US Foods Holding Corp. (NYSE:USFD) Q4 2022 Earnings Call Transcript

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If there’s one thing, I think, I can help the team do is really focus on the critical view and get them done and do them well and then move on to the next pieces of it. So that’s purely what I meant. I’m working closely with the team around that now. Let’s work on the needle movers, the right ones as you heard Dirk say that help our business as well as our associates and keep moving ahead.

Edward Kelly: Okay. And then Dirk just a follow-up for you. Your guidance implies gross profit per case improving in 2023 versus 2024, but you also mentioned sequentially a little bit of deflation. I think, there’s been questions amongst investors about things like procurement gains and lapping those. So I think this is an important issue as we’re seeing this inflation. Can you maybe just talk a bit more about your confidence in growing gross profit per case next year and the drivers of that despite that backdrop?

Dirk Locascio: Sure. Good morning, Ed. So we do feel good about gross profit per case continuing to improve in 2023 above 2022. And I think that it comes back to what we’ve talked about is that the lion’s share of our gross profit per case improvement has been our own four-wall initiatives and the good work that our team has done and really making sure that we’re passing those through and reflecting even with customers where we’ve optimized some pricing reflecting the higher cost operating environment that we’re operating in. So we expect it to be pretty durable. Yes, early in the year we’ll have some portions of onetime kind of procurement gains that we’ll be lapping. But our team through all the good work last year that we’ve done we feel very good about continuing to have strong gross profit and we think it will be a good durable gross profit as we look ahead.

Edward Kelly: Great. Thanks, guys.

Dirk Locascio: Thanks, Ed.

Dave Flitman: Thanks, Ed.

Operator: Your next question is from Lauren Silberman of Credit Suisse. Please go ahead. Your line is open.

Lauren Silberman: Thank you very much and I also echo my congrats, Dave. And this is a little bit of a follow-up to a prior question on 2024. But I know it’s still early days. How are you thinking about the level of incremental investments that might be necessary as you look to execute the plan and then add your own, kind of, spin on the plan?

Dave Flitman: Yes, you’re right Lauren. It would be premature for me to really think about those investments. Now I think the company is making the right investments. You heard us talk about the things that we’re doing in supply chain most of which requires some level of investment. The excitement we have around the sales team and making the appropriate targeted investments there opening of the CHEF’STORES I think we’ll continue on the plan that we’ve had. And then I’ll be assessing here over the next few months what I think it’s going to take beyond 2023 into 2024 and beyond.

Lauren Silberman: Thank you for that. And then just on near-term, are you guys willing to provide any additional color on what you’re seeing quarter-to-date? I know broadly the industry is seeing some improvement — some of it’s Omicron just trying to understand the underlying trends? Thank you.

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