Benchmark, and I'd like to introduce you all to our next presenting company. The Chefs' Warehouse is a leading specialty food distributor and marketer, marketing company that has been working with largely independent, fine dining, and polished casual restaurant chains and event venues for almost 40 years now. Growth algorithm is made up of above peer average organic growth and supplemented by acquisition, fueling annual revenue growth in the low double-digit range. As Chef targets growing to $5 billion in revenues over the next four years, up from just over $3 billion here in fiscal 2023. Chef is our top pick for 2024. Presenting from the Chefs' Warehouse this morning will be the company's founder, CEO, and President, Chris Pappas, and CFO, Jim Leddy, and I believe Treasurer, Lex will be also be presenting, correct?
Correct.
Okay, great. With that, I'll turn the presentation over to you all, and thanks for coming.
Thanks.
Great. Thanks, Todd. Let's see. Where's my video?
Just go forward. Yeah, right there.
I'm gonna try to play a little video for you to...
At The Chefs' Warehouse, we create opportunity. Our mission has always been to be the leading supplier to the best restaurants in North America.
We specialize in the best products from all over the world. That took us almost 40 years to find and bring together, and we import, store in one of our 29+ facilities in the United States and Canada.
People love to do business with people that understand their business, and that's who Chefs' Warehouse is.
We deliver to approximately 15,000 customers on a daily basis.
To do that, we continue to be innovative. We continue to recruit the best people possible.
Even though we are a pretty big company, we treat people like family and like entrepreneurs.
Really, what we look for are the people that have the passion of hospitality, that love the ingredients, love being around artisan producers.
What I would tell people that want to apply to work at The Chefs' Warehouse...
If you have the passion and desire to learn, and you want to continue learning-
Be prepared to work hard and be rewarded for it.
There's endless opportunity at Chefs' Warehouse. So a little snapshot. Food away from home is over a $350 billion industry. CW focuses on probably 10% of that top-line volume. You know, we're focused on the independent restaurants, high-end cruise ships, hotels, steakhouses, bake shops. Well, we like to think of it that our customers probably the top 10% of the world's earners. And we've been building this for over 35 years, so we really know who we're selling, and we know who we are. With over 44,000 customers now throughout the U.S., and now the Middle East, with over 1,000 people in our sales department.
It's a relationship business, and it's one of our greatest assets is our sales force. Over 3,000 suppliers from over 40 countries, that's part of our moat. You know, it's taken us a very long time to build this kind of global logistics company, and I think it's the most unique in food service, you know, where our products come from, and the relationships we have with our suppliers. A lot of our suppliers are small artisan companies from $10 million- $100 million, and we are really the their marketing, their... We take the place, actually, of a manufacturer in the markets that we represent them. And over 1,000 of our own trucks on the road today with just-in-time delivery.
So one of our unique competitive advantages is that, you know, though we are broad, we still have many of the attributes of a specialty distributor. And still, it's a very fragmented supply chain. There's a few of the big national broadliners, and then there's thousands of more specialized companies that, you know, deliver to our type of restaurants, and we're kind of a combination of both. So you know, we're getting bigger, and we're broader, like the broadliners, but we're still extremely flexible and can meet the customer that we want to serve best-in-class needs.
So if you look at who we serve, which, you know, kind of identifies who we are, you know, you're not gonna find a Chefs' Warehouse truck delivering to a prison network or, you know, bodegas or more of the, you know, lower fast casual. We supply the world's best chefs, and our core customers are more high-end casual. So it's not. You know, people sometimes think we're just super high-end fine dining. That kind of defines us because, you know, that's the root of our culture is, you know, the best products in the world. But our core customers are more high-end high-end casual. That's why, you know, you see our volume and we have so many customers, over 44,000 today.
