Good day, everyone, and welcome to the Sysco Corp. Fiscal Report Second Quarter Fiscal 2012 Earnings Conference Call. Today's conference is being recorded. At this time, I'd like to turn the conference over to Mr. Neil Russell. Please go ahead.

Thank you, operator, and good morning, everyone. Thank you for joining us for Sysco's Second Quarter 2012 Conference Call. On today's call, you will hear from Bill DeLaney, our President and Chief Executive Officer; and Chris Kreidler, our Chief Financial Officer. Before we begin, please note that statements made in the course of this presentation that state the company's or management's intentions, beliefs, expectations or predictions of the future are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results could differ in a material manner. Additional information concerning factors that could cause actual results to differ in a material manner from those in the forward-looking statements is contained in the company's SEC filings, including, but not limited to, risk factors contained in the company's annual report on Form 10-K for the year ended July 2, 2011, and in the company's press release issued earlier this morning. On the call today, if you've joined us via webcast, you'll notice that we are once again augmenting our comments with a slide presentation. You can download a copy of the presentation by going to the Investors section of sysco.com. This presentation was also filed with the SEC on Form 8-K this morning. Non-GAAP financial measures are included in our comments today and in the presentation slides. The reconciliation of these non-GAAP measures to the applicable GAAP measures are included at the end of the presentation and can also be found in the Investors section of our website. All comments about earnings per share refer to diluted earnings per share unless otherwise noted. In addition, all references to case volume growth include total Broadline and SYGMA combined. Lastly, as many of you know, we will be hosting our Investor Day on May 17 in New York City. Additional information will be provided in the next couple of weeks. At this time, I'd like to turn the call over to our President and Chief Executive Officer, Bill DeLaney.

Thank you, Neil, and good morning, everyone. This morning, Sysco reported sales of $10.2 billion for the second quarter, a 9.2% increase. Net earnings for the quarter were $250 million, and EPS was $0.43. Excluding the year-over-year impact of gross business transformation expenses and COLI investment income, EPS was $0.46. On this basis, which we believe is more representative of the performance of our underlying business, EPS grew 2.2% for the quarter. Overall market conditions remained soft for much of the second quarter but appeared to strengthen during the holiday season. Our case growth trends improved as the quarter progressed, as we aggressively supported our customers, protected our business, grew our share of wallet with existing customers and brought on new accounts. As a result, case volume growth during the second quarter was 2.8% excluding the impact of acquisitions and 3.6% including acquisitions. Based on recent industry data, we believe we grew our market share by about half -- excuse me, by about 0.5 point during calendar year 2011 to approximately 17.5%. Food cost inflation remained at historically high levels and approximated 6.3% for the quarter. While slightly lower than the level we experienced in the first quarter, this type of inflationary environment is difficult for our customers and provides us with significant pricing challenges. Although we are encouraged by our recent volume growth trends, earnings growth from our underlying business for the quarter fell short of our expectations as expenses grew at a faster rate than did gross profit dollars. Our leadership team is addressing the internal factors that limited our earnings growth, and we expect to see gradual improvement over the next few quarters. In addition, we are currently developing several key strategic initiatives that will better position Sysco to profitably grow our market share in the years…

Thanks, Bill, and good morning, everyone. For the second quarter, sales were $10.2 billion or an increase of 9.2% compared to the prior year, driven mainly by food cost inflation, which we estimated to be 6.3% for the period. In addition, acquisitions within the last 12 months increased sales by 0.7%, and changes in foreign exchange rates decreased sales by 0.1%. Case volume for the quarter increased 3.6% year-over-year including acquisitions or 2.8% excluding acquisitions. We saw solid increases in volumes across all areas of our business. Gross profit increased 4.8% during the quarter. Even though gross margin decreased 75 basis points year-over-year to 18%, gross profit dollars per stop and per case increased once again. Operating expenses increased $94 million or 7.1% in the second quarter of fiscal 2012 compared to the prior year period. The increase in operating expenses was primarily the result of a $58 million increase in salaries and related costs. The most significant factor impacting this variance was an $18 million increase in management incentive accruals. And last year's second quarter, we had reduced these performance-based accruals, which now creates a meaningful year-over-year difference when compared to this year's accrual. In addition, we saw increases in salaries and related expense due to delivery and sales compensation, acquisitions and volume growth that has increased pay for activity-based positions. Also impacting operating expenses were a $12 million increase in gross business transformation expenses, a $10 million increase in fuel expense. It's important to note that fuel surcharges offset this increase, although they are reflected in gross profits, and a $9 million lower benefit from COLI. These operating expense items were partially offset by a $7 million decrease in expense related to the company's corporate-sponsored pension plan. Reported operating income decreased $10 million or 2.3%, and net earnings…

[Operator Instructions] We'll have our first question from John Heinbockel, Guggenheim Securities.

