050509 Tyson Foods Posts Lower 2Q Earnings

Chicago - Top U.S. meat company Tyson Foods Inc. posted lower quarterly earnings as ongoing trade bans related to mad cow disease continued to hurt its beef sector.

Tyson, which leads the nation in beef and chicken production and is No. 2 in pork, said earnings fell 36 percent to $76 million, or 21 cents per share, for the fiscal second quarter ended April 2, from $119 million, or 33 cents per share, a year earlier.

Wall Street analysts on average had expected earnings of 17 cents per share, according to First Call.

A U.S. ban on Canadian cattle since May 2003 has hurt Tyson, because the company had relied on those cattle to supply beef plants. Canadian cattle are banned because of a mad cow case there.

Also, U.S. beef is still banned by many countries after a sole U.S. case of mad cow disease in December 2003. Prior to the bans, the United States had been exporting about 10 percent of its beef.

The beef unit, the company's largest unit, had an operating loss of $19 million, compared with a prior- year loss of $2 million.

The chicken division posted lower operating profit, despite higher sales, in part due to losses on grain hedging operations. The unit had an operating profit of $143 million compared with $189 million a year ago.

Tyson said second-quarter revenue rose to $6.36 billion from $6.15 billion.

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