January 29, 2008

Tyson's quarter profit plunge 40 percent on beef losses, grain price hikes

Tyson Foods announced that its first-quarter profit plunged 40 percent as the loss on beef widened and feed costs surged.

The company withdrew its earnings forecast, citing rising grain costs.

Net income in the three months ended December 29 fell to US$34 million, or 10 cents a share, from US$57 million, or 16 cents, a year earlier. Sales rose 3.2 percent to US$6.77 billion.

The loss on beef widened to US$85 million from US$23 million as the cost of buying cattle increased and the industry had excess slaughtering capacity.

Last week, the company said it will halt slaughtering cattle at a plant in Kansas and cut 1,500 jobs.

Tyson fell 23 cents, or 1.7 percent, to US$13.26 on January 25 in New York Stock Exchange composite trading. The shares fell 16 percent in the past three months.