Tyson Foods Surpasses Q3 Expectations with Beef and Pork Gains, Chicken Segment Falls Short

Tyson Foods, Inc. TSN shares are volatile after reporting third-quarter results.

Quarterly adjusted earnings per share of 87 cents (+480%) beat the street view of 65 cents. Sales of $13.353 billion (+1.6%) beat the analyst consensus of $13.236 billion.

Beef volume rose 4.4%, the Pork segment rose 1.2%, while volume in the Chicken segment fell 0.4%.

“In Q3, we delivered the highest adjusted operating income in the last seven quarters while also generating strong free cash flow,” stated Donnie King, President & CEO of Tyson Foods.

Adjusted operating margin in the quarter under review expanded to 3.7% from 1.4% in the year-ago period.

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Tyson Foods exited the quarter with cash and equivalents worth $2.569 billion. The company’s inventories as of third-quarter-end totaled $5.033 billion.

Quarterly free cash flow (non-GAAP) was $1.089 billion, up $1.224 billion from the prior year.

Tyson Foods’ long-term debt stands at $9.701 billion as of June 29, 2024.

Outlook: Tyson Foods continues to expect sales to be relatively flat in fiscal 2024 as compared to fiscal 2023.

The company sees total liquidity, which was $4.8 billion as of June 29, 2024, to remain above the minimum liquidity target of $1.0 billion.

“We anticipate using existing liquidity to retire the $1.25 billion senior notes due August 2024,” Tyson Foods said.

For fiscal 2024, the United States Department of Agriculture (USDA) indicates domestic protein production (beef, pork, chicken and turkey) should increase slightly compared to fiscal 2023 levels, Tyson Foods said. 

For the Beef segment, the company currently sees an adjusted operating loss between ($400) million and ($300) million in fiscal 2024.

For the Pork segment, the firm anticipates an adjusted operating income of $100 million to $200 million in fiscal 2024.

For the chicken segment, the company anticipates an adjusted operating income of $850 million to $950 million for fiscal 2024.

For Prepared Foods, the firm anticipates adjusted operating income of $850 million to $950 million in fiscal 2024.

Price Action: TSN shares are trading lower by 2.01% to $60.00 premarket at last check Monday.

Photo via Shutterstock

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