May 11, 2022
Tyson Foods raises its full-year sales outlook as US meat prices rise
Major US meat firm Tyson Foods has raised its full-year sales outlook as rising meat prices in the country pushed its quarterly revenue and earnings above projections, Reuters reported.
Tyson Foods said it has increased prices to offset soaring input costs such as labour and livestock feed.
Food prices have soared to a record high in March following Russia's invasion into Ukraine, which has disrupted grain shipments.
Donnie King, chief executive of Tyson Foods, said consumers are purchasing cheaper cuts of beef due to rising prices, but demand for meat is positive.
The company forecast annual sales of between US$52 billion to US$54 billion, which was higher than its earlier projections of between US$549 billion to US$51 billion. Data from Refinitiv IBES showed analysts expect the firm to announce annual sales of US$51.79 billion on average.
Tyson Foods also increased its projections for its beef unit profit margins to 13% from 11%.
US President Joe Biden's administration is concerned that that major Us meatpackers are dominant in the sector, and has announced steps to boost competition in the industry as the White House battles inflation.
Tyson stated in a regulatory filing that it got a subpoena from the New York attorney general's office on April 21 requesting information on meat pricing, sales, and production costs.
Tyson's beef prices increased by 23.8% year-on-year in the first quarter of this year. Chicken prices increased by 14.4%, while pork prices increased by 10.8%.
King said the firm's cattle costs are 23% higher and for grain, 20% up.
Tyson's poultry business's quarterly feed expense jumped by US$100 million from a year ago due to higher grain prices.
Quarterly revenue increased to US$13.12 billion, up from US$11.30 billion a year ago, topping the US$12.85 billion forecast. Adjusted profits per share were US$2.29, up from US$1.34 a year earlier and higher than the expected US$1.91.
- Reuters
