Sysco Corporation Company Profile 1390 Enclave Pkwy. Houston, TX 281-584-1390 http://www.sysco.com #69 in FORTUNE 500 (May 2012) This company has the menu that people depend on. Sysco is the #1 foodservice supplier in North America, serving some 400,000 customers with a fleet of 8,700 delivery vehicles and about 180 distribution centers in the US, Canada, and Ireland. Sysco Corporation, through its subsidiaries, engages in the distribution of food and related products primarily to the foodservice or food-away-from-home industry in North America. Segments The company’s primary segments include Broadline and SYGMA. Broadline operating companies distribute a line of food products and various non-food products to their customers. SYGMA operating companies distribute a line of food products and various non-food products to chain restaurant customer locations. The company’s other segments include its specialty produce and lodging industry products segments and a company that distributes to international customers. Specialty produce companies distribute fresh produce and other foodservice products. The company’s lodging industry products company distributes personal care guest amenities, equipment, housekeeping supplies, room accessories and textiles to the lodging industry. The products the company distributes include a line of frozen foods, such as meats, fully prepared entrees, fruits, vegetables and desserts; a line of canned and dry foods; fresh meats; dairy products; beverage products; imported specialties; and fresh produce. The company also supplies various nonfood items, including paper products, such as disposable napkins, plates and cups; tableware such as china and silverware; cookware such as pots, pans and utensils; restaurant and kitchen equipment and supplies; and cleaning supplies. The company’s operating companies distribute nationally-branded merchandise, as well as products packaged under its private brands. Its operating companies also provide ancillary services relating to foodservice distribution, such as providing customers with product usage reports and other data, menuplanning advice, food safety training and assistance in inventory control, as well as access to various third party services designed to add value to its customers’ businesses. The company’s customers in the foodservice industry include restaurants, hospitals, schools, hotels, industrial caterers and other similar venues where foodservice products are served. In April 2012, Dickey's Barbecue Restaurants Inc. has signed an exclusive agreement with Sysco Corp. to provide its franchises with a range of foodservice products. Sysco Corporation was founded in 1969. Year over year, Sysco Corp. has maintained the bottom line (from $1.2B to $1.2B) due to an increase the cost of goods from 80.9% to 81.3%; revenues grew from $37.2B to $39.3B Jul 03 2010 Jul 02 2011 TOTAL REVENUES 37,243.5 39,323.5 Cost Of Goods Sold 30,136.0 32,002.3 GROSS PROFIT 7,107.5 7,321.1 OPERATING EXPENSES, TOTAL 5,131.6 5,389.6 OPERATING INCOME 1,975.9 1,931.5 EBT 1,849.6 1,827.5 NET INCOME 1,180.0 1,152.0 Currency in Millions of US Dollars As of: Sales have increased nearly every year for the past four decades. This enviable history is built on durable relationships with both customers and suppliers. We believe we have many opportunities to continue to grow our business across all customer segments. The Sysco Brand Family Sysco Brands Sysco Brand products are positioned within four distinct levels to meet our customers’ needs for both quality and value at a range of price points. Sysco Brand products compare favorably with other leading food service products, and always come backed by Sysco Brand quality assurance. Meat and Seafood Brands Sysco proprietary brands for meat and seafood offer the best in quality, carefully sourced from suppliers who must adhere to Sysco’s guidelines for quality, animal welfare and safe handling practices. Each of our brands – Butcher’s Block meats, Fire River Farms ground beef products, White Marble Farms pork, and Portico Seafood – earns its starring role at the center of the plate. Specialty Products Sysco’s specialty brands put quality ethnic and specialty flavors at the foodservice operator’s fingertips. From the Italian zest of Arrezio brand products to the Mexican heat of Casa Solana and the authentic deli character of Block & Barrel products, Sysco specialty brands let you bring the world to your customer’s plate. Food Category Leaders Your foodservice business depends on unrelenting quality in every food category, from dairy products and baked goods to crisp fresh vegetables and the perfect cup of coffee that keeps customers coming back for more. Sysco category leader brands provide those essentials with the quality and value foodservice operators can count on in every Sysco brand. Our Wholesome Farms dairy