The Chefs' Warehouse, Inc.

Greetings, and welcome to the Chef's Warehouse First Quarter 2024 Earnings Conference Call. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Alex Aldis, General Counsel, Corporate Secretary, and Chief Government Relations Officer. Please proceed.

Thank you, Operator. Good morning, everyone. With me on today's call are Chris Pappas, Founder, Chairman, and CEO, and Jim Letty, our CFO. By now, you should have access to our first quarter 2024 earnings press release. It can also be found at www.chefswarehouse.com under the investor relations section. Throughout this conference call, we will be presenting non-GAAP financial measures, including, among others, historical and estimated EBITDA and adjusted EBITDA, as well as both historical and estimated adjusted net income and adjusted earnings per share. These measurements are not calculated in accordance with GAAP. and may be calculated differently in similarly titled non-GAAP financial measures used by other companies. Quantitative reconciliations of our non-GAAP financial measures to their most directly comparable GAAP financial measures appear in today's press release. Before we begin our formal remarks, I need to remind everyone that part of our discussion today will include forward-looking statements, including statements regarding our estimated financial performance. Such forward-looking statements are not guarantees of future performance. and therefore you should not put undue reliance on them. These statements are subject to numerous risks and uncertainties that could cause actual results to differ materially from what we expect. Some of these risks are mentioned in today's release. Others are discussed in our annual report on Form 10-K and quarterly reports on Form 10-Q, which are available on the SEC website. Today we are going to provide a business update and go over our first quarter results in detail. Then we will open the call for questions. With that, I will turn the call over to Chris Pappas.

Chris? Thank you, Alex, and thank you all for joining our first quarter 2024 earnings call. First quarter 2024 business activity displayed typical seasonal cadence as revenue trends coming out of January increased steadily in February and March. Our business units, international and domestic, delivered strong new customer and placement growth during the first quarter and aggregate price inflation continued to trend in the low single digit range. I would like to thank all our Chef Warehouse teams for sales and operations to all the supporting functions for delivering a great start to 2024. As we head into the second quarter, and the rest of the year, I would also like to recognize our customer and supplier partners for their support and confidence in our people, diversity, and quality of products, and our high-touch, flexible distribution platform. A few highlights from the first quarter include 8.8% organic growth in net sales, especially Specialty sales were up 7% organically over the prior year, which was driven by unique customer growth of approximately 10.1%, placement growth of 12%, and specialty case growth of 4.6%. Organic pounds and center of the plate were approximately 6.2% higher than the prior year first quarter. Gross profit margins increased approximately 37 basis points. Gross margin in the specialty category was unchanged as compared to the first quarter of 2023, while gross margin in the center of the plague category increased 19 basis points year over year. Excluding the impact of hardies, specialty gross profit margins increased approximately 58 basis points versus the prior year quarter. Jim will provide more detail on gross profit and margins in a few minutes. As we move into the next phase of our growth, focused on harvesting the investments we have made the past few years, our teams are engaged in continual operational improvement processes across our domestic and international markets. These work streams include implementing technology-driven product selection and loading processes in our distribution centers, enhancements to our customer-facing digital platform, as well as our continued consolidation of operation and routes in key markets. A few highlights are, during the quarter, we completed the consolidation of our Foley Fresh seafood facility located in Boston into our new Bedford, Massachusetts operation. This move reduces overhead expenses and facilitates improved cross-sale opportunities with our specialty produce and Allen Brothers distribution platform in New England. In Northern California, our project to consolidate multiple protein processing and distribution operations into our new Richmond facility continues to progress. We anticipate initiating operations during the second quarter with the phased-in consolidation during the second half of 2024, and the first quarter of 2025. We expect to see the majority of operational and distribution efficiencies emerge starting in 2025. In Texas, the integration of Hardee's and our specialty operations continues to move forward. In addition to driving cross-sale opportunities and initiating improvements in operational efficiency, our teams are making progress on capacity optimization in Houston. We expect this will facilitate growth in specialty produce and protein cross-sale to customers in the greater Houston market, as well as reduce internal transfer costs going forward. These projects, while not all inclusive, are aimed at providing our teams with a continuous and ever-evolving platform for growth and operational efficiency within the unique business model that Chef's Warehouse provides to the thousands of artisan suppliers we represent and customers we serve. We are focused on continued organic growth and building on our brand as the premier marketer and distributor of specialty ingredients, produce, and value-add proteins in the region we operate. With that, I'll turn it over to Jim to discuss more detailed financial information for the quarter and an update on our liquidity. Jim? Thank you, Chris.