A couple of things. So first thing, so business picked up towards the end of the quarter. Has that continued thus far in January? Obviously, weather has been good in a lot of parts of the country, and sentiment has been good. So has that persisted here or have we slid back?

I'd say it's persisted. It's early, John. You know us real well so you know this quarter is a hard quarter to trend line anything this early. March drives the disproportionate amount of the volume and the earnings for the quarter. But there's some phenomenons going on. You haven't heard us talk much about whether last year or this year in terms of it hurting us or helping us. I would say a couple of things this year, we had some bad weather where you normally don't have bad weather last year in the south, so that's going to help us here or did help us in January. We did have the holiday kick in into the first quarter, so those kind of offset. So I'd say net-net, the weather has been good relative to last year. The only caveat to that would be, we haven't seen a lot of snow in some of the ski resort areas. So some of those opcos that depend on that business side, they're not seeing that. But net-net, I would say the trends have continued on the top line.

And then the -- so you talk about things you can do to improve profitability near and long term. So talk about 2 things, one, away from SAP, where do you think there might be some cost containment opportunity? And then secondly, is there anything pre-SAP that can be done on pricing in terms of, well, you may not be optimizing your pricing geographically by customer category, whatever?

Okay. Well, those may connect here. If I don't handle the second one, come back to me on that. So what I'm really alluding to there, John, as you look at this thing, clearly, this isn’t a typical Sysco quarter in terms of what we were able to leverage or not leverage. And so in the short term, there are just some basic things that we need to readdress and to bring a little bit more intensity to. So basically, we need to flip the gross profit dollar growth and the expense growth. So if we can get to where the gross profit dollars are growing 5% to 6% to 7% and the expenses are growing 4% to 5%, then we'll be fine. Now how do you do that? Clearly, we need to continue to work really close with our customers and understand that the value package has worked in both ways in terms of the service and the pricing. And then internally, we saw pressure on productivity, in operations, in particular, in the transportation side, even x fuel and, to some extent, in selling. So selling, potentially some of that has continued to invest in the sales force. But there's opportunities for us just to manage the business a little bit better here, I think, on the cost side and get our productivity improvement to go along with the cost improvement. So I don't want to sound too cliché-ish here, but there are some blocking and tackling fundamentals here that we need to improve somewhat here over the second half of the year. As far as the pricing, we are, in different ways, and have been for the last year or 2, working with some different forms of what, I guess, would be characterized as scientific pricing. We have -- as we have moved into this stage of the business transformation work, we have looked at opportunities to decouple some of the things that were essentially integrated into the software, whether it be CRM -- we've talked a little bit about inside sales. Pricing would be another one. I'm not going to tell you today that there's anything imminent there, but that's certainly -- I would put that more into the long-term strategic initiative bucket that I talked about, along with strengthening some of our supplier relationships, a more fundamental look at our cost structure overall, as well as obviously what I did speak to, which was business transformation. I also think you'll see us continue to improve our understanding of our customers and customer engagement. We hired a gentleman here this quarter, Bill Goetz, who's going to start up our marketing department with a lot of focus initially on the customer side of things. So there's several things we're working on there for the medium term, and we'll be able to explore those a little bit more with you here later in the year.

And as a follow-up to that, to what degree are you still doing reviews with your customers? And is that -- are you still getting a top line benefit like -- it probably is not what you were getting, but some kind of benefit from that process?

We definitely are. I’d say that's an area where we're very pleased. We continue to do them. I think we're doing them better in terms of the planning, the targeting of the actual review itself. A lot of these people have been through this now several times so you need to raise the quality of the review each time, as well as the follow-up. So we definitely get better retention, which is the main goal here, and ultimately penetration with the folks that we do review. And those tend to be our larger accounts and/or accounts with high potential. So that's definitely a positive for us right now.

