Sysco (NYSE: SYY) details Jetro acquisition, higher leverage and $100M AI cost cuts
Rhea-AI Filing Summary
Sysco Corporation outlines the pending acquisition of Jetro Restaurant Depot and presents an upgraded financial profile for the combined company. Fiscal 2026 sales were $84.6 billion, with adjusted operating margin around the mid‑4% range and adjusted EPS of $4.61. For fiscal 2027, Sysco targets 6%–7% sales growth and 9%–11% adjusted EPS growth, including about $100 million of cost reductions driven by technology and AI initiatives.
Restaurant Depot generated about $16 billion 2025 revenue, a 13% adjusted EBITDA margin and roughly 90%+ free cash flow conversion, with ~167 stores and ~725,000 local customers. Pro forma, management highlights adj. EBITDA margin rising from 5.2% to 6.7% and free cash flow conversion improving from 80%+ to 90%+, supported by at least $250 million of expected net cost synergies and the potential for 125+ new Restaurant Depot locations over two decades.
Net debt to adjusted EBITDA was 2.8x–2.8x pre‑deal and is projected to peak near 4.5x at close, with a plan to reduce leverage by roughly 1.0x within 24 months and return toward a 2.75x long‑term target, while continuing significant dividends and buybacks.
Positive
- Restaurant Depot adds scale and high margins: ~$16 billion 2025 revenue, 13% adjusted EBITDA margin and ~90%+ free cash flow conversion, enhancing Sysco’s profitability profile.
- Synergy and accretion expectations: at least $250 million annual net cost synergies by year 3 and targeted mid‑ to high‑single‑digit year‑1 and low‑ to mid‑teens year‑2 adjusted EPS accretion from the combination.
- Stronger free cash flow outlook: management cites over $2 billion of additional longer‑term annual free cash flow potential and pro forma free cash flow conversion of 90%+.
- Clear capital return record: on track to have returned about $21.7 billion to shareholders over 13 years by FY27, including roughly $1.2 billion in FY26 and a planned $1 billion in FY27 dividends.
Negative
- Leverage spike from acquisition financing: net debt to adjusted EBITDA is projected to rise from roughly 2.7x to about 4.5x at close, creating a period of higher balance‑sheet risk.
- Meaningful non‑recurring financing and deal costs: fiscal 2026 results include bridge‑loan amortization and losses on deal‑contingent rate locks tied to the Jetro acquisition, as well as higher interest expense.
- Execution and integration risks: management highlights risks around regulatory approvals, integration difficulties, potential credit‑rating pressure, and the possibility that $250 million of net cost synergies and other benefits may not be realized on the expected timeline.
Filing Explained
The acquisition remains pre-closing; this filing adds registration disclosure but neither offers securities nor completes the combination.
The
For existing common holders, the presentation does not report a completed combination; its combined-company effects remain prospective. It also says the presentation is not an offer to sell securities or a solicitation of an offer, vote, or approval.
The filing says Sysco Holdings has filed an S-4 registration statement containing a prospectus, which is a registration step rather than a reported securities sale. The next resolution points are regulatory approval, satisfaction of closing conditions, and the eventual prospectus and transaction filings; the presentation says these may be delayed or may not be completed.
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AI-generated analysis. How Rhea-AI works. Not financial advice.
FAQ
What does Sysco (SYY) expect from its fiscal 2027 financial performance?
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Filed by Sysco Corporation
Pursuant to Rule 425 of the Securities Act of 1933
Subject Company: Sysco Corporation (Commission File No. 001-06544)
Date: August 12, 2026
The following is a presentation relating to the pending acquisition of Jetro Restaurant Depot by Sysco Corporation that was given to certain investors on August 12, 2026.
August 12, 2026 Sysco Headquarters Visit and Jetro Restaurant Depot Store Tour
Forward - Looking Statements 2 This presentation contains “forward - looking statements” within the meaning of the federal securities laws, including Section 27 A of the Securities Act of 1933 , as amended (the “Securities Act”) and Section 21 E of the Securities Exchange Act of 1934 , as amended . Words such as “expects,” “believes,” “anticipates,” “forecasts,” “intends,” “seeks,” “aims,” “plans,” “assumes,” “estimates,” “projects,” “should,” “would,” “could,” “may,” “will,” “shall” or variations of such words are generally part of forward - looking statements . Forward - looking statements are not historical facts . They are made based on management’s current expectations and beliefs concerning future developments and their potential effects upon Sysco Corporation (“Sysco”) and its consolidated subsidiaries . Forward - looking statements by their nature address matters that are, to different degrees, uncertain, such as statements about the expected timing and completion of the proposed transaction with Jetro Restaurant Depot, the anticipated benefits of the proposed transaction (including synergies), and plans and expectations for the combined company, including regarding its results of operations and financial conditions, leadership composition, share repurchases, dividend level, credit ratings and leverage ratio, as well as statements regarding Sysco’s future financial performance and results, including its expectations regarding its future growth, including growth in sales and earnings per share, and other statements that are not historical facts . All such forward - looking statements are not a guarantee of future performance and are based upon current plans, estimates, expectations and ambitions that are subject to risks, uncertainties and assumptions, many of which are beyond the control of the parties, that could cause actual results to differ materially from those expressed in such forward - looking statements . Key factors that could cause actual results to differ materially include, but are not limited to : the occurrence of any event, change or other circumstances that could give rise to the right of either or both parties to terminate the merger agreement ; the risk that regulatory approvals may not be obtained or other closing conditions may not be satisfied in a timely manner or at all, as well as the risk that regulatory approvals are obtained subject to conditions that are not anticipated ; the risk of other delays in closing the transaction ; the possibility that any of the anticipated benefits and projected synergies of the transaction will not be realized or will not be realized within the expected time period ; unforeseen or unknown liabilities ; Sysco’s ability to raise debt on favorable terms or at all ; risks related to business disruptions from the proposed transaction that may harm the business or current plans and operations of either or both parties, including disruption of management time from ongoing business operations ; credit ratings decline of the combined company following the proposed transaction ; the outcome of any legal proceedings that may be instituted against Sysco Holdings Corporation (“Sysco Holdings”), Sysco or their directors ; risks related to difficulties, inabilities or delays in integrating the parties’ businesses ; the risk that the proposed transaction and its announcement could have an adverse effect on the market price of the common stock of Sysco ; the risk that the proposed transaction and its announcement could have an adverse effect on the ability of either or both parties to retain and hire key personnel or maintain business, contractual or operational relationships, on the parties’ operating results and businesses generally ; certain restrictions during the pendency of the transaction that may impact Sysco’s and Jetro Restaurant Depot’s ability to pursue certain business opportunities or strategic transactions ; and the effects of industry, market, economic, political or regulatory conditions outside of the parties’ control, as well as the impact of geopolitical, economic and market conditions and developments, including changes in global trade policies and tariffs and foreign conflicts ; risks related to Sysco’s business initiatives ; periods of significant or prolonged inflation or deflation and their impact on Sysco’s product costs, volume, foot traffic and profitability generally ; risks related to Sysco’s efforts to implement its transformation initiatives and meet its other long - term strategic objectives ; risks of interruption of supplies and increase in product costs ; risks related to changes in consumer eating habits ; and the impact of natural disasters or adverse weather conditions, public health crises, adverse publicity or lack of confidence in Sysco’s products, and product liability claims . Should one or more of these risks or uncertainties materialize, or underlying assumptions prove incorrect, actual results may vary materially from those indicated in these forward - looking statements . Therefore, you should not place undue reliance on any of the forward - looking statements contained herein . For more information on these risks and other concerning factors that could cause actual results to differ from those expressed or forecasted, see Sysco’s Annual Reports on Form 10 - K, Quarterly Reports on Form 10 - Q, and other filings with the U . S . Securities and Exchange Commission (the “SEC”) . Any forward - looking statement speaks only as of the date on which it is made, and Sysco undertakes no obligation to update or revise any forward - looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events, except as otherwise may be required by law . This presentation includes certain measures which are not presented in accordance with generally accepted accounting principles in the United States of America (“GAAP”), such as EBITDA, Adjusted EBITDA, Net Debt, Free Cash Flow, Free Cash Flow Conversion, and Operating Income Adjusted for Certain Items, that Sysco believes provide important perspective with respect to underlying business trends . Non - GAAP financial measures are not measures of financial performance in accordance with GAAP and may exclude items that are significant in understanding and assessing our financial results . Non - GAAP measures provide meaningful supplemental information to both management and investors that ( 1 ) are indicative of the performance of the company’s underlying operations and ( 2 ) facilitate comparisons on a year - over - year basis . Non - GAAP measures should not be considered in isolation or as an alternative to GAAP measures, and should be considered only as a supplement to, and not as superior to, GAAP measures . The reasons for which management relies on non - GAAP measures, their definitions and reconciliations of historical non - GAAP financial measures to the nearest corresponding GAAP financial measure are included in slides 29 through 48 of this presentation . IMPORTANT INFORMATION REGARDING THE TRANSACTION AND WHERE TO FIND IT In connection with the proposed transaction, Sysco caused Sysco Holdings to file with the SEC a registration statement on Form S - 4 which includes a prospectus of Sysco Holdings (the “prospectus”) . BEFORE MAKING ANY INVESTMENT DECISION, INVESTORS AND SECURITY HOLDERS OF SYSCO ARE URGED TO READ THE PROSPECTUS REGARDING THE PROPOSED TRANSACTION AND ANY OTHER RELEVANT DOCUMENTS FILED OR TO BE FILED WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION . Investors and security holders may obtain free copies of the prospectus about Sysco and Sysco Holdings, any amendments or supplements thereto and other documents containing important information about Sysco and Sysco Holdings, once such documents are filed with the SEC, through the website maintained by the SEC at www . sec . gov . Copies of the documents filed with the SEC by Sysco will be available free of charge under the “Investors” section of Sysco’s website located at investors . sysco . com . NO OFFER OR SOLICITATION This presentation is not intended and does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction . No offer of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act .
