<PAGE> 1
===================================================================
Page 1 of 19
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended October 2, 1999
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission file number 1-6544
SYSCO CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 74-1648137
(State or other (IRS employer
jurisdiction of identification
incorporation or number)
organization)
1390 Enclave Parkway
Houston, Texas 77077-2099
(Address of principal executive offices)
(Zip code)
Registrant's telephone number, including area code: (281)
584-1390
Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of
the Securities Exchange Act of 1934 during the preceding 12
months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
Yes X No
329,380,117 shares of common stock were outstanding as of October
29, 1999.
==================================================================
<PAGE> 2
-2-
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
The following consolidated financial statements have been
prepared by the Company, without audit, with the exception
of the July 3, 1999, consolidated balance sheet which was
taken from the audited financial statements included in
the Company's Fiscal 1999 Annual Report on Form 10-K. The
financial statements include consolidated balance sheets,
consolidated results of operations and consolidated cash
flows. In the opinion of management, all adjustments,
which consist of normal recurring adjustments, necessary
to present fairly the financial position, results of
operations and cash flows for all periods presented, have
been made.
These financial statements should be read in conjunction
with the audited financial statements and notes thereto
included in the Company's Fiscal 1999 Annual Report on
Form 10-K.
A review of the financial information herein has been made
by Arthur Andersen LLP, independent public accountants, in
accordance with established professional standards and
procedures for such a review. A letter from Arthur
Andersen LLP concerning their review is included as
Exhibit 15.
<PAGE> 3
-3-
SYSCO CORPORATION and its Consolidated Subsidiaries
CONSOLIDATED BALANCE SHEETS
(In Thousands Except for Share Data)
<TABLE>
<CAPTION>
Oct. 2, July 3, Sept. 26,
1999 1999 1998
----------- ------------ ------------
(Unaudited) (Audited) (Unaudited)
<S> <C> <C> <C>
ASSETS
Current assets
Cash $ 143,831 $ 149,303 $ 108,264
Accounts and notes receivable,
less allowances of $29,567,
$21,095 and $27,609 1,450,881 1,334,371 1,313,797
Inventories 910,746 851,965 853,064
Deferred taxes 35,789 43,353 37,098
Prepaid expenses 34,283 29,775 28,892
----------- ---------- -----------
Total current assets 2,575,530 2,408,767 2,341,115
Plant and equipment at cost,
less depreciation 1,245,926 1,227,669 1,157,86
Other assets
Goodwill and intangibles,
less amortization 402,364 302,100 309,322
Other 175,170 158,046 152,769
----------- ----------- -----------
Total other assets 577,534 460,146 462,091
----------- ----------- -----------
Total assets $ 4,398,990 $ 4,096,582 $ 3,961,066
=========== =========== ===========
LIABILITIES AND SHAREHOLDERS'
EQUITY
Current liabilities
Notes payable $ 139,027 $ 13,377 $ 13,770
Accounts payable 1,090,708 1,013,302 1,003,878
Accrued expenses 390,271 374,271 272,096
Accrued income taxes 33,407 6,103 59,581
Current maturities of
long-term debt 19,773 20,487 115,412
----------- ----------- -----------
Total current liabilities 1,673,186 1,427,540 1,464,737
Long-term debt 1,055,168 997,717 873,057
Deferred taxes 234,735 244,129 228,829
Shareholders' equity
Preferred stock, par value
$1 per share
Authorized 1,500,000 shares,
issued none --- --- ---
Common stock, par value
$1 per share
Authorized 500,000,000
shares, issued 382,587,450
shares 382,587 382,587 382,587
Paid-in capital 35,221 872 2,271
Retained earnings 2,096,731 2,032,068 1,852,758
----------- ----------- -----------
2,514,539 2,415,527 2,237,616
Less cost of treasury stock,
53,267,646, 52,915,065
and 48,257,269 shares 1,078,638 988,331 843,173
----------- ----------- -----------
Total shareholders' equity 1,435,901 1,427,196 1,394,443
----------- ----------- -----------
Total liabilities and
shareholders' equity $ 4,398,990 $ 4,096,582 $ 3,961,066
=========== =========== ===========
</TABLE>
Note: The July 3, 1999 balance sheet has been taken from the
audited financial statements at that date.
