Sysco 2010 Annual Report Download - page 74
Download and view the complete annual report
Please find page 74 of the 2010 Sysco annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.Sysco’s Industrial Revenue Bonds have varying structures. Final maturities range from one to 16 years and certain of the bonds provide Sysco the
right to redeem the bonds at various dates.These redemption provisions generally provide the bondholder a premium in the early redemption years,
declining to par value as the bonds approach maturity.
Total Debt
Total debt as of July 3, 2010 was $2,480.6 million of which approximately 81% was at fixed rates with a weighted average of 5.9% and an
average life of 16 years, and the remainder was at floating rates with a weighted average of 2.3%. Certain loan agreements contain typical debt
covenants to protect note holders, including provisions to maintain the company’s long-term debt to total capital ratio below a specified level. Sysco
was in compliance with all debt covenants as of July 3, 2010.
Other
As of July 3, 2010 and June 27, 2009 letters of credit outstanding were $28.4 million and $74.7 million, respectively.
11. LEASES
Sysco has obligations under capital and operating leases for certain distribution facilities, vehicles and computers. Total rental expense under
operating leases was $80.7 million, $83.7 million, and $95.3 million in fiscal 2010, 2009 and 2008, respectively. Contingent rentals, subleases and
assets and obligations under capital leases are not significant.
Aggregate minimum lease payments by fiscal year under existing non-capitalized long-term leases are as follows:
Amount
(In thousands)
2011 ................................................................................. $ 48,845
2012 ................................................................................. 38,097
2013 ................................................................................. 29,315
2014 ................................................................................. 22,727
2015 ................................................................................. 18,606
Thereafter . . . .......................................................................... 55,056
12. EMPLOYEE BENEFIT PLANS
Sysco has defined benefit and defined contribution retirement plans for its employees. Also, the company contributes to various multi-employer
plans under collective bargaining agreements and provides certain health care benefits to eligible retirees and their dependents.
Sysco maintains a qualified pension plan (Retirement Plan) that pays benefits to employees at retirement, using formulas based on a
participant’s years of service and compensation.
The company’s defined contribution 401(k) plan provides that under certain circumstances the company may make matching contributions of
up to 50% of the first 6% of a participant’s compensation. Sysco’s expense related to this plan was $22.8 million in fiscal 2010, $30.2 million in fiscal
2009, and $36.2 million in fiscal 2008.
Sysco’s contributions to multi-employer pension plans, which include payments for voluntary withdrawals, were $51.5 million, $48.0 million,
and $36.9 million in fiscal 2010, 2009 and 2008, respectively. Payments for voluntary withdrawals included in contributions were approximately
$17.4 million and $15.0 million in fiscal 2010 and fiscal 2009, respectively. See further discussion of Sysco’s participation in multi-employer pension
plans in Note 18, “Commitments and Contingencies.”
In addition to receiving benefits upon retirement under the company’s Retirement Plan, participants in the Management Incentive Plan (see
“Management Incentive Compensation”in Note 15, “Share-Based Compensation”) will receive benefits under a Supplemental Executive Retirement
Plan (SERP). This plan is a nonqualified, unfunded supplementary retirement plan.
50