Slide 1: Sysco 2Q FY22 Earnings Results
Sysco 2Q FY22 Earnings Results February 8, 2022
Slide 2: Forward Looking Statements
Forward Looking Statements Statements made in this presentation or in our earnings call for the second quarter of fiscal 2022 that look forward in time or that express management’s beliefs, expectations or hopes are forward-looking statements within the meaning of the Private Securities Litigation R
Slide 3: Kevin Hourican, President & CEO
KEVIN HOURICAN President & CEO
Slide 4: Sysco's 2QFY22 Results Show Strong Gains
Sysco’s 2QFY22 Results Show Strong Gains Fiscal 2Q 2022 Highlights Sysco delivered another quarter of strong sales growth compared to fiscal 2019 levels, which continued to result in significant share gains. Inflation was effectively managed; however, staffing challenges, labor expense and supply-ch
Slide 5: Sysco Continues to Outperform Total Foodservice Industry Resulting in Share Gains
Sysco Continues to Outperform Total Foodservice Industry Resulting in Share Gains Since the start of the pandemic, Sysco has performed better than the total foodservice market vs 2019 USFS Ops Revenue Indexed to 2019 vs Technomic Market Estimated Indexed to 2019 100 index Q1'21 Q2'21 Q3'21 Q4'21 Q1'
Slide 6: Growing Number of Exclusive Independent Customers
Sysco is Growing the Number of Exclusive Independent Customers; Number of Customers Not Yet Using Sysco is Steadily Declining 57.0% 32.0% Sysco Only 56.5% 31.5% 56.0% 31.0% 55.5% 30.5% 55.0% 30.0% 54.5% 29.5% No Sysco 54.0% 29.0% 53.5% 28.5% 53.0% 28.0% Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Ja
Slide 7: Sysco is Well Positioned for Long-Term Growth Acceleration
Sysco is Well Positioned for Long-Term Growth Acceleration • Sales growth of 10.5% above fiscal 2019 levels with continued meaningful share gains • Gross profit per case increased across all operating segments in the quarter • Actively managed cost inflation, staffing and supply chain challenges • E
Slide 8: Aaron Alt, EVP & CFO
AARON ALT EVP & CFO
Slide 9: 2Q 2022 Consolidated Financial Results
2Q 2022 Consolidated Financial Results Net Sales Adj. EBITDA1 Adj. EPS1 Overview (billions) (millions) • Sales growth of 10.5% above fiscal 2019 levels with continued $752 meaningful share gains $16.3 $14.8 $671 • Product cost inflation effectively managed $0.75 $11.6 • Gross profit per case increas
Slide 10: Snap-back and Transformation Investments Impacting Operating Costs
Snap-back and Transformation Investments Impacting Operating Costs Snap-back and Transformation Costs by Quarter $120 Millions Overview $100 $ 44M • Continued transformation investments for our Recipe For Growth ($44M in 2Q 2022) $80 • Snap-back investments ($73M in 2Q 2022) $ 24M driven by recruiti
Slide 11: 2Q 2022 U.S. Foodservice Results
2Q 2022 U.S. Foodservice Results Net Sales Adj. Operating Overview (billions) Income1 (millions) • Sales growth of 14.0% above fiscal 2019 levels $737 • Above-industry growth resulting in $685 $11.5 meaningful share gains $10.1 • Within U.S. Broadline operations, local $472 case volume increased 17.
