SYY - Earnings call transcript Q2 2022

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Operator

Good morning, and welcome to Sysco's Second Quarter Fiscal 2022 Conference Call.

As a reminder, today’s call is being recorded.

We will begin with opening remarks and introductions. I would now like to turn the call over to Kevin Kim, Vice President of Investor Relations. Please, go ahead.

Kevin Kim

Sysco's fiscal to earnings welcome and second XXXX quarter call. Hello, Hourican, call, Alt, and Officer. we today's our our have Financial Aaron On and Kevin President Officer; Chief Chief Executive

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

comments I'd that Hourican. reconciliation to to today Kevin to ensure section to of time, in questions, end can Investors today limit follow-up. found cause the is website. turn release issued measures this This results copy sufficient our year our can found our presentation these slides. forward-looking at these to, could differ to measures one is Additional A ended to from to of be earlier materials in the information their included the that over one contained be we'd Annual X, about limited in of The in presentation we corresponding included GAAP measures like the slides have financial the to statements the sysco.com. XX-K Form SEC ask the Non-GAAP July at the answer those news this all At time factors in not on factors Investors filings are risk non-GAAP time section company's includes, call contained and like each participant in Report is in subsequent question SEC of morning. filings. for the XXXX, and and in To our and the but

Kevin Hourican

topics joining. thank I and today you four everyone, morning, our call. Good during highlight will for

First, our quarter. for results the financial

some color state COVID and business the provide of environment. Second, current the our on will I

with gains our our our detail. results some more Third, to Aaron the continued I macro I'll Growth financial game, to outline discuss transformation. turn will share to long approach And our Recipe then finally, for over despite I difficult detail highlights a will it environment. in of

So four. Earlier reported acceleration morning, by momentum share results and gains. let's on quarter that fiscal get results top displayed substantial Sysco fueled of were with an financial started slide line our this market second

volume Growth. in Our sales and our is Recipe testament performance our a success for chain advancement to supply of the strength

more expenses elevated due which this operating to delivered effects sales period Our bottom gains. result, And business. a quarter variant volume the Key improvements growth results expectations performance. expectations impacted Omicron strong for December our below times versus line delivered and moment. the were on sales results market growth COVID throughout headlines until market, of as the than XX.X% We our include were the for share for XXXX our of our quarter. and of X.X on our in the More quarter period. a Omicron sequential the the exceeded We

will challenges near-term detail challenges labor presenting moment. supply I confident, over we operational labor by environment costs, COVID operating I improve transportation a our to in incremental time. our As expenses and our chain this driven expenses, But that expectations within above due the are to that is costs. these were complex environment will mentioned, remain

years expenses today, market for will of position operating the for an advancing two quarters during continue outperform our to business. quarter. We Growth to advanced state believe elevated we of uniquely us strategy, on come. income per enabled for strategy an strategic to enable difficult Topic Sysco environment. have sheet of operating to and results a marketplace share economic for reality the balance the That Recipe the long-term. the earnings and $X.XX Sysco's and and sales win strong statement Sysco will update in Our the resulted further in strength which for adjusted our

As was in explain labor costs. supply the being relative I the and industry, is At that I stronger would labor higher in than chains impact and than the of the across anticipated. we over like from addressing. shortages hired to to some of COVID been transportation pressures QX Sysco, quarter anticipated are globe to to product effect availability suppliers new and support associates had a is and faster mentioned coming further The recovery elevated we which of felt impact moment our cost continues have our negatively ago, first past thousands our the quarter.

needs. sectors, hiring We are which business also our across to adds market our winning share

result higher ratio higher planned. we a in associate associates turnover, our originally newer The supply than our had A we of associates higher are hiring industry-wide is we rate of less productivity can and curve that of direct an move will much higher impact new population of that over productivity With our new at associates a of chain a experienced associates population that up productivity. a time. rate said, we negative has punch on our As our line and have tenured perform associates. the confident than labor

We by our a challenges we out for resources COVID XX% month cover illnesses of Sysco, workforce we our of have minimum partners To come in let that these magnitude go disruption, care, this health supported a COVID. these without quarter education, also properly supplemental tested have cannot ensure the important our absences, for because to invested overtime and provide customers. and several restaurant related food into of days. At we positive January. labor hospitality were COVID incurred caused third-party in and higher of of the the during and nearly sense than planned accelerated To January expenses as US of

ensure in and the we to full ship time growth. will with our retention can our approach and centric benefit relationship customer long-term, that on Our impacting for positively customers

We are stronger measured Promoter industry our that is our performance Net confident Score. the as by than service

In the expanded market fact, our NPS performance quarter. the versus in

starting performance, our line the I as weekend Thanksgiving. mentioned, Lastly, top after impacted Omicron negatively

on first major Our reintroduction was our business impacted in Europe with customers. restrictions of the

December performances and those by in in Canada. most volume were UK, impacted the and notably France restrictions, sales Our

the For to types example, performance began customers' with our restrictions restaurants of majority ease ordering dining second of on-premise impact These starting end at the of patterns. for February. quarter in and slowly in the Canada restrictions closing

that As to receives. third levels from the but pattern confident performance uncertain, line and our continue began felt three, Omicron into weekend, a that to we of as impact top get turn will share is to Topic volume result, on The let's Thanksgiving are Omicron are Omicron we signs highlighted back market we that return seeing the being pre-Omicron growth expect speed quarter. the the Sysco quarter, to slide in X. progress we to the the challenges impact month exceptional sales restrictions performance see again of Despite can of slide XXXX sequentially Europe easing. compared improved levels volume like until the at highlight X, begun every as would end I presented in market of have second you to and versus Sysco's growth on delivered quarter. by the Omicron the as

will result, growth for As our a we the market the now full are target X.Xx exceed we confident year. fiscal

versus buying consistently Sysco. that compares purchased have percentage we Sysco. the from beginning exclusively the we looking expanded are performance dotted line the quarters, NPD, industry. This customers ahead to from not over increased from next the last the pull years, the over shows X slide back Our of X Furthermore, percentage the to shows how quarter. The yet of market last of that this customers

the see steadily points dotted winning can are that the that You working. declining. is X our just is is that marketplace more slides line strategy and These team proof in our

update and business will that X, and Your give transformation an examples Program. how I topic growth Today, our Way enable will our highlight Cuisine in Lastly, initiatives X our growth. on Italian of consistent profitable I will Sysco progress

and to we serve dense model what we As neighborhoods. we new customers call this with a are piloting enhanced providing of reminder, Way a better levels are support. sales Sysco Your Through is our program, service that service restaurant

the success We pilot are and expanding XXXX. in we be neighborhoods pleased new will the spring to locations, the very program of the net of with

