US Foods Holding (USFD) 7 May 192019 Q1 Earnings call transcript

Good morning. My name is Ramon, and I'll be your conference operator today. At this time, I would like to welcome everyone to the US Foods First Quarter Fiscal 2019 Earnings Call. All lines have been placed on mute to prevent any background noise. After the speakers' remark, there will be a question-and-answer session. you. Thank instructions] [Operator Ms. Vice and Senior floor Relations, is yours. President, Napier, Investor Treasurer, the Melissa

much, good and firm first-quarter question Pietro Ramon, to very questions an CFO. you Please Thank and comparing will Dirk results XXXX provide call. and year call and your conclude. Locascio, provide here during results. Pietro we're CEO; and our our on morning, one I'm your XXXX. to today year remarks and otherwise our prepared with after yourself our our Satriano, take to update Dirk our fiscal your QX period Welcome everyone. limit stated, the unless today's in name first-quarter same We'll fiscal

today's the accessed presentation slides Our release earnings can investor website. page and on of our issued earlier morning relations be this

measures. addition information, In to which factors are lastly, to filed reconciliations comparable from in are expressed potential point for I'd during considered the today's like financial during the Pietro. those over differ release. turn that call, our these to our will included statements. And made measures in And press with latest those call implied refer statements risk actual Please the certain or results Form cause XX-K our review GAAP SEC in call earnings historical non-GAAP forward-looking out financial we most in materially to certain I'll the statements. today's to All the schedules could to now factors,

with guidance we and achieve on line good start to first-quarter our are for our us our call. year our a call. discussed everyone, track XXXX earnings We thanks and Melissa. last the in we had that full-year with first-quarter results morning, targets on joining Good Thanks, expectations to for

X, an quarter's key following the three Page results points. with this of and overview begin Let's

we case since perspective, all accelerate First, middle of organic from quarter types. our as best customer the total XXXX the X.X% three and of growth was the volume growth for a was across

X.X% pleased We a organic behind with our are basis, the operational especially and our are public grew us. with since differentiated highlights strategy been resonate restaurant highest company. transitory This issues our that volume, on an which to continues customers independent we've

case. our customer the with XXth quarter continued profit mix Second, per the leverage growth private row, continued a generally rate seen, gross line brands a operating contributors in per expanded and challenges with Operating we were profit the at gross we've a for case both increases Improving result the did than of increases. in external in to growth in as historical distribution in higher in increase environment. profit expense primarily in gross

of our EBITDA resulting and increased in costs of quarter, adjusted for by markets line call, I'm result benefits some as higher and more the higher a costs this and the historically, is discussed last we confident offsetting than of seeing that turnover we're the associated distribution benefits our of wage initiatives. portfolio seen chain year will we've progresses, As costs initiatives supply our least remain tight turnover. And adjusted we grew and confident our at EBITDA increasing achieving greater and X%. guidance our finally, higher and X.X%, from costs expectations of mitigate with greater full-year we labor in the our portion the as in with

market in outlook feel three independent by Volume is for take our quarter. all on the customer profitably a Headlined types. organic We strategy an to be restaurants continues quarter, on growth volume independents the differentiated X. look the share. with growth accelerated strong basis at for at X.X% growing sequentially and for now Let's beginning gaining closer resulting our Page

prior hospitality the to range on for quarter over X, X.X% fiscal XXXX. healthcare expect As come and the result, in Page end Still also the we high at a of improved growth some came for the the seen key our remains growth at End we and expectations. from line first have our X% strong improved with and in quarter, market of in demand customers. in

our to X% the growth for Our pipeline year. we X% which also us is strong, confident, rate will expected leave achieve

customers said with the does new volume more that quarter-to-quarter for past, associated QX size the we've discussion to quarter, our growth other customer And the first customers a and the type. the this improvement the a over very all and negative in flat XX at close lumpiness of cadence. the for of As last substantial predict difficult we group it timing for guided make came points, basis of to in roughly

access chain the low-margin year. last We now have that we discussed passed

This industry to this growth better industry continue available performance, by others. have publicly traffic shown with performing negative mixed customers. than which flat some is expect numbers, is as chain also We for the roughly part with consistent characterized concepts of