All right. Then one final thing. First wave, remind us, that's going to be how many operating companies per week or per month?

Per week?

Again, well, I guess it's per month, right?

It's per cycle. I'll let Chris kind of jump in there, John.

We haven't actually talked about how many, and to be honest, John, that's something that we're still working through. But ultimately, we'd like to be able to get to more than a handful per wave. I would guess -- I would say that the first one is probably a bit smaller than that, but it's going to be enough to prove the next set of things we need to prove, which is, we can roll out multiple companies at the same time.

We'll go next to Greg Badishkanian, Citigroup.

Two quick questions. First is just when you talked about taking some share and being aggressive, how much of that is due to price versus maybe having your reps out there just maybe calling on customers more? And is there -- have there been any reactions in the marketplace from your competitors?

Okay, Greg, I'll start with that. So I think it's more of just an attitude or mentality. We -- if you go back and look at the numbers, as I'm sure you have, we have seen kind of a plateau-ing out in terms of real growth over the last 2 to 3 quarters at pretty low level. And we just -- we've mentioned here for the better part of a year or 2 that the pricing environment is pretty acute. And our whole business model is predicated on case growth and in terms of driving productivity, driving -- strengthening relationships with customers and that type of thing. So I think it's more of an internal mentality across our geography that we were just going to get more aggressive. And when people are coming after our business in aggressive ways, we, I think, have fought back a little bit harder than maybe in the past and maybe in ways that we don't really like in the short term. But the bottom line right now for us is I would have liked to have seen a better bottom line this quarter, but it's better for us to get the cases and, over time, work on improving our productivity than to continue to accept the kind of real growth that we were looking at in a market that's -- it looks like it's growing a little bit right now, but it's still going to be, we think, somewhat uneven. So we're just trying to be more aggressive out there in a smart way. There are certainly things that we need to improve upon, but we just felt that we needed to kind of take it to the market a little bit here.

Right. Is that more in the street or more on kind of multichain or multiunit chains?

It plays out different. I mean, in the street, you have 8,000 sales people. And on the big CMU accounts, you tend to be working one-off with the larger customers. But I would say it's both. I mean, what I'm really trying to say here is, we're trying to be highly responsive to our customers. This inflation environment doesn't appear to be going away anytime soon. That's very difficult for the customers. From the data that we see, it would appear that the inflation at the operator level that they're absorbing or passing along to their customers is 2% to 3%. You see our numbers around 6%. So that's something that we have to work through with the customer level. But to answer your question, it's on both fronts.

And what do see your customers as doing to absorb some of the higher costs that they have besides trying to push back on you? Are they menu or are they -- what are they doing to be more creative?

Well, I think all the things that they've been doing, I mean, certainly, the menu analysis and trying to work with us and work within their own shops in terms of how to make the menu more attractive, more profitable. They're trying to find ways to -- there's a lot of different vehicles out there to increase traffic in their restaurant, manage their labor staff more effectively, all the things that you would expect a good business person to do in that type of operation.

We'll go next to Meredith Adler, Barclays Capital.

I guess I'd like to just continue a little bit on this theme. I have heard that maybe some of the very largest of your competitors were not feeling quite as much pressure as you are. Do you have any sense if that's true? And do you have any sense about your positioning that might make things a bit more competitive for you right now?

Meredith, what was the second part of the question?

If it's true, what is it about your business, the way you're positioned that may make you have to be more competitive right now?

Well, I don't know that it is true. It's hard for me to comment on what we may have heard from other sources, given that they're all private sources. So I can't really comment on how they're doing. I can tell you that this market, if it's growing at all, it's growing very little, and we just put up 2.8% to 3.6% growth, depending on how you look at acquisitions. So like I said, I mean, this quarter, we're not pleased with the bottom line, but we feel we're doing what's right for Sysco and our customers and our shareholders. And we're in this thing for the long term, so we've got a lot of different competitors out there with different time horizons, and I really don't know what they're feeling or seeing.

Okay. And on some of the smaller competitors, we thought they would get hurt during '09 because business was really weak, but we had deflation so it probably benefited on the working capital side. Do you think that they're under more pressure now because working capital is going up significantly? And are they having trouble getting financing?

