a diesel fuel swap contract on a portion of the fuel exposure that is not covered by surcharges. This contract runs for a 12-month period. We're evaluating hedge accounting treatment for our fuel swap under the updated accounting standards, which could allow us to directly offset movement and fuel expense in the operating expense line. Our strategy is to provide additional visibility into our cash flow, reduce volatility, and increase our ability to forecast financial performance. Turning to our financial position and cash flow performance, over the full fiscal year of 2026, PFG generated over $1.4 billion of operating cash flow, an increase of approximately $200 million compared to last year. We invested $384.1 million in capital expenditures during 2026. We have been diligent around new capital projects and expect full-year 2027 CapEx to remain below our long-term target of 70 basis points of net revenue. The organization is striking a good balance of investing in infrastructure and high-return projects to support our long-term growth while maintaining excellent free cash flow performance. In 2026, we generated more than $1 billion of free cash flow, up approximately $326 million compared to last year. We are extremely pleased with our cash flow, and we are fully committed to investing back into our business to support our growth. We closed the fiscal year with net debt just below the top end of our 2.5 to 3.5 times leveraged target range, benefiting from disciplined working capital management and strong cash flow as a reminder the first quarter is typically a period of investment and as a result we anticipate our leverage to remain towards the top end of our range the mna pipeline remains robust and we continue to evaluate strategic mna we will continue to apply our typical high standards and robust due diligence to evaluate high quality acquisition opportunities Turning to our guidance. Today we share guidance for fiscal 2027. For the first fiscal quarter of 2027, we expect net sales to be in a range of $17.9 to $18.1 billion and adjusted EBITDA to be in a range of $510 to $530 million. We expect our quarterly EBITDA growth to accelerate as we move through the fiscal year. In addition to new business wins in all three segments, which will help our top line, we have a number of initiatives that are expected to boost our profit results, including an acceleration of our procurement efficiency efforts, comparing against elevated OpEx related to the opening of the Florence, South Carolina building, and continued progress on cost synergy targets related to M&A activities. For the full fiscal year, our sales targets are in a range of $72.5 billion to $73 billion. dollars. We expect full-year adjusted EBITDA in a range of $2.125 to $2.225 billion. Our full-year guidance range includes the benefit of a 53rd week, which will occur in the fiscal fourth quarter and helps results by approximately 2%. The midpoint of these ranges represents year-over-year growth of 7.2% for sales and 12.7% for adjusted EBITDA. This keeps us on track to achieve the three-year projections we announced at investor day with sales in a range of 73 to 75 billion dollars and just at EBITDA between 2.3 and 2.5 billion dollars in fiscal 28. to summarize we are very pleased with our progress we are in a solid financial position which supports our growth investments and capital return to our shareholders and our execution sets the stage for a strong fiscal 2027 thank you for your time today we appreciate your interest in performance food group and with that scott and i would be happy to take your questions thank you very much mr hatcher ladies and gentlemen at this time if you do have any

questions or comments please press star one if you find your question has been answered you may remove yourself from the queue by pressing star two additionally to get to as many questions as possible. We do ask that you please limit yourself to one question and one follow-up. We'll go first this morning to Kelly Bania with BMO Capital Markets.

Hi, good morning. Thanks for taking our questions. I wanted to start with just the outlook for fiscal 27. And I think, Patrick, I think I heard you say, you know, growth for all three segments, but can you share with us any more specific color by segment in terms of how they fit into the EBITDA outlook for the year? I guess really kind of in that 8% to 13% range, excluding the extra week, should they all be within that range? Or is there any outliers or any factors? And also, what is the outlook for your corporate overhead, given the improvement that you had there in the fourth quarter?

