09:43 AM EDT, 08/14/2024 (MT Newswires) -- Performance Food Group ( PFGC ) said Wednesday that it agreed to buy Cheney Bros for $2.1 billion in cash, while its fiscal fourth-quarter earnings rose more than expected even as revenue missed estimates.

Performance Food ( PFGC ) said Wednesday that the acquisition of the Florida-based foodservice company would expand its presence in the Southeastern US. The transaction is expected to close in calendar year 2025, subject to antitrust clearance. Cheney Bros generates about $3.2 billion in annual revenue, according to a statement.

"This acquisition will expand and enhance our offerings to a high-quality and diverse customer base," Performance Food ( PFGC ) Chief Executive George Holm said in a statement.

Foodservice distributor Performance Food ( PFGC ) expects the transaction to be accretive to its adjusted per-share earnings by the end of the first full fiscal year. The acquisition adds five distribution facilities for further growth across Florida, Georgia, North Carolina and South Carolina, it said.

"I believe this transaction will bring together two winning organizations and create a significant platform for growth," Cheney Bros CEO Byron Russell said.

For the quarter ended June 29, Performance Food's ( PFGC ) revenue increased to $15.19 billion from $14.87 billion the year earlier, but missed the Capital IQ-polled consensus of $15.25 billion. Adjusted EPS increased to $1.45 from $1.14 last year, beating market expectations of $1.37.

Adjusted earnings before interest, taxes, depreciation and amortization rose about 18% to $456.2 million.

By segment, foodservice sales increased 4.6% year over year to $7.65 billion driven by case volume growth in the company's independent and chain business. Convenience sales slipped 0.5% to $6.26 billion due to a decline in cigarette carton sales and center of the store cases sold, partially offset by an increase in selling price per case. Vistar revenue fell 1.8% to $1.2 billion because of declines in theater cases sold.

For the fiscal first quarter, the company expects net sales in the range of $15.2 billion to $15.5 billion, compared with analysts' $15.54 billion view. Performance Food ( PFGC ) projects first-quarter adjusted EBITDA between $400 million to $420 million. For fiscal 2025, Performance Food ( PFGC ) expects net sales of $60 billion to $61 billion, compared with the $60.75 billion consensus view. The company pegged full-year adjusted EBITDA between $1.6 billion and $1.7 billion, versus $1.51 billion in underlying profitability reported for fiscal 2024.

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