Meredith, this is Chris. I'll try to take that one. Again, it’s hard to make generalizations across the pool of some multiple thousands of smaller competitors. But as sales go back up, re-inflates as we like to say, if they want to participate in that growth, if they want to sell more boxes, they're going to have to find the financing for the working capital somewhere. I don't know if they have access to that capital or not, to be honest with you. They may not be participating in the growth. I mean, one thing you kind of have to look at, if Technomic is saying that the market grew last year, I think, basically 0.1% or flat, and we know we grew our cases and you're at least implying that others may have grown their cases, some of the big guys that kind of lead you to believe that somebody out there is shrinking, we just don't have visibility as to who it might be.

Okay. And I guess I'm just trying to understand better. It is an extremely competitive environment. And do you have a sense where that competition particularly might be coming from? Or is it just very competitive in every market from lots of different competitors?

Yes, I think it's a continuation of the theme that Bill and I have talked about here for several quarters. You've got a very, very high inflation coupled with stagnant growth. And when you get those 2 things together, it is just highly competitive. Everybody is used to growing, wants to continue to grow, and they've got to fight out there on the street to find that growth when it's not coming organically.

And to compound that, Meredith, I know you know this, your customers are dealing with the same issues as are your suppliers. So that's what we mean when we talk about the pricing being acute and all that type of thing. It's acute at every level of the chain here.

Okay. And how long do you think it really takes to kind of get expenses and productivity in line with the gross profit dollar growth?

Like I alluded to, I think you'll see us improve there. I think it will be gradual. This quarter, a little cautious in this quarter. Just from a standpoint, we had a pretty good bounce back quarter last year in the third quarter, and it's just hard to predict, like I was saying earlier, because March drives us so much. But I think as the rest of the year plays out, you'll see improvement there.

We'll go next to Karen Short, BMO Capital.

I guess it sounds like maybe you were a little surprised by what it cost you to drive the improved volume or case volume growth. So I guess I'm wondering, would you say you reacted more to an acute pricing environment in the quarter? Or did you lead the more competitive environment?

We probably have reacted in some particular instances, Karen. And as I've mentioned earlier, I think internally, we just got a little bit more connected and coordinated on the fact that -- I don't know if you'd call it leading, but we're just -- we're not going to sit back in a flat environment and just hope that we get some case growth. You’re going to have margin pressure whether we grow 0% or whether we grow 2% or 3%. And the part that we know for sure in our model is that when we grow cases and there's a good balance of that growth between street and contract, over time, we'll be able to make money. And that may be not as much on the delta as what we've seen in the past, but it's certainly better for us than accepting flattish type growth. So I wouldn't say we were surprised. Frustrated might be a little better word in terms of that we weren't able to take more of it to the bottom line. But we're being very, I think, appropriately aggressive out there. And obviously, over time, the investment that we're making needs to turn off -- turn into some positive margin -- operating margin enhancement. And I think it will. I just think it's going to take a little longer than maybe what we've seen in the past.

Okay, that's helpful. And then any color on how much the timing of the holidays this year maybe helped your top line? I realized you'd probably give it back in the next quarter but...

I don't think I can quantify that, but certainly, the calendar played to our favor this time, and I think it was more that than anything. I mean, basically, what we saw in terms of the retail, we think we saw in our business. December was a better month for us, meaningfully better than what we saw certainly in October and the first part of November. So I don't know about the numbers, but I can tell you, it was much stronger the last 5 or 6 weeks.

Okay. And then just kind of looking forward, I don't know if you have any update on what you think the inflationary environment is going to be looking like. Obviously, there was a slight improvement this quarter.

Yes. It's really hard to predict and a lot of different views on that. I don't see any views out there that say it's going to subside significantly the next 3 to 6 months. Hopefully, it will come back a little bit, but you've seen it go from, what, 4% to 5% to 7% back to 6%. So a lot of commodity pressure, a lot of pressure in the meat area. I'll let Chris speak to some of the other categories in terms of what it means to our business. But we're not really looking for a whole lot of relief here over the next couple of quarters.

