In a press release dated May 8th Tyson Foods Inc. (TSN) announced results for the first quarter of FY 2023 ending April 1st 2023. TSN posted lower revenue against an estimate of $13,600 million and missed on earnings with a consensus GAAP EPS of $0.79.
The following table summarizes the results for the period compared with the values for the corresponding quarter of the previous fiscal year (Values expressed as US$ x 1,000 except EPS)
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First Quarter Ending
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April 1st 2023
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April 2nd 2022
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Difference (%)
|
|
Sales:
|
$13,133,000
|
$13,117,000
|
+0.1
|
|
Gross profit:
|
$527,000
|
$1,735,000
|
-69.6
|
|
Operating income (loss):
|
$(49,000)
|
$1,156,000
|
-95.8
|
|
Pre-tax income (loss)
Net income (loss)
|
$(130,000)
$(91,000)
|
$1,087,000
$829,000
|
-112.0
-110.0
|
|
Diluted earnings (loss) per share:
|
$(0.28)
|
$2.28
|
-112.3
|
|
Gross Margin (%)
|
4.0
|
13.2
|
-69.6
|
|
Operating Margin (%)
|
-0.3
|
8.8
|
-103.4
|
|
Profit Margin (%)
|
-0.7
|
6.3
|
-111.1
|
|
Long-term Debt and other liabilities:
|
$9,454,000
|
$9,239,000
|
+2.3
|
|
12 Months Trailing:
|
|
|
|
|
Return on Assets (%)
|
5.8
|
|
|
|
Return on Equity (%)
|
12.8
|
|
|
|
Operating Margin (%)
|
6.4
|
|
|
|
Profit Margin (%)
|
4.5
|
|
|
|
Total Assets: April 1st ‘23/Oct. 1st 2022
|
$36,796,000
|
$36,821,000
|
-0.1
|
|
Intraday Market Capitalization February 6th
|
$22,077,000
|
|
|
52-Week Range in Share Price of TSN: $52.13 to $94.77. 50-day Moving average, $59.99
Market Close: Friday May 5th $60.61. Monday April 8th post release, 10H30 $52.70 down 13.2 percent.
Forward P/E 14.0 Beta 0.7
The Chicken Segment attained sales of $4,430 million ($4,086 million in Q2 FY 2022) representing 33.7 percent of Company revenue. Operating loss was $(258) million In Q2 of 2022 operating income was $195 million representing 17.1 percent of the Company total. For the Chicken Segment the report stated:- “The USDA projects chicken production will increase approximately 3% in fiscal 2023 as compared to fiscal 2022”.
For comparison among Tyson Foods’ business segments the adjusted operating income (loss) in Q2 2023 were respectively:- Pork, ($33) million; Beef, break-even; Prepared Foods $241 million and International $1 million.
In commenting on results Donnie King, president and CEO stated “While the current protein market is challenging, we have a strong growth strategy in place and are bullish on our long-term outlook,” said Donnie King, president and CEO of Tyson Foods. “We saw strong performance in our branded foods business and continue to be laser-focused on meeting customer needs and planning the future with them.” He added “Through our growth strategy, focus on
margin improvement, and proven leadership team, I am confident in our ability to capture the opportunities in front of us and create long-term value for customers, team members, and shareholders.” These comments stand in contrast to the more optimistic sentiments expressed in the First Quarter report and performance during the most recent quarter.
Guidance for FY 2023 included Revenue between $53 and $54 billion; Adjusted operating margin for the Company was not provided for FY 2023 but a value of -1.0 to 1.0 percent was projected for the Chicken Segment ; Capital expenditure of $2.3 billion. Tyson projects improved results from international operations and $1,000 million in savings from the “Productivity Program” comprising consolidation of the Corporate Office, downsizing of administration and other economies by the end of 2024.