Hi, Kelly. This is Scott. Thanks for the question. A lot to unpack there. So, let me just start with growth. I think that was really the headline of the question. You know, so when we think about food service, you know, always, you know, internally, we are focused on independent account growth and independent case growth. and so certainly internally we're always shooting for that six percent uh and so that that will certainly be a driver when we talked about our case volume uh for for national uh you know we we were a little bit negative this year that was largely based on the macro but we did talk about jersey mics that will come in in the back half of the year so that would be a really nice boost in our national account so really a good a good pipeline uh beyond that with national accounts so from a food service standpoint feel really good about the growth algorithm that we'll see in 27 convenience you know we obviously have the benefit of loves and racetrack uh continued strong pipeline there uh and their continued out performance and then you know specialty has been a really nice story for the last three quarters they've accelerated and really uh have great line of sight to continue growth and specialty we talked about a couple of new verticals we're working on that are starting to pay dividends. So if we're really, really good about the growth perspectives for 27, and I'll just touch on margins, and I'll let Patrick talk about the expenses. And from a margin standpoint, again, the mix that I just talked about will really help drive margins. Then we've talked a lot about our procurement synergies, and we have great line of sight as we move through 27. That's going to be a building story, but really have a great visibility into quarter-by-quarter where we'll see gains in procurement synergy. So, Phil, top half of the income statement, we feel great about how we're set up for 27. And Patrick, if you want to touch on the expense side.

Yeah, Kelly, just a couple more things on OPEX. Obviously, talking about the full-year guidance, we're going to see in Q3 and Q4 specifically, we'll start to see easier comps related to the Cheney OPEX that we've talked about for the last couple of quarters, moving into the new Florence building, as well as, you know, we obviously had some fuel pressures at the end of Q3 and Q4 that we'll start to see those ease in the balance of half of this year. And then finally, is your question on corporate? Again, that's really a segment thing. It's related to safety. We saw great progress in our trends with our segment. That did improve, and we saw that benefit flow into corporate in Q4, you know, the trends are in a positive momentum, so we should see some improvement. Lots of different dynamics go into those numbers, but that's all incorporated in the Q1 and the full-year guidance.

Okay. And maybe just to follow up, you talked about some good visibility into the procurement savings and the initiative there maybe could you just expand on you know what which segment that will flow through or maybe all of them and just what you're learning through that process as you have those discussions with vendors yeah kelly it's a great question and and as far as the flow through most of that flows through food service that's been the real focus of that initiative you know as we move into the back half of the year we'll also add cheney's volume to that so So that will certainly help with their procurement synergies as well.

And then, you know, as far as the interaction that we've had that gives us great visibility, we've really sat down with our entire vendor community and really walked through, you know, our growth over the last five years and the prospects that that creates for them around efficiency, you know, how we approach the supply chain. So really it's been a win-win for both sides. and we've had great dialogue and, you know, we've had great negotiations. And through that, you know, it's given us, like I said, great visibility kind of quarter to quarter of when we'll start to see those benefits flow through the income statement.

Thank you. We'll go next now to John Heinbuckle with Guggenheim.

Hey, guys, I want to start top line. Patrick, you mentioned 1%, I think it was 1% food service inflation in July. So what, you know, what kind of took that down? And is that temporal? You know, what are you budgeting for the year? And then maybe for Scott, the drop size, right? So drop size was up 1% or just about, I assume, right, you know, cases per line were down and penetrations up. What's your sense of that for the balance of the year?

Yeah, John, I'll start and then turn it over to Scott on the second question. So on inflation, we did exit the quarter in that range exactly as we had projected. I think we said sub three and we ended up two seven. Did call out that July dropped to sub one in food service. Largely, we obviously always are managing a large basket of commodities and we do an excellent job of managing those. What we saw in July is that actually beef is starting to lap this mid-teen inflation from prior year and now is running kind of a high single digit so maybe it's early signs of beef normalizing and then the other commodities that we continue to see deflation in our cheese chicken and eggs but those have been relatively stable from a month-to-month standpoint and I'll turn over to and then oh I'm sorry and as far as how we modeled the year food service we did model in that low single digit around two percent um for the year and uh the other segments uh very

similar to how we exited q4 with uh fifth star mid single digits and convenience just slightly higher than that hi john on the on the question around independent cases uh so you as you pointed out really nice quarter as far as penetration most of that was lines per drop um so continuing to benefit from our salespeople and their connection to our customers. You know, I think another big part of that is just the technology that we are now putting in front of our salespeople and our customers. It's really helping with recommendations, you know, new item selection. So that, I think that's really been a nice benefit to penetration. So that's been back-to-back quarters where we've seen nearly 100 basis points of penetration. And again, that's really driven by lines for drop. You know, at the end of the day, though, the real, you know, driver of market share win has been net new accounts. You know, we came in again right around 5%, you know, so that's four consecutive quarters in that range. And that's going to continue to be the driver. It's really nice to see the penetration. You know, hopefully that continues. Love to see that grow. But, you know, again, we're really focused on that net new account number as well.

