Sysco Corporation (NYSE:SYY) saw its stocks fall sharply Monday morning, on second-quarter financial numbers.
Sales for the second quarter were $10.4 billion, an increase of 3.2% compared to the same period last year. Local case volume within U.S. Broadline operations grew 3.7% for the second quarter, of which 2.5% was organic, while total case volume within U.S. Broadline operations grew 2.0%, of which 1.3% was organic.
Gross profit increased 2.4% to $2.0 billion, and gross margin decreased 17 basis points to 19.7%, compared to the same period last year. Food cost inflation was 2.6% in U.S. Broadline, as measured by the estimated change in Sysco’s product costs, primarily in the dairy and meat categories.
Operating expenses increased $15.8 million, or 1.2%, compared to the same period last year. Adjusted operating expenses increased $12.1 million, or 1.0%.
Operating income was $768.8 million, an increase of $31.3 million, or 4.2%, compared to the same period last year. Adjusted operating income was $772.5 million, an increase of $35.0 million, or 4.7%, compared to the same period last year.
Said Chief Financial Officer Joel Grade, "Our second quarter fiscal 2020 results were driven by improved local case growth in our U.S. Foodservice segment, particularly within our independent customers.
"While our adjusted earnings per share were in-line with expectations for the quarter, our operating income results fell short. We remain focused on executing against all of our strategic initiatives to strengthen our long-term performance while maintaining our focus on the customer."
SYY shares fell $3.73, or 4.5%, to $78.41.
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