the So overall, volume a the remains as for environment competitive our industry strong stable. outlook and remains whole,

on update relative Let's are our On story of gave Page doing we last ago. elements turn the three how Day to that presented I call, at quick to Investor X. our year we a a our

differentiated to volume margin deeper growth this third, progress across with our on are on a second, types. cost. our to respect delve and key platform and customer how these focus contributing platform; of tailwinds to key differentiated Today, little our the enjoys; First, our some industry and both aspects I'd like

new basket. three exclusive a as which Also First, purchase let's are customers Scoop recall Spring talk higher to ended, who industry Foods. of launch platform, that that we and just products is our you our rate a year recall, products to which times the Scoop higher will US and innovative Scoop, about by retention

the Our operation. than continuing be that of sustainable And that -- a products. latest important sustainable to restaurant more operators indicating was I our -- to is that continues now substantially Sustainability spring hard apologies, trend, product our their to expand offering. launch XXX XX% with includes sustainability sustainability focused on portfolio from Scoop

purchasing of cases of to of trial with remains previous sustainability mainstream of at Expanding sales on how a highest XX% the key part Scoop you margins. just can As Scoop, customers see brands rate two which chart any from over to Spring left, show improve least strategy of restaurant independent become. Scoop, gross our private our the the goes has at our

brand just either into private of portfolio the Our brands unique better falling good, best over consists tier. or XX

and we private the sales similar from for As high-quality of of future. the chart, as execution on consecutive see we for foreseeable result the increases our our middle disciplined basis portfolio year, grown the can XXX part a sales by have force, and expect now points brand third penetration you

to element retain and new win our The differentiation our help of existing critical e-commerce us which business continues platform, third is business.

part restaurants our our and quarter with of the comes side XX% independent sales of than this e-commerce of volume penetration through reached slide, nearly As shown on Made right the more XX% Supporting total the e-commerce. Easy our restaurant Food. half very our Easy. which independent of of one areas our a close And our mobile are platform Great as now in are we Made And using to the app. is result, strategy. customers evolving mobile.

wave our also It You campaign. terms the differentiation We marketing third we strategy, our of of Make Help In support launched to digital

value-added of while operators. particular to increase dream and You on that make will opening their patient costs. continuing This Helping an It Make down her drive whether them achieve remember promise tools services our every that We entrepreneur a satisfaction, focuses food our Help we or to the pursuing looking promise, offer hospital goals, and it's them day campaign to helping to is their You customers. restaurant to our unique

margin So aspects gross with to product as contributing as our as you technology customer gains well customers, enhance can offering to platform, the growth see, on our and types. all we target continue both differentiated the of profitable across

quick two it to I Before over turn to I'd provide updates. Dirk, like

we're chief at to the large at and provide second, Essendant, pleased Tim remain FTC distributed he hopeful the We're US experience, served a First, more by acquisition. Tim he will like where brief will supply the we recently, Connolly remain officer welcome announce chain I'd of second our Group join quarter. the to Food that on And he with XX the centers. with a engaged years than distribution vice supply And end network Tim chain update excited of joined over we organizations. XX the leading close oversaw Uline. We to was as team. of SGA senior that new US to Foods president operating to as operations chief of officer. prior Most Foods

have now complete done are job of of waiting be Our and an integration exceptional for teams preparing playbooks XX% over day deployed. and to one,

know our are two our the conducted More soon. to importantly, we halls all join I US excited associates from combining of forward are Foods recent of and SGA that set town strengths companies facilities, SGA to looking across

Dirk close SGA continued to US associates Finally, thanking to it thank their I'd and commitment by our at make like serving helping our their dedication commitment of turn that's to for same over I'll Foods the walk for for Locascio to I it great like also down a balance our customers sheet. our to associates at SGA future with and P&L company. customers CFO made now a our