No, that's right. I mean, I keep saying we may have a crystal ball, but we don't know how to read it. It's -- it eased off. I'd like to say it was easing off throughout the quarter. That would not be factually correct though. It didn't ease off throughout the quarter. So it's hard to say where it's going to go. And then I think one of the things we've talked about in the past, not so much recently, is it used to be just a few categories. Now it's pretty broad-based. It continues to be fairly broad-based. Bill mentioned meat. That's been a category that's been under inflationary pressure for a while. And if you just look at supply and demand, it looks like it's going to continue to be under pressure for a while. Other categories may have the opportunity to ease off faster. Should we get some help in the commodities market, we'll just have to look at that. My best guess is we'll get back to a place where we have some categories that are highly inflationary and others that are more normal. And so the overall rate may be high, but it will only be across certain categories. That would certainly be better than the situation we're in today. But, again, that's crystal ball type stuff, and I can't tell you how long it takes to get there or even if we're going to get there.

Okay, great. And then just last question. Any initial comments on how the second opco is doing on the new system?

Yes. I thought we made some comments on that. I'll try again here, Karen. Look, we just went live there last weekend. So we're into early part of week 2, and it went well. I mean, it went well from an operational standpoint, and some of those things I alluded to in my comments in terms of where we had some struggles. Certainly, on the order entry and on the reports, we're off to a much better start there. And like I said, we saw those improvements already in Arkansas back in November. Now as you can appreciate in the cycle of our business, it takes 2, 3, 4 weeks to go through an inventory turn and all that type of thing to get a full handle on how some of the demand planning and the ordering and reordering systems and all of that will work. And so we'll be watching that real close here over the next 2 to 4 weeks.

We'll go next to Ajay Jain, Cantor Fitzgerald. Ajay Jain - Cantor Fitzgerald & Co., Research Division: I'm trying to reconcile the sequential improvement in volumes with your gross margin performance. So just based on the magnitude of the volume growth in the quarter, can you comment on whether there was any greater emphasis on price investments that might explain some of the variability in the top line and your gross margin performance?

Ajay, it's a great question. I understand it from your perspective. It's just not exactly how we run the business here or how we’d think about it. What I'm trying to articulate to you is, we did -- we had our presidents in for our regular fall council here in the middle of November, and we talk a lot about the business. And I think coming out of that meeting, we probably did take a little bit more of a cohesive approach to being more aggressive in terms of protecting our business, supporting the customer base and going after new business opportunities. So it wasn't like, okay, we're going to invest x in price to get to that, but we saw some pressure on margins as we did that. But to be honest with you, I can't tell you if the margin pressure really exacerbated that much the second half of the quarter. So I think my point is the pricing pressure is there. We're going to go out and get cases while it's there and learn how to manage it as best we can. And at the same time, there's a learning here that's been with us for some time. And certainly, our strategy, which I feel very good about, is addressing it, which is in the world that we're in and that we're going to be in for the foreseeable future, we need to continue to work on our cost structure. And it goes well beyond cutting and slashing. I mean, it's just a fundamental, a more cohesive approach to productivity opportunities in all parts of the business: operations, selling and admin. And you see us, over the medium term, beginning to address some of that with the business transformation work. In the shorter term, when you have 70 Broadline operating companies and 8,000 sales people on the street and 47,000 employees, there's always opportunities to improve productivity in a business. And those are the things that we're working on today. And clearly, there's opportunities for us to assess where we are in our pricing and tweak that as well. Ajay Jain - Cantor Fitzgerald & Co., Research Division: Okay. And I think you confirmed, just based on the general operating environment and the read-through for your case volume trends, it looked like you did see some pickup in number [ph] and you're seeing some similar improvement in volume trends in the current quarter. It doesn't sound like things have tapered off -- correct me if I'm wrong -- things have tapered off over the last month or so. But can we infer from that, that your volumes or case volumes are still in the 2% to 3% range through the first 4 weeks of the quarter?

I think what I said, Ajay, was that the trends that we saw in the latter part last quarter are continuing. I just want to be a little cautious here is that you've followed us for a long time. January, even February, are not that relevant in terms of this quarter. The month of March is kind of the month where you have the -- you still have the seasonal business in the South, but people start getting out again in the North. So yes, so far, we've seen continuation in the trends, but March is going to drive this quarter. And as I mentioned in my prepared comments, I think that the real key for us in the second half of the year is improving in the areas that have been questioned on and that we've addressed this morning. But we need to see a continuation of those trends. And if we do, I think we're well positioned. Ajay Jain - Cantor Fitzgerald & Co., Research Division: And if I could, I also wanted to ask a question about the facility in Indiana. I know that the timing has gotten pushed out a few different times over the last few years, and each time, it seems like the main reason cited for the delay is just the lack of industry growth. So I just wanted to confirm if the business decision to build out the third RDC is purely a timing issue from your standpoint. Or is there any kind of a scenario where you might feel that the capital investment just simply isn't warranted?