Italian addition on like platform Way, would work. Your an to I to update provide Sysco In our cuisine

with the win. and the segment. important have optimal selling Sysco reminder, historically we to cuisine underpenetrated go-to-market not Italian As of did is an a and assortment, customer one lap segments strategy this largest We

in has meaningful changed Our capability a acquisition Greco way. that

great to exceeding bottom First top and start line off, is is and expectations. our Greco Year X a off

the business We and are great pleased the with really work doing. Greco that are they

product the for priority for selling and As and to importantly, prowess country. Greco the the like assortment is Growth course. on the best-selling Winning Italian items leveraging Sysco that in Recipe More are a specialty sectors our we bringing houses across strategy. due in

are to for marketplace. summary, Slide the winning as company X. Turning quarter, the In in we a

We and are new with customers. our growing existing business

Growth for being is our supply strategy. growth year-to-date year the the chain strength driven exceeding our is for industry our Recipe and Our target and by X.Xx

We during $XXX quarter. of also the returned to over cash shareholders million our

initiatives large. to that enabling confident at We grow over consistently are our of time, will the market outperform impact the us

I up wrap at of my to our associates challenging. all I Sysco. past been years X As have These remarks, prepared thank want

Jill to of sales, center they persistence conditions. I'll our really another We of support regardless modern digital proud to for operations focus am capabilities. I our by their to the also our customer appointed of a experience, their COVID recently consumer am and want side. the use service perspective associates their have Ali and skills displayed. strategy global continue deliveries tenacity industry finance, to customers and from including welcome Kenney I industry that Dibadj, I and serve work they make Together, Golder inventory, and lead teams them of a I endurance. Paul. thank and bring Alison and for like these honored word, members would Directors: Board to the deep and

who transformation over Our Sysco before turn questions. members extremely we provide years it up to for to our now I'll valuable additional to will open be X for Board come. new details Aaron it in financial will

Aaron Alt

Thank morning. you, Good Kevin.

Here financial second are XXXX fiscal our headlines. quarter

terms management gross sales increase to at growth and As inflation, compared versus XX.X% last QX a cost sales for of year, year, of to highest which adjusted operating during on leading doubling to profit our income notwithstanding in X, XX.X% fiscal EBITDA adjusted highest worsened the XX.X% Sysco. QX A Good any Slide cost product environment, seen compared up of recording quarter. ever. XXXX, also in absolute the dollar our a last

allocation, Proactive operating, labor our action $XX capabilities. creating Continued we which $XX operating capital with our investments experienced in and we recruiting workforce of growth, during of from our on resulting the the sign-on our snapback customer those we for commercial quarter, let's with long-term environments challenges quarter. we are recipe COVID in and vaccination million contract in the quarter, of of and With against details such our elements pandemic-related quarter, $XXX marketing, strategic costs our higher refinanced and magnitude than we on prioritization the investment overtime costs, investments, the long-term investments shareholders. financials labor cash and generated hiring while productivity expense debt respect last service. safety and the the turn quarter our the much some momentum million foresee against transition to for thoughts greater to million could transitory table, the promotion, as retention returned was in bonuses on and with on With operating to outlook. headlines And some

XX.X% US $XX.X the pre-Thanksgiving Foodservice, total versus XX.X% an segment, up subset showed were fiscal and our International and markets sales versus increased SYGMA Sales fiscal are sales. UK United XX.X% trends versus resurgence fiscal sales we volume up XX% carefully. States, in we up comparable fiscal operations US US accelerating rationalization X% XXXX. versus from even operations, in In of reflecting up QX. of and the fiscal increased and international broadline volumes up versus the lockdown quarter case XX.X%, within and from while and down Second within onset XXXX case pre-Omicron such were XXXX International segment earlier, following XX.X% and expect fiscal in XXXX post watching broadline XXXX, with approximately will progress, our XX.X%. complete as sales of large Omicron a increase disclosed Local in and basis on fiscal XX.X% versus the which the be were and customer sales XXXX, key we excellent XX% our XXXX, our before trends XXXX. a nicely volume USFS, the were increase fiscal billion, restrictions largest

of Sysco's a had positive sales X.X% rates impact results. on exchange Foreign

and XXXX, XX.X% we gross XXXX the the versus in in and quarter, in continue our as XXXX was also versus volume our XXXX, in reporting restrictions profit to to driven quarter and The in the and increasing of of compared in improvements profit including same segments continued across approximately fiscal approximately We US customers XX.X% enterprise managed product international increases case during fiscal not to the are by broadline profit while XXXX second dollars the as our second by rate on math during suppliers addressing business. per for quarter increase fiscal on with year-over-year successfully was and for monitor X%. Gross ease, product gross inflation. fiscal our XX.X% the $X some, profit exceeding all was quarter increased both the Ireland Inflation margin costs. our impacted fiscal four all, at increased billion our costs rate the of gross Gross quarter by to in margin factor a operating starting the business but in impact UK. be

an inflationary Of profit course, it is in that count environment. gross dollars

$X.X a planned driven by prior the associated significantly adjusted increased the to first, increased costs four variable at increases billion things; unexpected volumes. back really Turning and with from expense in the expense of came combination year, operating with enterprise,

quarter. Second, see slide million XX, the expect decline which as more we than you third in to on $XX of snapback, and with transitory associated can expenses the short-term one-time

forward. select to be have the and going locations, offset by productivity are wages in While cost-out not increased increases material we and opportunity those have improvements

earlier, assortment Kevin elevated third-party cost Sysco $XX and emphasize support investments the track to aggressive the pursuing the Third, at million like tools personalization, trucks initiatives, sales management labor remain against purposeful productivity Recipe for of capabilities, challenges our in that to warehouses of And the expense face want time team Growth and increases. and associated of the elevated been rest operating our staff higher be absences. year. on digital expense the in overtime fourth, I productivity new with referenced ramp-up the cause in of has which including for

half of is totaled has cost approximately million of structure a negatively EPS $X.XX. action XXXX pushed operating our the adjusted company delivered the from While in the as down leveraged expenses as XXX basis All-in, opportunities in hard profit fiscal fiscal impacted transformation percentage investments quarter, sales which team incremental expense points and operating in the continues the also Together by and adjusted we of initiatives, our which this flat back identify costs unabated, the snapback beyond to the and expense from approximately XXXX. XX.X%, stabilizes. environment help $XXX reduction and should transformation and

cost-out meaningfully assess our Our and and benefiting to P&L, execute efforts we projects new continue cost-out against are quarter. each

the of increased improvement by on for million. million offset $XXX year International, progress by SYGMA. continued Finally, primarily quarter driven XX% from was second US income and fiscal $XXX from partially a This XXXX, profitability Foodservice adjusted operating to last in

