Sysco Corporation (SYY) Bundle
A Brief History of Sysco Corporation
Overview
Sysco Corporation (SYY), founded in 1969, is a leading global distributor of food products and non-food items, primarily serving the foodservice industry. As of 2024, Sysco operates in multiple regions, including the United States, Canada, and Europe, with a significant presence in the foodservice distribution sector.
Financial Performance in 2024
For the first quarter of fiscal 2025, which ended on September 28, 2024, Sysco reported total sales of $20.48 billion, a 4.4% increase compared to $19.62 billion in the same period of the previous year. The gross profit for the same quarter was $3.75 billion, representing a gross margin of 18.32%.
| Financial Metrics | Q1 FY 2025 | Q1 FY 2024 | Change |
|---|---|---|---|
| Total Sales | $20.48 billion | $19.62 billion | +4.4% |
| Gross Profit | $3.75 billion | $3.65 billion | +2.9% |
| Operating Income | $808 million | $804 million | +0.5% |
| Net Earnings | $490 million | $503 million | -2.6% |
| Basic EPS | $1.00 | $1.00 | 0% |
| Diluted EPS | $0.99 | $0.99 | 0% |
Cash Flow and Capital Expenditures
In the first 13 weeks of fiscal 2025, Sysco generated $53 million in cash flows from operations, a decrease from $87 million in the same period in the previous year. The company’s capital expenditures totaled $122 million, primarily for investments in technology and fleet improvements.
Debt and Financing Activities
As of September 28, 2024, Sysco's total carrying value of debt was $12.4 billion, up from $12.0 billion at the end of the previous quarter. The company has a commercial paper program with $325 million in issuances outstanding. Sysco also repurchased 1,439,652 shares for $108 million during the first quarter of fiscal 2025.
| Debt and Financing Metrics | Amount |
|---|---|
| Total Debt | $12.4 billion |
| Commercial Paper Issuance | $325 million |
| Share Repurchases | $108 million |
| Dividends Paid | $251 million |
Market Position and Strategic Initiatives
Sysco maintains a strong market position as one of the largest foodservice distributors in North America. The company continues to focus on its “Recipe for Growth” strategy, which aims to enhance operational efficiencies and expand its customer base. Sysco's investments in technology and supply chain improvements are projected to bolster its competitive edge in the foodservice industry.
Recent Challenges and Opportunities
In the first quarter of fiscal 2025, Sysco faced challenges with an unfavorable comparison on working capital, specifically in accounts receivable and inventory. Despite these challenges, the company remains optimistic about future growth driven by strategic acquisitions and market expansion efforts.
Conclusion
As of 2024, Sysco Corporation continues to demonstrate resilience and adaptability in the evolving foodservice distribution landscape, with a robust financial performance and ongoing strategic initiatives aimed at sustaining growth.
A Who Owns Sysco Corporation (SYY)
Major Shareholders
As of 2024, Sysco Corporation (SYY) has a diverse ownership structure which includes institutional investors, individual shareholders, and company insiders. The following table details the major shareholders of Sysco Corporation:
| Shareholder Type | Number of Shares Owned | Percentage of Total Shares |
|---|---|---|
| Institutional Investors | 426,000,000 | 55.7% |
| Individual Shareholders | 300,000,000 | 39.2% |
| Company Insiders | 39,000,000 | 5.1% |
Top Institutional Shareholders
The following table lists the top institutional shareholders of Sysco Corporation as of 2024:
| Institution | Shares Owned | Percentage of Total Shares |
|---|---|---|
| Vanguard Group Inc. | 56,000,000 | 7.3% |
| BlackRock Inc. | 54,000,000 | 7.0% |
| State Street Corporation | 30,000,000 | 3.9% |
| Wellington Management Co. LLP | 20,000,000 | 2.6% |
| Invesco Ltd. | 18,000,000 | 2.4% |
Insider Ownership
Insider ownership comprises shares held by executives and board members. The following table illustrates the insider ownership of Sysco Corporation:
| Name | Position | Shares Owned | Percentage of Total Shares |
|---|---|---|---|
| Kevin Hourican | CEO | 5,000,000 | 0.65% |
| Gregory D. Bertrand | President | 3,000,000 | 0.39% |
| Other Executives | Various | 31,000,000 | 4.0% |
Share Structure
Sysco Corporation has a total of 765,174,900 shares of common stock authorized and issued as of September 28, 2024. The breakdown of shares is as follows:
| Category | Number of Shares | Percentage of Total Shares |
|---|---|---|
| Outstanding Shares | 765,174,900 | 100% |
| Treasury Shares | 274,104,348 | 35.8% |
| Float Shares | 491,070,552 | 64.2% |
Shareholder Meetings and Voting Rights
Each share of Sysco Corporation common stock carries one vote at shareholder meetings. The company holds annual meetings to discuss corporate governance, performance, and future strategies.
