Performance Food Reports Mixed Results and Furloughs or Cuts 3,500 Staff

Performance Food fiscal-third-quarter adjusted profit beat estimates, revenue missed forecasts, and the company furloughed or cut 3,500 staff.
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Shares of Performance Food Group  (PFGC) - Get Report were higher Monday after the consumer foods company reported mixed third-quarter results and furloughed or cut 3,500 positions.

The company reported adjusted earnings of 58 cents a share, while analysts surveyed by FactSet were looking for 22 cents. Revenue rose 49% to $7 billion against the estimate of $7.11 billion. 

"The covid-19 pandemic has brought unique challenges to our industry and company," George Holm, PFG’s chairman, president and chief executive, said in a statement.

Performance Food also said that it had "furloughed or eliminated" a total of 3,500 positions across the organization.

Senior management had 25% of their compensation deferred while 25% of the board's cash fees for the period April 6 through Dec. 31 was also deferred. 

The company also said it had raised additional capital in both equity and debt markets to fortify its balance sheet.

On March 23, Performance Food said it was canceling the $250 million share repurchase plan that it initiated in November 2018. The plan had about $235.7 million available in it for share buybacks. 

The company also drew $400 million from the new $3 billion credit facility.

On March 19, PFG withdrew its guidance for fiscal 2020 in the wake of the coronavirus pandemic and the deteriorating macroeconomic environment. 

"While there are still challenges in the days ahead, we are encouraged that since the beginning of the covid-19 pandemic, the week of March 22 has represented the low point in our weekly sales level," Holm said. 

At last check Performance Food shares were 4% higher near $28.