Sysco Corp. shares
SYY,
sank 7.2% in premarket trading Tuesday, after the food products distributor reported fiscal second-quarter profit that came up short of expectations, as the COVID environment led to higher-than-anticipated operating costs. From $67.3 million (13 cents per share) in the previous year, net income for the quarter ended January 1st more than doubled, to $164.4million, or 33cs per share. Adjusted earnings per share fell to 57c, below the FactSet consensus figure of 70c. Sales rose 41.2%, to $16.32billion, exceeding the FactSet consensus at $15.89billion. However, cost of sales increased 41.9%, to $13.43billion, as gross margin fell to 17.7% from 18.2%. Chief Executive Kevin Hourican said that the omicron variation is currently impacting customers and affecting their top-line as well as hours of operations. “The COVID effect is felt at Sysco in our operations productivity performance with a higher than normal cost-to-serve.” The stock has dropped 0.6% over the past three month, Monday through Monday, according to the S&P 500.
SPX,
has lost 4.6%.
Sysco stock falls as profits miss expectations due to lower costs in the COVID environment
