CHEF - Earnings call transcript Q4 2024 | The Chefs' Warehouse, Inc.

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Operator

Greetings, and welcome to the Chefs' Warehouse Fourth Quarter 2024 Earnings Conference Call.

As a reminder, this conference is being recorded. Â I would now like to turn the conference over to your host, Alex Aldous, General Counsel, Corporate Secretary, and Chief Government Relations Officer. Please go ahead, sir.

Alexandros Aldous

Thank you, operator. Good morning, everyone. XXXX call Leddy, Pappas, should our to fourth today's CEO; Chairman, have on our Jim release. and CFO.Â By quarter me are Founder, Chris and access With press earnings now, you and per can net adjusted this call, cash measures, EBITDA, income, section. Â Throughout free including, adjusted be Investor non-GAAP historical debt others, earnings be conference at under net we www.chefswarehouse.com It the share, also and expenses, Relations among presenting leverage, will adjusted operating financial found flow. estimated adjusted EBITDA, These not may in financial with be companies. accordance calculated by non-GAAP used measures titled calculated are GAAP differently and in measures other similarly reconciliations Quantitative estimated today we will formal part statements remarks, in non-GAAP appear today's discussion their to press remind including regarding of our I release our need begin most our to performance. quarter measures everyone presentation. Â Before directly of and that include GAAP earnings measures our comparable statements, financial fourth financial forward-looking financial XXXX future put forward-looking performance, to and Such guarantees cause you uncertainties we are differ from expect. that reliance actual numerous what them. Â These undue should subject risks materially could statements statements therefore, and to on results are not of not

in business Others Some and Form available on mentioned are these today's disclosed update our SEC website. Â Today, reports detail. in the results report to on of our a in go XX-Q, going annual Form release. provide quarterly risks and are XX-K are on which are fourth-quarter we over

open I the only. at Pappas. the Earnings this over of posted will call section under to portion Then are Relations for Presentation. slides our morning, we for the will slides time website XXXX these that, on Fourth a For Warehouse few this disclosed Please Quarter illustration titled that to Chris? Chefs' call Chris we refer turn questions. Â With discussion purposes the up a will Investor note

Christopher Pappas

healthy environment fourth XXXX our a dining for Business base. higher-end remained demand upscale casual Thank through Thank strong the joining you, for core all quarter earnings to consistently Alex. fourth-quarter call. customer you amidst and activity our

more to X.X%, X share, excellent Our A product center-of-the-plate prior quarter customers Warehouse X.X% the the busy our points by to X adjusted XXXX profit teams versus and approximately Full-year our was continued of in XX than include fourth digital Gross basis growth supply XXXX. per versus prior XXXX X X. provides refer Slide orders to via XXXX. up approximately first dollar of XXXX, were basis XX% quarter, few XXXX. Â Now in points XX margin the approximately please growth the X. season holiday in coming XX% The orders please and points. provided versus charts via in X as driven profit and the while revenue compared billion-plus profit margins Jim platform, across mobile growth, by presentation. and to a gross our placement customer-facing profit website. strong year's margin. Â During a which employee strong few of profit and quarter. Â Gross EBITDA Investments year, on basis increased and quarter unique enhancements in placements case dedication includes of highlights of the growth online and Pounds gross amidst as their the and service margin commitment as and gross progression were Specialty refer markets the approximately XXXX year-over-year. team please enhancement fourth Slide in display compared history with to of to year-over-year decreased and full-year specialty and like to closing contribute improved domestic partners, dollars fourth quarter net we and to delivering detail supporting update points customer center-of-the-plate here basis over and Chefs' adoption delivered XX as from customer route Chefs' order of international moments. Â Now operating $X specialty growth and sales for both and provide category XX.X% drives margin for Chart expense increased provides the increased X.X%. the I'd market XX.X%, platform shareholders. Â Now team our growth margins digital versus XXXX higher customer our which sales. XXXX sales XX Chart unique in the X.X% thank points growing approximately category a acquisition. functionality, refer year analytics Slide in adjusted the full-year gross improvement continue real-time gross to XXXX in team will coming a data item a growth teams. members, per new to basis our strong dollars our Warehouse entire and percentage

expanding specialty of our approximately versus locations for our over expectation key continued X. to XXXX. Â Now at ordering this next our online Investor through look liquidity. are areas these information profit adjusted We above-industry focused refer domestic five Jim? the and EBITDA XX% quarter on of teams and XXXX XX% X As as please I'll targeted financial our in of to customers Slide quarter deliver well forward over Day that dollar more fourth Jim an turn of incremental the improvement top-line areas that, to and in update four Slide growth EBITDA March. Â With our as more on to gross detailed adjusted discuss average year-end it the XX% each our XXXX, to plays of the coming order on at margin years.

