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Sysco's (SYY) Q3 Earnings Lag Estimates, Sales Advance Y/Y
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Sysco Corporation (SYY - Free Report) posted third-quarter fiscal 2023 results, wherein the top and bottom lines grew year over year and the former beat the Zacks Consensus Estimate. The company saw a double-digit rise in earnings and sales, continued market share gains, solid progress in the Recipe for Growth plan and supply-chain efficiency.
Quarter in Detail
Sysco’s adjusted earnings of 90 cents per share fell short of the Zacks Consensus Estimate of 92 cents. However, the bottom line rose 26.8% from the year-ago period figure.
Sysco Corporation Price, Consensus and EPS Surprise
The global food product maker and distributor reported sales of $18,875.7 million, which jumped 11.7% year over year and cruised past the Zacks Consensus Estimate of $18,725 million. Foreign currency had an adverse impact of 1.2% on the top line.
The adjusted gross profit jumped 12.8% to $3,431.4 million, and the adjusted gross margin expanded 18 basis points (bps) to 18.2%. This year-over-year growth in the gross profit was fueled by elevated volumes, efficient inflation management and progress in the company’s partnership growth management efforts.
SYY witnessed product cost inflation of 4.9%, which was measured by estimated changes in product costs, mainly in the dairy and frozen categories. Foreign currency had a negative impact of 1.3% on the gross profit.
Adjusted operating expenses rose 9.3%. The adjusted operating income of $735.5 million grew 27.8% from the year-ago period.
Segment Details
U.S. Foodservice Operations: In the reported quarter, the segment witnessed robust sales and volume growth, overall share gains and higher profitability. Sales jumped 10.4% to $13,257.5 million. Local case volumes within U.S. Broadline operations rose 4.2%, and total case volumes increased 6.1%.
International Foodservice Operations: The segment’s sales advanced 18% to $3,344.1 million in the quarter. However, foreign-exchange fluctuations adversely impacted the segment’s sales by 7.3%. On a constant-currency (cc) basis, sales advanced 25.3%.
SYGMA’s sales advanced 9.9% to $1,972.1 million.
Meanwhile, the Other segment’s sales jumped 13.1% to almost $302 million.
Other Updates
Sysco ended the quarter with cash and cash equivalents of $757.9 million, long-term debt of $10,258.3 million and total shareholders’ equity of $1,575.3 million. In the first 39 weeks of fiscal 2023, the company generated cash flow from operations of $1,425.8 million, and free cash flow amounted to $979.6 million.
During the first 39 weeks, Sysco returned $1.1 billion to shareholders through share buybacks worth $377.8 million and dividends of $747.4 million.
Shares of this Zacks Rank #3 (Hold) company have dropped 5.4% in the past six months against the industry’s growth of 8.3%.
Lamb Weston, which operates as a frozen potato product company, currently sports a Zacks Rank #1 (Strong Buy). LW has a trailing four-quarter earnings surprise of 47.6%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Lamb Weston’s current fiscal-year EPS suggests an increase of 116.8% from the year-ago reported number.
Post Holdings, a consumer-packaged goods holding company, currently has a Zacks Rank #2 (Buy). POST has a trailing four-quarter earnings surprise of 34.8%, on average.
The Zacks Consensus Estimate for Post Holdings’ current fiscal-year sales and earnings suggests growth of 2.2% and 112.5%, respectively, from the corresponding year-ago reported figures.
Conagra Brands, which operates as a consumer-packaged goods food company, currently carries a Zacks Rank #2. CAG has a trailing four-quarter earnings surprise of 13.2%, on average.
The Zacks Consensus Estimate for Conagra Brands’ current fiscal-year sales and earnings suggests an increase of 7.1% and 16.5%, respectively, from the year-ago reported number.
