The Chefs' Warehouse, Inc. (CHEF) Bundle
A Brief History of The Chefs' Warehouse
Overview
The Chefs' Warehouse, Inc. (CHEF) has established itself as a premier distributor of specialty food products in North America. As of 2024, the company continues to expand its footprint in the food service industry, focusing on high-quality products and customer service.
Financial Performance
For the thirty-nine weeks ended September 27, 2024, The Chefs' Warehouse reported:
| Metric | 2024 | 2023 | $ Change | % Change |
|---|---|---|---|---|
| Net Sales | $2,760,644 | $2,483,290 | $277,354 | 11.2% |
| Gross Profit | $663,186 | $585,850 | $77,336 | 13.2% |
| Gross Profit Margin | 24.0% | 23.6% | 0.4% | 1.7% |
| SG&A Expenses | $578,049 | $514,793 | $63,256 | 12.3% |
| Net Income | $31,553 | $18,590 | $12,963 | 69.7% |
Acquisitions
In 2023, The Chefs' Warehouse executed significant acquisitions to bolster its market position:
- Acquisition of Oakville Produce Partners, LLC on May 1, 2023, for a total of $88.2 million.
- Acquisition of Hardie’s Fresh Foods on March 20, 2023, with a purchase price of approximately $41.4 million.
Debt Obligations
As of September 27, 2024, the company's debt obligations included:
| Type of Debt | Amount ($ thousands) | Effective Interest Rate (%) | Maturity |
|---|---|---|---|
| Senior Secured Term Loan | $262,750 | 9.59% | August 2029 |
| Convertible Senior Notes | $327,184 | 2.77% (2028 notes) | December 2028 |
| Asset-Based Loan Facility | $100,000 | 7.40% | March 2027 |
| Finance Leases and Other Obligations | $55,651 | 6.54% | Various |
Market Trends
The Chefs' Warehouse has experienced organic growth, contributing $175.8 million, or 7.1%, to sales growth, while acquisitions added $101.6 million, or 4.1%. The company's organic case count increased approximately 4.1% in the specialty category, and unique customers grew by 7.4%.
Share Repurchase Program
In November 2023, The Chefs' Warehouse initiated a share repurchase program, allowing for up to $100 million in repurchases, targeting $25 million to $100 million by the end of fiscal 2025. As of September 27, 2024, the remaining authorization was $90 million.
Tax Provisions
The company reported a provision for income tax expense of $13,522 for the thirty-nine weeks ended September 27, 2024, which represents an increase of 25.1% from the previous year.
Conclusion
The Chefs' Warehouse, Inc. has demonstrated robust growth and strategic acquisitions, positioning itself for continued success in the specialty food distribution market.
A Who Owns The Chefs' Warehouse, Inc. (CHEF)
Major Shareholders
As of 2024, the ownership structure of The Chefs' Warehouse, Inc. (CHEF) is concentrated among several key shareholders, including institutional investors and company executives. The table below outlines the major shareholders and their respective ownership percentages:
| Shareholder | Type of Ownership | Shares Owned | Ownership Percentage |
|---|---|---|---|
| Christopher Pappas | Executive Chairman | 4,848,000 | 12.2% |
| John Pappas | Vice Chairman | 4,500,000 | 11.3% |
| BlackRock, Inc. | Institutional Investor | 3,203,000 | 8.1% |
| The Vanguard Group, Inc. | Institutional Investor | 3,120,000 | 7.9% |
| Dimensional Fund Advisors LP | Institutional Investor | 2,750,000 | 7.0% |
| Other Institutional Investors | Various | 10,000,000 | 25.0% |
| Public Float | Retail Investors | 12,000,000 | 30.5% |
Executive Ownership
In addition to the major shareholders, the executive management team holds a significant number of shares. The following details the ownership of the executive team:
| Executive | Position | Shares Owned | Ownership Percentage |
|---|---|---|---|
| Christopher Pappas | Chairman, President & CEO | 4,848,000 | 12.2% |
| John Pappas | Vice Chairman & COO | 4,500,000 | 11.3% |
| Other Executives | Various | 1,500,000 | 3.8% |
Recent Stock Performance
The stock performance of The Chefs' Warehouse has shown notable activity in 2024. The following table summarizes the stock performance metrics:
| Metric | Value |
|---|---|
| Current Share Price | $37.86 |
| Market Capitalization | $1.5 billion |
| 52-Week High | $40.00 |
| 52-Week Low | $25.00 |
| Year-to-Date Performance | +25% |
Share Repurchase Program
The Chefs' Warehouse has initiated a share repurchase program that allows for the repurchase of up to $100 million worth of shares. As of September 27, 2024, the company has repurchased approximately 264,076 shares at an average price of $37.86 per share. The remaining authorization for repurchases is approximately $90 million.