James Leddy

results sheet a Chris, an everyone. good provide provide the prior quarter of year balance X. morning, to and liquidity. Â Please our operating comparison versus I'll on you, now current update our and refer quarter Slide Thank and

fourth increased quarter, the the the our to and continued and by for consisting in of center-of-the-plate was quarter quarter impacted quarter million billion remain of quarter. the of to prior-year in Texas. prior-year inflation was category specialty fourth sales elevated inflation the inflation product X.X% Reported versus versus primary X.X% category in X.X% in category December growth net prior $XXX.X XXXX, cross-sell in inflation chocolate ended Our year the Net from factors $X.XXX XX, two approximately quarter.Â Prices X.X% fourth specialty in XXXX. the versus the our in

we cases XX% combine mix XXXX our dollar case the legacy quarter with As per of average specialty sales the Hardie's produce and operation, approximately protein fourth higher as Hardie's of specialty increased. revenue increased our in versus

fourth cross-sell impact $XXX.X XXXX of for inflation million versus of $XXX approximately quarter Excluding the approximately profit increased million the fourth of to inflation margins was X%. Â Gross quarter the the Gross XX.X%. and profit basis approximately to overall aggregate was growth, XXXX. company X.X% for X.X% the XX specialty increased Texas for points

delivered the increase facility profit quarter of year XXXX. versus million costs dollar sales investments primarily of distribution from teams general, to and the categories growth.Â Adjusted higher with quarter. and million fourth fourth strong and to Our XXXX operating due amortization associated The procurement, support pricing, sales, $XXX.X prior quarter. Â Selling, driven growth administrative the $XXX expenses expenses for X.X% compensation,Â facilities was fourth by increased depreciation and quarter increased during to and for gross across approximately operating the X.X%

year's of for XX.X% in of quarter operating by partially As end Operating XXXX income The million for had profit, fourth $XXX.X income Please primarily liquidity quarter $X.XX had in of $XX.X of of of to administrative adjusted for quarter availability fourth $XX.X net fourth compared Slide share share the compared million, of was increase diluted On offset versus net of was the to was the higher by prior quarter.Â Turning $XX.X $XX.X $X.XX for $XX.X $X.XX we facility. $XX under to fourth diluted the the update to XXXX expenses to liquidity. diluted share higher a XXXX. quarter, sheet fourth our XXXX. million operating fourth the quarter. the an quarter quarter of adjusted of million to X. Â At were year the XXXX for million the percentage income income share of diluted GAAP $XXX.X of $XX a fourth we balance refer Adjusted million cash basis, the million on our EBITDA ABL selling, fourth $XX.X non-GAAP the prior-year or expenses million comprised quarter per of for $X.XX compared income for per prior or million per or compared net general the fourth driven $XXX.X of million gross for sales, and quarter. Â Our for XXXX per XXXX. was fourth quarter or and the total million and net

and to Please maturing convertible EBITDA be of to at $XXX therefore, diluted plan $XX.X approximately debt and full-year you. net prepaid the XXXX be will shares For XX, XXXX, term adjusted debt was future.Â Turning of XXXX. to million and the timing to million, maturity in on million. the December flow will we timing XXXX. a EBITDA range this foreseeable follows.Â We in cash of XX.X providing we shares combination point, dependent conversion partial as net net will note full And to be million due X.Xx on the the XXXX. conditions, count range $X.XX net EBITDA the million all as to for the We cash between authorized net for under of full year million our future of XXXX, billion on year-end, sales and the of X.Xx be notes we cash our Share equivalents. we of any expect in as convertible full-year million fiscal to of debt that the and $XX XXXX XXXX, price, to adjusted the our profit and year year-end at we by fully compared million generation. Â As million of payments $XX.X cash to XXXX $X.XX the questions. dilutive, billion, total December settled $XXX share This in $XXX XXXX the between shares.Â Thank business, the it expect be increase to Operator? share X.Xx loan. principal continue shortly X.Xx for totaled open repurchased gross guidance for holders. share up approximately free approximately $XXX conversion. following shares, be trends The approximately that full and will year Due guidance $XXX to notes and certain our to Net adjusted was resulted plan XXX,XXX are current for million repurchases of $XXX.X the certain the debt to count Based our of market for under XXX,XXX estimate in in to by full XX in reduction we financial an of repurchases estimate be year million,

