Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Jun. 30, 2018 | Aug. 06, 2018 | Dec. 29, 2017 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Jun. 30, 2018 | ||
Document Fiscal Year Focus | 2,018 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | PFGC | ||
Entity Registrant Name | Performance Food Group Company | ||
Entity Central Index Key | 1,618,673 | ||
Current Fiscal Year End Date | --06-30 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 104,735,605 | ||
Entity Public Float | $ 2,846,661,169 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Jun. 30, 2018 | Jul. 01, 2017 |
Current assets: | ||
Cash | $ 7.5 | $ 8.1 |
Accounts receivable, less allowances of $19.3 and $17.0 | 1,065.6 | 1,028.5 |
Inventories, net | 1,051.9 | 1,013.3 |
Prepaid expenses and other current assets | 78.5 | 35 |
Total current assets | 2,203.5 | 2,084.9 |
Goodwill | 740.5 | 718.6 |
Other intangible assets, net | 193.8 | 201.1 |
Property, plant and equipment, net | 795.5 | 740.7 |
Restricted cash | 10.3 | 12.9 |
Other assets | 57.3 | 45.9 |
Total assets | 4,000.9 | 3,804.1 |
Current liabilities: | ||
Outstanding checks in excess of deposits | 260.8 | 218.2 |
Trade accounts payable | 973 | 907.1 |
Accrued expenses and other current liabilities | 227.8 | 246.3 |
Long-term debt—current installments | 5.8 | |
Capital lease obligations—current installments | 8.4 | 5.9 |
Total current liabilities | 1,470 | 1,383.3 |
Long-term debt | 1,123 | 1,241.9 |
Deferred income tax liability, net | 106.3 | 103 |
Capital lease obligations, excluding current installments | 52.8 | 44 |
Other long-term liabilities | 113.5 | 106.4 |
Total liabilities | 2,865.6 | 2,878.6 |
Commitments and contingencies (Note 15) | ||
Shareholders’ equity: | ||
Common Stock: $0.01 par value per share, 1.0 billion shares authorized, 103.2 million shares issued and outstanding as of June 30, 2018; 1.0 billion shares authorized, 100.8 million shares issued and outstanding as of July 1, 2017 | 1 | 1 |
Additional paid-in capital | 861.2 | 855.5 |
Accumulated other comprehensive income, net of tax expense of $2.9 and $1.5 | 8.3 | 2.4 |
Retained earnings | 264.8 | 66.6 |
Total shareholders’ equity | 1,135.3 | 925.5 |
Total liabilities and shareholders’ equity | $ 4,000.9 | $ 3,804.1 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Jun. 30, 2018 | Jul. 01, 2017 |
Statement Of Financial Position [Abstract] | ||
Accounts receivable, allowances | $ 19.3 | $ 17 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued | 103,200,000 | 100,800,000 |
Common stock, shares outstanding | 103,200,000 | 100,800,000 |
Accumulated other comprehensive income, tax expense | $ 2.9 | $ 1.5 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Millions, $ in Millions | 12 Months Ended | ||||
Jun. 30, 2018 | Jul. 01, 2017 | Jul. 02, 2016 | |||
Income Statement [Abstract] | |||||
Net sales | $ 17,619.9 | $ 16,761.8 | $ 16,104.8 | ||
Cost of goods sold | 15,327.1 | 14,637 | 14,094.8 | ||
Gross profit | 2,292.8 | 2,124.8 | 2,010 | ||
Operating expenses | 2,039.3 | 1,913.8 | 1,807.8 | ||
Operating profit | 253.5 | 211 | 202.2 | ||
Other expense, net: | |||||
Interest expense | 60.4 | 54.9 | 83.9 | ||
Other, net | (0.5) | (1.6) | 3.8 | ||
Other expense, net | 59.9 | 53.3 | 87.7 | ||
Income before taxes | 193.6 | 157.7 | 114.5 | ||
Income tax (benefit) expense | (5.1) | 61.4 | 46.2 | ||
Net income | $ 198.7 | $ 96.3 | [1] | $ 68.3 | [1] |
Weighted-average common shares outstanding: | |||||
Basic | 102 | 100.2 | 96.4 | ||
Diluted | 104.6 | 103 | 98.1 | ||
Earnings per common share: | |||||
Basic | $ 1.95 | $ 0.96 | $ 0.71 | ||
Diluted | $ 1.90 | $ 0.93 | $ 0.70 | ||
[1] | The consolidated statements of cash flows for the fiscal years ended July 1, 2017 and July 2, 2016 have been adjusted to reflect the adoption of ASU 2016-08, Statement of Cash Flows (Topic 230): Restricted Cash. The consolidated statements of cash flows explain the change during the periods in the total of cash and restricted cash. Therefore, restricted cash activity is included with cash when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. Cash payments of $7.3 million in fiscal 2016 related to insurance claims paid using restricted cash is classified as a change in Accrued expenses and other liabilities within Net cash provided by operating activities. Refer to Note 3 for further discussion. |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Millions | 12 Months Ended | ||||
Jun. 30, 2018 | Jul. 01, 2017 | Jul. 02, 2016 | |||
Statement Of Income And Comprehensive Income [Abstract] | |||||
Net income | $ 198.7 | $ 96.3 | [1] | $ 68.3 | [1] |
Interest rate swaps: | |||||
Change in fair value, net of tax | 5.8 | 5.7 | (5.7) | ||
Reclassification adjustment, net of tax | (0.4) | 2.5 | 4.4 | ||
Other comprehensive income (loss) | 5.4 | 8.2 | (1.3) | ||
Total comprehensive income | $ 204.1 | $ 104.5 | $ 67 | ||
[1] | The consolidated statements of cash flows for the fiscal years ended July 1, 2017 and July 2, 2016 have been adjusted to reflect the adoption of ASU 2016-08, Statement of Cash Flows (Topic 230): Restricted Cash. The consolidated statements of cash flows explain the change during the periods in the total of cash and restricted cash. Therefore, restricted cash activity is included with cash when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. Cash payments of $7.3 million in fiscal 2016 related to insurance claims paid using restricted cash is classified as a change in Accrued expenses and other liabilities within Net cash provided by operating activities. Refer to Note 3 for further discussion. |
Consolidated Statements of Shar
Consolidated Statements of Shareholders' Equity - USD ($) $ in Millions | Total | Common Stock Class A [Member] | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Accumulated (Deficit) Earnings [Member] | ||
Balance Beginning at Jun. 27, 2015 | $ 493 | $ 0.9 | $ 594.1 | $ (4.5) | $ (97.5) | |||
Balance Beginning, shares at Jun. 27, 2015 | 86.9 | |||||||
Issuance of common stock under stock-based compensation plans | 0.4 | 0.4 | ||||||
Issuance of common stock under stock-based compensation plans, shares | 0.2 | |||||||
Reclassification of Class A and Class B common stock into a single class | $ (0.9) | $ 0.9 | ||||||
Reclassification of Class A and Class B common stock into a single class, shares | (86.9) | 86.9 | ||||||
Issuance of common stock in initial public offering, net of underwriter commissions and offering costs | 223.6 | $ 0.1 | 223.5 | |||||
Issuance of common stock in initial public offering, net of underwriter commissions and offering costs, shares | 12.8 | |||||||
Tax benefit from exercise of stock options | 1.6 | 1.6 | ||||||
Net income | 68.3 | [1] | 68.3 | |||||
Interest rate swaps | (1.3) | (1.3) | ||||||
Stock-based compensation expense | 17.2 | 17.2 | ||||||
Balance Ending at Jul. 02, 2016 | 802.8 | $ 1 | 836.8 | (5.8) | (29.2) | |||
Balance Ending, shares at Jul. 02, 2016 | 99.9 | |||||||
Issuance of common stock under stock-based compensation plans | 0.5 | 0.5 | ||||||
Issuance of common stock under stock-based compensation plans, shares | 0.9 | |||||||
Net income | 96.3 | [1] | 96.3 | |||||
Interest rate swaps | 8.2 | 8.2 | ||||||
Stock-based compensation expense | 17.3 | 17.3 | ||||||
Change in accounting principle | [2] | 0.4 | 0.9 | (0.5) | ||||
Balance Ending at Jul. 01, 2017 | $ 925.5 | $ 1 | 855.5 | 2.4 | 66.6 | |||
Balance Ending, shares at Jul. 01, 2017 | 100,800,000 | 100.8 | ||||||
Issuance of common stock under stock-based compensation plans | $ (15.9) | (15.9) | ||||||
Issuance of common stock under stock-based compensation plans, shares | 2.4 | |||||||
Net income | 198.7 | 198.7 | ||||||
Interest rate swaps | 5.4 | 5.4 | ||||||
Stock-based compensation expense | 21.6 | 21.6 | ||||||
Change in accounting principle | [3] | 0.5 | (0.5) | |||||
Balance Ending at Jun. 30, 2018 | $ 1,135.3 | $ 1 | $ 861.2 | $ 8.3 | $ 264.8 | |||
Balance Ending, shares at Jun. 30, 2018 | 103,200,000 | 103.2 | ||||||
[1] | The consolidated statements of cash flows for the fiscal years ended July 1, 2017 and July 2, 2016 have been adjusted to reflect the adoption of ASU 2016-08, Statement of Cash Flows (Topic 230): Restricted Cash. The consolidated statements of cash flows explain the change during the periods in the total of cash and restricted cash. Therefore, restricted cash activity is included with cash when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. Cash payments of $7.3 million in fiscal 2016 related to insurance claims paid using restricted cash is classified as a change in Accrued expenses and other liabilities within Net cash provided by operating activities. Refer to Note 3 for further discussion. | |||||||
[2] | As of the beginning of fiscal 2017, the Company elected to early adopt the provisions of ASU 2016-09, Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. The Company has made a policy election to account for forfeitures as they occur and recorded a cumulative-effect adjustment to Accumulated Deficit as of the date of adoption. | |||||||
[3] | In the fourth quarter of fiscal 2018, the Company elected to early adopt ASU 2018-02, Income Statement—Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. The Company reclassified the stranded tax effects resulting from the Tax Cuts and Jobs Act (the “Act”) from accumulated other comprehensive income to retrained earnings. Refer to Note 3. Recently Issued Accounting Pronouncements for further discussion of the adoption of ASU 2018-02. |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 12 Months Ended | |||||
Jun. 30, 2018 | Jul. 01, 2017 | Jul. 02, 2016 | ||||
Cash flows from operating activities: | ||||||
Net income | $ 198.7 | $ 96.3 | [1] | $ 68.3 | [1] | |
Adjustments to reconcile net income to net cash provided by operating activities | ||||||
Depreciation | 100.3 | 91.5 | [1] | 80.5 | [1] | |
Amortization of intangible assets | 29.8 | 34.6 | [1] | 38.1 | [1] | |
Amortization of deferred financing costs and other | 4.6 | 4.5 | [1] | 20.6 | [1] | |
Provision for losses on accounts receivables | 12.1 | 6 | [1] | 7.5 | [1] | |
Expense related to modification and extinguishment of debt | [1] | 0.1 | 4.6 | |||
Stock compensation expense | 21.6 | 17.3 | [1] | 17.2 | [1] | |
Deferred income tax expense (benefit) | 1.4 | 6.3 | [1] | (0.4) | [1] | |
Change in fair value of derivative assets and liabilities | (0.2) | (1.8) | [1] | (0.8) | [1] | |
Other | 8.5 | (1.1) | [1] | 1.5 | [1] | |
Changes in operating assets and liabilities, net | ||||||
Accounts receivable | (33.9) | (35.7) | [1] | (1.2) | [1] | |
Inventories | (21.8) | (63.8) | [1] | (29.6) | [1] | |
Prepaid expenses and other assets | (44.3) | 10.3 | [1] | (34.9) | [1] | |
Trade accounts payable | 57.1 | (23.2) | [1] | 17.8 | [1] | |
Outstanding checks in excess of deposits | 42.6 | 57.8 | [1] | 31.7 | [1] | |
Accrued expenses and other liabilities | (9.5) | 2.6 | [1] | 7.6 | [1] | |
Net cash provided by operating activities | 367 | 201.7 | [1] | 228.5 | [1] | |
Cash flows from investing activities: | ||||||
Purchases of property, plant and equipment | (140.1) | (140.2) | [1] | (119.7) | [1] | |
Net cash paid for acquisitions | (71.1) | (192.9) | [1] | (39) | [1] | |
Proceeds from sale of property, plant and equipment | 1.8 | 1.1 | [1] | 1.1 | [1] | |
Net cash used in investing activities | (209.4) | (332) | [1] | (157.6) | [1] | |
Cash flows from financing activities: | ||||||
Net (payments) borrowings under ABL Facility | (119.8) | 134.9 | [1] | 99.3 | [1] | |
Payments on Promissory Note | (6) | |||||
Payments on Term Facility | [1] | (736.9) | ||||
Borrowings on Notes | [1] | 350 | ||||
Payments on financed property, plant and equipment | (1.9) | (1) | [1] | |||
Net proceeds from initial public offering | [1] | 226.4 | ||||
Cash paid for debt issuance, extinguishment and modifications | (1.3) | (0.2) | [1] | (13.9) | [1] | |
Cash paid for acquisitions | (9) | (1.3) | [1] | |||
Payments under capital and finance lease obligations | (6.9) | (5.4) | [1] | (3.4) | [1] | |
Proceeds from exercise of stock options | 12.3 | 4 | [1] | 1.3 | [1] | |
Tax benefits from exercise of equity awards | [1] | 1.6 | ||||
Cash paid for shares withheld to cover taxes | (28.2) | (3.5) | [1] | (0.9) | [1] | |
Net cash (used in) provided by financing activities | (160.8) | 127.5 | [1] | (76.5) | [1] | |
Net decrease in cash and restricted cash | (3.2) | (2.8) | [1] | (5.6) | [1] | |
Cash and restricted cash, beginning of period | [1] | 21 | 23.8 | 29.4 | ||
Cash and restricted cash, end of period | 17.8 | 21 | [1] | 23.8 | [1] | |
Debt assumed through capital lease obligations | 18.2 | 23.4 | 0.1 | |||
Disposal of property, plant and equipment under sale-leaseback transaction | 3.2 | |||||
Purchases of property, plant and equipment, financed | 4.2 | 0.5 | 1 | |||
Purchases of property, plant and equipment, accrued | 4 | 3.8 | ||||
Interest | 57.5 | 51.1 | 69.4 | |||
Income taxes, net of refunds | $ 33.3 | $ 45.7 | $ 56.8 | |||
[1] | The consolidated statements of cash flows for the fiscal years ended July 1, 2017 and July 2, 2016 have been adjusted to reflect the adoption of ASU 2016-08, Statement of Cash Flows (Topic 230): Restricted Cash. The consolidated statements of cash flows explain the change during the periods in the total of cash and restricted cash. Therefore, restricted cash activity is included with cash when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. Cash payments of $7.3 million in fiscal 2016 related to insurance claims paid using restricted cash is classified as a change in Accrued expenses and other liabilities within Net cash provided by operating activities. Refer to Note 3 for further discussion. |
Consolidated Statements of Cas8
Consolidated Statements of Cash Flows (Parenthetical) $ in Millions | 12 Months Ended |
Jul. 02, 2016USD ($) | |
Accounting Standards Update 2016-18 [Member] | Adjustments for New Accounting Principle, Early Adoption [Member] | |
Insurance claims paid using restricted cash | $ 7.3 |
Consolidated Statements of Cas9
Consolidated Statements of Cash Flows (Reconciliation) - USD ($) $ in Millions | Jun. 30, 2018 | Jul. 01, 2017 | ||
Statement Of Cash Flows [Abstract] | ||||
Cash | $ 7.5 | $ 8.1 | ||
Restricted cash(2) | [1] | 10.3 | 12.9 | |
Total cash and restricted cash | $ 17.8 | $ 21 | [2] | |
[1] | Restricted cash represents the amounts required by insurers to collateralize a part of the deductibles for the Company’s workers’ compensation and liability claims. | |||
[2] | The consolidated statements of cash flows for the fiscal years ended July 1, 2017 and July 2, 2016 have been adjusted to reflect the adoption of ASU 2016-08, Statement of Cash Flows (Topic 230): Restricted Cash. The consolidated statements of cash flows explain the change during the periods in the total of cash and restricted cash. Therefore, restricted cash activity is included with cash when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. Cash payments of $7.3 million in fiscal 2016 related to insurance claims paid using restricted cash is classified as a change in Accrued expenses and other liabilities within Net cash provided by operating activities. Refer to Note 3 for further discussion. |
Summary of Business Activities
Summary of Business Activities | 12 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Summary of Business Activities | 1. Business Overview Performance Food Group Company (the “Company”), through its subsidiaries, markets and distributes national and company-branded food and food-related products to customer locations across the United States. The Company serves both of the major customer types in the restaurant industry: (i) independent, or “Street” customers, and (ii) multi-unit, or “Chain” customers, which include regional and national family and casual dining restaurant chains, fast casual chains, and quick-service restaurants. The Company also serves schools, healthcare facilities, business and industry locations, and other institutional customers. Fiscal Years The Company’s fiscal year ends on the Saturday nearest to June 30 th Initial Public Offering On October 6, 2015, the Company completed a registered initial public offering (“IPO”) of 16,675,000 shares of common stock for a cash offering price of $19.00 per share ($17.955 per share net of underwriting discounts), including the exercise in full by underwriters of their option to purchase additional shares. The Company sold an aggregate of 12,777,325 shares of such common stock and certain selling stockholders sold 3,897,675 shares (including the shares sold pursuant to the underwriters’ option to purchase additional shares). The Company’s common stock is listed on the New York Stock Exchange under the ticker symbol “PFGC.” The aggregate offering price of the amount of newly issued common stock sold was $242.8 million. In connection with the offering, the Company paid the underwriters a discount of $1.045 per share, for a total underwriting discount of $13.4 million. In addition, the Company incurred direct offering expenses consisting of legal, accounting, and printing costs of $5.8 million in connection with the IPO, of which $3.0 million was paid during fiscal 2016. The Company used the net offering proceeds of the IPO, after deducting the underwriting discount and direct offering expenses, to repay $223.0 million aggregate principal amount of indebtedness under a credit agreement providing for a term loan facility (the “Term Facility”). The Company used the remainder of the net proceeds for general corporate purposes. Secondary Offerings On May 24, 2016, certain selling stockholders of the Company sold 12,000,000 shares of the Company’s common stock at a public offering price of $24.25 per share in a secondary public offering (the “Offering”). The selling stockholders granted the underwriters of the Offering an option to purchase an additional 1,800,000 shares at a price of $23.3406 per share. The underwriters exercised their option in full and, on May 27, 2016, purchased an additional 1,800,000 shares from the selling stockholders. The selling stockholders received all of the net proceeds from the Offering and the sale of the additional 1,800,000 shares. No shares were sold by the Company. In November 2016, January 2017, February 2017, and May 2017 certain selling stockholders sold an aggregate of 47,592,206 shares of the Company’s common stock in transactions registered under the Securities Act. The Company did not receive any proceeds from these sales. As a result of these sales, The Blackstone Group L.P. (“Blackstone”) no longer beneficially owns any shares of the Company’s common stock. In September 2017, November 2017 and December 2017 Wellspring Capital Management (“Wellspring”) sold an aggregate of 16,272,914 shares of the Company’s common stock in transactions registered under the Securities Act. The Company did not receive any proceeds from these sales. As a result of these sales, Wellspring no longer beneficially owns any shares of the Company’s common stock. |
Summary of Significant Accounti
Summary of Significant Accounting Policies and Estimates | 12 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies and Estimates | 2. Principles of Consolidation The consolidated financial statements include the accounts of the Company and its subsidiaries. All inter-company balances and transactions have been eliminated. Use of Estimates The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. The most significant estimates used by management are related to the accounting for the allowance for doubtful accounts, reserve for inventories, impairment testing of goodwill and other intangible assets, acquisition accounting, reserves for claims and recoveries under insurance programs, vendor rebates and other promotional incentives, bonus accruals, depreciation, amortization, determination of useful lives of tangible and intangible assets, and income taxes. Actual results could differ from these estimates. Cash The Company maintains its cash primarily in institutions insured by the Federal Deposit Insurance Corporation (“FDIC”). At times, the Company’s cash balance may be in amounts that exceed the FDIC insurance limits. Restricted Cash The Company is required by its insurers to collateralize a part of the deductibles for its workers’ compensation and liability claims. The Company has chosen to satisfy these collateral requirements primarily by depositing funds in trusts or by issuing letters of credit. All amounts in restricted cash at June 30, 2018 and July 1, 2017 represent funds deposited in insurance trusts, and $10.3 Accounts Receivable Accounts receivable are comprised of trade receivables from customers in the ordinary course of business, are recorded at the invoiced amount, and primarily do not bear interest. Accounts receivable also includes other receivables primarily related to various rebate and promotional incentives with the Company’s suppliers. Receivables are recorded net of the allowance for doubtful accounts on the accompanying consolidated balance sheets. The Company evaluates the collectability of its accounts receivable based on a combination of factors. The Company regularly analyzes its significant customer accounts, and when it becomes aware of a specific customer’s inability to meet its financial obligations to the Company, such as bankruptcy filings or deterioration in the customer’s operating results or financial position, the Company records a specific reserve for bad debt to reduce the related receivable to the amount it reasonably believes is collectible. The Company also records reserves for bad debt for other customers based on a variety of factors, including the length of time the receivables are past due, macroeconomic considerations, and historical experience. If circumstances related to specific customers change, the Company’s estimates of the recoverability of receivables could be further adjusted. As of June 30, 2018 and July 1, 2017, the allowance for doubtful accounts related to trade receivables was approximately $11.5 million and $11.0 million, respectively, and $7.8 million and $6.0 million, respectively related to other receivables. The Company recorded $12.1 million, $6.0 million, and $7.5 million in provision for doubtful accounts in fiscal 2018, fiscal 2017, and fiscal 2016, respectively. Inventories The Company’s inventories consist primarily of food and non-food products. The Company values inventories primarily at the lower of cost or market using the first-in, first-out (“FIFO”) method. At June 30, 2018, the Company’s inventory balance of $1,051.9 million consists primarily of finished goods, $954.8 million of which was valued at FIFO. As of June 30, 2018, $97.1 million of the inventory balance was valued at last-in, first-out (“LIFO”) using the link chain technique of the dollar value method. At June 30, 2018 and July 1, 2017, the LIFO balance sheet reserves were $6.9 million and $6.6 million, respectively. Costs in inventory include the purchase price of the product and freight charges to deliver the product to the Company’s warehouses and are net of certain consideration received from vendors in the amount of $24.3 million and $22.9 million as of June 30, 2018 and July 1, 2017, respectively. The Company adjusts its inventory balances for slow-moving, excess, and obsolete inventories. These adjustments are based upon inventory category, inventory age, specifically identified items, and overall economic conditions. As of June 30, 2018 and July 1, 2017, the Company had adjusted its inventories by approximately $4.0 million and $4.5 million, respectively. Property, Plant, and Equipment Property, plant, and equipment are stated at cost. Depreciation of property, plant and equipment, including capital lease assets, is calculated primarily using the straight-line method over the estimated useful lives of the assets, which range from two to 39 years, and is included primarily in operating expenses on the consolidated statement of operations. Certain internal and external costs related to the development of internal use software are capitalized within property, plant, and equipment during the application development stage. When assets are retired or otherwise disposed, the costs and related accumulated depreciation are removed from the accounts. The difference between the net book value of the asset and proceeds from disposition is recognized as a gain or loss. Routine maintenance and repairs are charged to expense as incurred, while costs of betterments and renewals are capitalized. Impairment of Long-Lived Assets Long-lived assets held and used by the Company, including intangible assets with definite lives, are tested for recoverability whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. For purposes of evaluating the recoverability of long-lived assets, the Company compares the carrying value of the asset or asset group to the projected, undiscounted future cash flows expected to be generated by the long-lived asset or asset group. Based on the Company’s assessments, no impairment losses were recorded in fiscal 2018, fiscal 2017, or fiscal 2016. Acquisitions, Goodwill, and Other Intangible Assets The Company accounts for acquired businesses using the acquisition method of accounting. The Company’s financial statements reflect the operations of an acquired business starting from the completion of the acquisition. Goodwill and other intangible assets represent the excess of cost of an acquired entity over the amounts specifically assigned to those tangible net assets acquired in a business combination. Other identifiable intangible assets typically include customer relationships, trade names, technology, non-compete agreements, and favorable lease assets. Goodwill and intangibles with indefinite lives are not amortized. Intangibles with definite lives are amortized on a straight-line basis over their useful lives, which generally range from two to eleven years. Annually, or when certain triggering events occur, the Company assesses the useful lives of its intangibles with definite lives. Certain assumptions, estimates, and judgments are used in determining the fair value of net assets acquired, including goodwill and other intangible assets, as well as determining the allocation of goodwill to the reporting units. Accordingly, the Company may obtain the assistance of third-party valuation specialists for the valuation of significant tangible and intangible assets. The fair value estimates are based on available historical information and on future expectations and assumptions deemed reasonable by management but that are inherently uncertain. Significant estimates and assumptions inherent in the valuations reflect a consideration of other marketplace participants and include the amount and timing of future cash flows (including expected