products, House Recipe condiments, FryOn shortening, BakerSource breads and Citavo coffees and beverages round out the meal – and the menu The Power of Partnership Innovation. Commitment. Success: Products are Just the Beginning The power of partnership means understanding your business needs and bringing you powerful solutions. Whether you’re looking for training, food cost advantages, service ideas, or new additions to your menu, we have the services and expertise to fit your needs. Business Reviews Through customized consultation, we uncover opportunities and plan actions which respond to your business needs, and help you be more successful. Services A wide range of valuable services, such as business reviews, profitability consultation, menu analysis, safety training and more, await you at Sysco. Sysco iCare Sysco iCare connects restaurateurs with business resources, assisting with everyday needs from payroll to marketing tools and more. Management Leadership Bill DeLaney President and Chief Executive Officer Age: 57 Total Annual Compensation: $1.7M Bill began his Sysco career in 1987 as assistant treasurer at Sysco’s corporate headquarters in Houston. He was promoted to treasurer in 1991, and in 1993 was named VP of the corporation, continuing in that role until 1994. He joined Sysco Syracuse in 1996 as chief financial officer, progressed to SVP in 1998 and executive VP in 2002. In 2004, he moved to Sysco Charlotte as president and chief executive officer. Bill returned to Houston in 2007 and subsequently was named EVP & CFO of the corporation. He was promoted to CEO and became a member of Sysco’s Board of Directors in 2009 and assumed his current position in 2010. Bill also serves on the Board of Directors at Express Scripts, Inc., The Center for Houston’s Future and Greater Houston Partnership. Manny Fernandez Chairman of the Board Manny has served as a director of Sysco since November 2006. He is the former chairman, president, and chief executive officer of Gartner Incorporated. Previously, he was president and CEO at Dataquest, Incorporated; Gavilan Computer Corporation; and Zilog Incorporated. Manny also serves on the board of directors of Brunswick Corporation, Flowers Foods, Inc., and The Black & Decker Corporation. He became Sysco’s non-executive chairman in March 2009. Senior Management Brian Beach Senior Vice President and President-Sysco Ventures Brian joined Sysco in early 2011 from the University of Florida where he was SVP for administration and business ventures and chief of staff to the president. In his current role, Brian leads Sysco’s pursuit and development of strategic foodservice opportunities, particularly in the areas of restaurant technology and applications. He began his career in 1991 at Ernst and Young as a senior consultant, followed by roles at Allen C. Ewing & Co. Investment Bankers, Synagen Capital Partners and SI Ventures, a technologyfocused venture capital firm. Bill Day Executive Vice President, Merchandising and Supply Chain Bill began his Sysco career in 1983 as a staff accountant at Sysco Memphis. He moved to Sysco Corporate in 1987 and in 1991 led the deployment of a new company-wide operating system. He was promoted to assistant controller of the corporation and became a corporate officer in 1999. He started the RDC project in 2000 and was promoted to VP supply chain management in 2003. In 2007, Bill was promoted to SVP, supply chain management and took on the additional responsibilities of the company’s merchandising activities in 2009. He stepped up to his current role in 2010. Twila Day Senior Vice President and Chief Information Officer Twila began her Sysco career in 1992 as a programmer analyst in the company’s information technology department and focused on the development of a company-wide ERP system. She progressed through a wide range of management positions before being promoted to assistant vice president, technology and applications in 2000. She became VP information technology and chief information officer in 2006, and was promoted to her current role in 2009. Kirk Drummond Senior Vice President, Sysco Business Services Kirk began his Sysco career in 1986 as controller of Sysco Grand Rapids. In 1989, he transferred to Sysco Atlanta as CFO and controller, a position he held until 1992 when he assumed the added duties of VP of finance. Kirk relocated to Sysco’s corporate headquarters in 1997 when he was appointed VP & controller. He was named vice president and chief information officer in 2000, and in 2005 he became senior vice president and chief information officer. He was promoted to SVP finance and treasurer in 2005 and took on his current responsibilities over Sysco Business Services in 2010. Mitch Elmer Senior Vice President, Controller and Chief Accounting Officer Mitch began his Sysco career in 1989 as a staff auditor. In 1991 he