Food distributor has healthier options
Sysco rose through the ranks to score the No. 5 spot on the Chronicle’s list of the area’s top companies, up from No. 12 in 2015.
The food distribution giant made progress on a three-year plan to increase profits, improve customer relationships and expand its operations after a costly failed merger with US Foods. It brought in nearly $53.1 billion in revenue in 2016, up 8.6 percent from 2015.
The company, which operates on an atypical fiscal calendar, posted higher sales each quarter last year. Profit rose from $686.7 million in fiscal year 2015 to $949.6 million in fiscal year 2016, which ended last summer.
Sysco’s proposed merger with US Foods fizzled during the summer of 2015 and required the company to pay $312 million in fees on top of the hundreds of millions it had already invested in crafting the deal. A few months later, the company announced its three-year plan to cut costs and boost operating income by at least $500 million by the end of 2018, among other things.
In 2016, the company focused on improving productivity and offering healthier and more convenient options in response to customer demand, said Joel Grade, the company’s CFO and executive vice president.
It also refined its recruitment and training approaches. The company has about 65,000 employees, including 3,000 in Houston.
“We’re very pleased with the progress we made,” Grade said. “All that, we believe, will translate into our financial objectives and our operating income targets.”
The company also expanded its global operations, which cover areas from South America to Europe, by acquiring the London-based Brakes Group, a European food-service business, for roughly $3.1 billion last summer.
“This acquisition significantly strengthens our position as the world’s leading food service distributor,” Grade said.