Meat + Poultry - June 2016 - 10

BUSINESS NOTES

TYSON POSTS RECORD Q2 PERFORMANCE
Tyson Foods Inc., Springdale, Arkansas, raised its annual
guidance to $4.20-$4.30, as strong consumer demand along
with lower costs for feed combined to lift the company's
net income 40 percent in the second quarter.
For the quarter ended April 2, Tyson reported net
income of $432 million, or $1.07 per share, compared with
$310 million, or 75 cents per share in the year-ago quarter.
"Our business continues to perform very well,
delivering record second quarter operating income and
return on sales, in what is typically the most challenging
quarter of our fiscal year," Donnie Smith, president and
CEO, said in a statement. "Sales are growing in key retail

"Our business continues to perform
very well, delivering record second
quarter operating income and
return on sales, in what is typically
the most challenging quarter of our
fiscal year." - DONNIE SMITH, TYSON FOODS
product lines. The pricing and marketing investments
we've made are paying off in increased volumes in
strategic products including Hillshire Farm smoked
sausage and lunchmeat, Jimmy Dean breakfast sausage
and Ball Park hot dogs. With a focus on the longer term,
we have a three-year pipeline of innovation across all
segments with exciting new product launches to keep
our offerings in the retail, foodservice and international
channels relevant to consumers."
Sales for the quarter eased 8.1 percent to $9.17 billion
from $9.98 billion. For the six months ended April 2, net
income was $893 million, up from $619 million in the first
six months of fiscal 2015.
Sales for the first six months slipped 12 percent to
$18.3 billion from $20.8 billion reported in the first six
months of fiscal 2015.

HORMEL RAISES GUIDANCE ON Q2
PERFORMANCE, ACQUIRES JUSTIN'S
Hormel Foods Corp., Austin, Minnesota, raised its earnings
guidance based on a strong second quarter in which net
earnings for the company climbed 20 percent on the
strength of the company's Refrigerated Foods business.
"We are raising our fiscal 2016 earnings guidance range
from $1.50 to $1.56 per share to $1.56 to $1.60 per share
based on strong second quarter results and continued
expectations for growth in the back half of the year,"
James P. Snee, president and COO, said in a statement.

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MEAT+ POULTRY | 06.16 | www.meatpoultry.com

For the second quarter, Hormel Foods reported net
earnings of $215.4 million, or 40 cents per diluted share,
for the second quarter, up 20 percent from $180.2 million,
or 33 cents per diluted share a year ago. Earnings per
share measures reflect a two-for-one stock split distributed
on Feb. 9, the company said.
Sales for the quarter climbed 1 percent to $2.3 billion.
"Hormel Foods delivered strong results this quarter,
our twelfth consecutive quarter of record earnings, with
four of five segments achieving double-digit increases in
operating profits," Jeffrey M. Ettinger, chairman and CEO,
said in a statement. "Excellent results in Refrigerated
Foods and Grocery Products were driven by favorable
pork operating margins and solid growth posted by
value-added products..."
In addition to its earnings, Hormel announced an
agreement to acquire Justin's, LLC, maker of Justin's brand
nut butter spreads, squeeze packs, peanut butter cups and
snack packs. Financial terms were not disclosed.
"We are excited to work together with the Justin's team
to bring these great natural and organic products to even
more consumers, leveraging key Hormel Foods resources
to drive continued innovation and growth to this on-trend
category," Snee said.

JBS SWINGS TO Q1 LOSS
Challenges in the market for beef along with foreign
exchange hedging weighed on first-quarter results for São
Paulo, Brazil-based JBS SA.
The company reported a net loss of R$2.76 billion
($789.08 million) in the first quarter of fiscal 2016,
compared to net income of R$1.39 billion ($401.31 million)
in the first three months of 2015.
Wesley Batista, CEO of the Global Business, said
challenges in the JBS USA Beef business weighed on
results, but that the issues the business faced in the first
quarter were not recurring. In a conference call with
analysts on May 12, he also addressed the company's
foreign exchange hedging strategy. The company lost
R$5.8 billion ($1.7 billion).
Batista said that despite the negative impact in the
first quarter, the strategy of being fully hedged worked
well because otherwise JBS would have lost an additional
R$4.8 billion ($1.4 billion). "...so we were able to protect
our results by R$4.8 billion," he said. "So, we again, even
though [there] was an impact in this quarter we believe
that the strategy worked well."
Revenues for the quarter advanced 29.8 percent to
R$43.91 billion ($12.64 billion) from R$33.82 billion ($9.74
billion) reported Q1 2015. EBITDA for the quarter dropped
22.5 percent to R$2.14 billion ($615.20 million) from R$2.76
billion ($793.98 million) compared to a year ago.
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Meat + Poultry - June 2016

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