growth rates and profitability), economic barriers to entry, a brand’s relative market position, and the discount rate applied to the cash flows. Unanticipated market or macroeconomic events and circumstances may occur that could affect the accuracy or validity of the estimates and assumptions. The Company is required to test goodwill and other intangible assets with indefinite lives for impairment annually, or more often if circumstances indicate. Indicators of goodwill impairment include, but are not limited to, significant declines in the markets and industries that buy the Company’s products, changes in the estimated future cash flows of its reporting units, changes in capital markets, and changes in its market capitalization. For goodwill and indefinite-lived intangible assets, the Company’s policy is to assess impairment at the end of each fiscal year. The Company applies the guidance in Financial Accounting Standards Board (“FASB”) Accounting Standards Update (“ASU”) 2011-08 “Intangibles—Goodwill and Other—Testing Goodwill for Impairment During fiscal 2018 and fiscal 2017, the Company performed the step zero analysis for its goodwill impairment test. As a result of the Company’s step zero analysis, no further quantitative impairment test was deemed necessary for fiscal 2018 and fiscal 2017. There were no impairments of goodwill or intangible assets with indefinite lives for fiscal 2018, fiscal 2017, or fiscal 2016. Insurance Program The Company maintains high-deductible insurance programs covering portions of general and vehicle liability and workers’ compensation. The amounts in excess of the deductibles are fully insured by third-party insurance carriers and subject to certain limitations and exclusions. The Company also maintains self-funded group medical insurance. The Company accrues its estimated liability for these deductibles, including an estimate for incurred but not reported claims, based on known claims and past claims history. The estimated short-term portion of these accruals is included in Accrued expenses on the Company’s consolidated balance sheets, while the estimated long-term portion of the accruals is included in Other long-term liabilities. The provisions for insurance claims include estimates of the frequency and timing of claims occurrence, as well as the ultimate amounts to be paid. These insurance programs are managed by a third party, and the deductibles for general and vehicle liability and workers compensation are primarily collateralized by letters of credit and restricted cash. Other Comprehensive Income (Loss) (“OCI”) Other comprehensive income (loss) is defined as all changes in equity during each period except for those resulting from net income (loss) and investments by or distributions to shareholders. Other comprehensive income (loss) consists primarily of gains or losses from derivative financial instruments that are designated in a hedging relationship. For derivative instruments that qualify as cash flow hedges, the effective portion of the gain or loss on the derivative instrument is reported as a component of other comprehensive income and reclassified into earnings during the same period or periods during which the hedged transaction affects earnings. Revenue Recognition The Company recognizes revenue from the sale of a product when it is considered realized or realizable and earned. The Company determines these requirements to be met when the product has been delivered to the customer, the price is fixed and determinable, and there is reasonable assurance of collection of the sales proceeds. The Company grants certain customers sales incentives such as rebates or discounts and treats these as a reduction of sales at the time the sale is recognized. The Company recognizes revenues net of applicable sales tax. Sales returns are recorded as reductions of sales. Revenue is accounted for in accordance with FASB ASC 605-45, “ Reporting Revenue Gross as a Principal versus Net as an Agent • who is the primary obligor to provide the product or services desired by our customers; • who has discretion in supplier selection; • who has latitude in establishing price; • who retains credit risk; and • who bears inventory risk. When the Company determines that it does not meet the criteria for gross revenue recognition under ASC 605-45 on the basis of these factors, the Company reports the revenue on a net basis. When there is a change to an agreement with a customer or vendor, pursuant to the Company’s revenue recognition policy, the Company reevaluates the reporting of the revenue based on the factors outlined above to determine if there has been a change in the Company’s relationship in acting as the principal or an agent. Cost of Goods Sold Cost of goods sold includes amounts paid to manufacturers for products sold, the cost of transportation necessary to bring the products to the Company’s facilities, plus depreciation related to processing facilities and equipment. Operating Expenses Operating expenses include warehouse, delivery, occupancy, insurance, depreciation, amortization, salaries and wages, and employee benefits expenses. Vendor Rebates and Other Promotional Incentives The Company participates in various rebate and promotional incentives with its suppliers, primarily including volume and growth rebates, annual and multi-year incentives, and promotional programs. Consideration received under these incentives is generally recorded as a reduction of cost of goods sold. However, as described below, in certain limited circumstances the consideration is recorded as a reduction of operating expenses incurred by the Company. Consideration received may be in the form of cash and/or invoice deductions. Changes in the estimated amount of incentives to be received are treated as changes in estimates and are recognized in the period of change. Consideration received for incentives that contain volume and growth rebates and annual and multi-year incentives are recorded as a reduction of cost of goods sold. The Company systematically and rationally allocates the consideration for these incentives to each of the underlying transactions that results in progress by the Company toward earning the incentives. If the incentives are not probable and reasonably estimable, the Company records the incentives as the underlying objectives or milestones are achieved. The Company records annual and multi-year incentives when earned, generally over the agreement period. The Company uses current and historical purchasing data, forecasted purchasing volumes, and other factors in estimating whether the underlying objectives or milestones will be achieved. Consideration received to promote and sell the supplier’s products is typically a reimbursement of marketing costs incurred by the Company and is recorded as a reduction of the Company’s operating expenses. If the amount of consideration received from the suppliers exceeds the Company’s marketing costs, any excess is recorded as a reduction of cost of goods sold. The Company follows the requirements of FASB ASC 605-50-25-10, Revenue Recognition—Customer Payments and Incentives—Recognition—Customer’s Accounting for Certain Consideration Received from a Vendor Revenue Recognition—Customer Payments and Incentives—Other Presentation Matters—Reseller’s Characterization of Sales Incentives Offered to Customers by Manufacturers Shipping and Handling Fees and Costs Shipping and handling fees billed to customers are included in net sales. Estimated shipping and handling costs incurred by the Company of $884.5 million, $807.7 million, and $752.0 million are recorded in operating expenses in the consolidated statement of operations for fiscal 2018, fiscal 2017, and fiscal 2016, respectively. Stock-Based Compensation The Company participates in the Performance Food Group Company 2007 Management Option Plan (the “2007 Option Plan”) and the Performance Food Group Company 2015 Omnibus Incentive Plan (the “2015 Incentive Plan”) and follows the fair value recognition provisions of FASB ASC 718-10-25, Compensation—Stock Compensation—Overall—Recognition Income Taxes The Company follows FASB ASC 740-10, Income Taxes—Overall Derivative Instruments and Hedging Activities As required by FASB ASC 815-20, Derivatives and Hedging—Hedging—General Derivatives and Hedging Activities The Company discloses derivative instruments and hedging activities in accordance with FASB ASC 815-10-50, Derivatives and Hedging—Overall—Disclosure Fair Value Measurements Fair value is defined as an exit price, representing the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The accounting guidance establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The three levels of the fair value hierarchy are as follows: • Level 1—Observable inputs such as quoted prices for identical assets or liabilities in active markets; • Level 2—Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly for substantially the full term of the asset or liability; and • Level 3—Unobservable inputs in which there are little or no market data, which include management’s own assumption about the risk assumptions market participants would use in pricing an asset or liability. The Company’s derivative instruments are carried at fair value and are evaluated in accordance with this hierarchy. Contingent Liabilities The Company records a liability related to contingencies when a loss is considered to be probable and a reasonable estimate of the loss can be made. This estimate would include legal fees, if applicable. |
Recently Issued Accounting Pron
Recently Issued Accounting Pronouncements | 12 Months Ended |
Jun. 30, 2018 | |
Accounting Changes And Error Corrections [Abstract] | |
Recently Issued Accounting Pronouncements | 3. Recently Adopted Accounting Pronouncements In July 2015, the FASB issued ASU 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments Based on our review of the ASU, the Company concluded that it has historically classified the specified cash receipts and cash payments in accordance with the clarified guidance. This ASU did not have a material impact on the Company’s consolidated financial statements. In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash for the fiscal years ended July 1, 2017 and July 2, 2016 include restricted cash with cash when reconciling the beginning-of-period and end-of-period total amounts. As a result of the adoption of ASU 2016-18, cash payments of $7.3 million in fiscal 2016 related to insurance claims paid using restricted cash is classified as a change in Accrued expenses and other liabilities within Net cash provided by operating activities. In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment In February 2018, the FASB issued ASU 2018-02, Income Statement—Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income Recently Issued Accounting Pronouncements Not Yet Adopted In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) The Company adopted this standard at the beginning of fiscal year 2019 using the modified retrospective approach. The Company has completed its analysis of the new standard and determined that the Company’s customer contracts include one performance obligation which is satisfied once the products are delivered to the customer. Revenue will be recognized at the point in time in which the Company transfers control of the products to the customer. This is consistent with the Company’s current practice of recognizing revenue upon delivery to the customer. For the first quarter of fiscal 2019, the Company will be required to make enhanced revenue disclosures, which will include relevant information about contracts with customers, disaggregated revenues, performance obligations and other items requiring significant judgments and estimates used to recognize revenue. The Company has revised its relevant policies and procedures, as applicable, to meet the new accounting, reporting and disclosure requirements of Topic 606 and has updated internal controls accordingly. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) Leases (Topic 842): Targeted Improvements In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities. |
Business Combinations
Business Combinations | 12 Months Ended |
Jun. 30, 2018 | |
Business Combinations [Abstract] | |
Business Combinations | 4. During fiscal year 2018, the Company paid cash of $72.7 million for two acquisitions. During fiscal year 2017, the Company paid cash of $193.6 million for seven acquisitions and during fiscal 2016, the Company paid cash of $39.0 million for two acquisition. These acquisitions did not materially affect the Company’s results of operations. The following table summarizes the preliminary purchase price allocation for each major class of assets acquired and liabilities assumed for the fiscal 2018 acquisitions. (In millions) Fiscal 2018 Net working capital $ 24.9 Goodwill 21.3 Other intangible assets 24.7 Property, plant and equipment 1.8 Total purchase price $ 72.7 Subsequent to June 30, 2018, the Company paid $31.5 million for an acquisition. The Company is in the process of determining the fair values of the assets acquired and liabilities assumed. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 12 Months Ended |
Jun. 30, 2018 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | 5. The Company recorded additions to goodwill in connection with its acquisitions. The goodwill is a result of expected synergies from combined operations of the acquisitions and the Company. The following table presents the changes in the carrying amount of goodwill: (In millions) Performance Foodservice PFG Customized Vistar Other Total Balance as of July 2, 2016 $ 405.3 $ 166.5 $ 63.0 $ 39.2 $ 674.0 Acquisitions—current year 22.9 — 2.3 19.8 45.0 Adjustment related to prior year acquisitions — — (0.4 ) — (0.4 ) Balance as of July 1, 2017 428.2 166.5 64.9 59.0 718.6 Acquisitions—current year — — 21.3 — 21.3 Adjustment related to prior year acquisitions 0.3 — — 0.3 0.6 Balance as of June 30, 2018 $ 428.5 $ 166.5 $ 86.2 $ 59.3 $ 740.5 The fiscal 2018 adjustment related to prior year acquisitions is the result of net working capital adjustments. The following table presents the Company’s intangible assets by major category as of June 30, 2018 and July 1, 2017: As of June 30, 2018 As of July 1, 2017 (In millions) Gross Carrying Amount Accumulated Amortization Net Gross Carrying Amount Accumulated Amortization Net Range of Lives Intangible assets with definite lives: Customer relationships $ 477.3 $ (360.4 ) $ 116.9 $ 457.0 $ (337.4 ) $ 119.6 4 – 11 years Trade names and trademarks 106.0 (95.4 ) 10.6 106.0 (92.3 ) 13.7 4 – 9 years Deferred financing costs 45.5 (38.0 ) 7.5 44.2 (35.2 ) 9.0 Debt term Non-compete 31.2 (17.8 ) 13.4 26.8 (14.0 ) 12.8 2 – 5 years Leases 12.5 (6.6 ) 5.9 12.5 (6.0 ) 6.5 Lease term Technology 26.1 (26.1 ) — 26.1 (26.1 ) — 5 – 7 years Total intangible assets with definite lives $ 698.6 $ (544.3 ) $ 154.3 $ 672.6 $ (511.0 ) $ 161.6 Intangible assets with indefinite lives: Goodwill $ 740.5 $ — $ 740.5 $ 718.6 $ — $ 718.6 Indefinite Trade names 39.5 — 39.5 39.5 — 39.5 Indefinite Total intangible assets with indefinite lives $ 780.0 $ — $ 780.0 $ 758.1 $ — $ 758.1 For the intangible assets with definite lives, the Company recorded amortization expense of $33.3 million for fiscal 2018, $37.7 million for fiscal 2017, and $42.3 million for fiscal 2016. For the next five fiscal periods and thereafter, the estimated future amortization expense on intangible assets with definite lives are as follows: (In millions) 2019 $ 33.7 2020 30.4 2021 29.4 2022 24.2 2023 12.4 Thereafter 24.2 Total amortization expense $ 154.3 |
Concentration of Sales and Cred
Concentration of Sales and Credit Risk | 12 Months Ended |
Jun. 30, 2018 | |
Risks And Uncertainties [Abstract] | |
Concentration of Sales and Credit Risk | 6. The Company had no customers that comprised more than 10% of consolidated net sales for fiscal 2018, fiscal 2017, or fiscal 2016. At June 30, 2018 and July 1, 2017, respectively, the Company had no customers that comprised more than 10% of consolidated accounts receivable. The Company maintains an allowance for doubtful accounts for which details are disclosed in the accounts receivable portion of Note 2, Summary of Significant Accounting Policies and Estimates—Accounts Receivable Financial instruments that potentially expose the Company to concentrations of credit risk consist primarily of trade accounts receivable. The Company’s customer base includes a large number of individual restaurants, national and regional chain restaurants, and franchises and other institutional customers. The credit risk associated with accounts receivable is minimized by the Company’s large customer base and ongoing monitoring of customer creditworthiness. |
Property, Plant, and Equipment
Property, Plant, and Equipment | 12 Months Ended |
Jun. 30, 2018 | |
Property Plant And Equipment [Abstract] | |
Property, Plant, and Equipment | 7. Property, plant, and equipment as of June 30, 2018 and July 1, 2017 consisted of the following: (In millions) As of June 30, 2018 As of July 1, 2017 Range of Lives Buildings and building improvements $ 477.1 $ 452.7 10 – 39 years Land 48.7 47.9 — Transportation equipment 152.6 136.4 2 – 10 years Warehouse and plant equipment 257.5 242.3 3 – 20 years Office equipment, furniture, and fixtures 279.7 247.8 2 – 10 years Leasehold improvements 114.0 108.3 Lease term(1) Construction-in-process 85.2 50.8 1,414.8 1,286.2 Less: accumulated depreciation and amortization (619.3 ) (545.5 ) Property, plant and equipment, net $ 795.5 $ 740.7 (1) Leasehold improvements are depreciated over the shorter of the useful life of the asset or the lease term. Total depreciation expense for the fiscal 2018, fiscal 2017, and fiscal 2016 was $100.3 million, $91.5 |
Debt
Debt | 12 Months Ended |
Jun. 30, 2018 | |
Debt Disclosure [Abstract] | |
Debt | 8. The Company is a holding company and conducts its operations through its subsidiaries, which have incurred or guaranteed indebtedness as described below. Debt consisted of the following: (In millions) As of June 30, 2018 As of July 1, 2017 ABL Facility $ 780.1 $ 899.9 5.500% Notes due 2024 350.0 350.0 Promissory Note — 6.0 Less: Original issue discount and deferred financing costs (7.1 ) (8.2 ) Long-term debt 1,123.0 1,247.7 Capital and finance lease obligations 61.2 49.9 Total debt 1,184.2 1,297.6 Less: current installments (8.4 ) (11.7 ) Total debt, excluding current installments $ 1,175.8 $ 1,285.9 ABL Facility PFGC, Inc. (“PFGC”), a wholly-owned subsidiary of the Company, is a party to the Second Amended and Restated Credit Agreement Borrowings under the ABL Facility bear interest, at Performance Food Group, Inc.’s option, at (a) the Base Rate (defined as the greater of (i) the Federal Funds Rate in effect on such date plus 0.5%, (ii) the Prime Rate on such day, or (iii) one month LIBOR plus 1.0%) plus a spread or (b) LIBOR plus a spread. The ABL Facility also provides for an unused commitment fee ranging from 0.25% to 0.375%. The following table summarizes outstanding borrowings, availability, and the average interest rate under the ABL Facility: (Dollars in millions) As of June 30, 2018 As of July 1, 2017 Aggregate borrowings $ 780.1 $ 899.9 Letters of credit 121.3 105.5 Excess availability, net of lenders’ reserves of $12.1 and $11.2, respectively 854.2 594.6 Average interest rate 3.52 % 2.59 % The ABL Facility contains covenants requiring the maintenance of a minimum consolidated fixed charge coverage ratio if excess availability falls below the greater of (i) $160.0 million and (ii) 10% of the lesser of the borrowing base and the revolving credit facility amount for five consecutive business days. The ABL Facility also contains customary restrictive covenants that include, but are not limited to, restrictions on PFGC’s ability to incur additional indebtedness, pay dividends, create liens, make investments or specified payments, and dispose of assets. The ABL Facility provides for customary events of default, including payment defaults and cross-defaults on other material indebtedness. If an event of default occurs and is continuing, amounts due under such agreement may be accelerated and the rights and remedies of the lenders under the ABL Facility may be exercised, including rights with respect to the collateral securing the obligations under such agreement. S enior Notes On May 17, 2016, Performance Food Group, Inc. issued and sold $350.0 million aggregate principal amount of its 5.500% Senior Notes due 2024 (the “Notes”), pursuant to an indenture dated as of May 17, 2016. The Notes are jointly and severally guaranteed on a senior unsecured basis by PFGC and all domestic direct and indirect wholly-owned subsidiaries of PFGC (other than captive insurance subsidiaries and other excluded subsidiaries). The Notes are not guaranteed by Performance Food Group Company. The proceeds from the Notes were used to pay in full the remaining outstanding aggregate principal amount of the Term Facility and to terminate the facility; to temporarily repay a portion of the outstanding borrowings under the ABL Facility; and to pay the fees, expenses, and other transaction costs incurred in connection with the Notes. The Notes were issued at 100.0% of their par value. The Notes mature on June 1, 2024 and bear interest at a rate of 5.500% per year, payable semi-annually in arrears. Upon the occurrence of a change of control triggering event or upon the sale of certain assets in which Performance Food Group, Inc. does not apply the proceeds as required, the holders of the Notes will have the right to require Performance Food Group, Inc. to repurchase each holder’s Notes at a price equal to 101% (in the case of a change of control triggering event) or 100% (in the case of an asset sale) of their principal amount, plus accrued and unpaid interest. Performance Food Group, Inc. may redeem all or a part of the Notes at any time prior to June 1, 2019 at a redemption price equal to 100% of the principal amount of the Notes being redeemed plus a make-whole premium and accrued and unpaid interest, if any, to, but not including, the redemption date. In addition, beginning on June 1, 2019, Performance Food Group, Inc. may redeem all or a part of the Notes at a redemption price equal to 102.750% of the principal amount redeemed. The redemption price decreases to 101.325% and 100.000% of the principal amount redeemed on June 1, 2020 and June 1, 2021, respectively. In addition, at any time prior to June 1, 2019, Performance Food Group, Inc. may redeem up to 40% of the Notes from the proceeds of certain equity offerings at a redemption price equal to 105.500% of the principal amount thereof, plus accrued and unpaid interest. The indenture governing the Notes contains covenants limiting, among other things, PFGC and its restricted subsidiaries’ ability to incur or guarantee additional debt or issue disqualified stock or preferred stock; pay dividends and make other distributions on, or redeem or repurchase, capital stock; make certain investments; incur certain liens; enter into transactions with affiliates; consolidate, merge, sell or otherwise dispose of all or substantially all of its assets; create certain restrictions on the ability of PFGC’s restricted subsidiaries to make dividends or other payments to PFGC; designate restricted subsidiaries as unrestricted subsidiaries; and transfer or sell certain assets. These covenants are subject to a number of important exceptions and qualifications. The Notes also contain customary events of default, the occurrence of which could result in the principal of and accrued interest on the Notes to become or be declared due and payable. The ABL Facility and the indenture governing the Notes contain customary restrictive covenants under which all of the net assets of PFGC and its subsidiaries were restricted from distribution to Performance Food Group Company, except for approximately $486.0 million of restricted payment capacity available under such debt agreements, as of June 30, 2018. Such minimum estimated restricted payment capacity is calculated based on the most restrictive of our debt agreements and may fluctuate from period to period, which fluctuations may be material. Our restricted payment capacity under other debt instruments to which the Company is subject may be materially higher than the foregoing estimate. Term Facility In fiscal 2016, the Company used the proceeds from its IPO, borrowings under the ABL Facility, and a portion of the proceeds from the Notes issuance to repay the outstanding aggregate principal amount of the Term Facility and to terminate the facility. As a result of these payments, a $9.4 million loss on extinguishment and $5.5 million of accelerated amortization of original issuance discount and deferred financing costs was recorded in fiscal 2016. Unsecured Subordinated Promissory Note In connection with an acquisition, Performance Food Group, Inc. issued a $6.0 million interest only, unsecured subordinated promissory note on December 21, 2012. The $6.0 million promissory note was paid off in December 2017. Fiscal year maturities of long-term debt, excluding capital and finance lease obligations, are as follows: (In millions) 2019 $ — 2020 — 2021 780.1 2022 — 2023 — Thereafter 350.0 Total long-term debt, excluding capital and finance lease obligations $ 1,130.1 Capital and Finance Lease Obligations Performance Food Group, Inc. is a party to facility leases at two Performance Foodservice distribution facilities and several equipment leases that are accounted for as capital leases in accordance with FASB ASC 840-30, Leases—Capital Leases (In millions) Capital Leases 2019 $ 12.1 2020 10.0 2021 9.6 2022 9.4 2023 8.3 Thereafter 33.5 Total future minimum lease payments 82.9 Less: interest 21.7 Present value of future minimum lease payments $ 61.2 During the first quarter of fiscal 2015, Performance Food Group, Inc. sold and simultaneously leased back a Vistar distribution facility for a period of two years. As a result of continuing involvement with the property, this transaction did not meet the criteria to qualify as a sale-leaseback. In accordance with FASB ASC 840-40, Leases—Sale Leaseback Transactions |
Derivatives and Hedging Activit
Derivatives and Hedging Activities | 12 Months Ended |
