Milling & Baking News Corporate Profiles - 2019 - 110

COMPANY OVERVIEW

Tyson Foods, Inc.
Global protein company fighting global challenges
yson Foods, Inc., Springdale, Ark., faced
challenges during 2019 commensurate
with its global scale. The trade war with
China, an outbreak of African swine fever
(A.S.F.) in Southeast Asia, grain market volatility and a fire at a Kansas beef processing plant
all challenged the company's performance.
The scope of the difficulties facing Tyson
Foods came into view in September, when
the company reduced its fiscal 2019 adjusted
earnings guidance to $5.30 to $5.70 per share
from $5.75 to $6.10 per share. Speaking Sept.
4 at the Barclays Global Consumer Staples conference in Boston, Noel W. White, president and
chief executive officer of Tyson Foods, elaborated on the guidance reduction, saying the
adjustment amounted to approximately $220
million.
Looking ahead, Mr. White said the impact
of A.S.F. in China, which has led to significant
reductions in the Chinese hog herd, will be felt
in fiscal 2020.
"I don't know if that's going to be our Q1,
which is October, November, December; or Q2,"
he said. "But any time that there's that amount
of protein that is lost from a global perspective,
there is going to be an impact on price."
International expansion was a priority for

Tyson Foods in 2019. In June, the company acquired the Thai and European business of meat
processor BRF S.A. The acquisition included
four processing plants in Thailand, one in The
Netherlands and one in the United Kingdom.
"We're now strategically aligned to better
serve customers in Europe, the Middle East,
and Asia, building on our global strategy," Mr.
White said.
Tyson also said approximately 90% of global
protein consumption growth would be outside
the United States in the future, including 60% of
volume growth in Asia over the next five years.
Later in the year, Tyson Foods agreed to buy
a 40% stake in the foods division of Grupo Vibra, a Brazilian poultry producer and exporter.
"This investment will enable us to access poultry supplies in Brazil to meet the growing needs
of Brazilian customers and of priority demand
markets in Asia, Europe and the Middle East,"
said Donnie King, group president, international

and chief administration officer. "It's part of our
strategy to develop a more flexible supply chain
and mitigate the volatility of our previous model,
which relied primarily on U.S. exports."
Not all of management's focus was outside
the United States. The company announced
plans to build a $300 million case-ready meat
plant in Utah. The plant will process cuts of beef
and pork into steaks, chops, roasts and grinds.
The company expects the Utah facility to open
as soon as 2021.
Tyson also invested $34.2 million in a
35,000-square-foot expansion at its poultry
processing plant in Camilla, Ga. The expansion
created 100 new jobs at the facility.
Tyson Foods also launched its first plant-based
and blended products, including a new brand called
Raised & Rooted.
"Today's consumers are seeking more protein
options, so we're creating new products for the
growing number of people open to flexible diets
that include both meat and plant-based protein,"
Mr. White said. "For us, this is about 'and' - not
'or.' We remain firmly committed to our growing
traditional meat business and expect to be a market leader in alternative protein, which is experiencing double-digit growth and could someday be
a billion-dollar business for our company." CP

Chief executive officer -
Noel W. White

Tyson Foods, Inc. net income

Tyson Foods, Inc. net sales

(fiscal years ended in September)

Tyson Foods share price

per share
$100

$1,768

$1,774

$3,024

2016

2017

2018

110 \ November 2019

in millions

$87
$74

$36,881

$38,260

$40,052
$61

2016

2017

2018

$48
Oct.
2018

Dec.

Milling & Baking News * Food Business News * Baking & Snack * Meat+Poultry * Pet Food Processing

Feb.

April

June

Aug.

Oct.

Corporate Profiles

Milling & Baking News Corporate Profiles - 2019

Table of Contents for the Digital Edition of Milling & Baking News Corporate Profiles - 2019