Sysco Corp 10-Q for FY2024 Q1

Sysco Corp (SYY)

10-Q 2023-11-01 For: 2023-09-30

Added on April 08, 2026

About this 10-Q

Sysco Corp filed this 10-Q on November 1, 2023, covering the quarter ended September 30, 2023 (FY2024 Q1).

Headline figures

Quarter ended September 30, 2023, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $19.62B; up 2.6% from $19.13B a year earlier
Net income: $503.39M; up 8.1% from net income of $465.57M a year earlier
Diluted EPS: $0.99; up 8.8% from $0.91 a year earlier

Search and read filings like this one from Claude or ChatGPT with the SEC filings MCP server →


Delaware						74-1648137
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification Number)


Large Accelerated Filer	☑	Accelerated Filer	☐
Non-accelerated Filer	☐	Smaller Reporting Company	☐
(Do not check if a smaller reporting company)		Emerging growth company	☐



	PART I – FINANCIAL INFORMATION	Page No.
Item 1.	Financial Statements	1
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	39
Item 4.	Controls and Procedures	40
	PART II – OTHER INFORMATION
Item 1.	Legal Proceedings	41
Item 1A.	Risk Factors	41
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	41
Item 3.	Defaults Upon Senior Securities	41
Item 4.	Mine Safety Disclosures	42
Item 5.	Other Information	42
Item 6.	Exhibits	42

Signatures		45


	Sep. 30, 2023		Jul. 1, 2023
	(unaudited)
ASSETS
Current assets
Cash and cash equivalents	$	569,104	$	745,201
Accounts receivable, less allowances of $61,475 and $45,599	5,338,699		5,091,970
Inventories	4,648,610		4,480,812

Prepaid expenses and other current assets	333,486		284,566

Income tax receivable	5,815		5,815
Total current assets	10,895,714		10,608,364
Plant and equipment at cost, less accumulated depreciation	5,021,424		4,915,049
Other long-term assets
Goodwill	4,719,385		4,645,754
Intangibles, less amortization	874,902		859,530

Deferred income taxes	421,037		420,450
Operating lease right-of-use assets, net	773,980		731,766
Other assets	566,309		640,232
Total other long-term assets	7,355,613		7,297,732
Total assets	$	23,272,751	$	22,821,145

LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities

Accounts payable	$	5,796,398	$	6,025,757
Accrued expenses	2,176,934		2,251,181
Accrued income taxes	182,185		101,894
Current operating lease liabilities	109,669		99,051
Current maturities of long-term debt	188,978		62,550
Total current liabilities	8,454,164		8,540,433
Long-term liabilities
Long-term debt	10,703,873		10,347,997
Deferred income taxes	300,034		302,904
Long-term operating lease liabilities	695,717		656,269
Other long-term liabilities	958,614		931,708
Total long-term liabilities	12,658,238		12,238,878

Noncontrolling interest	34,550		33,212
Shareholders’ equity
Preferred stock, par value $1 per share Authorized 1,500,000 shares, issued none	—		—
Common stock, par value $1 per share Authorized 2,000,000,000 shares, issued 765,174,900 shares	765,175		765,175
Paid-in capital	1,838,986		1,814,681
Retained earnings	11,560,924		11,310,664
Accumulated other comprehensive loss	(1,326,800)		(1,252,590)
Treasury stock at cost, 260,971,761 and 260,062,834 shares	(10,712,486)		(10,629,308)
Total shareholders’ equity	2,125,799		2,008,622
Total liabilities and shareholders’ equity	$	23,272,751	$	22,821,145


	13-Week Period Ended
	Sep. 30, 2023		Oct. 1, 2022
Sales	$	19,620,454	$	19,126,830
Cost of sales	15,972,682		15,637,975
Gross profit	3,647,772		3,488,855
Operating expenses	2,844,190		2,752,054
Operating income	803,582		736,801
Interest expense	134,334		124,150
Other expense (income), net (1)	6,640		17,749
Earnings before income taxes	662,608		594,902
Income taxes	159,216		129,334
Net earnings	$	503,392	$	465,568

Net earnings:
Basic earnings per share	$	1.00	$	0.92
Diluted earnings per share	0.99		0.91

Average shares outstanding	505,126,492		507,578,576
Diluted shares outstanding	507,069,435		510,383,149


(Mark One)
☑			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


(1)			Gains and losses related to the disposition of fixed assets have been recognized within operating expenses. Prior year amounts have been reclassified to conform to this presentation.


