Springdale, AR - Tyson Foods, Inc. announced operating results for the first quarter of fiscal year 1998 for the period ended December 27, 1997.
Earnings per share for the first quarter of fiscal 1998 were $.21 compared to $.20, up 5.0 percent from the same period last year. Gross profits increased 5.0 percent to $260.7 million from last year's $248.4 million and gross margin increased 80 basis points to 17.1 percent from last year's 16.3 percent.
Sales for the first quarter of fiscal 1998 were $1.52 billion compared to $1.53 billion last year, a decrease of 0.5 percent. The decrease in sales is mainly due to a 4.6% decrease in average sales prices mostly offset by a 4.3% increase in total volume. Included in general and administrative expense is a charge of $6 million for penalties and costs associated with the January 12, 1998 settlement with the Office of Independent Counsel in connection with the former Secretary of Agriculture Michael Espy investigation.
"We are encouraged by the continued improvements on the cost side of our business, particularly with the decline in feed prices," Tollett added. "There will continue to be challenges in the marketplace, at least through our second quarter, due to an abundant supply of all meat proteins. We also anticipate continued soft pricing in the international markets in the near term, but remain optimistic about the balance of fiscal 1998."
Tyson completed the merger with Hudson Foods on January 9, 1998, and is in the process of integrating the two companies. "The transition is progressing as expected; however, as with any acquisition, there are some areas that will need more attention than others. We expect the assimilation to command most of our attention for the remainder of the year. Our challenge and our goal is to manage this process in a manner that will allow us to quickly capitalize on the synergistic opportunities offered by the combined companies," Tollett said.
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