$X.XX per by specific was SYGMA management which to taken quarter year. costs, offset labor will to be Adjusted actions already operating second future loss The by last $X.XX driven quarters by in compared increased the to second higher-than-expected SYGMA quarter for earnings team. the share

sheet. basis, equivalents on was cash by we on working investment of the payments higher a expected share billion was capital. in interest, driven couple Net cash quarter, $XXX on the operations equipment. year-to-date free of $XXX.X flow and Cash higher comments on million, and $XXX cash end increased from and lower lower million by flow income cash and given tax a offset somewhat CapEx let lead-times and a had second significant me flow Now, At Adjusted year-to-date fleet our the million. was $X.X of than hand. balance

during priorities. rates, at further our lowering sheet and our slide balance capital This refinancing costs the As going by debt longer more of results strengthening included expense successfully quarter interest maturities reflected quarter against incremental forward. also attractive on adjusted our this progress the seen XX, allocation our

previously dividend communicated, QX. quarterly dividend approximately our total per price This during address dividend quarter a commenced share repurchase million second our our of and per also to shares our program paying at next We $XXX in and We the around share share repurchased as million of during October. growing $X.XX our average to in addition was X.X committed of remain for $XX.XX. planned decisions fiscal to an share

as cumulatively, $XX track last back returned our you over slide have we on cash see over to goes record the While years, seven shareholders. can of XX, decades, billion

the to now look turn Let's forward.

Our transformation track. for on Recipe Growth is plan

a had and into noticeable December our February. results impact now January on Omicron continuing However, QX and

are As guidance record will reaffirming of long-term growth we XX% our of $X.XX. a result, XXXX, for that at Sysco adjusted EPS EPS least our XXXX fiscal deliver over

the reflect realities of and by our to updating half Omicron of view caused We the the environment. are the labor disruption back

for We prior expect XXXX. our year below to guidance EPS fall fiscal

is adjusted half to EPS year, half This fourth fiscal in In we of to for XX% $X.XX. second our EPS year, normal expect weighted full $X.XX a to the generally and expect business. of $X.XX. profitability adjusted to back This EPS due in pre-COVID the even $X seasonality approximately our be QX quarter. about year, translates XX% QX the half weighted typical we around of For to adjusted more to second our to

We variant a expect improved closing no this we volume me turn call that, stronger to and specific QX anticipated the QX over recovery, to this a actions remarks. COVID to perspective, expenses, as to With let In Omicron. disruptions environment. productivity our offering operating snapback Kevin for further offset operating lower of relative year assuming are are we back result taking

Kevin Hourican

Thank you, Aaron.

As we I'd provide a like conclude, to brief summary.

acceleration top substantial included momentum gains. of and market quarter our this an share line First,

presented line. on share. confidence top that We the win that bottom With said, our in are we will and winning we QX Omicron challenges continue both marketplace, have to and from

Our post-Thanksgiving into continued growth that has sequential and January. progress headwind stalled volume

quarter. expenses our More COVID-related increased the importantly, staffing disruptions operating for

our below were expectations. results line bottom our result, a As

And shoots in of see confident as as we we our recedes. Second, green can volume that we of progress the soon resume February will our despite improvement are the a on perspective. volume short-term from business, variant Omicron impact

As relates management our expenses, improve operating a year-to-go to expenses. we it to have plan

training We of improvement year. a These of the leadership remainder the core team are Sysco competency meaningfully for and are and retention, activities focused has on improving productivity. experienced a plan field deliver to associate our

Sysco. Third, trajectory at we and as remain guidance in reaffirming long-term stated, includes EPS are sales that And the confident long-term growth. significant Aaron our we

ahead Sysco creating the help are grow share enable for The us our term. efficient. Growth you days now Operator, customer-first journey. we more solutions grow Sysco enable long is it that for be developing and to over are bright will can of also I proud be to at Recipe the capabilities for for profitably part to us transformation and There am turn Our profitably Sysco, will questions.

Operator

you, [Operator Edward Instructions] sir. of from Thank question Your of the Kelly first comes Fargo. Wells line

Edward Kelly

morning. good guys. Hi,

do and Omicron pretty the that more disruptive snap we snapback Can QX Aaron, costs mean, quantify then And addition about saw it been back QX related So in provided, all much I that Kevin point? additional to you think has your or in how obviously, that you that? how operations transformation to you in to QX Is and those this is recently. like cost in that? then costs at

Kevin Hourican

good up top you refer to holiday What back progress on overall remarkable the making and remarks to pieces was plan. line a additional and supplements. through couple going us the was earlier against the our Thanksgiving were Hi, indeed then on I'm of Great we to morning. questions. the provide that of

cost, our quarter, the expenses. vaccination the combination on million incurred which we But of training, cetera. sign-on of is labor, et volumes and the on to With bonuses, of see contract certainly credits, for retention we bonuses, operating the impact onset start snapback Omicron, $XX

in working we're overtime in by but of But million more transformation is response, serving driven that force other the than that referenced and two million impacts incurred also script $XX productivity not us and I also costs. customer then labor We with the both the transition. those our ensuring what's numbers on $XX

Edward Kelly

do that those gave case And as that where so QX, how X% we great. think we're think I Yeah, well? relative you is help and costs this with are you other versus think about in talked about out we us and as about the QX how of QX? then, then XXXX US about follow-up, modeling running QX, That's – do in then volumes the do kind now I – helpful. And aspects, we internationally but level in I mean, guidance helped guess, how to my there know like

Aaron Alt

starting Why December equal From OpEx don't then an to our back rate. Kevin described green into OpEx, some in experienced alluded But perspective, not And expectations prepared is I does January, in shoots in shoots what green pre-Omicron volume. remarks. as as we're see on to touch toss run the we February. continued Kevin to we on to,

against we we QX emphasizing which our on QX and that to in in expect chain down the supply anticipating and are as have we shoots, split cost our if good that scale guidance in on team, and withstand to will the our calling heavily be purposeful XX/XX, and we Kevin? to back to seasonal our the back the between green not Omicron anticipating half updated guidance the snapback work you We're make the progress have weighted our will, is -- QX, QX. environment, results the continued will the that between also our We out do well. come annual half. in were why given work that both remarks But productivity do, given

Kevin Hourican

for Good Thanks question. the morning. Yeah. Thanks, Aaron.

sequentially Just January. month, to the by each sequential every January chart, taking five December comments the of we're all months so was was we which because the remarks of impacted. in were for improving beginning market, improvement of rest our case as evidenced the from it in fiscal share of impacted market and restrictions prepared in really relates year. aggregate. place of away Again, as winning slide to volume case is we had pull my in QX were continues volume, growth, last consecutive one

progress green yet as but some to fully begin February see we're shoots to beginning not of are restrictions in or We levels. to pre-Omicron signs back ease, the

on-premise restriction dining We have Canada. in restaurant XX%

locations well the heavy, orders which States, as traffic, northern still home, UK. daypart have heavy the urban We work work France you mandatory in within in restaurant And know. then impacts and from United in work-from-home

So is, we're as restrictions that, ease, What back vaccine, and impact we not confident to passports psychology very things the tied to quite are in people's customers our were. mask we out. where going mandates that on like

fast staffing prepared we ease, things a a we're prepared those level we're from from to and we're perspective, our be As recovery see from inventory from prepared service an customers perspective perspective, able continue when ready, to expect from the market serve away our from questions. and for it. customers we growth to to industry the Thanks We appreciate pull are perspective. a the versus

Edward Kelly

Thank you.

