US Foods acquires distributor, reports profit hike

Major United States food distributor US Foods has acquired All American Foods, a broadline distributor of seafood and other foods with annual sales of USD 60 million (EUR 56.6 million).

Rosemont, Illinois-based US Foods also reported higher net income and profits for fiscal year 2016, but realized a 4.3-percent drop in fourth-quarter sales. The company distributes food to more than 250,000 foodservice customers.

North Kingstown, Rhode Island-based All American Foods supplies fresh, frozen and canned seafood to around 1,000 foodservice customers in southern New England.

“The addition of All American Foods will further enhance US Food’s ability to serve customers in the Northeast region, an area of the country heavily populated with independent restaurants,” US Foods said in a statement.

All American Foods will continue to operate out of its 65,000-square-foot in North Kingstown. Terms of the acquisition were not disclosed.

Meanwhile, US Foods’ net sales declined 0.9 percent to USD 22.9 billion (EUR 21.6 billion) in fiscal year 2016, but its net income soared USD 42 million (EUR 39.6 million) to USD 210 million (EUR 198 million) for the year. Also, gross profit increased one percent to USD 4.1 billion (EUR 3.9 billion).

“In our first year as a public company, we grew volumes with independent restaurant customers well above market rates and expanded profit margins in a challenging, deflationary environment,” said CEO Pietro Satriano. “We also expanded both our broadline and specialty distribution capabilities through the successful integration of five acquisitions in the last year.”

However, in US Foods’ fiscal fourth quarter, net sales decreased 4.3 percent to USD 5.7 billion (EUR 5.4 billion), while net income grew USD 87 million (EUR 82 million) to USD 77 million (EUR 72.6 million), up from a loss the previous year.

For fiscal 2017, the company expects net sales growth of between one and three percent. However, US Foods expects first quarter adjusted EBITDA to be approximately two percent below the full year range, driven by weather, holiday timing and other factors.

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