Tyson Foods Beats the Street in 2Q, Ups Full-Year Forecast

By Industrials FOXBusiness

Tyson Foods (TSN) reported flat fiscal second-quarter profits on Monday as the largest U.S. meatpacker successfully balanced rising costs with higher prices.

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The Springdale, Ark.-based meat and poultry company said it earned $159 million, or 42 cents a share, last quarter, matching its results from the year before. Analysts had been calling for EPS of 43 cents.

Sales climbed 16% to $8 billion, exceeding estimates for $7.54 billion. Hurt by higher grain costs, gross margins shrank to 6.7% from 8.2%.

“We produced record sales for the second quarter on substantially higher sales prices in addition to increased volume,” CEO Donnie Smith said in a statement.

Tyson said it increased its chicken revenue by 10% to $2.74 billion amid a 3.7% rise in prices and 6% growth of volume.

Looking ahead, Tyson said it expects fiscal 2011 sales to exceed $32 billion and earnings to be comparable with the year before.

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“We will continue to face challenging and volatile market conditions in fiscal 2011, but we maintain our belief that earnings should be comparable to 2010 due to our on-going operational improvements and focus on execution,” Smith said.

Shares of Tyson Foods, which have rallied almost 10% in 2011, were inactive in Monday’s premarkets.

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