Meat + Poultry - July 2005 - 8

Business Notes
Tyson workers at Wallula plant get pay raise
After labor negotiations that lingered
for months, Tyson Foods, Inc., Springdale, Ark., recently gave workers at
its beef plant in Wallula, Wash., their
first pay raises in two years, along
with enhanced 401(k) retirement
savings plans and additional vacation
time for longtime workers. Pay raises
for the plant workers were put on hold
for two years while a labor agreement
between Tyson and the former union
was negotiated when the previous
contract at the plant expired in 2003.
This past February, Teamsters union
Local 556 was decertified after a
vote among plant workers indicated
representation was no longer desired
among most employees.
According to Tyson spokesman,

Gary Mickelson, slaughter and processing workers earning more than the
starting wage of $9 per will receive pay
increases from 65 cents to $1 an hour,
up to $12.90 an hour. About 1,450 of
the plant's 1,600 workers qualify for
pay increases.
Tyson also upgraded its contribution
to the Wallula workers' 401(k) retirement plan, increasing the company's
matching funds to a dollar-for-dollar
match up to 3 percent of employees' salaries, Mickelson said. Other
changes include offering a fourth week
of vacation time to employees who
have worked for Tyson for 20 years
or more.
Plant manager Ray McGaugh says
the workers are being paid back for

ConAgra attributes lower profits to meat business
This past month, ConAgra Foods, Inc.,
Omaha, Neb., posted a 40-percent drop
in its fiscal fourth quarter profits due to
higher pork and beef costs. Officials
also announced that it plans to shut
down some plants to cut costs but didn't
name specific facilities.
The company reported earnings of
$101.9 million, or 20 cents per share
for the fourth quarter, ended May 29,
compared to previous-year earnings of
$169.3 million, or 32 cents per share
including charges of 6 cents per share
related to severance payouts.
Fourth-quarter sales fell 3.6 percent
to $3.71 billion due in part to the estimated impact of an additional week
in the same period this
past year.
Excluding the benefit
of an extra week last
year, sales increased 4
percent in the fourth
quarter. The company
said fiscal 2005 was characterized by
a solid first half followed by a weak
second half.
Sales of its retail products, which
make up 60 percent of the company's
annual sales, were $2.1 billion during
10

I

MEAT&POULTRY

I

July 2005

I

the quarter, down 6 percent from the
same period last year.
Operating profit in the retail segment
dropped by approximately 24 percent,
to $243 million, compared to $319 million during the fourth quarter last year.
Packaged meat, which makes up
one-fourth of the retail division, saw a
12 percent, $15-million drop in profits
for the quarter, which offset modest
gains in sales of about 2 percent from
the company's top brands, according to
Bruce Rohde, president and C.E.O.
"It was purely our execution," Rohde
said. "We had about $180 million in
input increases higher than we expected
and longer than we expected, and we did
not execute well in the
marketplace."
Rohde also said the
company will become
more streamlined in
the coming year by
cutting back on its
brands, enhancing capacity and productivity at its 150 processing plants, and
by eliminating 1,000 jobs. The job cuts
should be complete by the end of the
summer and eventually translate into
$100 million in savings each year.

www.MEATPOULTRY.com

their perseverance. "We're pleased to
reward their patience and the confidence in our leadership with these pay
and benefit improvements," McGaugh
said in a prepared statement.
In January 2006, Tyson also plans
to switch Wallula plant workers from
their former union contract health plan
to a company benefits program, Mickelson said.

Hain Celestial acquires
College Hill Poultry
The Hain Celestial Group, Inc.,
Melville, N.Y., has established a
joint venture with Pegasus Capital Advisors L.P. to purchase the
poultry processing assets of College Hill Poultry, Fredericksburg,
Pa. Under the agreement, Hain
Celestial, through its Hain Pure
Protein Corp., will control 50.1
percent of the joint venture, which
closed on July 1.

The terms of the agreement
include certain rights to use College Hill's Raised Right brand of
natural and organic, free-range
chicken.
"We are excited about entering
the specialty poultry business with
naturally raised chicken, a fastgrowing category in the natural
and organic marketplace," said
Irwin Simon, president and C.E.O.
of the Hain Celestial Group. "This
investment with Pegasus provides
us with the ability to expand both
our fresh, refrigerated and frozen
chicken offerings to meet increasing consumer demand for natural
foods of all varieties."
http://www.MEATPOULTRY.com
Meat + Poultry - July 2005

Table of Contents for the Digital Edition of Meat + Poultry - July 2005