<PAGE> 4
-4-
SYSCO CORPORATION and its Consolidated Subsidiaries
CONSOLIDATED RESULTS OF OPERATIONS (Unaudited)
(In Thousands Except for Share Data)
<TABLE>
<CAPTION>
13 - Week Period Ended
-------------------------------
Oct. 2, 1999 Sept. 26, 1998
------------ --------------
<S> <C> <C>
Sales $ 4,657,034 $ 4,192,630
Costs and expenses
Cost of sales 3,793,200 3,426,045
Operating expenses 674,244 607,812
Interest expense 17,944 16,931
Other, net (189) 170
------------ ------------
Total costs and expenses 4,485,199 4,050,958
------------ ------------
Earnings before income taxes 171,835 141,672
Income taxes 66,156 55,252
------------ ------------
Earnings before cumulative effect
of accounting change 105,679 86,420
Cumulative effect of accounting change (8,041) ---
------------ ------------
Net earnings $ 97,638 $ 86,420
============ ============
Earnings before accounting change:
Basic earnings per share $ 0.32 $ 0.26
============ ============
Diluted earnings per share $ 0.32 $ 0.26
============ ============
Cumulative effect of accounting
change:
Basic earnings per share $ (0.02) $ ---
============ ============
Diluted earnings per share $ (0.02) $ ---
============ ============
Net earnings:
Basic earnings per share $ 0.30 $ 0.26
============ =============
Diluted earnings per share $ 0.29 $ 0.26
============ =============
Average shares outstanding 328,925,219 334,849,272
============ =============
Diluted average shares outstanding 333,487,155 338,184,255
============ =============
Dividends paid per common share $ 0.10 $ 0.09
============ =============
</TABLE>
<PAGE> 5
-5-
SYSCO CORPORATION and its Consolidated Subsidiaries
CONSOLIDATED CASH FLOWS (Unaudited)
(In Thousands)
<TABLE>
<CAPTION>
13 - Week Period Ended
-------------------------------
Oct. 2, 1999 Sept. 26, 1998
------------ --------------
<S> <C> <C>
Cash flows from operating activities:
Net earnings $ 97,638 $ 86,420
Add non-cash items:
Cumulative effect of accounting change 8,041 ---
Depreciation and amortization 52,908 47,983
Deferred tax benefit (1,596) (3,389)
Provision for losses on accounts 5,979 5,688
receivable
Additional investment in certain
assets and liabilities, net
of effect of businesses acquired:
(Increase) in receivables (94,941) (103,875)
(Increase) in inventories (45,907) (62,563)
(Increase) in prepaid expenses (4,169) (2,297)
Increase in accounts payable 62,435 154,719
Increase (decrease) in accrued
expenses 13,159 (20,159)
Increase in accrued income taxes 31,747 34,058
(Increase) in other assets (29,459) (14,725)
----------- ------------
Net cash provided by operating
activities 95,835 121,860
----------- ------------
Cash flows from investing activities:
Additions to plant and equipment (59,266) (58,021)
Proceeds from sales of plant and
equipment 5,391 4,934
Acquisition of businesses, net of
cash acquired (60,437) ---
----------- ------------
Net cash used for investing activities (114,312) (53,087)
----------- ------------
Cash flows from financing activities:
Bank and commercial paper borrowings
(repayments) 186,502 (243,472)
Other debt (repayments) borrowings (4,678) 221,441
Common stock reissued from treasury 21,115 14,964
Treasury stock purchases (156,959) (33,580)
Dividends paid (32,975) (30,150)
----------- -----------
Net cash provided by (used for)
financing activities 13,005 (70,797)
----------- -----------
Net decrease in cash (5,472) (2,024)
Cash at beginning of period 149,303 110,288
----------- -----------
Cash at end of period $ 143,831 $ 108,264
=========== ===========
Supplemental disclosures of cash flow
information:
Cash paid during the period for:
Interest $ 12,586 $ 3,447
Income taxes 22,423 19,421
</TABLE>
<PAGE> 6
-6-
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
Liquidity and Capital Resources
The liquidity and capital resources discussion included
in Management's Discussion and Analysis of Financial
Condition and Results of Operations of the Company's
Fiscal 1999 Annual Report on Form 10-K remains
applicable, other than the common stock repurchase
program described below.
