Sysco Corporation · NYSE:SYY
Sysco — CAGNY 2025
38 slides from Sysco's conference presentation, Feb 18, 2025
Slide 1: CAGNY 2025
CAGNY 2025 February 18, 2025
Slide 2: Forward-Looking Statements
Forward-Looking Statements Statements made in this presentation that look forward in time or that express management’s beliefs, expectations or hopes are forward-looking statements under the Private Securities Litigation Reform Act of 1995. Such forward-looking statements reflect the views of manage
Slide 3: Kevin Hourican, Chair of the Board and CEO
Kevin Hourican CHAIR OF THE BOARD AND CHIEF EXECUTIVE OFFICER
Slide 4: Food Sales & Marketing, Food Supply Chain
Food Sales Food & Marketing Supply Chain
Slide 5: Slide 5
Slide 6: Sysco Business at a Glance
Sysco Business at a Glance Only Global Player Leading Market Share + Best-in-Class Food Export Business 1 $82+ billion 76,000 340 in Expected FY25 Distribution Global Colleagues Sales Facilities #1 Market ~7,500 ~730K Share1 Sales Professionals Customer Locations Sales by Customer Type # 1 #1 market
Slide 7: Growing Sales in 52 out of 55 Years
Growing Sales in POSITIONED TO WIN 52 out of 55 Years • #1 positions across National, Local, and Specialty Robust cross-selling opportunities with Broadline scale & specialty expansion to fuel future sales growth • International segment continues to drive strong growth • Strong M&A track record
Slide 8: Sysco is #1 in an Attractive, Growing Industry
Sysco is #1 in an Attractive, Growing Industry Total Addressable Market Since 2000 $353 B $360 B $371 B 17% $300 B $268 B $224 B $231 B $197 B $161 B $371B 2000 2005 2010 2015 2020 2021 2022 2023 2024 Source: Technomic U.S. Foodservice Industry Wallchart for Calendar Year as of January 2025
Slide 9: Sysco Has A Compelling Global Foodservice Model
United States: #1 Position Sysco Has A Compelling Ireland: #1 Position 15.4% 17.4% $371B Global Foodservice Model 14.9% 19.7% $4B TAM TAM 2019 2024 2019 2024 Canada: #1 Position Great Britain: #1 Position 26.0% 13.7% 24.0% 10.1% $23B $27B TAM TAM 2019 2024 2019 2024 Sweden: #2 Position Bahamas: #1 P
Slide 10: Yes, Chef!
Yes, Chef! food and service
Slide 11: Sysco's Financial Growth Algorithm
Sysco’s Financial Growth Algorithm Total Sales Growth Adj. EPS Growth1,3 Shareholder Return2 4% – 6% 6% – 8% 9% – 11% 6 – 8% Adj. Operating Income Growth3 Algorithm for growth is based on 3-Year plan. 1 Includes impact of global minimum tax headwinds to EPS growth in FY25. 2 Assumes no change in P/E
Slide 12: Enhancing Today, While Shaping Tomorrow Through a Focus on Core Strengths
Enhancing Today, While Shaping Tomorrow Through a Focus on Core Strengths CONTINUE TO ADVANCE OUR RECIPE FOR GROWTH KEY UPDATES Local Growth Vectors Progress Report
Slide 13: Local: Positioned for Sequential Improvement in 2H25
Local: Positioned for Sequential Improvement in 2H25 Salesforce Compensation Capacity Total Selling Investment & Performance Expansion Team Initiatives Management Selling Adding +400 to +500 Optimized Program to New and Expanded Leveraging the Scale of Sales Professionals Drive Profitable Growth Fac
Slide 14: Vectors of Growth
Vectors of Growth Sysco Brand International Specialty US Broadline 4% 20% 31% CAGR CAGR $15 CAGR $18 $9 Sysco Specialty Sales in bil. Sysco International Sales in bil. Sysco Brand Sales in bil. $14 $8 $4 FY19 FY24 FY21 FY24 FY21 FY24 Selling Initiatives: Long-Term Accretive M&A Pricing Agility