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Sysco's (SYY) Q3 Earnings Lag Estimates, Sales Advance Y/Y
Sysco Corporation (SYY - Free Report) posted third-quarter fiscal 2023 results, wherein the top and bottom lines grew year over year and the former beat the Zacks Consensus Estimate. The company saw a double-digit rise in earnings and sales, continued market share gains, solid progress in the Recipe for Growth plan and supply-chain efficiency.
Quarter in Detail
Sysco’s adjusted earnings of 90 cents per share fell short of the Zacks Consensus Estimate of 92 cents. However, the bottom line rose 26.8% from the year-ago period figure.
Sysco Corporation Price, Consensus and EPS Surprise
Sysco Corporation price-consensus-eps-surprise-chart | Sysco Corporation Quote
The global food product maker and distributor reported sales of $18,875.7 million, which jumped 11.7% year over year and cruised past the Zacks Consensus Estimate of $18,725 million. Foreign currency had an adverse impact of 1.2% on the top line.
The adjusted gross profit jumped 12.8% to $3,431.4 million, and the adjusted gross margin expanded 18 basis points (bps) to 18.2%. This year-over-year growth in the gross profit was fueled by elevated volumes, efficient inflation management and progress in the company’s partnership growth management efforts.
SYY witnessed product cost inflation of 4.9%, which was measured by estimated changes in product costs, mainly in the dairy and frozen categories. Foreign currency had a negative impact of 1.3% on the gross profit.
Adjusted operating expenses rose 9.3%. The adjusted operating income of $735.5 million grew 27.8% from the year-ago period.
Segment Details
U.S. Foodservice Operations: In the reported quarter, the segment witnessed robust sales and volume growth, overall share gains and higher profitability. Sales jumped 10.4% to $13,257.5 million. Local case volumes within U.S. Broadline operations rose 4.2%, and total case volumes increased 6.1%.
International Foodservice Operations: The segment’s sales advanced 18% to $3,344.1 million in the quarter. However, foreign-exchange fluctuations adversely impacted the segment’s sales by 7.3%. On a constant-currency (cc) basis, sales advanced 25.3%.
SYGMA’s sales advanced 9.9% to $1,972.1 million.
Meanwhile, the Other segment’s sales jumped 13.1% to almost $302 million.
Other Updates
Sysco ended the quarter with cash and cash equivalents of $757.9 million, long-term debt of $10,258.3 million and total shareholders’ equity of $1,575.3 million. In the first 39 weeks of fiscal 2023, the company generated cash flow from operations of $1,425.8 million, and free cash flow amounted to $979.6 million.
During the first 39 weeks, Sysco returned $1.1 billion to shareholders through share buybacks worth $377.8 million and dividends of $747.4 million.
Shares of this Zacks Rank #3 (Hold) company have dropped 5.4% in the past six months against the industry’s growth of 8.3%.
Solid Consumer Staple Picks
Some better-ranked consumer staple stocks are Lamb Weston (LW - Free Report) , Post Holdings (POST - Free Report) and Conagra Brands (CAG - Free Report) .
Lamb Weston, which operates as a frozen potato product company, currently sports a Zacks Rank #1 (Strong Buy). LW has a trailing four-quarter earnings surprise of 47.6%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Lamb Weston’s current fiscal-year EPS suggests an increase of 116.8% from the year-ago reported number.
Post Holdings, a consumer-packaged goods holding company, currently has a Zacks Rank #2 (Buy). POST has a trailing four-quarter earnings surprise of 34.8%, on average.
The Zacks Consensus Estimate for Post Holdings’ current fiscal-year sales and earnings suggests growth of 2.2% and 112.5%, respectively, from the corresponding year-ago reported figures.
Conagra Brands, which operates as a consumer-packaged goods food company, currently carries a Zacks Rank #2. CAG has a trailing four-quarter earnings surprise of 13.2%, on average.
The Zacks Consensus Estimate for Conagra Brands’ current fiscal-year sales and earnings suggests an increase of 7.1% and 16.5%, respectively, from the year-ago reported number.