Operator

Your Jefferies. next of Slagle question comes line from the Alex of

Alex Slagle

Thanks. Good morning.

Aaron Alt

Good morning.

Alex Slagle

things What to do for you've we've better company important you events improvements most changes the think as mean, or confidence through? for headwind, I made might less to of of events unexpected would more are perhaps that be impact Sysco? that perhaps that a investors share prepared a or be even like are less a been future surges the of this opportunity obvious gain that give

Kevin Hourican

Alex. Kevin. question, is This Great

management, Just products. have perishable foremost, we inventory first and

with We've in need results significantly we agile be fast managing from very inventory X first COVID regards see shrink our that. performance you good spoilage. risks declines, at And just, volume associated years it ago can when improved in our super to as gotten So and and to management began. is at

much we in another December people would penny-wise, Omicron another in labor furlough attempted we Board to Pennies made company. that in to as twice in restock and support going environment, job save things bring call industry dollar-foolish to they're is from impacting, our the back we going as strategy, our began were off cost second the not at be That a January, staff. us back someone, get associates furlough decision. one that, with and a we in the could furloughing furlough because labor December bench when would today's staff of The full I of

be our we of So be those for to January. made purposeful types over that to any make less will not not of staff, December single time, period to decisions. My fortunate enough company. person That are smaller, that would very pay not companies and guess capitalized a choice able furlough dividends

QX have a continued of on driving an XXXX. just In moment ready we from fact, they things we'll you most kicked hired isn't ready. the literally be tailwinds are planning this sufficiently, Sysco hiring the and are call industry the in will return to drivers keep in in handful March have into have companies follow-up. occurred, of kicking would anyone, not these truck standards, business as thousands after of and Because Sysco has At in in time, processes, It's in, business that's entire We curveballs. business their business seat we as not even did getting be our of trained sector recovery we passenger recovery have we truck in that we've you serve January. pretty if holidays. and only and there's furlough people Sysco That December gotten be back on to agile that prepared, but begins. were we and anticipating sector January and here. of you And that's as a yet not the own that with that industry mind to a Those when, had work as to what volume dealing the will and the know, industry. predict back to But future that we be been hard at different begin a will in back hundreds

Alex Slagle

through helpful. calendar branded customer see just progressing on supply is mix. chain impacted how this product do you that How the challenges versus preferences? A year? And follow-up That's the by the Sysco

Kevin Hourican

increase it as opportunity this to factual. view cobrand an first We

Our is fill in-stock and Sysco exceeding brand rate national brand. important. That's

product, with is Sysco an work very the important ability priority Sysco in profitable to stock that partners And products we again, us. Our for well. for in doing keep Sysco they're elevated brand knows to than a those produce And because Point an brands. would. everybody aggregate and in-stock punch higher it's rate brand of than That's has elevated, bigger inflation one. has being currently normally point national of even two, it that

points our sales they opportunity product not Sysco money and we XXX from we in see did team customers purchased view And in brand that are a into with progress of QX of our and brands with we a to to years. that further fact, customers' save basis have products tailwind introducing doing before. would as regard the perhaps job Sysco So view high-quality I in penetration, progress an on QX coming good

Alex Slagle

Thanks. it. Got

Kevin Hourican

Thanks a lot.

Operator

comes line from the John next Heinbockel Your Partners. of Guggenheim of question

John Heinbockel

let it -- an X.X% start if thoughts and example, with from close to your get unit on get that you to Kevin, to guys inflation for on if What's take to -- right, market do would role? have goal grow your to gains you want food home. two get me elevated a play So grew where to faster for thought bigger you share demand, could can times And that? than away to on What then and that you XXXX. impact slower the

Kevin Hourican

Tied thanks questions. to it's at inflation, John, for the time. double-digit this

for double-digit it's As any industry been know, you us of than longer like. in would now the

each a that to seeing yet in we And P&L. elasticity hard is that reportable recent a In segments. It Aaron the seen persist, demand not we're able not and predict reduction as consumer of but said, obviously that per most how to purchasing has have positive. to GP of long dollars consumer case it's increased be in We pricing impact helped tied quarter, our will higher our inflation.

cost find we're through doing passing good a of job So job a of helping also lower doing We're our alternatives. good customers inflation.

same their can they on keep so the Portion can menu, So they as narrowing optimization the from so to do so menu on increase of you that a the their COGS them. number lower profitability. menu ticket and size, know, items the suggestions,

going inflation. in than see need for supplier availability are protein. overall well. to even of on Protein Sysco. higher So the basket priority progress It's a those things We is

longer-range protein the as the are with partners the perspective. additional have us of the And to We down. we category or we to working can forecasts can protein inflation in that's on supplier for working as work be they in we need because hard from protein category inflation purchase Sysco, volume supplies number an one our find in sources bring to from consistency production. that John, their are focus so so they efficient

goal to was which we we can said to today which faster question, your are are we of X.X%. for half on that than report second grow this yes, we the quarter, track our exceeding to relates X.X, X.X. it deliver Prior was we're had As year, pleased

So exceed. track matter. our from words those words on to We changed

will X.X we this the confident are We year. exceed

goal plan, Day. And fiscal year talk I Our at strategy. It's have we'll it like of at better third Investor winning we can at remains the our this that? But about that we is in XXXX, marketplace. than which do time three-year our X.X. more Do confidence

away pulling remarks, you chart I industry, anticipate the down. slowing look from our the see at can If don't the in that and prepared you

John Heinbockel

will When And XXXX revenue higher you as you think is call? thought about do to thought your ago, a and that think versus months maybe six margins just follow-up. you than six be quick too make it's now, now maybe or ago, months lower right, profit early