We continue to grow, we continue to add more categories, but we keep that high-touch service that really keeps us at the forefront as the leader in supplying these types of restaurants. Very customer-centric. I spoke a little bit about our sales force before. It's very high touch. We put a lot of investment into hiring, and we put a lot of investment into training. So, we like to think that we do have the best-trained sales force in the industry because of the products that we sell. Chef is more of a marketing company that also distributes, so that's one of the things I think really differentiates us from some of the bigger Broadliners.
Because of the products that we sell, you really need to know what you're talking about when you go see a qualified chef, and you're talking about menu items, and seasonality, and all the things that makes them different from, you know, the thousands of restaurants around them. I spoke a little bit about the critical route to market. So we represent some of the, you know, the best high-end ingredient producers in the world, as well as we have exclusives, we have partnerships.
Over 50% of what goes on the truck today is in a controlled label, I call it a controlled label, either a Chef's Warehouse or one of our local companies around the U.S. is brand, or we have a relationship with the companies that we do represent, and that kind of helps us keep our margin. It's part of the moat that we've been building for over 35 years that we're really proud of, and our relationships really have never been stronger. Like everybody else, we're in the midst of the digital transformation, using an AI. We call it a more of a hybrid sell. I think that's really where I think our niche is going, leveraging the AI, leveraging digital. More and more of our customers are coming online.
I think it's inevitable that, you know, over 75% of our customers, as far as the placing the order, will be digital, and that also gives us a tremendous opportunity that we are starting to leverage in being able to speak to them, you know, even without a salesperson calling on them. We still do want the salespeople out in the street. You know, they're becoming more of a consultant and keeping more of a relationship manager. But, the ability now to really speak to our customers and tell them, you know, with over 40,000 products going through the system, it's hard for anybody to know all the products, and really with AI now and being able to communicate with them digitally, it's really, it's really an uptick for us.
One of our acquisition highlights over the last 14 months was entering a very unique market. It was a company that even named themselves after us. It was a very special opportunity to go into a market that's gonna double their population and was focused, just like Chef is... You know, we bought many companies in the U.S. and Canada, but we've never bought somebody that was just like us. So, it was a very unique opportunity, and we're very excited about Chef Middle East. We are a certified great place to work. You know, we are in the people business. Over 22% of our employees are female. It's a very inclusive, diversified company.
We're very, very proud of that, and I think it's one of the things that's driving our success and is attracting—we are attracting more and more, I think, of the best talent in the industry to CW. So the multiple levers to keep growing. We talked about our technology investments. We continue—we have slowed down, but we do continue to build facilities throughout, mainly in the U.S., which has given us more and more capacity. We are still looking at some M&A. We've slowed that down. We did a lot over the past 16 months, so we're being disciplined to see what really makes sense at this point, with so much capacity coming on throughout 2026 to allow us to continue to grow.
We're more focused than ever on who we are and which customers we want part of CW. We like to say not every, you know, we're not for everybody, but for the customers that do fit our proposition, we want to be the dominant player. We continue to grow our brands, we continue to grow our share of wallet, and we see many, many years of continued growth and success. And with that, I'll turn it over to Jim.
Thanks, Chris. So, Chris talked about the fragmented nature of the industry. So we took advantage of that. Obviously, the last four years has been a very kind of uneven, it's the word I like to use, volatile period. And we took advantage of that coming out of COVID in 2021 and 2022 to start recontinue the investment in infrastructure capacity expansion. I'm gonna talk about that in a second. And then also from an M&A perspective, over the course starting in 2022, we did 12 acquisitions, three of them fairly large for our history, and took advantage of a number of situations coming out of COVID that presented themselves.
So, you know, 2020 and 2021, we had the depths of COVID, subsequent volatility in both demand and pricing, closings, reopenings, closings, reopenings. We went into 2022 with Omicron, but came out of it with a surge in food away from home demand and food inflation, and that generated a very powerful operating leverage type of 2022, especially for us and our customer base. People that were inside just started going out and spending money at restaurants and traveling in hotels. And that created a weird comparison for 2023. 2023, you really had a more typical seasonal cadence to the business, with the exception for us of the summer. The summer had a couple of factors that came together. The smoke in the big cities, the extreme heat in a number of markets.