Brandon Sewell INTERIM CHIEF FINANCIAL OFFICER Previously CFO of Sysco’s U.S. Business 12 YEARS @ SYSCO Kevin Hourican CHAIR OF THE BOARD AND CHIEF EXECUTIVE OFFICER 6 YEARS @ SYSCO 25 YEARS IN RETAIL Today’s Presenters Richard Kirschner CHIEF EXECUTIVE OFFICER JETRO RESTAURANT DEPOT 34 YEARS @ JRD Stanley Fleishman EXECUTIVE CHAIRMAN JETRO RESTAURANT DEPOT 40 YEARS @ JRD 3
1 See Non - GAAP reconciliations at the end of the presentation. U.S. Foodservice 2H Improvement • FY27 sales expectations of 6% - 7% include: • Volume growth, including local case growth of ~2.5% • Inflation of 1.5% - 2.0% • FY27 adjusted EPS growth expected at high - end of earnings algorithm including: • ~$100 million in cost out for the year • USFS segment profit growth • Positive Sysco Brand mix penetration Net Sales Growth Adj. Operating Income 1 Growth 2.7% 3.8% 1H26 2H26 Local Case Growth 0.5% 2.9% 1H26 2H26 (1.0%) 2.3% 1H26 2H26 4
Projecting approximately 2.5% local case growth in FY27, reflecting a 2 - year stack of 400+ bps Data represents USFS local case growth. Sysco’s Local Performance Has Meaningful Momentum into FY27 (1.4%) 0.5% 2.9% ~2.5% 4.0% 3.0% 2.0% 1.0% 0.0% (1.0%) (2.0%) (3.0%) FY 2025 1H26 2H26 FY 2027E 5
*Reflects approximate 2% contribution from extra week. Guidance as of 8/4/2026, and reflects 53 rd week except local case growth target of ~2.5% which is on a comparable 52 week basis. Fiscal Year 2027 Guidance Sales Growth Adj. EPS Growth 1 6 Year Over Year Sales Growth 1 See Non - GAAP reconciliations at the end of the presentation. • Sales expectations include: • volume growth, • inflation of ~1.5% - 2%, • ~2% related to 53 rd week • FY27 adjusted EPS growth expected at high - end of earnings algorithm including: • ~$100 million in cost out for the year , inclusive of actions announced in 3Q26 • USFS segment profit growth • Double digit profit growth for International segment • $1 billion in dividends 3.5% 3.4% 9% - 11% 6 - 7% Targeting ~2.5% local case growth in 2027 9 - 11% 3.2% 3.9% 6% - 7% FY 2025 FY 2026 FY 2027E FY 2025 FY 2026 FY 2027E Year Over Year Adj. EPS Growth * *
Tech & AI - enabled tools: • Unlock durable efficiency gains across sales , supply chain , and back office functions. • Enhance decision - making, accelerate execution, and reduce cost to serve • Improve fill rates, forecast accuracy, and strengthen service levels and customer experience In FY 27 , tech & AI - enabled tools are expected to deliver ~ $ 100 million in cost out : • ~$55 million in incremental benefits announced today • ~$45 million in carryover benefit from initiatives deployed in 3Q26 7 The Framework AI Focus Areas Why It Matters Revenue Growth & Sales Productivity Margin Expansion & Enterprise Economics Supply Chain & Working Capital Optimization Warehouse Labor & Delivery Intelligence Customer Experience & Back Office Enterprise AI Platform & Autonomous Tech Ops $100 Million in FY27 Cost Out, Driven by Technology & AI Transformation Initiatives 1 Better Improved service to customers and improved insights to colleagues. Faster Increased agility, reduced working capital, improved cash flow. 2 More Efficient 3 Reduced administrative tasks, more time spent on customer engagement.
Commercial & Working Capital Optimization The adoption of AI positions Sysco to deliver improved forecast accuracy and to be increasingly proactive across revenue, margin, working capital, and cost to serve The result: the right product, at the right price, available for the customer — with less manual work at every step FROM TO Revenue Margin Working Capital Cost to Serve Occasional stockouts lead to lost sales and customers shopping other distributors Excess inventory leads to “fresh to frozen” conversions, markdowns, and shrink Excess safety stock sits idle across the network Emergency freight moves product between sites to cover shortfalls More consistent fill rates protect revenue and the customer relationship AI - enabled demand signals are flagged early and allow for right - sized inventory to sell at full value Greater system visibility enables higher inventory turns that free up cash for growth and debt paydown More effectively balances inventory, minimizing emergency freight and reducing cost to serve 8
Transportation and Warehouse Labor Optimization FIVE PILLARS OF EXECUTION Improved On Time Delivery and Planned Customer Service Times Improved Workforce Productivity Accelerating the adoption of AI to drive productivity gains, operational efficiencies, and meaningful cost savings Optimized Asset Utilization Shift IQ • AI driven dynamic shift planning recommendation eliminates the need to rely on Excel based planning Slot IQ • Unlocks accurate item dimension data across the network and optimizes slotting, reducing travel time. Improved capacity, flow and ergonomics Transportation Transformation • Optimizes routes using real - time data to reduce costs, improve service and route density • Delivery data coupled with advanced business and AI analytics feeding route stop planned durations Improving On - time and ETA Notifications • Enhances driver and pedestrian safety through intelligent cameras, collision avoidance, and real - time alerts Enhanced Service Delivery Quality More Efficient Routing; Increasing Pieces per Mile EXAMPLES OF KEY INITIATIVES 9
AI is Accelerating How Technology Creates and Delivers Value For Sysco Sales AI360 | Agentic Bid Ops Better insights and next best actions for sales consultants Supply Chain Routing | Sourcing | Inventory Smarter sourcing, inventory, and routing decisions Back Office Call Center | Tech 4 Tech Faster, more consistent customer support & tech delivery FASTER TIME TO VALUE | BETTER QUALITY | GREATER RESILIENCE | LOWER COST A common AI, data, and technology foundation is enabling better customer experiences, smarter operations and faster innovation. Foundational AI Capabilities AI Platforms & Agents Enterprise Data & Analytics Agentic Software Development AI - enabled Cybersecurity & IT Operations Sysco Agentic Ecosystem (SAGE) Build Once. Reuse & Scale Everywhere. Govern Centrally 10
Delivering Significantly Enhanced Financial Profile 2 Combined Company Expected to Grow Faster, Be More Profitable, and Return More Value to Shareholders Than a Stand - Alone Sysco Creating a Preeminent Multi - Channel Foodservice Distribution Platform Local Revenue Increase Customer Value Proposition Future Geographic Expansion Greater Scale Sysco Pro Forma ~20% Sysco Pro Forma ~45% Sysco Pro Forma Revenue Adj. EBITDA 3 FCF 3,4 ~55% 5.2% 13.0% Sysco Restaurant Depot Pro Forma 6.7% 5 80%+ 90%+ Combined with 85%+ Pro Forma Foodservice Distributor #1 Cash & Carry Operator #1 Unlocking Meaningful Value Creation Step Up in Adj. EBITDA Margins 3 Higher FCF Conversion 6 125+ New Locations 1 1.5x+ Mid to High Single Digit Year 1 Adj. EPS Accretion 7 Low to Mid - Teens Year 2 Adj. EPS Accretion 7 >$2 Billion Additional Longer - Term Annual FCF Source: Investor Presentation from 3/30/26 1 Over at least the next two decades in the U.S. 2 Based on Dec - 25 LTM financials. 3 See Non - GAAP reconciliations at the end of the presentation. 4 Free Cash Flow defined as Adj. EBITDA – Capex. 5 Includes $250M annualized expected net cost synergies. 6 FCF Conversion defined as Free Cash Flow divided by Adj. EBITDA. 7 Does not include transaction - related D&A. 11
