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BUSINESS SEGMENT INFORMATION | 12 Months Ended
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Jul. 01, 2017
Segment Reporting [Abstract] |
BUSINESS SEGMENT INFORMATION | BUSINESS SEGMENT INFORMATION The Acquisition, combined with a change in how the chief operating decision maker assesses performance and allocates resources, resulted in a change in Sysco’s segment reporting in the first quarter of fiscal 2017. Sysco has aggregated certain of its operating companies into three reportable segments. “Other” financial information is attributable to the company’s other operating segments that do not meet the quantitative disclosure thresholds.
• | U.S. Foodservice Operations - primarily includes U.S. Broadline operations, custom-cut meat and seafood companies, FreshPoint (our specialty produce companies) and European Imports (a specialty import company);
• | International Foodservice Operations - primarily includes broadline operations in Canada and Europe (including the Brakes Group, which was acquired in fiscal 2017), Bahamas, Mexico, Costa Rica and Panama, as well as a company that distributes to international customers;
• | SYGMA - our customized distribution subsidiary; and
• | Other - primarily our hotel supply operations and Sysco Labs, which includes our suite of technology solutions that help support the business needs of our customers and provides support for some of our business technology needs.
Broadline operating companies distribute a full line of food products and a wide variety of non-food products to both traditional and chain restaurant customers, hospitals, schools, hotels, industrial caterers and other venues where foodservice products are served. SYGMA operating companies distribute a full line of food products and a wide variety of non-food products to certain chain restaurant customer locations. The accounting policies for the segments are the same as those disclosed by Sysco for its consolidated financial statements. Management evaluates the performance of each of our operating segments based on its respective operating income results. Corporate expenses generally include all expenses of the corporate office and Sysco’s shared services center. These also include all share-based compensation costs. While a segment’s operating income may be impacted in the short-term by increases or decreases in gross profits, expenses, or a combination thereof, over the long-term each business segment is expected to increase its operating income at a greater rate than sales growth. This is consistent with our long-term goal of leveraging earnings growth at a greater rate than sales growth. The following tables set forth certain financial information for Sysco’s business segments. Prior year amounts have been reclassified to conform to the current year presentation and include the impact of a change in allocation between corporate and these segments that is not material but is consistent with management’s assessment of segment performance in fiscal 2017.
| Fiscal Year
| 2017 |  | 2016 |  | 2015
Sales: | (In thousands)
U.S. Foodservice Operations | $ | 37,604,698 |  |  | $ | 37,776,443 |  |  | $ | 36,098,977 |
International Foodservice Operations (1) | 10,613,059 |  |  | 5,436,209 |  |  | 5,592,137 |
SYGMA | 6,178,909 |  |  | 6,102,328 |  |  | 6,076,215 |
Other | 974,473 |  |  | 1,051,939 |  |  | 913,423 |
Total | $ | 55,371,139 |  |  | $ | 50,366,919 |  |  | $ | 48,680,752 |
Operating income: |  |  |  |  |
U.S. Foodservice Operations | $ | 2,891,612 |  |  | $ | 2,771,932 |  |  | $ | 2,493,210 |
International Foodservice Operations (1) | 243,116 |  |  | 177,159 |  |  | 170,913 |
SYGMA | 23,299 |  |  | 27,469 |  |  | 20,381 |
Other | 20,279 |  |  | 32,586 |  |  | 26,596 |
Total segments | 3,178,306 |  |  | 3,009,146 |  |  | 2,711,100 |
Corporate expenses | (1,125,135 | ) |  | (1,158,646 | ) |  | (1,481,738 | )