Pietro, Thanks, morning. good and

first-quarter X, acceleration quarter with higher combined increase EPS XXX growth nearly a year. quarter to case from billion, XXX the full period Slide customer pleased increase of sales And operating Our basis volumes the X.X% a X.X% in to a We're an net are the prior costs. accelerated distribution three QX were quarter very On all quarter. the GAAP EBITDA mix in business Case for increased over year. growth the on was increase types on wage We the was as independent focus $X XXXX expectations. further basis. of as our in points product leverage noted. on X.X% diluted was gains points our Pietro Gross adjusted case Slide which in Adjusted case driving for deliver for environment prior-year to spite basis noted, XXXX. continue reiterating Pietro results total the resulting and $X.XX of our cost profit the QX billion, restaurant an over the X, due above with the in and of $X.X experienced basis outlook other performance continue year-over-year gross-profit adjusted we with On and a X.X% largely of growth. first we and for in increased consistent continued first strong inflation of higher X% X% we

GAAP higher of GAAP This adjusted as prior-year relatively higher and a the and points would if period result points of on basis. been percent flat as adjusted percent XX.X% nearly is higher was gross basis a on profit both XX gross increased sales, little inflation a basis cost on basis have points flat. a the and sales was had As XX of a an five basis profit product than Adjusted basis. inflation

expansion a expansion times we such saw dollars and points mix customer strong continuation of by in prior and $X.XX which XXX case, profit to was gross discussed increased driven case optimization penetration, growth. and three initiatives freight per quarter. Our The private again again GP the year adjusted nearly per growth was rate quarter case brand we've as basis up this quarter, this the compared over

operating Moving points. X. to by for earlier cost year year higher million wage, to year the we of Adjusted Slide and $X over increase $XX expenses increased from to above timing X.X% operating well within and an were or $XXX Opex X increased the as million, XX.X%, prior percent basis driven of this million as prior-year other as shifts quarter, as a primarily sales of costs, had the expected. distribution expenses the X.X% acquisition-related on quarter in

as by expected. chain and We costs distribution be to impacted continue wage supply pressures higher

initiatives are Our service supply chain shared in benefits. delivering business

the not seeing. mitigate However, higher the benefits we're costs did fully

take mitigate As map. remain case as the per was opex distribution Pietro and as growing case right On Slide a execute QX. our higher gain operating case $X.XX shows We overtime very a the higher than profit fuel increasing and while adjusted control in as by wage the leverage opex longer we wages in results faster leverage GP we gross can believe meaningfully X, $X.XX result opex reduce our deployed. historically. per The little focused adjusted impacts per chain on of improve to supply away, of $X.XX are initiatives in opportunities they we our impact and initiatives increasing continue adjusted per we road per adjusted to as opex mentioned, the case case have operating

And balance result, per was first increases quarter, a the million $XXX X.X% the on year-over-year the we expect in EBITDA now the to over our X. As Slide year. period. cost over prior-year up Adjusted lessen of case

adjusted QX adjusted diluted X%, net adjusted sales, And income of at for net X.X% percent EPS Adjusted right, flat for due to increased while income $X.XX a on growth. $X.XX primarily As EBITDA quarter. increased nearly or finally, per to far remained X% increased the the the EBITDA share quarter. X%

the cash impact $XXX debt balance to do QX of not and decline in expect expect capital flow million timing-related growth QX Turning XX. by to continue for driven of year. be now and capital million $XXX benefits was negative was Operating the net XXXX. working to compared most that on prior The flow in working XXXX flow extent largely for did year. over Slide this cash occur during 'XX same year the the We QX full cash we operating the mitigated to to

ratio Our strong debt million X.X business end leverage continues $XX $X.X our at levels was our operating and of ratio. decrease improve to the approximately from to debt quarter of our Net XXXX year-end net we've times. at leverage billion, produce flow cash and remained and decrease continued the a

XX. to Slide Moving now

are we we reiterating February. XXXX, in as outlook earlier, our I provided mentioned that fiscal-year For

line to to for per to back expect we EBITDA few of expectations results profit X% we first-quarter for the go to due gross now lesser were The a increases. case growth turn continue strong it comments acceleration, in before and per least full per continued and year, volume Q&A. with I'll year-over-year rate opex case adjusted gains at Pietro our