Whitestone, NY Headquarters ~10,000 Employees ~$16B 2025 Revenue 90%+ FCF Conversion 2 ~$2.1B 2025 Adj. EBITDA #1 U.S. Cash & Carry Wholesaler to Restaurants and Small Businesses Unique value proposition to small businesses as a low - cost provider with a wide assortment of high - quality, foodservice products ~$1.9B Free Cash Flow 1 Restaurant Depot is the Leader in U.S. Wholesale Cash & Carry – a Large and Growing Channel Highly Diversified Customer Base Large Store Footprint and Local Customer Base Track Record of Consistent Growth Revenue growth in 28 of the last 30 years Adj. EBITDA growth in 30 of the last 30 years 167 Total Locations ~725K Local Customers Local Restaurants / Caterers 57% Grocery 10% Other Foodservice 6% Jobbers 8% 2025 Sales Mix Breakdown by Customer All Other 3 20% Source: Investor Presentation from 3/30/26 Note: Dec - FYE financials. 1 Free Cash Flow calculated as Adj. EBITDA - Capex. 2 Calculated as Free Cash Flow / Adj. EBITDA. 3 Reflects miscellaneous and retail customers, such as temporary IDs, street vendors, donut and bagel shops, ice cream shops, tax exempt institutions, home businesses, retail distributors and concessions. 12
The Cash & Carry Advantages • Resilient business model with structurally lower cost to serve , supporting stable demand across economic cycles • Purpose - built to serve small restaurants , particularly independent operators with frequent, flexible replenishment needs • Complementary to broadline foodservice distribution, addressing distinct use cases not efficiently served by delivery - based models 13 Cash & Carry Historically Grows Faster Than Total Foodservice Restaurant Depot is the leader in the $60 - $70B growing B2B Cash & Carry channel Cash & Carry 1 Channel Breakdown, U.S. Revenue Channel Growth, 2019 - 2025 Sales CAGR ~$380B $60 - 70B Rest of Foodservice $310 - 320B Cash & Carry $60 - 70B Small/Indy C&C ~$10 - 15B Club Stores ~$20 - 25B Restaurant Depot ~$16B Others ~$10 - 15B Foodservice Cash & Carry Total Foodservice Broadline Cash & Carry ~4% ~4% ~5% Source: Third - party consulting market study, Technomic channel report. Note: 1 Includes all foodservice relevant spend at C&C locations, club stores, retail establishments, and e - commerce.
~$2 6% ~$16 13% 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Revenue ($B) 2018 2019 2020 2021 2022 2023 2024 2025 2015 2016 2017 Adj. EBITDA Margin Deflation COVID Global Financial Crisis Adj. EBITDA Revenue Same Store Sales 1 CAGR: CAGR: Average Growth: +14% +9% +7% 2004 - 2025 2004 - 2025 2004 - 2025 Restaurant Depot: Consistent and Profitable Growth Over the Last Two Decades Restaurant Depot Historical Performance Over Time ($B) Restaurant Depot has a resilient business model that performs well throughout economic cycles Note: Dec - FYE 2025 financials. 1 Same Store Sales growth based on stores open longer than 18 months. 14
Restaurant Depot’s Winning Formula • Savings: Low prices driven by lower cost to serve • Service: No purchase minimums and product available on demand • One Stop Shopping: wide selection of commercial pack size assortment tailored to restaurant customers across all cuisine types • Free membership drives loyalty and rich insights on customer spending Restaurant Depot: Efficient Store Layout with Comprehensive Product Selection Savings, Selection & Service – 7 Days a Week! 15
Average JRD vs. Average Club Peer Club Peer Average $180M $97M Net sales / store (w/out membership fees) JRD's gross margin is 6 ppt higher than club peers average 13% 19% Gross profit % 1 JRD's OpEx intensity is 5 ppt lower than club peers average 12% 7% OpEx % 2% 12% Operating Profit % (w/out membership fees) JRD does not generate any income from membership fees, which contribute 2 ppt to average of club peer margins 4% 12% Operating Profit % (incl. membership fees) Note: Numbers may not foot due to rounding; 1. Rebates reclassified from SG&A to gross margin to align with peer accounting treatment; no impact on operating margin. Source: Company financials; Club peers include BJ’s Wholesale, Costco, and Sam’s Club JRD Has Higher Gross Margin & Lower OpEx Intensity Than Club Peers 16
4% 12% Club op profit +0 - 2% Lower occupancy costs +0 - 1% Fewer Leaner operating hours staffing model +2 - 4% +3 - 4% Favorable product mix (0 - 1%) Higher shrink +2 - 3% All other (2%) Membership fees JRD op profit Walk from Club Store to JRD Operating Profit (% of sales, as of 2025) Leaner operations Note: Numbers may not foot due to rounding; Source: Company 10 - Ks; Company websites; Company earning calls Margin Bridge | Structural Advantages in Lean Operations & Product Mix Drive Much of JRD’s Margin Advantage 17
72 77 84 97 Average Store Operating Hours Per Week Club Peer #1 JRD stores are open ~10 - 20%+ fewer hours per week compared to peers JRD forgoes longer evening/weekend hours as customers shop in concentrated windows Combined with attractive sales per square foot, fewer hours means JRD is more efficient per operating hour — a direct contributor to its OpEx efficiency Club Peer #2 Club Peer #3 Source: Company websites Operating Hours | JRD Has 10 - 20% Fewer Operating Hours vs. Peers - Restaurant Operators Typically Have Narrower Shopping Windows Than Consumers 18
Store Manager Cashier Warehouse Associate Loading Dock Associate Forklift Operator Security In - store Replenishment In - store Merchandising Member / Customer Service Deli Counter Bakery Meat & Seafood Produce Sampling Station Optical Center Pharmacy Technician Tire & Auto Center Technician Gas Station Attendant In - Store Positions Club Peer Average JRD serves restaurant operators who typically seek an assortment - focused experience, seeking ingredients for their business JRD has fewer staffed functions leading to ~50% lower headcount per store - a direct driver of its OpEx advantage vs. peers Leaner Staffing | JRD Also Has ~50% Fewer Employees Per Store – Restaurant Operators Seek Fewer In - Store Services & Amenities Than Consumers Source: Company websites Position key Present at most locations Some presence No presence 19
89% 65% 11% 17% 18% Food & Grocery General Merchandise Gasoline & Services % of Sales by Product Category JRD has 6 ppt GM advantage vs. club peers Product mix a driving factor – shrink varies by ~40 bps JRD does not sell gas, which peers reportedly sell near break - even to drive traffic Other low - margin segments include apparel (~5% GM), gold bullion (~2% GM), generic drugs (1 - 2% GM) JRD does not generate income from membership fees; which club peers typically use to supplement mark - ups on cost 0.2% 0.6% Shrink (%) 13% 19% Gross Margin (%) Source: Restaurant Depot category economics data; Costco Wholesale Corporation Aug 2025 10 - K; Walmart Inc. Jan 2026 10 - K; BJ's Wholesale Club Holdings May 2026 8 - K 20 Club Peer avg. Op. Income from Membership Fees (%) 0% 2% Product Mix | Product Mix (Particularly Gas) Contributes to Spread in GM General Merchandise Food & Grocery
Investor Feedback and Questions Have Focused Upon the Following Topics Since Deal Announcement Margin Profile Deleverage Plan Better Together Synergies Restaurant Depot's Future Store Growth 21
