NYSE:PFGC
Performance Food Group Co
A premier US-based food distributor powering restaurant and retail supply chains with a robust network delivering fresh and packaged goods nationwide.
Key Metrics
Investment Thesis
Bull Case
Investors may favor PFGC for its resilient market position as demand for food distribution remains inelastic regardless of economic cycles. The company's ability to expand private label offerings and optimize its logistics network can help restore margins if input costs stabilize. A potential decline in debt levels or interest rate cuts could unlock significant value given the $5.39B long-term debt load.
Bear Case
The sharp drop in net profit from $435.9M in 2024 to $340.2M in 2025 raises concerns about profitability sustainability amidst rising operational expenses. High leverage with $13.41B in total liabilities against only $4.47B in shareholders' equity limits the company's flexibility during downturns. Significant goodwill of $3.48B exposes the stock to impairment risks if regional market conditions deteriorate.
About Performance Food Group Co
Performance Food Group Co (PFGC) is a leading North American food distributor serving restaurants, grocery retailers, and convenience stores. The company delivers fresh produce, dry goods, proteins, and private label products through its extensive regional network. Operating primarily in the United States, PFGC supports both independent businesses and major chains with comprehensive supply chain solutions.
Analysis
Management Discussion
While revenue grew to $63.30B in 2025, net income declined to $340.2M, suggesting margin compression likely due to elevated operating costs or higher interest expenses on debt. The company maintains a healthy current ratio of roughly 1.58 and generated positive operating profit of $816.3M, indicating underlying operational strength despite the drop in bottom-line earnings.
Industry Overview
The US food distribution industry is highly fragmented but trending toward consolidation as companies seek scale to negotiate better terms with suppliers and retailers. Success depends on managing perishable inventory efficiently and adapting quickly to changing consumer preferences toward health-conscious and sustainable options.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Revenue | $57.25B | $58.28B | $63.30B |
| Cost of Revenue | $51.00B | $51.70B | $55.88B |
| Gross Profit | $6.25B | $6.58B | $7.42B |
| Operating Expenses | $5.49B | $5.75B | $6.60B |
| Operating Income | $765.8M | $826.4M | $816.3M |
| Stock-Based Comp | $43.4M | $41.9M | — |
| D&A | $496.7M | $556.7M | — |
| Depreciation | $315.7M | $355.2M | — |
| Amortization | $181.0M | $201.5M | — |
| Non-Operating Income | $-221.8M | $-229.6M | $-357.5M |
| Interest Expense | $218.0M | $232.2M | $358.4M |
| Pre-Tax Income | $544.0M | $596.8M | $458.8M |
| Income Tax | $146.8M | $160.9M | $118.6M |
| Continuing Ops | $397.2M | $435.9M | $340.2M |
| Discontinued Ops | $0 | $0 | $0 |
| Net Income | $397.2M | $435.9M | $340.2M |
| Minority Interest | $0 | $0 | $0 |
| Net to Common | $397.2M | $435.9M | $340.2M |
| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Current Assets | $6.07B | $6.15B | $7.14B |
| Accounts Receivable | $2.40B | $2.48B | $2.83B |
| Inventory | $3.39B | $3.31B | $3.89B |
| Prepaid Expenses | $227.8M | $268.1M | $239.7M |
| Other Current Assets | $54.4M | $91.6M | $174.7M |
| Long-Term Assets | $6.43B | $7.24B | $10.75B |
| PP&E (Net) | $2.26B | $2.79B | $4.46B |
| Intangibles | $1.03B | $971.1M | $1.69B |
| Goodwill | $2.30B | $2.42B | $3.48B |
| Operating Leases | $703.6M | $875.5M | $933.8M |
| Other LT Assets | $130.5M | $186.2M | $185.0M |
| Total Assets | $12.50B | $13.39B | $17.88B |
| Current Liabilities | $3.55B | $3.76B | $4.52B |
| Current Debt | $0 | $0 | $0 |
| Current Leases | $105.5M | $108.2M | $104.5M |
| Other Current Liab | $3.45B | $3.65B | $4.41B |
| Long-Term Liabilities | $5.20B | $5.51B | $8.89B |
| Long-Term Debt | $3.46B | $3.20B | $5.39B |
| LT Operating Leases | $628.9M | $819.3M | $900.7M |
| Other LT Liab | $1.11B | $1.49B | $2.60B |
| Total Liabilities | $8.75B | $9.27B | $13.41B |
| Shareholders' Equity | $3.75B | $4.13B | $4.47B |
| Retained Earnings | $867.0M | $1.30B | $1.64B |
| AOCI | $14.0M | $4.0M | $-3.2M |
| Total L&E | $12.50B | $13.39B | $17.88B |
| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Net Income (CFO) | $397.2M | $435.9M | — |
| Non-Cash Adjustments | $354.2M | $486.2M | — |
| Working Capital Changes | $80.7M | $240.9M | — |
| Cash from Operations | $832.1M | $1.16B | — |
| Capital Expenditures | $269.7M | $395.6M | — |
| Cash from Investing | $-294.6M | $-682.7M | — |
| Share Buybacks | $11.2M | $78.1M | — |
| Cash from Financing | $-536.2M | $-472.6M | — |
| FX Effect | $0 | $0 | $0 |
| Net Change in Cash | $1.3M | $7.7M | — |
| Beginning Cash | $18.7M | $20.0M | — |
| Ending Cash | $20.0M | $27.7M | — |
Frequently Asked Questions
How does Performance Food Group Co make money?
The company's revenue is driven by four primary segments: Food Service Distribution (serving restaurants and institutions), Retail Distribution (supplying grocery stores), Convenience Store Distribution, and Wholesale Club operations. These segments collectively manage the full spectrum of perishable and non-perishable food products from farm to fork.
What are the main risks for PFGC?
Volatility in input costs for commodities like dairy, meat, and produce can significantly impact gross margins despite scale. Rising interest rates increase the cost of servicing substantial long-term debt obligations totaling over $5 billion. Supply chain disruptions or weather events affecting agricultural yields could threaten inventory availability and pricing power.
What is PFGC's competitive advantage?
PFGC leverages an unmatched regional footprint with over 30 locations providing superior local market responsiveness compared to national giants. Its deep relationships with independent restaurant owners and retailers create high switching costs, while its private label brands offer strong margin opportunities in a commoditized industry.
Related Companies
Not financial advice. All content is for informational purposes only. Data may contain errors. Consult a qualified financial advisor before making investment decisions.