Tyson Foods, Inc. (NYSE: TSN), today reported $0.08 diluted earnings per share for the fourth quarter ended September 30, 2000, compared to $0.18 in the same quarter last year. Fourth quarter earnings were $18 million compared to $41 million for the same period last year.
Total fourth quarter sales for fiscal 2000 were $1.78 billion compared to $1.82 billion last year, a decrease of 1.9 percent with a 0.8 percent decrease in volume. Gross profits for the fourth quarter of fiscal 2000 were $235 million compared to $331 million in the same quarter last year with gross margin at 13.2 percent compared to 18.2 percent last year.
Diluted earnings per share for fiscal 2000 was $0.67 compared to $1.00 in the same period last year. Earnings for fiscal 2000 were $151 million compared to $230 million from the same period last year.
Sales for fiscal 2000 were $7.16 billion compared to $7.36 billion last year, a decrease of 2.8 percent. The decrease in sales is mainly due to the sale of seafood and other non-core businesses during fiscal 1999. Comparable sales increased 0.6 percent on a volume increase of 0.3 percent versus the same period last year.
The results for fiscal 2000 were adversely affected by a $24 million charge related to the January 31, 2000, bankruptcy filing by AmeriServe. Excluding that charge, fiscal 2000 earnings were $167 million, or $0.74 per diluted share.
John Tyson, Chairman, President and CEO, said, "Our people worked hard this year in a tough environment, and they made several accomplishments we should be proud of. We managed our way through a 3 percent production cut in response to the industry oversupply situation. At the same time, we continued to grow our core value-added business and reduce our inventories. Our strong cash flow allowed us to continue to pay down debt, buy back stock and invest in our business during a period when we believe many of our competitors were losing money. I can't predict when the supply situation will abate, but I believe we are better positioned for the future."
The Company presently identifies segments based on the products offered and the nature of customers. This results in the following reported business segments: Food Service, Consumer Products, International, Swine and Other. The Company measures segment profit as gross profit less selling expenses. Information on segments is as follows:
Fourth Quarter Segment Review
Food Service fourth quarter sales decreased 0.8 percent compared to the same period last year, with a 2.2 percent decrease in volume offset somewhat by a 1.4 percent increase in average sales prices. Segment profit for Food Service decreased $39 million from the same period last year due primarily to lower market prices, product mix changes and higher grain costs.
Consumer Products fourth quarter sales were comparable to the same period last year, with a 5 percent increase in volume offset by a 4.8 percent decrease in average sales prices. Segment profit for Consumer Products decreased $31 million from the same period last year due primarily to lower market prices, product mix changes and higher grain costs.
International fourth quarter sales decreased 7.9 percent from the same period last year, with a 5.7 percent decrease in volume and a 2.4 percent decrease in average sales prices. The decrease in sales dollars and volume are related to Tyson de Mexico and the third quarter outbreak of the Exotic Newcastle disease. Segment profit for International decreased $19 million from the same period last year with $8 million related to Tyson de Mexico and the remainder due to lower volumes and a change in product mix.
Swine fourth quarter sales increased 29 percent over the same period last year, with a 41.1 percent increase in average sales prices offset somewhat by an 8.6 percent decrease in volume. Segment profit for Swine improved $16 million over the same period last year due to the increase in average sales prices.
Other fourth quarter sales decreased 8.8 percent from the same period last year, with a $27 million decrease in segment profit. The other group consists of the prepared foods group, the chicken breeding stock subsidiary and specialty products.
Fiscal 2000 Segment Review
Food Service fiscal 2000 sales decreased 1.3 percent compared to the same period last year, with a 1.4 percent decrease in average sales prices offset somewhat by a 0.2 percent increase in volume. Segment profit for Food Service decreased $114 million from the same period last year due primarily to lower market prices, product mix changes and higher grain costs.
Consumer Products fiscal 2000 sales were comparable to the same period last year, with a 0.6 percent decrease in average sales prices somewhat offset by a 0.6 percent increase in volume. Segment profit for Consumer Products decreased $96 million from the same period last year due primarily to lower market prices and higher grain costs, which more than offset the improved product mix.
