SUPPLEMENTAL GUARANTOR INFORMATION - SUBSIDIARY GUARANTEES | SUPPLEMENTAL GUARANTOR INFORMATION - SUBSIDIARY GUARANTEES On January 19, 2011, the wholly owned U.S. Broadline subsidiaries of Sysco Corporation entered into full and unconditional guarantees of all outstanding senior notes and debentures of Sysco Corporation. Borrowings under the company’s revolving credit facility supporting the company’s U.S. and Canadian commercial paper programs are also covered under these guarantees. As of July 1, 2017 , Sysco had a total of $8.2 billion in senior notes, debentures and commercial paper outstanding that was covered by these guarantees. All subsidiary guarantors are 100% owned by the parent company, all guarantees are full and unconditional and all guarantees are joint and several, except that the guarantee of any subsidiary guarantor with respect to a series of senior notes or debentures may be released under certain customary circumstances. If we exercise our defeasance option with respect to the senior notes or debentures of any series, then any subsidiary guarantor effectively will be released with respect to that series. Further, each subsidiary guarantee will remain in full force and effect until the earliest to occur of the date, if any, on which (1) the applicable subsidiary guarantor shall consolidate with or merge into Sysco Corporation or any successor of Sysco Corporation or (2) Sysco Corporation or any successor of Sysco Corporation consolidates with or merges into the applicable subsidiary guarantor. The following condensed consolidating financial statements present separately the financial position, comprehensive income and cash flows of the parent issuer (Sysco Corporation), the guarantors (the majority of the company’s U.S. Broadline subsidiaries), and all other non‑guarantor subsidiaries of Sysco (Other Non-Guarantor Subsidiaries) on a combined basis with eliminating entries. Condensed Consolidating Balance Sheet Jul. 1, 2017 Sysco Certain U.S. Broadline Subsidiaries Other Non-Guarantor Subsidiaries Eliminations Consolidated Totals (In thousands) Current assets $ 177,495 $ 2,988,736 $ 4,867,207 $ — $ 8,033,438 Intercompany receivables 6,559,966 — — (6,559,966 ) — Investment in subsidiaries 6,451,994 — — (6,451,994 ) — Plant and equipment, net 258,527 1,276,342 2,842,433 — 4,377,302 Other assets 151,744 418,968 4,775,203 — 5,345,915 Total assets $ 13,599,726 $ 4,684,046 $ 12,484,843 $ (13,011,960 ) $ 17,756,655 Current liabilities $ 2,766,831 $ 2,605,828 $ 723,227 $ — $ 6,095,886 Intercompany payables — 1,642,663 4,917,303 (6,559,966 ) — Long-term debt 7,588,041 7,773 65,063 — 7,660,877 Other liabilities 863,338 103,784 568,415 — 1,535,537 Noncontrolling interest — — 82,839 — 82,839 Shareholders’ equity 2,381,516 323,998 6,127,996 (6,451,994 ) 2,381,516 Total liabilities and shareholders’ equity $ 13,599,726 $ 4,684,046 $ 12,484,843 $ (13,011,960 ) $ 17,756,655 Condensed Consolidating Balance Sheet Jul. 2, 2016 Sysco Certain U.S. Broadline Subsidiaries Other Non-Guarantor Subsidiaries Eliminations Consolidated Totals (In thousands) Current assets $ 3,440,206 $ 3,813,524 $ 2,800,169 $ — $ 10,053,899 Intercompany receivables 1,348,425 — 749,083 (2,097,508 ) — Investment in subsidiaries 6,694,615 — — (6,694,615 ) — Plant and equipment, net 429,890 1,587,702 1,862,850 — 3,880,442 Other assets 213,186 642,525 1,931,752 — 2,787,463 Total assets $ 12,126,322 $ 6,043,751 $ 7,343,854 $ (8,792,123 ) $ 16,721,804 Current liabilities $ 621,925 $ 111,728 $ 3,700,803 $ — $ 4,434,456 Intercompany payables — 2,097,508 — (2,097,508 ) — Long-term debt 7,145,955 62,387 128,588 — 7,336,930 Other liabilities 878,834 248,493 268,097 — 1,395,424 Noncontrolling interest — — 75,386 — 75,386 Shareholders’ equity 3,479,608 3,523,635 3,170,980 (6,694,615 ) 3,479,608 Total liabilities and shareholders’ equity $ 12,126,322 $ 6,043,751 $ 7,343,854 $ (8,792,123 ) $ 16,721,804 Condensed Consolidating Statement of Comprehensive Income Jul. 1, 2017 Sysco Certain U.S. Broadline Subsidiaries Other Non-Guarantor Subsidiaries Eliminations Consolidated Totals (In thousands) Sales $ — $ 27,200,744 $ 29,987,271 $ (1,816,876 ) $ 55,371,139 Cost of sales — 21,912,558 24,717,950 (1,816,876 ) 44,813,632 Gross profit — 5,288,186 5,269,321 — 10,557,507 Operating expenses 931,498 3,123,076 4,449,762 — 8,504,336 Operating income (loss) (931,498 ) 2,165,110 819,559 — 2,053,171 Interest expense (income) 260,365 (95,687 ) 138,200 — 302,878 Other expense (income), net (23,740 ) (837 ) 8,640 — (15,937 ) Earnings (losses) before income taxes (1,168,123 ) 2,261,634 672,719 — 1,766,230 Income tax (benefit) provision (412,511 ) 800,537 235,701 — 623,727 Equity in earnings of subsidiaries 1,898,115 — — (1,898,115 ) — Net earnings 1,142,503 1,461,097 437,018 (1,898,115 ) 1,142,503 Other comprehensive income (loss) 95,381 — (9,317 ) 9,317 95,381 Comprehensive income $ 1,237,884 $ 1,461,097 $ 427,701 $ (1,888,798 ) $ 1,237,884 Condensed Consolidating Statement of Comprehensive Income Jul. 2, 2016 Sysco Certain U.S. Broadline Subsidiaries Other Non-Guarantor Subsidiaries Eliminations Consolidated Totals (In thousands) Sales $ — $ 33,932,334 $ 18,112,973 $ (1,678,388 ) $ 50,366,919 Cost of sales — 27,485,111 15,519,724 (1,678,388 ) 41,326,447 Gross profit — 6,447,223 2,593,249 — 9,040,472 Operating expenses 944,457 3,857,415 2,388,100 — 7,189,972 Operating income (loss) (944,457 ) 2,589,808 205,149 — 1,850,500 Interest expense (income) 381,122 (145,852 ) 70,876 — 306,146 Other expense (income), net 128,777 (1,876 ) (15,554 ) — 111,347 Earnings (losses) before income taxes (1,454,356 ) 2,737,536 149,827 — 1,433,007 Income tax (benefit) provision (490,579 ) 923,416 50,548 — 483,385 Equity in earnings of subsidiaries 1,913,399 — — (1,913,399 ) — Net earnings 949,622 1,814,120 99,279 (1,913,399 ) 949,622 Other comprehensive income (loss) (434,921 ) — (52,306 ) 52,306 (434,921 ) Comprehensive income $ 514,701 $ 1,814,120 $ 46,973 $ (1,861,093 ) $ 514,701 Condensed Consolidating Statement of Comprehensive Income Jun. 27, 2015 Sysco Certain U.S. Broadline Subsidiaries Other Non-Guarantor Subsidiaries Eliminations Consolidated Totals (In thousands) Sales $ — $ 32,626,221 $ 17,477,986 $ (1,423,455 ) $ 48,680,752 Cost of sales — 26,572,257 14,980,434 (1,423,455 ) 40,129,236 Gross profit — 6,053,964 2,497,552 — 8,551,516 Operating expenses 1,232,956 3,709,320 2,379,878 — 7,322,154 Operating income (loss) (1,232,956 ) 2,344,644 117,674 — 1,229,362 Interest expense (income) 323,918 (108,233 ) 39,122 — 254,807 Other expense (income), net (9,496 ) (3,609 ) (20,487 ) — (33,592 ) Earnings (losses) before income taxes (1,547,378 ) 2,456,486 99,039 — 1,008,147 Income tax (benefit) provision (493,263 ) 783,066 31,571 — 321,374 Equity in earnings of subsidiaries 1,740,888 — — (1,740,888 ) — Net earnings 686,773 1,673,420 67,468 (1,740,888 ) 686,773 Other comprehensive income (loss) (280,534 ) (232,185 ) 232,185 (280,534 ) Comprehensive income $ 406,239 $ 1,673,420 $ (164,717 ) $ (1,508,703 ) $ 406,239 Condensed Consolidating Cash Flows Jul. 1, 2017 Sysco Certain U.S. Broadline Subsidiaries Other Non-Guarantor Subsidiaries Elimination (1) Consolidated Totals (In thousands) Cash flows provided by (used for): Operating activities $ 1,472,847 $ 2,908,792 $ 557,343 $ (2,762,557 ) $ 2,176,425 Investing activities (3,274,566 ) (142,124 ) (294,771 ) 127,000 (3,584,461 ) Financing activities (1,463,168 ) (2,782,134 ) (9,964 ) 2,635,557 (1,619,709 ) Effect of exchange rates on cash — — (22,104 ) — (22,104 ) Net increase (decrease) in cash and cash equivalents (3,264,887 ) (15,466 ) 230,504 — (3,049,849 ) Cash and cash equivalents at the beginning of period 3,376,463 34,069 508,819 — 3,919,351 Cash and cash equivalents at the end of period $ 111,576 $ 18,603 $ 739,323 — $ 869,502 Condensed Consolidating Cash Flows Jul. 2, 2016 Sysco Certain U.S. Broadline Subsidiaries Other Non-Guarantor Subsidiaries Elimination (1) Consolidated Totals (In thousands) Cash flows provided by (used for): Operating activities $ 990,695 $ 4,101,840 $ 767,607 $ (3,927,000 ) $ 1,933,142 Investing activities 20,094 (212,270 ) (408,652 ) — (600,828 ) Financing activities (2,485,444 ) (3,881,879 ) 35,592 3,927,000 (2,404,731 ) Effect of exchange rates on cash — — (138,327 ) — (138,327 ) Net increase (decrease) in cash and cash equivalents (1,474,655 ) 7,691 256,220 — (1,210,744 ) Cash and cash equivalents at the beginning of period 4,851,075 26,378 252,591 — 5,130,044 Cash and cash equivalents at the end of period $ 3,376,420 $ 34,069 $ 508,811 — $ 3,919,300 Condensed Consolidating Cash Flows Jun. 27, 2015 Sysco Certain U.S. Broadline Subsidiaries Other Non-Guarantor Subsidiaries Elimination (1) Consolidated Totals (In thousands) Cash flows provided by (used for): Operating activities $ 1,019,873 $ 191,181 $ 422,884 $ (78,454 ) $ 1,555,484 Investing activities (160,234 ) (108,099 ) (386,013 ) — (654,346 ) Financing activities 3,832,479 (84,476 ) 71,105 78,454 3,897,562 Effect of exchange rates on cash — — (81,702 ) — (81,702 ) Net increase (decrease) in cash and cash equivalents 4,692,118 (1,394 ) 26,274 — 4,716,998 Cash and cash equivalents at the beginning of period 158,957 27,772 226,317 — 413,046 Cash and cash equivalents at the end of period $ 4,851,075 $ 26,378 $ 252,591 — $ 5,130,044 (1) Represents primarily inter-company dividends paid from the subsidiaries to the parent, Sysco Corporation. |