Operator

[Operator Instructions] The Carden Mark line first question comes UBS. the of from with

Mark Carden

Did have quarter. how heard did the So to of called across bit differently? start, about see December? act from in guys you any southern just industry traffic simply winter you much impact consumer an then the softer impact higher-income And we've seen you that wildfires? from guys quarter-to-date the and California strength out the a Or storms the

Christopher Pappas

just the typically from Thanksgiving we to some a Yes. during cadence would of solid say weeks think fourth anticipating were that. lot strong didn't I were the impact quarter from strong. Christmas, Those No, the but really X a I really maybe And see that was season. evenly period holiday or for people pretty shorter

have really a on lost hugely We geographically for not weather call us. a weather perspective.Â In anything the actually saw terms out L.A. in of market handful wide terms we to only fourth did on of nothing really demand some very fires there's L.A. material properties. that is in customers had quarter And that impacts, their of the January a big a or us. of and from the impact impacts So

So impact. there an going but a bit was a little have it's material not impact, of to

Mark Carden

sourcing? come of with but inflation play Or then fluid the most you occurs, to through pivot there's how If much Mexico, Canada, perspective? pass it's cases? tariffs And potential to these that could back And and for you in you I have import do Europe. terms a would know markets look from exposure -- in the into situation, an

Christopher Pappas

Yes. period I products we dealing that of and I Spain, wars ago, historically, that went through a remember back years we some I mean, some of come tariff with and believe. Italy from were the France

domestic. We the products of navigate suppliers now product I the find and X,XXX of it, our and amount been pass are other system sector, again, to think always lot solutions, have $XX I these think, are vegetables Chefs' mean, we've I lines Warehouse. fruits are from on. tremendous throughout right over our Mexico. boxes. able A A And at of largest

a bucks case. a few about talking you're So

the to the lot to mean, ups caused kind really not in Eggs $X.XX think I I had base eggs talking the downs. Â We our that of And So an up effect, customer Avian $XX, up. and our they're it's a entree? think really labor think, go recipe do night. much everybody But eggs I you we $XX, of that is more of headwind there's if right but $XX flu more about drives biggest of the is a goes into now, are up me type cost a when customer egg, even up, an high-end charging it's eggs. from keeps costs. to who's for that how used sell is, have about something average at operation.

Operator

comes question Jefferies. next with Slagle The from Alex

Alexander Slagle

greater OpEx, implied adjusted at I mean, ask and for OpEx time the quarter. on year-over-year for to because for do you I margin where in wanted think you started the X Congrats look in And opportunities to and opportunity margin X, flatten I gross favorability?Â And on get XXXX. that your you XQ when out midpoint the see the more quarters. percentage to just ask lever first the

So perspective. some opportunity. on see outside, upside curious to your from it solid place like a the looks But

Christopher Pappas

Thanks Yes. Alex. question, the for

were quarter. XXXX, big to of is guidance especially early weighted we didn't half fourth we in our In to heavily some rent until the fourth leverage the that be impacts year, the lap that back and operating investments the terms of upfront pretty of given facility quarter, the the going

improvement the 'XX, out little first leverage the guidance quarters and a of the how quarter, had lot in year to very obviously expected. operating XX So is EBITDA We basis points the of in that margin kind that then kind versus X the fourth and resulted played a of in 'XX.Â Â In XX range. we of

XX that again and of improve point And Our we over range operating at to that the basis things is are our leverage really, kind next below you are leverage as put OpEx. if in both gross projects incrementally all those 'XX. all to the improvement profit were about operating up growth close chart and that on we the margin adjusted X well goal financial dollar by in improvement 'XX once EBITDA executing that look years, of XX as goals, the and going into driving to them

executing So and really, it's getting just there team incrementally. doing then the the work is and

