10-Q

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

þ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 29, 2007

OR

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                     

Commission file number 1-6544

SYSCO CORPORATION

(Exact name of registrant as specified in its charter)

Delaware	74-1648137
(State or other jurisdiction of incorporation or organization)	(IRS employer identification number)

1390 Enclave Parkway
Houston, Texas 77077-2099
(Address of principal executive offices)
(Zip code)

Registrant’s telephone number, including area code: (281) 584-1390

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes þ      No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):

Large Accelerated Filer þ      Accelerated Filer o      Non-accelerated Filer o

Indicate by check mark whether the registrant is a shell company (as defined by Rule 12b-2 of the Exchange Act.)

Yes o      No þ

608,160,405 shares of common stock were outstanding as of October 27, 2007.

TABLE OF CONTENTS

	Page No.
Part I. Financial Information
Item 1. Financial Statements		1
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		16
Item 3. Quantitative and Qualitative Disclosures about Market Risk		26
Item 4. Controls and Procedures		27
Part II. Other Information
Item 1. Legal Proceedings		28
Item 1A. Risk Factors		28
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		28
Item 3. Defaults Upon Senior Securities		29
Item 4. Submission of Matters to a Vote of Security Holders		29
Item 5. Other Information		29
Item 6. Exhibits		29
Signatures		32
Form of Commitment Increase Agreement
Form of Extension Agreement
Third Amendment to Sixth Amended Supplemental Executive Retirement Plan
Form of Performance Unit Grant Agreement
Report from Ernst & Young LLP
Acknowledgement Letter from Ernst & Young LLP
Certification of CEO Pursuant to Section 302
Certification of CFO Pursuant to Section 302
Certification of CEO Pursuant to Section 906
Certification of CFO Pursuant to Section 906

1

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

SYSCO CORPORATION and its Consolidated Subsidiaries
CONSOLIDATED BALANCE SHEETS
(In Thousands Except for Share Data)

	Sept. 29, 2007		June 30, 2007			Sept. 30, 2006
	(unaudited)					(unaudited)
ASSETS
Current assets
Cash	$	190,154	$	207,872		$	180,721
Accounts and notes receivable, less allowances of $42,953, $31,841 and $41,432		2,765,213		2,610,885			2,636,834
Inventories		1,865,355		1,714,187			1,715,608
Deferred taxes		91,444		—			87,292
Prepaid expenses and other current assets		117,661		123,284			74,735
Prepaid income taxes		—		19,318			—
Total current assets		5,029,827		4,675,546			4,695,190
Plant and equipment at cost, less depreciation		2,780,780		2,721,233			2,486,301
Other assets
Goodwill		1,394,814		1,355,313			1,329,782
Intangibles, less amortization		90,393		91,366			96,136
Restricted cash		99,755		101,929			111,673
Prepaid pension cost		389,720		352,390			400,049
Other assets		232,655		221,154			242,959
Total other assets		2,207,337		2,122,152			2,180,599
Total assets	$	10,017,944	$	9,518,931		$	9,362,090
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Notes payable	$	2,700	$	18,900		$	6,000
Accounts payable		2,079,131		1,981,190			1,913,688
Accrued expenses		779,968		922,582			694,069
Accrued income taxes		509,370		—			480,775
Deferred taxes		—		488,849			—
Current maturities of long-term debt		3,576		3,568			106,933
Total current liabilities		3,374,745		3,415,089			3,201,465
Other liabilities
Long-term debt		1,969,804		1,758,227			1,738,858
Deferred taxes		734,169		626,695			861,776
Other long-term liabilities		641,771		440,520			372,149
Total other liabilities		3,345,744		2,825,442			2,972,783
Commitments and contingencies
Shareholders’ equity
Preferred stock, par value $1 per share Authorized 1,500,000 shares, issued none		—		—			—
Common stock, par value $1 per share Authorized 2,000,000,000 shares, issued 765,174,900 shares		765,175		765,175			765,175
Paid-in capital		655,609		637,154			555,409
Retained earnings		5,600,065		5,544,078			5,124,362
Accumulated other comprehensive income (loss)		61,218		(4,061	)		84,171
		7,082,067		6,942,346			6,529,117
Less cost of treasury stock, 156,256,910, 153,334,523 and 146,144,059 shares		3,784,612		3,663,946			3,341,275
Total shareholders’ equity		3,297,455		3,278,400			3,187,842
Total liabilities and shareholders’ equity	$	10,017,944	$	9,518,931		$	9,362,090

Note: The June 30, 2007 balance sheet has been derived from the audited financial statements at that date.

See Notes to Consolidated Financial Statements

2

SYSCO CORPORATION and its Consolidated Subsidiaries
CONSOLIDATED RESULTS OF OPERATIONS (Unaudited)
(In Thousands Except for Share and Per Share Data)

	13-Week Period Ended
	Sept. 29, 2007			Sept. 30, 2006
Sales	$	9,405,844		$	8,672,072
Cost of sales		7,614,702			7,002,856
Gross margin		1,791,142			1,669,216
Operating expenses		1,336,509			1,276,882
Operating income		454,633			392,334
Interest expense		26,371			25,766
Other income, net		(3,032	)		(9,038	)
Earnings before income taxes		431,294			375,606
Income taxes		164,305			145,458
Net earnings	$	266,989		$	230,148
Net earnings:
Basic earnings per share	$	0.44		$	0.37
Diluted earnings per share		0.43			0.37
Average shares outstanding		610,810,914			620,127,064
Diluted shares outstanding		617,108,313			625,486,950
Dividends declared per common share	$	0.19		$	0.17

See Notes to Consolidated Financial Statements

3

SYSCO CORPORATION and its Consolidated Subsidiaries
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited)
(In Thousands)

	13-Week Period Ended
	Sept. 29, 2007		Sept. 30, 2006
Net earnings	$	266,989	$	230,148
Other comprehensive income, net of tax:
Foreign currency translation adjustment		40,925		(554	)
Amortization of cash flow hedge		106		107
Amortization of unrecognized prior service cost		944		—
Amortization of unrecognized actuarial losses (gains), net		501		—
Amortization of unrecognized transition obligation		23		—
Total other comprehensive income (loss)		42,499		(447	)
Comprehensive income	$	309,488	$	229,701

See Notes to Consolidated Financial Statements

4

SYSCO CORPORATION and its Consolidated Subsidiaries
CONSOLIDATED CASH FLOWS (Unaudited)
(In Thousands)

	13-Week Period Ended
	Sept. 29, 2007			Sept. 30, 2006
Operating activities:
Net earnings	$	266,989		$	230,148
Adjustments to reconcile net earnings to cash provided by operating activities:
Share-based compensation expense		15,193			31,481
Depreciation and amortization		90,456			90,060
Deferred tax provision		155,164			133,866
Provision for losses on receivables		7,281			8,915
(Gain) on sale of assets		(202	)		(5,452	)
Additional investment in certain assets and liabilities, net of effect of businesses acquired:
(Increase) in receivables		(144,184	)		(151,316	)
(Increase) in inventories		(138,237	)		(104,342	)
Decrease (increase) in prepaid expenses and other current assets		6,027			(15,588	)
Increase in accounts payable		83,871			27,364
(Decrease) in accrued expenses		(131,699	)		(55,564	)
(Decrease) in accrued income taxes		(16,103	)		(4,596	)
(Increase) in other assets		(10,679	)		(6,905	)
Increase (decrease) in other long-term liabilities and prepaid pension cost, net		10,672			(2,112	)
Excess tax benefits from share-based compensation arrangements		(2,783	)		(2,776	)
Net cash provided by operating activities		191,766			173,183
Investing activities:
Additions to plant and equipment		(131,543	)		(115,879	)
Proceeds from sales of plant and equipment		1,071			10,252
Acquisition of businesses, net of cash acquired		(25,750	)		(43,443	)
Decrease (increase) in restricted cash		2,174			(11,899	)
Net cash used for investing activities		(154,048	)		(160,969	)
Financing activities:
Bank and commercial paper borrowings (repayments), net		194,120			90,544
Other debt borrowings		771			831
Other debt repayments		(880	)		(2,152	)
Common stock reissued from treasury		52,842			45,186
Treasury stock purchases		(189,484	)		(65,281	)
Dividends paid		(116,339	)		(105,233	)
Excess tax benefits from share-based compensation arrangements		2,783			2,776
Net cash used for financing activities		(56,187	)		(33,329	)
Effect of exchange rates on cash		751			(61	)
Net decrease in cash		(17,718	)		(21,176	)
Cash at beginning of period		207,872			201,897
Cash at end of period	$	190,154		$	180,721
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest	$	35,161		$	32,816
Income taxes		19,834			15,658

See Notes to Consolidated Financial Statements

5

SYSCO CORPORATION and its Consolidated Subsidiaries
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

1.	Basis of Presentation
	The consolidated financial statements have been prepared by the company, without audit, with the exception of the June 30, 2007 consolidated balance sheet, which was taken from the audited financial statements included in the company’s Fiscal 2007 Annual Report on Form 10-K. The financial statements include consolidated balance sheets, consolidated results of operations, consolidated statements of comprehensive income and consolidated cash flows. Certain amounts in the prior periods presented have been reclassified to conform to the fiscal 2008 presentation. In the opinion of management, all adjustments, which consist of normal recurring adjustments, necessary to present fairly the financial position, results of operations, comprehensive income and cash flows for all periods presented have been made.
	These financial statements should be read in conjunction with the audited financial statements and notes thereto included in the company’s Fiscal 2007 Annual Report on Form 10-K.
	A review of the financial information herein has been made by Ernst & Young LLP, independent auditors, in accordance with established professional standards and procedures for such a review. A report from Ernst & Young LLP concerning their review is included as Exhibit 15.1.
2.	Changes in Accounting
	SFAS 158
	As of June 30, 2007, SYSCO early adopted the measurement date provision of FASB Statement No. 158, “Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans – an amendment of FASB Statements No. 87, 88, 106, and 132(R)” (SFAS 158). The measurement date provision requires an employer to measure a plan’s assets and obligations as of the end of the employer’s fiscal year. As a result, beginning in fiscal 2008, the measurement date for SYSCO’s defined benefit pension and other post-retirement plans will correspond with fiscal year-end rather than the May 31st measurement date previously used. The company performed measurements as of May 31, 2007 and June 30, 2007 of the plan assets and benefit obligations. SYSCO recorded a charge to beginning retained earnings on July 1, 2007 of $3,572,000, net of tax, for the impact of the difference in our pension expense between the two measurement dates. The company also recorded a benefit to beginning accumulated other comprehensive income (loss) on July 1, 2007 of $22,780,000, net of tax, for the impact of the difference in the recognition provision between the two measurement dates.
	FIN 48
	Effective July 1, 2007, SYSCO adopted FASB Interpretation No. 48, “Accounting for Uncertainty in Income Taxes – an Interpretation of FASB Statement No. 109” (FIN 48), which clarifies the accounting for uncertainty in income taxes recognized in accordance with FASB Statement No. 109 (SFAS 109). FIN 48 clarifies the application of SFAS 109 by defining criteria that an individual tax position must meet for any part of the benefit of that position to be recognized in the financial statements. Additionally, FIN 48 provides guidance on the measurement, derecognition, classification and disclosure of tax positions, along with accounting for the related interest and penalties. The impact of adopting this standard is discussed in Note 8, Income Taxes.

6

3.	Restricted Cash
	SYSCO is required by its insurers to collateralize a part of the self-insured portion of its workers’ compensation and liability claims. SYSCO has chosen to satisfy these collateral requirements by depositing funds in insurance trusts or by issuing letters of credit.
	In addition, for certain acquisitions, SYSCO has placed funds into escrow to be disbursed to the sellers in the event that specified operating results are attained or contingencies are resolved.
	A summary of restricted cash balances appears below:

	Sept. 29, 2007		June 30, 2007		Sept. 30, 2006
Funds deposited in insurance trusts	$	90,755,000	$	92,929,000	$	90,553,000
Escrow funds related to acquisitions		9,000,000		9,000,000		21,120,000
Total	$	99,755,000	$	101,929,000	$	111,673,000

4.	Debt
	In September 2007, an agreement was signed on the revolving credit facility supporting the company’s U.S. and Canadian commercial paper programs, which increased the facility amount to $1,000,000,000. In addition, the termination date on the facility was extended from November 4, 2011 to November 4, 2012 in accordance with the terms of the agreement.
	As of September 29, 2007, SYSCO had uncommitted bank lines of credit which provide for unsecured borrowings for working capital of up to $145,000,000, of which $2,700,000 was outstanding as of September 29, 2007.
	As of September 29, 2007, SYSCO’s outstanding commercial paper issuances were $742,146,000 and were classified as long-term debt since the company’s commercial paper programs are supported by its long-term revolving credit facility in the amount of $1,000,000,000.
	During the 13-week period ended September 29, 2007, commercial paper issuances and short-term bank borrowings ranged from approximately $532,045,000 to $865,424,000.
5.	Employee Benefit Plans
	The components of net pension costs for the 13-week periods presented are as follows:

	Pension Benefits						Other Postretirement Plans
	Sept. 29, 2007			Sept. 30, 2006			Sept. 29, 2007			Sept. 30, 2006
Service cost	$	22,643,000		$	21,164,000		$	121,000		$	113,000
Interest cost		25,305,000			22,829,000			142,000			133,000
Expected return on plan assets		(33,836,000	)		(29,186,000	)		—			—
Amortization of prior service cost		1,496,000			1,420,000			36,000			50,000
Recognized net actuarial loss (gain)		852,000			2,422,000			(39,000	)		(33,000	)
Amortization of net transition obligation		—			—			38,000			38,000
Net pension costs	$	16,460,000		$	18,649,000		$	298,000		$	301,000