Jun. 30, 2018 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Derivatives and Hedging Activities | 9. Risk Management Objective of Using Derivatives The Company is exposed to certain risks arising from both its business operations and economic conditions. The Company principally manages its exposures to a wide variety of business and operational risks through management of its core business activities. The Company manages economic risks, including interest rate, liquidity, and credit risk primarily by managing the amount, sources, and duration of its debt funding and the use of derivative financial instruments. Specifically, the Company enters into derivative financial instruments to manage exposures that arise from business activities that result in the receipt or payment of future known and uncertain cash amounts, the value of which are determined by interest rates and diesel fuel costs. The Company’s derivative financial instruments are used to manage differences in the amount, timing, and duration of the Company’s known or expected cash receipts and payments related to the Company’s borrowings and diesel fuel purchases. The effective portion of changes in the fair value of derivatives that are both designated and qualify as cash flow hedges is recorded in other comprehensive income and subsequently reclassified into earnings in the period that the hedged transaction occurs. The ineffective portion of the change in fair value of the derivatives is recognized directly in earnings. Hedges of Interest Rate Risk The Company’s objectives in using interest rate derivatives are to add stability to interest expense and to manage its exposure to interest rate movements. Since the Company has a substantial portion of its debt in variable-rate instruments, it accomplishes this objective with interest rate swaps. These swaps are designated as cash flow hedges and involve the receipt of variable-rate amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. All of the Company’s interest rate swaps are designated and qualify as cash flow hedges. As of June 30, 2018, Performance Food Group, Inc. had eight interest rate swaps with a combined $650.0 million notional amount. The following table summarizes the outstanding Swap Agreements as of June 30, 2018 (in millions): Effective Date Maturity Date Notional Amount Fixed Rate Swapped August 9, 2013 August 9, 2018 $ 200.0 1.51 % June 30, 2017 June 30, 2019 50.0 1.13 % June 30, 2017 June 30, 2020 50.0 1.23 % June 30, 2017 June 30, 2020 50.0 1.25 % June 30, 2017 June 30, 2020 50.0 1.26 % August 9, 2018 August 9, 2021 75.0 1.21 % August 9, 2018 August 9, 2021 75.0 1.20 % June 30, 2020 December 31, 2021 100.0 2.16 % The tables below present the effect of the interest rate swaps designated in hedging relationships on the consolidated statement of operations for the fiscal years ended June 30, 2018, July 1, 2017 and July 2, 2016: (in millions) Fiscal year ended June 30, 2018 Fiscal year ended July 1, 2017 Fiscal year ended July 2, 2016 Amount of (gain) loss recognized in OCI, pre-tax $ (7.9 ) $ (9.3 ) $ 9.3 Tax expense (benefit) 2.1 3.6 (3.6 ) Amount of (gain) loss recognized in OCI, after-tax $ (5.8 ) $ (5.7 ) $ 5.7 Amount of gain (loss) reclassified from OCI into interest expense, pre-tax $ 0.6 $ (4.0 ) $ (7.3 ) Tax (expense) benefit (0.2 ) 1.5 2.9 Amount of gain (loss) reclassified from OCI into interest expense, after-tax $ 0.4 $ (2.5 ) $ (4.4 ) As interest payments are made on the Company’s variable rate debt, amounts are reclassified from Accumulated other comprehensive income to Interest expense. The Company recorded a loss of $0.1 million, a gain of $1.5 million, and a loss of $0.5 million Hedges of Forecasted Diesel Fuel Purchases From time to time, Performance Food Group, Inc. enters into costless collar arrangements to manage its exposure to variability in cash flows expected to be paid for its forecasted purchases of diesel fuel. As of June 30, 2018, Performance Food Group, Inc. was a party to three such arrangements, with an aggregate 4.5 million gallon original notional amount. The 4.5 million gallon forecasted purchases of diesel fuel are expected to be made between July 1, 2018 and December 31, 2018. The fuel collar instruments do not qualify for hedge accounting. Accordingly, the derivative instruments are recorded as an asset or liability on the balance sheet at fair value and any changes in fair value are recorded in the period of change as unrealized gains or losses on fuel hedging instruments and included in Other, net in the accompanying consolidated statement of operations. The Company does not currently have a payable or receivable related to cash collateral for its derivatives, and therefore it has not established an accounting policy for offsetting the fair value of its derivatives against such balances. The table below presents the fair value of the derivative financial instruments as well as their classification on the balance sheet as of June 30, 2018 and July 1, 2017: (in millions) Balance Sheet Location Fair Value as of June 30, 2018 Fair Value as of July 1, 2017 Assets Derivatives designated as hedges: Interest rate swaps Prepaid expenses and other current assets $ 4.0 $ 0.3 Interest rate swaps Other assets 8.4 5.0 Derivatives not designated as hedges: Diesel fuel collars Prepaid expenses and other current assets 0.1 — Total assets $ 12.5 $ 5.3 Liabilities Derivatives designated as hedges: Interest rate swaps Accrued expenses and other current liabilities $ — $ 0.3 Total liabilities $ — $ 0.3 All of the Company’s derivative contracts are subject to a master netting arrangement with the respective counterparties that provide for the net settlement of all derivative contracts in the event of default or upon the occurrence of certain termination events. Upon exercise of termination rights by the non-defaulting party (i) all transactions are terminated, (ii) all transactions are valued and the positive value or “in the money” transactions are netted against the negative value or “out of the money” transactions, and (iii) the only remaining payment obligation is of one of the parties to pay the netted termination amount. The Company has elected to present the derivative assets and derivative liabilities on the balance sheet on a gross basis for periods ended June 30, 2018 and July 1, 2017. The tables below present the derivative assets and liability balance, before and after the effects of offsetting, as of June 30, 2018 and July 1, 2017: June 30, 2018 July 1, 2017 (In millions) Gross Amounts Presented in the Consolidated Balance Sheet Gross Amounts Not Offset in the Balance Sheet Subject to Netting Agreements Net Amounts Gross Amounts Presented in the Consolidated Balance Sheet Gross Amounts Not Offset in the Consolidated Balance Sheet Subject to Netting Agreements Net Amounts Total asset derivatives: $ 12.5 $ — $ 12.5 $ 5.3 $ — $ 5.3 Total liability derivatives: — — — 0.3 — 0.3 The derivative instruments are the only assets or liabilities that are recorded at fair value on a recurring basis. The fuel collars are exchange-traded commodities and their fair value is derived from valuation models based on certain assumptions regarding market conditions, some of which may be unobservable. Based on the lack of significance of these unobservable inputs, the Company has concluded that these instruments represent Level 2 on the fair value hierarchy. The fair values of the Company’s interest rate swap agreements are determined using a valuation model with several inputs and assumptions, some of which may be unobservable. A specific unobservable input used by the Company in determining the fair value of its interest rate swaps is an estimation of both the unsecured borrowing spread to LIBOR for the Company as well as that of the derivative counterparties. Based on the lack of significance of this estimated spread component to the overall value of the Company’s interest rate swaps, the Company has concluded that these swaps represent Level 2 on the hierarchy. There have been no transfers between levels in the hierarchy from July 1, 2017 to June 30, 2018. Credit-Risk-Related Contingent Features The Company has agreements with each of its derivative counterparties that provide that if the Company either defaults or is capable of being declared in default on any of its indebtedness, the Company can also be declared in default on its derivative obligations. As of June 30, 2018, the aggregate fair value amount of all derivative instruments that contain contingent features were in a net asset position. |
Insurance Program Liabilities
Insurance Program Liabilities | 12 Months Ended |
Jun. 30, 2018 | |
Insurance [Abstract] | |
Insurance Program Liabilities | 10. The Company maintains high-deductible insurance programs covering portions of general and vehicle liability, workers’ compensation, and group medical insurance. The amounts in excess of the deductibles are fully insured by third-party insurance carriers, subject to certain limitations. A summary of the activity in all types of deductible liabilities appears below: (In millions) Balance at June 27, 2015 $ 84.0 Charged to costs and expenses 146.7 Payments (143.4 ) Balance at July 2, 2016 $ 87.3 Charged to costs and expenses 165.2 Payments (154.7 ) Balance at July 1, 2017 $ 97.8 Charged to costs and expenses 164.5 Payments (154.9 ) Balance at June 30, 2018 $ 107.4 |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 12 Months Ended |
Jun. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | 11. Fair Value of Financial Instruments The carrying values of cash, accounts receivable, outstanding checks in excess of deposits, trade accounts payable, and accrued expenses approximate their fair values because of the relatively short maturities of those instruments. The derivative assets and liabilities are recorded at fair value on the balance sheet. The fair value of long-term debt, which has a carrying value of $1,123.0 million and $1,247.7 million, is $1,126.7 million and $1,258.3 million at June 30, 2018 and July 1, 2017, respectively, and is determined by reviewing current market pricing related to comparable debt issued at the time of the balance sheet date, and is considered a Level 2 measurement. |
Leases
Leases | 12 Months Ended |
Jun. 30, 2018 | |
Leases [Abstract] | |
Leases | 12. Subsidiaries of the Company lease various warehouse and office facilities and certain equipment under long-term operating lease agreements that expire at various dates. Rent expense for operating leases includes any rent increases, rent holidays, or landlord concessions on a straight-line basis over the lease term. As of June 30, 2018, subsidiaries of the Company are obligated under non-cancelable operating lease agreements to make future minimum lease payments as follows: (In millions) 2019 $ 91.5 2020 81.2 2021 65.6 2022 52.9 2023 39.7 Thereafter 119.5 Total minimum lease payments $ 450.4 Rent expense for operating leases was $119.9 million for fiscal 2018, $115.7 million for fiscal 2017, and $105.7 million for fiscal 2016. A subsidiary of the Company has posted letters of credit as collateral supporting certain leases. These letters of credit are included in the total outstanding letters of credit under the ABL Facility as discussed in Note 8, Debt Subsidiaries of the Company have residual value guarantees to their lessors under certain of their operating leases. These guarantees are discussed in Note 15 Commitments and Contingencies A subsidiary of the Company is a party to several capital leases. See Note 8, Debt |
Income Taxes
Income Taxes | 12 Months Ended |
Jun. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 13. Income tax expense for fiscal 2018, fiscal 2017 and fiscal 2016 consisted of the following: (In millions) For the fiscal year ended June 30, 2018 For the fiscal year ended July 1, 2017 For the fiscal year ended July 2, 2016 Current income tax (benefit) expense: Federal $ (8.6 ) $ 45.8 $ 40.2 State 2.1 9.3 6.4 Total current income tax (benefit) expense (6.5 ) 55.1 46.6 Deferred income tax (benefit) expense: Federal (7.2 ) 3.6 (1.1 ) State 8.6 2.7 0.7 Total deferred income tax expense (benefit) 1.4 6.3 (0.4 ) Total income tax (benefit) expense, net $ (5.1 ) $ 61.4 $ 46.2 The determination of the Company’s overall effective tax rate requires significant judgment, the use of estimates and the interpretation and application of complex tax laws. The effective tax rate reflects the income earned and taxed in various United States federal and state jurisdictions. Tax law changes, increases and decreases in temporary and permanent differences between book and tax items, tax credits, and the Company’s change in income in each jurisdiction all affect the overall effective tax rate. It is the Company’s practice to recognize interest and penalties related to uncertain tax positions in income tax expense. On December 22, 2017, the Act was signed into law. The Act makes broad and complex changes to the U.S. Internal Revenue Code including, but not limited to: reducing the U.S. federal corporate tax rate from 35% to 21%; creating a new limitation on deductible interest expense; repealing the domestic production activity deduction; providing for bonus depreciation that will allow for full expensing of certain qualified property; and limiting other deductions. The Securities and Exchange Commission (“SEC”) staff issued Staff Accounting Bulletin 118 (“SAB 118”), which provides guidance on accounting for the tax effects of the Act. SAB 118 provides a measurement period that should not extend beyond one year from the Act enactment date for companies to complete the accounting under FASB ASC 740, Income Taxes The Company’s effective income tax rate for continuing operations for fiscal 2018, fiscal 2017 and fiscal 2016 was (2.6)%, 39.0%, and 40.3%, respectively. As a result of the reduction in the federal corporate income tax rate to 21% from 35% under the Act, the Company has a blended federal statutory rate of 28% for the fiscal year ending June 30, 2018. Actual income tax (benefit) expense differs from the amount computed by applying the applicable U.S. federal statutory corporate income tax rate of 28% in fiscal 2018 and 35% in fiscal 2017 and fiscal 2016 to earnings before income taxes as follows: (In millions) For the fiscal year ended June 30, 2018 For the fiscal year ended July 1, 2017 For the fiscal year ended July 2, 2016 Federal income tax expense computed at statutory rate $ 54.3 $ 55.2 $ 40.0 Increase (decrease) in income taxes resulting from: State income taxes, net of federal income tax benefit 10.4 7.5 4.8 Non-deductible expenses and other 1.7 3.4 2.7 Tax law change (50.4 ) — — Stock-based compensation (20.6 ) (4.7 ) (1.3 ) Other (0.5 ) — — Total income tax (benefit) expense, net $ (5.1 ) $ 61.4 $ 46.2 During the fiscal year ended June 30, 2018, performance vesting criteria for certain stock-based compensation awards was met resulting in a significant permanent tax deduction difference. The impact to the provision for stock-based compensation and the impact of the reduction in tax rate under the Act are summarized as follows: Fiscal year ended June 30, 2018 (Dollars in millions) Income Tax Expense Effective Tax Rate Income tax (benefit), reported $ (5.1 ) -2.6 % Revaluation of net deferred income tax liability 38.5 19.9 % Other impact of tax law change 11.9 6.1 % Stock-based compensation - performance vesting 15.4 8.0 % Income tax expense, excluding benefits $ 60.7 31.4 % Deferred income taxes are recorded based upon the tax effects of differences between the financial statement and tax bases of assets and liabilities and available tax loss and credit carry-forwards. Temporary differences and carry-forwards that created significant deferred tax assets and liabilities were as follows: (In millions) As of June 30, 2018 As of July 1, 2017 Deferred tax assets: Allowance for doubtful accounts $ 3.1 $ 4.0 Inventories 4.3 7.0 Accrued employee benefits 6.9 9.8 Self-insurance reserves 1.6 2.5 Net operating loss carry-forwards 5.8 4.2 Stock-based compensation 6.4 12.0 Deferred rent 0.6 1.0 Other assets 0.9 2.6 Total gross deferred tax assets 29.6 43.1 Less: Valuation allowance (0.4 ) — Total net deferred tax assets 29.2 43.1 Deferred tax liabilities: Property, plant, and equipment 82.8 86.8 Other comprehensive income 2.9 1.5 Basis difference in intangible assets 34.1 51.1 Prepaid expenses 15.6 6.5 Other 0.1 0.2 Total deferred tax liabilities 135.5 146.1 Total net deferred income tax liability $ 106.3 $ 103.0 The state net operating loss carry-forwards expire in fiscal years 2018 through 2037. For the fiscal year ending June 30, 2018, the Company established a valuation allowance of $0.4 million, net of federal tax benefit, against deferred tax assets related to certain net operating losses which are not likely to be realized due to limitations on utilization. The Company records a liability for Uncertain Tax Positions in accordance with FASB ASC 740-10-25, Income Taxes—General—Recognition. (In millions) Balance as of June 27, 2015 $ 0.9 Increases due to current year positions — Settlements with taxing authorities (0.1 ) Expiration of statutes of limitations (0.4 ) Balance as of July 2, 2016 0.4 Increases due to current year positions 0.5 Increases due to prior years positions 0.6 Expiration of statutes of limitations (0.2 ) Balance as of July 1, 2017 1.3 Increases due to current year positions 0.2 Decreases due to prior years positions (0.2 ) Expiration of statutes of limitations (0.1 ) Balance as of June 30, 2018 $ 1.2 Included in the balance as of June 30, 2018 and July 1, 2017, is $1.2 million and $1.3 million, respectively, of unrecognized tax benefits that could affect the effective tax rate for continuing operations. The balance in unrecognized tax benefits relates primarily to transfer pricing and state tax issues. As of June 30, 2018, substantially all federal, state and local, and foreign income tax matters have been concluded for years through fiscal 2014. The Company does not anticipate that changes in the amount of unrecognized tax benefits over the next twelve months will have a significant impact on its results of operations or financial position. It is the Company’s practice to recognize interest and penalties related to uncertain tax positions in income tax expense. Approximately $0.2 million and $0.1 million was accrued for interest related to uncertain tax positions as of June 30, 2018 and July 1, 2017, respectively. Net interest expense of less than $0.1 million was recognized in tax expense for fiscal 2018, fiscal 2017 and fiscal 2016. |
Retirement Plans
Retirement Plans | 12 Months Ended |
Jun. 30, 2018 | |
Postemployment Benefits [Abstract] | |
Retirement Plans | 14. Employee Savings Plans The Company sponsors the Performance Food Group Employee Savings Plan (the “PFG Savings Plan”). The PFG Savings Plan consists of two components: a defined contribution plan covering substantially all employees (the “401(k) Plan”) and a profit sharing plan. Under the latter, the Company can make a discretionary contribution in a given year, although there is no requirement to do so, and no such contribution was made in fiscal years 2018 or 2017. As of January 1, 2009, the 401(k) plan merged with the Self-Directed Tax Advantaged Retirement (STAR) Plan of PFGC, Inc. (the “STAR Plan”). Employees participating in the 401(k) Plan may elect to contribute between 1% and 50% of their qualified compensation, up to a maximum dollar amount as specified by the provisions of the Internal Revenue Code. The Company matched 100% of the first 3.5% of the employee contributions, resulting in matching contributions of $17.9 million for fiscal 2018, $16.5 million for fiscal 2017, and $16.0 million for fiscal 2016. Associates that were eligible for the annual STAR Plan contribution (an annual amount based on the employee’s salary and years of service) as of December 31, 2008 remained eligible to receive STAR Plan contributions under the merged PFG Savings Plan. STAR Plan contributions made by the Company were $3.9 million for fiscal 2018, $3.9 million for fiscal 2017, and $4.2 million for fiscal 2016. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Jun. 30, 2018 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 15. Purchase Obligations The Company had outstanding contracts and purchase orders for capital projects and services totaling $26.4 million at June 30, 2018. Amounts due under these contracts were not included on the Company’s consolidated balance sheet as of June 30, 2018. Withdrawn Multiemployer Pension Plans Until May 2013, Performance Food Group, Inc. participated in the Central States Southeast and Southwest Areas Pension Fund (“Central States Pension Fund”), a multiemployer pension plan administered by the Teamsters Union, pursuant to which Performance Food Group, Inc. was required to make contributions on behalf of certain union employees. The Central States Pension Fund is underfunded and is in critical status as determined by the Pension Benefit Guaranty Corporation. In connection with a renegotiation of the collective bargaining agreement that had previously required the Company’s participation in the Central States Pension Fund, the Company negotiated the termination of its participation in the Central States Pension Fund and the Company has withdrawn. Guarantees Subsidiaries of the Company have entered into numerous operating leases, including leases of buildings, equipment, tractors, and trailers. Certain of the leases for tractors, trailers, and other vehicles and equipment, provide for residual value guarantees to the lessors. Circumstances that would require the subsidiary to perform under the guarantees include either (1) default on the leases with the leased assets being sold for less than the specified residual values in the lease agreements, or (2) decisions not to purchase the assets at the end of the lease terms combined with the sale of the assets, with sales proceeds less than the residual value of the leased assets specified in the lease agreements. Residual value guarantees under these operating lease agreements typically range between 7% and 20% of the value of the leased assets at inception of the lease. These leases have original terms ranging from 4 to 8 years and expiration dates ranging from 2018 to 2025. As of June 30, 2018, the undiscounted maximum amount of potential future payments for lease guarantees totaled approximately $26.1 million, which would be mitigated by the fair value of the leased assets at lease expiration. The assessment as to whether it is probable that subsidiaries of the Company will be required to make payments under the terms of the guarantees is based upon their actual and expected loss experience. Consistent with the requirements of FASB ASC 460-10-50, Guarantees-Overall-Disclosure, The Company participates in a purchasing alliance that was formed to obtain better pricing, to expand product options, to reduce internal costs, and to achieve greater inventory turnover. The Company has entered into an agreement to guarantee a portion of the trade payables for such purchasing alliance to their various suppliers as an inducement for these suppliers to extend additional trade credit to the purchasing alliance. In the event of default by the purchasing alliance of their respective trade payables obligations, these suppliers may proceed directly against the Company to collect their trade payables. The terms of this guarantee have an expiration date of June 30, 2019. As of June 30, 2018, the undiscounted maximum amount of potential payments covered by this guarantee totaled $4.0 million. The Company believes that the likelihood of payment under this guarantee is remote and that any fair value attributable to this guarantee is immaterial; therefore, no liability has been recorded for this obligation in the Company’s consolidated balance sheets. In addition, the Company from time to time enters into certain types of contracts that contingently require it to indemnify various parties against claims from third parties. These contracts primarily relate to: (i) certain real estate leases under which subsidiaries of the Company may be required to indemnify property owners for environmental and other liabilities and other claims arising from their use of the applicable premises; (ii) certain agreements with the Company’s officers, directors, and employees under which the Company may be required to indemnify such persons for liabilities arising out of their employment relationship; and (iii) customer agreements under which the Company may be required to indemnify customers for certain claims brought against them with respect to the supplied products. Generally, a maximum obligation under these contracts is not explicitly stated. Because the obligated amounts associated with these types of agreements are not explicitly stated, the overall maximum amount of the obligation cannot be reasonably estimated. Historically, the Company has not been required to make payments under these obligations and, therefore, no liabilities have been recorded for these obligations in the Company’s consolidated balance sheets. Litigation The Company is engaged in various legal proceedings that have arisen but have not been fully adjudicated. The likelihood of loss arising from these legal proceedings, based on definitions within contingency accounting literature, ranges from remote to reasonably possible to probable. When losses are probable and reasonably estimable, they have been accrued. Based on estimates of the range of potential losses associated with these matters, management does not believe that the ultimate resolution of these proceedings, either individually or in the aggregate, will have a material adverse effect upon the consolidated financial position or results of operations of the Company. However, the final results of legal proceedings cannot be predicted with certainty and, if the Company failed to prevail in one or more of these legal matters, and the associated realized losses were to exceed the Company’s current estimates of the range of potential losses, the Company’s consolidated financial position or results of operations could be materially adversely affected in future periods. U.S. Equal Employment Opportunity Commission Lawsuit . In March 2009, the Baltimore Equal Employment Opportunity Commission (“EEOC”) Field Office served us with company-wide (excluding, however, our Vistar and Roma Foodservice operations) subpoenas relating to alleged violations of the Equal Pay Act and Title VII of the Civil Rights Act (“Title VII”), seeking certain information from January 1, 2004 to a specified date in the first fiscal quarter of 2009. In August 2009, the EEOC moved to enforce the subpoenas in federal court in Maryland, and we opposed the motion. In February 2010, the court ruled that the subpoena related to the Equal Pay Act investigation was enforceable company-wide but on a narrower scope of data than the original subpoena sought (the court ruled that the subpoena was applicable to the transportation, logistics, and warehouse functions of our broadline distribution centers only and not to our PFG Customized distribution centers). We cooperated with the EEOC on the production of information. In September 2011, the EEOC notified us that the EEOC was terminating the investigation into alleged violations of the Equal Pay Act. In determinations issued in September 2012 by the EEOC with respect to the charges on which the EEOC had based its company-wide investigation, the EEOC concluded that we engaged in a pattern of denying hiring and promotion to a class of female applicants and employees into certain positions within the transportation, logistics, and warehouse functions within our broadline division in violation of Title VII. In June 2013, the EEOC filed suit in federal court in Baltimore against us. The litigation concerns two issues: (1) whether we unlawfully engaged in an ongoing pattern and practice of failing to hire female applicants into operations positions; and (2) whether we unlawfully failed to promote one of the three individuals who filed charges with the EEOC because of her gender. The EEOC seeks the following relief in the lawsuit: (1) to permanently enjoin us from denying employment to female applicants because of their sex and denying promotions to female employees because of their sex; (2) a court order mandating that we institute and carry out policies, procedures, practices and programs which provide equal employment opportunities for females; (3) back pay with prejudgment interest and compensatory damages for a former female employee and an alleged class of aggrieved female applicants; (4) punitive damages; and (5) costs. The court bifurcated the litigation into two phases. In the first phase, the jury will decide whether we engaged in a gender-based pattern and practice of discrimination and the individual claims of one former employee. If the EEOC prevails on all counts in the first phase, no monetary relief would be awarded, except possibly for the single individual’s claims, which would be immaterial. The remaining individual claims would then be tried in the second phase. At this stage in the proceedings, the Company cannot estimate either the number of individual trials that could occur in the second phase of the litigation or the value of those claims. For these reasons, we are unable to estimate any potential loss or range of loss in the event of an adverse finding in the first and second phases of the litigation. In May 2018, the EEOC filed motions for sanctions against us alleging that we failed to preserve certain paper employment applications and e-mails during 2004 – 2009. In the sanctions motions, the EEOC seeks a range of remedies, including but not limited to, a default judgment against us, or alternatively, an order barring us from filing for summary judgment on the EEOC’s pattern and practice claims. We are opposing the motions and will continue to vigorously defend ourselves. Tax Liabilities The Company is subject to customary audits by authorities in the jurisdictions where it conducts business in the United States, which may result in assessments of additional taxes. |