Dirk. Thanks,

the in operating in our delivering industry good initiatives So start place confidence guidance. year, strong, was everyone in growth that XXXX growth experiencing summary, private mitigate higher in and volume to to with the good growth is brands line with our especially in with independents, and costs expectations, a EBITDA

questions. let's now for up it open So

question first of Capital. line Bania the comes The Kelly from BMO instructions] of [Operator

quite start want case to strong. with Just clearly the growth independent

selling is curious much And the quarter? think even on down as growth what execution about driven you think Or versus you your internal of new how approach attribute environment the same-store you with customer Scoop of Just going that if sales versus what you during team-based track maybe independent external then, think the some much the you you backdrop? maybe dissected level, curious that, how to you wins? talked success it to your and by just did underlying

Good you at the change there's consistent if data data, of and has little morning, at what it's -- when over -- we been Technomic Kelly, relatively so environment that's look environment look been. external PD pretty the a consistent bit

go differentiation have issues over measure as should to being win of new last drop. So seen due as the of is the us, to few and us course really per strategy we've quarters, of we us of terms couple And penetration that continuing issues acceleration the behind quarters, I say, We to, often help customers. we increases I combination behind existing said, in both our put penetrate seen and operational customers up. lines operational

and existing are back so, to from wallet really balance us, growth a And growth that of of customers is coming penetration new to with on increased the share customers.

year. Okay. another your for on the guidance And just one

takes? metrics the of But color You improving through costs move think next the quarters. puts is So should case about of relatively we EBITDA of as call think year. you did the kind we Or any and per kind just any about maybe consistent? growth that there as X% couple out

is Good morning, Kelly, Dirk. this

Now there's of we as year. about nothing specific the the balance think

So it's to that order of the relatively in level growth consistently achieve year. for

question comes next Judah Suisse. Judah, Frommer from the of ahead. The line go Credit from

the little you case for independent then of us and Thanks the morning, good all during first help with at cadence taking basis? potentially cases, quarter-to-date just on taking Maybe on a my quarter further questions. a Hi can growth

can saw we There's as quarter. much throughout more this There's case strong share. much more not not we the went Dirk. Overall, -- we Sure. is growth

post be outlook anomaly share specific And the guidance can't space. our really in is, what the year say the no although quarter, our continues we would with to call So growth case even consistent I to out. numbers there's for and

reasons the have see. good So that as Pietro we about the about said, continue growth feel very talked acceleration we'd and he to

it in by you've that share you further Great. And said progress that can there that you're into but review? QX, the And further? salespeople update, puts retention SGA or know there the of then made of otherwise any in I SGA share? you you anything is on any will push deal just close is the end could the at out takes can hopeful and of insight terms

and the I'll of B XXXX way because, Part answer in little company Judah, Group terms broadly, continue to line performance ending your disclose perspective. the best more or have Part of their in question really B The as your a from expectations and -- to in So been information line know, your not private a top the respect reassure Food take disclose. a question is both you bottom we -- has with and everyone of that line to is to

Company to perform the continues So well.

In question, of process and process don't of There's that a terms it's is one timing, stages FTC there's also the a we're over certain we in. happen. your of first the which engaged part range control -- have

the that obviously the So and second the little really and second trail in be. a said, a could it's third of July July, end we between end quarter, of remain into it There's early as we that will might when complete transaction the that hopeful bit quarter to the hard by quarter. the I know chance

of from the Sullivan comes Lynch. Merrill line Marisa of question next The

to and will do follow-up quick closed? dilution you accretion a any order deal? outlook And contemplating to if previous the that the you from the change on really Just Are divestitures SGA. potentially that so, have deal get in for

enough soon can say terms about able that is it can't said form in we happening what think, when about you be talk and much can about we pretty that closes really we'll to takes. talk to everything what of process we So the I SGA. understand Hopefully,

more expected. inflation. comes an couple Have to it also inflation think able next to maybe bit going outlook to topics provide pass on -- than of the us like how to you is changing trend And a you through It sounds And our customers? been you. little quarters? can just it Got you for over

Sure.