Alexander Slagle

to impact degree? that cost continue same food will do the on you outlook, And inflation think Hardie's cross-sell 'XX through the

Christopher Pappas

outsized we'll call of an the reported kind versus continues that the a impact I business that call With serving.Â Â So product having that have will continue. we'll corporate somewhat restaurants really sales, impact and and at an cross-sell. to are And bit the it's England. But on chunky it we'll what Hardie's, think of out to changes are number, we of outsized Well, it inflation to New number, grow out independent which core good one and versus trading we're similar continue impact volume the we with We're another. mix of call some it things customer lower continue if replacing what out. call quarter margin to street inflation

James Leddy

every job market. Alex, complete Unfortunately, that over past Yes. our to to was XX we a think the understand years. in solution say to little trying to it And Chef, your company to have I at understand become look you I goal a think makes harder us continue

we're every with company we goal So the have to specialty evolve it's depending are to on a growing and to very, solution protein growing, how are have offerings, market. sale And faster. line.Â Â So depends of numbers in each our teams It offerings a our market, happy fresh very because it And continue now our going be maturity is than time. called the with fresh or is continually long we combined our protein that to growing going the fluctuate we faster if is growing. but fresh broad for hybrid

we've solution maybe our on it's our of overhead, invested leverage I to few seeing start you're you volume, to as start succeed.Â And phrase think and continue go-to-market we because XX as a going and continues are the think teams I doing and that basis people heavily the using a to get especially get the how strategy talking facilities. evolve total that see success different our I'm where for us about new in to and marching grow we years, that we year we're leverage the points technology to And keep start goals. towards our next maybe

Operator

Peter with comes of question line BTIG. next The Saleh from the

Peter Saleh

year. inflation bit great update. historical little just an you're inflation, thinking I for to maybe on X% if Chris, update is know in be to wanted could you costs. or general And the past, what with and volatility. give labor maybe ask if outsized? little of the you you a in commodity a a first in on XXXX scenario an bit you've you think on us Congrats line mentioned just give on going mentioned of to I availability then with commodity us inflation labor And just that's optimal X%

Just any I've in XXXX And would be you're a then thoughts quick helpful. follow-up. on what got expecting

Christopher Pappas

let X%. me back mean, the X of we're think eggs we're seeing still Well, you The at going this that ball is mainly we point. crazy right big back inflated. Peter. but I those it's now out to Sure. kind really if get But crystal is I people chocolate got again, what's categories, market what seeing with out But better, out X%

little But the a the today, control drastically.Â Â I people X% everyone egg to probably much I from seeing that the meat don't seat anything don't we enough besides we egg tariffs, that X% get the we market, see market. talking and hopefully, the mean, know down, for and And talk come is I of market, going relief. the about we'll really yes, we're get crazy I my stabilization. the about next on over Avian all headwind give volatility. the change the prices with to to start but beat, anything would don't big not flu relief the X talk think we're that see about So X, But I years.Â So I seeing tariffs, mean, that. We're on not cattle tariffs, egg

are job think So the our see great category and doing you I a really right results. managers now,

Peter Saleh

an investments rate? And growth Are where the then outside the in update the you give us within how would maybe guys getting from sales force? the And can I the sales this just from? the have on force, be most ask insight you made on there are talent industry? helpful. Any Can of industry, they you coming

Christopher Pappas

answer better a restaurants hard products in I expensive it's before. great delivering pay try I our delivering think mean to cities these downstairs. most It's than night up trucks we're a really, we hard. fair the and a your to in it didn't mean like labor people work of driving world. Well, and Yes. job, I and the big very job, competitors.Â We working question hard shifts to and we because really best

I need And have where think were best it that the out So to don't we we was the obviously team. of challenged. that COVID is really issue coming

I really stabilized. think it's

stabilized We force. labor have a

does can the who in trying more think become from walks in we best been the people your continues have investments dividends hire I'm all take and force. that see hire sorry. and as we real us we more life. lot we HR, from also passion recruiting, was think and time more I I So sell books.Â That takes really of and of in of CW think a a it The question? get I energy, a diverse.Â I I it all to I of training, sales off time, investment house, from people very our diverse It's hire what And yes. to the investments the food, for spending a in our the years. that what's paying perseverance, because is to call front it, few recruit don't that sales a the before.Â Â And kitchens, person force, headwind investments second even part had mean

a after So hiring the two a is cash big drain. people year wrong or who leave

recruit We seeing think people have see resonates. I the the that our They people to stay that's say don't we're people So that I And and the of more people, had you're the to And years, they're growing. probably that sure in the talent because to recruit going out there. cap think think stay. job best I that Chefs' efforts it at the results becomes think them people. the would I three we I to making are really that And that allow keep Warehouse, doing us than two, story best have best that. best success helps going

Operator

Benchmark The comes Brooks Todd from next with question Company.

