Tyson Foods Inc. (NYSE: TSN) reported its second quarter financial results Monday before the opening bell and missed analysts’ estimates in both revenue and estimates, sending shares 4 percent lower during pre-market hours.
For the second quarter, Tyson reported revenue of $9.77, increasing 7.6 percent year over year, but short of analysts’ estimates of $9.64 billion. The company reported an EPS of $1.27, up 26 percent year over year, but narrowly missing analysts’ estimates of $1.32.
"We are continuing to grow our business as we create a modern food company focused on protein,” said Tom Hayes, president and chief executive officer of Tyson Foods. “Sales, volume, adjusted operating income and adjusted EPS all increased in the fiscal second quarter vs. the same period last year. Up against challenging conditions, we delivered solid results in all four of our segments.”
Tyson’s strong sales were driven by prepared foods growth. Prepared food sales grew by 10.6 percent to $2.14 billion. Beef reported sales of $3.68 billion, increasing 3.7 percent year over year. Chicken sales increased by 3.6 percent to $2.59 billion.
Pork sales was the only segment to report declining revenue. Sales fell by 1.8 percent year over year. Tyson said the decreased sales were a result of it balancing its supply with customer demand during a period of margin compression.
“We’ve built a strong foundation of sustainable growth that positions us well for the second half of the fiscal year and beyond. We’re outpacing the food and beverage industry today.” added Hayes.
The Tax Reform positively affected Tyson’s second quarter and six month adjusted EPS by $0.17 and $0.38, respectively. For 2018, Tyson is forecasting an adjusted EPS between $6.55 to $6.70, including the benefit of the tax reform rates.