Well, I mean, Ajay, as you might imagine, those are all coupled together. When we build facilities, we expect to get a return. And when we first looked at that facility, just like the other 2, a lot of the return came from what we call the avoidance of capital, which is, as cases grow, we won't have to build out facilities around that new facility because that facility will take up much of the volume. So it helped with the return. So when you get into a low case environment, you're not seeing the same return on the facility. So we said, you know what, we need to push this thing off a little while and keep looking at it. We continue to look at it. Case growth here is certainly helping the case for that facility, but it's also causing us to be a lot smarter about what other benefits can we derive from that facility, how can we work with suppliers better in terms of inbound transportation, et cetera, to get more return out of that facility if we don't think we're going to get the return the same way as we did in number 1 and number 2. So it's really all of the above. It's certainly not something we've taken off the table. We just continue to evaluate it. And we said we'd look at it again in the spring, and that's our plan. Ajay Jain - Cantor Fitzgerald & Co., Research Division: Okay. And one final question, if I could. Just based on your update for the ERP guidance of, I think, the new range is $2.30 to $2.50, how much of that is, if you can comment, Chris, is depreciation?

I can't really comment specifically on the depreciation number. What we have said is that if everything continues to go well with Oklahoma as we read the assessment, if we're prepared to roll out the first multiple wave, we would expect our depreciation to start somewhere in the latter part of the third quarter. And that is factored into the updated expense guidance that we've given you. We've not broken out how much it is at this point.

We'll go next to Ed Kelly, Crédit Suisse. Edward J. Kelly - Crédit Suisse AG, Research Division: I'm just trying to get a sense for what real underlying market growth is doing here and what the cadence is for Q2 versus Q1. If you had not been, call it, a bit more aggressive in terms of growing volume, would your case volume growth have been similar to Q1? Would it have been slightly better? How should we be thinking about that?

Yes, it's another one of those really good questions. It's hard to tell. I think what you should be thinking is, for the calendar year, the early estimate is that the market was flat. I think we said up 0.1%. I think at the same time, it was probably better than that in the December quarter for the reasons that we alluded to and certainly what you've seen in other businesses. So I think you probably would have seen better growth in the second quarter -- our second quarter than the first, even if we hadn't maybe gotten a little bit more aggressive in terms of our approach and mindset, but I don't think you would have seen what we put up. So that's the best I can conjecture on that, Ed. Edward J. Kelly - Crédit Suisse AG, Research Division: Okay. And I'm trying to see if I'm reading you guys correctly here, but you sounded a little frustrated about the flow-through on the bottom line of the volume growth. But it doesn't sound to me like you really plan on changing how you go after volumes. So if you're going to improve that flow-through, was it really all about the operating expense line and how you get that done?

Yes. Look, I used the word frustrated. Maybe, I don't know, depending on the day, that could be a little strong or it may not be. But the bigger point here, I think, from our standpoint is, when you look at our business model, it's predicated on growth, whether you're talking about building RDCs, whether you're talking about growing the earnings and that type of thing. And we know when we grow boxes that over some period of time, generally, we can leverage that into earnings growth. And that's what the goal is. So, yes, we acknowledge here that the number on the bottom line didn't come in where we expected it to for the quarter. So that's disappointing on one level, but I'm not disappointed in the sales. I mean, we feel good about how we're going after the business. I feel very good about our people and the effort that we're seeing there. I feel very good about the cash flow of the company. I mean, we put in this IRS thing -- after this year, that's behind us. I think you'll see our working capital management improve somewhat over time. And I feel good about the strategy. So overall, I feel good. The frustration is -- look, we're competitive people. We know that we have shareholders that are looking for certain numbers, and we just came in a little bit short of what we expected to come in at. But I'm not frustrated in terms of the business or the people. Edward J. Kelly - Crédit Suisse AG, Research Division: Okay. And then related to the business transformation costs, I know you're obviously not prepared to give numbers beyond what you've given this year. But do you think that the peak year in spending on business transformation costs will be fiscal '13? Or will it be the current year?

