US Foods ( NYSE: USFD ) shares rose on Thursday as rising revenue overshadowed a narrow bottom-line miss on earnings.
The Illinois-based foodservice distributor posted a 15.2% increase in net sales from the prior year to $8.8B. Meanwhile, gross profit increased 18.3% to $1.4B. The sales report came in $130M above expectations, while profits only narrowly missed estimates as expenses climbed sharply. Food cost inflation across categories helped increase profits and worked to offset a 375 basis point impact driven by the exit of the lower margin grocery retail business instituted during the pandemic.
“Our results this quarter demonstrate significant progress on the execution of our long-range plan,” Interim CEO Andrew Iacobucci commented. “We remain well-positioned to deliver profitable growth and value for our shareholders in a challenging macro environment and I am confident in our ability to achieve our 2022 outlook and long-range plan.”
The company expects adjusted EBITDA to range from $1.2-$1.3B for the full year, “with continued confidence toward the higher end of the Adjusted EBITDA range.” Adjusted Diluted EPS is anticipated to range from $1.95-$2.25, below analyst consensus set at $2.26.
Interest expense in 2022 and now expects it to be $245-$255M as a result of higher anticipated interest rates.
Read more on the details of the quarter .
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US Foods revenue rises above estimates, costs cut into profits