International fiscal 2000 sales increased 1.8 percent over the same period last year, with a 4.2 percent increase in average sales prices offset somewhat by a 2.3 percent decrease in volume. The decrease in volume is mostly related to Tyson de Mexico and the third quarter outbreak of the Exotic Newcastle disease. Segment profit for International decreased $17 million from the same period last year as price improvements for leg quarters were more than offset by decreased volume that resulted from last year's aggressive inventory reductions.
Swine fiscal 2000 sales increased 43.6 percent over the same period last year, with a 56.5 percent increase in average sales prices offset somewhat by an 8.3 percent decrease in volume. Segment profit for Swine improved $82 million over the same period last year due to the increase in average sales prices.
Other fiscal 2000 sales decreased 3.9 percent from the same period last year with segment profit down $15 million. The reduction in other sales is mostly due to non-core businesses sold during fiscal 1999.
The unaudited results are as follows:
Tyson Foods, Inc., headquartered in Springdale, Ark., is the world's largest fully integrated producer, processor and marketer of chicken and chicken-based convenience foods, with 68,000 team members and 7,400 contract growers in 100 communities. Tyson has operations in 18 states and 15 countries and exports to 73 countries worldwide. Tyson is the recognized market leader in almost every retail and foodservice market it serves. Through its Cobb-Vantress subsidiary, Tyson is also a leading chicken breeding stock supplier. In addition, Tyson is the nation's second largest maker of corn and flour tortillas under the Mexican Original® brand, as well as a leading provider of live swine.
A spreadsheet of the following numbers will soon be available at www.tyson.com/investorrel/finrelease/q400.xls.
Financial information, such as this news release, as well as other historical data and current Company information can now be accessed from the Company's web site on the internet at http://www.tyson.com.
Total fourth quarter sales for fiscal 2000 were $1.78 billion compared to $1.82 billion last year, a decrease of 1.9 percent with a 0.8 percent decrease in volume. Gross profits for the fourth quarter of fiscal 2000 were $235 million compared to $331 million in the same quarter last year with gross margin at 13.2 percent compared to 18.2 percent last year.
Diluted earnings per share for fiscal 2000 was $0.67 compared to $1.00 in the same period last year. Earnings for fiscal 2000 were $151 million compared to $230 million from the same period last year.
Sales for fiscal 2000 were $7.16 billion compared to $7.36 billion last year, a decrease of 2.8 percent. The decrease in sales is mainly due to the sale of seafood and other non-core businesses during fiscal 1999. Comparable sales increased 0.6 percent on a volume increase of 0.3 percent versus the same period last year.
The results for fiscal 2000 were adversely affected by a $24 million charge related to the January 31, 2000, bankruptcy filing by AmeriServe. Excluding that charge, fiscal 2000 earnings were $167 million, or $0.74 per diluted share.
John Tyson, Chairman, President and CEO, said, "Our people worked hard this year in a tough environment, and they made several accomplishments we should be proud of. We managed our way through a 3 percent production cut in response to the industry oversupply situation. At the same time, we continued to grow our core value-added business and reduce our inventories. Our strong cash flow allowed us to continue to pay down debt, buy back stock and invest in our business during a period when we believe many of our competitors were losing money. I can't predict when the supply situation will abate, but I believe we are better positioned for the future."
The Company presently identifies segments based on the products offered and the nature of customers. This results in the following reported business segments: Food Service, Consumer Products, International, Swine and Other. The Company measures segment profit as gross profit less selling expenses. Information on segments is as follows:
Sales by Segment
Three Months Ended Fiscal Year Ended
September 30, October 2, September 30, October 2,
2000 1999 2000 1999
Food Service $837 $843 $3,312 $3,354
Consumer Products 570 570 2,250 2,252
International 156 171 657 645
Swine 39 30 157 110
Seafood --- 6 --- 189
Other 179 196 782 813
Total $1,781 $1,816 $7,158 $7,363
Segment Profit
Three Months Ended Fiscal Year Ended
September 30, October 2, September 30, October 2,
2000 1999 2000 1999
Food Service $28 $67 $197 $311
Consumer Products 22 53 145 241
International 7 26 50 68
Swine 4 (12) 19 (63)
Seafood --- --- --- 22
Other 37 64 140 155
Total $98 $198 $551 $734
Fourth Quarter Segment Review
Food Service fourth quarter sales decreased 0.8 percent compared to the same period last year, with a 2.2 percent decrease in volume offset somewhat by a 1.4 percent increase in average sales prices. Segment profit for Food Service decreased $39 million from the same period last year due primarily to lower market prices, product mix changes and higher grain costs.
