Tyson reports $159 million net income for second quarter 2011
First six months reach $457 million
Tyson Foods Inc. reported a net income of $159 million for the second quarter of 2011 and $457 million for the first six months, holding steady for the quarter and gaining $138 million for the year so far compared to 2010 numbers.
Chicken operating income was down for the second quarter compared to 2010 ($37 million compared to $114 million) but up for the first six months ($218 million compared to $192 million). Pork showed the greatest growth over 2010, with an operating income of $146 million for the second quarter of 2011 (compared to $69 million for 2010) and $323 million for the first six months (compared to $131 million).
Sales were up for both chicken and pork over 2010 numbers. "Overall, it was a solid quarter and I'm pleased with the results," said Donnie Smith, Tyson Foods' president and CEO. "We produced record sales for the second quarter on substantially higher sales prices in addition to increased volume. All segments except chicken were within or above their normalized operating margin ranges. While chicken was well below its normalized range, it was profitable, and we believe it will continue to be profitable in the third and fourth quarters."
In spite of high feed prices, Tyson said it expects its chicken segment to remain profitable for the rest of 2011. "A significant portion of our increased capital expenditures focus on production and labor efficiencies, yield improvements and sales mix flexibility," said Smith. "These improvements, which began in late fiscal 2010 and are scheduled to continue throughout fiscal 2011, are expected to result in $200 million of operational improvements in fiscal 2011."
The company's pork segment is expected to remain above margins, but will not be as profitable in the second half of 2011 as it was in the first half. "We expect hog supplies in fiscal 2011 to be comparable to fiscal 2010 and to be adequate in the regions in which we operate," said Smith. "We expect pork exports to remain strong in fiscal 2011."