In Fiscal 1992, the Company began a common stock
repurchase program which continued into the first
quarter of Fiscal 2000, resulting in the cumulative
repurchase of 80,000,000 shares of common stock.
The Board of Directors authorized the repurchase of an
additional 8,000,000 shares in July 1999. Under this
latest authorization, 3,425,400 shares were purchased
through October 2, 1999. The increase in treasury stock
purchases in the period ended October 2, 1999 primarily
reflects shares repurchased for acquisitions.
Long-term debt to capitalization ratio was 42% at
October 2, 1999, exceeding the 35% to 40% target ratio
due to the shares repurchased for acquisitions.
Results of Operations
For the period ended October 2, 1999, the Company
recorded a one-time, after-tax, non-cash charge of $8
million to comply with the required adoption of AICPA
Statement of Position 98-5 (SOP 98-5), "Reporting on
the Costs of Start-up Activities." SOP 98-5 requires
the write-off of any unamortized costs of start-up
activities and organization costs. Going forward such
costs will be expensed as incurred.
Sales and cost of sales increased about 11.1% and 10.7%,
respectively, over the same quarter of the prior year.
Real sales growth was up over 10% resulting primarily
from volume growth and was over four points higher than
the same period last year, after adjusting for a 1.1%
increase due to acquisitions and a 0.2% deflation in
food costs, due primarily to lower costs in poultry,
dairy and canned products.
Operating expenses for the periods presented remained
approximately the same as a percent of sales.
Interest expense in the current period increased over
the prior period due to increased borrowings.
Income taxes for the periods presented reflect an
effective rate of 38.5% this year compared to 39% last
year.
<PAGE> 7
-7-
Pretax earnings and net earnings before the accounting
change increased 21.3% and 22.3%, respectively, over
the prior year. The increases were due to the factors
discussed above as well as the Company's success in its
continued efforts to increase sales to the Company's
higher margin territorial street customers.
Basic and diluted earnings per share before the
accounting change increased 23.1% over the same period
last year due to the factors discussed above, along
with the decrease in average shares outstanding,
reflecting purchases of shares made through the
Company's share repurchase program.
A reconciliation of basic and diluted earnings per
share follows on the next page.
Acquisitions
In July 1999, SYSCO bought Newport Meat Co. Inc., a
distributor in southern California of fresh aged beef
and other meats, seafood and poultry products. In
August 1999, the company acquired Doughtie's Foods,
Inc., a food distributor located in Virginia and bought
substantially all of the assets of Buckhead Beef
Company, Inc., a distributor located in Georgia of
custom-cut fresh steak and other meats, seafood and
poultry products.
The transactions were accounted for using the purchase
method of accounting and the financial statements for
the quarter ended October 2, 1999 include the results
of the acquired companies from the respective dates
they joined SYSCO. There was no material effect,
individually or in the aggregate, on SYSCO's operating
results or financial position from these transactions.
<PAGE> 8
-8-
The following table sets forth the computation of basic and
diluted earnings per share:
<TABLE>
<CAPTION>
13 - Week Period Ended
--------------------------------
Oct. 2, 1999 Sept. 26, 1998
------------ --------------
<S> <C> <C>
Numerator:
Numerator for basic earnings
per share --
income available to common
shareholders $ 97,638,000 $ 86,420,000
============ ============
Denominator:
Denominator for basic earnings
per share --
weighted-average shares 328,925,219 334,849,272
Effect of dilutive securities:
Employee and director stock
options 4,561,936 3,334,983
------------ ------------
Denominator for diluted earnings
per share --
adjusted weighted-average shares 333,487,155 338,184,255
============ ============
Basic earnings per share $0.30 $0.26
============ ============
Diluted earnings per share $0.29 $0.26
============ ============
</TABLE>
<PAGE> 9
-9-
Year 2000
SYSCO has been replacing and enhancing its information systems
to gain operational efficiencies with the implementation of the
SYSCO Uniform System (SUS) which is Year 2000 compliant.