7

	SYSCO’s contributions to its defined benefit plans were $22,585,000 and $22,622,000 during the 13-week periods ended September 29, 2007 and September 30, 2006, respectively.
	Although contributions to its qualified pension plan (Retirement Plan) are not required to meet ERISA minimum funding requirements, the company anticipates it will make voluntary contributions of approximately $80,000,000 during fiscal 2008. The company’s contributions to the Supplemental Executive Retirement Plan (SERP) and other post-retirement plans are made in the amounts needed to fund current year benefit payments. The estimated fiscal 2008 contributions to fund benefit payments for the SERP and other post-retirement plans are $11,777,000 and $268,000, respectively.
6.	Earnings Per Share
	The following table sets forth the computation of basic and diluted earnings per share:

	13-Week Period Ended
	Sept. 29, 2007		Sept. 30, 2006
Numerator:
Net earnings	$	266,989,000	$	230,148,000
Denominator:
Weighted-average basic shares outstanding		610,810,914		620,127,064
Dilutive effect of employee and director stock options		6,297,399		5,359,886
Weighted-average diluted shares outstanding		617,108,313		625,486,950
Basic earnings per share	$	0.44	$	0.37
Diluted earnings per share:	$	0.43	$	0.37

	The number of options that were not included in the diluted earnings per share calculation because the effect would have been anti-dilutive was approximately 21,000,000 and 35,000,000 for the first quarter of fiscal 2008 and 2007, respectively.
7.	Share-Based Compensation
	SYSCO provides compensation benefits to employees and non-employee directors under several share-based payment arrangements including the 2004 Stock Option Plan, the 2005 Non-Employee Directors Stock Plan, the Employees’ Stock Purchase Plan and the 2005 Management Incentive Plan.
	SYSCO accounts for share-based compensation using the fair value recognition provisions of FASB Statement No. 123(R), “Share-Based Payment” (SFAS 123(R)).
	Stock Option Plans
	Options to purchase 6,504,200 shares were granted to employees in the first quarter fiscal 2007 from the 2004 Stock Option Plan. There were no option grants to employees during the first quarter of fiscal 2008. In the first quarter of fiscal 2007, 27,000 shares of restricted stock and options to purchase 31,500 shares were granted to non-employee directors from the 2005 Non-

8

	Employee Directors Stock Plan. There were no option grants or restricted stock grants to non-employee directors during the first quarter of fiscal 2008.
	The fair value of each option award is estimated as of the date of grant using a Black-Scholes option pricing model. The weighted average grant-date fair value per share of options granted during the first quarter of fiscal 2007 was $6.85.
	Employees’ Stock Purchase Plan
	Shares of SYSCO common stock purchased by plan participants under the SYSCO Employees’ Stock Purchase Plan during the first quarter of fiscal 2008 and 2007 were 433,910 and 475,488, respectively.
	The weighted average fair value per share of employee stock purchase rights issued pursuant to the Employees’ Stock Purchase Plan was $4.95 and $4.58 during the first quarter of fiscal 2008 and 2007, respectively. The fair value of the stock purchase rights was calculated as the difference between the stock price and the employee purchase price.
	Management Incentive Compensation
	A total of 588,143 shares and 323,822 shares at a fair value per share of $32.99 and $30.56, respectively, were issued pursuant to the Management Incentive Plan in the first quarter of fiscal 2008 and fiscal 2007, respectively, for bonuses earned in the preceding fiscal years.
	All Share-Based Payment Arrangements
	The total share-based compensation cost that has been recognized in results of operations was $15,193,000 and $31,481,000 for the first quarter of fiscal 2008 and fiscal 2007, respectively.
	As of September 29, 2007, there was $71,391,000 of total unrecognized compensation cost related to share-based compensation arrangements. That cost is expected to be recognized over a weighted-average period of 2.52 years.
8.	Income Taxes
	SYSCO is subject to income tax primarily in the United States and Canada. As discussed in Note 2, Changes in Accounting, the company adopted FIN 48 effective July 1, 2007. As a result of this adoption, the company recognized, as a cumulative effect of change in accounting principle, a $91,635,000 decrease in its beginning retained earnings related to FIN 48.
	As of July 1, 2007, the gross amount of unrecognized tax benefits was $82,639,000, which represents all tax jurisdictions. The company generally does not anticipate that settlement of the liabilities will require payment of cash within the next twelve months. As of July 1, 2007, the gross amount of accrued interest liabilities was $126,795,000 related to unrecognized tax benefits. The company does not have any accrued liabilities for penalties related to unrecognized tax benefits. To the extent interest and penalties may be assessed by taxing authorities on any underpayment of income tax, such amounts have been accrued and are classified as a component of income taxes in the consolidated results of operations. This was the company’s accounting policy prior to the adoption of FIN 48 and SYSCO elected to continue this accounting policy post-adoption.
	If SYSCO were to recognize all unrecognized tax benefits recorded as of July 1, 2007, approximately $56,034,000 of the $82,639,000 reserve would benefit the effective tax rate. As

9

	of the date of adoption of FIN 48 and as of September 29, 2007, the company does not anticipate that any of its unrecognized tax benefits will significantly increase or decrease within the next twelve months. The company does not anticipate accrued interest on unrecognized tax benefits to be material for fiscal 2008.
	SYSCO is currently in appeals as it relates to certain adjustments from the Internal Revenue Service (IRS) in relation to their audit of the company’s 2003 and 2004 federal income tax returns. The IRS is also auditing SYSCO’s 2005 and 2006 federal income tax returns; however, the company does not believe these audits will conclude in fiscal 2008. SYSCO’s tax returns in the majority of the state and local jurisdictions are no longer subject to audit for years before 2003; however, some jurisdictions have audits open prior to 2003 with the latest dating back to 1996. Several of the company’s subsidiaries are open to examination in Canada dating back to 2003. Although the outcome of tax audits is always uncertain, the company believes that adequate amounts of tax, including interest and penalties, have been provided for any adjustments that are expected to result from those years.
	Reflected in the changes in the net deferred tax liability and prepaid/accrued income tax balances from June 30, 2007 to September 29, 2007 is the reclassification of deferred tax liabilities to accrued income taxes related to supply chain distributions. This reclassification reflects the tax payments to be made during the next twelve months related to previously deferred supply chain distributions.
	The effective tax rate for the first quarter of fiscal 2008 was 38.1%, a decrease from the effective tax rate of 38.7% for the first quarter of fiscal 2007. The decrease in the effective tax rate was primarily due to the recognition of a tax benefit of approximately $7,700,000 resulting from a net operating loss deferred tax asset which arose due to a recently enacted state tax law. This decrease was partially offset by an increase in a tax provision for a foreign tax liability of approximately $3,000,000.
	The determination of the company’s overall effective tax rate requires the use of estimates. The effective tax rate reflects a combination of income earned and taxed in the various U.S. federal and state, as well as Canadian federal and provincial, jurisdictions. Jurisdictional tax law changes, increases/decreases in permanent differences between book and tax items, tax credits and the company’s change in earnings from these taxing jurisdictions all affect the overall effective tax rate.
9.	Acquisitions
	During the first quarter of fiscal 2008, the company paid cash of $25,750,000 for acquisitions during fiscal 2008 and for contingent consideration related to operations acquired in previous fiscal years.
	Certain acquisitions involve contingent consideration typically payable only in the event that specified operating results are attained or certain outstanding contingencies are resolved. Aggregate contingent consideration amounts outstanding as of September 29, 2007 included $77,306,000 in cash, which, if distributed, could result in the recording of additional goodwill. Such amounts are to be paid out over periods of up to four years from the date of acquisition if the contingent criteria are met.

10

10.	Commitments and Contingencies
	SYSCO is engaged in various legal proceedings which have arisen but have not been fully adjudicated. These proceedings, in the opinion of management, will not have a material adverse effect upon the consolidated financial position or results of operations of the company when ultimately concluded.
	Product Liability Claim
	In October 2007, SYSCO received an arbitration judgment against the company which formalized the proceedings from July 2007, related to a product liability claim from one of its former customers. As of September 29, 2007, the company has recorded $50,296,000 on its consolidated balance sheet within accrued expenses related to the accrual of this loss. Also as of September 29, 2007, a corresponding receivable of $48,296,000 is included in the consolidated balance sheet within prepaid expenses and other current assets, which represents the estimate of the loss less the $2,000,000 deductible on SYSCO’s insurance policy. The company has hold harmless agreements with the product suppliers and is named as an additional insured party under the suppliers’ policies with their insurers. Further, SYSCO maintains its own product liability insurance with coverage related to this claim. The company believes it is probable that it will be able to recover the recorded loss from one or more of these sources.
	Multi-Employer Pension Plans
	SYSCO contributes to several multi-employer defined benefit pension plans based on obligations arising under collective bargaining agreements covering union-represented employees. SYSCO does not directly manage these multi-employer plans, which are generally managed by boards of trustees, half of whom are appointed by the unions and the other half by other contributing employers to the plan. Based upon the information available from plan administrators, management believes that several of these multi-employer plans are under funded. In addition, the Pension Protection Act, enacted in August 2006, will require under funded pension plans to improve their funding ratios within prescribed intervals based on the level of their under funding, perhaps beginning as soon as calendar 2008. As a result, SYSCO’s expects its contributions to these plans to increase in the future.
	Under current law regarding multi-employer defined benefit plans, a plan’s termination, SYSCO’s voluntary withdrawal, or the mass withdrawal of all contributing employers from any under funded multi-employer defined benefit plan would require SYSCO to make payments to the plan for SYSCO’s proportionate share of the multi-employer plan’s unfunded vested liabilities. Based on the information available from plan administrators, SYSCO estimates that its share of withdrawal liability on all the multi-employer plans it participates in could be as much as $135,000,000 based on a voluntary withdrawal. In addition, if a multi-employer defined benefit plan fails to satisfy certain minimum funding requirements, the IRS may impose a nondeductible excise tax of 5% on the amount of the accumulated funding deficiency for those employers contributing to the fund. Of the plans in which SYSCO participates, one plan is more critically under funded than the others. During the first quarter of fiscal 2008, SYSCO obtained information that this plan failed to satisfy minimum funding requirements for certain periods and believes it is probable that additional funding will be required as well as the payment of excise tax. Therefore, SYSCO recorded a liability of $9,410,000 related to its share of the minimum funding requirements and related excise tax for these periods.

11

	BSCC Cooperative Structure
	SYSCO’s affiliate, BSCC, is a cooperative taxed under subchapter T of the Unites States Internal Revenue Code. SYSCO believes that the deferred tax liabilities resulting from the business operations and legal ownership of BSCC are appropriate under the tax laws. However, if the application of the tax laws to the cooperative structure of BSCC were to be successfully challenged by any federal, state or local tax authority, SYSCO could be required to accelerate the payment of all or a portion of its income tax liabilities associated with BSCC that it otherwise has deferred until future periods, and in that event, would be liable for interest on such amounts. As of September 29, 2007, SYSCO has recorded accrued income taxes of $575,248,000 and deferred income tax liabilities of $575,464,000, net of federal benefit, related to the BSCC supply chain distributions. If the IRS or any other taxing authority determines that all amounts since the inception of BSCC were inappropriately deferred, and the determination is upheld, SYSCO estimates that in addition to making a current payment for amounts previously deferred, as discussed above, the company may be required to pay interest on the cumulative deferred balances. These interest amounts range from $210,000,000 to $235,000,000, prior to federal and state income tax benefit, as of September 29, 2007. SYSCO calculated this amount based upon the amounts deferred since the inception of BSCC applying the applicable jurisdictions’ interest rates in effect in each period. The IRS, in connection with its audit of the company’s 2003 and 2004 federal income tax returns, proposed adjustments related to the taxability of the cooperative structure. The company is vigorously protesting these adjustments. The company has reviewed the merits of the issues raised by the IRS, and while management believes it is probable the company will prevail, the company concluded the measurement model of FIN 48 required an accrual for a portion of the interest exposure.
	Fuel Commitments
	From time to time, SYSCO may enter into forward purchase commitments for a portion of its projected diesel fuel requirements. As of September 29, 2007, outstanding forward diesel fuel purchase commitments total approximately $22,250,000 at a fixed price through the end of calendar year 2007.
11.	Business Segment Information
	The company has aggregated its operating companies into a number of segments, of which only Broadline and SYGMA are reportable segments as defined in SFAS No. 131, “Disclosures about Segments of an Enterprise and Related Information.” Broadline operating companies distribute a full line of food products and a wide variety of non-food products to both traditional and chain restaurant customers. SYGMA operating companies distribute a full line of food products and a wide variety of non-food products to certain chain restaurant customer locations. “Other” financial information is attributable to the company’s other segments, including the company’s specialty produce, custom-cut meat and lodging industry segments and a company that distributes to internationally located chain restaurants.
	The accounting policies for the segments are the same as those disclosed by SYSCO. Intersegment sales represent specialty produce and meat company products distributed by the Broadline and SYGMA operating companies. The segment results include allocation of centrally incurred costs for shared services that are eliminated upon consolidation. Centrally incurred costs are allocated based upon the relative level of service used by each operating company.

12

The company does not allocate to its segments share-based compensation expense related to stock option grants, issuances of stock pursuant to the Employees’ Stock Purchase Plan and stock grants to non-employee directors. The decrease in unallocated corporate expenses for the first quarter of fiscal 2008 over fiscal 2007 is primarily attributable to reduced share-based compensation expense and increased gains recorded related to the cash surrender value of corporate-owned life insurance policies.