Slide 12: 2Q 2022 SYGMA Results
2Q 2022 SYGMA Results SYGMA Net Sales Adj. Operating Overview (billions) Income1 (millions) • Sales growth of 15.3% above fiscal 2019 levels $11 $1.8 • Operating loss vs. prior year impacted by record profits in the prior year, a $1.5 $1.5 previously disclosed large customer rationalization and elev
Slide 13: 2Q 2022 International Results
2Q 2022 International Results Net Sales Adj. Operating Overview (billions) Income1 (millions) • Sales 2.9% below fiscal 2019 levels • Foreign exchange rates had a positive $83 impact of 1.7% on sales $2.9 $2.8 • Omicron-driven lockdowns in International markets negatively $40 impacted December sales
Slide 14: 1H 2022 Cash Flow
1H 2022 Cash Flow Cash from Operations Free Cash Flow1 Overview (millions) (millions) • Cash from operations was $377 million for the first half of the year driven by investments in working capital as the $918 $937 $788 company prioritized managing product availability $701 • Net capital expenditure
Slide 15: Capital Structure and Allocation
Capital Structure and Allocation Investment Priority Progress • Continued capital investments over the next three fiscal years in our technology, fleet and buildings • Announced acquisition of The Coastal Companies, bolstering our fresh produce offering in the Mid- 1 Invest for Growth Atlantic • Str
Slide 16: Sysco Consistently Increases Returns to Shareholders
Sysco Consistently Increases Returns to Shareholders Cumulative Cash Returned to Shareholders $ 12.9B $12.0B $ 11.1B $ 9.4B $ 7.6B $ 5.9B $ 3.3B $0.7B FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022 (Q2 YTD) Dividends Shares Repurchased Over $12 Billion of Cash Returned to Shareholders Since
Slide 17: Kevin Hourican, President & CEO
KEVIN HOURICAN President & CEO
Slide 18: Current Share Gains Lead to Long-term Confidence
Current Share Gains Lead to Long-term Confidence Strong top-line performance Exceeding 1.2x market share growth Expecting volume recovery post Omicron Operating expenses projected to improve in 2H 2022 Confident in our Long-Term Trajectory Reaffirming our Long-Term Guidance 18
Slide 19: Sysco: At the heart of food and service
S/sco At the heart of food and service
Slide 20: Non-GAAP Reconciliations
NON-GAAP RECONCILIATIONS
Slide 21: Impact of Certain Items
Impact of Certain Items Our discussion of our results includes certain non-GAAP financial measures, including EBITDA and adjusted EBITDA, that we believe provide important perspective with respect to underlying business trends. Other than free cash flow, any non-GAAP financial measures will be denot
Slide 22: Non-GAAP Reconciliation: Impact of Certain Items, 2Q22 vs. 2Q21
Sysco Corporation and its Consolidated Subsidiaries Non-GAAP Reconciliation (Unaudited) Impact of Certain Items, 2Q22 vs. 2Q21 (Dollars in Thousands, Except for Share and Per Share Data) 13-Week 13-Week Period Ended Period Ended Change Jan. 1, 2022 Dec. 26, 2020 in Dollars % Change Sales (GAAP) $ 16
Slide 23: Non-GAAP Reconciliation: Impact of Certain Items, 2Q22 vs. 2Q21 (continued)
Sysco Corporation and its Consolidated Subsidiaries Non-GAAP Reconciliation (Unaudited) Impact of Certain Items, 2Q22 vs. 2Q21 (Dollars in Thousands, Except for Share and Per Share Data) continued Interest expense (GAAP) $ 242,899 $ 146,498 $ 96,401 65.8% Impact of loss on extinguishment of debt (11
Slide 24: Non-GAAP Reconciliation: Impact of Certain Items, 2Q22 vs. 2Q19