And quick follow-up for Scott. You guys don't talk as much about labor productivity, but I'm curious, you know, from a margin standpoint, right, cases per hour, per labor hour, and cases per mile driven, what is, when you look at going after that and the ability to move the dial, where are we on that?

Yeah, John, I think it's a big opportunity. It's one of the places where, you know, when we talk about technology, I think there's been a lot of conversation in our industry about AI. You know, I'll start with fleet. You know, we have done a lot of work on evaluating fleet utilization as well as our routing technologies. And we deploy, you know, standard software plus, you know, AI enablement that helps that. And so certainly I think there's runway there. We have always been focused on our routing and routing efficiency, but definitely I think there will continue to be runway. And then the other place is in our warehouse, and I think there's really two things there that I focus in on. One of them is really technology-enabled, which is really how we lay out our warehouses, so how you slot your facilities to optimize that pick path. The other thing that we're doing technology-wise is around inventory management. So, we have been running a test now and have expanded that, you know, fairly rapidly around inventory counts using drone technology. So, again, you know, leveraging technology to be more efficient in our facilities. And when I think about metrics, you know, I really look at, you know, we'll call it cases per route. You know, that's a key metric for us. We're constantly focused on improving our cases per route. And then, you know, to your point, it's really, it's either cost per case or, you know, from a selection standpoint, you know, it's how many units a selector selects in an hour. So, you know, it's our productivity metrics that we really hone in on.

Thank you. Thank you. We'll go next now to Edward Kelly with Wells Fargo.

Yeah, hi. Good morning, guys. Thanks for taking my question. I wanted to start with the guidance, and I was really hoping that you could maybe dissect, you know, how you lap some of these one-time issues in terms of what you were thinking about for 27. I mean, if we think about Cheney, I don't know, maybe this is a $30, $40 million drag, you know, in 26, and then you have synergies ramping. It seems like that would be a big inflection. You know, fuel, I don't know, maybe that's more neutral now if that continues into the first half. deflation, Herb, you have a cash flow deal coming in. I guess what I'm trying to say at the end of the day is that the EBITDA guide X to 53rd week is within the range, but it seems like you have a number of idiosyncratic drivers to do much better than that, and I'm just trying to figure out what's in the guidance for that.

Yeah, Ed, let me start, and if Scott wants to add some comments, certainly can do that too as well. I mean, I think one of the key points is we provided Q1 guidance to really show the cadence of the year. I just want to make sure that we're showing that, you know, Q1, we're exiting Q4 with some strong momentum, but we do have some of those headwinds like fuel still impacting us. And we actually expect the headwind in fuel Q1 to be very similar to what it was in Q4, maybe just slightly better. And then we'll see our acceleration on the top line, obviously, from the customer stuff that Scott ran through. But, you know, the things that you're bringing up, we think that as we get into the second half of the year specifically, that's when you start to see the benefit of us lapping that OpEx from Cheney. And, you know, I think we sized that up in Q3 and Q4 as well. It's probably not as big as you highlighted there. But we do see some benefits there, obviously. And then the fuel becomes neutral to possibly a tailwind as we go throughout the year. But we did plan for fuel to be a higher expense this year based on how we exit a key four. And then, you know, we've talked about cashway. And, yeah, so we really think that those are the key factors that are going to help us achieve that guidance.