When we had originally put up numbers for -- I'm going to try to answer your question not by looking forward but by reminding you of what we said before. When we first put up numbers, we showed the peak year being, I think, either fiscal '12 or fiscal '13. Since then, we’ve talked about the delay that we've experienced. And so I think you can make a reasonable assumption that the peak year got pushed out. So my best guess, and I don't have numbers to share with you yet, but we do believe we'll have quite a bit to talk about in May. My best guess is peak year is going to be fiscal '13. Edward J. Kelly - Crédit Suisse AG, Research Division: And just last question for you. Can you help us with how much you've capitalized to date? And then as you think about that line item beginning to amortize, over what time period should we be doing that on average?

Yes. So we're going to issue our Q tomorrow, and I think you'll be able to -- with that number and previous numbers, you'll be able to come up with the total capitalized number. I don't have it in front of me or off the top of my head, Ed, but you'll be able to see what it is. And then in terms of the timeframe, some of the stuff that we're capitalizing is at 7 years, some is at 5, some is at 3. Ball-parking it, not knowing the number off the top of my head, you can probably take an average around 5 years, and you will be -- plus or minus a year, you're going to be accurate.

We'll proceed next to Andrew Wolf, BB&T Capital Markets. Andrew P. Wolf - BB&T Capital Markets, Research Division: Bill, I know it's -- I don't blame you for being a little cautious on sales. But given the macro backdrop got a little better and your sort of -- your internal numbers got a little better in sync, and I know you're going out and getting share, too. But you also characterized, I guess, your outlook is -- you still think the market is going to be choppy. What would -- what might make you turn to a little more -- saying something like cautiously optimistic? Would it be a good March or -- for Sysco and the market? Or are you just -- that's your outlook? You just think it's going to be choppy? And if that's the case, could you explain why?

I let Chris use the word choppy this time. I didn't say choppy. So I'm trying to be optimistic here, Andy. So, yes, I think a couple of good quarters in a row would be all I need, to be honest with you. And so I think we had a nice finish to the last quarter. How much of that was driven by holidays is to be determined. I just think, if you take a step back and just look at the economy in general and the mindset of the consumer, every piece of data that you're seeing right now on the consumer side is increasingly positive. So if that can continue and if that translates into people going out to eat a little bit more, as I said in my prepared remarks, then that's a good thing. So it's just -- it would be nice to see a trend over 2 or 3 quarters where you see that. And then I think that -- then that would really validate the approach that we've taken, which is to get more aggressive in the marketplace and to be well positioned when the volume picks up, then we can leverage a lot of our scale at that point in time. So I feel like we're doing the right things. It would be nice if we saw the results a little faster. We haven't. I think we will see them gradually. And, yes, I think cautiously optimistic is where we're at, but all that really means is, we need to see a couple -- maybe 3 good quarters together. And it really comes down to what's between the years of the consumer and are they to a point now where they're going to start going out to eat a little bit more. We're seeing a little bit of that, more at the quick service side. But what we've consistently seen over the last few months is that the tickets, the size of the purchases when people go out to eat, that is increasing. So we're seeing signs, and we just need to see them, I think, for a little bit longer.

Andy, I'll jump in since I'm the one that used the word choppy. The economist in me just continues to remind myself that we're comparing these latest quarters to a historically bad point in time. And by any measure, the economic -- the macroeconomic [indiscernible] still say that this economy is very fragile. So while we're -- Bill's words, I'll echo, while we're feeling a little bit better, you do have to sometimes pull back and remind ourselves that this economy overall is still very fragile. If we get some rhythm to it, the consumer confidence picks up, the jobs data is certainly helping here, that stuff starts to build momentum, you'll hear us starting to be a lot more confident about it. But we're not very far from the trough that we were in.

I mean, the one thing -- I know you know this, Andy. But, I mean, the one thing we have to remind ourselves and we've been in this period here for an extended time now is going out to eat is still a relatively low-cost form of entertainment, and I've been saying that off and on for 25 years here at Sysco. And we certainly have had to deal with a new environment the last 3 years, but once that mindset turns, we think that, that will be helpful to our business. We just haven't really seen it turn in the business as much as we'd like to see yet. Andrew P. Wolf - BB&T Capital Markets, Research Division: Good. That helped me. A couple of housekeeping questions. Did you have a similar bonus increase accrual in Q1 that you called out this quarter?

