Tyson Foods Shares Plummet in Face of Costs & Inflation
US multinational meatpacker Tyson Foods suffered its worst one-day decline in share value after warning that cash-strapped consumers who are best-tightening was likely to affect upcoming results.
The Arkansas-based organisation reported Q2 sales that fell short of analysts' estimates, even though profits surpassed expectations, reports Reuters.
Tyson Foods CEO Donnie King said on a conference call that the company also expects Q3 results to be weaker than Q4 due to poor performance in its pork and prepared foods divisions, due to high costs in prepared foods. Its shares closed down 5.7%, but at one time took a 9% tumble.
Melanie Boulden, Tyson Prepared Foods President said that inflation is pressuring consumers, “particularly lower-income households, at retail stores and food-service outlets”.
Since the start of 2023, the company has Tyson has closed six of its chicken plants in the US, has laid off a raft of employees and also announced plans to close a pork plant – all in a bid to control costs.
Reuters reports that Tyson has worked to revive its chicken business for years but that it struggled with an excess of supply in 2023.
In the wake of the company’s unwanted financial landmark, we profile Tyson, a company that has been at the heart of the US meat industry for approaching 100 years.
Tyson Foods: A North American Meat Processing Powerhouse
Founded in 1935 and headquartered in Springdale, Arkansas, Tyson Foods has grown into one of the world's largest processors and marketers of chicken, beef, and pork.
With an estimated 141,000 employees, the company operates major production and distribution facilities across the US.
Today, Tyson operates major production complexes and 50 distribution centres spanning from Washington to Florida. Key facilities are clustered in Arkansas, Texas, Kansas, Nebraska, Iowa and North Carolina.
- 1963: Went public on the NYSE as The Nation's Largest Chicken Company
- 1977: Expanded into beef processing with the acquisition of Valley Fresh
- 2001: Acquired IBP inc, the largest beef and pork company, for $3.2 billion
- 2014: Merged with Hillshire Brands, adding brands like Jimmy Dean and Ball Park
The company's brand portfolio includes Tyson, Jimmy Dean, Hillshire Farm, Ball Park, Wright Brand, Aidells and State Fair, among others. Its meat products are found in retail and foodservice outlets across the US.
Through strategic acquisitions and organic growth, Tyson has solidified its position as a global leader in the meat market.
