Tyson Foods posts hefty fiscal 2009 accounting loss
by November 23, 2009 7:38 am 72 views
Tyson Foods Inc. closed its fiscal year with a decent fourth quarter earnings of 28 cents per share, beating analysts estimate and the fourth quarter 2008 earnings of 14 cents per share.
However, a non-cash ledger adjustment of $560 million to devalue assets in the company’s beef segment pushed the company to an accounting loss of $455 million for the quarter and $537 million on the year.
Fourth quarter revenue was $7.214 billion, up just 0.18% over the same period of 2008. Revenue for all of fiscal 2009 was $26.704 billion, down 0.58% from the 2008 period.
Part of the challenge for Springdale-based Tyson Foods is finding a profit margin amidst average year-over-year price declines in its four segments. According to the Tyson Foods earnings statement, the company saw an 8.8% increase in fiscal 2009 chicken segment volume sold and a 0.2% price decline; 0.5% increase in beef volume and an 8% price decline; a 1.7% increase in pork volume and a 6.1% price decline; and a 5.2% increase in prepared foods volume and a 0.6% price decline.
The company touted its improved performance in the chicken segment — two consecutive quarters of growth — and a fiscal 2009 cash flow of $1.025 billion compared to $288 million in fiscal 2008. However, the company’s long-term debt jumped from $2.88 billion at the end of fiscal 2008 to $3.33 billion at the end of fiscal 2009.
“Fiscal 2010 should be a much better year," Jim Lochner, Tyson’s new chief operating officer, said in the statement. "We think Beef, Pork and Prepared Foods will continue with a solid performance, and we expect the steps we’ve taken to improve Chicken will manifest themselves. Also, USDA data point to lower overall protein supplies, and there is potential for good demand improvement as the global economy recovers."
The board of Springdale-based Tyson Foods Inc. on Nov. 19 named Donnie Smith the new CEO and Lochner the new chief operating officer. Leland Tollett had served 11 months as interim CEO. The promotions were effective immediately.
For 2010, Tyson Foods expects the chicken segment to see higher demand and lower grain costs. In beef, the company sees no real market changes other than a reduction in cattle supplies (1-2%). The pork segment should see a reduction in hog supplies.