	13-Week Period Ended
	Sept. 29, 2007			Sept. 30, 2006
Sales (in thousands):
Broadline	$	7,497,399		$	6,844,822
SYGMA		1,134,707			1,072,077
Other		887,562			868,815
Intersegment sales		(113,824	)		(113,642	)
Total	$	9,405,844		$	8,672,072

	13-Week Period Ended
	Sept. 29, 2007			Sept. 30, 2006
Earnings before income taxes (in thousands):
Broadline	$	440,040		$	411,106
SYGMA		2,786			1,447
Other		30,275			28,465
Total segments		473,101			441,018
Unallocated corporate expenses		(41,807	)		(65,412	)
Total	$	431,294		$	375,606

	Sept. 29, 2007		June 30, 2007		Sept. 30, 2006
Assets (in thousands):
Broadline	$	5,911,314	$	5,573,079	$	5,549,038
SYGMA		390,432		385,470		342,153
Other		977,081		929,573		864,936
Total segments		7,278,827		6,888,122		6,756,127
Corporate		2,739,117		2,630,809		2,605,963
Total	$	10,017,944	$	9,518,931	$	9,362,090

13

12.	Supplemental Guarantor Information
	SYSCO International, Co. is an unlimited liability company organized under the laws of the Province of Nova Scotia, Canada and is a wholly-owned subsidiary of SYSCO. In May 2002, SYSCO International, Co. issued, in a private offering, $200,000,000 of 6.10% notes due in 2012. These notes are fully and unconditionally guaranteed by SYSCO.
	The following condensed consolidating financial statements present separately the financial position, results of operations and cash flows of the parent guarantor (SYSCO), the subsidiary issuer (SYSCO International) and all other non-guarantor subsidiaries of SYSCO (Other Non-Guarantor Subsidiaries) on a combined basis and eliminating entries.

	Condensed Consolidating Balance Sheet
	September 29, 2007
			SYSCO		Other Non-Guarantor						Consolidated
	SYSCO		International		Subsidiaries			Eliminations			Totals
	(In thousands)
Current assets	$	226,998	$	—	$	4,802,829		$	—		$	5,029,827
Investment in subsidiaries		13,032,564		377,176		104,597			(13,514,337	)		—
Plant and equipment, net		181,998		—		2,598,782			—			2,780,780
Other assets		692,610		—		1,514,727			—			2,207,337
Total assets	$	14,134,170	$	377,176	$	9,020,935		$	(13,514,337	)	$	10,017,944
Current liabilities	$	347,859	$	4,082	$	3,022,804		$	—		$	3,374,745
Intercompany payables (receivables)		8,424,631		72,779		(8,497,410	)		—			—
Long-term debt		1,689,188		235,905		44,711			—			1,969,804
Other liabilities		549,462		—		826,478			—			1,375,940
Shareholders’ equity		3,123,030		64,410		13,624,352			(13,514,337	)		3,297,455
Total liabilities and shareholders’ equity	$	14,134,170	$	377,176	$	9,020,935		$	(13,514,337	)	$	10,017,944

	Condensed Consolidating Balance Sheet
	June 30, 2007
			SYSCO		Other Non-Guarantor						Consolidated
	SYSCO		International		Subsidiaries			Eliminations			Totals
	(In thousands)
Current assets	$	244,441	$	—	$	4,431,105		$	—		$	4,675,546
Investment in subsidiaries		12,675,360		349,367		126,364			(13,151,091	)		—
Plant and equipment, net		170,288		—		2,550,945			—			2,721,233
Other assets		654,287		—		1,467,865			—			2,122,152
Total assets	$	13,744,376	$	349,367	$	8,576,279		$	(13,151,091	)	$	9,518,931
Current liabilities	$	371,149	$	1,034	$	3,042,906		$	—		$	3,415,089
Intercompany payables (receivables)		8,251,239		44,757		(8,295,996	)		—			—
Long-term debt		1,471,428		243,786		43,013			—			1,758,227
Other liabilities		505,660		—		561,555			—			1,067,215
Shareholders’ equity		3,144,900		59,790		13,224,801			(13,151,091	)		3,278,400
Total liabilities and shareholders’ equity	$	13,744,376	$	349,367	$	8,576,279		$	(13,151,091	)	$	9,518,931

14

	Condensed Consolidating Balance Sheet
	September 30, 2006
			SYSCO		Other Non-Guarantor						Consolidated
	SYSCO		International		Subsidiaries			Eliminations			Totals
	(In thousands)
Current assets	$	203,705	$	24	$	4,491,461		$	—		$	4,695,190
Investment in subsidiaries		11,605,547		323,063		133,368			(12,061,978	)		—
Plant and equipment, net		181,123		—		2,305,178			—			2,486,301
Other assets		732,285		—		1,448,314			—			2,180,599
Total assets	$	12,722,660	$	323,087	$	8,378,321		$	(12,061,978	)	$	9,362,090
Current liabilities	$	418,486	$	3,976	$	2,779,003		$	—		$	3,201,465
Intercompany payables (receivables)		7,217,895		49,657		(7,267,552	)		—			—
Long-term debt		1,485,016		211,259		42,583			—			1,738,858
Other liabilities		521,315		—		712,610			—			1,233,925
Shareholders’ equity		3,079,948		58,195		12,111,677			(12,061,978	)		3,187,842
Total liabilities and shareholders’ equity	$	12,722,660	$	323,087	$	8,378,321		$	(12,061,978	)	$	9,362,090

	Condensed Consolidating Results of Operations
	For the 13-Week Period Ended September 29, 2007
				SYSCO			Other Non-Guarantor						Consolidated
	SYSCO			International			Subsidiaries			Eliminations			Totals
	(In thousands)
Sales	$	—		$	—		$	9,405,844		$	—		$	9,405,844
Cost of sales		—			—			7,614,702			—			7,614,702
Gross margin		—			—			1,791,142			—			1,791,142
Operating expenses		35,492			33			1,300,984			—			1,336,509
Operating income		(35,492	)		(33	)		490,158			—			454,633
Interest expense (income)		110,609			2,751			(86,989	)		—			26,371
Other income, net		(823	)		—			(2,209	)		—			(3,032	)
Earnings (losses) before income taxes		(145,278	)		(2,784	)		579,356			—			431,294
Income tax (benefit) provision		(55,369	)		(1,061	)		220,735			—			164,305
Equity in earnings of subsidiaries		356,898			6,343			—			(363,241	)		—
Net earnings	$	266,989		$	4,620		$	358,621		$	(363,241	)	$	266,989

	Condensed Consolidating Results of Operations
	For the 13-Week Period Ended September 30, 2006
				SYSCO			Other Non-Guarantor						Consolidated
	SYSCO			International			Subsidiaries			Eliminations			Totals
	(In thousands)
Sales	$	—		$	—		$	8,672,072		$	—		$	8,672,072
Cost of sales		—			—			7,002,856			—			7,002,856
Gross margin		—			—			1,669,216			—			1,669,216
Operating expenses		61,469			32			1,215,381			—			1,276,882
Operating income		(61,469	)		(32	)		453,835			—			392,334
Interest expense (income)		98,278			2,724			(75,236	)		—			25,766
Other income, net		(6,429	)		—			(2,609	)		—			(9,038	)
Earnings (losses) before income taxes		(153,318	)		(2,756	)		531,680			—			375,606
Income tax (benefit) provision		(60,135	)		(1,071	)		206,664			—			145,458
Equity in earnings of subsidiaries		323,331			5,676			—			(329,007	)		—
Net earnings	$	230,148		$	3,991		$	325,016		$	(329,007	)	$	230,148

15

	Condensed Consolidating Cash Flows
	For the 13-Week Period Ended September 29, 2007
				SYSCO			Other Non-Guarantor			Consolidated
	SYSCO			International			Subsidiaries			Totals
	(In thousands)
Net cash provided by:
Operating activities	$	(29,318	)	$	7,671		$	213,413		$	191,766
Investing activities		(22,188	)		—			(131,860	)		(154,048	)
Financing activities		(49,857	)		(7,885	)		1,555			(56,187	)
Effect of exchange rate on cash		—			—			751			751
Intercompany activity		94,136			214			(94,350	)		—
Net decrease in cash		(7,227	)		—			(10,491	)		(17,718	)
Cash at the beginning of the period		135,877			—			71,995			207,872
Cash at the end of the period	$	128,650		$	—		$	61,504		$	190,154

	Condensed Consolidating Cash Flows
	For the 13-Week Period Ended September 30, 2006
				SYSCO			Other Non-Guarantor			Consolidated
	SYSCO			International			Subsidiaries			Totals
	(In thousands)
Net cash provided by:
Operating activities	$	28,654		$	1,280		$	143,249		$	173,183
Investing activities		(27,304	)		—			(133,665	)		(160,969	)
Financing activities		(19,936	)		(12,988	)		(405	)		(33,329	)
Effect of exchange rate on cash		—			—			(61	)		(61	)
Intercompany activity		12,293			11,708			(24,001	)		—
Net decrease in cash		(6,293	)		—			(14,883	)		(21,176	)
Cash at the beginning of the period		131,275			—			70,622			201,897
Cash at the end of the period	$	124,982		$	—		$	55,739		$	180,721

16

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations
	Unless this Form 10-Q indicates otherwise or the context otherwise requires, the terms “we,” “our,” “us,” “SYSCO,” or “the company” as used in this Form 10-Q refer to Sysco Corporation together with its consolidated subsidiaries and divisions. This discussion should be read in conjunction with our consolidated financial statements as of June 30, 2007, and the fiscal year then ended, and Management’s Discussion and Analysis of Financial Condition and Results of Operations, both contained in our Annual Report on Form 10-K for the fiscal year ended June 30, 2007.
	Highlights
	Sales increased 8.5% in the first quarter of fiscal 2008 over the comparable prior year period. Operating income increased 15.9% over the comparable prior year period, increasing to 4.8% of sales. The prevailing market environment was characterized by high food cost inflation for the second consecutive quarter. Product cost increases, estimated at 5.9%, and the corresponding increase in sales contributed to a 0.2 percentage point decrease in gross margins as a percentage of sales and a 0.5 percentage point decrease in operating expenses as a percentage of sales from the same period last year. Operating expenses were favorably impacted by a reduction in share-based compensation expense of $16,288,000. Conversely, operating expenses were negatively impacted by a provision of $9,410,000 related to an under funded multi-employer pension fund. Net earnings and diluted earnings per share increased 16.0% and 16.2%, respectively, in the first quarter of fiscal 2008 over the comparable prior year period.
	Overview
	SYSCO distributes food and related products to restaurants, healthcare and educational facilities, lodging establishments and other foodservice customers. Our operations are located throughout the United States and Canada and include broadline companies, specialty produce companies, custom-cut meat operations, hotel supply operations, SYGMA (our chain restaurant distribution subsidiary) and a company that distributes to internationally located chain restaurants.
	We estimate that we serve about 15% of an approximately $225 billion annual market that includes the foodservice market and the hotel amenity, furniture and textile market both in the United States and Canada. According to industry sources, the foodservice, or food-prepared-away-from-home, market represents approximately one-half of the total dollars spent on food purchases made at the consumer level. This share grew from about 37% in 1972 to about 50% in 1998 and has not changed materially since that time.
	General economic conditions and consumer confidence can affect the frequency of purchases and amounts spent by consumers for food-prepared-away-from-home and, in turn, can impact our sales. Historically, we have grown at a faster rate than the overall industry and have grown our market share in this fragmented industry. We intend to continue to expand our market share and grow earnings by focusing on sales growth, brand management, productivity gains, sales force effectiveness and supply chain management.

17

Strategic Business Initiatives

Our strategic business initiatives are designed to help us grow by leveraging our market leadership position to continuously improve how our associates buy, handle and market products for our customers. The following areas, which are described in Management’s Discussion and Analysis of Financial Condition and Results of Operations, in our Annual Report on Form 10-K for the fiscal year ended June 30, 2007, generally comprise the initiatives that will serve as the foundation of our efforts to ensure a sustainable future:

• Sourcing and National Supply Chain

• Integrated Delivery

• Demand

• Organizational Capabilities

A major component of our National Supply Chain project entails the use of redistribution centers (RDCs). Construction of our second RDC site in Alachua, Florida, which will service our five broadline operating companies in Florida, is in progress and this facility is expected to be operational in the latter half of fiscal 2008.

Accounting Changes

As of June 30, 2007, we early-adopted the measurement date provision of FASB Statement No. 158, “Employers’ Accounting for Defined Benefit and Other Postretirement Plans – an amendment of FASB Statements No. 87, 88, 106, and 132(R)” (SFAS 158). The measurement date provision requires employers to measure plan assets and benefit obligations as of the date of the employer’s fiscal year-end statement of financial position. As a result, beginning in fiscal 2008, the measurement date for our defined benefit and other postretirement plans will correspond with our fiscal year-end rather than the May 31^st measurement date previously used. We have performed measurements as of May 31, 2007 and June 30, 2007 of our plan assets and benefit obligations. We recorded a charge to beginning retained earnings on July 1, 2007 of $3,572,000, net of tax, for the impact of the cumulative difference in our pension expense between the two measurement dates. We also recorded a benefit to beginning accumulated other comprehensive income (loss) on July 1, 2007 of $22,780,000, net of tax, for the impact of the difference in our balance sheet recognition provision between the two measurement dates.

