HOUSTON (AP) -- Food distributor Sysco Corp.'s fiscal second-quarter net income dropped 11.6 percent as it continued to sustain heavy costs aimed at turning around its business.
The company, which sells food to restaurants, hotels, schools and other customers, is involved in a multiyear process to reshape its business. It struggled with weaker sales and higher expenses coming out of the recession as customers cut back on spending and food costs soared. The company has cut costs, trimmed jobs and closed some facilities to improve its profitability since then.
Sysco said it was hurt in the fiscal quarter ended Dec. 29 by Superstorm Sandy, which struck the Northeast on Oct. 29.
Houston-based Sysco reported Monday that it earned $221 million, or 38 cents a share, in the second quarter. That was down from $250 million, or 43 cents a share, in the same quarter of 2011.
Expenses rose 8.2 percent to $116 million. The company attributed the jump largely to a $45 million increase in business turnaround costs and a $17 million rise in payroll expenses.
Excluding one-time costs, Sysco's earnings were 40 cents per share. Analysts polled by FactSet expected 41 cents.
Second-quarter revenue increased 5.4 percent to $10.8 billion, a level which the company said was its highest ever for a second quarter. Analysts expected $10.7 billion. Sysco said revenue was boosted by sales from acquisitions. The company has been aiming to increase revenue by acquiring smaller companies.
Sysco shares fell $1.32, or 4.1 percent, to $39.77 in morning trading.
- Investment & Company Information