Reuters reported that Chefs' Warehouse this month cut its earnings forecast by about 20% just weeks after it obtained millions of dollars in financing, drawing the ire of some lenders.
The Reuters article noted the distributor of specialty food products said it had a net loss for the second quarter of $8.5 million compared to net income of $3.4 million for the same time period in 2015, according to an August 2 earnings release. Chefs' also this month updated its 2016 adjusted EBITDA guidance to between $53 million and $58.5million. In May it forecast $68 million to $73 million, Reuters said in the article.
Investors in Chefs' $305 million term loan, which was arranged by a group of banks led by Jefferies, were frustrated after the company changed its earnings forecast just weeks after they agreed to provide financing for the company according to the Reuters article. Potentially complicating the investment are acquisition limits placed on the borrower by its credit agreement that require a certain ratio of debt compared to earnings.
View the entire Reuters article LPC: Chefs' Warehouse Earnings Guidance Misses After Financing.