SPRINGDALE, ARK. — Income at Tyson Foods, Inc. dropped 43% during the second quarter on margin compression in the Beef segment and periods of supply and demand imbalance in the Pork segment.
For the quarter ended March 30, the company had income of $95 million, equal to 26c per share on the common stock, which compared with $166 million, or 44c per share, in the same period a year ago. Sales for the quarter were $8,419 million, up 2% from $8,268 million.
“Our second quarter typically is our most challenging, and this quarter was no exception,” said Donnie Smith, president and chief executive officer. “However, our business is structured to withstand adverse conditions, and we worked through the issues while positioning ourselves for what we believe will be a strong performance in the second half of the year.
“In our Chicken segment, we continued to emphasize operational efficiencies, upgrading our product mix and pricing to offset $165 million in additional feed costs for the quarter. Our Beef segment suffered margin compression as consumers opted for the relative value of chicken. Our Pork segment faced periods of supply and demand imbalance after the loss of some export markets while soft demand in food service impacted our Prepared Foods segment.
“Our e.p.s. for the quarter wasn’t at the level we’d like, but on an adjusted basis we’re about where we were at this point last year.”
The Chicken segment had operating income of $78 million, down 48% from $145 million during the same quarter of the previous year. The segment had sales of $3,094 million, up 6% from $2,911 million.
The Beef segment sustained a loss of $26 million, which compared with a loss of $1 million during the same quarter of the previous year. The segment had sales of $3,447, up 2% from $3,369 million.
Operating income within the Prepared Foods was $28 million, down 36% from $44 million during the same quarter of the previous year. The segment had sales of $803 million, down slightly from $807 million.
For the six months ended March 30, the company as a whole saw income decline 17% to $268 million, or 74c per share, which compared with $322 million, or 86c per share, during the same period of the previous year. Sales for the six months were $16,821 million, up 1% from $16,597 million.