Related-Party Transactions
Related-Party Transactions | 12 Months Ended |
Jun. 30, 2018 | |
Related Party Transactions [Abstract] | |
Related-Party Transactions | 16. Transaction and Advisory Fee Agreement The Company was a party to an advisory fee agreement pursuant to which affiliates of Blackstone and Wellspring provided management certain strategic and structuring advice and certain monitoring, advising, and consulting services to the Company. The advisory fee agreement provided for the payment by the Company of an annual advisory fee and the reimbursement of out of pocket expenses. The payments made under this agreement totaled $3.0 million, $5.6 million and $5.0 million for fiscal 2018, fiscal 2017, and fiscal 2016, respectively. Under its terms, this agreement terminated on October 6, 2017. Other The Company participates in and has an equity method investment in a purchasing alliance that was formed to obtain better pricing, to expand product options, to reduce internal costs, and to achieve greater inventory turnover. The Company’s investment in the purchasing alliance was $4.3 million as of June 30, 2018 and $4.6 million as of July 1, 2017. For fiscal 2018, fiscal 2017, and fiscal 2016, the Company recorded purchases of $827.9 million, $802.8 million, and $514.8 million, respectively, through the purchasing alliance. |
Earnings Per Share ("EPS")
Earnings Per Share ("EPS") | 12 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share [Abstract] | |
Earnings Per Share ("EPS") | 17. Basic earnings per common share is computed by dividing net income available to common shareholders by the weighted-average number of common shares outstanding during the period. Diluted EPS is calculated using the weighted-average number of common shares and dilutive potential common shares outstanding during the period. In computing diluted EPS, the average closing stock price for the period is used in determining the number of shares assumed to be purchased with the proceeds from the exercise of stock options under the treasury stock method. For fiscal 2018 and fiscal 2017, potential common shares of 0.7 million and 0.6 million, respectively, were not included in computing diluted earnings per share because the effect would have been antidilutive. A reconciliation of the numerators and denominators for the basic and diluted EPS computations is as follows: (In millions, except per share amounts) For the fiscal year ended June 30, 2018 For the fiscal year ended July 1, 2017 For the fiscal year ended July 2, 2016 Numerator: Net Income $ 198.7 $ 96.3 $ 68.3 Denominator: Weighted-average common shares outstanding 102.0 100.2 96.4 Dilutive effect of share-based awards 2.6 2.8 1.7 Weighted-average dilutive shares outstanding 104.6 103.0 98.1 Basic earnings per share $ 1.95 $ 0.96 $ 0.71 Diluted earnings per share $ 1.90 $ 0.93 $ 0.70 |
Stock-based Compensation
Stock-based Compensation | 12 Months Ended |
Jun. 30, 2018 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock-based Compensation | 18. Performance Food Group Company provides compensation benefits to employees and non-employee directors under share-based payment arrangements. These arrangements are designed to promote the long-term growth and profitability of the Company by providing employees and consultants who are or will be involved in the Company’s growth with an opportunity to acquire an ownership interest in the Company, thereby encouraging them to contribute to and participate in the success of the Company. The Performance Food Group Company 2007 Management Option Plan (the “2007 Option Plan”) The 2007 Option Plan allowed for the granting of awards to employees, officers, directors, consultants, and advisors of the Company or its affiliates in the form of nonqualified options. The terms and conditions of awards granted under the 2007 Option Plan were determined by the Board of Directors. The contractual term of the options is ten years. The Company no longer grants awards from this plan. Each of the employee awards under the 2007 Option Plan is divided into three equal portions. Tranche I options are subject to time vesting. Tranche II and Tranche III options are subject to both time and performance vesting, including performance criteria based on the internal rate of return and sponsor cash inflows as outlined in the 2007 Option Plan. Because of the existence of the repurchase rights in the 2007 Option Plan, the weighted average service period initially exceeded the contractual term of the options. The repurchase option feature of this plan terminated upon the date of our IPO and the Company’s management determined that the requisite service period should be reduced from 10.7 years to the 5 year service vesting period. As a result, compensation costs of $3.8 million were recorded in fiscal 2016 related to this change for Tranche I awards. On July 30, 2015, the Company approved amendments to the 2007 Option Plan to modify the vesting terms of all of the Tranche II and Tranche III options granted pursuant to the 2007 Option Plan. Prior to this amendment, the Company’s assessment of the performance criteria indicated that satisfaction of the performance criteria was not probable and therefore, no compensation expense had been recognized for Tranche II and Tranche III options. The time-based vesting condition did not change and will continue to be satisfied with respect to 20% of the shares underlying these options annually, based on the participant’s continued employment with the Company. The performance-based vesting condition was reduced to reflect changes in the macro-economic conditions following the 2008 recession. In addition, as part of the amendments to the 2007 Option Plan, individuals holding these unvested time and performance-vesting options were allowed the right to exercise such options into restricted shares of the Company’s common stock and to receive a new grant of time and performance-vesting options. On September 30, 2015, 3.73 million options were exchanged for 2.27 million restricted shares and 1.46 million new options. On December 7, 2017, Wellspring sold all of their remaining interest in shares of the Company’s common stock and the Company determined that the performance criteria for the Tranche II and III awards had been met, resulting in the vesting of 2.1 million shares of restricted stock and 1.4 million options. In the second quarter of fiscal 2018, the Company recognized approximately $6.3 million of accelerated compensation expense in connection with the vesting of the Tranche II and III awards. Based on the performance achieved, total compensation expense for the Tranche II and III awards was $24.9 million. No Tranche I options were granted from the 2007 Option Plan in fiscal 2018 and 2017. The Company estimated the fair value of the Tranche I time vesting options granted in fiscal 2016 below using a Black-Scholes option pricing model with the following weighted average assumptions: For the fiscal year ended July 2, 2016 Risk-free Interest Rate 1.72 % Dividend Yield 0.00 % Expected Volatility 38.00 % Expected Term (in years) 6.5 Weighted Average Fair Value of Options Granted $ 8.99 The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of grant for the expected holding period. The Company assumed a dividend yield of zero percent when valuing the grants in fiscal 2016 under the 2007 Option Plan because the Company announced that it did not intend to pay dividends on its common stock. Expected volatility is based on the expected volatilities of comparable peer companies that are publicly traded. The expected term represents the period of time that awards granted are expected to be outstanding. For grants in fiscal 2016, the Company elected to use the simplified method to estimate the expected holding period because we did not have sufficient information to understand post vesting exercise behavior. No Tranche II and III options were granted from the 2007 Option Plan in fiscal 2018 and 2017. With the assistance of a specialist, the Company estimated the fair value of the Tranche II and III options and restricted shares with a market condition using a Monte Carlo simulation with the following weighted average assumptions: For the fiscal year ended July 2, 2016 Options Market Condition Restricted Shares Risk-free Interest Rate 1.23 % 1.23 % Dividend Yield 0.00 % 0.00 % Expected Volatility 30.00 % 30.00 % Expected Term (in years) 6.38 2.71 Weighted Average Fair Value of Awards Granted $ 4.20 $ 8.43 The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of grant for the expected holding period. The Company assumed a dividend yield of zero percent when valuing the grants in fiscal 2016 under the 2007 Option Plan because the Company announced that it does not intend to pay dividends on its common stock. Expected volatility is based on the historical equity volatility of comparable peer companies that are publicly traded. This historical equity volatility was un-levered using the company specific capital structure of the comparable peer companies and was re-levered using the capital structure of the Company. The expected term represents the period of time that awards granted are expected to be outstanding, as determined with the assistance of a specialist based on the vesting term and contractual term. In total, compensation cost that has been charged against income for the Company’s 2007 Option Plan was $9.5 million, $6.7 million and $13.2 million for fiscal 2018, fiscal 2017 and fiscal 2016, respectively, and it is included within operating expenses in the consolidated statements of operations. The total income tax benefit recognized in the consolidated statements of operations was $3.1 million, $2.6 million and $5.1 million for fiscal 2018, fiscal 2017 and fiscal 2016, respectively. The total unrecognized compensation cost for all awards under the 2007 Option Plan is $0.8 million as of June 30, 2018. This cost is expected to be recognized over a weighted-average period of 1.7 years. The following table summarizes the stock option activity for fiscal 2018 under the 2007 Option Plan. Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term Aggregate Intrinsic Value (in millions) Outstanding as of July 1, 2017 2,746,041 $ 14.92 Exercised (890,855 ) $ 13.90 Forfeited (68,243 ) $ 19.10 Expired (15,264 ) $ 10.38 Outstanding as of June 30, 2018 1,771,679 $ 15.31 5.26 $ 37.9 Vested or expected to vest as of June 30, 2018 1,771,679 $ 15.31 5.26 $ 37.9 Exercisable as of June 30, 2018 1,567,063 $ 14.81 5.03 $ 34.3 The intrinsic value of exercised options was $17.1 million, $14.4 million, and $5.7 million for fiscal 2018, fiscal 2017, and fiscal 2016, respectively. The following table summarizes the changes in nonvested restricted shares for fiscal 2018 under the 2007 Option Plan. Shares Weighted Average Grant Date Fair Value Nonvested as of July 1, 2017 2,180,278 $ 8.36 Vested (2,124,792 ) $ 8.36 Forfeited (44,260 ) $ 8.35 Nonvested as of June 30, 2018 11,226 $ 8.38 The Performance Food Group Company 2015 Omnibus Incentive Plan (the “2015 Incentive Plan”) In July 2015, the Company approved the 2015 Incentive Plan. The 2015 Incentive Plan allows for the granting of awards to current employees, officers, directors, consultants, and advisors of the Company. The terms and conditions of awards granted under the 2015 Option Plan are determined by the Board of Directors. There are 4,850,000 shares of common stock reserved for issuance under the 2015 Incentive Plan, including non-qualified stock options and incentive stock options, stock appreciation rights, restricted shares (time-based and performance-based), and other equity based or cash-based awards. As of June 30, 2018, there are 2,024,518 shares available for grant under the 2015 Incentive Plan. The contractual term of the options granted under the 2015 Incentive Plan is ten years. Options and time-based restricted shares vest ratably over four years from the date of grant. Performance-based restricted shares vest upon the achievement of a specified Return on Invested Capital (“ROIC”), a performance condition, and a specified Relative Total Shareholder Return (“Relative TSR”), a market condition, at the end of a three year performance period. Actual shares earned range from 0% to 150% of the initial grant, depending upon performance relative to the ROIC and Relative TSR goals. The fair values of time-based restricted shares and restricted shares with a performance condition were based on the Company’s stock price as of the date of grant. With the assistance of a specialist, the fair value of 59,779 restricted shares granted in fiscal 2018 with a market condition was estimated using a Monte Carlo simulation, which approximated 92% of the Company’s stock price on the date of grant. The Company estimated the fair value of options granted in the fiscal years below using a Black-Scholes option pricing model with the following weighted average assumptions: For the fiscal year ended June 30, 2018 For the fiscal year ended July 1, 2017 For the fiscal year ended July 2, 2016 Risk-free Interest Rate 2.00 % 1.30 % 1.56 % Dividend Yield 0.00 % 0.00 % 0.00 % Expected Volatility 32.00 % 33.00 % 37.94 % Expected Term (in years) 6.25 6.25 6.25 Weighted Average Fair Value of Awards Granted $ 10.22 $ 9.10 $ 7.55 The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of grant for the expected holding period. The Company assumed a dividend yield of zero percent when valuing the grants under the 2015 Incentive Plan because the Company announced that it does not intend to pay dividends on its common stock. Expected volatility is based on the expected volatilities of comparable peer companies that are publicly traded. The expected term represents the period of time that awards granted are expected to be outstanding. The Company elected to use the simplified method to estimate the expected holding period because we do not have sufficient information to understand post vesting exercise behavior. As such, we will continue to use this methodology until such time we have sufficient history to provide a reasonable basis on which to estimate the expected term. The compensation cost that has been charged against income for the Company’s 2015 Incentive Plan was $12.1 million for fiscal 2018, $10.6 million for fiscal 2017 and $4.0 million for fiscal 2016, and it is included within operating expenses in the consolidated statement of operations. The total income tax benefit recognized in the consolidated statements of operations was $3.9 million in fiscal 2018, $4.1 million in fiscal 2017, and $1.6 million in fiscal 2016. Total unrecognized compensation cost for all awards under the 2015 Incentive Plan is $26.5 million as of June 30, 2018. This cost is expected to be recognized over a weighted-average period of 2.5 years. The following table summarizes the stock option activity for fiscal 2018 under the 2015 Incentive Plan. Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term Aggregate Intrinsic Value (in millions) Outstanding as of July 1, 2017 574,717 $ 24.62 Granted 323,430 $ 28.80 Exercised (24,491 ) $ 24.24 Forfeited (20,006 ) $ 24.75 Outstanding as of June 30, 2018 853,650 $ 26.21 8.34 $ 9.0 Vested or expected to vest as of June 30, 2018 853,650 $ 26.21 8.44 $ 9.0 Exercisable as of June 30, 2018 148,275 $ 23.60 7.73 $ 1.9 The following table summarizes the changes in nonvested restricted shares and restricted stock units for fiscal 2018 under the 2015 Incentive Plan. Shares Weighted Average Grant Date Fair Value Nonvested as of July 1, 2017 1,110,457 $ 22.50 Granted 578,726 $ 28.64 Vested (282,903 ) $ 21.89 Forfeited (102,402 ) $ 24.13 Nonvested as of June 30, 2018 1,303,878 $ 25.23 The total fair value of shares vested was $8.1 million, $9.2 million, and $0.6 million for fiscal 2018, fiscal 2017, and fiscal 2016, respectively. |
Segment Information
Segment Information | 12 Months Ended |
Jun. 30, 2018 | |
Segment Reporting [Abstract] | |
Segment Information | 19. The Company has three reportable segments, as defined by ASC 280 Segment Reporting Summary of Significant Accounting Policies and Estimates Corporate & All Other is comprised of corporate overhead and certain operations that are not considered separate reportable segments based on their size. This includes the operations of the Company’s internal logistics unit responsible for managing and allocating inbound logistics revenue and expense, as well as the operations of certain recent acquisitions. In the first quarter of fiscal 2018, the Company reorganized its information technology department, and expenses associated with business application teams are now included in the segment results. The EBITDA for Performance Foodservice, Vistar, and Corporate & All Other for the fiscal years ended July 1, 2017 and July 2, 2016 has been adjusted to reflect this change. (In millions) PFS PFG Customized Vistar Corporate & All Other Eliminations Consolidated For fiscal year ended June 30, 2018 Net external sales $ 10,420.4 $ 3,658.1 $ 3,338.5 $ 202.9 $ — $ 17,619.9 Inter-segment sales 10.8 0.4 2.5 246.5 (260.2 ) — Total sales 10,431.2 3,658.5 3,341.0 449.4 (260.2 ) 17,619.9 EBITDA 330.6 29.5 133.1 (109.1 ) — 384.1 Depreciation and amortization 58.7 14.6 27.4 29.4 — 130.1 Capital expenditures 83.8 16.6 18.4 21.3 — 140.1 For fiscal year ended July 1, 2017 Net external sales $ 9,813.3 $ 3,819.5 $ 3,001.0 $ 128.0 $ — $ 16,761.8 Inter-segment sales 9.1 1.3 2.6 219.8 (232.8 ) — Total sales 9,822.4 3,820.8 3,003.6 347.8 (232.8 ) 16,761.8 EBITDA 320.0 25.3 117.7 (124.3 ) — 338.7 Depreciation and amortization 57.4 16.1 24.6 28.0 — 126.1 Capital expenditures 91.6 9.5 6.4 32.7 — 140.2 For fiscal year ended July 2, 2016 Net external sales $ 9,608.9 $ 3,781.1 $ 2,698.8 $ 16.0 $ — $ 16,104.8 Inter-segment sales 7.4 1.0 2.7 204.5 (215.6 ) — Total sales 9,616.3 3,782.1 2,701.5 220.5 (215.6 ) 16,104.8 EBITDA 303.2 34.1 110.1 (130.4 ) — 317.0 Depreciation and amortization 63.2 15.4 18.2 21.8 — 118.6 Capital expenditures 67.5 8.2 13.4 30.6 — 119.7 Total assets by reportable segment, excluding intercompany receivables between segments, are as follows: (In millions) As of June 30, 2018 As of July 1, 2017 PFS $ 2,267.9 $ 2,161.2 PFG Customized 644.3 667.1 Vistar 739.0 654.5 Corporate & All Other 349.7 321.3 Total assets $ 4,000.9 $ 3,804.1 The sales mix for the Company’s principal product and service categories is as follows: (In millions) For the fiscal year ended June 30, 2018 For the fiscal year ended July 1, 2017 For the fiscal year ended July 2, 2016 Center of the plate $ 5,693.4 $ 5,520.5 $ 5,187.5 Frozen foods 2,365.0 2,195.3 2,101.3 Refrigerated and dairy products 2,217.3 2,093.7 2,081.7 Canned and dry groceries 2,205.1 2,146.6 2,172.8 Beverage 1,495.2 1,433.5 1,315.2 Paper products and cleaning supplies 1,351.8 1,291.6 1,241.4 Candy 773.4 706.8 687.2 Snack 730.9 627.2 578.6 Produce 511.1 490.6 507.7 Theater and concession 190.0 156.0 144.2 Merchandising and other services 86.7 100.0 87.2 Total $ 17,619.9 $ 16,761.8 $ 16,104.8 |
Schedule 1 - Registrant's Conde
Schedule 1 - Registrant's Condensed Financial Statements | 12 Months Ended |
Jun. 30, 2018 | |
Condensed Financial Information Of Parent Company Only Disclosure [Abstract] | |
Schedule 1 - Registrant's Condensed Financial Statements | SCHEDULE 1—Registrant’s Condensed Financial Statements PERFORMANCE FOOD GROUP COMPANY Parent Company Only CONDENSED BALANCE SHEETS (In millions per share data) As of June 30, 2018 As of July 1, 2017 ASSETS Current assets: Cash $ — $ — Income tax receivable 11.6 10.7 Total current assets 11.6 10.7 Investment in wholly owned subsidiary 1,184.2 956.2 Total assets $ 1,195.8 $ 966.9 LIABILITIES AND SHAREHOLDERS’ EQUITY Intercompany payable 60.5 41.4 Total liabilities 60.5 41.4 Commitments and contingencies Shareholders’ equity: Common Stock Common Stock: $0.01 par value per share, 1.0 billion shares authorized, 103.2 million shares issued and outstanding as of June 30, 2018; 1.0 billion shares authorized, 100.8 million shares issued and outstanding as of July 1, 2017 1.0 1.0 Additional paid-in capital 861.2 855.5 Retained earnings 273.1 69.0 Total shareholders’ equity 1,135.3 925.5 Total liabilities and shareholders’ equity $ 1,195.8 $ 966.9 See accompanying notes to condensed financial statements. PERFORMANCE FOOD GROUP COMPANY Parent Company Only CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME ($ in millions) Fiscal year ended June 30, 2018 Fiscal year ended July 1, 2017 Fiscal year ended July 2, 2016 Operating expenses $ 3.3 $ 5.8 $ 5.3 Operating loss (3.3 ) (5.8 ) (5.3 ) Income tax benefit (1.0 ) (2.2 ) (1.9 ) Loss before equity in net income of subsidiary (2.3 ) (3.6 ) (3.4 ) Equity in net income of subsidiary, net of tax 201.0 99.9 71.7 Net income 198.7 96.3 68.3 Other comprehensive income (loss) 5.4 8.2 (1.3 ) Total comprehensive income $ 204.1 $ 104.5 $ 67.0 See accompanying notes to condensed financial statements. PERFORMANCE FOOD GROUP COMPANY Parent Company Only CONDENSED STATEMENTS OF CASH FLOWS ($ in millions) Fiscal year ended June 30, 2018 Fiscal year ended July 1, 2017 Fiscal year ended July 2, 2016 Cash flows from operating activities: Net income $ 198.7 $ 96.3 $ 68.3 Adjustments to reconcile net income to net cash provided by (used in) operating activities Equity in net income of subsidiary (201.0 ) (99.9 ) (71.7 ) Changes in operating assets and liabilities, net Intercompany payables 19.1 5.2 7.9 Income tax receivable (0.9 ) (2.1 ) (1.9 ) Net cash provided by (used in) operating activities 15.9 (0.5 ) 2.6 Cash flows from investing activities: Capital contributed to subsidiary — — (229.4 ) Net cash used in investing activities — — (229.4 ) Cash flows from financing activities: Proceeds from exercise of stock options 12.3 4.0 1.3 Net proceeds from initial public offering — — 226.4 Cash paid for shares withheld to cover taxes (28.2 ) (3.5 ) (0.9 ) Net cash (used in) provided by financing activities (15.9 ) 0.5 226.8 Net (decrease) increase in cash and restricted cash (1) — — — Cash and restricted cash, beginning of period (1) — — — Cash and restricted cash, end of period (1) $ — $ — $ — (1) The condensed statements of cash flows for the fiscal years ended July 1, 2017 and July 2, 2016 have been adjusted to reflect the adoption of ASU 2016-08, Statement of Cash Flows (Topic 230): Restricted Cash See accompanying notes to condensed financial statements. 1. Description of Performance Food Group Company Performance Food Group Company (the “Parent”) was incorporated in Delaware on July 23, 2002 to effect the purchase of all the outstanding equity interests of PFGC, Inc. (“PFGC”). The Parent has no significant operations or significant assets or liabilities other than its investment in PFGC. Accordingly, the Parent is dependent upon distributions from PFGC to fund its obligations. However, under the terms of PFGC’s various debt agreements, PFGC’s ability to pay dividends or lend to the Parent is restricted, except that PFGC may pay specified amounts to the Parent to fund the payment of the Parent’s franchise and excise taxes and other fees, taxes, and expenses required to maintain its corporate existence. 2. Basis of Presentation The accompanying condensed financial statements (parent company only) include the accounts of the Parent and its investment in PFGC, Inc. accounted for in accordance with the equity method, and do not present the financial statements of the Parent and its subsidiary on a consolidated basis. These parent company only financial statements should be read in conjunction with the Performance Food Group Company consolidated financial statements. The Parent is included in the consolidated federal and certain unitary, consolidated and combined state income tax returns with its subsidiaries. The Parent’s tax balances reflect its share of such filings. |
Summary of Significant Accoun30