So for as it's to in modest about grocery we've inflation talked really very see few quarters. continuing

those you up in point commodities, bit, normally it for markups And You case. be but to any generally increase and expect. to remind some which some tend pound saw time a on little tick we but lot the speaking, that depending have at And nothing of per significance very the consistent, through, that beyond, on able they pass per just commodities. or I'll you the more delays is of more of fixed time, a can't

So lot they impact on the bottom have. the the the more line than a focus impact we And execution top we'll as continue line. to

outlook think, I grocery the is our modest continue be pretty for for year inflation. to

As commodities, around to that's my it where a to coming tell continued for seen to since on make we more, they've in it focus see through we little execution as harder of some bit it then the we little a back effectively. bounce and we've to the sure, point gets manage

Thank Right. much. you so

from next line Kelly the of Please Wells ahead. of comes Edward The go Fargo. question

dig Hi the better are guess, -- it I for but wanted you worse that year, cost worse like $X.XX just then is this a appropriate per drivers guys an getting I -- But you what I hoping item at year-over-year the we delta, and I could key to side. a for the experiencing. was more like was about cost bit I pressure a key you about into into think seems year-end you target maybe full little last been that that? you. year dig end of here, how think the line just bit drivers? It really was, could guys. And the that maybe than Good the the thinking have case from was this sequentially. morning. about as to Cost little just talk behind better hoping

Sure. is Dirk, that. this I'll take Ed,

distribution-related we've and I the drivers think, labor it's about. as -- were QX, the fuel, talked primary costs around

pennies. first that little about we've some of was was earlier talked that increased few in a that a piece in bit the the a differences little quarter other timing hit the year The that

so deploy and in a year as impact have So of and we to, lesser is kind I little not across back control it in around of throughout you half, think bit the you first other gets and the just increase, becomes that think the fuel half. here Distribution getting a then mitigating as a better cost continue to our we the second balance of the as get business. larger the we that there, more things to go has initiatives, across negative

I that past. of employees give line or -- in back like be improving it's continuing more work the we'll seen -- environment down in, with about really number engage it's more then to that. to in it's the distribution and we're on working and to area especially target, more and work So a than the rather specific environment what we've over the turnover focused And in continue continue just around so our and and to think,

back narrative Great. follow-up the independent what's selling gain think now accelerated very actually? one a What with think take from as there a a I obviously, Can help understand key what year model about versus last are? the for nice And Pietro. issues model service just you're though guess, versus really Where and from your peers. selling is growth, just drivers And business around of nicely share and you, was, hearing you customers perspective? you better us you has level you step

of Selling two gross our as centralizing rates and Yes. model around of and opportunity managing sell a Ed, selling we parts, enhancements Look, wise. taking replenishment, to profit the journey on those advantage the the better was primary embarked result from this when freight goal customers. line

that's moon actually a an service we've is than fill-rate we're we were at on And to journey. which from to basis. higher what associated have Our in on result hope centralize found we levels tracking a embarked practices, around We're to Unfortunately, that able service levels. the achieved is higher we're actually renovation. than this a historical learning, to better that performing than as are necessary historically. best honest, perspective go function was level tools, this to XXXX, you're consistent and through drive stay the with why one, to when a service point, we when get this apples-to-apples which And be we because is better standardized you with

go fill-rate we from So perspective, and actually from there. feel up to we opportunities good a see

in can that So a environment do again, harder central do are much distributed a things you to in environment.

I Ed? of think, what your terms the other what's question, of selling your on was question Although the model? model, in selling part specifically the

was really take just your Well, concerns stand about today, and was step you're looking at a for about in productivity where you prior I -- you perspective going? back a selling -- the just from there where it and in like performance and point the this sort thinking think model of do year -- salesperson you the