And we're really happy with, you know, where we are. and obviously scott mentioned the procurement savings those will ramp throughout all of 27 and all the way through 28 so again it's really a year of acceleration yeah let me just add a couple more things you know we're uh we're a couple months into the year um i think when we think about guidance you know there's there's obviously a range for a reason you know we think about you know the current state of the macro and how we're performing and um you know certainly if If we deliver that, we think about that getting us to the middle end of that range. If we get some tailwinds, you know, certainly, you know, focus on getting to the upper end and, you know, then, you know, don't want to talk about it, but if there's headwinds, you know, certainly that could push you to the lower end of the range. And so that's, you know, I think how we think about framing up the range. I do want to just touch on a couple other things. You know, you brought up Chaney, and, you know, Chaney has certainly been an expense headwind over the last couple quarters. We'll see that persist a little bit into Q1, but really we've turned the corner there. That facility in Florence is fully rolled out. That actually is the fastest growing as far as case volume facility in the southeast for us. So they've really kind of hit the ground running. And the other comment I'd make about just the Cheney infrastructure, we talked a little bit about Jersey Mike's in the back half of the year. And that's, you know, know, that's volume that we probably wouldn't have been able to bid on or bid on effectively without the infrastructure of Cheney. So, you know, that investment is really going to pay off as we get to the back half of the year and be able to fit in that volume into great facilities, great infrastructure. And, you know, that should really help us deliver, you know, from a bottom line standpoint. So I think Patrick touched on the highlights for me. It's growth across all three segments. It's procurement synergies. It's lapping some key costs. And then, you know, certainly with Chaney, we'll grow in momentum throughout the year.

And, Scott, can I just ask you on the, you know, the cost savings side? I think I've heard you talk about, you know, sort of like a, you know, greater focus on sort of the middle of the P&L, you know, moving forward. And certainly looking at the margins of the company, it seems like they're, you know, from 30,000 feet anyway. It seems like there could be some real opportunity. Can you maybe just update us on sort of like what you think, you know, you guys can do there over time and the size of the opportunity in terms of a generally more efficient organization?

Yeah, I'd say from a gross profit standpoint, you know, I was really happy with how we exited the year. I mean, we had one of the best performances in Q4 in GP across the organization that we've had, you know, in the last handful of years. That said, certainly feel really strong about the procurement opportunity, and I frame that up in my script, you know, as far as the $120 to $125 million, you know, and a good portion of that falls into $27 and $28, and that will build through $27 and continue on into $28. When you talk more about efficiency, call it the bottom half of the income statement, I certainly think there are opportunities. I think we've kind of framed that up in our three-year guide. When you talk about 50 to 60 basis points of margin enhancement, but the things I talked about earlier on the question from John really about what we're doing with fleet, fleet utilization, where we're leveraging technology in the supply chain, you know, I think that's going to really help us. And so that's, you know, when we frame up that three year, I think that's how I think about the opportunity is being able to really add, you know, that 50 or 60 BIPs to EBITDA margins. Thanks, guys.

Thank you. We'll go next now to Mark Cardin with UBS.

Hi, this is Matt Rothway on for Mark Cardin. Thank you for taking our question. So, I was wondering if you could share a little bit more about the cadence of independent case growth in the quarter and maybe how it's trending quarter to date. Thank you.

Yeah, great question. You know, one of the things I just want to take a step back and, you know, maybe a shout out to our sales organization, you know, to finish the year at 5.9 and change. You know, I've talked earlier on this call about, you know, us targeting internally 6%. And we almost got there. I wish we had a six handle on it, but it was a great year from an independent case growth standpoint. In Q4, we were at 5.8, which we were really proud of considering that on a two-year stack, that's right at 12%. So really solid performance there. When I think about the cadence of Q4, we were, I think in April, I think it was right around just under 6%. I think May was right at 6% and our exit in June was just sub 6%, just a couple ticks below. So, and then we entered July kind of in that same range, just a couple ticks below 6%. So, you know, still really focused, you know, for the quarter on the year as a company on being right around that 6% range and feel like we've got the pieces in place to get that done. Great.

And then any noticeable lift from the World Cup or sporting events like that? Thank you.

You know, it's a good question. We spent a fair amount of time kind of dissecting the bigger markets. You know, you think about Boston and Kansas City and Dallas and, you know, places where we have facilities and quite a bit of presence. I wouldn't say that we saw anything that, you know, was earth-shattering. You know, we saw some short-term lift around event days, but really nothing that I would say, you know, created meaningful, you know, volume differential because of the World Cup in our space.

