Sysco Corporation (NYSE:SYY) Q4 2019 Earnings Conference Call - Final Transcript

Aug 12, 2019 • 10:00 am ET

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Sysco Corporation (NYSE:SYY) Q4 2019 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Good morning, and welcome to Sysco's Fourth Quarter Fiscal 2019 Conference Call. [Operator Instructions] We will begin today's call with opening remarks and introductions.

I would like to turn the call over to Neil Russell, Vice President, Corporate Affairs. Please go ahead.

Executive
Neil Russell

Good morning, everyone and welcome to Sysco's fourth quarter and fiscal year 2019 earnings call. Joining me in Houston today are Tom Bene, our Chairman, President and Chief Executive Officer; and Joel Grade, our Chief Financial Officer.

Before we begin, please note that statements made during this presentation that state the company's or management's intentions, beliefs, expectations or predictions of the future are forward-looking statements within the meaning of the Private Securities Litigation Reform Act, and actual results could differ in a material manner.

Additional information about factors that could cause results to differ from those in the forward-looking statements is contained in the company's SEC filings. This includes, but is not limited to, risk factors contained in our annual report on Form 10-K for the year ended June 30, 2018, subsequent SEC filings and in the news release issued earlier this morning. A copy of these materials can be found in the Investors section at sysco.com or via Sysco's IR app.

Non-GAAP financial measures are included in our comments today and in our presentation slides. The reconciliation of these non-GAAP measures to the corresponding GAAP measures are included at the end of the presentation slides and can also be found in the Investors section of our website. To ensure that we have sufficient time to answer all questions, we'd like to ask each participant to limit their time today to one question and one follow-up.

At this time, I'd like to turn the call over to our Chairman, President and Chief Executive Officer, Tom Bene.

Executive
Thomas L. Bene

Thanks, Neil, and good morning, everyone. Thank you all for joining us.

This morning, we announced financial results, which reflect improved year-over-year performance for the fourth quarter and fiscal year 2019. For the full year, we made solid progress against our multi-year transformational initiatives which we believe positioned us well to exceed our customers' expectations and deliver long-term growth. During the year, we had solid 8% adjusted operating income growth and adjusted earnings per share growth of 13%.

Starting with Sysco's full year fiscal 2019 results, sales grew 2.4% to $60.1 billion, driven by steady growth with local customers and the acquisition of several small distributors in both the U.S. and Europe which were partially offset by the transitioning of some national customers in both our Broadline and SYGMA businesses.

Gross profit for the year grew 2.9% to $11.4 billion driven by a continued shift in our customer mix as we grew local cases at a faster pace than total case growth, favorable product mix as we continue to drive growth in our Sysco Brand portfolio, not only through the addition of innovative products, but also by bringing Sysco Brand to additional geographies beyond the U.S. The continuation of our successful category management