To address the Year 2000 issue, SYSCO instituted an enterprise-
wide Year 2000 compliance project in January 1998. SYSCO's Year
2000 project used two outside technology consulting firms - one
with expertise in information technology (IT) and project
management and the other with expertise in engineering to
identify Year 2000 issues in non-IT systems and equipment that
have embedded microchips. SYSCO established a formal project
management methodology to address the Year 2000 issue. SYSCO's
Year 2000 project consists of four phases: i) Information
Gathering and Planning - This phase consisted of gathering
information about SYSCO's IT and non-IT systems, as well as
identifying significant suppliers, customers and other third
parties. The primary objective was to build a detailed
inventory of information; ii) Assessment - This phase consisted
of analyzing the information gathered during the first phase.
The process included examining and evaluating SYSCO's IT systems
and non-IT systems with embedded microchips for exposure to date
sensitivity. The primary objective of the assessment phase was
to identify components that are not Year 2000 compliant so that
they could be corrected, replaced or eliminated; iii)
Remediation - This phase consisted of correcting, replacing or
eliminating any components found during the assessment phase
that were not Year 2000 compliant. This included addressing
SYSCO's internally developed mission critical IT systems,
purchased hardware and software, and non-IT systems and
equipment with embedded microchips; and iv) Testing - This phase
consisted of systems integration testing of SYSCO's mission
critical IT systems used throughout the Company, as well as
specific systems interface testing with certain customers and
certain suppliers to ensure their Year 2000 readiness.
In March 1999, SYSCO completed extensive testing of its mission
critical IT systems using multiple Year 2000 date scenarios to
simulate fiscal and calendar crossovers. These systems were
found to be Year 2000 compliant. SYSCO has also completed a
comprehensive assessment of its IT systems and non-IT systems
with embedded microchips and is completing upgrades and
replacements of non-compliant systems and equipment. Although
the percentages of work completed vary across SYSCO's
operations, SYSCO plans to complete the remaining upgrades and
replacements by December 1999.
An important component of SYSCO's Year 2000 readiness efforts
has focused on verifying to the extent possible that its
significant suppliers are currently Year 2000 compliant or have
adequate remediation plans in place to ensure Year 2000
compliance. SYSCO analyzed and categorized its suppliers and
then contacted in writing the significant suppliers to solicit
information on their Year 2000 preparedness efforts. SYSCO has
obtained Year 2000 information from the majority of the
identified suppliers.
<PAGE> 10
-10-
The total costs which will be incurred to provide Year 2000
compliance will not have a material impact on the financial
statements of the Company.
The Company has identified three most reasonably likely worst
case scenarios: (1) loss of public power supplies; (2) loss of
communication infrastructure; and (3) failure of the company's
mission critical IT systems and infrastructure. Within the
three most reasonably likely worst case scenarios, SYSCO's goal
is to identify actions that can be taken prior to January 2000
that would minimize or mitigate the failures should they occur.
Contingency plans have been developed for the core business
functions and have been deployed to SYSCO's distribution centers
for review and implementation.
Although SYSCO's Year 2000 efforts are intended to minimize the
adverse effects of the Year 2000 issue on its business and
operations, the actual effects of the issue and the success or
failure of the Company's efforts described above cannot be known
until the Year 2000. Failure by SYSCO, its suppliers, customers
and other third parties to address adequately their respective
Year 2000 issues in a timely manner, insofar as such issues
relate to the Company's business and operations, could have a
material adverse effect on SYSCO.
