Sysco Corporation · NYSE:SYY
Sysco — FY2012 Earnings Presentation
24 slides from Sysco's earnings presentation, Aug 13, 2012
Slide 1: Sysco 4Q & FY12 Earnings Results
Sysco 4Q & FY12 Earnings Results August 13, 2012
Slide 2: Forward-Looking Statements
Forward-Looking Statements Certain statements made herein 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 Reform Act of 1995. Such forward-looking statements reflect the views
Slide 3: Bill DeLaney, President & CEO
Bill DeLaney President & CEO 3
Slide 4: Fiscal 2012 Highlights
Fiscal 2012 Highlights Adjusted Results1 Reported YOY % YOY % $ Millions, except share data FY12 FY12 Change Change Sales $42,381 7.8% $42,381 7.8% Gross Profit $7,677 3.8% $7,677 3.8% Operating Expenses $5,568 4.1% $5,786 5.9% Operating Income $2,108 3.0% $1,891 (2.1%) Net Earnings $1,257 4.7% $1,1
Slide 5: Key Metrics
Key Metrics FY12 YOY Change Case Volume +3.0% (1) Gross Profit +3.8% Cost per Case +4 cents (2) (1) Broadline + SYGMA; including acquisitions 5 (2) Broadline, excluding meat companies
Slide 6: Free Cash Flow Increased 36% in FY12
Free Cash Flow Increased 36% in FY12 $ Millions FY12 FY11 Cash Flow from Operations $1,404 $1,092 Capital Expenditures $785 $636 Free Cash Flow $620 $455 (1) (1) Free Cash Flow table may not foot due to rounding 6
Slide 7: Business Transformation Update
Business Transformation Update Entered deployment phase in late July with East Texas conversion Adopted a market-based deployment approach Next 5 planned conversions in Texas and Louisiana SBS is functioning well Making progress in initiatives to reduce cost structure and lower product cos
Slide 8: Key Takeaways
Key Takeaways Returning value to our shareholders remains a priority Speed and execution in fiscal 2013 will be key as we continue to develop and implement key initiatives to support our Business Transformation Investments we are making in our business will improve our financial results over t
Slide 9: Chris Kreidler, EVP & CFO
Chris Kreidler EVP & CFO Good things
Slide 10: Case Growth and Inflation Drive Sales Growth
Case Growth and Inflation Drive Sales Growth (1) Case Growth Inflation 4.0% 8.0% 7.3% 3.6% 3.4% 3.5% 7.0% 6.3% 2.9% 3.0% 6.0% 5.5% 2.5% 5.0% 2.0% 1.8% 4.0% 3.3% 1.5% 3.0% 1.0% 2.0% 0.5% 1.0% 0.0% 0.0% 1Q12 2Q12 3Q12 4Q12 1Q12 2Q12 3Q12 4Q12 (1) – Includes Broadline and SYGMA, including acquisitions.
Slide 11: 4Q12 & FY12 Gross Profit Trend
4Q12 & FY12 Gross Profit Trend ($ in millions) +3.8% +2.9% YOY YOY $7,677 $7,395 $2,012 $1,954 4Q11 4Q12 FY11 FY12 4th Quarter Full Year 11
Slide 12: 4Q12 Operating Expenses
4Q12 Operating Expenses (YOY change; $ in millions) 4Q12 6 16 20 23 Reported operating 38 expense +7.4% Adjusted1 operating $1,496 expense +3.3% $1,394 4Q11 Business Special Payroll Fuel Other 4Q12 Transf. Items 1 See Non-GAAP reconciliations at the end of this presentation. 12
Slide 13: 4Q12 Highlights
4Q12 Highlights Adjusted1 Reported YOY % YOY % $ Millions, except per share data 4Q12 4Q12 Change Change Sales $11,045 5.9% $11,045 5.9% Gross Profit $2,012 2.9% $2,012 2.9% Operating Expenses $1,404 3.3% $1,496 7.4% Operating Income $608 2.2% $515 (8.1%) Net Earnings $367 3.7% $309 (8.0%) Diluted E
Slide 14: Fiscal 2012 Highlights
Fiscal 2012 Highlights Adjusted Results1 Reported $ Millions, except per share data YTD YOY % YTD YOY % FY12 Change FY12 Change Sales $42,381 7.8% $42,381 7.8% Gross Profit $7,677 3.8% $7,677 3.8% Operating Expenses $5,568 4.1% $5,786 5.9% Operating Income $2,108 3.0% $1,891 (2.1%) EPS $2.13 4.4% $1
Slide 15: Business Transformation Project Costs
Business Transformation Project Costs (in millions) 4Q12 4Q11 FY12 FY11 Operating expense $70 $33 $193 $103 Capital investment $23 $49 $146 $196 15
Slide 16: Free Cash Flow Increased 36% in FY12
Free Cash Flow Increased 36% in FY12 $ Millions FY12 FY11 Cash Flow from Operations $1,404 $1,092 Capital Expenditures $785 $636 Free Cash Flow $620 $455 (1) Dividends Paid $623 $598 Paid final $212 million in IRS settlement payments in FY12; positive impact on FY13 cash flow (1) Free Cash Flow tabl
Slide 17: Capital Expenditures
Capital Expenditures ($ millions) New facilities under construction in FY12 (Long Island, Boston, Central Texas) Expansions underway in several locations $785 $785 $636 $636 FY11 FY12 FY11 FY12 1Q 2Q 3Q 4Q Technology Fleet Facilities Other 17
Slide 18: FY13 Guidance
FY13 Guidance Guidance FY13 Fuel expense Flat Business Transformation expense net $300 - 350 million of direct SBS benefits Business Transformation capital $5 - 20 million (included in capital below) ~25% of total expected annualized Business Transformation benefits benefits of $550-650 million Capi
Slide 19: Impact of Retirement Plan Changes
Impact of Retirement Plan Changes FY13 vs. $ Millions FY12 Without retirement plan changes: Increase in pension expense ~$100 With retirement plan changes: Decrease in pension expense - FY13 ~($25) Increase in 401(k) expense - 2H13 $45-55 Net increase to retirement plan expense $20-30 We estimate th
Slide 20: thin gs
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Slide 21: Non-GAAP Reconciliations
Non-GAAP Reconciliations 21
Slide 22: 4Q12 & FY12 Non-GAAP Reconciliations
4Q12 & FY12 Non-GAAP Reconciliations Sysco’s results of operations are impacted by certain items which include charges from the withdrawal from multiemployer pension plans, restructuring charges and recognized tax benefits. Management believes that adjusting its operating expenses, operating income,
Slide 23: 4Q12 Non-GAAP Reconciliations
4Q12 Non-GAAP Reconciliations 13-Week 13-Week 13-Week 13-Week Period Ended Period Ended Period Change Period In Thousands, Except for Share and Per Share Data June 30, 2012 July 2, 2011 in Dollars % Change Operating expenses (GAAP) $ 1,496,247 $ 1,393,642 $ 102,605 7.4 % Impact of MEPP charge (16,68
Slide 24: FY12 Non-GAAP Reconciliations
FY12 Non-GAAP Reconciliations 52-Week 52-Week 52-Week 52-Week Period Ended Period Ended Period Change Period In Thousands, Except for Share and Per Share Data June 30, 2012 July 2, 2011 in Dollars % Change Operating expenses (GAAP) $ 5,785,945 $ 5,463,210 $ 322,735 5.9 % Impact of MEPP charge (21,89