Total operating income | 2,053,171 |  |  | 1,850,500 |  |  | 1,229,362 |
Interest expense | 302,878 |  |  | 306,146 |  |  | 254,807 |
Other expense (income), net | (15,937 | ) |  | 111,347 |  |  | (33,592 | )
Earnings before income taxes | $ | 1,766,230 |  |  | $ | 1,433,007 |  |  | $ | 1,008,147 |
Depreciation and amortization: |  |  |  |  |
U.S. Foodservice Operations | $ | 266,024 |  |  | $ | 252,392 |  |  | $ | 260,021 |
International Foodservice Operations (1) | 243,628 |  |  | 70,184 |  |  | 63,037 |
SYGMA | 34,890 |  |  | 31,792 |  |  | 29,753 |
Other | 10,678 |  |  | 12,450 |  |  | 9,581 |
Total segments | 555,220 |  |  | 366,818 |  |  | 362,392 |
Corporate | 346,772 |  |  | 295,892 |  |  | 190,629 |
Total | $ | 901,992 |  |  | $ | 662,710 |  |  | $ | 553,021 |
Capital Expenditures: |  |  |  |  |
U.S. Foodservice Operations | $ | 194,714 |  |  | $ | 153,528 |  |  | $ | 184,567 |
International Foodservice Operations (1) | 228,564 |  |  | 56,689 |  |  | 80,170 |
SYGMA | 50,722 |  |  | 31,811 |  |  | 36,948 |
Other | 13,237 |  |  | 20,702 |  |  | 4,287 |
Total segments | 487,237 |  |  | 262,730 |  |  | 305,972 |
Corporate | 199,141 |  |  | 264,616 |  |  | 236,858 |
Total | $ | 686,378 |  |  | $ | 527,346 |  |  | $ | 542,830 |
| Fiscal Year
| 2017 |  | 2016 |  | 2015
Assets: | (In thousands)
U.S. Foodservice Operations | $ | 6,675,543 |  |  | $ | 6,753,056 |  |  | $ | 6,772,270 |
International Foodservice Operations (1) | 6,433,815 |  |  | 2,019,406 |  |  | 1,915,011 |
SYGMA | 625,653 |  |  | 539,639 |  |  | 510,626 |
Other | 448,885 |  |  | 459,785 |  |  | 327,691 |
Total segments | 14,183,896 |  |  | 9,771,886 |  |  | 9,525,598 |
Corporate | 3,572,759 |  |  | 6,949,918 |  |  | 8,463,683 |
Total | $ | 17,756,655 |  |  | $ | 16,721,804 |  |  | $ | 17,989,281 |
(1) | Amounts are impacted by changes in exchange rates used to translate foreign results into U.S. dollars.
The sales mix for the principal product categories for each fiscal year is as follows:
| Fiscal Year
| 2017 |  | 2016 |  | 2015
| (In thousands)
Fresh and frozen meats | $ | 10,605,678 |  |  | $ | 10,273,247 |  |  | $ | 10,080,290 |
Canned and dry products | 8,695,829 |  |  | 8,402,230 |  |  | 7,999,250 |
Frozen fruits, vegetables, bakery and other | 8,444,260 |  |  | 6,719,648 |  |  | 6,339,537 |
Poultry | 5,873,944 |  |  | 5,392,933 |  |  | 5,189,496 |
Dairy products | 5,610,101 |  |  | 5,276,991 |  |  | 5,199,036 |
Fresh produce | 4,701,440 |  |  | 4,156,978 |  |  | 3,828,298 |
Paper and disposables | 3,596,470 |  |  | 3,557,514 |  |  | 3,507,007 |
Seafood | 3,089,350 |  |  | 2,541,239 |  |  | 2,490,523 |
Beverage products | 2,059,453 |  |  | 1,849,780 |  |  | 1,754,944 |
Janitorial products | 1,331,019 |  |  | 1,251,821 |  |  | 1,102,855 |
Equipment and smallwares | 794,087 |  |  | 593,595 |  |  | 661,254 |
Medical supplies | 569,508 |  |  | 350,943 |  |  | 528,262 |
Total | $ | 55,371,139 |  |  | $ | 50,366,919 |  |  | $ | 48,680,752 |
Information concerning geographic areas is as follows:
| Fiscal Year
| 2017 |  | 2016 |  | 2015
| (In thousands)
Sales: |  |  |  |  |
United States | $ | 44,395,765 |  |  | $ | 44,922,937 |  |  | $ | 43,146,591 |
Canada | 4,346,894 |  |  | 4,486,282 |  |  | 4,727,742 |
United Kingdom | 2,974,133 |  |  | — |  |  | — |
France | 1,426,973 |  |  | — |  |  | — |
Other | 2,227,374 |  |  | 957,700 |  |  | 806,419 |
Total | $ | 55,371,139 |  |  | $ | 50,366,919 |  |  | $ | 48,680,752 |
Long-lived assets: |  |  |  |  |  |  |  |
United States | $ | 3,252,980 |  |  | $ | 3,461,505 |  |  | $ | 3,519,610 |
Canada | 329,090 |  |  | 309,027 |  |  | 317,231 |
United Kingdom | 303,178 |  |  | — |  |  | — |
France | 284,611 |  |  | — |  |  | — |
Other | 207,443 |  |  | 109,910 |  |  | 145,302 |
Total | $ | 4,377,302 |  |  | $ | 3,880,442 |  |  | $ | 3,982,143 |

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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