Restaurant Depot Delivers Industry Leading EBITDA Margins Restaurant Depot's 13% EBITDA margin is sustainable and defensible . • Efficient inbound supply chain with lowest net landed cost. • Lower SG&A as the customer handles selection, delivery, fuel cost, and no sales commissions are incurred. • EBITDA margin profile in - line with Sysco's small, independent customers. $15 $15 $16 13% 13% 13% FY23 FY24 1 FY25 Revenue in bil. Adj. EBITDA Margin Source: Company filings. Note: Figures presented on Dec - 2025 LTM basis or closest reported period. Note: 1 See Non - GAAP reconciliations at the end of the presentation. 22
23 2.9x 2.8x 2.7x 4.5x 3.5x 2.75x 0x 1x 2x 3x 4x 5x Q2 2026 Q3 2026 Q4 2026 At Close (Est.) Year 2E Post - close LT Target Net Debt to Adjusted EBITDA 1 Leverage Trajectory • Ended the quarter with a 2.7x net debt leverage ratio • Investment grade credit ratings maintained • Committed to ~1.0x net leverage reduction within 24 months post - close • Long - term target remains 2.75x • No large - scale M&A until target leverage achieved • $250M in net cost synergies fully ramping in year 3 Strong Commitment to Rapid Deleveraging 1 See Non - GAAP reconciliations at the end of the presentation. 23
FY18 FY19 FY20 FY21 FY22 FY23 FY24 FY25 FY26 Cumulative Cash Returned to Shareholders in billions 24 $0.7 $3.3 $5.9 $7.6 $9.4 $11.1 $12.0 $13.5 $15.0 $17.2 $19.5 $20.7 $21.7 FY15 FY16 FY17 FY27E Dividends Share Repurchase Strong Cash Generation Drives Shareholder Returns On - Track to return approximately $21.7 billion in cumulative cash to shareholders over 13 years Returned ~1.2 billion in cash to shareholders in FY26
Differentiated Real Estate Strategy • High - value real estate with first - to - market , strategic advantage in dense urban environments • 130 owned stores representing ~80% of store footprint • Strategically located stores to facilitate convenient and efficient customer access , driving greater share of wallet High Confidence in Opening 125+ Net New Locations Restaurant Depot Locations In - House Logistics Facilities 100% of mature stores are profitable 125+ new locations 1 whitespace Overview of Real Estate Footprint 1 Over at least the next two decades in the U.S. 25
Opportunity to exceed the $250 Million included in accretion figures Significant growth opportunities represent incremental upside potential Purchasing Synergies JRD Store Growth Enhanced Fulfillment Models Better Selling Loyalty Broader Assortment, Greater Value "Better Together" Has Potential to Deliver Meaningful Upside to the $250 Million in Communicated Synergies 26
Compelling Value Creation Opportunities • Increased local revenue • Enhanced operating margins • Significantly accelerated total shareholder return • Significantly stronger free cash flow generation Revenue FCF 1,2 ~20% ~45% ~55% Adjusted EBITDA 1 Sysco Pro Forma 1.5x Local Revenue: Sysco’s most profitable U.S. foodservice business Better Together: Grow Faster, Step Up Profitability, and Return More Capital Note: Based on Dec - 25 LTM financials. 1 See Non - GAAP reconciliations at the end of the presentation. 2 Free Cash Flow defined as Adj. EBITDA – Capex. 27
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NON - GAAP RECONCILIATIONS 29
Impact of Certain Items 30 The discussion of our results includes certain non - GAAP financial measures, including EBITDA and adjusted EBITDA, that we believe provide important perspective with respect to underlying business trends . Other than EBITDA and free cash flow, any non - GAAP financial measures will be denoted as adjusted measures to remove ( 1 ) restructuring charges ; ( 2 ) expenses associated with our various transformation initiatives ; ( 3 ) severance charges ; and ( 4 ) acquisition - related costs consisting of : (a) intangible amortization expense and (b) acquisition costs and due diligence costs related to our acquisitions . Adjustments provided herein for fiscal year 2026 results of operations also remove the impact of a charge associated with a legal matter, amortization expense associated with debt issuance costs on a bridge loan facility, and a loss on deal contingent rate lock transactions entered into to mitigate interest rate risk on future permanent debt that could potentially be issued to finance the purchase of Jetro Restaurant Depot . No similar charges were applicable in fiscal year 2025 or fiscal year 2024 . Adjustments provided herein for fiscal year 2025 results of operations also remove the impact of a goodwill impairment charge . No similar charge was applicable in fiscal year 2026 or fiscal year 2024 . The results of our operations can be impacted due to changes in exchange rates applicable in converting local currencies to U . S . dollars . We measure our results on a constant currency basis . Constant currency operating results are calculated by translating current - period local currency operating results with the currency exchange rates used to translate the financial statements in the comparable prior - year period to determine what the current - period U . S . dollar operating results would have been if the currency exchange rate had not changed from the comparable prior - year period . We also measure our sales growth excluding the impact of our joint venture in Mexico which was divested in the second quarter of fiscal year 2025 . Management believes that adjusting its operating expenses, operating income, operating margin, interest expense, other (income) expense, net earnings and diluted earnings per share to remove these Certain Items, presenting its results on a constant currency basis, and adjusting its sales results to exclude the impact of its joint venture in Mexico provides an important perspective with respect to our underlying business trends and results . It provides meaningful supplemental information to both management and investors that ( 1 ) is indicative of the performance of the company’s underlying operations and ( 2 ) facilitates comparisons on a year - over - year basis . Sysco has a history of growth through acquisitions and excludes from its non - GAAP financial measures the impact of acquisition - related intangible amortization, acquisition costs and due - diligence costs for those acquisitions . We believe this approach significantly enhances the comparability of Sysco’s results for fiscal year 2026 , fiscal year 2025 , and fiscal year 2024 . Set forth below is a reconciliation of sales, operating expenses, operating income, interest expense, other (income) expense, net earnings and diluted earnings per share to adjusted results for these measures for the periods presented . Individual components of diluted earnings per share may not be equal to the total presented when added due to rounding . Adjusted diluted earnings per share is calculated using adjusted net earnings divided by diluted shares outstanding . The non - GAAP financial measures shown in the following tables should not be used as a substitute for the most comparable GAAP financial measures in assessing the company’s financial performance for the periods presented . An analysis of any non - GAAP financial measure should be used in conjunction with results presented in accordance with GAAP . Illustrative pro forma results are included, which show the impact of the combination of Sysco and Restaurant Depot, of which some metrics are Non - GAAP metrics . We believe these provide an important perspective related to underlying and potential pro forma business trends on the proposed combined organization . These pro forma metrics are produced using the same basis of adjustments, where applicable, for Sysco Corporation and Restaurant Depot .