Item 3. Quantitative and Qualitative Disclosures about Market
Risks
SYSCO does not utilize financial instruments for trading
purposes and holds no derivative financial instruments
which could expose the company to significant market
risk. SYSCO's exposure to market risk for changes in
interest rates relates primarily to its long-term
obligations. At October 2, 1999 the company had
outstanding $274,644,000 of commercial paper with
maturities through November 1, 1999. The company's
remaining long-term debt obligations of $780,524,000
were primarily at fixed rates of interest. SYSCO has no
significant cash flow exposure due to interest rate
changes for long-term debt obligations.
----------------------------
Statements made herein regarding continuation of the share
repurchase program, Year 2000 compliance of SUS and potential
Year 2000 costs are forward-looking statements under the Private
Securities Litigation Reform Act of 1995. These statements
involve risks and uncertainties and are based on current
expectations and management's estimates; actual results may
differ materially. Share repurchases could be affected by
market prices of the Company's stock as well as management's
decision to utilize its capital for other purposes. Potential
Year 2000 costs could be affected by conditions in the economy,
the industry and internal factors that may alter planned
results. Furthermore, potential Year 2000 costs and compliance
efforts could be affected by the ability of SYSCO's suppliers
and customers to effectively address Year 2000 issues.
<PAGE> 11
-11-
Those risks and uncertainties that could impact these statements
include the possibility that the Company's information systems
will not operate as anticipated and therefore not provide the
Company with a competitive edge, risks relating to the acquired
companies, the risks of deteriorating margins, leverage and debt
risks and other risks detailed in the Company's Fiscal 1999
Annual Report on Form 10-K.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
SYSCO is engaged in various legal proceedings which have
arisen but have not been fully adjudicated. These
proceedings, in the opinion of management, will not have a
material adverse effect upon the consolidated financial
position or results of operations of the company when
ultimately concluded.
Item 2. Changes in Securities and Use of Proceeds.
On July 30, 1999, in connection with the acquisition by
merger of Newport Meat Company ("Newport"), the Company
issued 1,031,419 unregistered, restricted shares to the
former owners of Newport. The shares were issued pursuant
to the exemption from registration provided by Section
4(2) of the Securities Act of 1933, as amended.
On August 20, 1999, in connection with the acquisition of
substantially all of the assets of Buckhead Beef Company,
Inc. ("Buckhead"), the Company issued 1,155,797
unregistered, restricted shares to the former owners of
Buckhead. The shares were issued pursuant to the
exemption granted by Section 4(2) of the Securities Act of
1933, as amended.
Item 3. Defaults upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
None
Item 5. Other Information
On November 4, 1999, the Board of Directors increased the
quarterly cash dividend to $0.12 per share from $0.10 per
share.
<PAGE> 12
-12-
On November 5, 1999 shareholders of the Company approved
the adoption of an amendment to SYSCO's Restated
Certificate of Incorporation to increase the shares of
common stock that SYSCO has the authority to issue to one
billion (1,000,000,000) shares.
<PAGE> 13
-13-
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits.
3(a) Restated Certificate of Incorporation
incorporated by reference to Exhibit 3(a) to
Form 10-K for the year ended June 28, 1997
(File No. 1-6544).
3(b) Bylaws, as amended, incorporated by reference
to Exhibit 3(a) to Form 10-K for the year
ended July 3, 1999 (File No. 1-6544).
3(c) Form of Amended Certificate of Designation
Preferences and Rights of Series A Junior
Participating Preferred Stock, incorporated
by reference to Exhibit 3(c) to Form 10-K for
the year ended June 29, 1996 (File No. 1-
6544).
4(a) Sixth Amendment and Restatement of
Competitive Advance and Revolving Credit
Facility Agreement dated May 31, 1996,
incorporated by reference to Exhibit 4(a) to
Form 10-K in the year ended June 27, 1996
(File No. 1-6544).
4(b) Agreement and Seventh Amendment to
Competitive Advance and Revolving Credit
Facility Agreement dated as of June 27, 1997
incorporated by reference to Exhibit 4(a) to
Form 10-K for the year ended June 28, 1997
(File No. 1-6544).
