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Tyson cuts profit outlook again as beef segment worsens
Move comes one month after Tyson cut its outlook for the fiscal year
(David Ryder/Getty Images)
Key Takeaways:
- Tyson Foods cut its full-year earnings outlook again Sept. 3 and warned of deeper losses in its beef segment due to ongoing cattle shortages.
- The company now projects adjusted operating income of $1.85 billion to $2.05 billion and beef operating losses of $625 million to $775 million.
- CEO Donnie King said worsening cattle-cycle pressures prompted decisive action as Tyson faces continued challenges in its beef business.
Tyson Foods Inc. cut its outlook for the fiscal year again as it sees more pressure from its beef segment.
Tyson shares fell 6.8% in premarket trading Sept. 3.
READ MORE: Tyson to close more beef plants as cattle shortage drags on
The U.S.’s largest meatpacker said in a statement that the change was driven by “significant margin compression” amid a severe cattle shortage, and the expected impact of lower cattle prices on the value of live cattle inventories.
Tyson now sees annual adjusted operating income of $1.85 billion to $2.05 billion. That comes just one month after the company cut its outlook for the fiscal year to $2.1 billion to $2.3 billion.
It now sees beef operating losses between $625 million to $775 million, compared to a prior outlook ranging from $500 million to $650 million.
“The beef pressures that have intensified this quarter reflect industrywide cattle-cycle dynamics that required decisive action,” said Donnie King, president and CEO.
Tyson ranks No. 8 on the Transport Topics Top 100 list of the largest private carriers in North America and No. 1 among agriculture/food processing carriers.