Sysco Corporation and its Consolidated Subsidiaries Segment Results Non - GAAP Reconciliation (Unaudited) Impact of Certain Items on Applicable Segments, FY26 vs FY25 (Dollars in Millions) 31 %/bps Change Change in Dollars 26 - Week Period Ended Dec. 28, 2024 26 - Week Period Ended Dec. 27, 2025 U.S. FOODSERVICE OPERATIONS 2.7 % $ 757 $ 28,406 $ 29,163 Sales (GAAP) 2.6 % 142 5,401 5,543 Gross profit (GAAP) 0 bps 19.01 % 19.01 % Gross margin (GAAP) 5.0 % $ 184 $ 3,659 $ 3,843 Operating expenses (GAAP) (36.4) (4) (11) (15) Impact of restructuring and transformational project costs (1) (65.6) (21) (32) (53) Impact of acquisition - related costs (2) 4.4 % $ 159 $ 3,616 $ 3,775 Operating expenses adjusted for Certain Items (Non - GAAP) (2.4) % $ (42) $ 1,742 $ 1,700 Operating income (GAAP) 36.4 4 11 15 Impact of restructuring and transformational project costs (1) 65.6 21 32 53 Impact of acquisition - related costs (2) (1.0) % $ (17) $ 1,785 $ 1,768 Operating income adjusted for Certain Items (Non - GAAP) %/bps Change Change in Dollars 26 - Week Period Ended Jun. 28, 2025 26 - Week Period Ended Jun. 27, 2026 U.S. FOODSERVICE OPERATIONS 3.8 % $ 1,081 $ 28,559 $ 29,640 Sales (GAAP) 4.1 % 222 5,474 5,696 Gross profit (GAAP) 5 bps 19.17 % 19.22 % Gross margin (GAAP) 4.8 % $ 178 $ 3,700 $ 3,878 Operating expenses (GAAP) — — (34) (34) Impact of restructuring and transformational project costs (3) 5.1 2 (39) (37) Impact of acquisition - related costs (2) 5.0 % $ 180 $ 3,627 $ 3,807 Operating expenses adjusted for Certain Items (Non - GAAP)
Sysco Corporation and its Consolidated Subsidiaries Segment Results Non - GAAP Reconciliation (Unaudited) Impact of Certain Items on Applicable Segments, FY26 vs FY25 (Dollars in Millions) continued %/bps Change Change in Dollars 26 - Week Period Ended Dec. 28, 2024 26 - Week Period Ended Dec. 27, 2025 U.S. FOODSERVICE OPERATIONS 2.5 % $ 44 $ 1,774 $ 1,818 Operating income (GAAP) — — 34 34 Impact of restructuring and transformational project costs (3) (5.1) (2) 39 37 Impact of acquisition - related costs (2) 2.3 % $ 42 $ 1,847 $ 1,889 Operating income adjusted for Certain Items (Non - GAAP) Primarily represents severance and transformation initiative costs. (1) Primarily represents intangible amortization expense and acquisition costs. (2) 26 - week period ended Jun. 27, 2026 primarily represents severance charges, transformation initiative costs, and costs associated with a legal matter. 26 - week period ended Jun. 28, 2025 primarily represents severance and transformation initiative costs. (3) Represents that the percentage change is not meaningful. NM 32
Sysco Corporation and its Consolidated Subsidiaries Non - GAAP Reconciliation (Unaudited) Impact of Certain Items FY26 vs. FY25 (Dollars in Millions, Except for Share and Per Share Data) 33 %/bps Change Change in Dollars 52 - Week Period Ended Jun. 28, 2025 52 - Week Period Ended Jun. 27, 2026 3.9 % $ 3,183 $ 81,370 $ 84,553 Sales (GAAP) 0.3 207 (207) — Impact of Mexico joint venture sales 4.2 % $ 3,390 $ 81,163 $ 84,553 Comparable sales excluding Mexico joint venture (Non - GAAP) 3.9 % $ 3,183 $ 81,370 $ 84,553 Sales (GAAP) (0.6) (527) (527) Impact of currency fluctuations (1) 3.3 % $ 2,656 $ 81,370 $ 84,026 Comparable sales using a constant currency basis (Non - GAAP) 3.8 % $ 2,513 $ 66,401 $ 68,914 Cost of sales (GAAP) 4.5 % $ 670 $ 14,969 $ 15,639 Gross profit (GAAP) (0.9) (127) (127) Impact of currency fluctuations (1) 3.6 % $ 543 $ 14,969 $ 15,512 Comparable gross profit adjusted for Certain Items using a constant currency basis (Non - GAAP) 10 bps 18.40 % 18.50 % Gross margin (GAAP) - 4 bps (0.04) Impact of currency fluctuations (1) 6 bps 18.40 % 18.46 % Comparable gross margin adjusted for Certain Items using a constant currency basis (Non - GAAP) 5.6 % $ 663 $ 11,881 $ 12,544 Operating expenses (GAAP) (56.8) (104) (183) (287) Impact of restructuring and transformational project costs (2) (45.0) (72) (160) (232) Impact of acquisition - related costs (3) NM 92 (92) — Impact of goodwill impairment 5.1 579 11,446 12,025 Operating expenses adjusted for Certain Items (Non - GAAP) (1.0) (111) (111) Impact of currency fluctuations (1) 4.1 % $ 468 $ 11,446 $ 11,914 Comparable operating expenses adjusted for Certain Items using a constant currency basis (Non - GAAP) 24 bps 14.60 % 14.84 % Operating expense as a percentage of sales (GAAP) - 9 bps (0.53) (0.62) Impact of certain item adjustments 15 bps 14.07 % 14.22 % Adjusted operating expense as a percentage of sales (Non - GAAP)
Sysco Corporation and its Consolidated Subsidiaries Non - GAAP Reconciliation (Unaudited) Impact of Certain Items FY26 vs. FY25 (Dollars in Millions, Except for Share and Per Share Data) continued 34 %/bps Change Change in Dollars 52 - Week Period Ended Jun. 28, 2025 52 - Week Period Ended Jun. 27, 2026 0.2 % $ 7 $ 3,088 $ 3,095 Operating income (GAAP) 56.8 104 183 287 Impact of restructuring and transformational project costs (2) 45.0 72 160 232 Impact of acquisition - related costs (3) NM (92) 92 — Impact of goodwill impairment 2.6 91 3,523 3,614 Operating income adjusted for Certain Items (Non - GAAP) (0.5) (16) (16) Impact of currency fluctuations (1) 2.1 % $ 75 $ 3,523 $ 3,598 Comparable operating income adjusted for Certain Items using a constant currency basis (Non - GAAP) - 14 bps 3.80 % 3.66 % Operating margin (GAAP) - 6 bps 4.33 % 4.27 % Operating margin adjusted for Certain Items (Non - GAAP) - 5 bps 4.33 % 4.28 % Operating margin adjusted for Certain Items using a constant currency basis (Non - GAAP) - 14 bps 3.80 % 3.66 % Operating margin (GAAP) - 6 bps 4.33 % 4.27 % Operating margin adjusted for Certain Items (Non - GAAP) 12.9 % $ 82 $ 635 $ 717 Interest expense (GAAP) NM (30) — (30) Impact of bridge loan amortization (4) 8.2 % $ 52 $ 635 $ 687 Interest expense adjusted for Certain Items (Non - GAAP) NM $ 64 $ 38 $ 102 Other expense (GAAP) NM (54) — (54) Impact of deal contingent rate lock transactions (4) 26.3 % $ 10 $ 38 $ 48 Other expense adjusted for Certain Items (Non - GAAP)
Sysco Corporation and its Consolidated Subsidiaries Non - GAAP Reconciliation (Unaudited) Impact of Certain Items FY26 vs. FY25 (Dollars in Millions, Except for Share and Per Share Data) continued 35 %/bps Change Change in Dollars 52 - Week Period Ended Jun. 28, 2025 52 - Week Period Ended Jun. 27, 2026 (3.9) % $ (71) $ 1,828 $ 1,757 Net earnings (GAAP) 56.8 104 183 287 Impact of restructuring and transformational project costs (2) 45.0 72 160 232 Impact of acquisition - related costs (3) NM (92) 92 — Impact of goodwill impairment NM 30 — 30 Impact of bridge loan amortization (4) NM 54 — 54 Impact of deal contingent rate lock transactions (4) (64.3) (27) (42) (69) Tax impact of restructuring and transformational project costs (5) (51.4) (19) (37) (56) Tax impact of acquisition - related costs (5) NM 10 (10) — Tax impact of goodwill impairment (5) NM (7) — (7) Tax impact of bridge loan amortization (5) NM (13) — (13) Tax impact of deal contingent rate lock transactions (5) NM (10) 10 — Impact of other non - routine tax adjustments 1.4 % $ 31 $ 2,184 $ 2,215 Net earnings adjusted for Certain Items (Non - GAAP) (1.9) % $ (0.07) $ 3.73 $ 3.66 Diluted earnings per share (GAAP) 62.2 0.23 0.37 0.60 Impact of restructuring and transformational project costs (2) 45.5 0.15 0.33 0.48 Impact of acquisition - related costs (3) NM (0.19) 0.19 — Impact of goodwill impairment NM 0.06 — 0.06 Impact of bridge loan amortization (4) NM 0.11 — 0.11 Impact of deal contingent rate lock transactions (4) (55.6) (0.05) (0.09) (0.14) Tax impact of restructuring and transformational project costs (5) (50.0) (0.04) (0.08) (0.12) Tax impact of acquisition - related costs (5) NM 0.02 (0.02) — Tax impact of goodwill impairment (5) NM (0.01) — (0.01) Tax impact of bridge loan amortization (5) NM (0.03) — (0.03) Tax impact of deal contingent rate lock transactions (5) NM (0.02) 0.02 — Impact of other non - routine tax adjustments 3.4 % $ 0.15 $ 4.46 $ 4.61 Diluted earnings per share adjusted for Certain Items (Non - GAAP) (6) 489,825,648 480,612,203 Diluted shares outstanding Represents a constant currency