Aaron Alt

get We on guidance. we're in John, at our reaffirming opportunity believe to would the we because good like which now something back question very on our would what you long-term. May, and really morning. progress right? everywhere everywhere purposeful back see And It's can I Investor in And is is it, said your And we are was XXXX I is we at to about were Day time getting get seeing I going it getting at to for you, like take Omicron future. describe the through confident there. the the Aaron. XXXX, by the I quarter, stay are it, pleased the that focused the Sysco the we're with talking through we quite we volatility pieces in but And the the quite driven a focused I'm half, so the from I'm through by get right? Sysco. moment, we current through we're what and are business, all to Omicron. But in in perspective going getting we putting disciplined have to place upside,

John Heinbockel

you. Thank

Kevin Hourican

John. you, Thank

Operator

Truist Your from of line Bartlett Securities. next question Jake the comes of

Jake Bartlett

pushing your you last as look disruptions in And did we Anything for some My demand. that see Thank that wondering I'm your impact near-term of just that's for longer with at if you out first whether impacts in on maybe longer But and materially? impacts disruptions and of Omicron the chain supply instance, come taking here? there's kind sharply longer-term than Have your staffing a might independent there? closures, customers? the cases you Great. down question. any had any understanding was on view the the

Kevin Hourican

question. tied then investors' good a it's one is as minds directly I'll on point answer asked add believe I'm and to Jake, we going that to this.

First and this matters meaningfully. foremost, industry in scale

So, share Scale can purchasing from matters perspective. scale so matters customers. physicality so we with can get we best our possible a value costs

even anyone we to investments will than you our new the the strength to Aaron because shorter to dense centers Sysco, more to size, appropriate will from United over can a mile have and strong us of which than become incremental I make delivery. we balance as net States, generation last country see customer, cost flywheel route in and which serve. an our sheet, time lower cost facilities and breadth our continue delivery to increasing in invest put route, scale and capabilities believe capability primary ability the will distribution the to grow, the our physical else, that that closer have And serve others. lower a cash last-mile more is And of that of this comes company to means we the in So, we

increasing So, will we our an believe it strength formula be for company.

costs that want I labor Kevin, repeat that labor I'll about on clear our is, questions rate pressure just talking the this the that, be was in of we to One on rate wage QX. to believe is to immaterial up. going Labor experienced immaterial topic. about cost is the QX. wage worried in we minds Everyone you talked investors' is labor aren't we costs?

great to hiring typical is our the past people new it our tied the in if excuse single some cost tied of -- people to are was us that down for than that occurred to what operating wage to had past in me, industry this Our resignation. this thing the and more working call was there biggest summer that pressure you like percentage turnover quarter,

working the retention, productivity on associate feverishly are our of improving improving associates. we So, improvement training of our associates,

we As productivity competence. is our the up core are move what mentioned, will do, This is I confident we we ladder. this and

than said, takes because QX impactful time. that it be QX Aaron As more will

learning and relations locations mostly mentioned I that because course, of passenger customer Sysco restaurant is as company of started learning interface do. our in a driver gave also, color. in you which have When is of that up of face backing weeks, to drivers the driver this type the the a driving, I challenging you're earlier, decent piece our our standards, As learning seat company, for to

reduce is will that confident then begin to productivity, we time, through improved margin. we our which why investments those making So flow we're EBIT over are which will improve will to percent

be something rate So not I causing cost that just is labor our clear, pressure. current operating increase want is to

we wage We to look annual to when deserve hard. future, will provided we have process rate those types we appropriately, offset can the do paid associates. do As anticipate improvement that and be of you efforts They review nominally our They have change? our increase that fairly and help work will a to that higher productivity increases.

Jake Bartlett

really I'm Sysco? left it’s increase could And that's, Brinker, or something change people to rehire rehiring quick are -- mean, just labor as And whatever sign week, that rates wondering, whether a also that. great. a you productivity. any something might just coming really seeing that much. you reason I the about seeing back follow-up improving employees. interest measuring Great, you're there in I former for an help an of in that's Last very of with to market, Thank but material Is think, and talked have

Kevin Hourican

it's Jake, a great Yes, question.

a said quarters furloughed of chain in I XXX% think March we've of supply we perspective. ago, rehired from a back I people couple that

now been open business fully and we're time, for we've long So a for growing.

winning taking customers. market So we're share. new We're

well XXXX. above are obviously sales Our

the above XXXX Our future. volumes, we anticipate will be back not-too-distant in to and then

shingle there. got hire we've to open the So out

getting for more we're open recruiting fact, effective positions. In at much

team more getting this to the higher to Our target your going why on we from driver and to how answer demands getting hiring people But better have Jake, meet better future, we industry, at question, have. applicants, academy. in to we're and actually them. that It's to is formed the needs training marketing sophisticated specifically and go outside to we're our

academy driver live Just bit now of physical little in two a on that. locations. color We're

graduated work Our trade, have to have first driver class them train to we people eat them and to CDL has find intended, class to we're our from pun we're aren't teach going them for drivers, who and CDL going where today to our cooking, have to academy We participate you own average an enter think driver wanting driver people that's you of you have school. were long pay school, if to today, for and Sysco. a that a pay scale program; time matter. again, And in example an driver size become the to and actually whereas person then

from the having to having to across we lose and So to from to actually flip, attend expanding pay that questions. that about to think and Driver pay about for Thank working, the opportunity time you that and Academy, we're country. attend Sysco go, bullish you the

Jake Bartlett

you. Thank

Operator

of line comes Jeffrey question of the Your Barclays. next Bernstein from

Jeffrey Bernstein

just very I talk you much. in on whether the we've some starting trends. Or reference both start sales some because to which was that you better? heard more Thank bit maybe about believe whether to side to Aaron, more maybe, just seen recover, to you're easier earlier, trying I'm I I early do more referring about and assess shoots. know starting to Kevin spot mentioned Great. getting we've are prices think recent little February green February that's sequentially hiring. to things as and commodities inflation, talked on we've in maybe ease mid-January a --

to just first green you the trying So the about what shoots quarter. comes as assess third through talk think you fiscal

Kevin Hourican

beginning what case Thanks actually tied tied therefore, and improve. made volume, green excuse That's for the was to to I was Jeff. to. sales that question. comment comment shoot The that morning, cases me, -- Good

literally XX% area, like just month in you a begin closed which in January. Toronto to restaurant restrictions has Greater They for relaxed. province, the couldn't Canada. a in As but onerous have on-prem February were Quebec is restriction in restaurants very the place, was Canada in GTA, of it ease, still eat a dining, In

those to restrictions the The So We're as can And volume. well. a a commentary. ease United The and then two, the this where continues But QX. from? sales north, didn't and the putting that the comment Point ease. see to one-third again, US, expenses, shoot States in in restrictions very perform those restrictions plan. city began expect of Southern restrictions and mostly volume ease, as of progress certainly in a France, and do progress those customers anticipate I that's have return So they're we the being restrictions green that the seeing will urban to was the UK we mayor on decision environments operating as, is the tied QX these been of we give a we recovery have the mandatory make else there -- into and -- in in recovery business restrictions the made centers and headwind come US In very color easing. work-from-home. in heavy, in

address have management to cover our who’ll to plan. five-part Aaron, three two. quickly, expenses. a plan toss We I'll action I'll operating It's and a cover then

curve, Golden hires There's we new training retention, focused productivity about move improving hire optimally. that First are transportation routed efficiency. It's do. that most work to pick shovel efficiency and level. work productivity. need productivity. ensure are the We two and the and trucks new Nam can transportation we being maniacally is foremost to the is There's it’s say Topic like to we highest that our and up Hills, at operating ensuring on the on

