U.S. Foodservice, the second-largest national food-service distributor, reported fiscal first-quarter earnings yesterday that beat analysts' expectations by a penny and said it would continue its strategy of expansion through acquisition.
The Columbia company said it had net income of $23.1 million, or 23 cents per diluted share, in its first quarter.
Nine analysts surveyed by Zacks Investment Research expected U.S. Foodservice to make 22 cents a share in the quarter.
Net income for the three months that ended Oct. 2 rose 37 percent, from $16.9 million, or 18 cents per diluted share, in the fiscal first quarter of 1999. Sales in the quarter were up 13.3 percent, to $1.7 billion from $1.5 billion a year ago.
Half of the earnings growth came from U.S. Foodservice's acquisitions during the past 12 months, while the rest came from internal growth, Treasurer Robert Gillison said.
In August, the company said it signed a letter of intent to buy privately owned Parkway Food Service of Greensburg, Pa.
This month, the company said it signed an agreement to acquire Minnesota-based Superior Products Manufacturing Co.
U.S. Foodservice will stay with that strategy, Gillison said. "We continue to talk to other companies in our business to aid us getting into new geographies or expanding our product portfolios," he said. "It's definitely our intention to be a very active acquirer."
U.S. Foodservice markets and distributes more than 44,000 national, private label and signature-brand items to more than 130,000 food-service customers and employs more than 13,000.
The company released its earnings after the market closed. Its shares rose 12.5 cents in trading on the New York Stock Exchange yesterday to close at $16.25.