We did a very big acquisition that was a low EBITDA margin company that we added to the company, so it diluted us a little bit from an EBITDA margin perspective, and we experienced some growth-related expenses that were a little bit higher than we expected. But if you smooth all that out, and you kind of ignore the volatility of the last four years, we actually had a pretty good run. We doubled the size of the company in terms of revenue and gross profit. We based on the midpoint of our full year 2023 guidance, we would have grown adjusted EBITDA by 115% or $103 million, and that's a 21% CAGR over that four-year period, and we're probably gonna grow about 30% year-over-year, 2023 over 2022.
But as Todd mentioned, we're typically about a 10% or low double-digit type of growth company, and as Chris mentioned, we're going to slow that growth, reduce the level of M&A over the next couple of years, and we're at peak CapEx from an infrastructure perspective. And that aligns nicely with the capital allocation plan that Lex, our treasurer, is gonna talk to you about in a couple of slides. So the two buckets of investment that we've been making the last couple of years have been expanding our capacity, our distribution center capacity, to drive future organic growth, both regionally, as well as within market. So in 2019, we had 1.8 million sq ft of distribution center capacity.
Just the projects that have already come online in 2022 and 2023, we've tripled or quadrupled our capacity in Florida. Southern California, we added a lot of capacity. We did a fold-in acquisition there. We opened up a new distribution center in the Philadelphia, kind of southern New Jersey, Mid-Atlantic market. And that's optimizing our distribution footprint between the New York Metro and the Mid-Atlantic. That's gonna create capacity in New York as well as the Mid-Atlantic and give us growth for the Philadelphia and Pennsylvania region. And then high-growth markets like Arizona and Texas, where they're fast-growing, they're smaller, but they're a big part of our next 2 year-5-year strategy and goals.
And then we're gonna add another 30% or 500,000+ sq ft for projects that are currently being funded, a lot of them halfway through. Northern California, we'll be building a facility where we're consolidating a number of center-of-plate processing facilities into one facility with room for growth. Small, high-growth markets like Seattle and Nashville. In 2025, we'll build out our Portland, Oregon, facility, and we'll combine our Alexis Foods and CW Specialty business all together in one. And Chris mentioned the Middle East. We'll be doubling their capacity for a very high-growth, profitable market. So we're gonna add 60% in distribution center capacity over the next couple of years.
This has created a near-term operating spend or OpEx headwind, but we have multiple plans to leverage that and more than offset in the next couple of years. I mentioned consolidating facilities, consolidating routes, integrating acquisitions that we haven't fully gotten to yet or are in the early stages of transition and integration. We'll have lower transition costs, given the lower level of M&A over the next couple of years, and then just driving organic growth through that capacity, and then improving the lower margin acquisitions that we've added.
We've had a couple of times in the history of the company where we've made significant investments in capacity and M&A, and then the following years, we've improved the M&A, driven the volume through the capacity, and improved our Adjusted EBITDA margins over the course of that time frame. We're entering a similar phase for 2024 and 2025. The next bucket that Chris mentioned was we've grown through acquisition. So as I mentioned, we've done more acquisitions in the last few years than we have in the company's history. And if you look at that... our company right now, our guidance for the full year 2023 is about $3.4 billion in revenue.
About 85% of that is what we would call our core CW businesses, and that's roughly at 6.25% Adjusted EBITDA margin already, and that's with a full 100% corporate allocation. The other 15% are companies that were in the early stages of integrating, improving, Hardy's being, representing about half of that. They're a very big, $multi-hundred million revenue company in Texas that's a traditional produce company. They tend to be lower EBITDA margin. And so we'll work to integrate our CW specialty and our Allen Brothers business there in Texas over the next couple of years to make that a more profitable, combined, True Chefs' Warehouse in Texas. Texas is a high-growth market for us. So, as I mentioned, driving the organic growth and operating leverage through the capacity, improving the lower margin EBITDA companies.
