Tyson Foods has posted a second quarter 2006 sales dip to US$6.3bn compared to $6.4bn for the same period last year, blamed on a depressed meat market and oversupply of proteins.

Operating loss at the US company was $141m compared to an operating income of $183m in 2005. Pretax losses included $59m of costs related to beef and prepared foods plant closings.

For the first six months of fiscal 2006 Tyson’s total sales stood at $12.7bn compared to $12.8bn for the same period last year.

Company chairman and CEO John Tyson said: “We said the second quarter would be very tough, and it was even tougher than we anticipated. This quarter’s results reflect the depressed markets and the oversupply of all proteins.

“The beef segment suffered from low capacity utilisation and declining boxed beef prices. The negative effect of high live cattle prices and lower sales prices was made worse by interruptions in export markets. Those factors combined to produce significant losses in the beef segment. The protein oversupply, in addition to higher operating costs, affected our pork segment as well.

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“On the upside, the company’s sales volume increased and the chicken segment stayed in positive territory. Our focus on value-added products and effective management of controllable costs helped our chicken segment’s performance. Also, I am encouraged by our prepared foods segment margins which, when adjusted for plant closings, continue to move in the right direction.”

Tyson recently announced that Wade Miquelon will join the company as CFO in June 2006.

“The impact of the oversupply of protein is expected to diminish in the second half of the year. We expect the third and fourth quarters to be better as demand improves, but they still will be difficult,” added Tyson.