Senior decision-makers at Tyson Foods, including CEO Donnie Smith and president Tom Hayes, told investors at the Boston conference the business expects strong single-digit growth in the 2017 fiscal year, and that it plans to make further investments.
“Our adjusted earnings guidance for fiscal 2016 of $4.40-4.50 per share is 40% more than last year and represents a four-year compound annual growth rate of approximately 22%, and we’re confident we can achieve high single digit growth in fiscal 2017,” said Donnie Smith.
He added that the business intends to use its robust cash flow to invest in its the beef chicken and pork lines, either through organic growth or international acquisitions.
The business is also redirecting revenue to its shareholders by increasing dividends and rebuying shares. In the last 12 months, up to 8 August, Smith said Tyson Foods had repurchased around 31m shares. Tyson Foods will continue in similar vein if the company fails to identify any suitable merger and acquisition targets.
The company is also focused on boosting investment to stimulate the volume growth recently enjoyed by its ‘Core 9’ food lines, which include Tyson, Jimmy Dean, Hillshire Farm, Ball Park, Wright, Aidells and State Fair.
“Tyson Core 9 is leading in volume performance among the top 10 consumer packaged goods retail food manufacturers, and Tyson Foods is one of only three companies to show growth in the latest quarter,” said Tom Hayes. He added: “We’re growing sales volume, dollar sales and market share.”
Hayes and Smith told investors in Boston that the business is now producing higher and more stable earnings reinforced by a surge in sales volume growth and an effort to cut $1bn worth of inefficiencies from the business.