Todd Brooks

Congrats around kind case saw here. A gross questions Hardie's. inflationary in on of ordering digital drivers value, you some specific the pointed a great some of we margin, mix, strength couple to beneficial XXXX. higher at experience, the follow-up The profitability that and

boil kind we're As we improvement. magnitude, forward continued be on would 'XX, thoughts key that gross looking for just margin can a And drivers into if maybe outlook for of great. that of

James Leddy

the an go margins -- gross really implies kind and that for mix really I gross cetera, I the I inflation question, very because like guess, Thanks what we And what are delivered that's earlier things to well year as as output obviously product I in as guidance are deflation. of profit of margins full similar to profit changes, alluded kind the 'XX. and for back is Todd. et by affected

gross profit and dollars driving profit on focused we're again, once growth. So dollar gross

is boxes, Texas a So get more as trucks. we expensive good Hardie's example on

focused is goal to for then managing case drop, gross year. profit dollar expenses. whole more and a average, team as Opco as go the we is And on operating through per operating drive the Our per

think is then It's profit to not kind gross be gross guidance, to goal we our build expected our an when of execute range. build in And growth. perfect. just going I dollar we to So profit

So that's how we it. about think

Christopher Pappas

that now business, a run that a we're foodservice, what exist a and dollars in say, think years because it before we've and focus it's our been spread I $XXX to And between of a didn't the my case the marketplace case. was, where XX have Todd, seeing Yes. costs overheads, case eggs you saying in again, GP on $XX

You need high. cost is so because because making dollars XX%, make you're don't to GP your the input

is double costs. didn't -- go drivers So It triple up costs the up. and overhead cost it more, cost does but rent more,

you're in able piece. was to of a -- operate it's a it say now environment, a delays this So case that prime piece and $XX was $XXX

on You have certain muddle delivering is business changing. year. can the focus a focused we to improvement same mathematical between the dollars in spread the margin, operating really it's number. XX you that focus margin But saying it company. when we're point dynamic.Â So our GP it. And run our and cost the We on because are that's are of basis coming every the in mixes why the get crazy categories, the so And again, increases kind

more We expensive. lot focused are products them are a best company on the world. of A that's in the selling

expensive Our more customers ingredients. use

give Warehouse like to we're and become Texas, to Chefs' not kind market Warehouse Chef's a numbers $XX look box more Warehouse. operate to start of acquisitions in from a who that the volume stuck $X.XX Warehouse to start $XX $XXX food sometimes starts we fit we of Chefs' Chefs' and That's That's of a as a So it business rightsize talk not $XX we are. of like these why like we more make as a about of it's that become trying $XX distribution who comes million, more with million doesn't million, some up and And the and type million, is. case.

Todd Brooks

on it's about issues the chain labor just labor with packaging in outlook? one quick down whether an your How 'XX the as of business on from call. incremental key migrant are you processing kind side And looking as go guys availability, side being follow-up inflation maybe inflation or pressure of potential this the to supply topic the labor you meat a produce on and

Christopher Pappas

Yes.

I lot we got wages. way raised a past we few the mean years. the it ahead I of think of

to can to out realized in we would that And talent best pay get successful, to have most best think the we more. to look the you to I the each there, be people. for competitive, be again, market pay afford

we're think I doing So that.

not labor the already sure at a the coming keep I'm going I built we're into paying, upper because I market. see I market, it's So think think think, front and attracting our tremendous that from the end that to headwind talent, we're to of

good think there. I So we're

James Leddy

just facility I given that's investments lot processing butchers. of the couple Todd, in hire add the and that a we've of we to automation, on made allowed put the would over side, us that years, fewer processing last

so we as systems all the as well go that making And will help more And efficient. our mitigate forward. in is warehouse us

have phenomenal of that. we to the key success going how that you to doing be with So know to job out able the that's do less. a forward think more figure is to And I are our teams