Sysco Corporation and its Consolidated Subsidiaries Non-GAAP Reconciliation (Unaudited) Impact of Certain Items, 2Q22 vs. 2Q19 (Dollars in Thousands, Except for Share and Per Share Data) 13-Week 13-Week Period Ended Period Ended Change Jan. 1, 2022 Dec. 29, 2018 in Dollars % Change Sales (GAAP) $ 16
Slide 25: Non-GAAP Reconciliation: Impact of Certain Items, 2Q22 vs. 2Q19 (continued)
Sysco Corporation and its Consolidated Subsidiaries Non-GAAP Reconciliation (Unaudited) Impact of Certain Items, 2Q22 vs. 2Q19 (Dollars in Thousands, Except for Share and Per Share Data) continued Diluted earnings per share (GAAP) $ 0.33 $ 0.51 $ (0.18) -35.3% Impact of restructuring and transformat
Slide 26: Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA)
Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) EBITDA represents net earnings plus (i) interest expense, (ii) income tax expense and benefit, (iii) depreciation and (iv) amortization. The net earnings component of our EBITDA calculation is impacted by Certain Items that we d
Slide 27: Impact of Certain Items on EBITDA (2Q22 vs. 2Q21)
Sysco Corporation and its Consolidated Subsidiaries Non-GAAP Reconciliation (Unaudited) Impact of Certain Items on Earnings Before Interest, Taxes, Depreciation and Amortization (2Q22 vs. 2Q21) (In Thousands) 13-Week 13-Week Period Ended Period Ended Change Jan. 1, 2022 Dec. 26, 2020 in Dollars %/bp
Slide 28: Impact of Certain Items on EBITDA (2Q22 vs. 2Q19)
Sysco Corporation and its Consolidated Subsidiaries Non-GAAP Reconciliation (Unaudited) Impact of Certain Items on Earnings Before Interest, Taxes, Depreciation and Amortization (2Q22 vs. 2Q19) (In Thousands) 13-Week 13-Week Period Ended Period Ended Change Jan. 1, 2022 Dec. 29, 2018 in Dollars %/bp
Slide 29: Segment Results Non-GAAP Reconciliation, 2Q22 vs. 2Q21
Sysco Corporation and its Consolidated Subsidiaries Segment Results Non-GAAP Reconciliation (Unaudited) Impact of Certain Items on Applicable Segments, 2Q22 vs. 2Q21 (Dollars in Thousands) 13-Week Period Ended Jan. 1, 2022 13-Week Period Ended Dec. 26, 2020 Change in Dollars %/bps Change U.S. FOODSE
Slide 30: Segment Results Non-GAAP Reconciliation, 2Q22 vs. 2Q21 (continued)
Sysco Corporation and its Consolidated Subsidiaries Segment Results Non-GAAP Reconciliation (Unaudited) Impact of Certain Items on Applicable Segments, 2Q22 vs. 2Q21 (Dollars in Thousands) continued OTHER Sales $ 244,453 $ 146,649 $ 97,804 66.7% Gross Profit 54,809 35,767 19,042 53.2% Gross Margin 2
Slide 31: Segment Results Non-GAAP Reconciliation, 2Q22 vs. 2Q19
Sysco Corporation and its Consolidated Subsidiaries Segment Results Non-GAAP Reconciliation (Unaudited) Impact of Certain Items on Applicable Segments, 2Q22 vs. 2Q19 (Dollars in Thousands) 13-Week 13-Week Period Ended Period Ended Change Jan. 1, 2022 Dec. 29, 2018 in Dollars %/bps Change U.S. FOODSE
Slide 32: Segment Results Non-GAAP Reconciliation, 2Q22 vs. 2Q19 (continued)
Sysco Corporation and its Consolidated Subsidiaries Segment Results Non-GAAP Reconciliation (Unaudited) Impact of Certain Items on Applicable Segments, 2Q22 vs. 2Q19 (Dollars in Thousands) continued OTHER Sales $ 244,453 $ 251,397 $ (6,944) -2.8% Gross Profit 54,809 63,501 (8,692) -13.7% Gross Margi
Slide 33: Free Cash Flow, YTD22 vs. YTD21 and YTD22 vs. YTD19
Sysco Corporation and its Consolidated Subsidiaries Non-GAAP Reconciliation (Unaudited) Free Cash Flow, YTD22 vs. YTD21 and YTD22 vs.YTD19 (In Thousands) Free cash flow represents net cash provided from operating activities less purchases of plant and equipment and includes proceeds from sales of pl