Thanks that. thanks. for Okay

we've offered. just be investments that, of team-base of legs and truly to in territory experts the as and the work the job together stay terms continue more business, technology in that in technology stool to we're work the do to model. if front offering the to your more tools our as concept. because and it proposition allow seeing, acquiring not that's really book and we're our become consistent to keep made larger selling back concept not we look, consultative, believe be can the and of innovative to why that's customers And a the of in sellers best in three growth what they the expect and in The to and that historical our level, at levels there's talent we selling brand, terms of better products, we the And manage of model more of selling So increase, -- manager if that higher. specialists brand allow the specialist and

from Capital next please Andrew, comes the Wolf Markets. of Andrew And go question the of ahead. line Loop

the a expenses. on operating few have I follow-ups

to the or the the the First, just increased or stayed it incremental way did the per decreased quarter. you I looks increased us whether tell math, least cost just at in like clarify, case Could same? actually it

The that where a in in about. year-over-year quarter -- the was of were Is to would fourth increase as your and reasons of the versus that through talked sort I over -- first expect the increase the year little lessen that go we we that's quarter higher we for then the question? the balance to

Yes, Ed want and to thought, went math the clarify. just that one, yes. my it No, was it's I just other did, down, I

$X.XX Second, continuing? in inflation? called that of in other that's Is out or the that quarter, cost quarter costs. fourth Is case part of increased per healthcare is you that the inflation the type of cost

No. the norm. Health back costs care were to

there anomaly was more expected. as we had So no

talked timing drivers the cost seen the little And primary a quarter, labor, some other are, -- related were distribution, within and So I of there bit incremental the as about, the shifts also that fuel for costs. the then, of we've throughout year earlier.

increment cost regard think They're Is and just is last guess. I big I talking wages is at to it through state? that wage year. stabilize to increases rate that your least initiatives reliant a long or the the benefit at rate, current Okay. Or as on And about? you're of anniversarying that wages, variable largest happened the in the I was business running comes particularly some as natural which increases down lastly, extent, steady just more the some just that

Well, late those. some it's -- really a you so of anniversarying year the see would of

little less result a would lesser to increases the bit were as that. see so wage extent than you of the And a increase a that

as think, improvement forward. tight we significant it I to markets, a go assuming labor not environment, continued we're the

from really also actually a to which drive, assuming that initiatives focused productivity the term helped remained think, helped perspective. on engagement an very the and them from focused environment of those the really and driving used some So we've the a self-help back employee -- benefits I labor lot on very and that then similar

double So win, which with retention. they've the helps

the Guggenheim. question John The next comes from line Heinbockel from of

summer one or do the did as year? managers, last year. do or will you same that call, The the Is number last one business things. I add two idea didn't to year less? you about Scoop, guys, Okay more you would this And then

we're customers can but the for we the John, absorb do back really there's the model, to that. So our that plans we experimenting, reason much reason to one pretty only launch, we Again, so took out excited was summer sales and a is by we three territory our and because that year force wasn't were and had managers the Scoop, because will operating do last three it. But scoops. another is

the to certain, fairly the biz that and look the of close And Dirk about, new managers reaching we the adding managers, number I business are each you're terms of In are rate talking at end and of other. steady-state. of

you -- mentioned you that pass-through, no good up of was a bps. would think to we if those was you good way when We're had of momentum. space gross with been rebuild just on timing have conscious and have that to then decision? Is trying there our inflation, right, that some the items? up step Or about And XX accounts margin the

a be through. slower of deliberate Let's little Was that that part in a passing more or big it?

we're John, basis to that's is That profit the very case, to it be map that about when per per just in $X.XX points began a by we because rates simply how it a profit why with we gross ago commodities few years to acceleration pleased those this talk really Dirk. the really skew can can per and like gross case on skew, illustrate but was comes we continue case seeing.

go of Karen, Barclays. from comes ahead. line of Short Karen The next the question please

Thanks.