Summary of Significant Accounting Policies and Estimates (Policies) | 12 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of the Company and its subsidiaries. All inter-company balances and transactions have been eliminated. |
Use of Estimates | Use of Estimates The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. The most significant estimates used by management are related to the accounting for the allowance for doubtful accounts, reserve for inventories, impairment testing of goodwill and other intangible assets, acquisition accounting, reserves for claims and recoveries under insurance programs, vendor rebates and other promotional incentives, bonus accruals, depreciation, amortization, determination of useful lives of tangible and intangible assets, and income taxes. Actual results could differ from these estimates. |
Cash | Cash The Company maintains its cash primarily in institutions insured by the Federal Deposit Insurance Corporation (“FDIC”). At times, the Company’s cash balance may be in amounts that exceed the FDIC insurance limits. |
Restricted Cash | Restricted Cash The Company is required by its insurers to collateralize a part of the deductibles for its workers’ compensation and liability claims. The Company has chosen to satisfy these collateral requirements primarily by depositing funds in trusts or by issuing letters of credit. All amounts in restricted cash at June 30, 2018 and July 1, 2017 represent funds deposited in insurance trusts, and $10.3 |
Accounts Receivable | Accounts Receivable Accounts receivable are comprised of trade receivables from customers in the ordinary course of business, are recorded at the invoiced amount, and primarily do not bear interest. Accounts receivable also includes other receivables primarily related to various rebate and promotional incentives with the Company’s suppliers. Receivables are recorded net of the allowance for doubtful accounts on the accompanying consolidated balance sheets. The Company evaluates the collectability of its accounts receivable based on a combination of factors. The Company regularly analyzes its significant customer accounts, and when it becomes aware of a specific customer’s inability to meet its financial obligations to the Company, such as bankruptcy filings or deterioration in the customer’s operating results or financial position, the Company records a specific reserve for bad debt to reduce the related receivable to the amount it reasonably believes is collectible. The Company also records reserves for bad debt for other customers based on a variety of factors, including the length of time the receivables are past due, macroeconomic considerations, and historical experience. If circumstances related to specific customers change, the Company’s estimates of the recoverability of receivables could be further adjusted. As of June 30, 2018 and July 1, 2017, the allowance for doubtful accounts related to trade receivables was approximately $11.5 million and $11.0 million, respectively, and $7.8 million and $6.0 million, respectively related to other receivables. The Company recorded $12.1 million, $6.0 million, and $7.5 million in provision for doubtful accounts in fiscal 2018, fiscal 2017, and fiscal 2016, respectively. |
Inventories | Inventories The Company’s inventories consist primarily of food and non-food products. The Company values inventories primarily at the lower of cost or market using the first-in, first-out (“FIFO”) method. At June 30, 2018, the Company’s inventory balance of $1,051.9 million consists primarily of finished goods, $954.8 million of which was valued at FIFO. As of June 30, 2018, $97.1 million of the inventory balance was valued at last-in, first-out (“LIFO”) using the link chain technique of the dollar value method. At June 30, 2018 and July 1, 2017, the LIFO balance sheet reserves were $6.9 million and $6.6 million, respectively. Costs in inventory include the purchase price of the product and freight charges to deliver the product to the Company’s warehouses and are net of certain consideration received from vendors in the amount of $24.3 million and $22.9 million as of June 30, 2018 and July 1, 2017, respectively. The Company adjusts its inventory balances for slow-moving, excess, and obsolete inventories. These adjustments are based upon inventory category, inventory age, specifically identified items, and overall economic conditions. As of June 30, 2018 and July 1, 2017, the Company had adjusted its inventories by approximately $4.0 million and $4.5 million, respectively. |
Property, Plant, and Equipment | Property, Plant, and Equipment Property, plant, and equipment are stated at cost. Depreciation of property, plant and equipment, including capital lease assets, is calculated primarily using the straight-line method over the estimated useful lives of the assets, which range from two to 39 years, and is included primarily in operating expenses on the consolidated statement of operations. Certain internal and external costs related to the development of internal use software are capitalized within property, plant, and equipment during the application development stage. When assets are retired or otherwise disposed, the costs and related accumulated depreciation are removed from the accounts. The difference between the net book value of the asset and proceeds from disposition is recognized as a gain or loss. Routine maintenance and repairs are charged to expense as incurred, while costs of betterments and renewals are capitalized. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets Long-lived assets held and used by the Company, including intangible assets with definite lives, are tested for recoverability whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. For purposes of evaluating the recoverability of long-lived assets, the Company compares the carrying value of the asset or asset group to the projected, undiscounted future cash flows expected to be generated by the long-lived asset or asset group. Based on the Company’s assessments, no impairment losses were recorded in fiscal 2018, fiscal 2017, or fiscal 2016. |
Acquisitions, Goodwill, and Other Intangible Assets | Acquisitions, Goodwill, and Other Intangible Assets The Company accounts for acquired businesses using the acquisition method of accounting. The Company’s financial statements reflect the operations of an acquired business starting from the completion of the acquisition. Goodwill and other intangible assets represent the excess of cost of an acquired entity over the amounts specifically assigned to those tangible net assets acquired in a business combination. Other identifiable intangible assets typically include customer relationships, trade names, technology, non-compete agreements, and favorable lease assets. Goodwill and intangibles with indefinite lives are not amortized. Intangibles with definite lives are amortized on a straight-line basis over their useful lives, which generally range from two to eleven years. Annually, or when certain triggering events occur, the Company assesses the useful lives of its intangibles with definite lives. Certain assumptions, estimates, and judgments are used in determining the fair value of net assets acquired, including goodwill and other intangible assets, as well as determining the allocation of goodwill to the reporting units. Accordingly, the Company may obtain the assistance of third-party valuation specialists for the valuation of significant tangible and intangible assets. The fair value estimates are based on available historical information and on future expectations and assumptions deemed reasonable by management but that are inherently uncertain. Significant estimates and assumptions inherent in the valuations reflect a consideration of other marketplace participants and include the amount and timing of future cash flows (including expected growth rates and profitability), economic barriers to entry, a brand’s relative market position, and the discount rate applied to the cash flows. Unanticipated market or macroeconomic events and circumstances may occur that could affect the accuracy or validity of the estimates and assumptions. The Company is required to test goodwill and other intangible assets with indefinite lives for impairment annually, or more often if circumstances indicate. Indicators of goodwill impairment include, but are not limited to, significant declines in the markets and industries that buy the Company’s products, changes in the estimated future cash flows of its reporting units, changes in capital markets, and changes in its market capitalization. For goodwill and indefinite-lived intangible assets, the Company’s policy is to assess impairment at the end of each fiscal year. The Company applies the guidance in Financial Accounting Standards Board (“FASB”) Accounting Standards Update (“ASU”) 2011-08 “Intangibles—Goodwill and Other—Testing Goodwill for Impairment During fiscal 2018 and fiscal 2017, the Company performed the step zero analysis for its goodwill impairment test. As a result of the Company’s step zero analysis, no further quantitative impairment test was deemed necessary for fiscal 2018 and fiscal 2017. There were no impairments of goodwill or intangible assets with indefinite lives for fiscal 2018, fiscal 2017, or fiscal 2016. |
Insurance Program | Insurance Program The Company maintains high-deductible insurance programs covering portions of general and vehicle liability and workers’ compensation. The amounts in excess of the deductibles are fully insured by third-party insurance carriers and subject to certain limitations and exclusions. The Company also maintains self-funded group medical insurance. The Company accrues its estimated liability for these deductibles, including an estimate for incurred but not reported claims, based on known claims and past claims history. The estimated short-term portion of these accruals is included in Accrued expenses on the Company’s consolidated balance sheets, while the estimated long-term portion of the accruals is included in Other long-term liabilities. The provisions for insurance claims include estimates of the frequency and timing of claims occurrence, as well as the ultimate amounts to be paid. These insurance programs are managed by a third party, and the deductibles for general and vehicle liability and workers compensation are primarily collateralized by letters of credit and restricted cash. |
Other Comprehensive Income (Loss) (“OCI”) | Other Comprehensive Income (Loss) (“OCI”) Other comprehensive income (loss) is defined as all changes in equity during each period except for those resulting from net income (loss) and investments by or distributions to shareholders. Other comprehensive income (loss) consists primarily of gains or losses from derivative financial instruments that are designated in a hedging relationship. For derivative instruments that qualify as cash flow hedges, the effective portion of the gain or loss on the derivative instrument is reported as a component of other comprehensive income and reclassified into earnings during the same period or periods during which the hedged transaction affects earnings. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue from the sale of a product when it is considered realized or realizable and earned. The Company determines these requirements to be met when the product has been delivered to the customer, the price is fixed and determinable, and there is reasonable assurance of collection of the sales proceeds. The Company grants certain customers sales incentives such as rebates or discounts and treats these as a reduction of sales at the time the sale is recognized. The Company recognizes revenues net of applicable sales tax. Sales returns are recorded as reductions of sales. Revenue is accounted for in accordance with FASB ASC 605-45, “ Reporting Revenue Gross as a Principal versus Net as an Agent • who is the primary obligor to provide the product or services desired by our customers; • who has discretion in supplier selection; • who has latitude in establishing price; • who retains credit risk; and • who bears inventory risk. When the Company determines that it does not meet the criteria for gross revenue recognition under ASC 605-45 on the basis of these factors, the Company reports the revenue on a net basis. When there is a change to an agreement with a customer or vendor, pursuant to the Company’s revenue recognition policy, the Company reevaluates the reporting of the revenue based on the factors outlined above to determine if there has been a change in the Company’s relationship in acting as the principal or an agent. |
Cost of Goods Sold | Cost of Goods Sold Cost of goods sold includes amounts paid to manufacturers for products sold, the cost of transportation necessary to bring the products to the Company’s facilities, plus depreciation related to processing facilities and equipment. |
Operating Expenses | Operating Expenses Operating expenses include warehouse, delivery, occupancy, insurance, depreciation, amortization, salaries and wages, and employee benefits expenses. |
Vendor Rebates and Other Promotional Incentives | Vendor Rebates and Other Promotional Incentives The Company participates in various rebate and promotional incentives with its suppliers, primarily including volume and growth rebates, annual and multi-year incentives, and promotional programs. Consideration received under these incentives is generally recorded as a reduction of cost of goods sold. However, as described below, in certain limited circumstances the consideration is recorded as a reduction of operating expenses incurred by the Company. Consideration received may be in the form of cash and/or invoice deductions. Changes in the estimated amount of incentives to be received are treated as changes in estimates and are recognized in the period of change. Consideration received for incentives that contain volume and growth rebates and annual and multi-year incentives are recorded as a reduction of cost of goods sold. The Company systematically and rationally allocates the consideration for these incentives to each of the underlying transactions that results in progress by the Company toward earning the incentives. If the incentives are not probable and reasonably estimable, the Company records the incentives as the underlying objectives or milestones are achieved. The Company records annual and multi-year incentives when earned, generally over the agreement period. The Company uses current and historical purchasing data, forecasted purchasing volumes, and other factors in estimating whether the underlying objectives or milestones will be achieved. Consideration received to promote and sell the supplier’s products is typically a reimbursement of marketing costs incurred by the Company and is recorded as a reduction of the Company’s operating expenses. If the amount of consideration received from the suppliers exceeds the Company’s marketing costs, any excess is recorded as a reduction of cost of goods sold. The Company follows the requirements of FASB ASC 605-50-25-10, Revenue Recognition—Customer Payments and Incentives—Recognition—Customer’s Accounting for Certain Consideration Received from a Vendor Revenue Recognition—Customer Payments and Incentives—Other Presentation Matters—Reseller’s Characterization of Sales Incentives Offered to Customers by Manufacturers |
Shipping and Handling Fees and Costs | Shipping and Handling Fees and Costs Shipping and handling fees billed to customers are included in net sales. Estimated shipping and handling costs incurred by the Company of $884.5 million, $807.7 million, and $752.0 million are recorded in operating expenses in the consolidated statement of operations for fiscal 2018, fiscal 2017, and fiscal 2016, respectively. |
Stock-Based Compensation | Stock-Based Compensation The Company participates in the Performance Food Group Company 2007 Management Option Plan (the “2007 Option Plan”) and the Performance Food Group Company 2015 Omnibus Incentive Plan (the “2015 Incentive Plan”) and follows the fair value recognition provisions of FASB ASC 718-10-25, Compensation—Stock Compensation—Overall—Recognition |
Income Taxes | Income Taxes The Company follows FASB ASC 740-10, Income Taxes—Overall |
Derivative Instruments and Hedging Activities | Derivative Instruments and Hedging Activities As required by FASB ASC 815-20, Derivatives and Hedging—Hedging—General Derivatives and Hedging Activities The Company discloses derivative instruments and hedging activities in accordance with FASB ASC 815-10-50, Derivatives and Hedging—Overall—Disclosure |
Fair Value Measurements | Fair Value Measurements Fair value is defined as an exit price, representing the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The accounting guidance establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The three levels of the fair value hierarchy are as follows: • Level 1—Observable inputs such as quoted prices for identical assets or liabilities in active markets; • Level 2—Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly for substantially the full term of the asset or liability; and • Level 3—Unobservable inputs in which there are little or no market data, which include management’s own assumption about the risk assumptions market participants would use in pricing an asset or liability. The Company’s derivative instruments are carried at fair value and are evaluated in accordance with this hierarchy. |
Contingent Liabilities | Contingent Liabilities The Company records a liability related to contingencies when a loss is considered to be probable and a reasonable estimate of the loss can be made. This estimate would include legal fees, if applicable. |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements In July 2015, the FASB issued ASU 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments Based on our review of the ASU, the Company concluded that it has historically classified the specified cash receipts and cash payments in accordance with the clarified guidance. This ASU did not have a material impact on the Company’s consolidated financial statements. In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash for the fiscal years ended July 1, 2017 and July 2, 2016 include restricted cash with cash when reconciling the beginning-of-period and end-of-period total amounts. As a result of the adoption of ASU 2016-18, cash payments of $7.3 million in fiscal 2016 related to insurance claims paid using restricted cash is classified as a change in Accrued expenses and other liabilities within Net cash provided by operating activities. In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment In February 2018, the FASB issued ASU 2018-02, Income Statement—Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income Recently Issued Accounting Pronouncements Not Yet Adopted In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) The Company adopted this standard at the beginning of fiscal year 2019 using the modified retrospective approach. The Company has completed its analysis of the new standard and determined that the Company’s customer contracts include one performance obligation which is satisfied once the products are delivered to the customer. Revenue will be recognized at the point in time in which the Company transfers control of the products to the customer. This is consistent with the Company’s current practice of recognizing revenue upon delivery to the customer. For the first quarter of fiscal 2019, the Company will be required to make enhanced revenue disclosures, which will include relevant information about contracts with customers, disaggregated revenues, performance obligations and other items requiring significant judgments and estimates used to recognize revenue. The Company has revised its relevant policies and procedures, as applicable, to meet the new accounting, reporting and disclosure requirements of Topic 606 and has updated internal controls accordingly. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) Leases (Topic 842): Targeted Improvements In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities. |
Business Combinations (Tables)
Business Combinations (Tables) | 12 Months Ended |
Jun. 30, 2018 | |
Business Combinations [Abstract] | |
Summary of Preliminary Purchase Price Allocation of Major Class of Assets Acquired and Liabilities Assumed | The following table summarizes the preliminary purchase price allocation for each major class of assets acquired and liabilities assumed for the fiscal 2018 acquisitions. (In millions) Fiscal 2018 Net working capital $ 24.9 Goodwill 21.3 Other intangible assets 24.7 Property, plant and equipment 1.8 Total purchase price $ 72.7 |
Goodwill and Other Intangible32
Goodwill and Other Intangible Assets (Tables) | 12 Months Ended |
Jun. 30, 2018 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Changes in Carrying Amount of Goodwill | The following table presents the changes in the carrying amount of goodwill: (In millions) Performance Foodservice PFG Customized Vistar Other Total Balance as of July 2, 2016 $ 405.3 $ 166.5 $ 63.0 $ 39.2 $ 674.0 Acquisitions—current year 22.9 — 2.3 19.8 45.0 Adjustment related to prior year acquisitions — — (0.4 ) — (0.4 ) Balance as of July 1, 2017 428.2 166.5 64.9 59.0 718.6 Acquisitions—current year — — 21.3 — 21.3 Adjustment related to prior year acquisitions 0.3 — — 0.3 0.6 Balance as of June 30, 2018 $ 428.5 $ 166.5 $ 86.2 $ 59.3 $ 740.5 |
Schedule of Intangible Assets by Major Category | The following table presents the Company’s intangible assets by major category as of June 30, 2018 and July 1, 2017: As of June 30, 2018 As of July 1, 2017 (In millions) Gross Carrying Amount Accumulated Amortization Net Gross Carrying Amount Accumulated Amortization Net Range of Lives Intangible assets with definite lives: Customer relationships $ 477.3 $ (360.4 ) $ 116.9 $ 457.0 $ (337.4 ) $ 119.6 4 – 11 years Trade names and trademarks 106.0 (95.4 ) 10.6 106.0 (92.3 ) 13.7 4 – 9 years Deferred financing costs 45.5 (38.0 ) 7.5 44.2 (35.2 ) 9.0 Debt term Non-compete 31.2 (17.8 ) 13.4 26.8 (14.0 ) 12.8 2 – 5 years Leases 12.5 (6.6 ) 5.9 12.5 (6.0 ) 6.5 Lease term Technology 26.1 (26.1 ) — 26.1 (26.1 ) — 5 – 7 years Total intangible assets with definite lives $ 698.6 $ (544.3 ) $ 154.3 $ 672.6 $ (511.0 ) $ 161.6 Intangible assets with indefinite lives: Goodwill $ 740.5 $ — $ 740.5 $ 718.6 $ — $ 718.6 Indefinite Trade names 39.5 — 39.5 39.5 — 39.5 Indefinite Total intangible assets with indefinite lives $ 780.0 $ — $ 780.0 $ 758.1 $ — $ 758.1 |
Estimated Future Amortization Expense on Intangible Assets | For the next five fiscal periods and thereafter, the estimated future amortization expense on intangible assets with definite lives are as follows: (In millions) 2019 $ 33.7 2020 30.4 2021 29.4 2022 24.2 2023 12.4 Thereafter 24.2 Total amortization expense $ 154.3 |
Property, Plant, and Equipment
Property, Plant, and Equipment (Tables) | 12 Months Ended |
Jun. 30, 2018 | |
Property Plant And Equipment [Abstract] | |
Summary of Property Plant and Equipment | Property, plant, and equipment as of June 30, 2018 and July 1, 2017 consisted of the following: (In millions) As of June 30, 2018 As of July 1, 2017 Range of Lives Buildings and building improvements $ 477.1 $ 452.7 10 – 39 years Land 48.7 47.9 — Transportation equipment 152.6 136.4 2 – 10 years Warehouse and plant equipment 257.5 242.3 3 – 20 years Office equipment, furniture, and fixtures 279.7 247.8 2 – 10 years Leasehold improvements 114.0 108.3 Lease term(1) Construction-in-process 85.2 50.8 1,414.8 1,286.2 Less: accumulated depreciation and amortization (619.3 ) (545.5 ) Property, plant and equipment, net $ 795.5 $ 740.7 (1) Leasehold improvements are depreciated over the shorter of the useful life of the asset or the lease term. |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Jun. 30, 2018 | |
Schedule of Debt | Debt consisted of the following: (In millions) As of June 30, 2018 As of July 1, 2017 ABL Facility $ 780.1 $ 899.9 5.500% Notes due 2024 350.0 350.0 Promissory Note — 6.0 Less: Original issue discount and deferred financing costs (7.1 ) (8.2 ) Long-term debt 1,123.0 1,247.7 Capital and finance lease obligations 61.2 49.9 Total debt 1,184.2 1,297.6 Less: current installments (8.4 ) (11.7 ) Total debt, excluding current installments $ 1,175.8 $ 1,285.9 |
Schedule of Fiscal Year Maturities of Long-Term Debt, Excluding Capital and Finance Lease Obligations | Fiscal year maturities of long-term debt, excluding capital and finance lease obligations, are as follows: (In millions) 2019 $ — 2020 — 2021 780.1 2022 — 2023 — Thereafter 350.0 Total long-term debt, excluding capital and finance lease obligations $ 1,130.1 |
Schedule of Future Minimum Lease Payments under Non-cancelable Capital Lease Obligations | Future minimum lease payments under non-cancelable capital lease obligations were as follows as of June 30, 2018: (In millions) Capital Leases 2019 $ 12.1 2020 10.0 2021 9.6 2022 9.4 2023 8.3 Thereafter 33.5 Total future minimum lease payments 82.9 Less: interest 21.7 Present value of future minimum lease payments $ 61.2 |
ABL Facility [Member] | |
Summary of Outstanding Borrowings, Availability, and Average Interest Rate | The following table summarizes outstanding borrowings, availability, and the average interest rate under the ABL Facility: (Dollars in millions) As of June 30, 2018 As of July 1, 2017 Aggregate borrowings $ 780.1 $ 899.9 Letters of credit 121.3 105.5 Excess availability, net of lenders’ reserves of $12.1 and $11.2, respectively 854.2 594.6 Average interest rate 3.52 % 2.59 % |
Derivatives and Hedging Activ35
Derivatives and Hedging Activities (Tables) | 12 Months Ended |
Jun. 30, 2018 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Schedule of Outstanding Swap Agreements | The following table summarizes the outstanding Swap Agreements as of June 30, 2018 (in millions): Effective Date Maturity Date Notional Amount Fixed Rate Swapped August 9, 2013 August 9, 2018 $ 200.0 1.51 % June 30, 2017 June 30, 2019 50.0 1.13 % June 30, 2017 June 30, 2020 50.0 1.23 % June 30, 2017 June 30, 2020 50.0 1.25 % June 30, 2017 June 30, 2020 50.0 1.26 % August 9, 2018 August 9, 2021 75.0 1.21 % August 9, 2018 August 9, 2021 75.0 1.20 % June 30, 2020 December 31, 2021 100.0 2.16 % |
Effect of Interest Rate Swaps Designated in Hedging Relationships on Consolidated Statement of Operations | The tables below present the effect of the interest rate swaps designated in hedging relationships on the consolidated statement of operations for the fiscal years ended June 30, 2018, July 1, 2017 and July 2, 2016: (in millions) Fiscal year ended June 30, 2018 Fiscal year ended July 1, 2017 Fiscal year ended July 2, 2016 Amount of (gain) loss recognized in OCI, pre-tax $ (7.9 ) $ (9.3 ) $ 9.3 Tax expense (benefit) 2.1 3.6 (3.6 ) Amount of (gain) loss recognized in OCI, after-tax $ (5.8 ) $ (5.7 ) $ 5.7 Amount of gain (loss) reclassified from OCI into interest expense, pre-tax $ 0.6 $ (4.0 ) $ (7.3 ) Tax (expense) benefit (0.2 ) 1.5 2.9 Amount of gain (loss) reclassified from OCI into interest expense, after-tax $ 0.4 $ (2.5 ) $ (4.4 ) |
