Beef business helps push Tyson Foods to record earnings in fiscal 2017

Tyson Foods posted record per share earnings of $5.31 for fiscal year 2017 thanks in no small part to a 155% operating income increase in the company’s beef segment. Per share earnings for the fiscal year and fourth quarter beat the consensus estimates.

For the fiscal year ended Sept. 30, the Springdale-based global meat company posted revenue of $38.263 billion, better than the $36.881 billion in the previous fiscal year. Net income for the year was $1.774 billion, just ahead of the $1.768 billion in the previous fiscal year. Per share earnings of $5.31 beat the consensus estimate of $5.25.

Fourth quarter revenue was $10.145 billion, up 10.8% compared with the $9.156 billion in the fourth quarter of fiscal 2016. Net income in the quarter was $395 million, compared with $391 million in the fourth quarter of fiscal 2016. Per share earnings of $1.43 was 5 cents better than the consensus estimate of $1.38.

“The fourth quarter was a strong finish to another record year,” Tyson Foods CEO Tom Hayes said in the earnings report posted Monday (Nov. 13) before the markets opened. “We delivered well over our goals of at least 4 percent operating income growth, EPS growth in the high single digits and 3 percent volume growth in value-added products, and expect to meet or exceed these goals again in fiscal 2018.”

SEGMENT NUMBERS
Operating income in the company’s four segments totaled $3.263 billion for the fiscal year, up 15.17% compared to fiscal 2016. Operating income in the segments during the fourth quarter was $902 million, up an impressive 54% compared to the same quarter in 2016.

• Chicken
Fiscal 2017 operating income: $1.117 billion
Fiscal 2016 operating income: $1.305 billion

4Q 2017 operating income: $322 million
4Q 2016 operating income: $220 million

• Beef
Fiscal 2017 operating income: $885 million
Fiscal 2016 operating income: $347 million

4Q 2017 operating income: $313 million
4Q 2016 operating income: $139 million

• Prepared Foods
Fiscal 2017 operating income: $675 million
Fiscal 2016 operating income: $734 million

4Q 2017 operating income: $152 million
4Q 2016 operating income: $133 million

• Pork
Fiscal 2017 operating income: $648 million
Fiscal 2016 operating income: $528 million

4Q 2017 operating income: $124 million
4Q 2016 operating income: $108 million

The company expects to grow revenue to $41 billion in fiscal year 2018, which does not include revenue from the three non-protein businesses it now has up for sale.

“The expected increase in fiscal 2018 sales is attributed to incremental AdvancePierre sales of $1.2 billion, an increase in sales volume in our legacy businesses excluding the impact of sales from the three non-protein businesses, and an increase in pricing predominantly in our Chicken segment,” noted the earnings report.

Company shares (NYSE: TSN) closed Friday at $74.14. During the past 52 weeks the share price has ranged from a $74.30 high to a $55.72 low. The high was hit in Friday’s trading.

Talk Business & Politics will update this story later today.