couple of a questions. Just

want -- kind that gave and of EBITDA because And I got Is there guess, conservatism really directional then back you bit even back first guidance X% that an I just to there element February you November, growth was kind is than of when is built rate. in opex fiscal question impression isn't guess, conservatism really the for first So that 'XX into I more that growth of clarify it little into is anticipated. a just headwind I there so fair? in

to we our that be our to below at growth. So remains least I though, a on bit call little the fact think that. explicitly And outlook the expect and about year-end talked QX X% be continues case I

be had line So with I and about. to outlook continue progress think, what our talked in we

adjusted profit at X see adjusted be expense your say gross trajectory next versus may profit over should three be the in and expect growth quarters? growth. But year when gross Slides like look what as less year meaningfully X is But opex we at growth, similar on to adjusted we operating the should we look

case per about solid per gross as case. be continues talked profit opex gross So we've and to in

as to we'll So we expect get better as on. continue goes the year

And I to one then just wanted thing. clarify

on guess, to addition You that? supply new chief Gent. in a Ty or I just chain role that just a to out hire, little Is for check, Is called that, new I wanted is just color want that officer. a

we've in about of the a be be year and Ty less little of ago, will next fulfilled that be field getting two. or as Company of starts No. And than and kind that, just the the for months may oriented chair week left He and Tim in July. he'll a so a couple role. in

Okay. And working me. question color the then elaborate just for last you delta on XQ that last on? Anymore -- could capital in

payable. accounts comes thing back timing-related related the it a nothing. over course don't There's year. mostly believe some the really We to of It's Sure.

So really cash XXXX, meaningfully if compared the compared flow it. to still stronger that's about operating and overall look you QX back to

We flow continue the to operating this about cash feel generate that good year. we'll very strength

of of from Stanley. Vincent please ahead. Sinisi The comes next go the Vincent, line question Morgan

to solid nice in just here. growth. Very back second independent XQ. the quarter go Obviously, for Wanted a to very

wondering was of weather, there see things types mentioned was One consistent I variability course, or lot did you've of or the customers either of though, strength pretty topic yesterday. any geographies? which don't particular was, of a in you a Just think

growth or that Just if in played independent wondering well? as case overall at all either to

touch Dirk. this can was had in When at just Vinnie, But you pretty is it the vortex negligible quarter. on Pietro example, Maybe us, look for weather widespread. this as impact and the broadly. year, what an year weather some the talk the last -- more I'll had polar

net overall, minimal. pretty was So the impact

we Vinnie, talked it doing more four had said if sales And lot upgrading growing more while range and consistency, drive number of ago, remember as the of in of be we a restaurants terms will in more questions, force. We talent, tools. you a the we discipline, in really year from a that to about performance, when just six our independent driving

And lowest and of the fact, Kelly's as at the in look performers see disparity that at starting range. starting see consistent. what external best question that's really of pretty has to environment when narrowing you're the performers to been between in outset geographies, because so the And we terms a per we're the

encouraging. That's Okay.

Okay, cool. of picture. part And then, not just that now the quickly course, sort of nice to hear, of exits fully customer the are

that to you're I centralized starting the the replenishment, guys know some see past. on benefits you earlier there of said impacts that Just

any Or in left Just since last now could quarter of it of been it a be, are the Are starting of you guys wondering benefit and has, over of or about it impact road? that feel a the is greatest of that? just I we an quarters. having couple down kind do don't now? two we like the impact course, kind should or of How seeing bit that like full-motion know, though

Sure.

through it's we've we is about say while freight, I were some of seen would you benefits recall as of some going seen through talked I've times. few coming So challenges, what we've the it may even the

much pleased very we've so. consistent that and the the are point changing about us logistics environment adapt seen between that team to to execution more more We teamwork team and Pietro's with allowed replenishment

that I continue our purchasing, think we'll around to area in continued see of etc. whether improvement, overtime, optimization it's

to pieces So likely come. place and in more

John, line [Operator instructions] please The go of next JP from question Ivankoe ahead. of comes John Morgan. the

Yes.

clarification of bit a on think, that I you a earlier. said little things some First

versus teams the increases was attributable even realized the different And the 'XX? whether visibility? stability the is of think or terms of and case volume you different people to what than roles. assuming size yourself about more give directly to if of the obviously, XQ there's at even In actually we independent some 'XX selling that's we growth and add And whether volumes? case case, I'm can organizations, the more your point to that team-based that in I talk Can this