Operator

[ ] Capital of question Street with the next Niebuhr comes Lake line Markets. Elle The from

Unknown Analyst

on Klieve. This taking my quarter is Ben for a and Elle on for thanks Congrats strong question.

to Florida provide How could Texas, utilization California, your Are forward? on you update compare do any trends an First, levels the locations? new in and seeing you going the expectations? initial regional these

James Leddy

by question, Elle. XXXX. by four utilization or We that in completed processing California, December we the for operating company levels But of one. disclose thanks general, -- don't the really completed market. facilities Northern in we don't Well, consolidation into move of in We

the customer earlier really facilities specialty multiyear That of doing we X to the path to a processing you order is Hardie's and that And of those for removing hopefully, of improvements I the of scale. from lot sense mean so exciting. levels with realize acquired in will of cost Chris well, in space operation. that innings grow noncore businesses mentioned separate those But facility,Â and taken of of early the starting that in synergies critical benefits markets that we're in where that We're Selling continue room strategy.Â Â So a as maybe the trading a Texas, in acquisition, protein different as to operating to getting in growth the getting in we're on different space side the mentioned was in to business. have out side.Â In large earlier, we've base some that up Houston. part markets, additional a and and on the to gives we routes of the some we we're I process of, investments. that number of the those driving are the free

Unknown Analyst

Could about expansion great. question, versus then and then in this How queue. down that's should back existing we initiatives I'll second your CapEx operations? expectations and sustaining year of in break think hop Yes, capital terms And spending? a for growth between maintenance strategy your the allocation you

James Leddy

Yes, sure.

to guided million And that our 'XX, get in we're of of revenue. $XX what to to gradually 'XX. similar CapEx X% $XX goal towards is doing to we million for down very So

to were I in think X.X% growth I we'll of we company, our a that basically be facility 'XX. investing in is closer In CapEx XX% at because we're think general, expansion. versus

will So and we allow Mid-Atlantic, between of we 'XX, have our in Pennsylvania, Oregon our facilities multiple over and a Philadelphia, facility in acquisition doing that and distribution a that as the Portland ago. result X did couple underway.Â Â And an have major years facility projects Southern build-out area, that then us Metro consolidate our to that optimize is Portland that New will retrofit that's we're Jersey we of New footprint York the

well. as end And the QX year or so 'XX. of at this complete that this place early that's to taking anticipate We year either of

in major really, our maintenance in facility projects. investments platform then digital our is of technology, So the CapEx. build-out, CapEx is those And are rest rest the and X the

Operator

with Kelly BMO comes Our question Markets. Capital next from Bania

Kelly Bania

into a was break how more X% more versus and are little between much us if markets to you that just conversation that contributing and wondering organic categories tie in receptivity I the you're and just to and bit the as and kind X% you growth about just learning protein talk down about mature obviously Texas high-growth could Texas the what market specialty markets integrate the help there. of

James Leddy

Chris all about to and Kelly. New England, mature growing, to a customers that to little and of bit that add Texas, at even that and made a cetera. and market. I'll outer-lying thanks, more California, it We're these kind So high-growth where capacity. there, color through where are at specific start in Florida are they're we'll markets turn then growing. anywhere where Investor group. But of the or time, L.A. work, between markets still invested we've but playing And San markets, markets I'll significant hybrid our out. California, still and the I'm growth you're to we've to and big we And a talk those and penetration in many Southern our are I'm And acquisitions in or continuing been and given Texas XX%.Â Â And growing people long most Dubai have very mentioning Francisco them are markets market obviously, this et working, with the if of like out markets, mature call dynamics then add Day. are like markets in strategy going a it's not aimed double growing of and Seattle, But digits, over about Northern the some XX% are

growth. or so kind of that still And mid-single they're of digits type growing

So your X% hopefully X% to Texas comment then of to kind strategy ask and comment just that on frames Chris growth. the the there. on I'll And