Thank you. We're next now to Lauren Silberman with Deutsche Bank.

Thank you very much. I just wanted to start on the convenience case side. I think, Scott, you mentioned some new business wins, offset by some losses. Can you expand on what you're seeing in that segment from a competitive environment and any color on how to think about convenience in fiscal 27? I think you guys admitted high single in QQ, 3Q, 3.4% in 4Q, so just trying to understand some of those dynamics.

Yeah, no, great question. And as you mentioned, I mean, this year was, I wouldn't call this a normal year from a growth standpoint. I mean, we had an exceptional year, two big, you know, iconic retailers. So certainly drilled case growth and sales growth in the higher single digit range. You know, I would say historically, convenience is, you know, low single digit range revenues and, you know, really strong, you know, high single digit, low double digit EBITDA performance. That's how I think about a normal convenience algo for that segment. As I think about 27 and how that's going to frame up, I mean, certainly we'll see some nice benefit in the first couple of quarters from Loves and Racetrack. In the back half, we certainly have some really nice pipeline opportunities that will help us in the back half. We have had a couple of competitive losses that I would say were just priced at a level where we weren't going to stay there. But Phil, you know, like that segment, you know, I go back five years, that segment has continued to gain share quarter over quarter, year after year. And so I think the back half of the year setup is really strong. You're going to see nice growth, continued market share gains, and nice EBITDA performance for them, you know, even as we lap loves and racetrack. So I think it's, you know, they're set up for a really solid year.

Great. And then I wanted to follow up on like operating leverage. So 26 driven by gross profit, OPEX, we've talked about some of those dynamics. How are you thinking about gross margin versus OPEX in fiscal 27. And I just wanted to clarify the Cheney piece. Are you saying you expect Cheney to remain a slight drag in Q1, or is it just not a headwind in Q1 and starts to become a tailwind in Q2? Just trying to understand that. Thank you.

Yeah, maybe I'll take the first part. And yeah, so Lauren, as we go into 27, we actually, you know, one is we highlight or Scott highlighted our gross profit margin was really strong for the total company and key four and for food service at you know 15 was very strong probably the best it's been and we continue to see really nice gross profit accretion due to our mix due to the procurement initiatives and so we should see some really nice leverage again as scott's highlighted all the activities that we're doing around below the bottom half of the P&L on OPEX. So we do believe that we will see nice secretion. And, again, it's an acceleration as we go throughout the year. So, again, as I mentioned, we're going to see more fuel pressure this quarter, but we do expect that all to dissipate as we get into the comps in the back half of the year.

Yeah, and, Lauren, I'll take the second half around Cheney. So one of the things to remember about them is seasonality-wise, they're kind of contra the rest of the country. So this is really a soft quarter for them, our Q1. They build in Q2 and Q3. That's really their season. So I would say they're minimal headwind to neutral in the first quarter, but their momentum will really build as we move throughout the year. And the reason we have so much confidence in that is, I mentioned earlier, the Florence facility is fully operational, operating really well and growing faster than any opco that we have in the southeast right now so that's you know i guess one headline the other piece would be the the jersey mics i mentioned and being able to to flow that into not just the cheney facilities in the southeast we are you know that will flow into some of our legacy facilities as well but without cheney that would have been a real challenge so that that really makes it you know a great opportunity for us and then we've talked about structurally as we get into the two year lap of that acquisition, which is in October. There is some structural costs to come out in October. They start coming out for next year. And then we are starting to, with our brands, with our procurement initiative to incorporate Chaney into all of those activities. And so we have a great line of sight to building synergies with them as we move through 27 and into 28. Great.

Thank you very much.

We'll go next now to Alex Slagle with Jeffries.

Thanks. Good morning. I wanted to ask any thoughts on interest expense, debt pay-down expectations, just to help us sort of get a feel for earnings, UPS growth relative to the EBITDA growth outlook.

Yeah, Alex, thanks for the question. So, as we look, you know, what we saw in Q4 and we go forward into, you know, 27 guidance below-the-line items, you know, I think the street did a really nice job of modeling some of those below-the-line items. Interest expense specifically should stay relatively flat for the balance of 27. We'll see some improvement towards the end of 27. But I think if you would model it very similar to how we exited Q4, that'll be a good direction. Okay.