The in that Sysco from came today's question third Alex. The brand. is conversation earlier up

focus brand. addressing. profit tied to two topics making in then in It be toss go to Sysco and other year you. big over improvement are brand. progress the we're penetration in of the for increasing go, anticipate I'll will We Sysco to the Aaron a year to Aaron, to And we

Aaron Alt

importance equal Thanks, COGS. progress are against our Kevin. Of

to opportunities better. have source We

over we're new us finding steam, efforts strategic being efforts take time. sourcing and will and that and are frankly, accelerating projects. then, relentless on bullish on Our course, And out gathering of cost where our

goal May. from big there We out have a

what hearing the those that accelerating talk low largely want help And a of green clarification. absence of I is point those out who point that cross just trying are do right? We to the models to to experiencing the their us modeling February are are January offset working I want seasonal in green goal, and so while coming in you're last for couple about been us to beyond. in forward out shoot Omicron, bring shoots, us, to even quarters. we've the one for over goodness

Jeffrey Bernstein

investments my then know in fiscal And ease seemingly for profitability that referenced half initiatives follow-up, just the improves guys relates made. I Understood. to improving a that number you here, finally of as guess, we're quarters second a I starting guess, I you front. have little point on profitability which now, XXXX, bit, of profitability

you intact or see whether you wondering thesis reiterated whether still XXXX. there's Obviously, the fiscal delays that Just been to that.

like there's believe to lot you back going put a end the but start bear the really or that half is variant. XXXX, the kind in fruit still of whether Omicron So it still of seems fiscal recovery type initiatives spot, to there's putting wondering of concern same zone are place whether stick at a of starting just you aside the hockey the that more a in

Kevin Hourican

appreciate I question. the

And we while doing. to some box environment we're things fiscal of by are Let got visibility environment end right? working perspective. have changed the are has operating. the do, so on which we we efforts, in me early Everything aggressive in operating, which of the sourcing GP impacted on we're those offer out is and the of the at we going right? What P&L XXXX, working The cost-out efforts in has been said

our guidance. do have in long-term strong confidence we So

profit visibility those. aren't away the aren't anything, actions that internally actually And If they're recovery down. we efforts from backing those we slowing accelerating. have gross had We and And actions. on out planned cost take to to

on XXXX. management So and or back environment 'XX back all-time means what at going fiscal earlier we're comments fiscal us. while, locked and team you I'm guidance to my high I about the Kevin and half being above our going to entire for the from of hands, to EPS and refer deliver short-term the are

Jeffrey Bernstein

Understood.

Operator

John of of Stanley. Your next Glass from Morgan the question comes line

John Glass

staffing growth. base have back looking more Is say impacted overall growing I Broadline case of growth things and in Thanks the to that of local terms etcetera? or wanted you're it in environment between your negatively that, customer the negative shortages, restaurants to health? your there concern is this any case restaurants very fair like about reads your any to And not? been go independent difference you there inside impacting health mentioned and much. at of Is by independent is inflationary their seeing viability financial that the inflation

Kevin Hourican

question. a that's John, really terrific

you COVID. this In in purchase indexes to QSR ease of to a meaningful segment reportable winners our last part of payment, the customer food sophisticated that chains Year that really obviously allows type. the and because and allows towards are go had could paperless, have back If that year, I winner. COVID, one for top SYGMA we the SYGMA go digital just me drive-through SYGMA of That share of see app back health beginning to go component. loyalty. restaurant just big that fast And bottom two a serving in was that customer the line. record contactless both ordering, line COVID, year Let meant frictionless year of

them at Those select fantastic pretty One come restaurants at won't me, loyalty that and winners big to more excuse I in their are there names of program working them time. retailers to the personalization. this the -- often. are that the Well, we're customers more is back prompt Sysco of restaurants, from on their are name buy things point

of sweet venue a and with delivery restaurant. a and we their also, figure of This the version We helping help connect mobile it to and how help and spot out that we out so payment contactless we're the up As like them is of with who partner. them pick independent take a to are? shop Sysco are in remotely things how to creation can customers helping we pop. restaurants, relates can the or So mom

about time. that we and They And loyalty over to larger weren't force mom-and-pops are And in the slide that indices is effectively of in don't buying They now to they steadily. with refer Sysco's deck the buying both of Sysco just just earn of percentage that some will from consult us from increase believe percentage We stickiness. us improving food. you will industry, literally that more do. what the Sysco compete then our those customers sales talked I that previously the back them have companies. customers with largest So to sell in and the of we chart believe the help

independents. the in help not going of believe many succeed. Sysco. partner out confident with them the And there, them we're long There we are So mom-and-pop and customers we the to independent that can of that mom-and-pop term Sysco's outperform does are

data But got their our impact the use inflation would and selling would more shows yes, call negatively that scales mom-and-pops. fact, but that's what back pricing are. we've and national that Sysco that, I Point that. mitigating in have we chain it thesis. the And inflation to process. supplier the perhaps reps I the have is In to does sales why say them with has more long-term of case two, of Many buffering? contracts fact, then fixed in mom-and-pop well less is and/or tied

essentially their agent. We are purchasing

back mentioned are this questions We on from are is we earlier inflation hard pushing I what component. of increases, the as John, cost one doing the about other, in

we've money the could which that alternative to find us got good for it is suppliers, help saves brand We making happening again, includes customers Sysco to are and a at motivates Sysco saves items and as restaurant that's working to mom-and-pop. regard fact items, anticipate alternative what things well. lot too. cost love substituted that them mom-pop with them Brand aggressively And lower and of Sysco their in we be that serve that time inflation, them our progress And

John Glass

into then Do of think peak the the quarter as the see inflation the you're And off, quarter? you third that. inflation of you not inflation the here for was comment, Thanks just cool that you do second yet? or do look begins think to on you in what on rate seeing

Aaron Alt

point elevated We the impossible would to us as inflation. much of will as And see do. down levels I like to are for to be when call continuing

elevated the QX fiscal down through so the And inflation are year, if assuming of in rest we versus QX. modestly

John Glass

Thank you.