As of July 1, 2007, we adopted FASB Interpretation No. 48, “Accounting for Uncertainty in Income Taxes — an Interpretation of FASB Statement No. 109” (FIN 48), which clarifies the accounting for uncertainty in income taxes recognized in accordance with FASB Statement No. 109 (SFAS 109). FIN 48 clarifies the application of SFAS 109 by defining criteria that an individual tax position must meet for any part of the benefit of that position to be recognized in the financial statements. Additionally, FIN 48 provides guidance on the measurement, derecognition, classification and disclosure of tax positions, along with accounting for the related interest and penalties. As a result of this adoption, we recognized, as a cumulative effect of change in accounting principle, a $91,635,000 decrease in our beginning retained earnings related to FIN 48.

18

Results of Operations

The following table sets forth the components of the Results of Operations expressed as a percentage of sales for the periods indicated:

	13-Week Period Ended
	Sept. 29, 2007			Sept. 30, 2006
Sales		100.0	%		100.0	%
Cost of sales		81.0			80.8
Gross margin		19.0			19.2
Operating expenses		14.2			14.7
Operating income		4.8			4.5
Interest expense		0.3			0.3
Other income, net		(0.0	)		(0.1	)
Earnings before income taxes		4.5			4.3
Income taxes		1.7			1.7
Net earnings		2.8	%		2.6	%

The following table sets forth the change in the components of the Results of Operations expressed as a percentage increase or decrease over the comparable period in the prior year:

	13-Week Period
Sales		8.5	%
Cost of sales		8.7
Gross margin		7.3
Operating expenses		4.7
Operating income		15.9
Interest expense		2.3
Other income, net		(66.5	)
Earnings before income taxes		14.8
Income taxes		13.0
Net earnings		16.0	%
Basic earnings per share		18.9
Diluted earnings per share		16.2
Average shares outstanding		(1.5	)
Diluted shares outstanding		(1.3	)

Sales

The first quarter of fiscal 2008 was a challenging operating environment as high food cost inflation prevailed for the second consecutive quarter. Sales for the first quarter of fiscal 2008 were 8.5% greater than the comparable period of the prior year. Inflation was a significant contributor to sales growth. Estimated product cost increases, an internal measure of inflation, were 5.9% during the first quarter of fiscal 2008, as compared to 2.4% in the first quarter of fiscal 2007. Estimated product cost increases during the fourth quarter of fiscal 2007 were 6.1%. Non-comparable acquisitions contributed 0.2% to the overall sales growth rate for the first quarter of fiscal 2008.

19

Our continued focus on sales growth through the use of business reviews and business development activities, continued investment in customer contact personnel and the efforts of our marketing associates and sales support personnel also contributed to our sales growth.

Operating Income

Operating income increased 15.9% for the first quarter of fiscal 2008 as compared to the first quarter of fiscal 2007. We were able to continue to manage the current inflationary environment well, resulting in gross margin dollars increasing 7.3% for the quarter and operating expenses increasing only 4.7%.

The high rate of product cost increases and the accompanying increases in sales in the first quarter of fiscal 2008 as compared to the first quarter of fiscal 2007 impacts the comparison of gross margins and operating expenses as a percentage of sales between the two periods. As sales prices increased, gross margin dollars were earned and operating expense dollars were incurred on a higher sales dollars base. In addition, operating expense dollars increased at a lower rate than sales growth aided by inflation and improvements in operating efficiencies.

While we cannot predict if product cost inflation will continue in future periods, in general, we believe prolonged periods of high inflation may have a negative impact on our customers and as a result, on our sales, gross margins and earnings.

Share-based compensation cost in the first quarter of fiscal 2008 was $16,288,000 less than the first quarter of fiscal 2007 primarily as a result of moving the annual grant date for stock options from the first quarter to the second quarter of the fiscal year. In February 2007, the Board of Director’s Compensation Committee adopted stock option grant administrative guidelines which set the second Tuesday in November as the date the committee will grant stock options each year. This date is typically when we are in a trading “window” under our company’s securities trading policy. 

We record a greater amount of share-based compensation expense in the quarter that options are granted. Certain individuals receiving grants have reached the age and years of service thresholds which will result in their options continuing to vest upon retirement. The compensation expense related to these option grants are fully expensed at the grant date rather than over the vesting period. In fiscal 2007, stock option grants were made in the first quarter whereas stock option grants are planned for the second quarter in fiscal 2008. This resulted in lower share-based compensation expense in the first quarter of fiscal 2008 as compared to the first quarter of fiscal 2007. It is expected that share-based compensation expense for the second quarter of fiscal 2008 will be higher than the second quarter of fiscal 2007 due this change in the timing of option grants. The actual amount of share-based compensation expense for the second quarter of fiscal 2008 will not be known until the number of options to be granted is finalized, the fair value of such options is calculated and all the calculations related to share-based compensation expense are performed. However, we do not expect the difference between share-based compensation expense for the entire fiscal year 2008 as compared to the prior year to be a material amount.

In addition, we recorded a provision of $9,410,000 related to additional amounts that we expect to be required to contribute to an under funded multi-employer pension fund. See additional discussion of multi-employer pension plans at “Liquidity and Capital Resources, Other Considerations.”

Operating expenses were reduced by the recognition of a gain of $7,093,000 in the first quarter of fiscal 2008 to adjust the carrying value of corporate-owned life insurance policies to their

20

cash surrender value. This compared to the recognition of a gain of $1,395,000 in the first quarter of fiscal 2007.

We had fixed price forward diesel purchase contracts for a substantial portion of our fuel purchase requirements in place for the first quarter of fiscal 2008. These contracts are at prices lower than current market rates, which allowed us to effectively manage our fuel cost. These agreements expire at the end of calendar 2007. If market prices increase or remain at current prices, our fuel cost will be greater in the second half of fiscal 2008.

Net Earnings

Net earnings increased 16.0% in the first quarter of fiscal 2008 over the comparable period of the prior year. The increase was due primarily to the factors discussed above.

In addition, other income decreased $6,006,000 in the first quarter of fiscal 2008 as compared to the comparable prior year period. In the first quarter of fiscal 2007, the company recorded a gain of approximately $5,800,000 on the sale of land.

The effective tax rate for the first quarter of fiscal 2008 was 38.1%, a decrease from the effective tax rate of 38.7% for the first quarter of fiscal 2007. The decrease in the effective tax rate was primarily due to the recognition of a tax benefit of approximately $7,700,000 resulting from a net operating loss deferred tax asset which arose due to a recently enacted state tax law. This decrease was partially offset by an increase in a tax provision for a foreign tax liability of approximately $3,000,000.

Earnings Per Share

Basic earnings per share and diluted earnings per share increased 18.9% and 16.2%, respectively, in the first quarter of fiscal 2008 over the comparable period of the prior year. These increases were due primarily to the factors discussed above, as well as a net reduction in shares outstanding. The net reduction in average shares outstanding and diluted shares outstanding is primarily due to share repurchases.

Segment Results

The following table sets forth the change in the selected financial data of each of our reportable segments expressed as a percentage increase over the comparable period in the prior year and should be read in conjunction with Note 11, Business Segment Information:

	13-Week Period
				Earnings
	Sales			before taxes
Broadline		9.5	%		7.0	%
SYGMA		5.8			*
Other		2.2			6.4

* SYGMA had earnings before taxes of $2,786,000 in the first quarter of fiscal 2008 and $1,447,000 in the first quarter of fiscal 2007.

21

The following table sets forth sales and earnings before income taxes of each of our reportable segments expressed as a percentage of the respective consolidated total and should be read in conjunction with Note 11, Business Segment Information:

	13-Week Period Ended
	September 29, 2007						September 30, 2006
				Earnings						Earnings
	Sales			before taxes			Sales			before taxes
Broadline		79.7	%		102.0	%		78.9	%		109.4	%
SYGMA		12.1			0.7			12.4			0.4
Other		9.4			7.0			10.0			7.6
Intersegment sales		(1.2	)		—			(1.3	)		—
Unallocated corporate expenses		—			(9.7	)		—			(17.4	)
Total		100.0	%		100.0	%		100.0	%		100.0	%

We do not allocate share-based compensation expense related to stock option grants, issuances of stock pursuant to the Employees’ Stock Purchase Plan and restricted stock grants to non-employee directors. The decrease in unallocated corporate expenses as a percentage of consolidated earnings before taxes for the first quarter of fiscal 2008 over fiscal 2007 is primarily attributable to reduced share-based compensation expense and increased gains recorded related to the cash surrender value of corporate-owned life insurance policies.

Broadline Segment

Sales for the first quarter of fiscal 2008 were 9.5% greater than the sales for the comparable period of the prior year. Sales growth was realized in both marketing associate-served customers and multi-unit customers. Inflation was a significant contributor to sales growth. Our continued focus on sales growth through the use of business reviews and business development activities, continued investment in customer contact personnel and the efforts of our marketing associates and sales support personnel also contributed to our sales growth. Non-comparable acquisitions did not have an impact on the overall sales growth rate for the first quarter of fiscal 2008.

Marketing associate-served sales as a percentage of Broadline sales were 50.8% for the first quarter of fiscal 2008, as compared to 51.2% for the comparable prior year period. SYSCO Brand sales as a percentage of Broadline sales were 43.0% for the first quarter of fiscal 2008 as compared to 44.7% for the comparable prior year period.

The increase in earnings before income taxes for the first quarter of fiscal 2008 was primarily due to increases in sales, gross margin dollar increases and effective expense management. Partially offsetting the increase in earnings before income taxes for the first quarter of fiscal 2008, was a provision of $9,410,000 related to amounts that we expect to be required to contribute to an under funded multi-employer pension fund.

SYGMA Segment

Sales for the first quarter of fiscal 2008 were 5.8% greater than sales for the comparable prior year period. Non-comparable acquisitions contributed 1.4% to the overall sales growth rate for the first quarter of fiscal 2008. Sales growth was primarily due to sales to new customers and sales growth in SYGMA’s existing customer base related to new locations added by those

22

customers. Sales growth was partially offset by transferring certain customers to Broadline operations during the first quarter of fiscal 2008.

The increase in earnings before income taxes for the first quarter of fiscal 2008 was due to several factors, including sales growth and gross margin dollar increases, partially offset by costs of labor.

Liquidity and Capital Resources

We may apply cash provided by operating activities, as supplemented by commercial paper issuances and other bank borrowings, towards investments in facilities, fleet and other equipment; cash dividends; acquisitions consistent with our overall growth strategy; and the share repurchase program.

We believe that our cash flows from operations, as well as the availability of additional capital under our existing commercial paper programs, bank lines of credit, debt shelf registration and our ability to access capital from financial markets in the future, will be sufficient to meet our anticipated cash requirements over at least the next twelve months, while maintaining proper liquidity for normal operating purposes.

Operating Activities

We generated $191,766,000 in cash flow from operations in the first quarter of fiscal 2008, as compared to $173,183,000 in the first quarter of fiscal 2007.

Cash flow from operations in the first quarters of fiscal 2008 and fiscal 2007 was negatively impacted by an increase in inventory balances and an increase in accounts receivable balances, partially offset by an increase in accounts payable balances.

The increases in accounts receivable balances were primarily due to change in customer mix and sales growth. Due to normal seasonal patterns, sales to multi-unit customers and school districts represented a larger percentage of our sales at the end of each first quarter as compared to the end of each prior fiscal year. Payments terms for these types of customers are traditionally longer than our overall average.

Inventory balances increased primarily due to product cost increases as well as an increase in volume due to current and anticipated sales volume. Product costs increases were more significant in the first quarter of fiscal 2008 as compared to the first quarter of fiscal 2007.

The accounts payable balances also increased due to inventory growth for each period. In addition, accounts payable balances are impacted by many factors, including changes in product mix, cash discount terms and changes in payment terms with vendors due to the use of more efficient electronic payment methods.

Cash flow from operations was also negatively impacted by a decrease in accrued expenses of $131,699,000 for the first quarter of fiscal 2008 and a decrease of $55,564,000 for the first quarter of fiscal 2007. These decreases were primarily due to the payment of prior year annual incentive bonuses partially offset by accruals for current year incentives and to the payment of 401(k) matching contributions in the first quarter of each fiscal year.

Other long-term liabilities and prepaid pension cost, net, increased $10,672,000 during the first quarter of fiscal 2008 and decreased $2,112,000 during the first quarter of fiscal 2007. The increase in the first quarter of fiscal 2008 is primarily attributable to an increase in deferred

23

compensation from incentive compensation deferrals of prior year annual incentive bonuses. This increase was partially offset by the recording of net pension costs and the timing of pension contributions to our company-sponsored plans. In the first quarter of fiscal 2008, we recorded net pension costs of $16,460,000 and contributed $22,585,000 to our pension plans. The decrease in the first quarter of fiscal 2007 is related to the recording of net pension costs and the timing of pension contributions to our company-sponsored plans. In the first quarter of fiscal 2007, we recorded net pension costs of $18,649,000 and contributed $22,622,000 to our pension plans.

Financing Activities

During the first quarter of fiscal 2008, a total of 5,782,700 shares were repurchased at a cost of $189,484,000 as compared to 2,044,000 shares at a cost of $65,281,000 for the comparable period in fiscal 2007. An additional 1,680,000 shares were repurchased at a cost of $57,976,000 through October 27, 2007, resulting in 15,600,000 shares remaining available for repurchase as authorized by the Board.

Dividends paid in the first quarter of fiscal 2008 were $116,339,000, or $0.19 per share, as compared to $105,233,000, or $0.17 per share, in the comparable period of fiscal 2007. In September 2007, we declared our regular quarterly dividend for the second quarter of fiscal 2008 of $0.19 per share, which was paid in October 2007.

