Nov. 15 (Reuters) – Soaring meat prices have helped Tyson Foods Inc (TSN.N) overcome pandemic-related labor shortages at its factories, as the main U.S. meat packer has Monday announced a higher-than-expected quarterly profit and forecast an improvement in revenues in the coming year.
The Springdale, Arkansas-based company reported double-digit sales and profit increases in the fiscal fourth quarter ended Oct. 2, including a record quarter in its beef segment despite a 20% increase livestock prices.
Tyson shares were up about 4% by mid-morning.
Rising meat prices and improving restaurant demand have boosted U.S. meat companies, including Tyson, after the COVID-19 pandemic kept many diners at home last year. Meat packers also saw record demand for US beef from China and amid diplomatic tensions between Beijing and the Australian supplier. Read more
However, increasing costs for labor, transportation and items such as feed grains and packaging created headaches.
âInflation has clearly had an impact on the business,â said CEO Donnie King. âAs inflation rates continue, so will our pricing actions. “
Key aides to US President Joe Biden blamed Tyson and other big meat rivals who control much of the meat processing industry for rising food prices. Read more
Tyson rejected those claims and instead blamed the pandemic and the labor shortage in the United States for limiting production.
Sausage maker Jimmy Dean said he expected sales of $ 49 billion to $ 51 billion in fiscal 2022, against market estimates of $ 47.99 billion, according to Refinitiv IBES.
Sales reached $ 12.81 billion in the fourth quarter, from $ 11.46 billion a year earlier. Analysts on average expected revenue of $ 12.66 billion, according to Refinitiv IBES.
Net income attributable to Tyson rose to $ 1.36 billion, or $ 3.71 per share, from $ 654 million, or $ 1.79 per share, a year earlier.
Excluding special items, Tyson earned $ 2.30 per share, against estimates of $ 2.03.
Reporting by Karl Plume in Chicago and Praveen Paramasivam in Bengaluru; Editing by Ramakrishnan M., David Evans and Grant McCool
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