Aaron Alt

John. Thanks,

Operator

question next Carden the line of UBS. from comes Mark of Your

Mark Carden

lot my morning. taking for Thanks a questions. Good

the too front? disruption guys the not local as doors These So that against increase an doors ago, overall noted XX% still a of local hold much largely XX% long decline open. this Thanks. impact variant served in on numbers you've had you in seen true

Kevin Hourican

Yes, Mark, it's true. holding

this to to we continuing reported is, it we're holding progress. make pivoted We it's of answer fact, in true. yes, question The So kind on quarter. how your

you even unique prepared remarks and This quarter, color buy shows the more our us putting of from going to buying provide then we chose going the percentage not down. you from chart a that percent up do customers us by in

recovery I at tunnel think still an than operators, end and industry prepared benefit what and many rate mom-and-pop You doors serving be customers light they resulting up. two the had to number And go a of would I predicted. independent of unique put in us. lower to they're of And the it's together, those from in continues we're say the that's bankruptcy of the that see continues to front

Mark Carden

Omicron labor of of restrictions continued the from and to has in pressures in industry either Okay. the smaller Great. and thinking about sense distributors US in competitive perspective, the then their impacted And internationally wave or as independent landscape combination another stay there? of distribution more ability impacted thinking food the the business the

Kevin Hourican

talking one -- this, that agility even important I back healthcare Economic I that which question. of and previous resiliency now about Supply in topic. what things like is resiliency chain and newest to the of about, weather can CEO the is about you the and environment. questions, to people our which like environmental COVID Forum and call would political of is you have places talking answer Hey, this matter then are chain supply it supply Mark, a conditions, used chain storms unrest buzzword to be tied if more just World think size become scale my appreciate is kind and

scale supply size talking matter and you're chain resiliency. So when meaningfully

to have able recover. the ensure did customers time as we to they be invested have inventory hand we inventory the that I We and on our Aaron support to than pre-COVID. present more at have

we labor, operating way, earlier, we're statement to some and able I but be customers win hiring new forever. it intentional. sheet in will it position We of to aren't In our balance of midst that. our a that ours as keep strong and and is while proper and through, They're to also investing thousands less us impacted expenses QX, Omicron to And mentioned on income people, yes, business. that's holding do competitors intend get to in business, in in serve able our are

So, those are our ambitions.

size digital We are ability and confident so. to Last comment yes, in for to our Aaron. before is toss scale and matter. do I me

transformation our our One is investments to of improve capabilities. digital

pricing of success tool, visit. on at with is the restaurant penetrating Salesforce call lines literally software, which business existing rate to that substantial which on we XXX, job our tool, new guiding We've to and made consultant customers. that given the new improvements winning made So, to sales We've what that our have to cases our website. sales substantial increased guides which improvements sales substantial be modern improvements rep force done on

on capabilities, of compete which we as distance types today, million types in call investments, quoted those with. immaterial, those additional we're So, Cost, that not going investments to comments. from Aaron, of those $XX are ourselves Aaron worth for the of

Aaron Alt

Kevin, doing need our guidance to it I will that meet of and right for why to part or we XXXX. now, in by for exceed the investing the but they customer going this profit, is while confident just things when on are the right? the customer earlier which one to this algorithm build want long-term be to the willing long-term, the to an we're and us ecosystem support is we're of we Short-term, back impact because ladder answers, have our is guidance

Mark Carden

much so Thanks Great. guys.

Aaron Alt

Mark. you, Thank

Operator

comes question of of Suisse. next from Silberman Lauren Your Credit the line

Lauren Silberman

the for you Thank question.

first, million to understand be costs. fall the snapback carry to of Just follow XXXX think structural. transformation $XX $XX really XXXX snapbacks of the cost in full and the base? fiscal of and transformation million about the to second these trying of the base? on Just we fiscal much the up quarter off see sort going costs forward costs in of how How to are to in Should

Aaron Alt

question. Great Sure.

get aside I observations. We're half long-term important going guidance. so of qualifier to to through with of XXXX haven't do So, course, couple of provided so going the That guidance, the work we're going back then you to fiscal today. I'm not this towards a and year

The first they're is that nature. the in transitory, snapback costs we're out, calling short term onetime are

our our said And current long-term and to so wage are or results. term expect do we to I want those -- increase want not our increases emphasize to emphasize be structure. emphasize I And when even structure, capital I to to increases is immaterial which Kevin earlier, something rate medium cost

Important we at caveat, the will OpEx not where and and will in -- investments, though, what transformation the I structural we say continue guidance don't transformation With the be to is again -- include transformation in get when the transformation assumed clarity me it that looks more to XXXX guidance. continue in half, changes, our our let against investments were speak. will on do there's -- so we provide a we to And that our they we'll like think in those QX. respect to I've XXXX above back or in invest -- to now, invest before, so said

Lauren Silberman

about the dynamics understand the permanent. product to are double-digit talk line managing are topline? Okay. seeing pricing And hitting Just through transitory, talked you've the you're cost OpEx elevated know costs. about price on inflation, the between pushing to inflation you the that opportunities some effectively recoup separately, some inflation. versus the I then some power trying Can of

more inflation So, just assume can U.S. we the pricing clearly, were in XX.X% said broadline? above you

Aaron Alt

indeed a our have able -- the as stable, far regular we of right? case math, in, and -- we it's environment going up, would go, we we our inflation pass much imply how through dollars costs in that of context cost the we're through be is where how because far are gross the to a basis. As on as if if make up, passed product far as as cost our choice to Great manage per question. we The wasn't that would profit weren't we operating

and right the we thing the committed that? anything in to Kevin, doing on We to the supporting focus environment to are you long-term customers add the as guidance. short-term want

Kevin Hourican

Yes.

might to them types our the to transaction how really a something is thing our obvious Lauren. There food costs. is of that one purchase be customer Just certain company. purely be food with through It question, on outside the much the want are I good add. not and clear where

well. regard a So doing in for Aaron good customer we're And that just type. described that very job that

are basis. other we provisions for also fee contracts We from times -- that increases, are we but we operating on aggressively cost they most working when per customers our the it's where And did recent case pinched. food in get And quarter, there increase, transact those cost in that's that. that have are like a

that those we so And we also, of segment. SYGMA is excuse we the -- the fairness have are the in plan me, in our to I improve contracts long-term that fee-per-case meaningfully within arrangements, the a our fact, in work customers reporting most that that have that operating as recent the earlier. improving. to reasons SYGMA sector We've cost increased SYGMA staffing productivity looking quarter our described with at in reporting In partnership segment, we types got tied with SYGMA, and same

some our if management where that ago. So actually relationship case, and yes, a I And partnership, long-term hope price, customers with it's conversation gives can we you color I described. referenced do it's item a that what deeper a you it's that second

Lauren Silberman

Thank you, guys, very much.