transferred to Sysco’s Virginia subsidiary and the following year was named vice president of finance and administration. He was appointed VP of finance at Sysco Louisville in 1995, progressed to SVP of marketing, merchandising and finance at that company in 1997, and the following year he transferred to Sysco Denver as VP finance. In 2000, Mitch returned to Sysco’s corporate office to serve as VP and controller, and in 2005 took on the additional responsibilities of chief accounting officer. Bill Goetz Senior Vice President, Marketing Bill joined Sysco in his current role in 2012. Prior to Sysco he served as president and chief operations officer-global accounts and strategic markets at Cintas Corporation. He began his career in 1986 as a management trainee at Cintas and progressed through a series of roles with increasing responsibility before becoming the company’s VP marketing and merchandising. In 2003, he joined ECOLAB Corporation as VP corporate marketing and later became VP international marketing. In 2006, he returned to Cintas as vice president and chief marketing officer. He took on his role as president & chief operations officer-global accounts & strategic markets in 2008. Mike Green Executive Vice President and Group President Age: 53 Total Annual Compensation: $935K Mike began his foodservice career in 1981, serving 10 years in various sales and management positions before joining Sysco Chicago as a member of the management development program in 1991. He progressed to VP of marketing that same year, VP of marketing and merchandising in 1992, and in the fall of 1992 was named EVP of the Chicago operation. He was moved to Sysco Detroit in 1994 as president and CEO. Mike was promoted to SVP operations, midwest region for the corporation in 2004 and became EVP, northeast and north central U.S. foodservice operations in 2008. He was named EVP, U.S. foodservice operations in 2010 and was promoted to EVP & group president in 2011. Mike oversees all Sysco operating companies, including U.S. & Canada broadline companies, meat companies, SYGMA, FreshPoint, International Food Group, Sysco Guest Supply and Pallas Foods in Ireland. Alan Hasty Senior Vice President, Merchandising Alan began his Sysco career in 1981 as a marketing associate for Sysco Orlando and progressed to various sales and merchandising positions before being promoted in 1985 to VP of merchandising at Sysco North Carolina. In 1990, he transferred to Sysco Virginia, was appointed EVP in 1993, and was promoted to president and CEO in 1995. He was named president and CEO of Sysco Cleveland in 2004 and took on added responsibilities as CEO of Sysco Cincinnati, Sysco Central Ohio, and Sysco Pittsburgh in 2009. He was moved to Sysco Corporate and promoted to his current position in 2010. Mike Headrick Senior Vice President, Foodservice Operations, South Region Mike began his Sysco career in 1978 as a staff accountant at Sysco Nashville and progressed to various management positions before being named senior vice president of finance and administration in 1989. He moved to Sysco Miami in 1993 as senior vice president of finance and operations, and became executive vice president in 1997. In 2000, he was named executive vice president and chief operating officer of Sysco Jackson and the following year was appointed president and CEO at Jackson. He was named president and CEO of Sysco Raleigh in 2005, and in 2009 he was promoted to CEO of Sysco Eastern Maryland, Sysco Hampton Roads, Sysco Knoxville, Sysco Memphis, Sysco Nashville, and Sysco Virginia. Mike was promoted to his current corporate role in 2010. Jim Hope Executive Vice President, Business Transformation Age: 52 Total Annual Compensation: $850K Jim began his Sysco career in 1987 as a financial analyst at the corporate headquarters in Houston and advanced through a variety of management positions before moving to Sysco Kansas City in 1993 as chief financial officer. In 2000, he was promoted to president and chief executive officer of that company. He returned to Houston in 2005 to serve as a group president for Sysco’s strategic development initiative where he focused on customer needs. In 2007, he was promoted to senior vice president, sales and marketing, and in 2008 he assumed leadership of Sysco’s business transformation. He was promoted to his current position in 2009. Kent Humphries Senior Vice President, Corporate Multi-Unit Sales and CEO of Sysco Canada Kent began working at Sysco Albany in 1972 as a marketing associate and after advancing through various management positions was promoted to executive vice president of that company in 1981. He was named president and chief executive officer of Sysco Syracuse in 1983, and in 1996 he moved to Sysco Baltimore as president and CEO. He relocated to Toronto in 2007 when he was promoted to senior vice president, Canadian foodservice