								Accumulated Other Comprehensive Loss
	Common Stock			Paid-in Capital		Retained Earnings				Treasury Stock
	Shares	Amount								Shares	Amounts		Totals
Balance as of July 1, 2023	765,174,900	$	765,175	$	1,814,681	$	11,310,664	$	(1,252,590)	260,062,834	$	(10,629,308)	$	2,008,622
Net earnings						503,392							503,392



Foreign currency translation adjustment								(108,194)					(108,194)
Amortization of cash flow hedges, net of tax								2,170					2,170
Change in cash flow hedges, net of tax								27,148					27,148
Changes in excluded components of fair value hedge, net of tax								(20)					(20)

Reclassification of pension and other postretirement benefit plans amounts to net earnings, net of tax								5,128					5,128

Net actuarial gain arising in current year, net of tax								503					503
Change in marketable securities, net of tax								(945)					(945)

Dividends declared ($0.50 per common share)						(253,132)							(253,132)
Treasury stock purchases										1,382,947	(99,974)		(99,974)

Share-based compensation awards				24,305						(474,020)	16,796		41,101
Balance as of September 30, 2023	765,174,900	$	765,175	$	1,838,986	$	11,560,924	$	(1,326,800)	260,971,761	$	(10,712,486)	$	2,125,799

								Accumulated Other Comprehensive Loss
	Common Stock			Paid-in Capital		Retained Earnings				Treasury Stock
	Shares	Amount								Shares	Amounts		Totals
Balance as of July 2, 2022	765,174,900	$	765,175	$	1,766,305	$	10,539,722	$	(1,482,054)	256,531,543	$	(10,206,888)	$	1,382,260
Net earnings						465,568							465,568
Foreign currency translation adjustment								(232,182)					(232,182)
Amortization of cash flow hedges, net of tax								2,155					2,155
Change in cash flow hedges, net of tax								(26,390)					(26,390)
Change in net investment hedges, net of tax								23,509					23,509
Reclassification of pension and other postretirement benefit plans amounts to net earnings, net of tax								6,965					6,965
Change in marketable securities, net of tax								(3,328)					(3,328)

Dividends declared ($0.49 per common share)						(248,154)							(248,154)
Treasury stock purchases										3,099,268	(267,727)		(267,727)

Share-based compensation awards				(11,896)						(1,215,822)	24,561		12,665
Balance as of October 1, 2022	765,174,900	$	765,175	$	1,754,409	$	10,757,136	$	(1,711,325)	258,414,989	$	(10,450,054)	$	1,115,341


	Sep. 30, 2023		Oct. 1, 2022
	(In thousands)
Cash and cash equivalents	$	569,104	$	437,670
Restricted cash (1)	159,005		65,756
Total cash, cash equivalents and restricted cash shown in the consolidated statement of cash flows	$	728,109	$	503,426


(1)			Restricted cash primarily represents cash and cash equivalents of Sysco’s wholly owned captive insurance subsidiary, restricted for use to secure the insurer’s obligations for workers’ compensation, general liability and auto liability programs. Restricted cash is located within other assets in each consolidated balance sheet.


