Sysco provided an overview of its business and recent performance. Key points include:
- For fiscal year 2016, Sysco reported adjusted sales growth of 3.5% and adjusted earnings per share growth of 14.1%.
- Momentum continued into the fourth quarter with local case growth and gross margin expansion.
- The acquisition of Brakes enhances Sysco's product portfolio and geographic reach in Europe.
- For fiscal year 2017, Sysco aims to further grow gross profit through customer-focused solutions and insights while keeping supply chain costs flat.
- Executive compensation changes will result in a one-time $15 million expense shift from the second quarter to the first quarter of fiscal 2017.
MUTUAL FUNDS (ICICI Prudential Mutual Fund) BY JAMES RODRIGUESWilliamRodrigues148
Mutual funds are investment vehicles that pool money from multiple investors to purchase a diversified portfolio of stocks, bonds, or other securities. They are managed by professional portfolio managers or investment companies who make investment decisions on behalf of the fund's investors.
Sysco (NYSE: SYY) is the industry leader in foodservice distribution with expanding international reach
Annual sales of $50 billion
Wide variety of products, including Sysco Brand products
Deliver over 1.3 billion cases every year
Approximately 425,000 customers and 52,000 associates (67,000 including Brakes)
Foodservice industry is fragmented and highly competitive
Industry highlights:
Current deflationary environment
Mix of Local and Multi-Unit customers
Sysco is well positioned to win with a broad customer base, depth of product offerings, across diverse geographies
Talking points:
For the most recent quarter, traffic decreased compared to last year, but check increases drove increased sales
Mid scale and casual dining have declined year over year while QSR is essentially flat
Foodservice delivery through delivery apps has shown 45% growth and represents an estimated $5.2 billion in orders for 2016
Despite relative industry softness, Sysco is positioned to win in the market
Talking Points
Sysco serves many different customer types
2/3 of business is restaurants
1/3 is any other form of food away from home
Healthcare – strong for Sysco
Education – public/private/primary/secondary
Others such as travel and leisure, business and industry, etc.
Our breadth and depth gives us many advantages
Before I turn it over to Joel…a few closing thoughts…
We are confident in our ability to achieve our plan
We are the industry leader, not only in size and scale, but in product and service offerings. We offer our customers industry-leading service and support. All of which benefits our performance – you can see that when comparing margins across the industry.
We had a very good year in fiscal 2016 – reflected by solid operating performance and excellent progress on several key multi-year initiatives that provided a strong foundation for our success. During the year:
We achieved $50 billion in sales with total Broadline case growth of 3% and local case growth of 2.7%
Grew gross profit 3.6% to $9 billion; improved gross margin nearly 40 bps
Increased operating income 10% to $2 billion; and
Grew EPS 12%
Going into the new fiscal year, we have good momentum in our business. While we are somewhat cautious on the current market environment, the new year brings an expanded global presence, enhanced technology and continued focus on the success of our customers. We intend to deliver profitable growth for our business through a disciplined approach to both case growth and cost controls.
I am confident that we are putting the right programs and processes in place that will enable our future success.
Thank you for your time this morning, and now I’ll turn it over to Joel for a financial update and then we’ll both be happy to take your questions.