As of September 29, 2007, we had uncommitted bank lines of credit, which provide for unsecured borrowings for working capital of up to $145,000,000, of which $2,700,000 was outstanding at September 29, 2007. Such borrowings totaled $66,100,000 as of October 27, 2007.

As of September 29, 2007, our outstanding commercial paper issuances totaled $742,146,000. Such borrowings were $994,835,000 as of October 27, 2007. During the 13-week period ended September 29, 2007, commercial paper issuances and short-term bank borrowings ranged from approximately $532,045,000 to $865,424,000.

In September 2007, an agreement was signed on the revolving credit facility supporting our U.S. and Canadian commercial paper programs, which increased the facility amount to $1,000,000,000. In addition, the termination date on the facility was extended from November 4, 2011 to November 4, 2012 in accordance with the terms of the agreement.

The long-term debt to capitalization ratio was 37.4% at September 29, 2007. For purposes of calculating this ratio, long-term debt includes both the current maturities and long-term portions.

Other Considerations

Product Liability Claim

In October 2007, SYSCO received an arbitration judgment against us which formalized the proceedings from July 2007, related to a product liability claim from one of our former customers. As of September 29, 2007, we have recorded $50,296,000 on our consolidated balance sheet within accrued expenses related to the accrual of this loss. Also as of September 29, 2007, a corresponding receivable of $48,296,000 is included in the consolidated balance sheet within prepaid expenses and other current assets, which represents the estimate of the loss less the $2,000,000 deductible on SYSCO’s insurance policy. We have hold

 24

harmless agreements with the product suppliers and are named as an additional insured party under the suppliers’ policies with their insurers. Further, we maintain our own product liability insurance with coverage related to this claim. We believe it is probable that we will be able to recover the recorded loss from one or more of these sources.

Multi-Employer Pension Plans

As discussed in Note 10, Commitments and Contingencies, we contribute to several multi-employer defined benefit pension plans based on obligations arising under collective bargaining agreements covering union-represented employees.

Under current law regarding multi-employer defined benefit plans, a plan’s termination, our voluntary withdrawal or the mass withdrawal of all contributing employers from any under funded multi-employer defined benefit plan would require us to make payments to the plan for our proportionate share of the multi-employer plan’s unfunded vested liabilities. Based on the information available from plan administrators, we estimate that our share of withdrawal liability on all the multi-employer plans we participate in, some of which appear to be under funded, could be as much as $135,000,000 based on a voluntary withdrawal.

Required contributions to multi-employer plans could increase in the future as these plans strive to improve their funding levels. In addition, the Pension Protection Act, enacted in August 2006, will require under funded pension plans to improve their funding ratios within prescribed intervals based on the level of their under funding, perhaps beginning as soon as calendar 2008. Unforeseen requirements to pay such increased contributions, withdrawal liability and excise taxes could cause us to raise additional capital through debt financing or the issuance of equity or we may be required to cancel planned capital expenditures or share repurchases or a combination of these items. Of the plans in which SYSCO participates, one plan is more critically under funded than the others. During the first quarter of fiscal 2008, we obtained information that this plan failed to satisfy minimum funding requirements for certain periods and believe it is probable that additional funding will be required as well as the payment of excise tax. Therefore, we recorded a liability of $9,410,000 related to our share of the minimum funding requirements and related excise tax for these periods. Currently, we can not estimate when the payment of this contribution will be required.

BSCC Cooperative Structure

Our affiliate, BSCC, is a cooperative taxed under subchapter T of the Unites States Internal Revenue Code. We believe that the deferred tax liabilities resulting from the business operations and legal ownership of BSCC are appropriate under the tax laws. However, if the application of the tax laws to the cooperative structure of BSCC were to be successfully challenged by any federal, state or local tax authority, we could be required to accelerate the payment of all or a portion of our income tax liabilities associated with BSCC that we otherwise have deferred until future periods, and in that event, would be liable for interest on such amounts. As of September 29, 2007, SYSCO has recorded accrued income taxes of $575,248,000 and deferred income tax liabilities of $575,464,000, net of federal benefit, related to the BSCC supply chain distributions. If the IRS or any other taxing authority determines that all amounts since the inception of BSCC were inappropriately deferred, and the determination is upheld, we estimate that in addition to making a current payment for amounts previously deferred, as discussed above, we may be required to pay interest on the cumulative deferred balances. These interest amounts range from $210,000,000 to $235,000,000, prior to federal and state income tax benefit, as of September 29, 2007. SYSCO calculated this amount based upon the amounts deferred since the inception of BSCC applying the applicable jurisdictions’ interest rates in effect in each period. The IRS, in connection with

25

its audit of our 2003 and 2004 federal income tax returns, proposed adjustments related to the taxability of the cooperative structure. We are vigorously protesting these adjustments. We have reviewed the merits of the issues raised by the IRS, and while management believes it is probable we will prevail, we concluded the measurement model of FIN 48 required us to provide an accrual for a portion of the interest exposure. If a taxing authority requires us to accelerate the payment of these deferred tax liabilities and to pay related interest, if any, we would be required to raise additional capital through debt financing or the issuance of equity or we may have to forego or defer planned capital expenditures or share repurchases or a combination of these items.

Contractual Obligations

Our Annual Report on Form 10-K for the fiscal year ended June 30, 2007 contains a table that summarizes our obligations and commitments to make contractual future payments as of June 30, 2007. Since June 30, 2007, there have been no material changes to our contractual obligations, except for the presentation of our liability for unrecognized tax benefits and related interest due to our adoption of FIN 48 on July 1, 2007. As of September 29, 2007, we had a liability of $61,428,000 for unrecognized tax benefits for all tax jurisdictions and $129,915,000 for related interest that could result in cash payment. We do not anticipate that any of our unrecognized tax benefits and related interest will significantly increase or decrease within the next twelve months. In addition, we do not anticipate that settlement of the liabilities will require payment of cash within the next twelve months. For further discussion of the impact of adopting FIN 48, see Note 8, Income Taxes.

Critical Accounting Policies and Estimates

Critical accounting policies and estimates are those that are most important to the portrayal of our financial position and results of operations. These policies require our most subjective or complex judgments, often employing the use of estimates about the effect of matters that are inherently uncertain. SYSCO’s most critical accounting policies and estimates include those that pertain to the allowance for doubtful accounts receivable, self-insurance programs, pension plans, income taxes, vendor consideration, accounting for business combinations and share-based compensation, which are described in Item 7 of our Annual Report on Form 10-K for the year ended June 30, 2007.

Forward-Looking Statements

Certain statements made herein are forward-looking statements under the Private Securities Litigation Reform Act of 1995. They include statements regarding expense trends; the impact of ongoing legal proceedings; the timing of the National Supply Chain project and regional distribution centers; the ability to increase sales and market share and grow earnings; continued competitive advantages and positive results from strategic business initiatives; the potential for future success; anticipated pension plan liabilities and contributions of various pension plans; the outcome of ongoing tax audits; the continuing impact of economic conditions on sales growth; growth strategies; and our ability to meet our cash requirements while maintaining proper liquidity. These statements involve risks and uncertainties and are based on management’s current expectations and estimates; actual results may differ materially. Those risks and uncertainties that could impact these statements include the risks discussed in Item 1A of our Annual Report on Form 10-K for the fiscal year ended June 30, 2007, including risks relating to the foodservice distribution industry’s relatively low profit margins and sensitivity to general economic conditions, including inflation, the current economic environment, increased fuel costs and consumer spending; SYSCO’s leverage and debt risks; the successful completion of acquisitions and integration of acquired companies as well as the risk that acquisitions could

26

require additional debt or equity financing and negatively impact our stock price or operating results; the effect of competition on us and our customers; the ultimate outcome of litigation; potential impact of product liability claims; the risk of interruption of supplies due to lack of long-term contracts, severe weather, work stoppages or otherwise; labor issues; construction schedules; management’s allocation of capital and the timing of capital purchases; risks relating to the successful completion and operation of the national supply chain project including the Northeast Redistribution Center; the risk that the IRS will disagree with our tax positions and seek to impose interest or penalties; the risk that other sponsors of our multi-employer pension plans will withdraw or become insolvent; that the IRS may impose an excise tax on the unfunded portion of our multi-employer pension plans; or that the Pension Protection Act could require that we make additional pension contributions; and internal factors such as the ability to increase efficiencies, control expenses and successfully execute growth strategies. The expected impact of option expensing is based on certain assumptions regarding the number and fair value of options granted, resulting tax benefits and shares outstanding. The actual impact of option expensing could vary significantly to the extent actual results vary significantly from assumptions.

In addition, share repurchases could be affected by market prices for the company’s securities as well as management’s decision to utilize our capital for other purposes. Interest paid is impacted by capital and borrowing needs and changes in interest rates. The effect of market risks could be impacted by future borrowing levels and economic factors such as interest rates. For a more detailed discussion of these and other factors that could cause actual results to differ from those contained in the forward-looking statements, see the risk factors discussion contained in Item 1A of our Annual Report on Form 10-K for the fiscal year ended June 30, 2007.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

We do not utilize financial instruments for trading purposes. Our use of debt directly exposes us to interest rate risk. Floating rate debt, for which the interest rate fluctuates periodically, exposes us to short-term changes in market interest rates. Fixed rate debt, for which the interest rate is fixed over the life of the instrument, exposes us to changes in market interest rates reflected in the fair value of the debt and to the risk we may need to refinance maturing debt with new debt at higher rates.

We manage our debt portfolio to achieve an overall desired position of fixed and floating rates and may employ interest rate swaps as a tool to achieve that goal. The major risks from interest rate derivatives include changes in interest rates affecting the fair value of such instruments, potential increases in interest expense due to market increases in floating interest rates and the creditworthiness of the counterparties in such transactions.

At September 29, 2007, we had outstanding $742,146,000 of commercial paper issuances at variable rates of interest with maturities through December 19, 2007. Excluding commercial paper issuances, our long-term debt obligations at September 29, 2007 were $1,231,234,000 and were primarily at fixed rates of interest.

In order to partially manage the volatility and uncertainty of fuel costs, from time to time, we may enter into forward purchase commitments for a portion of our projected diesel fuel requirements. As of September 29, 2007, outstanding forward diesel fuel purchase commitments total approximately $22,250,000, which will lock in the price on a substantial portion of our fuel purchases through the end of calendar year 2007. These contracts are at prices lower than current market rates, which allowed us to effectively manage our exposure to fuel price risk. If market prices increase or remain at current prices, our fuel cost will be

27

greater in the second half of fiscal 2008.

Item 4. Controls and Procedures

SYSCO’s management, with the participation of our chief executive officer and chief financial officer, evaluated the effectiveness of our disclosure controls and procedures as of September 29, 2007. The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company’s management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding the required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on the evaluation of our disclosure controls and procedures as of September 29, 2007, our chief executive officer and chief financial officer concluded that, as of such date, SYSCO’s disclosure controls and procedures were effective at the reasonable assurance level.

No change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) occurred during the fiscal quarter ended September 29, 2007 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

28

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

We are engaged in various legal proceedings which have arisen but have not been fully adjudicated. These proceedings, in the opinion of management, will not have a material adverse effect upon the consolidated financial statements of SYSCO when ultimately concluded.

Item 1A. Risk Factors

The information set forth in this report should be read in conjunction with the risk factors discussed in Item 1A of our Annual Report on Form 10-K for the year ended June 30, 2007, which could materially impact our business, financial condition or future results. The risks described in the Annual Report on Form 10-K are not the only risks facing the company. Additional risks and uncertainties not currently known by the company or that are currently deemed to be immaterial also may materially adversely affect our business, financial condition and/or operating results.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

We made the following share repurchases during the first quarter of fiscal 2008:

ISSUER PURCHASES OF EQUITY SECURITIES

					(c) Total Number of
					Shares Purchased as		(d) Maximum Number
			(b) Average		Part of Publicly		of Shares that May Yet
	(a) Total Number of		Price Paid per		Announced Plans or		Be Purchased Under
Period	Shares Purchased(1)		Share		Programs		the Plans or Programs
Month #1 July 1 – July 28		1,758,723	$	32.54		1,740,000		21,367,700
Month #2 July 29 – August 25		1,846,398		32.10		1,817,700		19,550,000
Month #3 August 26 – September 29		2,267,831		33.51		2,225,000		17,325,000
Total		5,872,952		32.78		5,782,800		17,325,000

(1)	The total number of shares purchased includes 18,723, 28,698 and 42,831 shares tendered by individuals in connection with stock option exercises in Month #1, Month #2 and Month #3, respectively. All other shares were purchased pursuant to the publicly announced programs described below.
	On November 10, 2005, we announced that the Board of Directors approved the repurchase of 20,000,000 shares. On July 18, 2007, we announced that the Board of Directors approved the repurchase of an additional 20,000,000 shares. Pursuant to this repurchase program, shares may be acquired in the open market or in privately negotiated transactions at our discretion, subject to market conditions and other factors.
	In July 2004, the Board of Directors authorized us to enter into agreements from time to time to extend our ongoing repurchase program to include repurchases during company announced “blackout periods” of such securities in compliance with Rule 10b5-1 promulgated under the Exchange Act.

29

On June 11, 2007, we entered into a stock purchase plan with Wachovia Securities to purchase up to 4,150,000 shares of SYSCO common stock pursuant to Rules 10b5-1 and 10b-18 under the Exchange Act. These shares were purchased pursuant to SYSCO’s previously announced share repurchase program. A total of 4,150,000 shares were purchased between June 11, 2007 and August 14, 2007, including during company “blackout periods.” By its terms, the agreement terminated on August 14, 2007.

