990804 Tyson Reports 50% Increase in 3rd Quarter EPSAugust 4, 1999Springdale, AR - Tyson Foods, Inc. reported a 50% increase in diluted earnings per share for the quarter ended July 3, 1999, to $0.30 from $0.20 in the comparable quarter last year. Third quarter earnings increased $21.8 million to $68.4 million from $46.6 million for the same period last year. The Company previously announced the sale of its seafood operations which closed July 17, 1999. Excluding the loss on the sale of the seafood business totaling $16.6 million ($10.5 million after-tax), third quarter earnings were $78.9 million or $0.34 diluted earnings per share. Third quarter sales for fiscal 1999 were $1.88 billion compared to $1.95 billion last year, a decrease of 3.7%. Adjusting for non- comparable factors, consumer poultry sales would have been up 1% on an approximate 8% gain in volume. Gross profits for the third quarter of fiscal 1999 increased $41.8 million to $350.2 million from last year's $308.4 million. Gross margin overall increased 280 basis points to 18.6% from last year's 15.8%. Wayne Britt, Tyson's Chief Executive Officer, said, “This quarter continued the improvement trend in our operating numbers in spite of weaker prices due to an oversupply of chicken and other meats. I attribute this accomplishment to management's focus resulting from our new organizational structure. Price pressure from oversupply continues. We are evaluating our sales/production balance and will cut back our chicken output. Additionally, with our seafood business divestiture complete, we can turn our attention to the final rationalization of our swine business, which we now expect will continue to show losses. “Looking forward to next year, and considering the factors we can control, together with the disciplined plan our team is putting in place, I believe we can continue our year to year earnings improvements.” Diluted earnings per share for the nine months of fiscal 1999 increased 60.8% to $0.82 from $0.51 last year. Earnings increased $74 million to $188.8 million for the nine months of fiscal 1999 compared to $114.8 million from the same period last year. Excluding the loss on the sale of the seafood business, earnings for the nine months were $199.3 million or $0.86 diluted earnings per share. Sales for the nine months of fiscal 1999 were $5.55 billion compared to $5.35 billion last year, an increase of 3.8%. The increase in sales is primarily due to volume gained from the acquisition of Hudson Foods on January 9, 1998, and the inclusion of Tyson de Mexico on a consolidated basis. Gross profits for the nine months of fiscal 1999 increased 16.7% to $977.7 million from last year's $837.9 million. Gross margin overall increased 190 basis points to 17.6% from last year's 15.7%. John Tyson, Chairman of the Board of Directors, said, “I like the way our management team is responding to our current challenges. Our new organization gives team members both the responsibility and the authority necessary for quick responses to the customers and markets we serve. In times like these, when oversupply of all proteins creates challenges, Tyson stands apart because of our team members, products and service. Tyson is by far the nation's number one preferred brand of chicken.”
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