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Financial Analysis About Sysco Corporation

Essay by   •  February 29, 2012  •  Case Study  •  627 Words (3 Pages)  •  1,757 Views

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Financial Analysis about Sysco Corporation

Sysco Corporation is the world's largest broad line food distributor. This corporation commits itself to the marketing and distribution of a range of food and related products primarily to the foodservice or food-away-from-home industry. Today, Sysco has sales and service relationships with approximately 400,000 customers and operated almost 180 distribution facilities in the United States, Canada, and Ireland (Sysco corporation website). Sysco keeps growth steadily from it establishes until now, and it still pursuits committed to helping them succeed in the foodservice industry and satisfy consumers' appetites.

According to Sysco Corporation's income statement, Sysco Corporation's profit grows from $7,107,486,000 to $7,321,148,000 over the latest two years. The company's sales were $39.3 billion in fiscal 2011. It sales growth rate is approximately 5.56% from 2010 to 2011. The profit margin on Dec, 2011 was 2.93% comparing with 3.17% on Dec, 2010. It is clearly to see that the profit margin of Sysco Corporation is falling from 2010 to 2011. Furthermore, the ROA of this company was approximately 10.33% at the end of 2011, which is less than 11.01% at the end of 2010. The same as ROA, the company's ROE was 25.79% at the end of 2011, a decrease of3.12% from the comparable prior year period (calculate based on Exhibits 1). Based on the Yahoo! Finance, the Sysco Corporation's profit ability is greater than the other companies in the food wholesale industry, such as U.S. Foodservice, Inc, Performance Food Group Company, and Meadowbrook Meat Company, Inc ("Yahoo! Finance).

Based on analyze the balance sheet of the Sysco Corporation, the company's biggest asset is "property plant and equipment". The asset of "property plant and equipment" takes 30.93% of its total assets in 2011, comparing with 31.06% in 2010. Sysco Corporation needs to invest lots of plants and equipments in order to expand and take more market shares in the future. The assets of this company main includes that short term investments, cash and cash equivalents, net receivables , inventory, property plant and equipment, goodwill, and intangible assets. The net receivables, property plant and equipment, and inventory are big part in its total assets. Property plant and equipment asset is the biggest part in its total assets both in 2010 and 2011, which takes 30.93% in 2011 and 31.06% in 2010. Net receivable asset takes 25.38% of its total assets as the second one in 2010, and increase to 25.46% in 2011. The proportion of inventory assets was from 17.18% to 18.21% over the latest two years. The Sysco Corporation's total fixed assets are $5,652,673,000 which takes 49.65% of its total assets in 2011. The fixed assets in 2010 are $5,237,443,000 which takes 50.78% in 2010. By companion, it has been found that the proportion of

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