The Chefs' Warehouse, Inc.

Greetings, and welcome to the Chef Warehouse Third Quarter 2025 Earnings Conference Call. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Alex Aldos, General Counsel, Corporate Secretary, and Chief Government Relations Officer. Please go ahead, sir.

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 third quarter 2025 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 historical adjusted net income, adjusted earnings per share, adjusted operating expenses, adjusted operating expenses as a percentage of net sales and as a percentage of gross profit, net debt, net debt leverage, and free cash flow. These measures 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 and third quarter 2025 earnings presentation. 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 third quarter results in detail. For a portion of our discussion this morning, we will refer to a few slides posted on the Chef's Warehouse website under Investor Relations section titled Third Quarter 2025 Earnings Presentation. Please note that these slides are disclosed at this time for illustration purposes only. Then we will open up 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 Third Quarter 2025 Earnings Call. Business and demand trends improved sequentially through the third quarter, and momentum in demand and market share gains continued into October. Our operating divisions across domestic and international markets delivered strong growth in revenue and gross profit dollars, as well as continued progress, increasing relevance with our customer base with strong year-over-year growth in unique item placements. As we head into the busy holiday season, I would like to thank all our Chef's Warehouse teams, from sales and procurement operations to all the supporting functions for their dedication and commitment to delivering our diverse and high-quality product service in partnership with our suppliers and customers and the communities we serve. As a reminder, earlier in 2025, we eliminated two non-core programs in Texas that came with the acquisition of Hardee's in 2023. These programs, one protein program focused on high volume, low dollar poultry, and another produce processing and packaging program together only represented approximately 1% of our revenue. As such, Until we lap this attrition in the second quarter of 2026, we will present price and volume metrics as reported and also excluding the impact of these changes to present more representative year-over-year price inflation and volume changes for our business overall. With that, please refer to slide three of the presentation. A few highlights from the third quarter include 9.6% growth in net sales. Specialty sales were up 7.7% over prior year, which was driven primarily by unique placement growth of 5.3%, reported specialty case growth of 3.2%, and price inflation. Excluding the elimination of the Texas produce processing and packaging program, specialty case growth was 5.4% versus the prior year quarter. Unique customer growth, 2.6% year over year. Reported unique customer growth was impacted by the Texas commodity poultry attrition and the temporary impact of the heightened conflict in the Middle East during the summer months. Despite the temporary summer impact, our Chef's Middle East business continued to grow and exceed our expectation. Excluding these impacts, third quarter year-over-year unique customer growth was approximately 5.8%. Pounds and center of the plate were approximately 1.1% lower than the prior year third quarter. Excluding the attrition related to the Texas commodity poultry program, center of the plate pounds growth was 9.6% higher than prior year third quarter. Gross profit margins increased approximately seven basis points. Gross margins in the specialty category increased approximately 59 basis points as compared to the third quarter of 2024, while gross margin in the center of the plate category decreased approximately 49 basis points year over year. Jim will provide more detail on gross profit and margins in a few moments. Please refer to slide four for an update on certain of our operating metric improvements. In summary, chart one shows continued improvement in gross profit dollars per route. Third quarter 2025 trailing 12 months was 4% higher versus full year 2024 and 37.8% higher than 2019. Chart two shows third quarter 2025 trailing 12 month adjusted EBITDA per employee increased 9% versus full year 2024 and 28% versus 2019. Third quarter 2025 trailing 12-month adjusted operating expense as a percentage of gross profit dollars improvement by 114 basis points versus full year 2024 and 206 basis points versus 2019. Subsequent to the close of our fiscal third quarter, on October 1st, 2025, we completed the acquisition of Italico Food Products, a small specialty food and ingredient distributor located in Denver, Colorado. We are excited for the Italico team to join the Chef's Warehouse family of companies and brands. We look forward to leveraging our unique CW go-to-market and supply chain model as we grow into the dynamic urban and resort markets in the centennial estate. 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?