The goal over the next 2 years-5 years is to get to $4 billion-$5 billion in revenue, 6%-7% in Adjusted EBITDA margin, and then have a lower percentage of the overall business be those companies that we're fixing and integrating over time. There's a good recent example of this. Before 2020, we serviced New England out of our New York distribution center in the Bronx, and it was very inefficient. We were running transfer trucks, depots, cross docks, and it was a relatively small part of our metro business. In 2020, we bought Sid Wainer, a very high-end specialty produce supplier in the New England area, and we bought Cambridge Meats. They've been rebranded as Allen Brothers Northeast. We combined them over a couple of years.
We moved them into the same footprint, and we moved our CW Specialty business, so we combined three different businesses into a true Chef’s Warehouse. Over that time, by consolidating all of the products onto one set of routes, one set of trucks, we took out a lot of OpEx, we drove the cross-sell, we integrated our sales teams, and we drove their EBITDA margin up 350 basis points, and they moved from that lower 15% into the 85%. Every market is different, but that gives you a general sense of the model, how we look at this over time. So the growth that we've seen over the... and where we are in that phase aligns nicely with the capital allocation plan and where we are in the phase of that growth.
I'm gonna give it to Lex Carter. He just joined The Chefs' Warehouse a couple months ago as our Director of Treasury. He's gonna walk you through the balance sheet and cash flow.
Thank you. So during our third quarter earnings call, we announced a change to our capital allocation model. Some of it's been highlighted by Chris and Jim today. So previously, we've been, again, in acquisition mode. The focus now will be more on debt reduction and returning some of that value to shareholders. So we're gonna do this really through three targets that we've identified with this plan. The first is a net debt leverage reduction from a 3.5x Adjusted EBITDA, which we're at today, down to a range of 2.5x-3x. So we'll accomplish that one through an expansion of Adjusted EBITDA, as Jim has mentioned.
But we'll also look to do some moderate debt reduction over the next two years, really as some free cash flow allows us to. Which will bring me into my second point or second target, and that is broad free cash flow generation. So over the last two years, you can see we've been in the red from a free cash flow perspective. And so how do we improve that? Right, so the first thing is a reduction of CapEx to about 1% of our annual revenue. The other thing is gonna be normalizing some of the working capital within some of our newer businesses as we continue to integrate those. And finally, slowing again some of that growth through acquisition that's required some of that additional investment.
The goal here is to generate between $50 million-$80 million a year in positive free cash flow. Which will segue nicely into our last target, which is a share repurchase program. We announced our board of directors approved us for $100 million of share repurchases over the next 2 years. So we'll target between $25 million and $100 million, really, again, as our free cash flow allows it, depending on the timing, and of course, market conditions, and the share price. And with that, we feel that we're positioning the company best, again, to have some optionality, over the next couple of years. And I'll pass it back to Jim.
Thanks, Lex. So good timing. We have a minute left. I'll just wrap it up with our full year 2022 or 2024 guidance that we, I think, announced publicly at when we started this presentation. So we're looking at, you know, a midpoint of about $3.7 billion in top line, which represents about a 9% growth rate over our full year estimate for the midpoint of our full year estimate for 2023. That's about 2% or 3% of RAP impact from M&A that we did throughout the year of 2023, and the rest would be anticipated organic growth.
A continuation of a strong gross profit margin profile and adjusted EBITDA between $205 million and $218 million, and the midpoint of that being about a 10% year-over-year growth rate from the current midpoint of our full year 2023 guidance. And then down below, for your modeling purposes, I've just provided some forecasts or estimates for D&A, forecasted interest expense, as well as forecasted tax rate, and then the impact of the accounting rule driven dilution from the convertible security that we have on the balance sheet. So, that wraps it up. Thanks for your time today.