Summary of Fair Value of Derivative Financial Instruments | The Company does not currently have a payable or receivable related to cash collateral for its derivatives, and therefore it has not established an accounting policy for offsetting the fair value of its derivatives against such balances. The table below presents the fair value of the derivative financial instruments as well as their classification on the balance sheet as of June 30, 2018 and July 1, 2017: (in millions) Balance Sheet Location Fair Value as of June 30, 2018 Fair Value as of July 1, 2017 Assets Derivatives designated as hedges: Interest rate swaps Prepaid expenses and other current assets $ 4.0 $ 0.3 Interest rate swaps Other assets 8.4 5.0 Derivatives not designated as hedges: Diesel fuel collars Prepaid expenses and other current assets 0.1 — Total assets $ 12.5 $ 5.3 Liabilities Derivatives designated as hedges: Interest rate swaps Accrued expenses and other current liabilities $ — $ 0.3 Total liabilities $ — $ 0.3 |
Summary of Derivative Assets and Liability Balance by Type of Financial Instrument Before and After Effects of Offsetting | The tables below present the derivative assets and liability balance, before and after the effects of offsetting, as of June 30, 2018 and July 1, 2017: June 30, 2018 July 1, 2017 (In millions) Gross Amounts Presented in the Consolidated Balance Sheet Gross Amounts Not Offset in the Balance Sheet Subject to Netting Agreements Net Amounts Gross Amounts Presented in the Consolidated Balance Sheet Gross Amounts Not Offset in the Consolidated Balance Sheet Subject to Netting Agreements Net Amounts Total asset derivatives: $ 12.5 $ — $ 12.5 $ 5.3 $ — $ 5.3 Total liability derivatives: — — — 0.3 — 0.3 |
Insurance Program Liabilities (
Insurance Program Liabilities (Tables) | 12 Months Ended |
Jun. 30, 2018 | |
Insurance [Abstract] | |
Summary of Activity in All Types of Deductible Insurance Program Liabilities | A summary of the activity in all types of deductible liabilities appears below: (In millions) Balance at June 27, 2015 $ 84.0 Charged to costs and expenses 146.7 Payments (143.4 ) Balance at July 2, 2016 $ 87.3 Charged to costs and expenses 165.2 Payments (154.7 ) Balance at July 1, 2017 $ 97.8 Charged to costs and expenses 164.5 Payments (154.9 ) Balance at June 30, 2018 $ 107.4 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Jun. 30, 2018 | |
Leases [Abstract] | |
Schedule of Future Minimum Lease Payments Under Operating Agreement | As of June 30, 2018, subsidiaries of the Company are obligated under non-cancelable operating lease agreements to make future minimum lease payments as follows: (In millions) 2019 $ 91.5 2020 81.2 2021 65.6 2022 52.9 2023 39.7 Thereafter 119.5 Total minimum lease payments $ 450.4 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Jun. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income Tax Expense | Income tax expense for fiscal 2018, fiscal 2017 and fiscal 2016 consisted of the following: (In millions) For the fiscal year ended June 30, 2018 For the fiscal year ended July 1, 2017 For the fiscal year ended July 2, 2016 Current income tax (benefit) expense: Federal $ (8.6 ) $ 45.8 $ 40.2 State 2.1 9.3 6.4 Total current income tax (benefit) expense (6.5 ) 55.1 46.6 Deferred income tax (benefit) expense: Federal (7.2 ) 3.6 (1.1 ) State 8.6 2.7 0.7 Total deferred income tax expense (benefit) 1.4 6.3 (0.4 ) Total income tax (benefit) expense, net $ (5.1 ) $ 61.4 $ 46.2 |
Schedule of Effective Income Tax Rate from Continuing Operation | Actual income tax (benefit) expense differs from the amount computed by applying the applicable U.S. federal statutory corporate income tax rate of 28% in fiscal 2018 and 35% in fiscal 2017 and fiscal 2016 to earnings before income taxes as follows: (In millions) For the fiscal year ended June 30, 2018 For the fiscal year ended July 1, 2017 For the fiscal year ended July 2, 2016 Federal income tax expense computed at statutory rate $ 54.3 $ 55.2 $ 40.0 Increase (decrease) in income taxes resulting from: State income taxes, net of federal income tax benefit 10.4 7.5 4.8 Non-deductible expenses and other 1.7 3.4 2.7 Tax law change (50.4 ) — — Stock-based compensation (20.6 ) (4.7 ) (1.3 ) Other (0.5 ) — — Total income tax (benefit) expense, net $ (5.1 ) $ 61.4 $ 46.2 The impact to the provision for stock-based compensation and the impact of the reduction in tax rate under the Act are summarized as follows: Fiscal year ended June 30, 2018 (Dollars in millions) Income Tax Expense Effective Tax Rate Income tax (benefit), reported $ (5.1 ) -2.6 % Revaluation of net deferred income tax liability 38.5 19.9 % Other impact of tax law change 11.9 6.1 % Stock-based compensation - performance vesting 15.4 8.0 % Income tax expense, excluding benefits $ 60.7 31.4 % |
Schedule of Significant Deferred Tax Assets and Liabilities | Temporary differences and carry-forwards that created significant deferred tax assets and liabilities were as follows: (In millions) As of June 30, 2018 As of July 1, 2017 Deferred tax assets: Allowance for doubtful accounts $ 3.1 $ 4.0 Inventories 4.3 7.0 Accrued employee benefits 6.9 9.8 Self-insurance reserves 1.6 2.5 Net operating loss carry-forwards 5.8 4.2 Stock-based compensation 6.4 12.0 Deferred rent 0.6 1.0 Other assets 0.9 2.6 Total gross deferred tax assets 29.6 43.1 Less: Valuation allowance (0.4 ) — Total net deferred tax assets 29.2 43.1 Deferred tax liabilities: Property, plant, and equipment 82.8 86.8 Other comprehensive income 2.9 1.5 Basis difference in intangible assets 34.1 51.1 Prepaid expenses 15.6 6.5 Other 0.1 0.2 Total deferred tax liabilities 135.5 146.1 Total net deferred income tax liability $ 106.3 $ 103.0 |
Summary of Activity Related to Unrecognized Tax Benefits | The following table summarizes the activity related to unrecognized tax benefits: (In millions) Balance as of June 27, 2015 $ 0.9 Increases due to current year positions — Settlements with taxing authorities (0.1 ) Expiration of statutes of limitations (0.4 ) Balance as of July 2, 2016 0.4 Increases due to current year positions 0.5 Increases due to prior years positions 0.6 Expiration of statutes of limitations (0.2 ) Balance as of July 1, 2017 1.3 Increases due to current year positions 0.2 Decreases due to prior years positions (0.2 ) Expiration of statutes of limitations (0.1 ) Balance as of June 30, 2018 $ 1.2 |
Earnings Per Share ("EPS") (Tab
Earnings Per Share ("EPS") (Tables) | 12 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share [Abstract] | |
Schedule of Reconciliation of Numerators and Denominators for Basic and Diluted Earnings Per Share Computations | A reconciliation of the numerators and denominators for the basic and diluted EPS computations is as follows: (In millions, except per share amounts) For the fiscal year ended June 30, 2018 For the fiscal year ended July 1, 2017 For the fiscal year ended July 2, 2016 Numerator: Net Income $ 198.7 $ 96.3 $ 68.3 Denominator: Weighted-average common shares outstanding 102.0 100.2 96.4 Dilutive effect of share-based awards 2.6 2.8 1.7 Weighted-average dilutive shares outstanding 104.6 103.0 98.1 Basic earnings per share $ 1.95 $ 0.96 $ 0.71 Diluted earnings per share $ 1.90 $ 0.93 $ 0.70 |
Stock-based Compensation (Table
Stock-based Compensation (Tables) | 12 Months Ended |
Jun. 30, 2018 | |
2007 Option Plan [Member] | |
Summary of Stock Option Activity | The following table summarizes the stock option activity for fiscal 2018 under the 2007 Option Plan. Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term Aggregate Intrinsic Value (in millions) Outstanding as of July 1, 2017 2,746,041 $ 14.92 Exercised (890,855 ) $ 13.90 Forfeited (68,243 ) $ 19.10 Expired (15,264 ) $ 10.38 Outstanding as of June 30, 2018 1,771,679 $ 15.31 5.26 $ 37.9 Vested or expected to vest as of June 30, 2018 1,771,679 $ 15.31 5.26 $ 37.9 Exercisable as of June 30, 2018 1,567,063 $ 14.81 5.03 $ 34.3 |
Summary of Changes in Nonvested Restricted Shares | The following table summarizes the changes in nonvested restricted shares for fiscal 2018 under the 2007 Option Plan. Shares Weighted Average Grant Date Fair Value Nonvested as of July 1, 2017 2,180,278 $ 8.36 Vested (2,124,792 ) $ 8.36 Forfeited (44,260 ) $ 8.35 Nonvested as of June 30, 2018 11,226 $ 8.38 |
2007 Option Plan [Member] | Tranche One [Member] | |
Summary of Weighted Average Assumptions | The Company estimated the fair value of the Tranche I time vesting options granted in fiscal 2016 below using a Black-Scholes option pricing model with the following weighted average assumptions: For the fiscal year ended July 2, 2016 Risk-free Interest Rate 1.72 % Dividend Yield 0.00 % Expected Volatility 38.00 % Expected Term (in years) 6.5 Weighted Average Fair Value of Options Granted $ 8.99 |
2007 Option Plan [Member] | Tranche Two and Three [Member] | |
Summary of Weighted Average Assumptions | With the assistance of a specialist, the Company estimated the fair value of the Tranche II and III options and restricted shares with a market condition using a Monte Carlo simulation with the following weighted average assumptions: For the fiscal year ended July 2, 2016 Options Market Condition Restricted Shares Risk-free Interest Rate 1.23 % 1.23 % Dividend Yield 0.00 % 0.00 % Expected Volatility 30.00 % 30.00 % Expected Term (in years) 6.38 2.71 Weighted Average Fair Value of Awards Granted $ 4.20 $ 8.43 |
2015 Incentive Plan [Member] | |
Summary of Weighted Average Assumptions | The Company estimated the fair value of options granted in the fiscal years below using a Black-Scholes option pricing model with the following weighted average assumptions: For the fiscal year ended June 30, 2018 For the fiscal year ended July 1, 2017 For the fiscal year ended July 2, 2016 Risk-free Interest Rate 2.00 % 1.30 % 1.56 % Dividend Yield 0.00 % 0.00 % 0.00 % Expected Volatility 32.00 % 33.00 % 37.94 % Expected Term (in years) 6.25 6.25 6.25 Weighted Average Fair Value of Awards Granted $ 10.22 $ 9.10 $ 7.55 |
Summary of Stock Option Activity | The following table summarizes the stock option activity for fiscal 2018 under the 2015 Incentive Plan. Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Term Aggregate Intrinsic Value (in millions) Outstanding as of July 1, 2017 574,717 $ 24.62 Granted 323,430 $ 28.80 Exercised (24,491 ) $ 24.24 Forfeited (20,006 ) $ 24.75 Outstanding as of June 30, 2018 853,650 $ 26.21 8.34 $ 9.0 Vested or expected to vest as of June 30, 2018 853,650 $ 26.21 8.44 $ 9.0 Exercisable as of June 30, 2018 148,275 $ 23.60 7.73 $ 1.9 |
Summary of Changes in Nonvested Restricted Shares and Restricted Stock Units | The following table summarizes the changes in nonvested restricted shares and restricted stock units for fiscal 2018 under the 2015 Incentive Plan. Shares Weighted Average Grant Date Fair Value Nonvested as of July 1, 2017 1,110,457 $ 22.50 Granted 578,726 $ 28.64 Vested (282,903 ) $ 21.89 Forfeited (102,402 ) $ 24.13 Nonvested as of June 30, 2018 1,303,878 $ 25.23 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Jun. 30, 2018 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | Corporate & All Other is comprised of corporate overhead and certain operations that are not considered separate reportable segments based on their size. This includes the operations of the Company’s internal logistics unit responsible for managing and allocating inbound logistics revenue and expense, as well as the operations of certain recent acquisitions. In the first quarter of fiscal 2018, the Company reorganized its information technology department, and expenses associated with business application teams are now included in the segment results. The EBITDA for Performance Foodservice, Vistar, and Corporate & All Other for the fiscal years ended July 1, 2017 and July 2, 2016 has been adjusted to reflect this change. (In millions) PFS PFG Customized Vistar Corporate & All Other Eliminations Consolidated For fiscal year ended June 30, 2018 Net external sales $ 10,420.4 $ 3,658.1 $ 3,338.5 $ 202.9 $ — $ 17,619.9 Inter-segment sales 10.8 0.4 2.5 246.5 (260.2 ) — Total sales 10,431.2 3,658.5 3,341.0 449.4 (260.2 ) 17,619.9 EBITDA 330.6 29.5 133.1 (109.1 ) — 384.1 Depreciation and amortization 58.7 14.6 27.4 29.4 — 130.1 Capital expenditures 83.8 16.6 18.4 21.3 — 140.1 For fiscal year ended July 1, 2017 Net external sales $ 9,813.3 $ 3,819.5 $ 3,001.0 $ 128.0 $ — $ 16,761.8 Inter-segment sales 9.1 1.3 2.6 219.8 (232.8 ) — Total sales 9,822.4 3,820.8 3,003.6 347.8 (232.8 ) 16,761.8 EBITDA 320.0 25.3 117.7 (124.3 ) — 338.7 Depreciation and amortization 57.4 16.1 24.6 28.0 — 126.1 Capital expenditures 91.6 9.5 6.4 32.7 — 140.2 For fiscal year ended July 2, 2016 Net external sales $ 9,608.9 $ 3,781.1 $ 2,698.8 $ 16.0 $ — $ 16,104.8 Inter-segment sales 7.4 1.0 2.7 204.5 (215.6 ) — Total sales 9,616.3 3,782.1 2,701.5 220.5 (215.6 ) 16,104.8 EBITDA 303.2 34.1 110.1 (130.4 ) — 317.0 Depreciation and amortization 63.2 15.4 18.2 21.8 — 118.6 Capital expenditures 67.5 8.2 13.4 30.6 — 119.7 |
Summary Assets by Reportable Segment, Excluding Intercompany Receivables | Total assets by reportable segment, excluding intercompany receivables between segments, are as follows: (In millions) As of June 30, 2018 As of July 1, 2017 PFS $ 2,267.9 $ 2,161.2 PFG Customized 644.3 667.1 Vistar 739.0 654.5 Corporate & All Other 349.7 321.3 Total assets $ 4,000.9 $ 3,804.1 |
Summary Sales Mix for Principal Product and Service Categories | The sales mix for the Company’s principal product and service categories is as follows: (In millions) For the fiscal year ended June 30, 2018 For the fiscal year ended July 1, 2017 For the fiscal year ended July 2, 2016 Center of the plate $ 5,693.4 $ 5,520.5 $ 5,187.5 Frozen foods 2,365.0 2,195.3 2,101.3 Refrigerated and dairy products 2,217.3 2,093.7 2,081.7 Canned and dry groceries 2,205.1 2,146.6 2,172.8 Beverage 1,495.2 1,433.5 1,315.2 Paper products and cleaning supplies 1,351.8 1,291.6 1,241.4 Candy 773.4 706.8 687.2 Snack 730.9 627.2 578.6 Produce 511.1 490.6 507.7 Theater and concession 190.0 156.0 144.2 Merchandising and other services 86.7 100.0 87.2 Total $ 17,619.9 $ 16,761.8 $ 16,104.8 |
Summary of Business Activities
Summary of Business Activities - Additional Information (Detail) - USD ($) | Oct. 06, 2015 | Dec. 31, 2017 | Jul. 02, 2016 | |
Business Description [Line Items] | ||||
Payments on Term Facility | [1] | $ 736,900,000 | ||
IPO [Member] | ||||
Business Description [Line Items] | ||||
Underwriter discount, per share | $ 1.045 | |||
Underwriter discount, amount | $ 13,400,000 | |||
Accrued offering expense | 5,800,000 | |||
Payment for stock issuance cost | $ 3,000,000 | |||
IPO [Member] | Term Loan Facility [Member] | ||||
Business Description [Line Items] | ||||
Payments on Term Facility | 223,000,000 | |||
Common Stock [Member] | ||||
Business Description [Line Items] | ||||
Issuance of common shares | 12.8 | |||
Proceeds from issuance of public offering, gross | $ 242,800,000 | |||
Common Stock [Member] | IPO [Member] | ||||
Business Description [Line Items] | ||||
Issuance of common shares | 16,675,000 | |||
Issuance of common shares, price per share | $ 19 | |||
Issuance of common shares net of underwriter discount, price per share | $ 17.955 | |||
Issuance of common shares | 12,777,325 | |||
Number of common shares sold by selling stockholders | 3,897,675 | |||
Common Stock [Member] | Secondary Offering [Member] | Wellspring Capital Management [Member] | ||||
Business Description [Line Items] | ||||
Number of common shares sold by selling stockholders | 16,272,914 | |||
Proceeds from issuance of secondary offerings | $ 0 | |||
Ownership percentage | 0.00% | |||
[1] | The consolidated statements of cash flows for the fiscal years ended July 1, 2017 and July 2, 2016 have been adjusted to reflect the adoption of ASU 2016-08, Statement of Cash Flows (Topic 230): Restricted Cash. The consolidated statements of cash flows explain the change during the periods in the total of cash and restricted cash. Therefore, restricted cash activity is included with cash when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. Cash payments of $7.3 million in fiscal 2016 related to insurance claims paid using restricted cash is classified as a change in Accrued expenses and other liabilities within Net cash provided by operating activities. Refer to Note 3 for further discussion. |
Summary of Significant Accoun43
Summary of Significant Accounting Policies and Estimates - Additional Information (Detail) - USD ($) | 12 Months Ended | ||||
Jun. 30, 2018 | Jul. 01, 2017 | Jul. 02, 2016 | |||
Schedule Of Significant Accounting Policies [Line Items] | |||||
Funds deposited in insurance trusts | $ 10,300,000 | $ 12,900,000 | |||
Allowance for doubtful accounts related to receivables | 19,300,000 | 17,000,000 | |||
Provision for doubtful accounts | 12,100,000 | 6,000,000 | [1] | $ 7,500,000 | [1] |
Inventories, net | 1,051,900,000 | 1,013,300,000 | |||
Inventories at first in first out cost | 954,800,000 | ||||
Inventories at last in first out cost | 97,100,000 | ||||
Inventory reserve | 6,900,000 | 6,600,000 | |||
Consideration received from vendors | 24,300,000 | 22,900,000 | |||
Adjusted inventories | $ 4,000,000 | 4,500,000 | |||
Estimated useful lives of assets | Depreciation of property, plant and equipment, including capital lease assets, is calculated primarily using the straight-line method over the estimated useful lives of the assets, which range from two to 39 years | ||||
Impairment losses | $ 0 | 0 | 0 | ||
Impairment of goodwill and intangible assets | 0 | 0 | 0 | ||
Cost of goods sold | 15,327,100,000 | 14,637,000,000 | 14,094,800,000 | ||
Shipping and Handling Fees | |||||
Schedule Of Significant Accounting Policies [Line Items] | |||||
Cost of goods sold | $ 884,500,000 | 807,700,000 | $ 752,000,000 | ||
Minimum [Member] | |||||
Schedule Of Significant Accounting Policies [Line Items] | |||||
Useful lives of assets | 2 years | ||||
Intangible assets estimated useful life | 2 years | ||||
Maximum [Member] | |||||
Schedule Of Significant Accounting Policies [Line Items] | |||||
Useful lives of assets | 39 years | ||||
Intangible assets estimated useful life | 11 years | ||||
Trade Receivables [Member] | |||||
Schedule Of Significant Accounting Policies [Line Items] | |||||
Allowance for doubtful accounts related to receivables | $ 11,500,000 | 11,000,000 | |||
Other Receivables [Member] | |||||
Schedule Of Significant Accounting Policies [Line Items] | |||||
Allowance for doubtful accounts related to receivables | 7,800,000 | 6,000,000 | |||
Fair Value Inputs Level 1 [Member] | |||||
Schedule Of Significant Accounting Policies [Line Items] | |||||
Funds deposited in insurance trusts | $ 10,300,000 | $ 10,200,000 | |||
[1] | The consolidated statements of cash flows for the fiscal years ended July 1, 2017 and July 2, 2016 have been adjusted to reflect the adoption of ASU 2016-08, Statement of Cash Flows (Topic 230): Restricted Cash. The consolidated statements of cash flows explain the change during the periods in the total of cash and restricted cash. Therefore, restricted cash activity is included with cash when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. Cash payments of $7.3 million in fiscal 2016 related to insurance claims paid using restricted cash is classified as a change in Accrued expenses and other liabilities within Net cash provided by operating activities. Refer to Note 3 for further discussion. |
Recently Issued Accounting Pr44
Recently Issued Accounting Pronouncements - Additional Information (Detail) $ in Millions | 12 Months Ended |
Jul. 02, 2016USD ($) | |
Accounting Standards Update 2016-18 [Member] | Adjustments for New Accounting Principle, Early Adoption [Member] | |
New Accounting Pronouncements Or Change In Accounting Principle [Line Items] | |
Insurance claims paid using restricted cash | $ 7.3 |
Business Combinations - Additio
Business Combinations - Additional Information (Detail) $ in Millions | 2 Months Ended | 12 Months Ended | ||||
Aug. 24, 2018USD ($)Business-Combination | Jun. 30, 2018USD ($)Business-Combination | Jul. 01, 2017USD ($)Business-Combination | Jul. 02, 2016USD ($)Business-Combination | |||
Business Acquisition [Line Items] | ||||||
Payment for acquisition | $ 71.1 | $ 192.9 | [1] | $ 39 | [1] | |
Number of acquisitions | Business-Combination | 2 | 7 | 2 | |||
Subsequent Event [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Number of acquisitions | Business-Combination | 1 | |||||
Business Acquisition Cost [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Payment for acquisition | $ 72.7 | $ 193.6 | $ 39 | |||
Business Acquisition Cost [Member] | Subsequent Event [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Payment for acquisition | $ 31.5 | |||||
[1] | The consolidated statements of cash flows for the fiscal years ended July 1, 2017 and July 2, 2016 have been adjusted to reflect the adoption of ASU 2016-08, Statement of Cash Flows (Topic 230): Restricted Cash. The consolidated statements of cash flows explain the change during the periods in the total of cash and restricted cash. Therefore, restricted cash activity is included with cash when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. Cash payments of $7.3 million in fiscal 2016 related to insurance claims paid using restricted cash is classified as a change in Accrued expenses and other liabilities within Net cash provided by operating activities. Refer to Note 3 for further discussion. |
Business Combinations - Summary
Business Combinations - Summary of Preliminary Purchase Price Allocation of Major Class of Assets Acquired and Liabilities Assumed (Detail) - USD ($) $ in Millions | Jun. 30, 2018 | Jul. 01, 2017 | Jul. 02, 2016 |
Business Acquisition [Line Items] | |||
Goodwill | $ 740.5 | $ 718.6 | $ 674 |
2018 Acquisitions [Member] | |||
Business Acquisition [Line Items] | |||
Net working capital | 24.9 | ||
Goodwill | 21.3 | ||
Other intangible assets | 24.7 | ||
Property, plant and equipment | 1.8 | ||
Total purchase price | $ 72.7 |
Goodwill and Other Intangible47
Goodwill and Other Intangible Assets - Changes in Carrying Amount of Goodwill (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Jun. 30, 2018 | Jul. 01, 2017 | |
Goodwill [Line Items] | ||
Goodwill, Beginning Balance | $ 718.6 | $ 674 |
Acquisitions—current year | 21.3 | 45 |
Adjustment related to prior year acquisitions | 0.6 | (0.4) |
Goodwill, Ending Balance | 740.5 | 718.6 |
Performance Foodservice [Member] | ||
Goodwill [Line Items] | ||
Goodwill, Beginning Balance | 428.2 | 405.3 |
Acquisitions—current year | 22.9 | |
Adjustment related to prior year acquisitions | 0.3 | |
Goodwill, Ending Balance | 428.5 | 428.2 |
PFG Customized [Member] | ||
Goodwill [Line Items] | ||
Goodwill, Beginning Balance | 166.5 | 166.5 |
Goodwill, Ending Balance | 166.5 | 166.5 |
Vistar [Member] | ||
Goodwill [Line Items] | ||
Goodwill, Beginning Balance | 64.9 | 63 |
Acquisitions—current year | 21.3 | 2.3 |
Adjustment related to prior year acquisitions | (0.4) | |
Goodwill, Ending Balance | 86.2 | 64.9 |
Other [Member] | ||
Goodwill [Line Items] | ||
Goodwill, Beginning Balance | 59 | 39.2 |
Acquisitions—current year | 19.8 | |
Adjustment related to prior year acquisitions | 0.3 | |
Goodwill, Ending Balance | $ 59.3 | $ 59 |
Goodwill and Other Intangible48
Goodwill and Other Intangible Assets - Schedule of Intangible Assets by Major Category (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jul. 01, 2017 | Jul. 02, 2016 | |
Goodwill And Other Intangible Assets [Line Items] | |||
Intangible assets with definite lives, Gross Carrying Amount | $ 698.6 | $ 672.6 | |
Intangible assets with definite lives, Accumulated Amortization | (544.3) | (511) | |
Intangible assets with definite lives, Net | 154.3 | 161.6 | |
Goodwill | 740.5 | 718.6 | $ 674 |
Trade names | 39.5 | 39.5 | |
Total intangible assets with indefinite lives | 780 | 758.1 | |
Customer Relationships [Member] | |||
Goodwill And Other Intangible Assets [Line Items] | |||
Intangible assets with definite lives, Gross Carrying Amount | 477.3 | 457 | |
Intangible assets with definite lives, Accumulated Amortization | (360.4) | (337.4) | |
Intangible assets with definite lives, Net | $ 116.9 | 119.6 | |
Customer Relationships [Member] | Minimum [Member] | |||
Goodwill And Other Intangible Assets [Line Items] | |||
Intangible assets with definite lives | 4 years | ||
Customer Relationships [Member] | Maximum [Member] | |||
Goodwill And Other Intangible Assets [Line Items] | |||
Intangible assets with definite lives | 11 years | ||
Trade Names and Trademarks [Member] | |||
Goodwill And Other Intangible Assets [Line Items] | |||
Intangible assets with definite lives, Gross Carrying Amount | $ 106 | 106 | |
Intangible assets with definite lives, Accumulated Amortization | (95.4) | (92.3) | |
Intangible assets with definite lives, Net | $ 10.6 | 13.7 | |
Trade Names and Trademarks [Member] | Minimum [Member] | |||
Goodwill And Other Intangible Assets [Line Items] | |||
Intangible assets with definite lives | 4 years | ||
Trade Names and Trademarks [Member] | Maximum [Member] | |||
Goodwill And Other Intangible Assets [Line Items] | |||
Intangible assets with definite lives | 9 years | ||
Deferred Financing Costs [Member] | |||
Goodwill And Other Intangible Assets [Line Items] | |||
Intangible assets with definite lives, Gross Carrying Amount | $ 45.5 | 44.2 | |
Intangible assets with definite lives, Accumulated Amortization | (38) | (35.2) | |
Intangible assets with definite lives, Net | $ 7.5 | 9 | |
Deferred financing costs, range of lives | Debt term | ||
Non-Compete [Member] | |||
Goodwill And Other Intangible Assets [Line Items] | |||
Intangible assets with definite lives, Gross Carrying Amount | $ 31.2 | 26.8 | |
Intangible assets with definite lives, Accumulated Amortization | (17.8) | (14) | |
Intangible assets with definite lives, Net | $ 13.4 | 12.8 | |
Non-Compete [Member] | Minimum [Member] | |||
Goodwill And Other Intangible Assets [Line Items] | |||
Intangible assets with definite lives | 2 years | ||
Non-Compete [Member] | Maximum [Member] | |||
Goodwill And Other Intangible Assets [Line Items] | |||
Intangible assets with definite lives | 5 years | ||
Leases [Member] | |||
Goodwill And Other Intangible Assets [Line Items] | |||
Intangible assets with definite lives, Gross Carrying Amount | $ 12.5 | 12.5 | |