On September 17, 2007 we entered into a stock purchase plan with Shields & Company to purchase up to 3,400,000 shares of SYSCO common stock pursuant to Rules 10b5-1 and 10b-18 under the Exchange Act. These shares will be purchased pursuant to SYSCO’s previously announced share repurchase programs. A total of 2,775,000 shares were purchased between September 17, 2007 and November 6, 2007, including during company “blackout periods.” By its terms, the agreement terminated on November 6, 2007.

As of November 6, 2007, there were 15,075,000 shares remaining available for repurchase under the publicly announced repurchase programs.

Item 3. Defaults upon Senior Securities

None

Item 4. Submission of Matters to a Vote of Security Holders

None

Item 5. Other Information

None

Item 6. Exhibits

     (a) Exhibits.

3.1	Restated Certificate of Incorporation, incorporated by reference to Exhibit 3(a) to Form 10-K for the year ended June 28, 1997 (File No. 1-6544).
3.2	Certificate of Amendment of Certificate of Incorporation increasing authorized shares, incorporated by reference to Exhibit 3(d) to Form 10-Q for the quarter ended January 1, 2000 (File No. 1-6544).
3.3	Certificate of Amendment to Restated Certificate of Incorporation increasing authorized shares, incorporated by reference to Exhibit 3(e) to Form 10-Q for the quarter ended December 27, 2003 (File No. 1-6544).
3.4	Form of Amended Certificate of Designation, Preferences and Rights of Series A Junior Participating Preferred Stock, incorporated by reference to Exhibit 3(c) to Form 10-K for the year ended June 29, 1996 (File No. 1-6544).
3.5	Amended and Restated Bylaws of Sysco Corporation dated May 11, 2007, incorporated by reference to Exhibit 3.5 to Form 8-K filed on May 15, 2007 (File No. 1-6544).

30

4.1	Senior Debt Indenture, dated as of June 15, 1995, between Sysco Corporation and First Union National Bank of North Carolina, Trustee, incorporated by reference to Exhibit 4(a) to Registration Statement on Form S-3 filed June 6, 1995 (File No. 33-60023).
4.2	Second Supplemental Indenture, dated as of May 1, 1996, between Sysco Corporation and First Union National Bank of North Carolina, Trustee as amended, incorporated by reference to Exhibit 4(f) to Form 10-K for the year ended June 29, 1996 (File No. 1-6544).
4.3	Third Supplemental Indenture, dated as of April 25, 1997, between Sysco Corporation and First Union National Bank of North Carolina, Trustee, incorporated by reference to Exhibit 4(g) to Form 10-K for the year ended June 28, 1997 (File No. 1-6544).
4.4	Fourth Supplemental Indenture, dated as of April 25, 1997, between Sysco Corporation and First Union National Bank of North Carolina, Trustee, incorporated by reference to Exhibit 4(h) to Form 10-K for the year ended June 28,1997 (File No. 1-6544).
4.5	Fifth Supplemental Indenture, dated as of July 27, 1998 between Sysco Corporation and First Union National Bank, Trustee, incorporated by reference to Exhibit 4(h) to Form 10-K for the year ended June 27, 1998 (File No. 1-6544).
4.6	Sixth Supplemental Indenture, including form of Note, dated April 5, 2002 between Sysco Corporation and Wachovia Bank, National Association (formerly First Union National Bank of North Carolina), as Trustee, incorporated by reference to Exhibit 4.1 to Form 8-K dated April 5, 2002 (File No. 1-6544).
4.7	Seventh Supplemental Indenture, including form of Note, dated March 5, 2004 between Sysco Corporation, as Issuer, and Wachovia Bank, National Association (formerly First Union National Bank of North Carolina), as Trustee, incorporated by reference to Exhibit 4(j) to Form 10-Q for the quarter ended March 27, 2004 (File No. 1-6544).
4.8	Eighth Supplemental Indenture, including form of Note, dated September 22, 2005 between Sysco Corporation, as Issuer, and Wachovia Bank, National Association, as Trustee, incorporated by reference to Exhibits 4.1 and 4.2 to Form 8-K filed on September 20, 2005 (File No. 1-6544).
4.9	Indenture dated May 23, 2002 between Sysco International, Co., Sysco Corporation and Wachovia Bank, National Association, incorporated by reference to Exhibit 4.1 to Registration Statement on Form S-4 filed August 21, 2002 (File No. 333-98489).
10.1#	Form of Commitment Increase Agreement dated September 25, 2007 by and among Sysco Corporation, JPMorgan Chase Bank, individually and as Administrative Agent, the Co-Syndication Agents named therein and the other financial institutions party thereto relating to the Credit Agreement dated November 4, 2005.

31

10.2#	Form of Extension Agreement effective September 21, 2007 by and among Sysco Corporation, JPMorgan Chase Bank, individually and as Administrative Agent, the Co-Syndication Agents named therein and the other financial institutions party thereto relating to the Credit Agreement dated November 4, 2005.
10.3#	Third Amendment to the Sixth Amended and Restated Sysco Corporation Supplemental Executive Retirement Plan.
10.4#	Form of Performance Unit Grant Agreement issued to executive officers effective September 28, 2007, under the 2004 Mid-Term Incentive Plan.
15.1#	Report from Ernst & Young LLP dated November 5, 2007, re: unaudited financial statements.
15.2#	Acknowledgment letter from Ernst & Young LLP.
31.1#	CEO Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2#	CFO Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1#	CEO Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2#	CFO Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

# Filed herewith

32

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

SYSCO CORPORATION (Registrant)
By	/s/ RICHARD J. SCHNIEDERS
	Richard J. Schnieders
	Chairman of the Board and Chief Executive Officer

Date: November 8, 2007

By	/s/ WILLIAM J. DELANEY
	William J. DeLaney
	Executive Vice President and Chief Financial Officer

Date: November 8, 2007

By	/s/ G. MITCHELL ELMER
	G. Mitchell Elmer
	Vice President, Controller and Chief Accounting Officer

Date: November 8, 2007

EXHIBIT INDEX

NO.	DESCRIPTION
3.1	Restated Certificate of Incorporation, incorporated by reference to Exhibit 3(a) to Form 10-K for the year ended June 28, 1997 (File No. 1-6544).
3.2	Certificate of Amendment of Certificate of Incorporation increasing authorized shares, incorporated by reference to Exhibit 3(d) to Form 10-Q for the quarter ended January 1, 2000 (File No. 1-6544).
3.3	Certificate of Amendment to Restated Certificate of Incorporation increasing authorized shares, incorporated by reference to Exhibit 3(e) to Form 10-Q for the quarter ended December 27, 2003 (File No. 1-6544).
3.4	Form of Amended Certificate of Designation, Preferences and Rights of Series A Junior Participating Preferred Stock, incorporated by reference to Exhibit 3(c) to Form 10-K for the year ended June 29, 1996 (File No. 1-6544).
3.5	Amended and Restated Bylaws of Sysco Corporation dated May 11, 2007, incorporated by reference to Exhibit 3.5 to Form 8-K filed on May 15, 2007 (File No. 1-6544).
4.1	Senior Debt Indenture, dated as of June 15, 1995, between Sysco Corporation and First Union National Bank of North Carolina, Trustee, incorporated by reference to Exhibit 4(a) to Registration Statement on Form S-3 filed June 6, 1995 (File No. 33-60023).
4.2	Second Supplemental Indenture, dated as of May 1, 1996, between Sysco Corporation and First Union National Bank of North Carolina, Trustee as amended, incorporated by reference to Exhibit 4(f) to Form 10-K for the year ended June 29, 1996 (File No. 1-6544).
4.3	Third Supplemental Indenture, dated as of April 25, 1997, between Sysco Corporation and First Union National Bank of North Carolina, Trustee, incorporated by reference to Exhibit 4(g) to Form 10-K for the year ended June 28, 1997 (File No. 1-6544).
4.4	Fourth Supplemental Indenture, dated as of April 25, 1997, between Sysco Corporation and First Union National Bank of North Carolina, Trustee, incorporated by reference to Exhibit 4(h) to Form 10-K for the year ended June 28,1997 (File No. 1-6544).
4.5	Fifth Supplemental Indenture, dated as of July 27, 1998 between Sysco Corporation and First Union National Bank, Trustee, incorporated by reference to Exhibit 4(h) to Form 10-K for the year ended June 27, 1998 (File No. 1-6544).
4.6	Sixth Supplemental Indenture, including form of Note, dated April 5, 2002 between Sysco Corporation and Wachovia Bank, National Association (formerly First Union National Bank of North Carolina), as Trustee, incorporated by reference to Exhibit 4.1 to Form 8-K dated April 5, 2002 (File No. 1-6544).

NO.	DESCRIPTION
4.7	Seventh Supplemental Indenture, including form of Note, dated March 5, 2004 between Sysco Corporation, as Issuer, and Wachovia Bank, National Association (formerly First Union National Bank of North Carolina), as Trustee, incorporated by reference to Exhibit 4(j) to Form 10-Q for the quarter ended March 27, 2004 (File No. 1-6544).
4.8	Eighth Supplemental Indenture, including form of Note, dated September 22, 2005 between Sysco Corporation, as Issuer, and Wachovia Bank, National Association, as Trustee, incorporated by reference to Exhibits 4.1 and 4.2 to Form 8-K filed on September 20, 2005 (File No. 1-6544).
4.9	Indenture dated May 23, 2002 between Sysco International, Co., Sysco Corporation and Wachovia Bank, National Association, incorporated by reference to Exhibit 4.1 to Registration Statement on Form S-4 filed August 21, 2002 (File No. 333-98489).
10.1#	Form of Commitment Increase Agreement dated September 25, 2007 by and among Sysco Corporation, JPMorgan Chase Bank, individually and as Administrative Agent, the Co-Syndication Agents named therein and the other financial institutions party thereto relating to the Credit Agreement dated November 4, 2005.
10.2#	Form of Extension Agreement effective September 21, 2007 by and among Sysco Corporation, JPMorgan Chase Bank, individually and as Administrative Agent, the Co-Syndication Agents named therein and the other financial institutions party thereto relating to the Credit Agreement dated November 4, 2005.
10.3#	Third Amendment to the Sixth Amended and Restated Sysco Corporation Supplemental Executive Retirement Plan.
10.4#	Form of Performance Unit Grant Agreement issued to executive officers effective September 28, 2007, under the 2004 Mid-Term Incentive Plan.
15.1#	Report from Ernst & Young LLP dated November 5, 2007, re: unaudited financial statements.
15.2#	Acknowledgment letter from Ernst & Young LLP.
31.1#	CEO Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2#	CFO Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1#	CEO Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2#	CFO Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

# Filed herewith.

EX-10.1

Exhibit 10.1

     COMMITMENT INCREASE AGREEMENT dated as of September 25, 2007, among SYSCO CORPORATION (the “Company”), the INCREASING LENDERS party hereto and JPMORGAN CHASE BANK, N.A., as U.S. administrative agent (the “U.S. Administrative Agent”) under the Credit Agreement referred to below.

     Reference is made to the Credit Agreement dated as of November 4, 2005 (the “Credit Agreement”), among the Company, SYSCO International, Co., the lenders party thereto, the U.S. Administrative Agent and JPMorgan Chase Bank, N.A, Toronto Branch, as Canadian Administrative Agent. Capitalized terms used and not defined herein have the meanings specified in the Credit Agreement.

     The Company has notified the U.S. Administrative Agent in accordance with Section 2.20 of the Credit Agreement of its request that the U.S. Commitments be increased by US$250,000,000, and the Persons identified on Schedule I hereto (the “Increasing Lenders”) have agreed to provide such increased U.S. Commitments in the respective amounts set forth on Schedule I hereto for each such Increasing Lender. The Increase Effective Date of the Commitment Increase contemplated hereby is scheduled to occur on September 25, 2007, and the parties hereto are entering into this Agreement in order to provide for such Commitment Increase.

     NOW, THEREFORE, the parties hereto hereby agree as follows:

     SECTION 1. On and as of September 25, 2007, the U.S. Commitment and each Increasing Lender shall be increased by the amount set forth with respect to such Increasing Lender on Schedule I hereto, subject to satisfaction of the conditions referred to in Section 2 below.

     SECTION 2. The Commitment Increase provided for herein shall be subject to the satisfaction of the conditions set forth in Section 2.20(d) of the Credit Agreement.

     SECTION 3. (a) Notices hereunder shall be given as provided in the Credit Agreement.

     (b) This Agreement may not be waived, amended or modified in except pursuant to an agreement or agreements in writing entered into by all parties hereto.

     (c) This Agreement constitutes an amendment to the Credit Agreement and, accordingly, Section 10.03 of the Credit Agreement shall apply hereto.

     (d) This Agreement may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. Delivery of an executed counterpart of a signature page of this Agreement by telecopy shall be effective as delivery of a manually executed counterpart of this Agreement.

     (e) This Agreement shall be construed, and the rights of the parties determined, in accordance with and governed by the law of the State of New York.

     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective authorized officers as of the day and year first above written.