	13-Week Period Ended Sep. 30, 2023
	US Foodservice Operations		International Foodservice Operations		SYGMA		Other		Total
	(In thousands)
Principal Product Categories
Canned and dry products	$	2,684,668	$	831,543	$	232,985	$	—	$	3,749,196
Fresh and frozen meats	2,569,190		519,741		480,589		—		3,569,520
Frozen fruits, vegetables, bakery and other	2,027,934		673,548		305,299		—		3,006,781
Dairy products	1,453,960		414,171		141,431		—		2,009,562
Poultry	1,361,695		291,322		273,708		—		1,926,725
Fresh produce	1,361,357		274,718		70,318		—		1,706,393
Paper and disposables	993,837		141,163		186,543		16,282		1,337,825
Seafood	577,635		125,025		43,515		—		746,175
Beverage products	362,665		170,553		146,222		23,866		703,306



Other (1)	330,858		241,426		25,404		267,283		864,971
Total Sales	$	13,723,799	$	3,683,210	$	1,906,014	$	307,431	$	19,620,454


(1)			Other sales relate to non-food products, including textiles and amenities for our hotel supply business, equipment, and other janitorial products, medical supplies and smallwares.


	13-Week Period Ended Oct. 1, 2022
	US Foodservice Operations		International Foodservice Operations		SYGMA		Other		Total
	(In thousands)
Principal Product Categories
Canned and dry products	$	2,577,255	$	691,374	$	236,168	$	2,068	$	3,506,865
Fresh and frozen meats	2,465,450		453,364		463,440		—		3,382,254
Frozen fruits, vegetables, bakery and other	1,843,464		580,032		309,197		149		2,732,842
Poultry	1,574,251		292,849		277,464		—		2,144,564
Dairy products	1,525,483		366,847		164,648		—		2,056,978
Fresh produce	1,337,919		254,737		65,244		—		1,657,900
Paper and disposables	1,022,904		144,068		209,358		15,056		1,391,386

Seafood	638,405		121,201		40,124		—		799,730
Beverage products	315,619		136,475		138,169		24,657		614,920



Other (1)	301,732		242,788		29,645		265,226		839,391
Total Sales	$	13,602,482	$	3,283,735	$	1,933,457	$	307,156	$	19,126,830


	Assets Measured at Fair Value as of Sep. 30, 2023
	Level 1		Level 2		Level 3		Total
	(In thousands)
Assets:
Cash equivalents
Cash and cash equivalents	$	215,714	$	10,027	$	—	$	225,741

Other assets (1)	159,005		—		—		159,005







Total assets at fair value	$	374,719	$	10,027	$	—	$	384,746


	13-Week Period Ended
	Sep. 30, 2023		Oct. 1, 2022
Cash flows from operating activities:
Net earnings	$	503,392	$	465,568
Adjustments to reconcile net earnings to cash provided by operating activities:

Share-based compensation expense	24,234		27,224
Depreciation and amortization	206,007		188,924
Operating lease asset amortization	28,801		27,542
Amortization of debt issuance and other debt-related costs	4,554		5,435

Deferred income taxes	(22,201)		(31,226)
Provision for losses on receivables	17,659		3,865


Other non-cash items	(2,084)		5,011
Additional changes in certain assets and liabilities, net of effect of businesses acquired:
Increase in receivables	(284,826)		(576,585)
Increase in inventories	(184,674)		(283,252)
Increase in prepaid expenses and other current assets	(39,402)		(28,372)
(Decrease) increase in accounts payable	(187,574)		288,517
Decrease in accrued expenses	(40,173)		(10,893)
Decrease in operating lease liabilities	(26,668)		(33,319)
Increase in accrued income taxes	80,292		109,280
Decrease in other assets	20,193		17,627
Decrease in other long-term liabilities	(10,378)		(16,740)

Net cash provided by operating activities	87,152		158,606
Cash flows from investing activities:
Additions to plant and equipment	(171,364)		(167,260)
Proceeds from sales of plant and equipment	11,012		22,448
Acquisition of businesses, net of cash acquired	(219,264)		(32,651)
Purchase of marketable securities	(308)		(3,296)
Proceeds from sales of marketable securities	—		2,650
Other investing activities	—		3,274

Net cash used for investing activities	(379,924)		(174,835)
Cash flows from financing activities:
Bank and commercial paper borrowings, net	300,000		97,000


	Sep. 30, 2023
	Amortized Cost Basis		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Short-Term Marketable Securities		Long-Term Marketable Securities
	(In thousands)
Fixed income securities:
Corporate bonds	$	99,567	$	—	$	(7,211)	$	92,356	$	22,838	$	69,518
Government bonds	29,703		—		(2,579)		27,124		—		27,124
Total marketable securities	$	129,270	$	—	$	(9,790)	$	119,480	$	22,838	$	96,642