operations for the corporation. He moved to Sysco Corporate and was promoted to his current position in 2010. Fred Lankford Senior Vice President, Distribution Services Fred joined Sysco in 1981 when his family’s foodservice company, S.E. Lankford, Jr. Produce Co., merged with Sysco and became Sysco Eastern Maryland. He held positions in operations, merchandising and sales prior to being named EVP in 1987. He was promoted to president of Sysco Eastern Maryland in 1995, and was promoted to his current role in 2011. Russell Libby Senior Vice President, General Counsel and Secretary Russell joined Sysco in 2007 as AVP-mergers & acquisitions and real estate and was promoted to VP general counsel and secretary in early 2011. He was promoted to his current role in November of 2011 and will continue to oversee Sysco’s legal affairs, mergers and acquisitions. Russell began his career in 1991 with Arnall Golden Gregory, LLP, in Atlanta, and has held leadership positions at Liuski International, Inc., a computer distribution and manufacturing company; COFRA Holding A.G., a Swiss international conglomerate; and Good Energies, Inc., an investment advisor. Chris Kreidler Executive Vice President and Chief Financial Officer Age: 48 Total Annual Compensation: $893K Chris joined Sysco in 2009 after serving as executive vice president and CFO at C&S Wholesale Grocers. Prior to joining C&S, he was a senior finance executive at Yum! Brands, Inc. He joined that company’s predecessor, PepsiCo, in 1996 and progressed through increasingly responsible finance roles, culminating in his position as senior vice president, corporate strategy and treasurer, in which he had global responsibility for strategy, treasury, M&A, and risk management. Paul Moskowitz Senior Vice President, Human Resources Paul came to Sysco in 2011 after serving as chief human resources officer at Dean Foods, a role he held since 2007. He began his career in 1988 as a compensation consultant at Towers Perrin. After joining Brinker International in 1992, he progressed through a series of roles with increasing responsibility at Brinker and then two other premier restaurant companies, Darden Restaurants, Inc. and Yum! Brands, Inc., culminating with his role as chief people officer at Pizza Hut USA. Larry Pulliam Executive Vice President and Group President Age: 57 Total Annual Compensation: $935K Larry began his Sysco career in 1975 with a predecessor company in Fort Worth, Texas. After joining Sysco’s corporate office in 1987, he served in various leadership roles in operating companies, returning to Sysco’s corporate office in 1997 as VP & chief information officer. He was promoted to president and CEO of Sysco Houston in 2000, and in 2002 Larry returned to Sysco Corporate as SVP of merchandising services. He was promoted to EVP, sales and global supply chain in 2006, and in 2009 was promoted to EVP, foodservice operations. He was named EVP & group president in 2011 and oversees Sysco’s Contract Sales, Distribution Services, Sustainability, Supply Chain Services, Procurement Services, Business Transformation and Information Technology functions. Scott Sonnemaker Senior Vice President, Foodservice Operations, West Region Scott began his Sysco career in 1996 as director, disposables merchandising, at Sysco’s corporate office in Houston. He was promoted to VP, merchandising and marketing at Sysco Portland in 1998, and was named senior vice president of sales for that company the next year. In 2000, he was promoted to executive vice president at Sysco Portland and became president and CEO in 2001. He was promoted to his current corporate position in 2008. Chuck Staes Senior Vice President, Foodservice Operations, North Region Chuck joined Sysco in 1986 when his family’s produce distribution business merged with Sysco Chicago. He became VP of merchandising in 1992 and was promoted to executive vice president in 1996, followed by his promotion to president of that company in 1997. He was promoted to his current corporate position in 2008. He spent two years in the management information consulting division of Arthur Andersen prior to joining Sysco. Key Executives - Sysco Corp (SYY) Name Board Relationships William J. DeLaney III 27 Relationships CEO, President, Director, Chairman of Employee Benefits Committee, Member of Finance Committee and Member of Executive Committee 57 Robert C. Kreidler No Relationships Chief Financial Officer and Executive VP 48 Thomas D. Huffhines No Relationships CEO of Sysco Food Services of Dallas, LP and President of Sysco Food Services of Dallas, LP 62 Alan W. Kelso 15 Relationships Vice President, Chairman of Sygma Network Inc and Chief Executive Officer of Sygma Network Inc 61 Robert J. McMakin No Relationships CEO of Sysco Food Services of Connecticut Inc and President of Sysco Food Services of Connecticut Inc 56 Title Age