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·         Tyson Foods tops profit estimates as low-cost feed provides boost

·         Strong Fourth Quarter Propels Tyson Foods to Record Year

 

 

Tyson Foods tops profit estimates as low-cost feed provides boost

 

Reporting by Uday Sampath in Bengaluru; Editing by Sai Sachin Ravikumar, Reuters

November 13, 2017

 

(Reuters) - U.S. meat processor Tyson Foods Inc’s (TSN.N) quarterly earnings and revenue topped analysts’ forecasts, as its chicken and beef businesses benefited from strong demand as well as lower costs to buy animal feed.

 

Shares of Tyson, the maker of Ball Park hot dogs, rose nearly 4 percent to $77 in premarket trading on Monday.

 

Low-cost feed and strong demand from consumers for protein such as beef and chicken have in recent quarters bolstered profits for meat processors and producers such as Tyson.

 

Feed could remain cheap as this year’s corn and soybean harvests are likely to be at or near record levels, according to figures the U.S. Department of Agriculture released last week.

 

Sales in Tyson’s beef business, its largest, rose 9.5 percent in the fourth quarter ended Sept. 30, while operating income more than doubled...

 

more

http://www.reuters.com/article/us-oil-emirates-adipec-decision/opec-allies-unlikely-to-delay-decision-on-oil-cut-extension-idUSKBN1DD123

 

 

Strong Fourth Quarter Propels Tyson Foods to Record Year

Guides to Continued EPS Growth in Fiscal 2018

 

Source: Tyson Foods, Inc.

via Nasdaq/GlobeNewswire - November 13, 2017

 

SPRINGDALE, Ark., Nov. 13, 2017 (GLOBE NEWSWIRE) -- Tyson Foods, Inc. (NYSE:TSN), one of the world’s largest food companies and a recognized leader in protein with leading brands including Tyson®, Jimmy Dean®, Hillshire Farm®, Ball Park®, Wright®, Aidells®, ibp® and State Fair®, today reported the following results:

(in millions, except per share data)

Fourth Quarter

 

Twelve Months Ended

 

2017

 

2016

 

2017

 

2016

Sales

$

10,145

 

 

$

9,156

 

 

$

38,260

 

 

$

36,881

 

Operating Income

681

 

 

586

 

 

2,931

 

 

2,833

 

 

 

 

 

 

 

 

 

Net Income

395

 

 

392

 

 

1,778

 

 

1,772

 

Less: Net Income Attributable to Noncontrolling Interests

1

 

 

1

 

 

4

 

 

4

 

Net Income Attributable to Tyson

$

394

 

 

$

391

 

 

$

1,774

 

 

$

1,768

 

 

 

 

 

 

 

 

 

Net Income Per Share Attributable to Tyson

$

1.07

 

 

$

1.03

 

 

$

4.79

 

 

$

4.53

 

 

 

 

 

 

 

 

 

Adjusted¹ Operating Income

$

902

 

 

$

586

 

 

$

3,263

 

 

$

2,833

 

 

 

 

 

 

 

 

 

Adjusted¹ Net Income Per Share Attributable to Tyson

$

1.43

 

 

$

0.96

 

 

$

5.31

 

 

$

4.39

 

1 Adjusted operating income and adjusted net income per share attributable to Tyson, or Adjusted EPS, are non-GAAP financial measures and are explained and reconciled to a comparable GAAP measure at the end of this release. Adjusted net income per share attributable to Tyson guidance is provided on a non-GAAP basis because certain information necessary to calculate such measure on a GAAP basis is unavailable, dependent on future events outside of our control and cannot be predicted without unreasonable efforts by the Company. A further explanation of providing non-GAAP guidance is included at the end of this release.

 

Fiscal 2017 Highlights

 

    Record GAAP EPS of $4.79, up 6% from last year; Record Adjusted EPS of $5.31, up 21% from last year

    Record GAAP operating income of $2,931 million; Record Adjusted operating income of $3,263 million

    Total company GAAP operating margin at 7.7%; Record Adjusted operating margin at 8.5%

    Operating cash flow of $2.6 billion

 

Fourth Quarter Highlights

 

    GAAP EPS of $1.07, up 4% from last year; Adjusted EPS of $1.43, up 49% from last year

    GAAP operating income of $681 million; Adjusted operating income of $902 million

    Total company GAAP operating margin at 6.7%; Adjusted operating margin at 8.9%

    Reduced debt over $600 million

 

Guidance

 

    Adjusted1 EPS guidance of $5.70-$5.85, representing an approximate 7-10% increase from fiscal 2017 Adjusted EPS

 

“The fourth quarter was a strong finish to another record year,” Tom Hayes, Tyson Foods’ president and chief executive officer, said. “We delivered well over our goals of at least 4 percent operating income growth, EPS growth in the high single digits and 3 percent volume growth in value-added products, and expect to meet or exceed these goals again in fiscal 2018.

 

“Our Beef and Pork segments delivered outstanding returns for the quarter and for the year, again generating significant cash to fuel investments in our Chicken and Prepared Foods segments. For the 2017 fiscal year, our Core 9 product lines and our total retail business continued to outpace total food and beverage growth in both dollars and volume. At foodservice, our Focus 5 products are growing at six times the rate of the broadline distribution channel.

 

“Fiscal 2017 was a year of great change and, despite some challenges, our team remained focused on the long term by keeping consumer relevance, customer growth and shareholder value creation at the forefront. Not only did we generate exceptional financial results, we also strengthened the foundation needed to accelerate growth through several initiatives. We refined our strategy and put in place a new management team to implement it. With a renewed focus on protein packed brands, we initiated the divestiture of some non-protein businesses. We acquired and are successfully integrating AdvancePierre Foods to expand our manufacturing capabilities in sandwiches and other prepared foods and to increase our presence in the convenience store channel. We repurchased roughly $650 million in shares before the AdvancePierre acquisition and then redirected cash flow and proceeded to pay down more than $600 million of debt. We announced a restructuring and cost cutting program to increase our agility as an organization. To cap off a great year, the Board of Directors increased the dividend by $0.30 to $1.20 per share annually, an increase of 33%.

 

“Fiscal 2018 is off to a great start, and we’re currently expecting adjusted earnings growth of 7-10 percent to $5.70-5.85 per share. We’re confident in our ability to realize in excess of $200 million in net savings this fiscal year from our Financial Fitness program, including AdvancePierre synergies. We’re planning capital expenditures of $1.4 billion in fiscal 2018 while we continue reducing debt to reach our net debt to EBITDA target of around 2x, which we anticipate will happen by the third quarter. When we reach that target, we intend to resume repurchasing our shares.

 

“Our plan is to grow our business year after year through differentiated capabilities, deliver ongoing financial fitness through continuous improvement and sustain our company as we sustainably feed the world with the fastest growing portfolio of protein packed brands.”

 

SEGMENT RESULTS (in millions) ...

 

more, including financial tables

https://globenewswire.com/news-release/2017/11/13/1185054/0/en/Strong-Fourth-Quarter-Propels-Tyson-Foods-to-Record-Year.html