	Jul. 1, 2023
	Amortized Cost Basis		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Short-Term Marketable Securities		Long-Term Marketable Securities
	(In thousands)
Fixed income securities:
Corporate bonds	$	99,501	$	96	$	(6,777)	$	92,820	$	12,767	$	80,053
Government bonds	29,777		—		(1,913)		27,864		—		27,864
Total marketable securities	$	129,278	$	96	$	(8,690)	$	120,684	$	12,767	$	107,917


	Sep. 30, 2023
	(In thousands)
Due in one year or less	$	22,838
Due after one year through five years	58,455
Due after five years through ten years	38,187

Total	$	119,480


	13-Week Period Ended
	Sep. 30, 2023		Oct. 1, 2022
	(In thousands)
Total amounts of income and expense line items presented in the consolidated results of operations in which the effects of fair value hedges are recorded	$	6,640	$	124,150
Gain or (loss) on fair value hedging relationships:
Interest rate swaps:
Hedged items	$	—	$	2,376
Derivatives designated as hedging instruments	—		(4,759)
Cross currency swaps:
Hedged items	$	2,996	$	—
Derivatives designated as hedging instruments	(2,996)		—


(1)			Represents restricted cash balance recorded within other assets in the consolidated balance sheet.


	Assets Measured at Fair Value as of Jul. 1, 2023
	Level 1		Level 2		Level 3		Total
	(In thousands)
Assets:
Cash equivalents
Cash and cash equivalents	$	308,952	$	10,021	$	—	$	318,973



Other assets (1)	220,831		—		—		220,831

Total assets at fair value	$	529,783	$	10,021	$	—	$	539,804


		Derivative Fair Value
	Balance Sheet location	Sep. 30, 2023		Jul. 1, 2023
		(In thousands)
Fair Value Hedges:




Cross currency swaps	Other current liabilities	$	785	$	1,262
Cross currency swaps	Other long-term liabilities	2,237		—

Cash Flow Hedges:
Fuel swaps	Other current assets	9,509		102
Foreign currency forwards	Other current assets	178		624

Fuel swaps	Other assets	2,290		40

Fuel swaps	Other current liabilities	725		17,932
Foreign currency forwards	Other current liabilities	225		404
Fuel swaps	Other long-term liabilities	1		5,637


	13-Week Period Ended Sep. 30, 2023
	Amount of Gain or (Loss) Recognized in Other Comprehensive Income on Derivatives		Location of Gain or (Loss) Reclassified from Accumulated Other Comprehensive Income into Income	Amount of Gain or (Loss) Reclassified from Accumulated Other Comprehensive Income into Income
	(In thousands)			(In thousands)
Derivatives in cash flow hedging relationships:
Fuel swaps	$	34,499	Operating expense	$	2,334
Foreign currency contracts	(284)		Cost of sales / Other income	—

Total	$	34,215		$	2,334

Derivatives in net investment hedging relationships:

Foreign denominated debt	$	—	N/A	$	—


Derivatives in fair value hedging relationships:
Change in excluded component of fair value hedge	$	(26)	Other expense (income)	$	—

	13-Week Period Ended Oct. 1, 2022
	Amount of Gain or (Loss) Recognized in Other Comprehensive Income on Derivatives		Location of Gain or (Loss) Reclassified from Accumulated Other Comprehensive Income into Income	Amount of Gain or (Loss) Reclassified from Accumulated Other Comprehensive Income into Income
	(In thousands)			(In thousands)
Derivatives in cash flow hedging relationships:
Fuel swaps	$	(36,295)	Operating expense	$	12,985
Foreign currency contracts	286		Cost of sales / Other income	—

Total	$	(36,009)		$	12,985

Derivatives in net investment hedging relationships:

Foreign denominated debt	$	31,346	N/A	$	—


		13-Week Period Ended Sep. 30, 2023
	Location of Expense (Income) Recognized in Net Earnings	Before Tax Amount		Tax		Net of Tax Amount
		(In thousands)
Pension and other postretirement benefit plans:
Other comprehensive income before reclassification adjustments:



Net actuarial gain, arising in the current year	Other expense, net	$	672	$	169	$	503

Total other comprehensive income before reclassification adjustments		672		169		503
Reclassification adjustments:
Amortization of prior service cost	Other expense, net	195		49		146
Amortization of actuarial loss, net	Other expense, net	6,641		1,659		4,982
Total reclassification adjustments		6,836		1,708		5,128
Foreign currency translation:

Foreign currency translation adjustment	N/A	(108,194)		—		(108,194)
Marketable securities:
Change in marketable securities (1)	N/A	(1,196)		(251)		(945)
Hedging instruments:
Other comprehensive income (loss) before reclassification adjustments:
Change in excluded component of fair value hedge	Other expense, net	(26)		(6)		(20)
Change in cash flow hedges	Operating expenses (2)	34,215		7,067		27,148


Total other comprehensive income (loss) before reclassification adjustments		34,189		7,061		27,128
Reclassification adjustments:
Amortization of cash flow hedges	Interest expense	2,893		723		2,170

Total other comprehensive income (loss)		$	(64,800)	$	9,410	$	(74,210)


(1)			Realized gains or losses on marketable securities are presented within other (income) expense, net in the consolidated results of operations; however, there were no significant gains or losses realized in the first quarter of fiscal 2024.
(2)			Amount partially impacts operating expense for fuel swaps accounted for as cash flow hedges.


	13-Week Period Ended Sep. 30, 2023
	Pension and Other Postretirement Benefit Plans, net of tax		Foreign Currency Translation		Hedging, net of tax		Marketable Securities, net of tax		Total
	(In thousands)
Balance as of Jul. 1, 2023	$	(839,541)	$	(374,290)	$	(31,966)	$	(6,793)	$	(1,252,590)

Net actuarial loss arising in the current year	503		—		—		—		503

Equity adjustment from foreign currency translation	—		(108,194)		—		—		(108,194)
Amortization of cash flow hedges	—		—		2,170		—		2,170

Change in excluded component of fair value hedge	—		—		(20)		—		(20)
Change in cash flow hedge	—		—		27,148		—		27,148


Amortization of unrecognized prior service cost	146		—		—		—		146
Amortization of unrecognized net actuarial losses	4,982		—		—		—		4,982
Change in marketable securities	—		—		—		(945)		(945)
Balance as of Sep. 30, 2023	$	(833,910)	$	(482,484)	$	(2,668)	$	(7,738)	$	(1,326,800)


(1)			Other expense (income), net was expense of $6.6 million and $17.7 million in the first quarter of fiscal 2024 and fiscal 2023, respectively.


	13-Week Period Ended Sep. 30, 2023
	U.S. Foodservice Operations			International Foodservice Operations			SYGMA			Other			Global Support Center			Consolidated Totals
	(In thousands)
Sales	$	13,723,799		$	3,683,210		$	1,906,014		$	307,431		$	—		$	19,620,454
Sales increase (decrease)	0.9		%	12.2		%	(1.4)		%	0.1		%				2.6		%
Percentage of total	69.9		%	18.8		%	9.7		%	1.6		%				100.0		%

Operating income (loss)	$	940,971		$	93,483		$	12,767		$	11,823		$	(255,462)		$	803,582
Operating income (loss) increase (decrease)	3.9		%	7.5		%	NM			2.5		%	(6.5)		%	9.1		%
Percentage of total segments	88.9		%	8.8		%	1.2		%	1.1		%				100.0		%
Operating income as a percentage of sales	6.9		%	2.5		%	0.7		%	3.8		%				4.1		%


	13-Week Period Ended Sep. 30, 2023		13-Week Period Ended Oct. 1, 2022		Change in Dollars		% Change
	(Dollars in thousands)
Sales	$	13,723,799	$	13,602,482	$	121,317	0.9	%
Gross profit	2,684,775		2,612,343		72,432		2.8
Operating expenses	1,743,804		1,706,631		37,173		2.2
Operating income	$	940,971	$	905,712	$	35,259	3.9	%