4(c) Agreement and Eighth Amendment to Competitive
Advance and Revolving Credit Facility
Agreement dated as of June 22, 1998,
incorporated by reference to Exhibit 4(c) to
Form 10-K for the year ended July 3, 1999
(File No. 1-6544).
4(d) Senior Debt, dated as of June 15, 1995,
between Sysco Corporation and First Union
National Bank of North Carolina, Trustee,
incorporated by reference to Exhibit 4(a) to
Registration Statement on Form S-3 filed June
6, 1995 (File No. 33-60023).
4(e) First Supplemental Indenture, dated June 27,
1995, between Sysco Corporation and First
Union Bank of North Carolina, Trustee as
amended, incorporated by reference to Exhibit
4(e) to Form 10-K for the year ended June 29,
1996 (File No. 1-6544).
<PAGE> 14
-14-
4(f) Second Supplemental Indenture, dated as of May
1, 1996, between Sysco Corporation and First
Union Bank of North Carolina, Trustee as
amended, incorporated by reference to Exhibit
4(f) to Form 10-K for the year ended June 29,
1996 (File No. 1-6544).
4(g) Third Supplemental Indenture, dated as of
April 25, 1997, between Sysco Corporation and
First Union National Bank of North Carolina,
Trustee incorporated by reference to Exhibit
4(g) to Form 10-K for the year ended June 28,
1997 (File No. 1-6544).
4(h) Fourth Supplemental Indenture, dated as of
April 25, 1997, between Sysco Corporation and
First Union National Bank of North Carolina,
Trustee incorporated by reference to Exhibit
4(h) to Form 10-K for the year ended June
28,1997 (File No. 1-6544).
4(i) Fifth Supplemental Indenture, dated as of July
27, 1998 between Sysco Corporation and First
Union National Bank, Trustee incorporated by
reference to Exhibit 4 (h) to Form 10-K for
the year ended June 27, 1998 (File No.
1-6554).
15 Letter from Arthur Andersen LLP dated November 11, 1999,
re: unaudited financial statements.
27 Financial Data Schedule
(b) Reports on Form 8-K:
On August 30, 1999, the Company filed a Form 8-K to
attach a press release dated August 4, 1999 announcing
results of operations for the fiscal year ended July 3,
1999 (File No. 1-6544).
<PAGE> 15
-15-
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
SYSCO CORPORATION
(Registrant)
By /s/ JOHN K. STUBBLEFIELD, JR.
--------------------------------
John K. Stubblefield, Jr.
Senior Vice President,
Finance & Administration
Date: November 11, 1999
<PAGE> 16
EXHIBIT INDEX
NO. DESCRIPTION
- ---------------- ---------------------------------------------------------
3(a) Restated Certificate of Incorporation incorporated by
reference to Exhibit 3(a) to Form 10-K for the year ended
June 28, 1997 (File No. 1-6544).
3(b) Bylaws, as amended, incorporated by reference to Exhibit
3(a) to Form 10-K for the year ended July 3, 1999 (File
No. 1-6544).
3(c) Form of Amended Certificate of Designation Preferences
and Rights of Series A Junior Participating Preferred
Stock, incorporated by reference to Exhibit 3(c) to Form
10-K for the year ended June 29, 1996 (File No. 1-6544).
4(a) Sixth Amendment and Restatement of Competitive Advance
and Revolving Credit Facility Agreement dated May 31,
1996, incorporated by reference to Exhibit 4(a) to Form
10-K in the year ended June 27, 1996 (File No. 1-6544).
4(b) Agreement and Seventh Amendment to Competitive Advance
and Revolving Credit Facility Agreement dated as of June
27, 1997 incorporated by reference to Exhibit 4(a) to
Form 10-K for the year ended June 28, 1997 (File No.
1-6544).
4(c) Agreement and Eighth Amendment to Competitive Advance and
Revolving Credit Facility Agreement dated as of June 22,
1998, incorporated by reference to Exhibit 4(c) to Form
10-K for the year ended July 3, 1999 (File No. 1-6544).
