Performance Food Group (NYSE: PFGC) reported Q2 EPS of $0.58, $0.14 better than the analyst estimate of $0.44. Revenue for the quarter came in at $6.1 billion versus the consensus estimate of $6.13 billion.

Second-Quarter Fiscal 2020 Highlights

• Total case volume grew 6.7%
• Net sales increased 31.5% to $6.1 billion
• Gross profit improved 15.7% to $711.2 million
• Net income declined 4.4% to $41.2 million primarily due to higher interest expense
• Adjusted EBITDA increased 22.2% to $142.9 million1
• Diluted Earnings Per Share (“EPS”) decreased 4.9% to $0.39
• Adjusted Diluted EPS increased 9.4% to $0.581

“After a strong start to the year, I am pleased that our business momentum continued into the second quarter. Our results were driven by solid top-line performance and strong EBITDA contribution from both the Vistar and Foodservice segments,” said George Holm, PFG’s Chairman, President & Chief Executive Officer. “We are pleased with the broad-based profit contribution across our operating segments and are excited to have closed the Reinhart acquisition as planned. The early integration of Reinhart is proceeding very well, and we remain on track for another year of strong growth across our Company.”

GUIDANCE:

Performance Food Group sees FY2020 EPS of $2.17-$2.28, versus the consensus of $2.03.

For fiscal 2020, PFG raises its Adjusted EBITDA growth outlook, which includes expected contributions from Eby-Brown and Reinhart, to be in a range of 27% to 33% over its fiscal 2019 Adjusted EBITDA of $475.5 million1. Adjusted EBITDA excluding the contribution from Reinhart, but including Eby-Brown, is expected to grow in a range of 13% to 16% versus the previously announced range of 10% to 14%.

PFG is adjusting its fiscal 2020 Adjusted Diluted EPS guidance. Adjusted Diluted EPS is now expected to be in a range of $2.17 to $2.28 representing a growth rate of 2% to 7% over its fiscal 2019 Adjusted Diluted EPS of $2.131. Adjusted Diluted EPS figures now exclude the impact of intangible amortization expense in past and future periods.

This outlook is now based on the following assumptions for fiscal 2020:

• Organic case growth in a range of 3% to 5%, which excludes contributions from Eby-Brown & Reinhart;
• Interest expense in a range of approximately $115 million to $120 million;
• An effective tax rate on operations of approximately 26%;
• Capital expenditures between $180 million and $200 million, with depreciation in a range of $175 million to $185 million and amortization in a range of $65 million and $75 million.

For earnings history and earnings-related data on Performance Food Group (PFGC) click here.