Slide 15: Meaningful Progress in the Last 12 Months
Meaningful Progress in the Last 12 Months Compelling Growth in International, National, Leveraging AI to Improve and SYGMA Businesses 1 6 Service and Cost Efficiencies Gross Margin and 7 Improved YOY NPS Operating Income Expansion Salesforce Retention, EPS Growth 3 8 Recruitment and Performance Mean
Slide 16: Kenny Cheung, EVP and Chief Financial Officer
Kenny Cheung EXECUTIVE VICE PRESIDENT AND CHIEF FINANCIAL OFFICER
Slide 17: Confidence in FY25 Following Record FY24
Confidence in FY25 Following Record FY24 Attractive Return Net Sales Adj. EPS 1 Profile in Billions 13% 34% CAGR $82 + CAGR $4.57- $4.61 #1 Market Share $76 $79 $4.01 $4.31 + Industry Leading: $69 $3.25 $51 • Sales • Gross Margins $1.44 • EBITDA Margins • Free Cash Flow • ROIC • Investment Grade Bal
Slide 18: Superior Performance vs. Core Peers
Superior Performance vs. Core Peers Gross Margin Operating Margin1 Free Cash Flow1 $2,500 in Mil. 20% 18.5% 5% $2,236 4.4% 4% $2,000 15% 14.3% 10% 1.3x 3% 2.7% 1.6x $1,500 2.9x 2% $1,000 $759 5% 1% $500 0% 0% $- Core Peers Sysco Core Peers Sysco Core Peers Sysco FY24 FY24 FY24 1 See Non-GAAP reconci
Slide 19: Sysco's Financial Growth Algorithm
Sysco’s Financial Growth Algorithm Total Sales Growth Adj. EPS Growth1,3 Shareholder Return2 4% – 6% 6% – 8% 9% – 11% Volume: 1.5%-3.5% Supply Chain and 40%-50% Payout Ratio Inflation: 2.0% Corporate Efficiencies ~3% Dividend Yield M&A: 0.5% $1B of Annual Share Repurchase Algorithm for growth is bas
Slide 20: ROIC Growth Mindset
ROIC Growth Mindset Leverage Industry Leading ROIC1 Profile Size & Scale + 20.0% Structural Cost Outs 16.0% 15.9% 11.9% 12.0% Long-Term Accretive ROIC 8.0% 7.0% M&A FOCUS 4.0% Strategic Reallocation 0.0% Core Peers Median S&P 500 Sysco of Capital Consumer Staples FY24 1 Represents adjusted ROIC for
Slide 21: Proof Point: Sysco International
Proof Point: Sysco International Net Sales Adj. Operating Income1 in billions in millions 11% 47% CAGR CAGR $492 $15 International $14 $398 a Growth $12 Vector with Positive $229 Momentum FY22 FY23 FY24 FY22 FY23 FY24 1 See Non-GAAP reconciliations at the end of the presentation.
Slide 22: Underpinned by Balanced Capital Allocation
Underpinned by Balanced Capital Allocation Invest for Maintain a Strong Return Cash to Growth Balance Sheet Shareholders Capex Investments Commitment to Balanced Shareholder ~1% of Annual Sales IG with Leverage Return with Growing Target of 2.5 – 2.75x1 Dividend & Share Repurchase 1 In arriving at A
Slide 23: Strong Cash Generation Drives Shareholder Returns
Strong Cash Generation Drives Shareholder Returns $19.5 Over $19.5 billion $17.2 of cumulative cash expected to $15.0 $13.5 Dividends Share Repurchase $11.1 $12.0 be returned Dividends to shareholders $9.4 Share Repurchase $7.6 $5.9 through FY 2025 $3.3 $0.7 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 F
Slide 24: Sysco is a Dividend Aristocrat, Growing Dividends for 55 Years
Sysco is a Dividend Aristocrat, Growing Dividends for 55 Years 15% CAGR
Slide 25: Sysco Well-Positioned for the Long-Term
Sysco Well-Positioned for the Long-Term Global DC Industry Investment Grade Consistent Growing Network Leading Credit Rating History of Share Dividend Margins Repurchases Average Core Peers Core peer group represents average of USFD and PFGC.
