Shares of Tyson Foods Inc. of Springdale traded down by more than 5% on Wednesday after the meat processor cut its outlook for the fiscal year.
In a news release, the company cited factors including commodity market volatility, implementation of enhanced food safety initiatives, a beef processing plant fire at a plant in Kansas, and slower than expected operational improvements in its chicken segment. Tyson and other companies are also facing higher costs for animal feed.
Tyson Foods (NYSE: TSN) now expects fiscal 2019 adjusted earnings between $5.30 to $5.70 per share.
"The discrete challenges we've encountered this quarter now lead us to believe we will fall short of our previously stated guidance, but our outlook for fiscal 2020 remains positive as we believe some of the challenges we're experiencing are not expected to repeat, and we're expecting more favorable market conditions as well," President and CEO Noel White. "Our portfolio is structurally sound and generating strong sales volumes."
Tyson's challenges include rebuilding its beef plant in Holcomb, Kansas, after a fire early last month. The plant employs about 3,800 people. It processed about 6,000 cattle per day — about 5% of total U.S. slaughter, according to Reuters.