Einberger, of I'm So quarter, that we selling and of page that had the looking last at what we the in think sales had team-based investment the and really than been which motivated years, story the sales years used been several that's some force, last by operating the, ago. again, some Scott reduced have of in a benefits organization, support I that the invest, the four, an customer -- experience show to of again, segment drives more call, that five the size the

selling size long that it. terms story So the selling organization of consider should total the you organization terms been fairly short, has of flat in in of

We of the sales in look current function in route a it of investing market-by-market terms market geography opportunistically it's at think is -- we at and a looking the particular size. always what we In potential is force. are our what share and

an market very a are invest continue high in where decision. first That's So and have to where we will we the in Those share. we in order opportunity size gain sales geography-by-geography think the route a we have of grow force growing to share. much geographies to

And have with a that's on a we sales team process the regular basis.

updates That's app. number your adoption? of in your up that ahead in may at that coming? gap. helpful obviously initiative? has it the of a important for evolution could substantial drive kind are mean, of restaurants kind of app It's versions you And order talk I more the effectiveness about go anything evolutions the that in you're so context, leapfrog that XX% higher. your ordering terms lot next might mean, facing closed or competition, customers working taken customers? even high of the theory of like your we to the technology I independent you guess, of customer app, that you the some new Thank -- be there reasons haven't be color. you. Is but certainly that come any in are looking a And restaurant of could the the of this I of if have are some then to what Secondly, with further next, competition why independent could necessarily digital

So many to we I we that how guess, high have than XX%. to have high, is even and higher Look, number. TAMs many who close we're are start with markets

the to than ensure What terms from say higher, the We of some that the customers. or tools have force all and single rates. going at the our every process many happens keeps more one in range ongoing fully different would or It's in constraint higher. XX% our TAMs that the embraces sales is hurdle of I an

higher it but overtime, at So obviously to continuing a we see go decelerating rate.

tools. team-based areas: also on the customer mobile side adoption really facing focus lot our expand. the in investment to as we of to facing selling; mobile and of XX%. think, XX% enable enhancements terms And been services We're an In of the other growth customer sorry, improvements, said. some value-added to I that in terms the of or seeing has is I in to mobile of our two in -- kind great platform probably continue thirdly, year on one, CRM services value-added year of addition And

that we've So other experience invest functionality be at continue see services. platform entry increase. and platform CRM to opportunity value-add order just so or We'll hanging to seen we in elements could or the off summarize, are the that to -- either of

about about some I competition. something has or of apps you kind gap and major one the the preference or again? of And that platforms are first my question place do even your the guess, digital Foods have that of -- the Do app of that or there about is US has I mean, usability is relative you narrowed versus in allow considering way, you think a it can widen and it. concerned to is that relative you're

Right.

I them to sales what or drive a done ideas, prototyping which right now, the on And is platform, driving that's driving prioritizing of in the think our realm, CRM product thought, really job When I out in adoption. is growth. So a there's It's individual adoption and driving you point, services certain to we've is, adoption said, in respect quickly continuing of we're it's really run -- no at ideas. and list. sellers -- ideas learn long mean some what still driving like profitable good a with where John, have innovation. value-added shortage started good as art I I we're you that we And focus adoption, first of we're I helps just it --

thing other and would competitors. I The terms of in say comparison

So, to really hard one, it's apples-to-apples. measure

we exclude from example, EDI measurement. As an our

relative is, where said, handful our So regional, to lead it's other cash there thing a may are, of distributors. very lead narrowing, stand a have fragmented exactly compete to respect we and carry of to competitors local, and too we then, while there against incredibly always with as would be dramatic we it's to And compare we've I relative competitors suite the and And the hard industry. out then say still whole others. most other an

important set. with customers you competitor look still So an large a when at tiebreaker

time. [Operator you instructions] at continue. questions may Speakers, are further this no There

call I earlier our see and their All right, respect associates continued thank SGA the have continued today. Thanks, confidence thank and to to you, strategy associates to like questions results. the for everyone, commitment. and future joining results of way by of I'd our today our for against our opportunity progress well, on you for us with Hopefully, our your again.

may you call, concludes this And conference today's disconnect. now