Sysco sales rise on lower meat, seafood costs
The lower overall cost of buying fresh seafood in the U.S. has benefitted many wholesalers and distributors - particularly Sysco, arguably the largest U.S. foodservice distributor with 196 distribution facilities serving around 425,000 customers.
Houston, Texas-based Sysco said this week that its fiscal fourth quarter sales increased 10 percent to USD 13.6 billion (EUR 12.1 billion), while its sales for fiscal year 2016 rose 3.5 percent to USD 50.4 billion (EUR 44.7 billion). “During the year, we had strong local case growth, improved our gross profit, managed expenses well and drove increased operating income,” said Sysco CEO Bill DeLaney.
The increases in sales and operating income (a spike of nearly 352 percent in its fiscal fourth quarter) is partly attributed to Sysco’s food cost deflation of 0.7 percent (0.9 percent in U.S. broadline) for its fiscal year and 1.2 percent in the fourth quarter.
Sysco’s food cost deflation is “measured by the estimated change in Sysco's product costs, with deflation in the meat, seafood, dairy and poultry categories partially offset by modest inflation in other categories,” the company said in a statement.
Case volume for the company’s U.S. broadline operations grew 5.3 percent for the year, while local case growth within U.S. broadline operations rose 4.7 percent.
While sales from acquisitions completed within the last 12 months boosted Sysco’s sales by 0.7 percent, the impact of changes in foreign exchange rates decreased the company’s annual sales by 1.3 percent, Sysco said.