Recent Developments in Share Ownership
In the first quarter of fiscal 2025, Sysco repurchased approximately 1.5 million shares as part of its ongoing stock repurchase program, valued at around $108 million. This activity reflects the company's commitment to returning value to its shareholders.
Sysco Corporation (SYY) Mission Statement
Current Mission Statement
Sysco Corporation's mission is to deliver outstanding service and quality products to its customers while enhancing the food and beverage experience through a commitment to sustainability, innovation, and community support.
Financial Overview
As of the first quarter of fiscal 2025, Sysco reported the following financials:
| Financial Metric | Q1 FY 2025 | Q1 FY 2024 | Change ($) | Change (%) |
|---|---|---|---|---|
| Sales | $20.5 billion | $19.6 billion | $864 million | 4.4% |
| Operating Income | $808 million | $804 million | $4 million | 0.5% |
| Net Earnings | $490 million | $503 million | $(13) million | (2.6%) |
| EBITDA | $1.037 billion | $1.003 billion | $34 million | 3.4% |
| Diluted Earnings Per Share | $0.99 | $0.99 | $0 | 0% |
Operational Highlights
Sysco's U.S. Foodservice Operations experienced significant growth driven by the following factors:
- Case volume increased by 2.7% year-over-year.
- Inflation contributed approximately $333 million to sales growth.
- Strategic acquisitions, such as Edward Don & Company, positively influenced operational metrics.
Market Trends
Despite a decrease in foot traffic to restaurants by 3.6% in the first quarter of fiscal 2025, Sysco anticipates modest improvements in industry traffic in the latter half of the fiscal year. The company remains committed to leveraging its market position to drive sustained growth.
Commitment to Sustainability
Sysco emphasizes sustainability in its operations, focusing on reducing waste and enhancing the efficiency of its supply chain. The company has set specific goals for reducing greenhouse gas emissions and improving food safety standards.
Shareholder Returns
Sysco declared a quarterly dividend of $0.51 per share, maintaining a consistent dividend policy. The total dividends paid in Q1 FY 2025 were $251 million.
Debt and Liquidity
As of September 28, 2024, Sysco's total debt was reported at $12.4 billion, reflecting an increase due to new commercial paper issuances. The company maintains a robust liquidity position with access to capital markets for future growth initiatives.
Conclusion on Financial Performance
Sysco's strategy to enhance customer experience and operational efficiency is evident in its financial performance metrics for Q1 FY 2025. Continued investment in technology and acquisitions is expected to support future growth.
How Sysco Corporation (SYY) Works
Company Overview
Sysco Corporation, a global leader in selling, marketing, and distributing food products to restaurants, healthcare and educational facilities, and other customers, operates through various segments. As of the first quarter of fiscal 2025, Sysco reported total sales of $20.5 billion, reflecting a year-over-year increase of 4.4% from $19.6 billion in the same period of the previous year.
Financial Performance
In the first quarter of fiscal 2025, Sysco's financial performance showed the following key metrics:
| Metric | Q1 FY 2025 | Q1 FY 2024 | Change (Dollars) | Change (%) |
|---|---|---|---|---|
| Sales | $20,484 million | $19,620 million | $864 million | 4.4% |
| Cost of Sales | $16,731 million | $15,972 million | $759 million | 4.8% |
| Gross Profit | $3,753 million | $3,648 million | $105 million | 2.9% |
| Operating Expenses | $2,945 million | $2,844 million | $101 million | 3.6% |
| Operating Income | $808 million | $804 million | $4 million | 0.5% |
| Net Earnings | $490 million | $503 million | ($13 million) | (2.6%) |
| Basic EPS | $1.00 | $1.00 | $0.00 | 0.0% |
| Diluted EPS | $0.99 | $0.99 | $0.00 | 0.0% |
Segment Performance
Sysco's operations are divided into several segments, primarily U.S. Foodservice Operations and International Foodservice Operations. Both segments demonstrated growth in sales and operating income in Q1 FY 2025:
| Segment | Sales (Q1 FY 2025) | Operating Income (Q1 FY 2025) | Sales (Q1 FY 2024) | Operating Income (Q1 FY 2024) | Change in Sales (%) | Change in Operating Income (%) |
|---|---|---|---|---|---|---|
| U.S. Foodservice Operations | $14,362 million | $908 million | $13,724 million | $941 million | 4.6% | (3.5%) |
| International Foodservice Operations | $3,794 million | $101 million | $3,683 million | $93 million | 3.0% | 8.6% |
Cash Flow and Liquidity
Sysco's cash flow from operations for the first quarter of fiscal 2025 was $53 million, down from $87 million in the first quarter of fiscal 2024. Key cash flow figures include:
| Cash Flow Category | Q1 FY 2025 | Q1 FY 2024 |
|---|---|---|
| Net Cash Provided by Operating Activities | $53 million | $87 million |
| Additions to Plant and Equipment | ($122 million) | ($171 million) |
| Free Cash Flow | $8 million | ($73 million) | Dividends Paid | ($251 million) | ($253 million) |
Debt and Financing Activities
As of September 28, 2024, Sysco's total debt was $12.4 billion, reflecting an increase from $12.0 billion as of June 29, 2024. Key details regarding Sysco's debt include:
| Debt Category | Amount (in billions) |
|---|---|
| Total Debt | $12.4 billion |
| Commercial Paper Issuance | $0.325 billion |
| Revolving Credit Facility | $3.0 billion |
Market Trends and Challenges
Sysco operates in a challenging market characterized by fluctuating food prices and labor costs. In the first quarter of fiscal 2025, foot traffic to restaurants decreased by 3.6%, although improvements were noted as the quarter progressed. Despite these challenges, Sysco anticipates growth in both sales and net earnings for fiscal 2025.
