One of the world’s largest meat producers, Tyson Foods, has reported a US$5 mln loss in its second quarter. This, according to the company, is a result of high feed and fuel costs.
Tyson lost 2 cents per diluted share in the three months ending 29 March, versus a profit of $68 mln or 19 cents per share in same period a year ago. The loss includes $47 mln in charges for plant closings and asset impairments, or 8 cents per share.
The loss came even as revenues rose to $6.6 billion in the quarter from $6.5 billion in the year-earlier period.
Tyson well positioned
Tyson Foods President and CEO Richard L. Bond said that, despite the increased costs, the company had a strong quarter. He did, however, criticise government policy on ethanol production, saying the amount of fuel produced has a negligible impact on oil imports while the price of corn is skyrocketing, driving up the cost of food.
Prices have not caught up to the added costs that Tyson is facing, and Bond said prices on the consumer end will continue to rise. As those prices go up, Bond said Tyson will be well positioned as consumers try to save money.
Chicken – over $60 mln loss
Chicken accounts for 33% of the company’s sales; $2.2 bln for the second quarter. The segment lost $61 mln for the quarter, though sales increased in price and volume from a year before.
Bond stated that the company has no plans to reduce chicken production.