Yes, it's a little bit of a mismatch. Last year, in the second quarter, based upon our full year forecast and the bonus plan and targets we had in place at that time, we reversed the bonuses basically back to 0. That's just what the forecast was telling us. We were not going to hit the grid. We had a good third quarter, as Bill alluded to earlier though, and that put us back in contention. This year is a slightly different bonus plan. There are different targets and objectives because you change those year by year, depending on your plan. And we did not reverse -- we do not take our bonus accrual down as low as last year, hence you have a lapping effect of $18 million. Andrew P. Wolf - BB&T Capital Markets, Research Division: And lastly, actually do have a follow-up on gross margin, which I thought was exhausted. But -- and you might have mentioned this, but was there a mix aspect to it, too? Are you growing a chain type or non-street type of business that might be lower margin at a greater rate? And is that just part of what is going on with the gross margin? Or was it mostly on the price side?

No, we really -- I mean, we've done the same analysis on gross margin that we've done every quarter to try to ferret out is it mixed, is it this, is it that, and really nothing. The thing that stands out most is the category we've been calling inflation, which is just in the high inflationary product categories. That's where we're seeing the most margin. That accounts for the vast majority of the 75 basis points.

Yes, I think the only other thing I would add to that is, as you read our material and as we speak here today, we're talking a lot more in terms of deltas on dollars, piece growth, sales dollars, in particular, gross profit dollars, expense dollars, that type of thing. Look, we have concerns about the margin as you can expect. But the percentages are not as relevant. When you've been through a period -- extended period here now of several quarters of inflation, whether you're looking at expense percentages or gross profit percentages, I don't know that, that's as meaningful a way of looking at it as it might have been historically. But clearly, what is meaningful is the dollars that we're taking to the bottom line. So that's how we're evolving here in terms of how we look at the business internally, which is our gross profit dollar growth versus our expense growth.

And we'll have our last question today from Shaurja Ray, JPMorgan. John W. Ivankoe - JP Morgan Chase & Co, Research Division: I'm on for John -- I'm John Ivankoe. Just a quick housekeeping one first. Did you quantify how much the weather and the calendar shifts were to the sales growth for the quarter?

No, we did not. John W. Ivankoe - JP Morgan Chase & Co, Research Division: Could you? Or is that...

I don't think it was a big deal, to be honest with you.

I wouldn't try to be short with you. We didn't quantify them because, frankly, they weren't a big deal. They weren't enough to call out.

We had some bad weather last year, I think, in the North, but we don't -- I don't really count that because bad weather in the North in December is not a big deal.

Yes. It's kind of something you expect year-after-year and you never know what day it's going to hit.

I think the one thing that did help, but we didn't quantify it, was the way the calendar fell with Christmas and New Year's Day being on a Sunday. That did, I think, allow people to get out more. But I think we benefited more and our industry benefited more from just what you saw in retail and everything else, which is business just seemed to pick up throughout the holiday season. But even with that, I feel like we were able to grow our business better than others. John W. Ivankoe - JP Morgan Chase & Co, Research Division: Okay. And then just in terms of, I think, longer term, you've talked to maybe 0.5 point or 1 point of sales growth coming from acquisitions. Could you just talk a little bit about how you guys see the acquisition pipeline going forward, if you still have kind of confidence in your ability to roll in maybe some smaller companies?

Yes, I mean, that continues to be our goal and our plan, 0.5 point to 1 point. We've got a very robust pipeline. We're trying, as we've said in prior calls, to go back to kind of the way we used to do things in the past, which is just build relationships with the families that are out there. And when it comes time for them to exit the business for whatever reason, we're a phone call away, and hopefully we can put together a transaction. So we have a pipeline of folks that are thinking about exiting the business either now or sometime in the near future, and we try to turn that pipeline into actual transactions. We've done a number of deals this year. They’re usually pretty small. We don't announce every one of them because of their size. But in aggregate, we hope they add up to 0.5% to 1% every year.

That concludes today's Sysco Corp. Conference Call. Thank you all for your participation.