Christopher Pappas

have Yes. Thanks, Texas, again,Â over Kelly. think been a or through I you X, But the it at look years. I yes, be market. Yes, X mean, acquired time next the Warehouses, train in and Chefs' not top the drill businesses. exactly get X call to takes some to We've what this going They're before it technology to the and we salespeople. right buildings where and mix the we it's

typical everything I trying the giant done some get get that other second that's do think that sales why now, to you that who really just takes independents, acquisitions chain lot these patient going right like get we We more the of but a we warehouse comes we not that team probably are all and trained force of inning. of they're CW Texas what time. operators in on, aligned.Â Â We to in now and build time lot really we're customers with create And New into couldn't lot the that to formula. a being not them of Texas, I really opening accomplished, groups. I and with categories. little that's waterfall some We a Texas we get So of market. And really looking for served be and in of markets all culinary be our that then we've San in booming a a And distributor. Chefs' That's it's some really of fit build scene just think were is up we and and we're so what the bit understands out offboard in excited the our business but And the bought right. prouder Chicago.Â Â A and Warehouse L.A., transformation. We better small purposely, a call by with they've there's is that where the focus that's great shape maybe businesses, making York Francisco,

team really I next we're just starts then X more to X it think that's over And and more and continue march I think York, goal. like further going to that headway, or our making years. is the out, to great New and looking look

Kelly Bania

Just another follow-up.

I the specialty of order that think deck XX% digitally. slide customers mentioned

margin we wondering of bit gross service? favorably this growth? your of smaller little impacting kind competitors that that just more. gross is digital could you about if how this a type where profit up and going ramping of really Just Are And penetration And with see do talk specialty overtime?

James Leddy

the not over the up Yes. time, are phone. XX% to of think pick I mean I that going XX%, customers

and text it's e-mail, our it's using online capabilities. it's So then

a we It team though way. Warehouse. long tremendous better we we've still capabilities, get upside just and come that addition I a creates have to as As in long, build, our even and our dealing continues more improving Chefs' with improving to better, website dynamic think

in XX,XXX that over XX,XXX system. through some the items have We go markets,

sales such tool So it's just support great to a team. the

their for when a have while waiting mean do company, to think it started consultants.Â They we you've be remember to they ago, I say I sales the me heard I don't orders. what years did future pencil. now, computer, the the stuck of force that take at are was paper and

great. are consultants. suggesting, orders, they're the referring customers And salespeople know online were the customers And then orders they're hotels. becoming that items, jump now the they're And they searching. go freed They our can the over. are I think in, the they can when finding road salespeople. where menus is. are more laptops And and that take They WiFi, really is placing checking road from of didn't we So from big and strength as get their more they type on that's up next pull that solution items continues, carry changing or

We have tail. the long

many so of items. gourmet have the solution items helping that's different margins. think We and types And I what's

the I all I industry, And were our the with think I restaurant the that's think year our helping now, tools all less. training spending really little and and about of added a and down, placements.Â We a heard we saw divisions because counts into year, people protein we've were salespeople us. to new some aligned And we of the a haven't that's implemented just customer we that even and continue were going had companies. headwinds in tremendous of the was think, of

have tremendous upside we think to I So continue mature. we as

Operator

from King. line Wolf comes the Andrew question next The CL with of

Andrew Paul Wolf

Is last better training on. Chris, HR jobs And EBITDA some a the a year-over-year wanted are deck really were it productivity leverage on surge? what type I down as big little as in per to in on referenced big in more something productivity there give employee, or operating more that on better gross side and jump imagine through there and Is I much XXXX, of could there's going the from bit really increase. side, business the on where COVID I guys a -- of increase on people productivity profit a line, better catch-up think, I'm this sort -- XX% sort the is, look line? is sales finally color? on the of the a learning break But much so you us And you their employee profit getting and you you is year, that to impact sustainable? more be it practices of And well? to to the at if would you referenced the is

James Leddy

really it's a The lot by little leverage overall I'll and was that's quarter, when the investments Andy. 'XX And the lap our we I question, coming and in start Yes. over your and 'XX. that really of the with earlier, XX% with it facility with fourth part as leverage aligned of operating first uneven EBITDA mentioned the of driven cadence a them. improvement

productivity you're about like mentioned, gross with and dollar profit productivity did I chart. think sometimes spend the growth mix throughout margin as headcount great about because year, managing Texas, both improvement. you're a teams came talking driving Chris that operating our dollar margin It shows that from the of improvement product up and the perspective, on et profit growth from boxes selling I minimal a you're in markets more talked that job And get with you'll and different managing So the expensive yes, or gross cetera.

