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Tyson Foods Back in Profit

by 5m Editor
12 May 2010, at 10:24am

US - Tyson Foods reports sales for the second quarter of 2010 at $6.92 billion, up from $6.31 billion for the same period last year. This brings sales for the first half of the fiscal year to $13.55 billion from $12.83 billion last year. Net operating income for the year so far was $658 million compared to a loss of $169 million for the first half of 2009.

According to its latest report, all operating segments were profitable, with beef and pork above their historical normalised ranges. Chicken operating income was $114 million, or 4.6 per cent of sales, while the figures for beef were $126 million (4.6 per cent of sales) and for pork, $69 million, or 7.4 per cent of sales. For the prepared foods business, operating income was $37 million (5.0 per cent of sales).

Second quarter 2010 net earnings per share (EPS) was $0.42, as compared to $(0.32) last year. This included $24 million, or $0.04 per diluted share, related to losses on notes repurchased

Tyson says it is increasing the normalised ranges for the beef and pork segments to 2.5 to 4.5 per cent and 4.0 to 6.0 per cent, respectively.

The report adds that the Company repurchased/retired over $450 million of debt during the second quarter fiscal 2010, and it estimates its capital expenditures for fiscal year 2010 to be approximately $700 million.

The second quarter and six months fiscal 2010 results include $24 million, or $0.04 per diluted share, of pre-tax charges related to losses on notes repurchased during the second quarter fiscal 2010.

Donnie Smith, president and chief executive officer of Tyson Foods, commented: "We are very happy with these results, especially because our fiscal second quarter is typically not our best.

"Our beef and pork segments were the main drivers with very strong profitability. Prepared foods was within its normal range despite rising input costs. The chicken segment showed significant improvement, due in part to our continued focus on operational efficiencies.

"While we did predict tightening domestic availability of protein would lead to stronger fundamentals, it happened sooner than expected. And although the second quarter was a great quarter for us, we think we'll do even better the second half of the fiscal year as our operational performance continues to improve. We are very pleased with how our third quarter is going, and the summer grilling season is just getting started."

Further Reading

- You can view the full report by clicking here.