Sysco Earnings Call Insights: The Rollout Schedule and ERP Implementation

Sysco Corporation (NYSE:SYY) recently reported its second quarter earnings and discussed the following topics in its earnings conference call.

The Rollout Schedule

John Heinbockel – Guggenheim Securities: Couple of things. Is there any update on either the rollout schedule, where you expect to be by fiscal year-end in terms of OpCo’s or the benefit because I think you said 25% of the ultimate benefit would be seen this year, is there any update on either one of those?

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William J. DeLaney – President and CEO: John, no, I don’t have an update for you this morning. What we were telling you I think in our prepared comments is we are in a somewhat of a delay here from what we originally anticipated in terms of rollouts and we are going to take the next few weeks to continue to assess the things we need to improve in terms of the functionality of the system, I think, over the next month or two we should have an update on the rollout timeline. As far as the 25% of the benefits, I want to just keep reminding everybody and I’ll let Chris speak to this because he is the one that’s really managing this very well. That is off of a overall targeted savings of $600 million give or take over a three-year period which incorporates not just a technology side of it, but some big initiatives we have going on which Chris referenced in detail here today on the SG&A side of the business as well as the product cost side of the business. So, I think we’re in a pretty good place there and I’ll let Chris provide some color for you.

R. Chris Kreidler – EVP and CFO: Yeah, John. With regards to the both parts of your question on the rollout plan I won’t add any color to what Bill said, other than the guidance that we have out there right now is 5 to 15 operating companies being converted this year. I think it’s fair to say we’re going to be at the lower end of that range. But as Bill said, we’re working through whatever revisions we might need to make to our plans right now, but that’s the current guidance. On the savings, again, as Bill said, it’s across all of our business transformation initiatives, I’ll kind of walk you through where we’ve made progress on many of the others and frankly we feel pretty good about where we are on our overall cost saving initiatives for this year as well as going forward.

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