Performance Food Group (Nasdaq/NM:PFGC – news) yesterday announced what it called “a new high” in net sales and net earnings for the three months and full year ended 29 December, 2001.
Sales for the fourth quarter of 2001 amounted to US$920.1m, up 36% from US$678.0m in the year-earlier period. Net earnings for the quarter increased 70% to US$13.5m compared with US$7.9m a year ago. Net earnings per share for the quarter increased 24% to US$0.31 per share diluted on 41% more shares outstanding compared with net earnings of US$0.25 per share diluted in the year-earlier quarter.
Sales for the full year amounted to US$3.2bn, up 24% from US$2.6bn in 2000. Net earnings for 2001 increased 62% to US$43.6m compared with US$26.9m a year ago. Net earnings per share for 2001 increased 22% to US$1.11 per share diluted on 33% more shares outstanding compared with net earnings of US$0.91 per share diluted in 2000.
All share and per-share figures reflect the 2-for-1 stock split distributed on April 30, 2001, the company said.
The company indicated that net earnings, excluding goodwill amortization, amounted to US$0.32 per share diluted for the fourth quarter, up 14% from a year ago and earnings on the same basis for the full year 2001 totaled US$1.24 per share diluted, up 25% from 2000.
C. Michael Gray, president and chief executive officer, remarked, “The results for the fourth quarter represented the 28th consecutive period in which net sales and net earnings have increased versus the prior-year period. Sales grew 36% for the fourth quarter and 24% for the year versus the respective year-earlier period. Internal growth amounted to 8% for the fourth quarter and 10% for the year, and the remaining portion of the sales gains for each period was contributed by acquisitions. We are pleased with not only the duration of that record of expansion but also the fact that we have outpaced the growth of the foodservice industry as a whole.
“The outstanding progress we achieved during 2001 reflected solid execution in all aspects of our growth strategy across all of our business segments. In our broadline segment, our emphasis remains on further increasing sales of our propriety brands, continuing to increase our mix of street sales and increasing our penetration of existing accounts. Sales of our proprietary brands increased 24% and represented 17% of street sales, up from 15% in 2000. In addition, our mix of higher margin street sales increased to 45% of broadline sales in 2001 compared to 44% in 2000. Our broadline segment also made progress in further penetrating our existing customers as evidenced by a 10% increase in sales per delivery.
“Our customized segment continued to execute its strategy of selectively adding new accounts with the start of service to approximately 250 Ruby Tuesday, American Cafe and Tia’s Tex Mex restaurants. The roll-out to these restaurants should be completed by the end of the first quarter of 2002. During the fourth quarter of 2001, we also completed the previously announced acquisition of Fresh Express. The integration of Fresh Express with our existing fresh-cut business is proceeding on plan, and we are excited about our growth potential in one of the fastest growing segments of the food industry.”
“A key element of our growth strategy is to pursue strategic acquisitions, which we accomplish by maintaining a strong balance sheet. During the fourth quarter, we raised an additional US$143.4m in new equity by issuing 5.8 million common shares and US$201.3m of convertible notes, the proceeds of which were used to fund the acquisition of Fresh Express. This leaves our balance sheet in a very strong position with a debt-to-capital ratio of 31%, excluding invested cash of approximately US$68m. In addition, we have obligations under our master operating lease facilities of approximately US$83m, and we have sold an undivided interest in certain accounts receivable under our receivables purchase facility of US$78m. Our solid financial position will allow us to remain flexible and execute our strategies.”
Gray concluded, “We are optimistic about our overall growth prospects and expect that continued execution of our growth strategies will yield further improvement in operating margins. The well-established trend in the foodservice industry is one of increasing demand. We are fortunate to have the financial resources to invest in our business and believe that we are well positioned to take advantage of new opportunities.”
To view the full set of results, click here.