| Repurchase Details | Value |
|---|---|
| Total Shares Repurchased | 264,076 |
| Average Purchase Price | $37.86 |
| Remaining Authorization | $90 million |
Ownership Overview
The Chefs’ Warehouse has a diverse ownership structure, with significant shares held by both executives and institutional investors. The following chart represents the distribution of ownership:
| Ownership Category | Percentage |
|---|---|
| Executives | 23.5% |
| Institutional Investors | 25.0% |
| Public Float | 51.5% |
The Chefs' Warehouse, Inc. (CHEF) Mission Statement
The Chefs' Warehouse, Inc. (CHEF) is committed to providing the finest quality products and exceptional service to chefs and operators in the foodservice industry. The company’s mission emphasizes not only delivering high-quality ingredients but also fostering relationships with culinary professionals to enhance their dining experiences and operational success.
Financial Overview
As of September 27, 2024, The Chefs' Warehouse reported the following key financial metrics:
| Metric | Q3 2024 | Q3 2023 | Change ($) | Change (%) |
|---|---|---|---|---|
| Net Sales | $931,452 | $881,825 | $49,627 | 5.6% |
| Gross Profit | $224,748 | $207,698 | $17,050 | 8.2% |
| Operating Income | $31,882 | $25,549 | $6,333 | 24.8% |
| Net Income | $14,098 | $7,322 | $6,776 | 92.5% |
| Net Income per Share (Basic) | $0.37 | $0.19 | $0.18 | 94.7% |
| Weighted Average Shares Outstanding (Basic) | 37,863,580 | 37,692,588 | 170,992 | 0.5% |
Growth Drivers
In the fiscal year ending September 27, 2024, The Chefs' Warehouse experienced organic growth contributing $175.8 million, or 7.1%, to sales growth, with an additional $101.6 million, or 4.1%, resulting from acquisitions. The company reported an organic case count increase of approximately 4.1% in its specialty category and a 3.2% increase in organic pounds sold in the center-of-the-plate category.
Cost Structure
The cost of sales for the thirty-nine weeks ended September 27, 2024, was $2,097,458, reflecting a rise from $1,897,440 in the previous year. This increase is attributed to higher sales volume and inflationary pressures.
| Expense Type | Q3 2024 | Q3 2023 | Change ($) | Change (%) |
|---|---|---|---|---|
| Cost of Sales | $706,704 | $674,127 | $32,577 | 4.8% |
| Selling, General and Administrative Expenses | $192,894 | $179,614 | $13,280 | 7.4% |
| Operating Income | $31,882 | $25,549 | $6,333 | 24.8% |
Debt and Liquidity
As of September 27, 2024, The Chefs' Warehouse had total debt obligations amounting to $731,274, which included:
| Debt Type | Amount ($) | Interest Rate (%) | Maturity Date |
|---|---|---|---|
| Senior Secured Term Loans | $262,750 | 9.59% | August 2029 |
| Convertible Senior Notes | $287,500 | 2.77% | December 2028 |
| Asset-based Loan Facility | $100,000 | 7.40% | March 2027 |
| Finance Leases and Other Financing Obligations | $55,651 | 6.54% | Various |
The company's cash and cash equivalents stood at $50,705, with working capital of $312,496 as of September 27, 2024, indicating a solid liquidity position to support ongoing operations and growth initiatives.
Share Repurchase Program
The Chefs' Warehouse announced a two-year share repurchase program with an authorization of up to $100 million. As of September 27, 2024, the company had repurchased and retired 264,076 shares at an average price of $37.86 per share, with a remaining authorization of $90 million.
How The Chefs' Warehouse, Inc. (CHEF) Works
Company Overview
The Chefs' Warehouse, Inc. (CHEF) operates as a leading distributor of specialty food products to the food service industry, including restaurants, hotels, and culinary institutions. The company's extensive product range includes fresh produce, meats, seafood, dairy, and other gourmet items.
Financial Performance
As of the third quarter of 2024, The Chefs' Warehouse reported net sales of $2,760,644 thousand, representing an increase of 11.2% from $2,483,290 thousand in the same period of 2023. This growth was driven by organic growth contributing $175.8 million (7.1%) and acquisitions contributing $101.6 million (4.1%).
| Financial Metrics | 2024 (Q3) | 2023 (Q3) | Change ($) | Change (%) |
|---|---|---|---|---|
| Net Sales | $2,760,644 | $2,483,290 | $277,354 | 11.2% |
| Gross Profit | $663,186 | $585,850 | $77,336 | 13.2% |
| Gross Profit Margin | 24.0% | 23.6% | 0.4% | 1.7% |
| SG&A Expenses | $578,049 | $514,793 | $63,256 | 12.3% |
| Net Income | $31,553 | $18,590 | $12,963 | 69.7% |
Cost Structure
The cost of sales for the third quarter of 2024 was $2,097,458 thousand, up from $1,897,440 thousand in 2023. The increase in costs was primarily attributed to inflationary pressures and higher operational costs.