4(d) Senior Debt, dated as of June 15, 1995, between Sysco
Corporation and First Union National Bank of North
Carolina, Trustee, incorporated by reference to Exhibit
4(a) to Registration Statement on Form S-3 filed June 6,
1995 (File No. 33-60023).
<PAGE> 17
NO. DESCRIPTION
- ---------------- ---------------------------------------------------------
4(e) First Supplemental Indenture, dated June 27, 1995,
between Sysco Corporation and First Union Bank of North
Carolina, Trustee as amended, incorporated by reference
to Exhibit 4(e) to Form 10-K for the year ended June 29,
1996 (File No. 1-6544).
4(f) Second Supplemental Indenture, dated as of May 1, 1996,
between Sysco Corporation and First Union Bank of North
Carolina, Trustee as amended, incorporated by reference
to Exhibit 4(f) to Form 10-K for the year ended June 29,
1996 (File No.
1-6544).
4(g) Third Supplemental Indenture, dated as of April 25, 1997,
between Sysco Corporation and First Union National Bank
of North Carolina, Trustee incorporated by reference to
Exhibit 4(g) to Form 10-K for the year ended June 28,
1997 (File No. 1-6544).
4(h) Fourth Supplemental Indenture, dated as of April 25,
1997, between Sysco Corporation and First Union National
Bank of North Carolina, Trustee incorporated by reference
to Exhibit 4(h) to Form 10-K for the year ended June
28,1997 (File No.
1-6544).
4(i) Fifth Supplemental Indenture, dated as of July 27, 1998
between Sysco Corporation and First Union National Bank,
Trustee incorporated by reference to Exhibit 4 (h) to
Form 10-K for the year ended June 27, 1998 (File No.
1-6554).
15 Letter from Arthur Andersen LLP dated November 11, 1999,
re: unaudited financial statements
27 Sysco Corporation and its Consolidated Subsidiaries
Financial Data Schedule
<PAGE> 1
Exhibit 15
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Board of Directors and Shareholders
of Sysco Corporation:
We have reviewed the consolidated balance sheets of Sysco Corporation (a
Delaware corporation) and its consolidated subsidiaries as of October 2, 1999
and September 26, 1998 and the related consolidated results of operations and
cash flows for the thirteen week periods then ended included in the Company's
Quarterly Report on Form 10-Q. These financial statements are the
responsibility of the Company's management.
We conducted our review in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical procedures to
financial data and making inquiries of persons responsible for financial and
accounting matters. It is substantially less in scope than an audit conducted
in accordance with generally accepted auditing standards, the objective of
which is the expression of an opinion regarding the financial statements taken
as a whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that should
be made to the financial statements referred to above for them to be in
conformity with generally accepted accounting principles.
/s/ Arthur Andersen LLP
Houston, Texas
November 11, 1999
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from Item 1.
Financial Statements and is qualified in its entirety by reference to such
financial statements.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JAN-02-2000
<PERIOD-END> OCT-02-1999
<CASH> 143,831
<SECURITIES> 0
<RECEIVABLES> 1,480,448
<ALLOWANCES> 29,567
<INVENTORY> 910,746
<CURRENT-ASSETS> 2,575,530
<PP&E> 2,379,174
<DEPRECIATION> 1,133,248
<TOTAL-ASSETS> 4,398,990
<CURRENT-LIABILITIES> 1,673,186
<BONDS> 1,055,168
382,587
0
<COMMON> 0
<OTHER-SE> 1,053,314
<TOTAL-LIABILITY-AND-EQUITY> 4,398,990
<SALES> 4,657,034
<TOTAL-REVENUES> 4,657,034
<CGS> 3,793,200
<TOTAL-COSTS> 4,485,199
<OTHER-EXPENSES> 189
<LOSS-PROVISION> 5,979
<INTEREST-EXPENSE> 17,944
<INCOME-PRETAX> 171,835
<INCOME-TAX> 66,156
<INCOME-CONTINUING> 105,679
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 8,041
<NET-INCOME> 97,638
<EPS-BASIC> 0.30
<EPS-DILUTED> 0.29
</TABLE>