Tyson Foods Inc. of Springdale on Monday reported a 40 percent increase in first-quarter net income and raised its guidance for fiscal-year earnings.
The publicly traded meat processor (NYSE: TSN) said in a news release that lower feed costs and higher demand in chicken business contributed to profitability and helped drive the company to record results for the first half of the fiscal year.
Tyson Foods raised its fiscal 2016 earnings guidance to a range of $4.20 and $4.30 per share, up from $3.85 to $3.95, and predicted sales of $37 billion, down from 2015 on declines in beef, pork and chicken prices.
“We’re in a great position, and we’re generating momentum that will take us into 2017 and beyond,” President and CEO Donnie Smith said in a news release. “We’ve produced record results in the first half of the fiscal year, and we expect continued strong performance in the second half.”
Overall, the company reported first-quarter net income of $434 million, up from $310 million in the same quarter last year. Revenue was $9.2 billion, down from $10 billion in the same quarter last year.
The company cited record second-quarter operating income of $704 million, up 27 percent to adjusted results from the same quarter last year and record second-quarter operating margin of 7.7 percent. It also reported record operating margins in its chicken, pork and prepared foods businesses.
Tyson Foods reported quarterly chicken sales of $2.7 billion, down from $2.8 billion in the same quarter last year. The company noted sales volume up 1.7 percent during the quarter amid a spike a demand. Feed costs dropped $80 million, leading to an increase in operating income for the business.
Beef sales were $3.6 billion, down from $4.1 billion last year. Sales volume rose 2.8 percent amid higher fed cattle supplies, but average sales prices declined.
Pork sales were $1.2 billion, flat from last year. Sales volume rose 3.1 percent, excluding the impact of its Heinold Hog Markets business last year, a condition of its purchase of Hillshire Brands.
Prepared foods sales were $1.8 billion, down from $1.9 billion last year. Sales volume was flat.
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