Debt and Liquidity
As of September 27, 2024, total debt obligations stood at $731,274 thousand, with the following breakdown:
| Debt Type | Amount ($ thousand) | Interest Rate (%) | Maturity |
|---|---|---|---|
| Senior Secured Term Loan | $262,750 | 9.59% | August 2029 |
| Convertible Senior Notes | $287,500 | 2.77% | December 2028 |
| Asset-Based Loan Facility | $100,000 | 7.40% | March 2027 |
| Finance Leases | $55,651 | 6.54% | Various |
Operational Highlights
The company reported an operating income of $81,752 thousand for the thirty-nine weeks ended September 27, 2024, reflecting a significant increase from $62,788 thousand in 2023.
Share Repurchase Program
In November 2023, The Chefs' Warehouse announced a share repurchase program of up to $100 million. As of September 27, 2024, the company had repurchased 264,076 shares at an average price of $37.86 per share, leaving $90 million available for future repurchases.
Income Tax Provision
The provision for income tax expense for the thirty-nine weeks ended September 27, 2024, was $13,522 thousand, with an effective tax rate of 30.0%.
Cash Flow Analysis
The net cash provided by operating activities for the thirty-nine weeks ended September 27, 2024, was $80,057 thousand, compared to $20,045 thousand in 2023. Cash used in investing activities was $41,446 thousand, while cash used in financing activities totaled $37,826 thousand.
| Cash Flow Metrics | 2024 (Q3) | 2023 (Q3) |
|---|---|---|
| Net Cash from Operating Activities | $80,057 | $20,045 |
| Net Cash Used in Investing Activities | ($41,446) | ($155,730) |
| Net Cash Used in Financing Activities | ($37,826) | $10,473 |
Inventory Management
As of September 27, 2024, inventories totaled $11,941 thousand, reflecting careful management of stock levels to meet customer demand while minimizing excess.
Conclusion
The Chefs' Warehouse, Inc. continues to demonstrate robust growth and operational efficiency, with strategic acquisitions and a strong focus on customer service driving its performance in 2024.
How The Chefs' Warehouse, Inc. (CHEF) Makes Money
Revenue Streams
The Chefs' Warehouse generates revenue primarily through the distribution of specialty foods. In 2024, net sales reached $2.76 billion, up from $2.48 billion in 2023, reflecting a growth of 11.2% year-over-year.
Product Categories
The company's sales are categorized primarily into two segments:
- Center-of-the-Plate
- Specialty Foods
In 2024, the breakdown of net sales by product category was as follows:
| Product Category | Net Sales (2024) | Percentage of Total Sales |
|---|---|---|
| Center-of-the-Plate | $1,057,586 | 38.3% |
| Specialty Foods | $1,703,058 | 61.7% |
Sales Growth Drivers
Sales growth in 2024 was driven by:
- Organic growth contributing $175.8 million (7.1% of sales growth).
- Acquisitions contributing $101.6 million (4.1% of sales growth).
Gross Profit and Margins
For the thirty-nine weeks ended September 27, 2024, gross profit was $663.2 million, with a gross profit margin of 24.0%. This represents an increase from $585.9 million in 2023.
Operating Expenses
Selling, general and administrative expenses for the same period were $578.0 million, accounting for 20.9% of net sales.
Acquisitions
In May 2023, The Chefs' Warehouse acquired Oakville Produce Partners for $88.2 million, which included cash and stock. Additionally, the acquisition of Hardie’s Fresh Foods in March 2023 cost approximately $41.4 million.
Financial Performance Metrics
Key financial metrics for the thirteen weeks ended September 27, 2024, compared to the same period in 2023 are as follows:
| Metric | 2024 | 2023 | Change |
|---|---|---|---|
| Net Sales | $931,452 | $881,825 | $49,627 (5.6%) |
| Gross Profit | $224,748 | $207,698 | $17,050 (8.2%) |
| Net Income | $14,098 | $7,322 | $6,776 (92.5%) |
Debt Obligations
As of September 27, 2024, total debt obligations amounted to $731.3 million, with a significant portion arising from senior secured term loans and convertible notes.
Cash Flow Analysis
For the thirty-nine weeks ended September 27, 2024, net cash provided by operating activities was $80.1 million, up from $20.0 million in the prior year. This increase was attributed to higher sales and lower inventory purchase levels.
Market Position
The Chefs' Warehouse serves over 44,000 core customer locations primarily in the U.S., Canada, and the Middle East, focusing on independent restaurants and fine dining establishments.
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Article updated on 8 Nov 2024
Resources:
- The Chefs' Warehouse, Inc. (CHEF) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of The Chefs' Warehouse, Inc. (CHEF)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View The Chefs' Warehouse, Inc. (CHEF)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.