adjustment which eliminates the impact of foreign currency fluctuations on the current year results. (1) Fiscal year 2026 includes $71 million related to restructuring costs, severance charges, and costs associated with a legal matter and $216 million related to various transformation initiative costs, primarily consisting of supply chain transformation costs and changes to our business technology strategy. Fiscal year 2025 includes $57 million related to restructuring and severance charges and $126 million related to various transformation initiative costs, primarily consisting of changes to our business technology strategy. (2) Fiscal year 2026 includes $147 million of intangible amortization expense and $85 million in acquisition and due diligence costs. Fiscal year 2025 includes $133 million of intangible amortization expense and $27 million in acquisition and due diligence costs. (3) Fiscal year 2026 includes amortization expense associated with debt issuance costs on a bridge loan facility and a loss on deal contingent rate lock transactions, both of which are related to the planned acquisition of Jetro Restaurant Depot. (4) The tax impact of adjustments for Certain Items is calculated by multiplying the pretax impact of each Certain Item by the statutory rates in effect for each jurisdiction where the Certain Item was incurred. (5) Individual components of diluted earnings per share may not add up to the total presented due to rounding. Total diluted earnings per share is calculated using adjusted net earnings divided by diluted shares outstanding. (6) Represents that the percentage change is not meaningful. NM
Sysco Corporation and its Consolidated Subsidiaries Non - GAAP Reconciliation (Unaudited) Impact of Certain Items FY25 vs. FY24 (Dollars in Millions, Except for Share and Per Share Data) 36 %/bps Change Change in Dollars 52 - Week Period Ended Jun. 29, 2024 52 - Week Period Ended Jun. 28, 2025 3.2 % $ 2,526 $ 78,844 $ 81,370 Sales (GAAP) 0.4 329 (536) (207) Impact of Mexico joint venture sales 3.6 % $ 2,855 $ 78,308 $ 81,163 Comparable sales excluding Mexico joint venture (Non - GAAP) 3.2 % $ 2,526 $ 78,844 $ 81,370 Sales (GAAP) — 33 33 Impact of currency fluctuations (1) 3.2 % $ 2,559 $ 78,844 $ 81,403 Comparable sales using a constant currency basis (Non - GAAP) 3.4 % $ 2,165 $ 64,236 $ 66,401 Cost of sales (GAAP) 2.5 % $ 361 $ 14,608 $ 14,969 Gross profit (GAAP) (0.1) (10) (10) Impact of currency fluctuations (1) 2.4 % $ 351 $ 14,608 $ 14,959 Comparable gross profit adjusted for Certain Items using a constant currency basis (Non - GAAP) - 13 bps 18.53 % 18.40 % Gross margin (GAAP) - 2 bps (0.02) Impact of currency fluctuations (1) - 15 bps 18.53 % 18.38 % Comparable gross margin adjusted for Certain Items using a constant currency basis (Non - GAAP) 4.2 % $ 475 $ 11,406 $ 11,881 Operating expenses (GAAP) (52.5) (63) (120) (183) Impact of restructuring and transformational project costs (2) (0.6) (1) (159) (160) Impact of acquisition - related costs (3) NM (92) — (92) Impact of goodwill impairment 2.9 319 11,127 11,446 Operating expenses adjusted for Certain Items (Non - GAAP) (0.1) (11) (11) Impact of currency fluctuations (1) 2.8 % $ 308 $ 11,127 $ 11,435 Comparable operating expenses adjusted for Certain Items using a constant currency basis (Non - GAAP) 13 bps 14.47 % 14.60 % Operating expense as a percentage of sales (GAAP) - 17 bps (0.36) (0.53) Impact of certain item adjustments - 4 bps 14.11 % 14.07 % Adjusted operating expense as a percentage of sales (Non - GAAP)
Sysco Corporation and its Consolidated Subsidiaries Non - GAAP Reconciliation (Unaudited) Impact of Certain Items FY25 vs. FY24 (Dollars in Millions, Except for Share and Per Share Data) continued 37 %/bps Change Change in Dollars 52 - Week Period Ended Jun. 29, 2024 52 - Week Period Ended Jun. 28, 2025 (3.6) % $ (114) $ 3,202 $ 3,088 Operating income (GAAP) 52.5 63 120 183 Impact of restructuring and transformational project costs (2) 0.6 1 159 160 Impact of acquisition - related costs (3) NM 92 — 92 Impact of goodwill impairment 1.2 42 3,481 3,523 Operating income adjusted for Certain Items (Non - GAAP) 0.1 2 2 Impact of currency fluctuations (1) 1.3 % $ 44 $ 3,481 $ 3,525 Comparable operating income adjusted for Certain Items using a constant currency basis (Non - GAAP) - 26 bps 4.06 % 3.80 % Operating margin (GAAP) - 9 bps 4.42 % 4.33 % Operating margin adjusted for Certain Items (Non - GAAP) - 9 bps 4.42 % 4.33 % Operating margin adjusted for Certain Items using a constant currency basis (Non - GAAP) (6.5) % $ (127) $ 1,955 $ 1,828 Net earnings (GAAP) 52.5 63 120 183 Impact of restructuring and transformational project costs (2) 0.6 1 159 160 Impact of acquisition - related costs (3) NM 92 — 92 Impact of goodwill impairment (44.8) (13) (29) (42) Tax impact of restructuring and transformational project costs (4) 2.6 1 (38) (37) Tax impact of acquisition - related costs (4) NM (10) — (10) Tax impact of goodwill impairment (4) NM 10 — 10 Impact of other non - routine tax adjustments 0.8 % $ 17 $ 2,167 $ 2,184 Net earnings adjusted for Certain Items (Non - GAAP)
Sysco Corporation and its Consolidated Subsidiaries Non - GAAP Reconciliation (Unaudited) Impact of Certain Items FY25 vs. FY24 (Dollars in Millions, Except for Share and Per Share Data) continued 38 %/bps Change Change in Dollars 52 - Week Period Ended Jun. 29, 2024 52 - Week Period Ended Jun. 28, 2025 (4.1) % $ (0.16) $ 3.89 $ 3.73 Diluted earnings per share (GAAP) 54.2 0.13 0.24 0.37 Impact of restructuring and transformational project costs (2) 3.1 0.01 0.32 0.33 Impact of acquisition - related costs (3) NM 0.19 — 0.19 Impact of goodwill impairment (50.0) (0.03) (0.06) (0.09) Tax impact of restructuring and transformational project costs (4) — — (0.08) (0.08) Tax impact of acquisition - related costs (4) NM (0.02) — (0.02) Tax impact of goodwill impairment (4) NM 0.02 — 0.02 Impact of other non - routine tax adjustments 3.5 % $ 0.15 $ 4.31 $ 4.46 Diluted earnings per share adjusted for Certain Items (Non - GAAP) (5) 503,096,086 489,825,648 Diluted shares outstanding Represents a constant currency adjustment, which eliminates the impact of foreign currency fluctuations on the current year results. (1) Fiscal 2025 includes $57 million related to restructuring and severance charges and $126 million related to various transformation initiative costs, primarily consisting of supply chain transformation costs and changes to our business technology strategy. Fiscal 2024 includes $56 million related to restructuring and severance charges and $64 million related to various transformation initiative costs, primarily consisting of changes to our business technology strategy. (2) Fiscal 2025 includes $133 million of intangible amortization expense and $27 million in acquisition and due diligence costs. Fiscal 2024 includes $128 million of intangible amortization expense and $31 million in acquisition and due diligence costs. (3) The tax impact of adjustments for Certain Items is calculated by multiplying the pretax impact of each Certain Item by the statutory rates in effect for each jurisdiction where the Certain Item was incurred. (4) Individual components of diluted earnings per share may not add up to the total presented due to rounding. Total diluted earnings per share is calculated using adjusted net earnings divided by diluted shares outstanding. (5) Represents that the percentage change is not meaningful. NM
Projected Adjusted EPS Guidance 39 Adjusted earnings per share is a non - GAAP financial measure ; however, we cannot predict with certainty the magnitude or scope of certain items that would be included in the most directly comparable GAAP measure for the relevant future periods, and such items may be significant . Due to these uncertainties, we cannot provide a quantitative reconciliation of projected adjusted EPS to the most directly comparable GAAP financial measure without unreasonable effort . However, we expect to calculate adjusted earnings per share for future periods in the same manner as the reconciliations provided for the historical periods herein .
