Tyson Reports Second Quarter and Six Months Fiscal 2012 Results
The Springdale, Ark., company has benefited from price increases and strong demand abroad for pork and beef as it faces challenges from high ingredient costs. Last year’s export increase helped drive U.S. beef and pork prices to record highs, but the beef industry was hurt in the latest quarter by concerns over safety, including a controversy over an additive that has been dubbed pink slime by some critics.
Tyson President and Chief Executive Donnie Smith said the company’s chicken, pork and prepared-foods segments all were in or above their normalized operating-margin ranges, while beef essentially broke even despite challenging market conditions.
Tyson anticipates gaining momentum in its fiscal third and fourth quarters—with the potential to achieve its prior guidance for per-share earnings of $2 for the year, Mr. Smith said.
For the quarter ended March 31, Tyson on Monday reported a profit of $166 million, or 44 cents a share, up from $159 million, or 42 cents, a year earlier.
Revenue increased 3.4% to 8.3 billion.
Analysts polled by Thomson Reuters expected earnings of 39 cents on revenue of $8.49 billion.
Operating margin fell to 3.7% from 3.8%.
The beef segment—the largest revenue contributor—posted a loss of $1 million as volume slid 11%. Revenue was up 1.1% because of higher prices.
The chicken business’s profit rose as sales improved 6.3%.
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