SYSCO CORPORATION,
	by
		Name: Kathy Oates Gish
		Title: Vice President and Assistant Treasurer
	JPMORGAN CHASE BANK, N.A., individually and as U.S. Administrative Agent,
	by
		Name: Christine Herrick
		Title: Vice President

SIGNATURE PAGE TO THE COMMITMENT INCREASE AGREEMENT AMONG SYSCO CORPORATION, THE INCREASING LENDERS PARTY HERETO AND JPMORGAN CHASE BANK, N.A., AS U.S. ADMINISTRATIVE AGENT,
Name of Institution:
by
	Name:
	Title:

SCHEDULE I

Increasing Lender	U.S. Commitment Increase Amount
JPMorgan Chase Bank, N.A.	$	25,000,000
Bank of America, N.A.	$	25,000,000
Barclays Bank PLC	$	25,000,000
The Bank of Tokyo-Mitsubishi UFJ, Ltd.	$	25,000,000
Wachovia Bank, National Association	$	25,000,000
Wells Fargo Bank N.A.	$	25,000,000
Toronto-Dominion (Texas) LLC	$	25,000,000
Branch Banking and Trust Company	$	22,500,000
Comerica Bank	$	12,500,000
PNC Bank, National Association	$	12,500,000
William Street Commitment Corporation	$	12,500,000
The Northern Trust Company	$	10,000,000
Zions First National Bank	$	5,000,000
	$	250,000,000

EX-10.2

Exhibit 10.2

EXTENSION AGREEMENT

JPMorgan Chase Bank, N.A.,
   As U.S. Administrative Agent
   under the Credit Agreement
   referred to below
270 Park Avenue
New York, NY 10017

Gentlemen:

     The undersigned hereby agrees to extend, effective September 21, 2007, the Maturity Date under the Credit Agreement dated as of November 4, 2005 (as amended from time to time, the “Credit Agreement”) among SYSCO Corporation, a Delaware corporation (the “Company”), SYSCO International, Co., the Lenders party thereto, JPMorgan Chase Bank, N.A., as U.S. Administrative Agent (the “U.S. Administrative Agent”), JPMorgan Chase Bank, N.A., Toronto Branch, as Canadian Administrative Agent, for one year to November 4, 2012. Terms defined in the Credit Agreement are used herein with the same meaning.

     This Extension Agreement shall be construed in accordance with and governed by the laws of the State of New York.

Lender:
By:
	Name:
	Title:

Agreed and accepted:
SYSCO CORPORATION
By:
	Name:
	Title:
JPMORGAN CHASE BANK, N.A., as U.S.     Administrative Agent
By:
	Name:
	Title:

EX-10.3

Exhibit 10.3

THIRD AMENDMENT TO
THE SIXTH AMENDED AND RESTATED
SYSCO CORPORATION
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

     THIS THIRD AMENDMENT TO THE SIXTH AMENDED AND RESTATED SYSCO CORPORATION SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN (this “Amendment”).

     WHEREAS, Sysco Corporation (the “Company”) has adopted that certain Sixth Amended and Restated Sysco Corporation Supplemental Executive Retirement Plan (the “Plan”) pursuant to a plan document effective generally as of January 1, 2005; and

     WHEREAS, the Board of Directors of the Company has determined to amend the Plan to change its definition of “Eligible Earnings” to exclude any amounts payable to participants under the Sysco Corporation 2006 Supplemental Performance Based Bonus Plan and certain additional bonuses paid to participants under the fiscal incentive programs of the Sysco Corporation Management Incentive Plan.

     NOW, THEREFORE, the Plan is hereby amended as follows, effective as of July 1, 2007:

     (Capitalized terms used but not otherwise defined herein shall have the meaning given them in the Plan.)

     1. Article I of the Plan is hereby amended by deleting the definition of “Eligible Earnings” in its entirety and replacing it with the following:

Eligible Earnings. “Eligible Earnings” means:

          (a) (i) the salary, plus (ii) any amount under the Management Incentive Plan, that is paid to a Participant by the Company with respect to a given Plan Year ending prior to July 3, 2005 (including any amount deferred under the Sysco Corporation Executive Deferred Compensation Plan).

          (b) (i) the salary, plus (ii) any amount under the Management Incentive Plan, that is paid to a Participant by the Company with respect to a given Plan Year ending after July 2, 2005 but ending prior to July 1, 2007 (including any amounts deferred under the Sysco Corporation Executive Deferred Compensation Plan, and excluding any amounts related to “Additional Shares” or “Additional Cash Bonus” (as such terms are defined in the Management Incentive Plan)); and (iii) any amount under the Sysco Corporation 2006 Supplemental Performance Based Bonus Plan, as may be amended from time to time, and any successor plan, that is paid to a Participant by the Company with respect to a given Plan Year ending after July 1, 2006 but ending prior to July 1, 2007.

          (c) (i) the salary, plus (ii) any amount under the Management Incentive Plan, that is paid to a Participant by the Company with respect to a given Plan Year ending after June 30, 2007 (including any amount deferred under the Sysco Corporation Executive Deferred Compensation Plan, and excluding any amounts related to “Additional Shares” or the MIP Additional Bonuses).

          (d) Notwithstanding (a), (b), and (c), above, for purposes of calculating a Protected Participant’s Protected Benefit, “Eligible Earnings” shall have the meaning set forth in (a), above, except that (i) the Plan Year date restrictions set forth therein shall not apply (i.e., the Eligible Earnings definition set forth in (a) shall apply without regard to when such amounts were paid or earned); and (ii) for Plan Years ending after June 30, 2007, “Eligible Earnings” shall exclude amounts related to the MIP Additional Bonuses.

     2. Article I of the Plan is hereby amended by addition of the following definition of MIP Additional Bonuses.

     “MIP Additional Bonuses.” “MIP Additional Bonuses” means the sum of those certain additional bonuses payable to participants under the Management Incentive Plan pursuant to the fiscal year incentive programs under the Management Incentive Plan, more specifically referred to as the “Big 5 Enterprise Bonus”, the “Organizational Alignment Bonus Program”, the “Additional Bonus for Management Development” and the “Additional Bonus for Foldout Company Support” or any similar bonus program adopted by the Company under the Management Incentive Plan. For purposes of this definition, MIP Additional Bonuses shall include amounts paid to participants in the Management Incentive Plan in addition to their regular Management Incentive Plan bonuses and shall not include reductions in a Management Incentive Plan participant’s regular Management Incentive Plan bonuses as a result of a Participant’s performance for such fiscal year being below expectations.

     3. Except as specifically amended hereby, the Plan shall remain in full force and effect as prior to this Amendment.

     IN WITNESS WHEREOF, the Company has caused this Third Amendment to be executed this 28th day of September, 2007 effective as of the 1st day of July, 2007.

SYSCO CORPORATION
By: Name: Title:	/s/ Michael C. Nichols Michael C. Nichols Sr. Vice President, General Counsel and Secretary

ATTEST:
By: Name: Title:	/s/ Thomas P. Kurz Thomas P. Kurz Assistant Vice President and Deputy General Counsel

2

EX-10.4

Exhibit 10.4

Form of Grant Agreement Letter to
Corporate Participants¹
Under the SYSCO Corporation 2004 Mid-Term Incentive Plan

September 28, 2007

PERSONAL AND CONFIDENTIAL

[Name]
[Street Address]
[City, State, Zip]

Dear [Grantee]:

In recognition of your long-term commitment to SYSCO and its customers and of your expected future contributions to our corporate financial objectives, you have been granted [                    ] “performance units” under the SYSCO Corporation 2004 Mid-Term Incentive Plan (the “Plan”). The value assigned to each of your performance units is $35.00.

Subject to the terms and conditions of the Plan, these performance units represent your right to receive a cash bonus of up to 150% of the total value of your units, consisting of two components. Any bonus payable will equal the sum of:

(A) up to 75% of the total value of your units, if and to the extent that SYSCO attains certain increases in net earnings per share during the “performance period” (July 1, 2007 through July 3, 2010), set by the Compensation Committee of SYSCO’s Board of Directors; plus

(B) up to 75% of the total value of your units, if and to the extent that SYSCO attains certain increases in sales during the performance period, set by the Compensation Committee.

Enclosed for your review are copies of the Plan document, a beneficiary designation form, instructions for completing the beneficiary designation form and other explanatory materials. All of the enclosed documents are important legal documents that should be reviewed carefully and kept in a safe place. If you are a new participant or would like to change your designated beneficiary under the Plan, please complete the enclosed beneficiary designation form as soon as possible, and return it to Connie Brooks. If you completed the beneficiary designation form last year, you do not have to complete it again this year unless you want to change your designated beneficiary.

Thank you for your hard work and service. Your efforts, which are an integral part of SYSCO’s growth and progress, are deeply appreciated. If you should have any questions about your performance unit grant or the Plan, please contact Mike Nichols.

Sincerely,

William Delaney
Executive Vice President, Finance
and Chief Financial Officer

¹ All Named Executive Officers are Corporate Participants under the Plan.

FISCAL YEAR 2008

MID-TERM INCENTIVE PROGRAM

[Performance Period Fiscal 2008-2010]

Adopted Effective September 18, 2007

     This Fiscal Year 2008 Mid-Term Incentive Program (the “Program”) was adopted pursuant to the Sysco Corporation 2004 Mid-Term Incentive Plan (the “Plan”) by the Committee (as defined in the Plan) of Sysco Corporation (the “Company”) effective September 18, 2007. This Program is for the Performance Period commencing July 1, 2007 and ending July 3, 2010 (the “Performance Period”). Capitalized terms used but not otherwise defined herein shall have the meanings given them in the Plan.

     1. Participants. The participants (“Participants”) in the Program are as follows:

          Subsidiary Participants. Persons determined by the Chairman, Chief Executive Officer or Chief Operating Officer (individually, a “Senior Officer”) who also serve as an officer of an operating division or subsidiary of the Company (individually, a “Subsidiary”) regardless of whether such Participant is employed by a Subsidiary of the Company. The Payment Amount for a Subsidiary Participant shall be determined using Table A, as is more fully described in Section 3 hereof.

          Corporate Participants. Those persons on the attached list and other persons designated by a Senior Officer who (i) serve as an officer of the Company and (ii) are also employees of the Company or a Subsidiary. The Payment Amount for a Corporate Participant shall be determined using Table B, as is more fully described in Section 3 hereof.

          Designated Participants. Persons other than Subsidiary Participants or Corporate Participants who are employed by a Subsidiary or by the corporate office of the Company who are designated by the Committee. The Payment Amount for a Designated Participant shall be determined using Table A if the Committee determines that such Designated Participant’s Performance Goals are to be measured by the performance of one or more Subsidiaries, or Table B if the Committee determines that such Designated Participant’s Performance Goals are to be measured by the performance of the Company, in each case as is more fully described in Section 3 hereof.

     2. Definitions.

          (a) For Calculations Regarding Table A attached hereto:

               (i) Increase in Operating Pretax Earnings. Except as provided in Section 2(a)(ii), the Increase in Operating Pretax Earnings (“OPTE”) for the Performance Period is equal to the average of the percentage change in OPTE calculated for each Fiscal Year ending during the Performance Period. The percentage change in OPTE for each Fiscal Year is computed by comparing the Subsidiary’s OPTE for the relevant Fiscal Year (the calculation of which does not include gain on the sale of fixed assets and is subject to other adjustments determined by the Committee) to the Subsidiary’s OPTE for the prior Fiscal Year; provided, however, that no more than a thirty-percent (30%) increase in the OPTE for any Fiscal Year

during a Performance Period shall be taken into account in determining the Increase in OPTE for such Performance Period.

               (ii) Increase in OPTE for Performance Periods with Negative Growth Year. Notwithstanding Section 2(a)(i), in the event that a Subsidiary’s OPTE for any Fiscal Year during the Performance Period is less than the Subsidiary’s OPTE for the immediately preceeding Fiscal Year (such Fiscal Year with the lower OPTE is hereneafter referred to as (a “Negative Growth Year”)), the Increase in the OPTE for the Performance Period containing the Negative Growth Year shall be calculated as the ratio of (A) divided by (B), where (A) is the average of the sum of the actual amount of the increase(s) or decrease(s) in the OPTE for the Fiscal Years in such Performance Period and (B) is the OPTE for the Fiscal Year immediately prior to the first Fiscal Year of the applicable Performance Period. The calculation of the OPTE for any Fiscal Year does not include gain on the sale of fixed assets and is subject to other adjustments determined by the Committee.

               (iii) Foldout Companies. For purposes of calculating the increase in OPTE with respect to a foldout company (“Foldout”) under 2(a)(i) and 2(a)(ii) above, the OPTE of the Foldout for its first Fiscal Year shall be ignored, and the Performance Period shall be deemed to contain two Fiscal Years.

               (iv) Specialty Company Adjustment. Operating pretax earnings for Specialty Companies will be adjusted to consolidate the pro forma earnings generated on sales by Traditional Broadline Companies of such Specialty Company’s products.

               (v) Specialty Company. A Subsidiary that is not a Traditional Broadline Company. Specialty Companies include Guest Supply, Specialty Meat Companies and Specialty Produce Companies.

               (vi) Specialty Meat Company. A Subsidiary that specializes in specialty meat operations.

               (vii) Specialty Produce Company. A Subsidiary that specializes in specialty produce operations.

               (viii) Traditional Broadline Company. A Subsidiary that is not a Specialty Company.

               (ix) Percentage Change in Sales. Shall equal the average of the percentage change in sales (whether positive or negative for any Fiscal Year of the Subsidiary) calculated for each Fiscal Year ending during the Performance Period. The percentage change in sales for each Fiscal Year is computed by comparing the Subsidiary’s sales for the relevant Fiscal Year to the Subsidiary’s sales for the prior Fiscal Year. Sales shall be determined in accordance with U.S. generally accepted accounting principles (GAAP).

2

          (b) For Calculations Regarding Table B attached hereto:

               (i) Increase in Net Earnings Per Share. The Increase in Net Earnings Per Share (“EPS”) for the Performance Period is equal to the average change in EPS calculated for each Fiscal Year ending during the Performance Period. The change in EPS for each Fiscal Year is computed by comparing EPS for the relevant Fiscal Year to the Company’s EPS for the prior Fiscal Year.