Gross profit	$	2,684,775	$	2,612,343	$	72,432	2.8	%
Adjusted operating expenses (Non-GAAP)	1,731,201		1,696,686		34,515		2.0
Adjusted operating income (Non-GAAP)	$	953,574	$	915,657	$	37,917	4.1	%


	Increase (Decrease)
	13-Week Period
	(Dollars in millions)
Cause of change	Percentage		Dollars
Case volume (1)	1.6	%	$	206.5
Deflation	(0.4)		(49.1)

Other (2)	(0.3)		(36.1)
Total change in sales	0.9	%	$	121.3




(1)			Case volumes increased 1.6% compared to the first quarter of fiscal 2023. This volume increase resulted in a 1.6% increase in the dollar value of sales compared to the first quarter of fiscal 2023.
(2)			Case volume reflects our broadline and specialty businesses, with the exception of our specialty meats business, which measures its volume in pounds. Any impact in volumes from these specialty meats operations is included within “Other.”


(1)			The impact of volumes as a component of sales growth from international operations are included within “Other.” Volume in our foreign operations includes volume metrics that differ from country to country and cannot be aggregated on a consistent, comparable basis.


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 will be denoted as adjusted measures to remove (1) restructuring charges; (2) expenses associated with our various transformation initiatives; (3) severance charges; and (4) acquisition-related costs consisting of: (a) intangible amortization expense and (b) acquisition costs and due diligence costs related to our acquisitions. Our results for fiscal 2023 were also impacted by adjustments to a product return allowance pertaining to COVID-related personal protection equipment inventory and the reduction of bad debt expense previously recognized in fiscal 2020 due to the impact of the COVID-19 pandemic on the collectability of our pre-pandemic trade receivable balances.

The results of our operations can be impacted due to changes in exchange rates applicable in converting local currencies to U.S. dollars. We measure our results on a constant currency basis. Constant currency operating results are calculated by translating current-period local currency operating results with the currency exchange rates used to translate the financial statements in the comparable prior-year period to determine what the current-period U.S. dollar operating results would have been if the currency exchange rate had not changed from the comparable prior-year period.

Management believes that adjusting its operating expenses, operating income, net earnings and diluted earnings per share to remove these Certain Items and presenting its results on a constant currency basis provides an important perspective with respect to our underlying business trends and results. It provides meaningful supplemental information to both management and investors that (1) is indicative of the performance of the company’s underlying operations and (2) facilitates comparisons on a year-over-year basis.

Sysco has a history of growth through acquisitions and excludes from its non-GAAP financial measures the impact of acquisition-related intangible amortization, acquisition costs and due-diligence costs for those acquisitions. We believe this approach significantly enhances the comparability of Sysco’s results for fiscal year 2024 and fiscal year 2023.

Set forth on the following page is a reconciliation of sales, operating expenses, operating income, other (income) expense, net earnings and diluted earnings per share to adjusted results for these measures for the periods presented. Individual components of diluted earnings per share may not be equal to the total presented when added due to rounding. Adjusted diluted earnings per share is calculated using adjusted net earnings divided by diluted shares outstanding.



(1)			Represents a constant currency adjustment, which eliminates the impact of foreign currency fluctuations on the current year results.

(2)			Fiscal 2023 represents an adjustment to a product return allowance, related to COVID-related personal protection equipment inventory.
(3)			Fiscal 2024 includes $6 million related to restructuring and severance charges and $14 million related to various transformation initiative costs, primarily consisting of changes to our business technology strategy. Fiscal 2023 includes $4 million related to restructuring and severance charges and $8 million related to various transformation initiative costs, primarily consisting of changes to our business technology strategy.
(4)			Fiscal 2024 includes $28 million of intangible amortization expense and $3 million in acquisition and due diligence costs. Fiscal 2023 includes $26 million of intangible amortization expense and $4 million in acquisition and due diligence costs.
(5)			Fiscal 2023 represents the reduction of bad debt charges previously taken on pre-pandemic trade receivable balances in fiscal 2020.
(6)			The tax impact of adjustments for Certain Items are calculated by multiplying the pretax impact of each Certain Item by the statutory rates in effect for each jurisdiction where the Certain Item was incurred.
(7)			Individual components of diluted earnings per share may not equal the total presented when added due to rounding. Total diluted earnings per share is calculated using adjusted net earnings divided by diluted shares outstanding.