Then on headcount growth in the food service business in the fourth quarter, I know you're lacking some really strong growth last year, upwards of 9%.

Kind of get some color on that and what to expect for 27 as you look for that 6% case growth target that was looked at. yeah no absolutely and as you pointed out we had a you know really strong year last year in head count growth i mean we were eight percent plus for most of the year and i think some of that that was you know i i think heightened a little bit by some of the activities that were going on with competition and and changes they were making in their models so it was really a nice opportunity for us to to pick up really quality head count you know through this whole year i'd say it's been very consistent. We've been right there in the mid-signal digit range, finding great talent available in the market. And, you know, I've said many times, I don't have a target or a mandate on our OPCOs. You know, I really rely on the OPCOs and our OPCO presidents to determine, you know, their correct level of staffing. And as I look OPCO to OPCO, we may have OPCOs that are higher in, you know, double digits right now because they see great growth opportunity and and they know that they need to get people in place to satisfy that. And we have other opcos that feel like they've got the right headcount, and they may be hiring low single digits. So I'd say it's, you know, like I said, really up to them. I think as a company we feel really comfortable in that mid-single-digit range, and, you know, I think that, you know, I would be surprised if that's what we saw continue through 27.

Great.

Thanks a lot.

Thank you.

We'll go next now to Andrew Charles with TD Cowan.

Okay, great. um can you start off by talking about your free cash flow priorities for 2027 you mentioned you're keeping a close eye on mna but you still have the lion's share of the 500 million dollar uh share purchase authorization through 2029 remaining and i'm curious you know are these two priorities mutually exclusive yeah so uh good question obviously um and when we think about how we look at our capital allocation uh you know we are continuing to look at how we reduce our leverage, pay down debt.

And then we're also, and we're really happy that we got within the two and a half to three and a half times leverage range. That's our target. We also are still investing in capacity. I mean, we're a growth company and we continue to invest in growth projects for primarily food service, but across all three segments. And we are obviously still looking at M&A. The share repurchase program is something we look at all the time. It's not the top three priorities, but it becomes a bigger priority as we get further within our leverage range.

That's helpful. And then maybe just on technology, just kind of curious where you are within the PFG1 journey on this. Are you beginning to harvest the data, procurement, and operating benefits of the technology, or would you say you're kind of still in an investment and implementation phase with most of the benefits of technology still ahead?

No, that's a great question. You know, technology is, for us, is, you know, obviously, I think for everybody, it's been a journey. I'd say that, you know, the one thing that our exploration around AI has really helped us with is, you know, data assimilation. And so, we have a number of initiatives going on around technology and AI. You know, everything from, you know, just organic users that are using large language models to our customer-facing technologies that has a lot of AI enablement. To get to the specific of your question, you know, one of the things that we are working on today with a couple of external partners is, you know, I'll call it master data management. And that is really being able to assimilate data across all three of our business segments. And, you know, what that does for us is allow us to, you know, work with customers interchangeably, also allows us to start to look at procurement and supply chain and logistics opportunities. So certainly we are in the, I'd say, still the early innings of that exploration, but we are doing a lot of work to, you know, to figure out how we leverage that. And then outside of technology, you brought up PFG1. You know, that's one of the things that I'm really proud of our segment leaders uh you know we have three leaders a leader for each segment and they work together day in and day out and then the amount of cross sell that we do today you know where we have you know food service opcos that are supporting you know convenience stores across the country um you know and and collaboration we mentioned it in our script where we have we have our e-commerce platform through specialty, doing smallwares distribution for restaurants today. So, there are numerous examples of where our segments are working together under that PFG1 umbrella.

And technology is just, you know, another leg to that stool, but feel really good about how our segments are working together to create, you know, synergy and momentum and really helping us drive growth thank you very much thank you we'll go next now to brian harbour with morgan stanley yeah thanks good morning just um the you know acquisition impact that we saw in the fourth quarter would you expect that to be you know fairly similar through the into you know fiscal 27 at least through 3q and could you remind us how much ebitda that's adding this coming fiscal year?