Consumer Products fourth quarter sales were comparable to the same period last year, with a 5 percent increase in volume offset by a 4.8 percent decrease in average sales prices. Segment profit for Consumer Products decreased $31 million from the same period last year due primarily to lower market prices, product mix changes and higher grain costs.
International fourth quarter sales decreased 7.9 percent from the same period last year, with a 5.7 percent decrease in volume and a 2.4 percent decrease in average sales prices. The decrease in sales dollars and volume are related to Tyson de Mexico and the third quarter outbreak of the Exotic Newcastle disease. Segment profit for International decreased $19 million from the same period last year with $8 million related to Tyson de Mexico and the remainder due to lower volumes and a change in product mix.
Swine fourth quarter sales increased 29 percent over the same period last year, with a 41.1 percent increase in average sales prices offset somewhat by an 8.6 percent decrease in volume. Segment profit for Swine improved $16 million over the same period last year due to the increase in average sales prices.
Other fourth quarter sales decreased 8.8 percent from the same period last year, with a $27 million decrease in segment profit. The other group consists of the prepared foods group, the chicken breeding stock subsidiary and specialty products.
Fiscal 2000 Segment Review
Food Service fiscal 2000 sales decreased 1.3 percent compared to the same period last year, with a 1.4 percent decrease in average sales prices offset somewhat by a 0.2 percent increase in volume. Segment profit for Food Service decreased $114 million from the same period last year due primarily to lower market prices, product mix changes and higher grain costs.
Consumer Products fiscal 2000 sales were comparable to the same period last year, with a 0.6 percent decrease in average sales prices somewhat offset by a 0.6 percent increase in volume. Segment profit for Consumer Products decreased $96 million from the same period last year due primarily to lower market prices and higher grain costs, which more than offset the improved product mix.
International fiscal 2000 sales increased 1.8 percent over the same period last year, with a 4.2 percent increase in average sales prices offset somewhat by a 2.3 percent decrease in volume. The decrease in volume is mostly related to Tyson de Mexico and the third quarter outbreak of the Exotic Newcastle disease. Segment profit for International decreased $17 million from the same period last year as price improvements for leg quarters were more than offset by decreased volume that resulted from last year's aggressive inventory reductions.
Swine fiscal 2000 sales increased 43.6 percent over the same period last year, with a 56.5 percent increase in average sales prices offset somewhat by an 8.3 percent decrease in volume. Segment profit for Swine improved $82 million over the same period last year due to the increase in average sales prices.
Other fiscal 2000 sales decreased 3.9 percent from the same period last year with segment profit down $15 million. The reduction in other sales is mostly due to non-core businesses sold during fiscal 1999.
The unaudited results are as follows:
CONSOLIDATED CONDENSED
STATEMENTS OF INCOME
(In millions except per share data)
Three Months Ended Fiscal Year Ended
Sept. 30, Oct. 2, Sept. 30, Oct. 2,
2000 1999 2000 1999
Sales $1,781 $1,816 $7,158 $7,363
Cost of Sales 1,546 1,485 6,044 6,054
Gross Profit 235 331 1,114 1,309
Expenses:
Selling 137 133 563 575
General and administrative 43 35 169 134
Loss on sale of seafood assets --- 60 --- 77
Amortization 9 9 34 36
Operating Income 46 94 348 487
Other Expense (Income):
Interest 28 30 115 124
Foreign currency exchange (2) 2 --- (3)
Other (6) (1) (1) (5)
Income Before Taxes on Income
And Minority Interest 26 63 234 371
Provision for Income Taxes 8 19 83 129
Minority Interest --- 3 --- 12
Net Income $18 $41 $151 $230
Diluted Earnings Per Share $0.08 $0.18 $0.67 $ 1.00
Diluted Average Shares
Outstanding 225 229 226 231
Dividends Per Share:
Class A $0.040 $0.040 $0.160 $0.115
