Sysco 2Q17 Earnings Call Notes

William DeLaney – Chief Executive Officer

Transition from deflation to inflation has been a little more rapid than normal

“When you have an inflationary period and where that overall inflation is in the 2% to 3% area, it’s usually at a level just for the customer in a particular restaurant were able to pass along. So generally a 2% rate is a kind of sweet spot for our customers and not a huge challenge for us; now we did point here earlier that the transition from deflation to inflation has been a little more rapid than normal, and there are certainly some categories where we are seeing more than 2% to 3% inflation. So that becomes a challenge both in terms of how we work with our customers and they work with their patrons, but I wouldn’t say we are seeing anything out there today that would be overly difficult for our customers to pass along.”

First opportunity to use new management tools in an inflationary environment

“And look, I think that’s a really key point, we continue to make it – we are going to be going through and we are in the midst of going through transition now in this environment and our revenue management tools, this will be the first time that we have really utilized those in an inflation environment.”

I wouldn’t get overly excited about a couple months of weak restaurant data

“So, I don’t know that I would get overly excited about one or two months of data, it’s somewhat mixed out there. Consumer confidence is positive for the most part our restaurant operators and customer feel good about the business not quite, maybe is feasibly good as they were a few months ago, but my experience tells me that these numbers move around and they are still very much on a range that as I said earlier it translates to go to the industry and that’s certainly good for us.”