Tyson sees first quarter growth driven by prepared foods
In the first quarter of 2018, the business posted a 5.9% year-on-year rise in overall sales, driven mostly by prepared foods.
Its beef division saw a 5.4% rise in sales compared to the first quarter of 2017. Pork saw a similar year-on-year rise in sales at 5.2% while chicken didn’t fare quite as well with a 3.2% rise. Tyson’s prepared foods division saw a 8.4% growth, driving the overall business to a 5.9% rise.
On the beef, sales volume increased due to “improved availability of cattle supply, stronger demand for beef products and increased exports”. Average sales price increased as demand for our beef products and strong exports outpaced the increase in live cattle supplies.
Although Tyson’s pork sales volumes decreased, the average sales price increased due to price increases associated with higher livestock costs. Its chicken sales volumes were up due to strong demand for chicken products along with the incremental volume from the AdvancePierre acquisition.
Its fastest-growing division for the quarter, prepared foods, saw sales volume increased primarily from incremental volumes from the AdvancePierre acquisition. Average sales price increased from higher input costs of $45 million and product mix which was positively impacted by the acquisition of AdvancePierre.
Tom Hayes, Tyson Foods president and chief executive officer, said:
“Building on our momentum from a record year in fiscal ’17, we’re off to a strong start in fiscal ’18. We delivered record adjusted EPS and our second-strongest quarter of operating income in Q1, with operating cash flows of more than $1.1 billion.
“The strength and diversity of our portfolio are evident. We drove solid results in each of our segments - beef, pork, chicken and prepared foods. We grew topline sales, with our retail and food service sales both outpacing the industry.”
Looking ahead, Hayes added: “As we look to the long-term, we’re confident in our ability to continue growing the business. Demand for protein continues to rise, and we’re well-positioned to take advantage of that opportunity - and to fulfill our aspiration of sustainably feeding the world.”