Earnings Before Interest, Taxes, Depreciation and Amortization 40 EBITDA represents net earnings (loss) plus (i) interest expense, (ii) income tax expense and benefit, (iii) depreciation and (iv) amortization . The net earnings (loss) component of our EBITDA calculation is impacted by Certain Items that we do not consider representative of our underlying performance . As a result, in the non - GAAP reconciliations below for each period presented, adjusted EBITDA is computed as EBITDA plus the impact of Certain Items, excluding certain items related to interest expense, income taxes, depreciation and amortization . Sysco's management considers growth in this metric to be a measure of overall financial performance that provides useful information to management and investors about the profitability of the business, as it facilitates comparison of performance on a consistent basis from period to period by providing a measurement of recurring factors and trends affecting our business . Additionally, it is a commonly used component metric used to inform on capital structure decisions . Adjusted EBITDA should not be used as a substitute for the most comparable GAAP financial measure in assessing the company’s financial performance for the periods presented . An analysis of any non - GAAP financial measure should be used in conjunction with results presented in accordance with GAAP . In the tables that follow, adjusted EBITDA for each period presented is reconciled to net earnings .
Projected Adjusted EBITDA Guidance 41 Adjusted EBITDA is a non - GAAP financial measure ; however, we cannot predict with certainty the particular certain items that would be excluded from the calculation of this measure for future periods . Due to these uncertainties, we cannot provide a quantitative reconciliation of this non - GAAP financial measure to the most directly comparable GAAP financial measure without unreasonable effort . However, we expect to calculate adjusted EBITDA for future periods in the same manner as the reconciliations provided for the historical periods herein .
Sysco Corporation and its Consolidated Subsidiaries Non - GAAP Reconciliation (Unaudited) Net Debt to Adjusted EBITDA (In Millions) Net Debt to Adjusted EBITDA is a non - GAAP financial measure frequently used by investors and credit rating agencies . It is an important measure used by management to evaluate our access to liquidity, and we believe it is a representation of our financial strength . Our Net Debt to Adjusted EBITDA ratio is calculated using a numerator of our debt minus cash and cash equivalents, divided by the sum of the most recent four quarters of Adjusted EBITDA . In the table that follows, we have provided the calculation of our debt and net debt as a ratio of Adjusted EBITDA . 42 March 28, 2026 $ 1,190 Current maturities of long - term debt 12,818 Long - term debt 14,008 Total Debt (GAAP) (1,900) Cash & Cash Equivalents $ 12,108 Net Debt (Non - GAAP) $ 1,736 Net Earnings for the previous 12 months (GAAP) $ 4,327 Adjusted EBITDA for the previous 12 months (Non - GAAP) (1) 8.07 Total Debt/Net Earnings Ratio (GAAP) 3.24 Total Debt/Adjusted EBITDA Ratio (Non - GAAP) 2.80 Net Debt/Adjusted EBITDA Ratio (Non - GAAP) Refer to Impact of Certain Items on Earnings Before Interest, Taxes, Depreciation and Amortization (Trailing Twelve Months) Non - GAAP Reconciliation (1)
Sysco Corporation and its Consolidated Subsidiaries Non - GAAP Reconciliation (Unaudited) Impact of Certain Items on Earnings Before Interest, Taxes, Depreciation and Amortization (Trailing Twelve Months) (In Millions) 43 Total 13 - Week Period Ended Jun. 28, 2025 13 - Week Period Ended Sep. 27, 2025 13 - Week Period Ended Dec. 27, 2025 13 - Week Period Ended Mar. 28, 2026 $ 1,736 $ 531 $ 476 $ 389 $ 340 Net earnings (GAAP) 679 166 172 173 168 Interest (GAAP) 536 186 124 121 105 Income taxes (GAAP) 958 234 233 240 251 Depreciation and amortization (GAAP) $ 3,909 $ 1,117 $ 1,005 $ 923 $ 864 EBITDA (Non - GAAP) Certain Item adjustments: 276 74 54 55 93 Impact of restructuring, transformational project, and other costs (1) 50 3 11 23 13 Impact of acquisition - related costs (2) 92 92 — — — Impact of goodwill impairment $ 4,327 $ 1,286 $ 1,070 $ 1,001 $ 970 EBITDA adjusted for Certain Items (Non - GAAP) (3) Includes charges related to restructuring and severance, as well as various transformation initiative costs, primarily consisting of supply chain transformation costs and changes to our business technology strategy, excluding charges related to accelerated depreciation. In addition, the 13 - week period ended Mar. 28, 2026 includes charges associated with a legal matter. (1) Includes acquisition and due diligence costs. (2) In arriving at adjusted EBITDA, Sysco does not adjust out interest income of $6 million or non - cash stock compensation expense of $31 million in Q3 fiscal year 2026, interest income of $5 million or non - cash stock compensation expense of $33 million in Q2 fiscal year 2026, interest income of $6 million or non - cash stock compensation expense of $31 million in Q1 fiscal year 2026, nor interest income of $8 million or non - cash stock compensation expense of $19 million in Q4 fiscal year 2025. (3)
Sysco Corporation and its Consolidated Subsidiaries Non - GAAP Reconciliation (Unaudited) Net Debt to Adjusted EBITDA (In Millions) Net Debt to Adjusted EBITDA is a non - GAAP financial measure frequently used by investors and credit rating agencies . It is an important measure used by management to evaluate our access to liquidity, and we believe it is a representation of our financial strength . Our Net Debt to Adjusted EBITDA ratio is calculated using a numerator of our debt minus cash and cash equivalents, divided by the sum of the most recent four quarters of Adjusted EBITDA . In the table that follows, we have provided the calculation of our debt and net debt as a ratio of Adjusted EBITDA . 44 December 27, 2025 $ 1,150 Current maturities of long - term debt 12,440 Long - term debt 13,590 Total Debt (GAAP) (1,222) Cash & Cash Equivalents $ 12,368 Net Debt (Non - GAAP) $ 1,797 Net Earnings for the previous 12 months (GAAP) $ 4,326 Adjusted EBITDA for the previous 12 months (Non - GAAP) (1) 7.56 Total Debt/Net Earnings Ratio (GAAP) 3.14 Total Debt/Adjusted EBITDA Ratio (Non - GAAP) 2.86 Net Debt/Adjusted EBITDA Ratio (Non - GAAP) Refer to Impact of Certain Items on Earnings Before Interest, Taxes, Depreciation and Amortization (Trailing Twelve Months) Non - GAAP Reconciliation (1)
