Sysco Cuts Jobs, Furloughs Workers as Coronavirus Pinches Sales
March 30 2020 - 09:00AM
Dow Jones News
By Micah Maidenberg
Sysco Corp. warned the coronavirus pandemic will hit sales and
said it is cutting costs as restaurant customers struggle with
limited operations.
The food distributor on Monday warned in a filing it will see a
decrease in sales, characterizing the decline as short term. To
respond, Sysco over the past two weeks has cut jobs, implemented
hiring freezes and furloughed employees, the company said.
Sysco also has carried out what it termed significant reductions
in capital spending, suspended its share buyback program and
borrowed $1.6 billion under a $2 billion credit line in order to
strengthen its liquidity position, the company said.
Houston-based Sysco said it is looking for new business with
customers like retailers, who have seen a surge in demand as
consumers purchase more groceries as they stay in large part at
home to avoid the coronavirus and help halt its spread.
But the distributor also has a major business servicing
restaurants, many of which are only offering delivery,
drive-through meals and take out to comply with government
restrictions. That has hurt demand for its food among chains and
indepedent operators.
Sysco also said Monday it is working to prepare "for the
eventual return of demand for food-away-from-home."
Write to Micah Maidenberg at micah.maidenberg@wsj.com
(END) Dow Jones Newswires
March 30, 2020 08:45 ET (12:45 GMT)
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