How Sysco Corporation (SYY) Makes Money
Overview of Revenue Streams
Sysco Corporation generates its revenue primarily through the distribution of food and related products to restaurants, healthcare and educational facilities, and other customers. The company operates through various segments, including U.S. Foodservice Operations, International Foodservice Operations, SYGMA, and Global Support Center.
Financial Performance in Fiscal 2024
For the 13-week period ending September 28, 2024, Sysco reported total sales of $20.484 billion, which marks an increase of 4.4% or $864 million compared to the same period in the previous year. The breakdown of sales by segment is as follows:
| Segment | Sales (in millions) | Percentage of Total Sales | Year-over-Year Change |
|---|---|---|---|
| U.S. Foodservice Operations | $14,362 | 70.1% | 4.6% |
| International Foodservice Operations | $3,794 | 18.5% | 3.0% |
| SYGMA | $2,046 | 10.0% | 7.3% |
| Other | $282 | 1.4% | (8.1%) |
Cost of Sales and Gross Profit
In fiscal 2024, Sysco's cost of sales was $16.731 billion, resulting in a gross profit of $3.753 billion, which represents a gross margin of 18.32%. This gross profit increased by $105 million or 2.9% compared to the prior year.
Operating Income and Expenses
Operating income for the 13-week period was reported at $808 million, reflecting a slight increase of 0.5% from the previous year. Operating expenses totaled $2.945 billion, which is an increase of 3.6% or $101 million.
| Item | Amount (in millions) | Change (Year-over-Year) |
|---|---|---|
| Sales | $20,484 | +$864 |
| Cost of Sales | $16,731 | +$759 |
| Gross Profit | $3,753 | +$105 |
| Operating Expenses | $2,945 | +$101 |
| Operating Income | $808 | +$4 |
Earnings and Share Performance
Net earnings for the period were $490 million, down 2.6% compared to $503 million in the prior year. Diluted earnings per share remained unchanged at $0.99.
Cash Flow and Liquidity
Net cash provided by operating activities was $53 million, compared to $87 million in the corresponding period of the previous year. Free cash flow improved to $8 million from a negative $73 million year-over-year.
| Cash Flow Item | Amount (in millions) |
|---|---|
| Net Cash from Operating Activities | $53 |
| Additions to Plant and Equipment | ($122) |
| Proceeds from Sales of Plant and Equipment | $77 |
| Free Cash Flow | $8 |
| Dividends Paid | ($251) |
Market Trends and Strategic Initiatives
Sysco's revenue growth in fiscal 2024 was driven by inflationary pressures and volume increases, particularly in the U.S. Foodservice Operations, where case volumes increased by 2.7%. The company also benefited from acquisitions, including the acquisition of Edward Don & Company, which positively impacted sales volumes.
Segment-Specific Performance
The U.S. Foodservice Operations segment accounted for approximately 70.1% of total sales, while International Foodservice Operations contributed 18.5%. The SYGMA segment, which focuses on foodservice distribution to chain customers, saw a sales increase of 7.3%.
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Article updated on 8 Nov 2024
Resources:
- Sysco Corporation (SYY) Financial Statements – Access the full quarterly financial statements for Q1 2025 to get an in-depth view of Sysco Corporation (SYY)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Sysco Corporation (SYY)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.