Class B $0.036 $0.036 $0.144 $0.104
Sales Growth (Decline) (1.9%) (12.2%) (2.8%) (0.7%)
Margins: (Percent of Sales)
Gross Profit 13.2% 18.2% 15.6% 17.8%
Operating Income 2.6% 5.2% 4.9% 6.6%
Income Before Taxes on Income
And Minority Interest 1.5% 3.4% 3.3% 5.0%
Net Income 1.0% 2.3% 2.1% 3.1%
CONSOLIDATED CONDENSED
BALANCE SHEETS
(In millions except per share amounts)
Assets September 30, October 2,
2000 1999
Current Assets:
Cash and cash equivalents $43 $30
Accounts receivable, net of allowance 520 603
Inventories 965 989
Assets held for sale 2 75
Other current assets 46 30
Total Current Assets 1,576 1,727
Net Property, Plant and Equipment 2,141 2,185
Excess of Investments over Net Assets Acquired 937 962
Investments and Other Assets 200 209
Total Assets $4,854 $5,083
Liabilities and Shareholders' Equity
Current Liabilities:
Notes payable $62 $66
Current portion of long-term debt 123 223
Trade accounts payable 346 390
Other accrued liabilities 355 308
Total Current Liabilities 886 987
Long-Term Debt 1,357 1,515
Deferred Income Taxes 385 398
Other Liabilities 51 55
Shareholders' Equity:
Common stock ($.10 par value)
Class A-authorized 900 million shares:
Issued 138 million shares at 9-30-00 and
10-2-99 14 14
Class B-authorized 900 million shares:
Issued 103 million shares at 9-30-00 and
10-2-99 10 10
Capital in excess of par value 735 740
Retained earnings 1,715 1,599
Other accumulated comprehensive income (5) (1)
2,469 2,362
Less treasury stock, at cost- 16 million shares
at 9-30-00 and 12 million shares at 10-2-99 284 232
Less unamortized deferred compensation 10 2
Total Shareholders' Equity 2,175 2,128
Total Liabilities and Shareholders' Equity $4,854 $5,083
CONSOLIDATED CONDENSED
STATEMENTS OF CASH FLOWS
For the Twelve Months Ended
(In millions)
September 30, October 2,
2000 1999
Cash Flows from Operating Activities:
Net income $151 $ 230
Adjustments to reconcile net income
to cash provided by operating activities:
Depreciation 257 255
Amortization 34 36
Amortization of deferred compensation 3 ---
Bad debt expense 25 16
Loss on the sale of assets and other charges --- 77
Foreign currency exchange --- (3)
Minority interest --- 12
Deferred income taxes 47 (13)
(Gain) Loss on dispositions of assets 4 (1)
Decrease in accounts receivable, net 57 9
(Increase) decrease in inventories 84 (99)
Increase (decrease) in trade accounts payable (46) 21
Net change in other current assets and
other current liabilities (29) 7
Cash Provided by Operating Activities 587 547
Cash Flows from Investing Activities:
Additions to property, plant and equipment (196) (363)
Proceeds from disposition of assets 4 234
Net change in other assets and liabilities (14) (37)
Cash Used for Investing Activities (206) (166)
Cash Flows from Financing Activities:
Net change in notes payable (4) (19)
Proceeds from long-term debt 7 76
Repayments of long-term debt (266) (382)
Purchases of treasury shares (69) (52)
Other (34) (18)
Cash Used for Financing Activities (366) (395)
Effect of Exchange Rate Change on Cash (2) (2)
(Decrease) Increase in Cash and Cash Equivalents 13 (16)
Cash and Cash Equivalents at Beginning of Period 30 46
Cash and Cash Equivalents at End of Period $43 $30
Tyson Foods, Inc., headquartered in Springdale, Ark., is the world's largest fully integrated producer, processor and marketer of chicken and chicken-based convenience foods, with 68,000 team members and 7,400 contract growers in 100 communities. Tyson has operations in 18 states and 15 countries and exports to 73 countries worldwide. Tyson is the recognized market leader in almost every retail and foodservice market it serves. Through its Cobb-Vantress subsidiary, Tyson is also a leading chicken breeding stock supplier. In addition, Tyson is the nation's second largest maker of corn and flour tortillas under the Mexican Original® brand, as well as a leading provider of live swine.
A spreadsheet of the following numbers will soon be available at www.tyson.com/investorrel/finrelease/q400.xls.
Financial information, such as this news release, as well as other historical data and current Company information can now be accessed from the Company's web site on the internet at http://www.tyson.com.
