Tyson Blames This Slime for Revenue Miss
Meat processing company Tyson Foods Inc. (NYSE:TSN) reported second-quarter earnings that beat estimates while revenues missed due to weak beef sales.
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The company on Monday reported net income of $166 million (44 cents a share) for the January through March quarter, compared to $159 million (42 cents a share) in the year-ago period. Analysts had projected earnings of 39 cents a share.
Sales climbed to $8.27 billion, compared to $8 billion a year earlier and the $8.49 billion projected by analysts, though volumes fell 4.3 percent due to a 10.7 percent decline in beef volumes. Higher pries helped compensate for weak beef sales, helping profitability. Beef sales were hit by unflattering media publicity regarding “pink slime,” a ground beef filler, and later by a report of a case of mad cow disease, the first in the U.S. in six years.
On the outlook for the full year, Tyson CEO Donnie Smith said in a statement on Monday: “We still think we have the potential for earnings per share of $2 for the year if we execute as planned.”
Sales are expected to gain fresh traction in the third and fourth quarters.
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