So the acquisition impact, are you talking specifically about Cheney?

No, Cashway that you did most recently.

Yeah, yeah, for sure. So Cashway, you know, we haven't called out revenue specifically. It's south of a billion dollars in total revenue. The one thing that's unique about Cashway, it's kind of a reflection of PFG overall. So they are, you know, very much in broad line food service, a good mix of independent and chain and regional volume. But the other thing that's unique about Cashway is they are also very much in the convenience store space. So they sell a full line of convenience store products and have a number of convenience store customers. That's a big part of their portfolio. So when you look at them, you know, from a revenue standpoint, I kind of gave you that. When you look at them from a margin profile, you know, I think of them as something, a hybrid between convenience and food service. You know, they fall somewhere in between from a margin standpoint. But really excited to have them on board. You know, they'll be a great addition to us. They fill in great geography for us and a really great group of people that run that company. And like I said, we're glad to have them as part of the PFG family.

Okay, sounds good. When I look at OPEX in the food service segment, you know, in the quarter, I think it was up about 10%. I guess, you know, just to help us kind of think about that going forward, you know, how much of that was sort of fuel impact? How much of that was sort of just, you know, personnel versus any other kind of discrete buckets you'd call out that were driving that?

Yeah, this is Patrick. So in terms of fuel, you know, we gave you the $16 million for the quarter. The bulk of that is in food service, so that pretty much goes to food service. And then really the other OPEX challenge that we had in the fourth quarter was related to the Cheney move. In terms of personnel and those type of expenses, those were all in line. And, you know, again, we were able to achieve the upper end of our guidance, so we felt really good about the performance. And we know, you know, we have clear line of sight on the fuel expenses going forward. And as Scott already mentioned, we have a pretty good line of sight on how Cheney expenses are dissipating.

Yeah, I would just add one thing to that. And those are by far the two biggest buckets. But, you know, we certainly have an opportunity across food service, convenience, and specialty to be more operationally efficient and certainly something that we'll continue to focus on.

Thank you. We go next now to Peter Saleh with U.S. Bancorp BTIG.

Great. Thanks for taking the question. I was hoping you could elaborate a little bit more on the Jersey Mike's partnership. I think you mentioned it a couple times, but I think I heard you say that it's more a second half is when this partnership begins. If you could give us a little bit more color on the timing. The region, is it just the southeast, or what should we be expecting? and any benefit that you can quantify on the case counts in the second half?

Yeah, so Jersey Mike's, obviously, we're really excited to be partnered with them. Obviously, a great performing concept that is somewhere I like to eat myself. They do an incredible job. As far as the timing, it's middle of the year, just past middle of the year, that they'll start to flow into the network. They're a public company, so I don't want to get too much into store counts and numbers, but there was basically four regions that were in that RFP, and we have been awarded three of those regions. So certainly it would be a nice opportunity for us in the back half of the year.

Great. And then are you guys seeing any sort of discernible consumer behavior change with respect to GLP-1s, anything you guys can call out would be helpful. Thanks.

Yeah, we certainly, you know, spend a fair amount of time with, you know, with folks looking at data around GLP-1. You know, it's honestly one of the reasons I think the independent restaurant has held up pretty well is, you know, they have that real-time flexibility to change menu, to change portions. And what we're really seeing is, you know, a movement towards more proteins, a movement towards more fresh food. And then, you know, I'd say in the convenience store space, you know, I mean, they're still indulging. So there's still a lot of, you know, snack and candy being consumed, but protein is really the word of the day. And so, you know, you see out there, protein cereals, protein bars are on fire. So there is a lot of focus on protein and we're seeing a lot of shift in behavior of manufacturers around bringing brands out and new items out that satisfy that need. But certainly we're seeing a shift in behavior as that progresses.

Thank you very much.

Thank you. We'll go next now to Danilo Gargiglio with Bernstein.