               (ii) Percentage Change in Sales. Shall equal the average of the percentage change in sales (whether positive or negative for any Fiscal Year of the Company) calculated for each Fiscal Year ending during the Performance Period. The percentage change in sales for each Fiscal Year is computed by comparing the Company’s sales for the relevant Fiscal Year to the Company’s sales for the prior Fiscal Year. Sales shall be determined in accordance with U.S. generally accepted accounting principles (GAAP).

          (c) Fiscal Years. For purposes of this Performance Period, Fiscal Years shall mean the fiscal years of the Company.

     3. Method of Operation.

          (a) In General. Subject to the discretion of the Committee to formulate different Performance Goals as to any Participant other than Covered Employees, the Payment Amount which a Participant can earn with respect to Performance Units under the Plan is based on (i) the performance of the Company as a whole, (ii) the performance of the Subsidiary which employs such Participant, (iii) the performance of the Subsidiary designated by the Committee as the Subsidiary by reference to which the bonus is to be determined (as to Subsidiary Participants and Designated Participants), or (iv) the performance of a select group of Subsidiaries (as to Corporate Participants and possibly Designated Participants). Except as otherwise provided in the Plan, the Payment Amount is calculated with respect to the entire Performance Period. If earned, the Payment Amount shall be paid in accordance with the Plan.

          (b) Payment Amount.

               (i) Subsidiary Participant. Subject to Section 3(i), for each Subsidiary Participant, the Payment Amount is the sum of (A) the Earnings Growth Payment Amount and (B) the Sales Growth Payment Amount, determined as follows:

Earnings Growth Payment Amount

Number of
Performance
Units Granted
to Participant X Unit
Value X Applicable
Percentage
Determined
Under Part I of
Table A X 50% = Earnings Growth
Payment Amount

3

Sales Growth Payment Amount

Number of
Performance
Units Granted
to Participant X Unit
Value X Applicable
Percentage
Determined
Under Part II of
Table A X 50% = Sales Growth
Payment Amount

               (ii) Corporate Participant. For each Corporate Participant, the Payment Amount is the sum of (A) the Earnings Growth Payment Amount and (B) the Sales Growth Payment Amount, determined as follows:

Earnings Growth Payment Amount

Number of
Performance
Units Granted
to Participant X Unit
Value X Applicable
Percentage
Determined
Under Part I of
Table B X 50% = Earnings Growth
Payment Amount

Sales Growth Payment Amount

Number of
Performance
Units Granted
to Participant X Unit
Value X Applicable
Percentage
Determined
Under Part II of
Table B X 50% = Sales Growth
Payment Amount

          (c) Performance Goals Measured by Performance of Subsidiaries. With respect to each Participant whose Performance Goals are measured by the performance of a Subsidiary, the Applicable Percentage shall be determined on the basis of the results of the operations of that Subsidiary during the Performance Period as shown on Table A attached hereto and made a part hereof.

          (d) Performance Goals Measured by Performance of the Company. With respect to each Participant whose Performance Goals are measured by the performance of the Company, the Applicable Percentage shall be determined on basis of the results of operations of the Company during the Performance Period as shown on Table B attached hereto and made a part hereof.

          (e) Performance Goals for Transferred Participants. If a Participant transfers employment between the Company and a Subsidiary or a Subsidiary and another Subsidiary (a “Transferred Participant”), the Transferred Participant’s Performance Goals shall be measured by the performance of the Company or Subsidiary, as applicable, for which the Transferred Participant that has been employed for the greatest number of business days during the Performance Period.

          (f) Unit Value. The Unit Value for the Performance Period is $35.00.

          (g) General Rules Regarding Bonus Calculation. In determining whether or not the results of operations of a Subsidiary (or group of Subsidiaries) or the Company for the

4

Performance Period satisfy the Performance Goals, except as otherwise provided herein Company accounting practices and generally accepted accounting principles shall be applied on a basis consistent with prior periods, and such determination shall be based on the calculations made by the Company, approved (in the case of Covered Employees) by the Committee and binding on each Participant.

          (h) Tax Law Changes. If the Code is amended during a Fiscal Year and, as a result of such amendment(s), the effective tax rate applicable to the earnings of the Company (as described in the “Summary of Accounting Policies” section of the Company’s annual report to the Securities and Exchange Commission on Form 10-K) changes during a Fiscal Year, the calculation of the EPS of the Company for the Fiscal Year in which such rate change becomes effective (the “Rate Change Year”) shall be made as if such rate change had not occurred during the Rate Change Year. For the Fiscal Year following the Rate Change Year, the calculation of the EPS of the Company shall be made after taking into account such rate change, and shall be compared, for purposes of computing the appropriate change in EPS for such Fiscal Year, with the EPS of the Company for the Rate Change Year, computed after taking into account such rate change.

          (i) No Payment Amount for Certain Subsidiary Participants. In the event that during any Fiscal Year a Subsidiary has an operating loss (a “Loss Year”), then neither the President nor the Executive President(s) who are Subsidiary Participants with respect to such Subsidiary shall be entitled to a Payment Amount for the Performance Period containing such Loss Year.

     4. Payment. Within 90 days after the end of the Performance Period, the Company shall determine, and, in the case of Covered Employees, the Committee shall approve, the Payment Amount to be made for Performance Units awarded under the Plan and earned by each Participant pursuant to the provisions of Section 3 above. Such bonus shall be payable in cash as provided in the Plan, and shall be paid no later than the last day of the fourth month following the end of the Performance Period (the “Payment Date”).

     5. Overall Limitation Applicable to Covered Employees. Notwithstanding any other provision in this Program to the contrary, in no event shall any Covered Employee be entitled to a Payment Amount for any Performance Period in excess of one percent (1%) of the Company’s earnings before income taxes as publicly disclosed in the “Consolidated Results of Operations” section of the Company’s annual report to the Securities and Exchange Commission on Form 10-K for the Fiscal Year ending in 2010.

     6. Delegation of Authority. Pursuant to Section 8.1 of the Plan, the Committee hereby delegates discretionary authority granted to the Committee under this Program as well as under the Plan to the Senior Officers and each of them individually, except as to Covered Employees.

5

Exhibit 1

TABLE A

FISCAL YEAR 2008

MID-TERM INCENTIVE PLAN

(Performance Period Fiscal 2008-2010)

OPERATIONS OF THE SUBSIDIARY

PART I: GROWTH IN OPERATING PRE-TAX EARNINGS

	Threshold																								Target																								Maximum
Percentage
Increase
in Operating
Pre-Tax
Earnings	6-6.49			6.5-6.99			7-7.49			7.5-7.99			8-8.49			8.5-8.99			9-9.49			9.5-9.99			10-10.49			10.5-10.99			11-11.49			11.5-11.99			12-12.49			12.5-12.99			13-13.49			13.5-13.99			14+
Applicable Percentage		50	%		56.3	%		62.5	%		68.8	%		75.0	%		81.3	%		87.5	%		93.8	%		100.0	%		106.3	%		112.5	%		118.8	%		125.0	%		131.3	%		137.5	%		143.8	%		150.0	%

PART II: GROWTH IN SALES

	Threshold																								Target																								Maximum
Percentage
Change in
Sales	6-6.24			6.25-6.49			6.5-6.74			6.75-6.99			7.00-7.24			7.25-7.49			7.50-7.74			7.75-7.99			8.00-8.24			8.25.8.49			8.50-8.84			8.85-8.99			9.00-9.24			9.25-9.49			9.50-9.94			9.95-9.99			10+
Applicable Percentage		50	%		56.3	%		62.5	%		68.8	%		75.0	%		81.3	%		87.5	%		93.8	%		100.0	%		106.3	%		112.5	%		118.8	%		125.0	%		131.3	%		137.5	%		143.8	%		150.0	%

6

Exhibit 2

TABLE B

FISCAL YEAR 2008

MID-TERM INCENTIVE PLAN

(Performance Period Fiscal 2008-2010)

OPERATIONS OF THE COMPANY

PART I: GROWTH IN NET EARNINGS PER SHARE

	Threshold																								Target																								Maximum
Percentage
Increase in
Net Earnings
per Share	6-6.49			6.5-6.99			7-7.49			7.5-7.99			8-8.49			8.5-8.99			9-9.49			9.5-9.99			10-10.49			10.5-10.99			11-11.49			11.5-11.99			12-12.49			12.5-12.99			13-13.49			13.5-13.99			14+
Applicable Percentage		50	%		56.3	%		62.5	%		68.8	%		75.0	%		81.3	%		87.5	%		93.8	%		100.0	%		106.3	%		112.5	%		118.8	%		125.0	%		131.3	%		137.5	%		143.8	%		150.0	%

PART II: GROWTH IN SALES

	Threshold																								Target																								Maximum
Percentage
Change in
Sales	6-6.24			6.25-6.49			6.5-6.74			6.75-6.99			7.00-7.24			7.25-7.49			7.50-7.74			7.75-7.99			8.00-8.24			8.25.8.49			8.50-8.84			8.85-8.99			9.00-9.24			9.25-9.49			9.50-9.94			9.95-9.99			10+
Applicable Percentage		50	%		56.3	%		62.5	%		68.8	%		75.0	%		81.3	%		87.5	%		93.8	%		100.0	%		106.3	%		112.5	%		118.8	%		125.0	%		131.3	%		137.5	%		143.8	%		150.0	%

7

EX-15.1

Exhibit 15.1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders
SYSCO Corporation

We have reviewed the consolidated balance sheets of SYSCO Corporation (a Delaware Corporation) and subsidiaries (“the Company”) as of September 29, 2007 and September 30, 2006, and the related consolidated results of operations, consolidated cash flows and statements of comprehensive income for the thirteen week periods ended September 29, 2007 and September 30, 2006. These financial statements are the responsibility of the Company’s management.

We conducted our review in accordance with the standards of the Public Company Accounting Oversight Board (United States). A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the Public Company Accounting Oversight Board, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material modifications that should be made to the condensed consolidated financial statements referred to above for them to be in conformity with U.S. generally accepted accounting principles.

We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheet of SYSCO Corporation and subsidiaries as of June 30, 2007, and the related consolidated results of operations, shareholders’ equity, and cash flows for the year then ended (not presented herein) and in our report dated August 27, 2007, we expressed an unqualified opinion on those consolidated financial statements and included an explanatory paragraph relating to the Company’s adoption of Statement of Financial Accounting Standard No. 158, “Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans – an amendment of FASB Statements No. 87, 88, 106, and 132(R)” which was effective June 30, 2007, and Financial Accounting Standards Board Statement No. 123(R), “Share Based Payment”, which was effective July 3, 2005.

In our opinion, the information set forth in the accompanying consolidated balance sheet as of June 30, 2007, is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived.

/s/ Ernst & Young LLP

Houston, Texas
November 5, 2007

EX-15.2

Exhibit 15.2

To the Shareholders and Board of Directors
Sysco Corporation

We are aware of the incorporation by reference of our report dated November 5, 2007 relating to the unaudited consolidated interim financial statements of SYSCO Corporation that are included in its Form 10-Q for the quarter ended September 29, 2007 in the following registration statements.

SYSCO Corporation Form S-3	File No. 333-124166
SYSCO Corporation Form S-3	File No. 333-126199
SYSCO Corporation Form S-4	File No. 333-50842
SYSCO Corporation Form S-8	File No. 33-45820
SYSCO Corporation Form S-8	File No. 333-01259
SYSCO Corporation Form S-8	File No. 333-01255
SYSCO Corporation Form S-8	File No. 333-27405
SYSCO Corporation Form S-8	File No. 333-66987
SYSCO Corporation Form S-8	File No. 333-49840
SYSCO Corporation Form S-8	File No. 333-58276
SYSCO Corporation Form S-8	File No. 333-122947
SYSCO Corporation Form S-8	File No. 333-129671

/s/ Ernst & Young LLP

Houston, Texas
November 5, 2007

EX-31.1

Exhibit 31.1

CERTIFICATION

I, Richard J. Schnieders, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Sysco Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operation and cash flows of the registrant as of, and for, the periods presented in this report.

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 8, 2007

/s/ RICHARD J. SCHNIEDERS  

Richard J. Schnieders 

Chairman of the Board and
Chief Executive Officer 

EX-31.2

Exhibit 31.2

CERTIFICATION

I, William J. DeLaney, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Sysco Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operation and cash flows of the registrant as of, and for, the periods presented in this report.

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 8, 2007

/s/ WILLIAM J. DELANEY  

William J. DeLaney 

Executive Vice President and
Chief Financial Officer 

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO SECTION 906 OF THE
SARBANES-OXLEY ACT OF 2002

I, Richard J. Schnieders, Chairman of the Board and Chief Executive Officer of Sysco Corporation (the “company”), certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge:

1. The company’s Quarterly Report on Form 10-Q for the quarterly period ended September 29, 2007 (“Quarterly Report”) fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934; and

2. All of the information contained in the Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of the company.

Date: November 8, 2007

/s/ RICHARD J. SCHNIEDERS  

Richard J. Schnieders 

Chairman of the Board and
Chief Executive Officer 

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO SECTION 906 OF THE
SARBANES-OXLEY ACT OF 2002

I, William J. DeLaney, Executive Vice President and Chief Financial Officer of Sysco Corporation (the “company”), certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of my knowledge:

1. The company’s Quarterly Report on Form 10-Q for the quarterly period ended September 29, 2007 (“Quarterly Report”) fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934; and

2. All of the information contained in the Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of the company.

Date: November 8, 2007

/s/ WILLIAM J. DELANEY  

William J. DeLaney 

Executive Vice President and
Chief Financial Officer