Intangible assets with definite lives, Accumulated Amortization | (6.6) | (6) | |
Intangible assets with definite lives, Net | $ 5.9 | 6.5 | |
Leases, range of lives | Lease term | ||
Technology [Member] | |||
Goodwill And Other Intangible Assets [Line Items] | |||
Intangible assets with definite lives, Gross Carrying Amount | $ 26.1 | 26.1 | |
Intangible assets with definite lives, Accumulated Amortization | $ (26.1) | $ (26.1) | |
Technology [Member] | Minimum [Member] | |||
Goodwill And Other Intangible Assets [Line Items] | |||
Intangible assets with definite lives | 5 years | ||
Technology [Member] | Maximum [Member] | |||
Goodwill And Other Intangible Assets [Line Items] | |||
Intangible assets with definite lives | 7 years |
Goodwill and Other Intangible49
Goodwill and Other Intangible Assets - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jul. 01, 2017 | Jul. 02, 2016 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |||
Intangible assets and deferred financing costs amortization | $ 33.3 | $ 37.7 | $ 42.3 |
Goodwill and Other Intangible50
Goodwill and Other Intangible Assets - Estimated Future Amortization Expense on Intangible Assets (Detail) - USD ($) $ in Millions | Jun. 30, 2018 | Jul. 01, 2017 |
Finite Lived Intangible Assets Future Amortization Expense [Abstract] | ||
2,019 | $ 33.7 | |
2,020 | 30.4 | |
2,021 | 29.4 | |
2,022 | 24.2 | |
2,023 | 12.4 | |
Thereafter | 24.2 | |
Intangible assets with definite lives, Net | $ 154.3 | $ 161.6 |
Property, Plant, and Equipmen51
Property, Plant, and Equipment - Summary of Property Plant and Equipment (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Jun. 30, 2018 | Jul. 01, 2017 | |
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 1,414.8 | $ 1,286.2 |
Less: accumulated depreciation and amortization | (619.3) | (545.5) |
Property, plant and equipment, net | $ 795.5 | 740.7 |
Property, plant and equipment, Range of Lives | Depreciation of property, plant and equipment, including capital lease assets, is calculated primarily using the straight-line method over the estimated useful lives of the assets, which range from two to 39 years | |
Warehouse and Plant Equipment [Member] | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 257.5 | 242.3 |
Warehouse and Plant Equipment [Member] | Minimum [Member] | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, Range of Lives | P3Y | |
Warehouse and Plant Equipment [Member] | Maximum [Member] | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, Range of Lives | P20Y | |
Building and Building Improvements [Member] | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 477.1 | 452.7 |
Building and Building Improvements [Member] | Minimum [Member] | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, Range of Lives | P10Y | |
Building and Building Improvements [Member] | Maximum [Member] | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, Range of Lives | P39Y | |
Land [Member] | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 48.7 | 47.9 |
Transportation Equipment [Member] | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 152.6 | 136.4 |
Transportation Equipment [Member] | Minimum [Member] | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, Range of Lives | P2Y | |
Transportation Equipment [Member] | Maximum [Member] | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, Range of Lives | P10Y | |
Office Equipment, Furniture, and Fixtures [Member] | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 279.7 | 247.8 |
Office Equipment, Furniture, and Fixtures [Member] | Minimum [Member] | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, Range of Lives | P2Y | |
Office Equipment, Furniture, and Fixtures [Member] | Maximum [Member] | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, Range of Lives | P10Y | |
Leasehold Improvements [Member] | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 114 | 108.3 |
Construction-in-Process [Member] | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 85.2 | $ 50.8 |
Property, Plant, and Equipmen52
Property, Plant, and Equipment - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||||
Jun. 30, 2018 | Jul. 01, 2017 | Jul. 02, 2016 | |||
Property Plant And Equipment [Abstract] | |||||
Depreciation expense | $ 100.3 | $ 91.5 | [1] | $ 80.5 | [1] |
[1] | The consolidated statements of cash flows for the fiscal years ended July 1, 2017 and July 2, 2016 have been adjusted to reflect the adoption of ASU 2016-08, Statement of Cash Flows (Topic 230): Restricted Cash. The consolidated statements of cash flows explain the change during the periods in the total of cash and restricted cash. Therefore, restricted cash activity is included with cash when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. Cash payments of $7.3 million in fiscal 2016 related to insurance claims paid using restricted cash is classified as a change in Accrued expenses and other liabilities within Net cash provided by operating activities. Refer to Note 3 for further discussion. |
Debt - Schedule of Debt (Detail
Debt - Schedule of Debt (Detail) - USD ($) $ in Millions | Jun. 30, 2018 | Jul. 01, 2017 |
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 1,130.1 | |
Less: Original issue discount and deferred financing costs | (7.1) | $ (8.2) |
Long-term debt | 1,123 | 1,247.7 |
Capital and finance lease obligations | 61.2 | 49.9 |
Total debt | 1,184.2 | 1,297.6 |
Less: current installments | (8.4) | (11.7) |
Total debt, excluding current installments | 1,175.8 | 1,285.9 |
ABL Facility [Member] | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | 780.1 | 899.9 |
5.500% Senior Notes due 2024 [Member] | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 350 | 350 |
Unsecured Subordinated Promissory Note [Member] | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 6 |
Debt - Additional Information (
Debt - Additional Information (Detail) | May 17, 2016USD ($) | Dec. 30, 2017USD ($) | Jun. 30, 2018USD ($)Facility | Jul. 02, 2016USD ($) | Jul. 01, 2017USD ($) | Dec. 21, 2012USD ($) |
Debt Instrument [Line Items] | ||||||
Debt Instrument, description of redemption | Upon the occurrence of a change of control triggering event or upon the sale of certain assets in which Performance Food Group, Inc. does not apply the proceeds as required, the holders of the Notes will have the right to require Performance Food Group, Inc. to repurchase each holder’s Notes at a price equal to 101% (in the case of a change of control triggering event) or 100% (in the case of an asset sale) of their principal amount, plus accrued and unpaid interest. | |||||
Payment of promissory note | $ 6,000,000 | |||||
Vistar [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Sale leased back period | 2 years | |||||
Capital Lease Obligations [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Number of performance food service distribution facility | Facility | 2 | |||||
Capital lease obligation depreciation expense, gross | $ 84,900,000 | $ 69,700,000 | ||||
Capital lease obligation depreciation expense, net | 52,300,000 | $ 41,800,000 | ||||
Case of Asset Sale [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Percentage price of principal amount at which debt can be redeemed | 100.00% | |||||
Proceeds of Certain Equity Offerings [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Percentage price of principal amount at which debt can be redeemed | 105.50% | |||||
On June 1,2021 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Percentage price of principal amount at which debt can be redeemed | 100.00% | |||||
Beginning on June 1,2019 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Percentage price of principal amount at which debt can be redeemed | 102.75% | |||||
On June 1,2020 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Percentage price of principal amount at which debt can be redeemed | 101.325% | |||||
Prior to June 1,2019 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Percentage price of principal amount at which debt can be redeemed | 100.00% | |||||
Prior to June 1,2019 [Member] | Proceeds of Certain Equity Offerings [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Percentage of debt that can be redeemed from proceeds of certain equity offerings | 40.00% | |||||
ABL Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt instruments face amount | $ 1,950,000,000 | |||||
Credit facility, maturity period | 2021-02 | |||||
Debt instrument description of variable rate | (a) the Base Rate (defined as the greater of (i) the Federal Funds Rate in effect on such date plus 0.5%, (ii) the Prime Rate on such day, or (iii) one month LIBOR plus 1.0%) plus a spread or (b) LIBOR plus a spread. | |||||
Committed amount to be maintained under the covenant | $ 160,000,000 | |||||
Covenant borrowing base, percentage | 10.00% | |||||
Credit facility, covenant term | The greater of (i) $130.0 million and (ii) 10% of the lesser of the borrowing base and the revolving credit facility amount for five consecutive business days. | |||||
ABL Facility [Member] | Federal Funds Effective Swap Rate [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable rate | 0.50% | |||||
ABL Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable rate | 1.00% | |||||
ABL Facility [Member] | Minimum [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Credit facility, commitment fee percentage | 0.25% | |||||
ABL Facility [Member] | Maximum [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Credit facility, commitment fee percentage | 0.375% | |||||
5.500% Senior Notes due 2024 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt instruments face amount | $ 350,000,000 | |||||
Debt instruments amount, interest rate | 5.50% | 5.50% | ||||
Debt instruments maturity year | 2,024 | |||||
Issue price of notes as a percentage of par value | 100.00% | |||||
Debt Instrument maturity date | Jun. 1, 2024 | |||||
5.500% Senior Notes due 2024 [Member] | Change of Control Triggering Event [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Percentage price of principal amount at which debt can be redeemed | 101.00% | |||||
ABL Facility and Term Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt covenant restrictive amount | $ 486,000,000 | |||||
Term Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Loss on extinguishment | $ 9,400,000 | |||||
Accelerated Amortization | $ 5,500,000 | |||||
Unsecured Subordinated Promissory Note [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt instruments face amount | $ 6,000,000 | |||||
Payment of promissory note | $ 6,000,000 |
Debt - Summary of Outstanding B
Debt - Summary of Outstanding Borrowings, Availability, and Average Interest Rate under ABL Facility (Detail) - USD ($) $ in Millions | Jun. 30, 2018 | Jul. 01, 2017 |
Debt Instrument [Line Items] | ||
Aggregate borrowings | $ 1,130.1 | |
ABL Facility [Member] | ||
Debt Instrument [Line Items] | ||
Aggregate borrowings | 780.1 | $ 899.9 |
Letters of credit | 121.3 | 105.5 |
Excess availability, net of lenders’ reserves of $12.1 and $11.2, respectively | $ 854.2 | $ 594.6 |
Average interest rate | 3.52% | 2.59% |
Debt - Summary of Outstanding56
Debt - Summary of Outstanding Borrowings, Availability, and Average Interest Rate under ABL Facility (Parenthetical) (Detail) - USD ($) $ in Millions | Jun. 30, 2018 | Jul. 01, 2017 |
ABL Facility [Member] | ||
Debt Instrument [Line Items] | ||
Debt amount reserve by lender | $ 12.1 | $ 11.2 |
Debt - Schedule of Fiscal Year
Debt - Schedule of Fiscal Year Maturities of Long Term Debt Excluding Capital and Finance Lease Obligation (Detail) $ in Millions | Jun. 30, 2018USD ($) |
Debt Disclosure [Abstract] | |
2,019 | $ 0 |
2,020 | 0 |
2,021 | 780.1 |
2,022 | 0 |
2,023 | 0 |
Thereafter | 350 |
Total long-term debt, excluding capital and finance lease obligations | $ 1,130.1 |
Debt - Schedule of Future Minim
Debt - Schedule of Future Minimum Lease Payments under Non-Cancelable Capital Lease Obligations (Detail) $ in Millions | Jun. 30, 2018USD ($) |
Debt Disclosure [Abstract] | |
2,019 | $ 12.1 |
2,020 | 10 |
2,021 | 9.6 |
2,022 | 9.4 |
2,023 | 8.3 |
Thereafter | 33.5 |
Total future minimum lease payments | 82.9 |
Less: interest | 21.7 |
Present value of future minimum lease payments | $ 61.2 |
Derivatives and Hedging Activ59
Derivatives and Hedging Activities - Additional Information (Detail) | 6 Months Ended | 12 Months Ended | |||
Dec. 31, 2018gal | Jun. 29, 2019USD ($) | Jun. 30, 2018USD ($)Interest_Rates_SwapsAgreementgal | Jul. 01, 2017USD ($) | Jul. 02, 2016USD ($) | |
Derivative [Line Items] | |||||
Ineffectiveness on interest rate swaps | $ (100,000) | $ 1,500,000 | $ (500,000) | ||
Number of arrangements | Agreement | 3 | ||||
Non-monetary notional amount volume | gal | 4,500,000 | ||||
Scenario Forecast [Member] | |||||
Derivative [Line Items] | |||||
Reclassification gains to interest expense | $ 4,100,000 | ||||
Non-monetary notional amount volume | gal | 4,500,000 | ||||
Interest Rate Swaps [Member] | |||||
Derivative [Line Items] | |||||
Number of interest rate swaps | Interest_Rates_Swaps | 8 | ||||
Notional Amount | $ 650,000,000 |
Derivatives and Hedging Activ60
Derivatives and Hedging Activities - Schedule of Outstanding Swap Agreements (Detail) | 12 Months Ended |
Jun. 30, 2018USD ($) | |
Interest Rate Swap Agreement One [Member] | |
Derivative [Line Items] | |
Effective Date | Aug. 9, 2013 |
Maturity Date | Aug. 9, 2018 |
Notional Amount | $ 200,000,000 |
Fixed Rate Swapped | 1.51% |
Interest Rate Swap Agreement Two [Member] | |
Derivative [Line Items] | |
Effective Date | Jun. 30, 2017 |
Maturity Date | Jun. 30, 2019 |
Notional Amount | $ 50,000,000 |
Fixed Rate Swapped | 1.13% |
Interest Rate Swap Agreement Three [Member] | |
Derivative [Line Items] | |
Effective Date | Jun. 30, 2017 |
Maturity Date | Jun. 30, 2020 |
Notional Amount | $ 50,000,000 |
Fixed Rate Swapped | 1.23% |
Interest Rate Swap Agreement Four [Member] | |
Derivative [Line Items] | |
Effective Date | Jun. 30, 2017 |
Maturity Date | Jun. 30, 2020 |
Notional Amount | $ 50,000,000 |
Fixed Rate Swapped | 1.25% |
Interest Rate Swap Agreement Five [Member] | |
Derivative [Line Items] | |
Effective Date | Jun. 30, 2017 |
Maturity Date | Jun. 30, 2020 |
Notional Amount | $ 50,000,000 |
Fixed Rate Swapped | 1.26% |
Interest Rate Swap Agreement Six [Member] | |
Derivative [Line Items] | |
Effective Date | Aug. 9, 2018 |
Maturity Date | Aug. 9, 2021 |
Notional Amount | $ 75,000,000 |
Fixed Rate Swapped | 1.21% |
Interest Rate Swap Agreement Seven [Member] | |
Derivative [Line Items] | |
Effective Date | Aug. 9, 2018 |
Maturity Date | Aug. 9, 2021 |
Notional Amount | $ 75,000,000 |
Fixed Rate Swapped | 1.20% |
Interest Rate Swap Agreement Eight [Member] | |
Derivative [Line Items] | |
Effective Date | Jun. 30, 2020 |
Maturity Date | Dec. 31, 2021 |
Notional Amount | $ 100,000,000 |
Fixed Rate Swapped | 2.16% |
Derivatives and Hedging Activ61
Derivatives and Hedging Activities - Effect of Interest Rate Swaps Designated in Hedging Relationships on Consolidated Statement of Operations (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jul. 01, 2017 | Jul. 02, 2016 | |
Derivative Instruments, Gain (Loss) [Line Items] | |||
Amount of (gain) loss recognized in OCI, after-tax | $ (5.8) | $ (5.7) | $ 5.7 |
Amount of gain (loss) reclassified from OCI into interest expense, after-tax | 0.4 | (2.5) | (4.4) |
Cash Flow Hedging [Member] | Derivatives Designated as Hedging Instruments Under ASC 815-20 [Member] | Interest Rate Swaps [Member] | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Amount of (gain) loss recognized in OCI, pre-tax | (7.9) | (9.3) | 9.3 |
Tax expense (benefit) | 2.1 | 3.6 | (3.6) |
Amount of (gain) loss recognized in OCI, after-tax | (5.8) | (5.7) | 5.7 |
Amount of gain (loss) reclassified from OCI into interest expense, pre-tax | 0.6 | (4) | (7.3) |
Tax (expense) benefit | (0.2) | 1.5 | 2.9 |
Amount of gain (loss) reclassified from OCI into interest expense, after-tax | $ 0.4 | $ (2.5) | $ (4.4) |
Derivatives and Hedging Activ62
Derivatives and Hedging Activities - Summary of Fair Value of Derivative Financial Instruments (Detail) - USD ($) $ in Millions | Jun. 30, 2018 | Jul. 01, 2017 |
Derivatives, Fair Value [Line Items] | ||
Asset Derivatives Fair Value | $ 12.5 | $ 5.3 |
Liability Derivatives Fair Value | 0.3 | |
Accrued Expenses and Other Current Liabilities [Member] | Interest Rate Swaps [Member] | Derivatives Designated as Hedging Instruments Under ASC 815-20 [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Liability Derivatives Fair Value | 0.3 | |
Other Assets [Member] | Interest Rate Swaps [Member] | Derivatives Designated as Hedging Instruments Under ASC 815-20 [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Asset Derivatives Fair Value | 8.4 | 5 |
Prepaid Expenses and Other Current Assets [Member] | Interest Rate Swaps [Member] | Derivatives Designated as Hedging Instruments Under ASC 815-20 [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Asset Derivatives Fair Value | 4 | $ 0.3 |
Prepaid Expenses and Other Current Assets [Member] | Diesel Fuel Collars [Member] | Derivatives Not Designated as Hedging Instruments Under ASC 815-20 [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Asset Derivatives Fair Value | $ 0.1 |
Derivatives and Hedging Activ63
Derivatives and Hedging Activities - Summary of Derivative Assets and Liability Balance by Type of Financial Instrument Before and After Effects of Offsetting (Detail) - USD ($) $ in Millions | Jun. 30, 2018 | Jul. 01, 2017 |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | ||
Gross Amounts Presented in the Consolidated Balance Sheet | $ 12.5 | $ 5.3 |
Net Amounts | $ 12.5 | 5.3 |
Gross Amounts Presented in the Consolidated Balance Sheet | 0.3 | |
Net Amounts | $ 0.3 |
Insurance Program Liabilities -
Insurance Program Liabilities - Summary of Activity in All Types of Deductible Insurance Program Liabilities (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jul. 01, 2017 | Jul. 02, 2016 | |
Insurance [Abstract] | |||
Beginning balance | $ 97.8 | $ 87.3 | $ 84 |
Charged to costs and expenses | 164.5 | 165.2 | 146.7 |
Payments | (154.9) | (154.7) | (143.4) |
Ending Balance | $ 107.4 | $ 97.8 | $ 87.3 |
Fair Value of Financial Instr65
Fair Value of Financial Instruments - Additional Information (Detail) - USD ($) $ in Millions | Jun. 30, 2018 | Jul. 01, 2017 |
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | ||
Long-term debt | $ 1,123 | $ 1,247.7 |
Reported Value Measurement [Member] | ||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | ||
Long-term debt | 1,123 | 1,247.7 |
Fair Value Inputs Level 2 [Member] | ||
Fair Value Inputs, Liabilities, Quantitative Information [Line Items] | ||
Fair value of long term debt | $ 1,126.7 | $ 1,258.3 |
Leases - Schedule of Future Min
Leases - Schedule of Future Minimum Lease Payments Under Operating Agreement (Detail) $ in Millions | Jun. 30, 2018USD ($) |
Operating Leases Future Minimum Payments Due [Abstract] | |
2,019 | $ 91.5 |
2,020 | 81.2 |
2,021 | 65.6 |
2,022 | 52.9 |
2,023 | 39.7 |
Thereafter | 119.5 |
Total minimum lease payments | $ 450.4 |
Leases - Additional Information
Leases - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jul. 01, 2017 | Jul. 02, 2016 | |
Operating Costs And Expenses [Abstract] | |||
Rent expenses for operating lease | $ 119.9 | $ 115.7 | $ 105.7 |
Income Taxes - Schedule of Inco
Income Taxes - Schedule of Income Tax Expense (Detail) - USD ($) $ in Millions | 12 Months Ended | ||||
Jun. 30, 2018 | Jul. 01, 2017 | Jul. 02, 2016 | |||
Current income tax (benefit) expense: | |||||
Federal | $ (8.6) | $ 45.8 | $ 40.2 | ||
State | 2.1 | 9.3 | 6.4 | ||
Total current income tax (benefit) expense | (6.5) | 55.1 | 46.6 | ||
Deferred income tax (benefit) expense: | |||||
Federal | (7.2) | 3.6 | (1.1) | ||
State | 8.6 | 2.7 | 0.7 | ||
Total deferred income tax expense (benefit) | 1.4 | 6.3 | [1] | (0.4) | [1] |
Total income tax (benefit) expense, net | $ (5.1) | $ 61.4 | $ 46.2 | ||
[1] | The consolidated statements of cash flows for the fiscal years ended July 1, 2017 and July 2, 2016 have been adjusted to reflect the adoption of ASU 2016-08, Statement of Cash Flows (Topic 230): Restricted Cash. The consolidated statements of cash flows explain the change during the periods in the total of cash and restricted cash. Therefore, restricted cash activity is included with cash when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. Cash payments of $7.3 million in fiscal 2016 related to insurance claims paid using restricted cash is classified as a change in Accrued expenses and other liabilities within Net cash provided by operating activities. Refer to Note 3 for further discussion. |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) | 6 Months Ended | 12 Months Ended | |||
Jun. 30, 2018 | Dec. 30, 2017 | Jun. 30, 2018 | Jul. 01, 2017 | Jul. 02, 2016 | |
Income Tax Contingency [Line Items] | |||||
U.S. federal corporate income tax rate | 21.00% | 35.00% | 28.00% | 35.00% | 35.00% |
Effective income tax rate | (2.60%) | 39.00% | 40.30% | ||
Valuation allowance | $ 400,000 | $ 400,000 | |||
Unrecognized tax benefits | 1,200,000 | 1,200,000 | $ 1,300,000 | ||
Interest related to uncertain tax positions | $ 200,000 | $ 200,000 | 100,000 | ||
Minimum [Member] | |||||
Income Tax Contingency [Line Items] | |||||
State net operating loss carry-forwards expire | 2,018 | ||||
Maximum [Member] | |||||
Income Tax Contingency [Line Items] | |||||
State net operating loss carry-forwards expire | 2,037 | ||||
Net interest (expense) benefit | $ 100,000 | $ 100,000 | $ 100,000 |
Income Taxes - Schedule Effecti
Income Taxes - Schedule Effective Income Tax Rate from Continuing Operation (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jul. 01, 2017 | Jul. 02, 2016 | |
Effective Income Tax Rate Reconciliation, Amount [Abstract] | |||
Federal income tax expense computed at statutory rate | $ 54.3 | $ 55.2 | $ 40 |
State income taxes, net of federal income tax benefit | 10.4 | 7.5 | 4.8 |
Non-deductible expenses and other | 1.7 | 3.4 | 2.7 |
Tax law change | (50.4) | ||
Stock-based compensation | (20.6) | (4.7) | (1.3) |
Other | (0.5) | ||
Total income tax (benefit) expense, net | $ (5.1) | $ 61.4 | $ 46.2 |
Income Taxes - Schedule of Effe
Income Taxes - Schedule of Effective Income Tax Rate Reconciliation (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jul. 01, 2017 | Jul. 02, 2016 | |
Income Tax Disclosure [Abstract] | |||
Income tax (benefit), reported | $ (5.1) | $ 61.4 | $ 46.2 |
Revaluation of net deferred income tax liability | 38.5 | ||
Other impact of tax law change | 11.9 | ||
Stock-based compensation - performance vesting | 15.4 | ||
Income tax expense, excluding benefits | $ 60.7 | ||
Income tax (benefit), reported | (2.60%) | 39.00% | 40.30% |
Revaluation of net deferred income tax liability | 19.90% | ||
Other impact of tax law change | 6.10% | ||
Stock-based compensation - performance vesting | 8.00% | ||
Income tax expense, excluding benefits | 31.40% |
Income Taxes - Schedule of Sign
Income Taxes - Schedule of Significant Deferred Tax Assets and Liabilities (Detail) - USD ($) $ in Millions | Jun. 30, 2018 | Jul. 01, 2017 |
Deferred tax assets: | ||
Allowance for doubtful accounts | $ 3.1 | $ 4 |
Inventories | 4.3 | 7 |
Accrued employee benefits | 6.9 | 9.8 |
Self-insurance reserves | 1.6 | 2.5 |
Net operating loss carry-forwards | 5.8 | 4.2 |
Stock-based compensation | 6.4 | 12 |
Deferred rent | 0.6 | 1 |
Other assets | 0.9 | 2.6 |
Total gross deferred tax assets | 29.6 | 43.1 |
Less: Valuation allowance | (0.4) | |
Total net deferred tax assets | 29.2 | 43.1 |
Deferred tax liabilities: | ||
Property, plant, and equipment | 82.8 | 86.8 |
Other comprehensive income | 2.9 | 1.5 |
Basis difference in intangible assets | 34.1 | 51.1 |
Prepaid expenses | 15.6 | 6.5 |
Other | 0.1 | 0.2 |
Total deferred tax liabilities | 135.5 | 146.1 |
Total net deferred income tax liability | $ 106.3 | $ 103 |
Income Taxes - Summary of Activ
Income Taxes - Summary of Activity Related to Unrecognized Tax Benefits (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jul. 01, 2017 | Jul. 02, 2016 | |
Reconciliation Of Unrecognized Tax Benefits Excluding Amounts Pertaining To Examined Tax Returns Roll Forward | |||
beginning balance | $ 1.3 | $ 0.4 | $ 0.9 |
Increases due to current year positions | 0.2 | 0.5 | |
Increases due to prior years positions | 0.6 | ||
Settlements with taxing authorities | (0.1) | ||
Decreases due to prior years positions | (0.2) | ||
Expiration of statutes of limitations | (0.1) | (0.2) | (0.4) |
Ending balance | $ 1.2 | $ 1.3 | $ 0.4 |
Retirement Plans - Additional I
Retirement Plans - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jul. 01, 2017 | Jul. 02, 2016 | |
401 (k) Plan [Member] | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Employees participating for internal revenue code, maximum | 50.00% | ||
Employees participating for internal revenue code, minimum | 1.00% | ||
Employees matching contribution | 100.00% | ||
Employees first contribution | 3.50% | ||
Retirement contribution | $ 17.9 | $ 16.5 | $ 16 |
STAR Plan Contribution [Member] | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Retirement contribution | $ 3.9 | $ 3.9 | $ 4.2 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) | 12 Months Ended |
Jun. 30, 2018USD ($) | |
Commitments And Contingencies [Line Items] | |
Outstanding contracts and purchase orders for capital projects and services | $ 26,400,000 |
Undiscounted maximum amount for guarantees | 26,100,000 |
Future guarantee annual payments | 300,000 |
Guarantees [Member] | |
Commitments And Contingencies [Line Items] | |
Undiscounted maximum amount for guarantees | $ 4,000,000 |
Expiration date | Jun. 30, 2019 |
Minimum [Member] | |
Commitments And Contingencies [Line Items] | |
Operating lease agreements range | 7.00% |
Operating lease expiration term | 4 years |
Operating lease expiration dates | 2,018 |
Maximum [Member] | |
Commitments And Contingencies [Line Items] | |
Operating lease agreements range | 20.00% |
Operating lease expiration term | 8 years |
Operating lease expiration dates | 2,025 |
Multiemployer Pension Plans [Member] | |
Commitments And Contingencies [Line Items] | |
Voluntary withdrawal payment on liability or obligation | $ 5,100,000 |
Related-Party Transactions - Ad
Related-Party Transactions - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jul. 01, 2017 | Jul. 02, 2016 | |
Purchasing Alliance [Member] | |||
Related Party Transaction [Line Items] | |||
Equity method investments | $ 4.3 | $ 4.6 | |
Purchases from related party | 827.9 | 802.8 | $ 514.8 |
Blackstone Group and Affiliates of Wellspring Capital Management [Member] | |||
Related Party Transaction [Line Items] | |||
Annual payment and reimbursements to affiliates | $ 3 | $ 5.6 | $ 5 |
Earnings Per Share ("EPS") - Ad