Kevin Hourican

Thank you, Lauren.

Operator

next of Bank. line question Brian Your Deutsche from the Mullan comes of

Brian Mullan

Thank you. Hey.

of update XXXX non-restaurant provide you stands the if for fiscal relative wondering business. sectors in U.S. present to volume Just level where the of at might some the the recovery an

remarks. about If prepared referenced just as in business industry care. you Kevin, you hospitality talk health the well could and and

of a Just when for to we sense looking to magnitude, go much normal. how terms back in get is of there

Kevin Hourican

Brian, at this bit little terrific a hinted question. I ago. Yes,

it say We're primary are that but leading I'll and to two down space. still in meaningfully business a we're the percentage, food and not provider sectors down that's industry, quote going have We that meaningfully. and

catering partner with primary the and companies we foodservice and we companies, are rest. for the offices, So management those to distributor

from sector did in, from trying really down stopped home. is occur. back do have that, but year go we to it’d January, when meaningfully. thought. in currently to progress to than going being actually So predict in not Most But companies that to are sector that we slower go, kick had be working anticipated Most working to and companies still made they’re the still office. that We the anticipate going was progress

of significantly. a in currently the large are hospitality be we travel leisure strong prepared travel We very performed Sysco. remarks. will very the optimist summer still travel to like industry. and a inclusive flat longer-term on well hospitality. Again, volume this performance business And second to Leisure is, and drives XXXX summer. delayed that last recovered of business getting at also trends a into player we we'd it's space. down quite what portion in in business of we've tailwinds and kind Business further well additional view, anticipate current But isn't big tailwind because be of will very business travel But for travel and the future. said a of And Omicron, front that have fuel meaningfully On be our summer. and Aaron said the us his as the is us yet, got travel that and that that conferences tailwind

Brian Mullan

done there what for if just then benefits widespread any some program able learnings talk restaurant you're you this as you right? And US. follow-up, might of program? loyalty terms envisioning longer a the you. be at discuss then you and What in question the want, level, about then in of a getting you the are conversely, of adoption? the a Thank Okay. And driving customer to on could are Are way the some high term the it get pilots what challenges early

Kevin Hourican

love know that now that's a of progress happening personalization. Brian, Today, data that's them, for even chose it. are those remarks that's making elements artificial technology the going customer focus against growth. And to data. that up keep when troves way the that five data my one in on prepared I of to personalization. intelligence great and got customer And is offers sure, service are offer progress meaningful happening. and for that. to now assure one, I we purchasing mean, we've Treasure can we're almost unique doing shop food cloud. and patterns purchasing and machine I our with of cuisine, Sysco, that I short, specific data behavior Hey, starts end about on distributor Sysco only our in provide We've and And recipe question. them. brilliant we're It And you unique customers learning say all your got platform. of an but Italian getting offers through for just to each the it's is that doesn't what's showing with

experts a rep chefs. activation, These restaurant you're specifically Main best in sales though, are & from point, second them, the into is Street, they These briefly former as are hey, The and Bar us. they buying owners. our got mentioned though Grill heading this the on sales moment which I what ago. been We're the up are now We've trained haven't is industry, team teeing food. for in

of which a being just enable through selling to increase offer existing penetration sample you to for but be to an going profitability money. is that a Sysco that that shop, data truck. customers, customer to brand win also to talk distributor them specific to way sales the There's going our the reps to us, you the business. to provided and best for also the with it's improve only a power next today that about. Here's us like it's will for There's can Sysco on new customer opportunity save And

now people your to item are adoption to As even pricing come In that future to That's and being I'm an pilot. for loyalty at to than someone able to first future, that's expansion you from enrolling begun good for well, they level give ordering is one. pilot have a we provide shop talk going about us. a the our it a that called Tied loyalty and question, the update prepared to relates plans will before Sysco not customer Sysco. is into program the That Sysco of other endeavor today, that at more we an program. It's Perks. actual on the update on very

Brian Mullan

you. Thank

Kevin Hourican

Brian. you Thank

Operator

of line of question the Bania Capital. comes BMO from next Kelly Your

Kelly Bania

us for Thanks in. from to pressures. Hi, good morning. illness on aside question the about another staffing ask hiring near-term fitting related just Wanted

do to that need And you hiring level more the about the much talk And of of just the by of find? to able quantification year? you rate talent end how can curious Just wage fiscal any you're figure.

front noted would we but was mid-single Any material, talking that single low think be I not it as digit? are helpful. on help digit,

Kevin Hourican

provided he We're to provided. going not do hiring to going not something Aaron I that Kelly, that ago thanks. just we're you an number. year quote a That's outlook, the outlook here. reference to

As it but that's We compelling we're drivers will are of and types talk relates not it's routes were material them that to with be expense working our productivity. got piece to on their an to not long-term be be that as things material equipment that our concerning is our should the it driver wage managing pressure, of manageable we're amount summer on to that about. norm, We've in this their the our and ecosystem. to are that we We're handling projects a we that do elevated help clear use versus talking days, actually that about purchasing it equipping pretty those anticipate will improve algorithm. something today relates

being that expense So the quarter wage most in pressure described increase not are things again, material. recent our we've the with we that experienced

Kelly Bania

a of talked this Kevin, But then, about And the terms the business. investors I bit enough. Okay. really how negotiation in just the of are little side guess, moving being process going? at those just cost and contract is contracts competitive general, is you're kind forward. as And in the if factored of wondering Fair for environment how, you into contract contracts the resigning all, and

Kevin Hourican

key have are keep full. would a have. private the relationship it's tied our contract size, even our in to we us customers we to appreciated going and I'm our and ability to we good the and between discussions Kelly, that than question. But before really And obviously, say scale, and suppliers, time ever that I on ship more it's the now following: negotiations

that ship There has means You not going is the fair as at we are to probably scarcity can we're right long-term going ship a more lack that.' vis-à-vis relationships. language, look business contracts now. contracting now but we because 'take appreciated now of But we're full There not and before. balanced on partnerships of supply. Sysco time and than is Hopefully, market clear. a infer That's with appreciated the capacity of than to who with, was And more on and we people do even and ever before. that advantage in are we company have a ever what

Kelly Bania

Thank you.

Kevin Hourican

you. Thank question. Appreciate the

Operator

This Thank you Thank participating. for you. conference concludes call. today's

You may now disconnect.

Sysco (SYY) 8 Feb 222022 Q2 Earnings call transcript