			NM represents that the percentage change is not meaningful.


(1)			Fiscal 2024 and fiscal 2023 include intangible amortization expense and acquisition costs.
(2)			Fiscal 2023 represents the reduction of bad debt charges previously taken on pre-pandemic trade receivable balances in fiscal 2020.
(3)			Represents a constant currency adjustment, which eliminates the impact of foreign currency fluctuations on current year results.
(4)			Includes restructuring costs primarily in Europe.
(5)			Represents intangible amortization expense.

(6)			Fiscal 2023 represents an adjustment to a product return allowance, related to COVID-related personal protection equipment inventory.
(7)			Includes various transformation initiative costs, primarily consisting of changes to our business technology strategy.
(8)			Represents due diligence costs.


			NM represents that the percentage change is not meaningful.


(1)			Fiscal 2023 represents an adjustment to a product return allowance, related to COVID-related personal protection equipment inventory.
(2)			Fiscal 2024 and fiscal 2023 include charges related to restructuring and severance, as well as various transformation initiative costs, primarily consisting of changes to our business technology strategy, excluding charges related to accelerated depreciation.
(3)			Fiscal 2024 and fiscal 2023 include acquisition and due diligence costs.
(4)			Fiscal 2023 represents the reduction of bad debt charges previously taken on pre-pandemic trade receivable balances in fiscal 2020.
(5)			In arriving at adjusted EBITDA, Sysco does not adjust out interest income of $12 million and $3 million or non-cash stock compensation expense of $24 million and $27 million in fiscal 2024 and fiscal 2023, respectively.

			NM represents that the percentage change is not meaningful.


	13-Week Period Ended Sep. 30, 2023		13-Week Period Ended Oct. 1, 2022
Source of cash (use of cash)	(In thousands)
Net cash provided by operating activities (GAAP)	$	87,152	$	158,606
Additions to plant and equipment	(171,364)		(167,260)
Proceeds from sales of plant and equipment	11,012		22,448
Free Cash Flow (Non-GAAP) (1)	$	(73,200)	$	13,794

Acquisition of businesses, net of cash acquired	$	(219,264)	$	(32,651)

Debt borrowings (repayments), net	407,229		137,959

Stock repurchases	(99,974)		(267,727)
Dividends paid	(252,880)		(249,294)


(1)			Free cash flow should not be used as a substitute for the most comparable GAAP measure in assessing the company’s liquidity for the periods presented. An analysis of any non-GAAP financial measure should be used in conjunction with results presented in accordance with GAAP. See Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Key Performance Indicators” contained in our fiscal 2023 Form 10-K for discussions regarding this non-GAAP performance metric.


Combined Parent and Guarantor Subsidiaries Summarized Balance Sheet	Sep. 30, 2023		Jul. 1, 2023
	(In thousands)
ASSETS
Receivables due from non-obligor subsidiaries	$	272,246	$	321,476
Current assets	5,723,242		5,149,509
Total current assets	$	5,995,488	$	5,470,985
Notes receivable from non-obligor subsidiaries	$	109,020	$	108,380
Other noncurrent assets	4,356,920		4,254,145
Total noncurrent assets	$	4,465,940	$	4,362,525

LIABILITIES
Payables due to non-obligor subsidiaries	$	139,794	$	71,175
Other current liabilities	2,210,744		2,305,435
Total current liabilities	$	2,350,538	$	2,376,610
Notes payable to non-obligor subsidiaries	$	239,892	$	240,874
Long-term debt	10,148,155		9,793,541
Other noncurrent liabilities	1,213,561		1,121,884
Total noncurrent liabilities	$	11,601,608	$	11,156,299