Earnings Per Share ("EPS") - Additional Information (Detail) - shares shares in Millions | 12 Months Ended | |
Jun. 30, 2018 | Jul. 01, 2017 | |
Earnings Per Share [Abstract] | ||
Potential common shares not included in computing diluted earnings per share due to antidilutive effect | 0.7 | 0.6 |
Earnings Per Share ("EPS") - Sc
Earnings Per Share ("EPS") - Schedule of Reconciliation of Numerators and Denominators for Basic and Diluted Earnings Per Share Computations (Detail) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 12 Months Ended | ||||
Jun. 30, 2018 | Jul. 01, 2017 | Jul. 02, 2016 | |||
Numerator: | |||||
Net income | $ 198.7 | $ 96.3 | [1] | $ 68.3 | [1] |
Denominator: | |||||
Weighted-average common shares outstanding | 102 | 100.2 | 96.4 | ||
Dilutive effect of share-based awards | 2.6 | 2.8 | 1.7 | ||
Weighted-average dilutive shares outstanding | 104.6 | 103 | 98.1 | ||
Basic earnings per share | $ 1.95 | $ 0.96 | $ 0.71 | ||
Diluted earnings per share | $ 1.90 | $ 0.93 | $ 0.70 | ||
[1] | The consolidated statements of cash flows for the fiscal years ended July 1, 2017 and July 2, 2016 have been adjusted to reflect the adoption of ASU 2016-08, Statement of Cash Flows (Topic 230): Restricted Cash. The consolidated statements of cash flows explain the change during the periods in the total of cash and restricted cash. Therefore, restricted cash activity is included with cash when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. Cash payments of $7.3 million in fiscal 2016 related to insurance claims paid using restricted cash is classified as a change in Accrued expenses and other liabilities within Net cash provided by operating activities. Refer to Note 3 for further discussion. |
Stock-based Compensation - Addi
Stock-based Compensation - Additional Information (Detail) $ in Millions | Dec. 07, 2017shares | Jul. 30, 2015 | Sep. 30, 2015shares | Dec. 30, 2017USD ($) | Jun. 30, 2018USD ($)Trancheshares | Jul. 01, 2017USD ($)shares | Jul. 02, 2016USD ($) | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Stock compensation expense | $ | $ 21.6 | $ 17.3 | [1] | $ 17.2 | [1] | ||||
Dividend Yield | 0.00% | ||||||||
Income tax benefit | $ | $ 5.1 | (61.4) | (46.2) | ||||||
2007 Option Plan [Member] | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Contractual term of options granted | 10 years | ||||||||
Number of Tranches | Tranche | 3 | ||||||||
Requisite service period | 10 years 8 months 12 days | ||||||||
Award vesting period | 5 years | ||||||||
Share-based compensation arrangement by share-based payment award accelerated compensation cost | $ | 3.8 | ||||||||
Share-based compensation, options exchanged | 3,730,000 | ||||||||
Options approved for grant | 1,460,000 | ||||||||
Restricted stock vested | 2,124,792 | ||||||||
Stock compensation expense | $ | $ 9.5 | 6.7 | 13.2 | ||||||
Income tax benefit | $ | (3.1) | (2.6) | (5.1) | ||||||
Unrecognized compensation cost | $ | $ 0.8 | ||||||||
Compensation expense, period for recognition | 1 year 8 months 12 days | ||||||||
Intrinsic value of exercised options | $ | $ 17.1 | $ 14.4 | $ 5.7 | ||||||
2007 Option Plan [Member] | Restricted Stock [Member] | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Shares granted | 2,270,000 | ||||||||
2007 Option Plan [Member] | Time Based Vesting [Member] | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Share-based Compensation arrangement by Share-based payment award, annual award vesting rights | 20.00% | ||||||||
2007 Option Plan [Member] | Tranche Two and Three [Member] | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Share-based compensation arrangement by share-based payment award accelerated compensation cost | $ | $ 6.3 | ||||||||
Restricted stock vested | 2,100,000 | ||||||||
Options vested | 1,400,000 | ||||||||
Stock compensation expense | $ | $ 24.9 | ||||||||
Dividend Yield | 0.00% | ||||||||
2007 Option Plan [Member] | Tranche One [Member] | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Options approved for grant | 0 | 0 | |||||||
Dividend Yield | 0.00% | 0.00% | |||||||
2007 Option Plan [Member] | Tranche II [Member] | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Options approved for grant | 0 | 0 | |||||||
2007 Option Plan [Member] | Tranche III [Member] | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Options approved for grant | 0 | 0 | |||||||
2015 Incentive Plan [Member] | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Contractual term of options granted | 10 years | ||||||||
Shares granted | 578,726 | ||||||||
Options approved for grant | 323,430 | ||||||||
Restricted stock vested | 282,903 | ||||||||
Stock compensation expense | $ | $ 12.1 | $ 10.6 | $ 4 | ||||||
Income tax benefit | $ | $ (3.9) | (4.1) | (1.6) | ||||||
Compensation expense, period for recognition | 2 years 6 months | ||||||||
Common stock reserved for issuance | 4,850,000 | ||||||||
Number of shares available for grant | 2,024,518 | ||||||||
Unrecognized compensation cost | $ | $ 26.5 | ||||||||
Fair value of shares vested | $ | $ 8.1 | $ 9.2 | $ 0.6 | ||||||
2015 Incentive Plan [Member] | Restricted Stock [Member] | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Number of shares of which fair value is estimated using Monte Carlo simulation technique | 59,779 | ||||||||
Percentage of stock price on grant date | 92.00% | ||||||||
2015 Incentive Plan [Member] | Options and Time-based restricted shares | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Award vesting period | 4 years | ||||||||
2015 Incentive Plan [Member] | Performance-based Restricted Shares | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Requisite service period | 3 years | ||||||||
2015 Incentive Plan [Member] | Performance relative to the ROIC and Relative TSR goals | Performance-based Restricted Shares | Minimum [Member] | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Share-based Compensation arrangement by Share-based payment award, annual award vesting rights | 0.00% | ||||||||
2015 Incentive Plan [Member] | Performance relative to the ROIC and Relative TSR goals | Performance-based Restricted Shares | Maximum [Member] | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Share-based Compensation arrangement by Share-based payment award, annual award vesting rights | 150.00% | ||||||||
[1] | The consolidated statements of cash flows for the fiscal years ended July 1, 2017 and July 2, 2016 have been adjusted to reflect the adoption of ASU 2016-08, Statement of Cash Flows (Topic 230): Restricted Cash. The consolidated statements of cash flows explain the change during the periods in the total of cash and restricted cash. Therefore, restricted cash activity is included with cash when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. Cash payments of $7.3 million in fiscal 2016 related to insurance claims paid using restricted cash is classified as a change in Accrued expenses and other liabilities within Net cash provided by operating activities. Refer to Note 3 for further discussion. |
Stock-based Compensation - Summ
Stock-based Compensation - Summary of Weighted Average Assumptions (Detail) - $ / shares | 12 Months Ended | ||
Jun. 30, 2018 | Jul. 01, 2017 | Jul. 02, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Dividend Yield | 0.00% | ||
2007 Option Plan [Member] | Tranche One [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Risk-free Interest Rate | 1.72% | ||
Dividend Yield | 0.00% | 0.00% | |
Expected Volatility | 38.00% | ||
Expected Term (in years) | 6 years 6 months | ||
Weighted Average Fair Value of Options Granted | $ 8.99 | ||
2007 Option Plan [Member] | Tranche Two and Three [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Dividend Yield | 0.00% | ||
2007 Option Plan [Member] | Tranche Two and Three [Member] | Restricted Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Risk-free Interest Rate | 1.23% | ||
Dividend Yield | 0.00% | ||
Expected Volatility | 30.00% | ||
Expected Term (in years) | 2 years 8 months 15 days | ||
Weighted Average Fair Value of Awards Granted | $ 8.43 | ||
2007 Option Plan [Member] | Tranche Two and Three [Member] | Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Risk-free Interest Rate | 1.23% | ||
Dividend Yield | 0.00% | ||
Expected Volatility | 30.00% | ||
Expected Term (in years) | 6 years 4 months 17 days | ||
Weighted Average Fair Value of Options Granted | $ 4.20 |
Stock-based Compensation - Su81
Stock-based Compensation - Summary of Stock Option Activity (Detail) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 12 Months Ended |
Sep. 30, 2015 | Jun. 30, 2018 | |
2007 Option Plan [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of Options, Outstanding, Beginning Balance | 2,746,041 | |
Number of Options, Granted | 1,460,000 | |
Number of Options, Exercised | (890,855) | |
Number of Options, Forfeited | (68,243) | |
Number of Options, Expired | (15,264) | |
Number of Options, Outstanding, Ending Balance | 1,771,679 | |
Number of Options, Vested or expected to vest | 1,771,679 | |
Number of Options, Exercisable | 1,567,063 | |
Weighted Average Exercise Price, Beginning balance | $ 14.92 | |
Weighted Average Exercise Price, Exercised | 13.90 | |
Weighted Average Exercise Price, Forfeited | 19.10 | |
Weighted Average Exercise Price, Expired | 10.38 | |
Weighted Average Exercise Price, Ending balance | 15.31 | |
Weighted Average Exercise Price, Vested or expected to vest | 15.31 | |
Weighted Average Exercise Price, Exercisable | $ 14.81 | |
Weighted Average Remaining Contractual Term, outstanding, at end of period | 5 years 3 months 3 days | |
Weighted Average Remaining Contractual Term, vested or expected to vest | 5 years 3 months 3 days | |
Weighted Average Remaining Contractual Term, exercisable | 5 years 10 days | |
Aggregate Intrinsic Value, Ending balance | $ 37.9 | |
Aggregate Intrinsic Value, Vested or expected | 37.9 | |
Aggregate Intrinsic Value, Exercisable | $ 34.3 | |
2015 Incentive Plan [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of Options, Outstanding, Beginning Balance | 574,717 | |
Number of Options, Granted | 323,430 | |
Number of Options, Exercised | (24,491) | |
Number of Options, Forfeited | (20,006) | |
Number of Options, Outstanding, Ending Balance | 853,650 | |
Number of Options, Vested or expected to vest | 853,650 | |
Number of Options, Exercisable | 148,275 | |
Weighted Average Exercise Price, Beginning balance | $ 24.62 | |
Weighted Average Exercise Price, Granted | 28.80 | |
Weighted Average Exercise Price, Exercised | 24.24 | |
Weighted Average Exercise Price, Forfeited | 24.75 | |
Weighted Average Exercise Price, Ending balance | 26.21 | |
Weighted Average Exercise Price, Vested or expected to vest | 26.21 | |
Weighted Average Exercise Price, Exercisable | $ 23.60 | |
Weighted Average Remaining Contractual Term, outstanding, at end of period | 8 years 4 months 2 days | |
Weighted Average Remaining Contractual Term, vested or expected to vest | 8 years 5 months 8 days | |
Weighted Average Remaining Contractual Term, exercisable | 7 years 8 months 23 days | |
Aggregate Intrinsic Value, Ending balance | $ 9 | |
Aggregate Intrinsic Value, Vested or expected | 9 | |
Aggregate Intrinsic Value, Exercisable | $ 1.9 |
Stock-based Compensation - Su82
Stock-based Compensation - Summary of Changes in Nonvested Restricted Shares and Restricted Stock Units (Detail) | 12 Months Ended |
Jun. 30, 2018$ / sharesshares | |
2007 Option Plan [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Nonvested as of July 1, 2017 | shares | 2,180,278 |
Vested | shares | (2,124,792) |
Forfeited | shares | (44,260) |
Nonvested as of June 30, 2018 | shares | 11,226 |
Nonvested as of July 1, 2017 | $ / shares | $ 8.36 |
Vested | $ / shares | 8.36 |
Forfeited | $ / shares | 8.35 |
Nonvested as of June 30, 2018 | $ / shares | $ 8.38 |
2015 Incentive Plan [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Nonvested as of July 1, 2017 | shares | 1,110,457 |
Granted | shares | 578,726 |
Vested | shares | (282,903) |
Forfeited | shares | (102,402) |
Nonvested as of June 30, 2018 | shares | 1,303,878 |
Nonvested as of July 1, 2017 | $ / shares | $ 22.50 |
Granted | $ / shares | 28.64 |
Vested | $ / shares | 21.89 |
Forfeited | $ / shares | 24.13 |
Nonvested as of June 30, 2018 | $ / shares | $ 25.23 |
Stock-based Compensation - Weig
Stock-based Compensation - Weighted Average Assumptions Used for Fair Values of the Options Using Black-Scholes Option Pricing Model (Detail) - $ / shares | 12 Months Ended | ||
Jun. 30, 2018 | Jul. 01, 2017 | Jul. 02, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Dividend Yield | 0.00% | ||
Options | 2015 Incentive Plan [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Risk-free Interest Rate | 2.00% | 1.30% | 1.56% |
Dividend Yield | 0.00% | 0.00% | 0.00% |
Expected Volatility | 32.00% | 33.00% | 37.94% |
Expected Term (in years) | 6 years 3 months | 6 years 3 months | 6 years 3 months |
Weighted Average Fair Value of Awards Granted | $ 10.22 | $ 9.10 | $ 7.55 |
Segment Information - Additiona
Segment Information - Additional Information (Detail) | 12 Months Ended |
Jun. 30, 2018Segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 3 |
Segment Information - Schedule
Segment Information - Schedule of Segment Reporting Information, by Segment (Detail) - USD ($) $ in Millions | 12 Months Ended | ||||
Jun. 30, 2018 | Jul. 01, 2017 | Jul. 02, 2016 | |||
Segment Reporting Information [Line Items] | |||||
Net sales | $ 17,619.9 | $ 16,761.8 | $ 16,104.8 | ||
EBITDA | 384.1 | 338.7 | 317 | ||
Depreciation and amortization | 130.1 | 126.1 | 118.6 | ||
Capital expenditures | 140.1 | 140.2 | [1] | 119.7 | [1] |
Performance Foodservice [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 10,420.4 | 9,813.3 | 9,608.9 | ||
EBITDA | 330.6 | 320 | 303.2 | ||
Depreciation and amortization | 58.7 | 57.4 | 63.2 | ||
Capital expenditures | 83.8 | 91.6 | 67.5 | ||
PFG Customized [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 3,658.1 | 3,819.5 | 3,781.1 | ||
EBITDA | 29.5 | 25.3 | 34.1 | ||
Depreciation and amortization | 14.6 | 16.1 | 15.4 | ||
Capital expenditures | 16.6 | 9.5 | 8.2 | ||
Vistar [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 3,338.5 | 3,001 | 2,698.8 | ||
EBITDA | 133.1 | 117.7 | 110.1 | ||
Depreciation and amortization | 27.4 | 24.6 | 18.2 | ||
Capital expenditures | 18.4 | 6.4 | 13.4 | ||
Corporate & All Other [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 202.9 | 128 | 16 | ||
EBITDA | (109.1) | (124.3) | (130.4) | ||
Depreciation and amortization | 29.4 | 28 | 21.8 | ||
Capital expenditures | 21.3 | 32.7 | 30.6 | ||
Eliminations [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | (260.2) | (232.8) | (215.6) | ||
Eliminations [Member] | Performance Foodservice [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 10.8 | 9.1 | 7.4 | ||
Eliminations [Member] | PFG Customized [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 0.4 | 1.3 | 1 | ||
Eliminations [Member] | Vistar [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 2.5 | 2.6 | 2.7 | ||
Eliminations [Member] | Corporate & All Other [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 246.5 | 219.8 | 204.5 | ||
Operating Segments [Member] | Performance Foodservice [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 10,431.2 | 9,822.4 | 9,616.3 | ||
Operating Segments [Member] | PFG Customized [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 3,658.5 | 3,820.8 | 3,782.1 | ||
Operating Segments [Member] | Vistar [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 3,341 | 3,003.6 | 2,701.5 | ||
Operating Segments [Member] | Corporate & All Other [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | $ 449.4 | $ 347.8 | $ 220.5 | ||
[1] | The consolidated statements of cash flows for the fiscal years ended July 1, 2017 and July 2, 2016 have been adjusted to reflect the adoption of ASU 2016-08, Statement of Cash Flows (Topic 230): Restricted Cash. The consolidated statements of cash flows explain the change during the periods in the total of cash and restricted cash. Therefore, restricted cash activity is included with cash when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. Cash payments of $7.3 million in fiscal 2016 related to insurance claims paid using restricted cash is classified as a change in Accrued expenses and other liabilities within Net cash provided by operating activities. Refer to Note 3 for further discussion. |
Segment Information - Summary A
Segment Information - Summary Assets by Reportable Segment, Excluding Intercompany Receivables (Detail) - USD ($) $ in Millions | Jun. 30, 2018 | Jul. 01, 2017 |
Segment Reporting Information [Line Items] | ||
Total assets | $ 4,000.9 | $ 3,804.1 |
Performance Foodservice [Member] | ||
Segment Reporting Information [Line Items] | ||
Total assets | 2,267.9 | 2,161.2 |
PFG Customized [Member] | ||
Segment Reporting Information [Line Items] | ||
Total assets | 644.3 | 667.1 |
Vistar [Member] | ||
Segment Reporting Information [Line Items] | ||
Total assets | 739 | 654.5 |
Corporate & All Other [Member] | ||
Segment Reporting Information [Line Items] | ||
Total assets | $ 349.7 | $ 321.3 |
Segment Information - Summary S
Segment Information - Summary Sales Mix for Principal Product and Service Categories (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2018 | Jul. 01, 2017 | Jul. 02, 2016 | |
Segment Reporting Information [Line Items] | |||
Total sales | $ 17,619.9 | $ 16,761.8 | $ 16,104.8 |
Center of the Plate [Member] | |||
Segment Reporting Information [Line Items] | |||
Total sales | 5,693.4 | 5,520.5 | 5,187.5 |
Frozen Foods [Member] | |||
Segment Reporting Information [Line Items] | |||
Total sales | 2,365 | 2,195.3 | 2,101.3 |
Refrigerated and Dairy Products [Member] | |||
Segment Reporting Information [Line Items] | |||
Total sales | 2,217.3 | 2,093.7 | 2,081.7 |
Canned and Dry Groceries [Member] | |||
Segment Reporting Information [Line Items] | |||
Total sales | 2,205.1 | 2,146.6 | 2,172.8 |
Beverage [Member] | |||
Segment Reporting Information [Line Items] | |||
Total sales | 1,495.2 | 1,433.5 | 1,315.2 |
Paper Products and Cleaning Supplies [Member] | |||
Segment Reporting Information [Line Items] | |||
Total sales | 1,351.8 | 1,291.6 | 1,241.4 |
Candy [Member] | |||
Segment Reporting Information [Line Items] | |||
Total sales | 773.4 | 706.8 | 687.2 |
Snack [Member] | |||
Segment Reporting Information [Line Items] | |||
Total sales | 730.9 | 627.2 | 578.6 |
Produce [Member] | |||
Segment Reporting Information [Line Items] | |||
Total sales | 511.1 | 490.6 | 507.7 |
Theater and Concession [Member] | |||
Segment Reporting Information [Line Items] | |||
Total sales | 190 | 156 | 144.2 |
Merchandising and Other Services [Member] | |||
Segment Reporting Information [Line Items] | |||
Total sales | $ 86.7 | $ 100 | $ 87.2 |
Schedule 1 - Registrant's Con88
Schedule 1 - Registrant's Condensed Financial Statements - Condensed Balance Sheets (Detail) - USD ($) $ in Millions | Jun. 30, 2018 | Jul. 01, 2017 | Jul. 02, 2016 | Jun. 27, 2015 |
Current assets: | ||||
Cash | $ 7.5 | $ 8.1 | ||
Total current assets | 2,203.5 | 2,084.9 | ||
Total assets | 4,000.9 | 3,804.1 | ||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||
Total liabilities | 2,865.6 | 2,878.6 | ||
Commitments and contingencies | ||||
Shareholders’ equity: | ||||
Common Stock: $0.01 par value per share, 1.0 billion shares authorized, 103.2 million shares issued and outstanding as of June 30, 2018; 1.0 billion shares authorized, 100.8 million shares issued and outstanding as of July 1, 2017 | 1 | 1 | ||
Additional paid-in capital | 861.2 | 855.5 | ||
Retained earnings | 264.8 | 66.6 | ||
Total shareholders’ equity | 1,135.3 | 925.5 | $ 802.8 | $ 493 |
Total liabilities and shareholders’ equity | 4,000.9 | 3,804.1 | ||
Parent Company [Member] | ||||
Current assets: | ||||
Income tax receivable | 11.6 | 10.7 | ||
Total current assets | 11.6 | 10.7 | ||
Investment in wholly owned subsidiary | 1,184.2 | 956.2 | ||
Total assets | 1,195.8 | 966.9 | ||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||
Intercompany payable | 60.5 | 41.4 | ||
Total liabilities | 60.5 | 41.4 | ||
Commitments and contingencies | ||||
Shareholders’ equity: | ||||
Common Stock: $0.01 par value per share, 1.0 billion shares authorized, 103.2 million shares issued and outstanding as of June 30, 2018; 1.0 billion shares authorized, 100.8 million shares issued and outstanding as of July 1, 2017 | 1 | 1 | ||
Additional paid-in capital | 861.2 | 855.5 | ||
Retained earnings | 273.1 | 69 | ||
Total shareholders’ equity | 1,135.3 | 925.5 | ||
Total liabilities and shareholders’ equity | $ 1,195.8 | $ 966.9 |
Schedule 1 - Registrant's Con89
Schedule 1 - Registrant's Condensed Financial Statements - Condensed Balance Sheets (Parenthetical) (Detail) - $ / shares | Jun. 30, 2018 | Jul. 01, 2017 |
Condensed Balance Sheet Statements Captions [Line Items] | ||
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued | 103,200,000 | 100,800,000 |
Common stock, shares outstanding | 103,200,000 | 100,800,000 |
Parent Company [Member] | ||
Condensed Balance Sheet Statements Captions [Line Items] | ||
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued | 103,200,000 | 100,800,000 |
Common stock, shares outstanding | 103,200,000 | 100,800,000 |
Schedule 1 - Registrant's Con90
Schedule 1 - Registrant's Condensed Financial Statements - Condensed Statements of Operations and Comprehensive Income (Detail) - USD ($) $ in Millions | 12 Months Ended | ||||
Jun. 30, 2018 | Jul. 01, 2017 | Jul. 02, 2016 | |||
Condensed Statement Of Income Captions [Line Items] | |||||
Operating expenses | $ 2,039.3 | $ 1,913.8 | $ 1,807.8 | ||
Operating loss | 253.5 | 211 | 202.2 | ||
Income tax (benefit), reported | (5.1) | 61.4 | 46.2 | ||
Net income | 198.7 | 96.3 | [1] | 68.3 | [1] |
Other comprehensive income (loss) | 5.4 | 8.2 | (1.3) | ||
Total comprehensive income | 204.1 | 104.5 | 67 | ||
Parent Company [Member] | |||||
Condensed Statement Of Income Captions [Line Items] | |||||
Operating expenses | 3.3 | 5.8 | 5.3 | ||
Operating loss | (3.3) | (5.8) | (5.3) | ||
Income tax (benefit), reported | (1) | (2.2) | (1.9) | ||
Loss before equity in net income of subsidiary | (2.3) | (3.6) | (3.4) | ||
Equity in net income of subsidiary, net of tax | 201 | 99.9 | 71.7 | ||
Net income | 198.7 | 96.3 | 68.3 | ||
Other comprehensive income (loss) | 5.4 | 8.2 | (1.3) | ||
Total comprehensive income | $ 204.1 | $ 104.5 | $ 67 | ||
[1] | The consolidated statements of cash flows for the fiscal years ended July 1, 2017 and July 2, 2016 have been adjusted to reflect the adoption of ASU 2016-08, Statement of Cash Flows (Topic 230): Restricted Cash. The consolidated statements of cash flows explain the change during the periods in the total of cash and restricted cash. Therefore, restricted cash activity is included with cash when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. Cash payments of $7.3 million in fiscal 2016 related to insurance claims paid using restricted cash is classified as a change in Accrued expenses and other liabilities within Net cash provided by operating activities. Refer to Note 3 for further discussion. |
Schedule 1 - Registrant's Con91
Schedule 1 - Registrant's Condensed Financial Statements - Condensed Statements of Cash Flows (Detail) - USD ($) $ in Millions | 12 Months Ended | |||||
Jun. 30, 2018 | Jul. 01, 2017 | Jul. 02, 2016 | ||||
Cash flows from operating activities: | ||||||
Net income | $ 198.7 | $ 96.3 | [1] | $ 68.3 | [1] | |
Changes in operating assets and liabilities, net | ||||||
Net cash provided by operating activities | 367 | 201.7 | [1] | 228.5 | [1] | |
Cash flows from investing activities: | ||||||
Net cash used in investing activities | (209.4) | (332) | [1] | (157.6) | [1] | |
Cash flows from financing activities: | ||||||
Proceeds from exercise of stock options | 12.3 | 4 | [1] | 1.3 | [1] | |
Net proceeds from initial public offering | [1] | 226.4 | ||||
Cash paid for shares withheld to cover taxes | (28.2) | (3.5) | [1] | (0.9) | [1] | |
Net cash (used in) provided by financing activities | (160.8) | 127.5 | [1] | (76.5) | [1] | |
Net decrease in cash and restricted cash | (3.2) | (2.8) | [1] | (5.6) | [1] | |
Cash and restricted cash, beginning of period | [1] | 21 | 23.8 | 29.4 | ||
Cash and restricted cash, end of period | 17.8 | 21 | [1] | 23.8 | [1] | |
Parent Company [Member] | ||||||
Cash flows from operating activities: | ||||||
Net income | 198.7 | 96.3 | 68.3 | |||
Adjustments to reconcile net income to net cash provided by (used in) operating activities | ||||||
Equity in net income of subsidiary | (201) | (99.9) | (71.7) | |||
Changes in operating assets and liabilities, net | ||||||
Intercompany payables | 19.1 | 5.2 | 7.9 | |||
Income tax receivable | (0.9) | (2.1) | (1.9) | |||
Net cash provided by operating activities | 15.9 | (0.5) | 2.6 | |||
Cash flows from investing activities: | ||||||
Capital contributed to subsidiary | (229.4) | |||||
Net cash used in investing activities | (229.4) | |||||
Cash flows from financing activities: | ||||||
Proceeds from exercise of stock options | 12.3 | 4 | 1.3 | |||
Net proceeds from initial public offering | 226.4 | |||||
Cash paid for shares withheld to cover taxes | (28.2) | (3.5) | (0.9) | |||
Net cash (used in) provided by financing activities | (15.9) | 0.5 | 226.8 | |||
Net decrease in cash and restricted cash | [2] | 0 | 0 | |||
Cash and restricted cash, beginning of period | [2] | $ 0 | 0 | 0 | ||
Cash and restricted cash, end of period | [2] | $ 0 | $ 0 | |||
[1] | The consolidated statements of cash flows for the fiscal years ended July 1, 2017 and July 2, 2016 have been adjusted to reflect the adoption of ASU 2016-08, Statement of Cash Flows (Topic 230): Restricted Cash. The consolidated statements of cash flows explain the change during the periods in the total of cash and restricted cash. Therefore, restricted cash activity is included with cash when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. Cash payments of $7.3 million in fiscal 2016 related to insurance claims paid using restricted cash is classified as a change in Accrued expenses and other liabilities within Net cash provided by operating activities. Refer to Note 3 for further discussion. | |||||
[2] | The condensed statements of cash flows for the fiscal years ended July 1, 2017 and July 2, 2016 have been adjusted to reflect the adoption of ASU 2016-08, Statement of Cash Flows (Topic 230): Restricted Cash. Refer to Note 3 for further discussion. |
Schedule 1 - Registrant's Con92
Schedule 1 - Registrant's Condensed Financial Statements - Description of Performance Food Group Company - Additional Information (Detail) | 12 Months Ended |
Jun. 30, 2018 | |
Parent Company [Member] | |
Condensed Financial Statements, Captions [Line Items] | |
Date of incorporation | Jul. 23, 2002 |