And then So just I'm really it's was? teams comes -- all that that our part your it strategy. executing on sorry, question -- from the of last

Andrew Paul Wolf

XX%. I is outlook. per EBITDA up headcount XX%. up EBITDA the is mean Just your The

Just I sort you net add can't didn't new the the of back headcount. implies of that's plan. it envelope, imagine

-- year? just look of to a going a I'm this sense it the I it be and is like that you know share asking. don't like. want improvement what So moderates I just I not go-forward XX% big is if to mean, to mean, -- number, is a and something I'm but

Christopher Pappas

got Andy, Goldilocks. bit model, mean, of everything. little think hard It's -- know look a Yes. you I a guys kind I at to I for it's but to it's you of

we $X XX stock the think in have them. billion to we taken weren't the that street had people doing and has may last you some went right the transform buying hits. up the The we from to down, because we've because gone be price, the think were and for I company $XXX remember numbers numbers always companies how we misunderstood million were years. I And to to see a and wants well So

buy. great the really there's us So is no is about exactly us.Â The thing there's bad like nobody like Chefs' to Warehouse thing one

big made So leap. buy And as Chef. them have transform that we we companies to we have to and

you of So but that know, thousands XX Sure, took warehouses. a built, to opportunities, of hired take we we different to a training. We We I had more that. the now to investments.Â So much the want don't up starting time, people. ago. position than ladder. you're I years we're in XX, were All lot trained, to be people now made acquisitive. of as we advantage any as We've had implement want we XX go people more to like expect systems. And better, industry, We mean, see highly production. in systems. We get transform get

in and stay. and get that's don't your we you're why master's don't bachelor's And expert an You make your now train to that want people PhD. field, you your becoming your and maybe

So everything, think those and rewards. it's a lot in investment of we're I reap starting to

share, putting maybe course, up a put Of now, you to team are and doing tough everybody's little market for But a hit numbers very is way our go and everywhere right is there's up restaurants and I a headcounts hurricane, in by down think some taking spend, numbers job. where we're market competition a the the backwards. great only

Andrew Paul Wolf

just one may. final And if I one,

think boost one Florida the that is know in capacity they these and it's -- either give us. yet, put don't if you of not are capital distribution or to while up sales California, but the that but have a one, centers returns market I stages could how -- Northern us longest-tenured a integrated they're sense looking? I mature with for performing, just be may I you the big early know just how expanding more ones cross-sell been the with open On

Christopher Pappas

and great Florida think newest doing know proud mean, if even there. a is really think been actually on they're such that's a firing be don't I for facility. us.Â L.A., is going think pistons, and of market we I And new we've to only all We're great. pretty them, I -- been Yes. years. mean I I announcing the it's they're X in ones, Florida we've

to facility built the So quadruple business. was that

capacity. So we have of lots doing They're great.

in facilities country. really a we're bunch into that California was we that to facility Northern facilities consolidated of latest the their earlier the we So Jim had The future. processing about referred of opened one one in most processing state-of-the-art excited a really

of So we're really consolidate through to there's went many those mean, I a excited a lot. lot about work. -- they facilities,

distracted. very were they So

I markets the entered other to rough still really think inning, down we're really last that years, under they're there's roof, Tennessee Detroit. in growth focus a in again.Â And outposts and now it for south on and catch few now sure everybody first they kind could of the into time small that I'm into we've it was up. But develop that we we've going slowed one

some have facilities. We new

new a New England to facility. need They're is going out operating multiple of buildings.

call So Jersey we've It's facility. movie excited opened that. before. Pennsylvania, that up not we what seen South our We really completed, about just but we're

going of exciting So on. things a lot

Operator

Ladies and now conference over Pappas are the gentlemen, would to like as there questions, further I closing to no hand Christopher for comments.

Christopher Pappas

call Sure. Well, thank our everybody for joining today. we

beyond. 'XX, and earnings you of looking the And very of companies very much. 'XX to proud everyone next joining looking great a forward we're CW and think we're call. we're in accomplished our Thank has family forward what I for

Operator

conference The the now participation. your Chefs' Thank has of you Warehouse concluded. you. for Thank

You may you. now Thank lines. your disconnect

The Chefs' Warehouse, Inc. (CHEF) 12 Feb 252024 Q4 Earnings call transcript