Slide 26: Kevin Hourican, Chair of the Board and CEO
Kevin Hourican CHAIR OF THE BOARD AND CHIEF EXECUTIVE OFFICER
Slide 27: Compelling Investment Opportunity
Compelling Investment Opportunity 1 Market leader in foodservice with key strategic advantages and significant scale, benefitting from food away from home trends 2 Resilient business model, balanced across end geographies, channels, and product mixes 3 Multiple vectors of growth in core volumes and
Slide 28: Sysco: At the heart of food and service
S/sco At the heart of food and service S/scO At the heart of food and service
Slide 29: Non-GAAP Reconciliations
NON-GAAP RECONCILIATIONS /: the heart of food and service
Slide 30: Impact of Certain Items
Impact of Certain Items The 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 EBITDA and free cash flow, any non-GAAP financial measures wi
Slide 31: Non-GAAP Reconciliation: Impact of Certain Items
Sysco Corporation and its Consolidated Subsidiaries Non-GAAP Reconciliation (Unaudited) Impact of Certain Items (Dollars in Millions, Except for Share and Per Share Data) 52-Week 52-Week 52-Week 53-Week Period Ended Period Ended Period Ended Period Ended Jun. 29, 2024 Jul. 1, 2023 Jul. 2, 2022 Jul.
Slide 32: Non-GAAP Reconciliation: Impact of Certain Items (continued)
Sysco Corporation and its Consolidated Subsidiaries Non-GAAP Reconciliation (Unaudited) Impact of Certain Items (Dollars in Millions, Except for Share and Per Share Data) continued Diluted earnings per share (GAAP) $ 3.89 $ 3.47 $ 2.64 $ 1.02 Impact of inventory valuation adjustment - (0.01) (1) 0.1
Slide 33: Non-GAAP Reconciliation: International Foodservice Operations
Sysco Corporation and its Consolidated Subsidiaries Non-GAAP Reconciliation (Unaudited) Impact of Certain Items (Dollars in Millions) 52-Week 52-Week 52-Week FY22 to FY24 Period Ended Period Ended Period Ended Compound Annual Jun. 29, 2024 Jul. 1, 2023 Jul. 2, 2022 Growth Rate INTERNATIONAL FOODSERV
Slide 34: Non-GAAP Reconciliation: Free Cash Flow, YTD24
Sysco Corporation and its Consolidated Subsidiaries Non-GAAP Reconciliation (Unaudited) Free Cash Flow, YTD24 (In Millions) Free cash flow represents net cash provided from operating activities less purchases of plant and equipment and includes proceeds from sales of plant and equipment. Sysco consi
Slide 35: Non-GAAP Reconciliation: Adjusted Return on Invested Capital
Sysco Corporation and its Consolidated Subsidiaries Non-GAAP Reconciliation (Unaudited) Adjusted Return on Invested Capital (In Millions) Although adjusted return on invested capital (ROIC) is considered a non-GAAP financial measure, Sysco management considers adjusted ROIC to be a measure that prov
Slide 36: Projected Adjusted EPS Guidance
Projected Adjusted EPS Guidance Adjusted earnings per share is a non-GAAP financial measure; however, we cannot predict with certainty certain items that would be included in the most directly comparable GAAP measure for the relevant future periods. Due to these uncertainties, we cannot provide a qu
Slide 37: Projected Adjusted EBITDA Guidance
Projected Adjusted EBITDA Guidance Adjusted EBITDA is a non-GAAP financial measure; however, we cannot predict with certainty the particular certain items that would be excluded from the calculation of this measure for future periods. Due to these uncertainties, we cannot provide a quantitative reco
Slide 38: Net Debt to Adjusted EBITDA Leverage Ratio Targets
Net Debt to Adjusted EBITDA Leverage Ratio Targets We expect to achieve our net debt to adjusted EBITDA leverage ratio forecast in fiscal 2025. We cannot predict with certainty when we will achieve these results or whether the calculation of our EBITDA will be on an adjusted basis in future periods