750,987 | | | | (565 | ) | | | 4,347,285 | |
| Operating profit | | | 49,884 | | | | 22,889 | | | | (20,410 | ) | | | 52,363 | |
Operating profit margin | | | 1.92 | % | | | 1.31 | % | | | — | | | | 1.20 | % |
| Interest expense (income) | | | 16,843 | | | | 4,455 | | | | (20,180 | ) | | | 1,118 | |
| Loss (gain) on sale of receivables | | | 7,988 | | | | 2,304 | | | | (4,890 | ) | | | 5,402 | |
| Depreciation | | | 13,840 | | | | 4,709 | | | | 227 | | | | 18,776 | |
| Amortization | | | 2,523 | | | | — | | | | — | | | | 2,523 | |
| Capital expenditures | | | 30,610 | | | | 3,656 | | | | 233 | | | | 34,499 | |
| | | | | | | | | | | | | | | | | |
| | | | | | | | | | | Corporate & | | Total Continuing |
| 2005 | | Broadline | | Customized | | Intersegment | | Operations |
| |
Nine Months YTD | | | | | | | | | | | | | | | | |
| Net external sales | | $ | 2,612,280 | | | $ | 1,669,042 | | | $ | — | | | $ | 4,281,322 | |
| Intersegment sales | | | 483 | | | | 160 | | | | (643 | ) | | | — | |
Total sales | | | 2,612,763 | | | | 1,669,202 | | | | (643 | ) | | | 4,281,322 | |
| Operating profit | | | 50,862 | | | | 18,346 | | | | (20,208 | ) | | | 49,000 | |
Operating profit margin | | | 1.95 | % | | | 1.10 | % | | | — | | | | 1.14 | % |
| Interest expense (income) | | | 12,172 | | | | 1,601 | | | | (10,936 | ) | | | 2,837 | |
| Loss (gain) on sale of receivables | | | 7,450 | | | | 2,176 | | | | (6,046 | ) | | | 3,580 | |
| Depreciation | | | 12,957 | | | | 3,740 | | | | 226 | | | | 16,923 | |
| Amortization | | | 2,693 | | | | — | | | | — | | | | 2,693 | |
| Capital expenditures | | | 14,139 | | | | 42,437 | | | | 109 | | | | 56,685 | |
Total assets by reportable segment and a reconciliation to the condensed consolidated balance sheets were as follows:
| | | | | | | | | |
| | | Sept. 30, 2006 | | Dec. 31, 2005 |
| |
Broadline | | $ | 894,030 | | | $ | 858,211 | |
Customized | | | 233,032 | | | | 250,397 | |
Corporate & Intersegment | | | 191,338 | | | | 193,567 | |
Discontinued Operations | | | 3,108 | | | | 10,115 | |
| |
Total Assets | | $ | 1,321,508 | | | $ | 1,312,290 | |
| |
| | |
| Note: | | 2005 segment disclosure has been reclassified to reflect the reallocation of certain corporate costs to the broadline segment to be consistent with the 2006 presentation. |
- MORE -
Performance Food Group Reports Third Quarter Earnings
Page 10
November 7, 2006
Performance Food Group Company
Non-GAAP Reconciliations
Projected 2006 EPS Reconciliation Excluding Impact of Stock Compensation Expense
| | | | | | | | | |
| | | Estimated Diluted EPS |
| | | Low | | High |
| | | |
| Estimated full year 2006 diluted EPS | | $ | 1.18 | | | $ | 1.24 | |
Add: Projected stock compensation expense(1) | | $ | 0.09 | | | $ | 0.09 | |
| | | |
| Adjusted estimated full year 2006 diluted EPS to exclude stock compensation expense | | $ | 1.27 | | | $ | 1.33 | |
| | | |
| | |
| (1) | | Amount calculated using estimated pre-tax expense of $5.0 million, a projected tax rate of 38.0% and a projected weighted average shares of approximately 35.0 million. |
Impact of Stock Compensation on Diluted EPS
| | | | | | | | | | | | | |
| Three Months Ended September 30, 2006 | | Net Earnings | | Shares | | EPS |
| | | |
| Amounts reported for diluted EPS from continuing operations | | $ | 12,175 | | | | 34,624 | | | $ | 0.35 | |
Stock compensation, net of tax(2) | | | 828 | | | | | | | | | |
| | | |
| Adjusted diluted EPS from continuing operations excluding impact of stock compensation | | $ | 13,003 | | | | 34,624 | | | $ | 0.38 | |
| | | |
| | |
| (2) | | Amount calculated using continuing operations effective tax rate of 35.1%. |
| | | | | | | | | | | | | |
| Nine Months Ended September 30, 2006 | | Net Earnings | | Shares | | EPS |
| | | |
| Amounts reported for diluted EPS from continuing operations | | $ | 30,017 | | | | 34,780 | | | $ | 0.86 | |
Stock compensation, net of tax(3) | | | 2,263 | | | | | | | | | |
| | | |
| Adjusted diluted EPS from continuing operations excluding impact of stock compensation | | $ | 32,280 | | | | 34,780 | | | $ | 0.93 | |
| | | |
| | |
| (3) | | Amount calculated using continuing operations effective tax rate of 37.2%. |
- MORE -
Performance Food Group Reports Third Quarter Earnings
Page 11
November 7, 2006
Performance Food Group Company
Non-GAAP Reconciliations
Free Cash Flow
| | | | | | | | | |
| Quarterly | | Q3 2006 | | Q3 2005 |
| Net income from continuing operations | | $ | 12,175 | | | $ | 11,911 | |
Add back: | | | | | | | | |
| Stock compensation expense | | | 1,276 | | | | 355 | |
| Amortization expense | | | 817 | | | | 882 | |
| Amortization of deferred issue costs | | | 82 | | | | 223 | |
| Depreciation expense | | | 6,466 | | | | 5,700 | |
Subtract: | | | | | | | | |
| Capital expenditures | | | (8,998 | ) | | | (18,326 | ) |
| | | |
Free Cash Flow | | $ | 11,818 | | | $ | 745 | |
| | | |
| | | | | | | | | |
| Year-to-Date | | Q3 2006 YTD | | Q3 2005 YTD |
| Net income from continuing operations | | $ | 30,017 | | | $ | 28,840 | |
Add back: | | | | | | | | |
| Stock compensation expense | | | 3,605 | | | | 669 | |
| Amortization expense | | | 2,523 | | | | 2,693 | |
| Amortization of deferred issue costs | | | 242 | | | | 597 | |
| Depreciation expense | | | 18,776 | | | | 16,923 | |
Subtract: | | | | | | | | |
| Capital expenditures | | | (34,499 | ) | | | (56,685 | ) |
| | | |
Free Cash Flow | | $ | 20,664 | | | $ | (6,963 | ) |
| | | |
- END -