Scott, it's the end of the year, so I want to ask a question that really reflects maybe the go forward for one of the things that probably are close to your heart, which is the convenience. And specifically, there are some major, major regional convenience players that are not your clients yet. So I'm wondering, obviously, some of them are vertically integrated, so you cannot access to them. But what feedback are you receiving from the clients who could be a potential client? And what are you prepared to do over the next few years to unlock these meaningful opportunities?

Well, I think it's a great question. I think, you know, Loves and Racetrack, you know, like I said, those are two iconic retailers that I think put us at the forefront of the industry as a partner that, you know, really is focused on food service growth, is a partner that's flexible. and and certainly they have great reputations and and what they share about us in the industry goes a long way and so certainly we have um been able to you know engage in new conversations because of that uh and you know continue to uh to build on our reputation and you know i think we have a great reputation as being really a customer forward supplier that is really focused on food service, focused on sales growth, and feel like our pipeline over the next two to three years is really strong, whether it be independents, regionals, or some of the bigger players in the space. So to your point, we definitely don't have them all. There's a lot of market share opportunity out there. And I feel like that team of any team is one that's aggressive on going out there and building those partnerships.

Thank you. And then, Patrick, a question regarding guidance and specifically on the labor side. I mean, we've seen some tightening in terms of availability of labor for truck drivers specifically. So, can you share your expectations on the turnover rate that you might be seeing internally and also what kind of labor cost inflations you're embedding in your guidance? And thank you.

Yeah, I'll take the part on drivers, and I'll let Patrick hit on what's embedded in the guidance. So, I would just say, you know, drivers and warehouse overall, I look at kind of three key metrics around that. I look at, you know, overtime, I look at turnover, and I look at temp labor. And, you know, really all three of those metrics have been consistent over the last couple of years. We haven't seen any material shifts in any of the three of them. We have very little, almost no temp labor in the system. We have, for the most part, manageable overtime across the network, and turnover has been basically flat over the last couple of years. That being said, and to your point, there are a couple of hotspots across the country, probably more specifically for drivers. And I wouldn't say that that's materially different this year than it was last year, But certainly something that, you know, we as a growth company are constantly focused on is making sure that we have driver availability to be able to manage the growth that we have coming to the network. So continual focus. Don't see it as a big headwind at this point, but something we're always very sensitive to.

Yeah, and just building on what Scott said, obviously, because we are really not seeing too much in terms of market dynamics in this space, our guidance is very consistent. Now, obviously, we are experiencing the higher fuel costs, so we did model that into our guidance for, as I mentioned, for the whole year at higher costs. And, again, we expect Q1 to be very similar to what we saw in Q4, but we do expect that to slowly tick down throughout the year once we start comping over those fuel costs. And then, you know, we're onboarding some new customers. Sometimes that can cause some OPEX spikes. But other than that, we're expecting a very consistent rate for the year and expect to get leverage. Great. Thank you.

And we'll go next now to Karen Holthaus with Citi. Hi.

Thanks for taking the question. One more on the convenience segment. Just looking at the sequential tick down in case growth, is there potentially some noise just when you're onboarding these big new customers and some kind of timing differences quarter to quarter? Or should we think of, you know, the underlying business really did slow by about 5% sequentially? And if it did, you know, maybe dig into your views on why that's happening and how much that's just tied to higher fuel prices.

Well, I think you touched on really the three things that I would answer with. One of those is, you know, we had talked about a couple of competitive losses. So that did have a little bit of an impact in the quarter, and we'll see a little bit of an impact over the first couple quarters of the year. So that was part of it. To your point, higher fuel prices certainly does have an impact, and we've seen a bit of a slowdown in just, you know, per-store case volume. So those two things, you know, certainly are impactful. But, you know, I feel really good, as I said, for the full year that they've got a really nice pipeline, and they're going to finish the year with a really strong case growth number and a strong bottom line number.

Great. Thank you.

Thank you. And, ladies and gentlemen, that's all the time we have for questions today. Mr. Marshall, I'd like to turn things back to you, sir, for any closing comments.

Thank you for joining our call today. If you have any follow-up questions, please reach out to us and invest in relations.

Thank you, ladies and gentlemen. And again, that will conclude PFG's fiscal year Q4 2026 earnings conference call. We'd like to thank you all so much for joining us and wish you all a great day.