US Foods withdraws earnings guidance, starts cost-cutting amid COVID-19
Foodservice distriubutor outlines steps, including hiring freeze
Like many other foodservice companies, US Foods has withdrawn its earnings guidance for 2020. The company also indicated it had undertaken a cost reduction program to mitigate the impact of COVID-19 on its operations. As a downturn in business due to voluntary and mandated restaurant closures continues to ripple across the restaurant industry, suppliers and distributors are pulled in.
The nation’s third-largest breadline foodservice distributor by revenue also announced it will more strictly manage its working capital, eliminate all non-critical capital spend, temporarily furlough associates based on demand, freeze hiring and defer wage increases. In addition, US Foods will defer board compensation.
Company executives suggested business from high-demand clients, including food retailers, could help offset some of the declines experienced from restaurants. Also, US Foods will continue to work with the healthcare industry and armed forces, supporting them as they support communities across the United States.
US Foods has developed tools and resources, which it says will help restaurants through a difficult time. “While the full business impact of COVID-19 is not yet known, we are taking immediate action to reduce our costs to match the slowdown we’re seeing in restaurant, hospitality and education case volume,” said Pietro Satriano, chairman and chief executive.
Photo credit: US Foods
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