Sysco Corporation and its Consolidated Subsidiaries Non - GAAP Reconciliation (Unaudited) Impact of Certain Items on Earnings Before Interest, Taxes, Depreciation and Amortization (Trailing Twelve Months) (In Millions) 45 Total 13 - Week Period Ended Mar. 29, 2025 13 - Week Period Ended Jun. 28, 2025 13 - Week Period Ended Sep. 27, 2025 13 - Week Period Ended Dec. 27, 2025 $ 1,797 $ 401 $ 531 $ 476 $ 389 Net earnings (GAAP) 660 149 166 172 173 Interest (GAAP) 553 122 186 124 121 Income taxes (GAAP) 945 238 234 233 240 Depreciation and amortization (GAAP) $ 3,955 $ 910 $ 1,117 $ 1,005 $ 923 EBITDA (Non - GAAP) Certain Item adjustments: 232 49 74 54 55 Impact of restructuring and transformational project costs (1) 47 10 3 11 23 Impact of acquisition - related costs (2) 92 — 92 — — Impact of goodwill impairment $ 4,326 $ 969 $ 1,286 $ 1,070 $ 1,001 EBITDA adjusted for Certain Items (Non - GAAP) (3) Includes charges related to restructuring and severance, as well as various transformation initiative costs, primarily consisting of supply chain transformation costs and changes to our business technology strategy, excluding charges related to accelerated depreciation. (1) Includes acquisition and due diligence costs. (2) In arriving at adjusted EBITDA, Sysco does not adjust out interest income of $5 million or non - cash stock compensation expense of $33 million in Q2 fiscal year 2026, interest income of $6 million or non - cash stock compensation expense of $31 million in Q1 fiscal year 2026, interest income of $8 million or non - cash stock compensation expense of $19 million in Q4 fiscal year 2025, and interest income of $7 million or non - cash stock compensation expense of $15 million in Q3 fiscal year 2025. (2)
Net Debt to Adjusted EBITDA Leverage Ratio Targets 46 We expect to achieve our long - term net debt to adjusted EBITDA leverage ratio target . We cannot predict with certainty when we will achieve these results or whether the calculation of our EBITDA will be on an adjusted basis in future periods to exclude the effect of certain items . Due to these uncertainties, we cannot provide a quantitative reconciliation of these potentially non - GAAP measures to the most directly comparable GAAP measure without unreasonable effort . However, we expect to calculate these adjusted results, if applicable, in the same manner as the reconciliations provided for the historical periods that are presented herein . Form of calculation: Current maturities of long - term debt Long term debt Total Debt (GAAP) Less cash and cash equivalents Net Debt (Non - GAAP) Net Earnings (GAAP) Interest (GAAP) Income taxes (GAAP) Depreciation and amortization (GAAP) EBITDA (Non - GAAP) Certain item Adjustments: Impact of restructuring and transformational project costs Impact of acquisition - related intangible amortization EBITDA adjusted for Certain Items (Non - GAAP) Total Debt to Earnings Ratio (GAAP) Total Debt to Adjusted EBITDA Ratio (Non - GAAP) Net Debt to Adjusted EBITDA Ratio (Non - GAAP)
Sysco Corporation and its Consolidated Subsidiaries Non - GAAP Reconciliation (Unaudited) Adjusted EBITDA to Free Cash Flow Conversion (Trailing Twelve Months Ended Dec. 27, 2025, Dollars in Millions) EBITDA represents net earnings (loss) plus (i) interest expense, (ii) income tax expense and benefit, (iii) depreciation and (iv) amortization . The net earnings (loss) component of our EBITDA calculation is impacted by Certain Items that we do not consider representative of our underlying performance . As a result, in the non - GAAP reconciliations below for each period presented, Adjusted EBITDA is computed as EBITDA plus the impact of Certain Items, excluding certain items related to interest expense, income taxes, depreciation and amortization . In the below reconciliation, Free Cash Flow is calculated by using Adjusted EBITDA, less purchases of plant and equipment, and adding in proceeds from sales of plant and equipment . Our Adjusted EBITDA to Free Cash Flow Conversion is calculated using a numerator of Free Cash Flow divided by EBITDA Adjusted for Certain Items . In the table that follows, we have provided the calculation of Adjusted EBITDA to Free Cash Flow Conversion . 52 - Week Period Ended Dec. 27, 2025 13 - Week Period Ended Dec. 27, 2025 13 - Week Period Ended Sep. 27, 2025 13 - Week Period Ended Jun. 28, 2025 13 - Week Period Ended Mar. 29, 2025 $ 82,646 $ 20,762 $ 21,148 $ 21,138 $ 19,598 Sales (GAAP) $ 3,062 $ 692 $ 800 $ 889 $ 681 Operating Income (GAAP) $ 1,797 $ 389 $ 476 $ 531 $ 401 Net earnings (GAAP) 660 173 172 166 149 Interest (GAAP) 553 121 124 186 122 Income taxes (GAAP) 945 240 233 234 238 Depreciation and amortization (GAAP) $ 3,955 $ 923 $ 1,005 $ 1,117 $ 910 EBITDA (Non - GAAP) Certain Item adjustments: $ 232 $ 55 $ 54 $ 74 $ 49 Impact of restructuring and transformational project costs (1) 47 23 11 3 10 Impact of acquisition - related costs 92 — — 92 — Impact of goodwill impairment $ 4,326 $ 1,001 $ 1,070 $ 1,286 $ 969 EBITDA adjusted for Certain Items (Non - GAAP) (2) 52 9 28 6 9 Other expense (income), net (805) (203) (200) (197) (205) Depreciation and amortization, as adjusted (Non - GAAP) (3) $ 3,573 $ 807 $ 898 $ 1,095 $ 773 Operating income adjusted for Certain Items (Non - GAAP) 47
Sysco Corporation and its Consolidated Subsidiaries Non - GAAP Reconciliation (Unaudited) Adjusted EBITDA to Free Cash Flow Conversion (Trailing Twelve Months Ended Dec. 27, 2025, Dollars in Millions) continued 13 - Week Period Ended Mar. 29, 2025 3.5 % 4.9 % 48 13 - Week Period Ended Jun. 28, 2025 13 - Week Period Ended Sep. 27, 2025 13 - Week Period Ended Dec. 27, 2025 52 - Week Period Ended Dec. 27, 2025 Operating margin (GAAP) EBITDA margin adjusted for Certain Items (Non - GAAP) 4.2 % 6.1 % 3.8 % 5.1 % 3.3 % 4.8 % 3.7 % 5.2 % $ (873) $ (140) $ (160) $ (374) $ (199) Additions to plant and equipment 150 78 24 45 3 Proceeds from sales of plant and equipment (723) $ (62) $ (136) $ (329) $ $ (196) Capex (Non - GAAP) $ 3,603 939 $ 934 $ 957 $ 773 $ Free Cash Flow (Adj. EBITDA minus Capex, Non - GAAP) 83.3 93.8 % 87.3 % 74.4 % 79.8 % Free Cash Flow Conversion (Free Cash Flow divided by EBITDA, Non - GAAP) % Fiscal 2026 and fiscal 2025 include charges related to restructuring and severance, as well as various transformation initiative costs, primarily consisting of supply chain transformation costs and changes to our business technology strategy, excluding charges related to accelerated depreciation. (1) In arriving at adjusted EBITDA, Sysco does not adjust out interest income of $5 million or non - cash stock compensation expense of $33 million in Q2 fiscal 2026, interest income of $6 million or non - cash stock compensation expense of $31 million in Q1 fiscal 2026, interest income of $8 million or non - cash stock compensation expense of $19 million in Q4 fiscal 2025, and interest income of $7 million or non - cash stock compensation expense of $15 million in Q3 fiscal 2025. (2) Q 2 fiscal 2026 includes $ 240 million in GAAP depreciation and amortization expense, less $ 37 million of Non - GAAP depreciation and amortization expense primarily related to acquisitions . Q 1 fiscal 2026 includes $ 233 million in GAAP depreciation and amortization expense, less $ 33 million of Non - GAAP depreciation and amortization expense primarily related to acquisitions . Q 4 fiscal 2025 includes $ 234 million in GAAP depreciation and amortization expense, less $ 37 million of Non - GAAP depreciation and amortization expense primarily related to acquisitions . Q 3 fiscal 2025 includes $ 238 million in GAAP depreciation and amortization expense, less $ 33 million of Non - GAAP depreciation and amortization expense primarily related to acquisitions . (3)
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