Tyson Foods Q3 Earnings And Sales Beat Estimates

Tyson Foods, Inc. (TSN - Analyst Report) posted third-quarter fiscal 2016 results, wherein both earnings and revenues beat the Zacks Consensus Estimate.

In the fiscal third quarter, adjusted earnings of $1.21 per share surpassed the Zacks Consensus Estimate of $1.07 by 13.08% and improved 51% from the year-ago tally of 80 cents on higher margins.

Revenues and Margins

Net sales gained 6.6% to $9.403 billion due to higher sales across most of segments like chicken, beef, pork and prepared foods segments. Sales outpaced our expectation of $9.23 billion by 1.8%. Sales volume dipped 2.7%, while average sales price (ASP) went down 4.1%.

Tyson Foods Inc. (TSN - Analyst Report) Street EPS & Surprise Percent - Last 5 Quarters | FindTheCompany

TYSON FOODS A Price, Consensus and EPS Surprise

TYSON FOODS A Price, Consensus and EPS Surprise | TYSON FOODS A Quote

Tyson's adjusted operating income surged 35.03% to $767 million due to lower feed costs. Adjusted operating margin rose 260 basis points (bps) to 8.2%.

Segment Details

Chicken: Sales at this segment remained almost flat year over year at $2.74 billion as a 0.9% dip in sales volume was offset by a 0.4% reduction in average price. Sales volume declined due to company’s strategy of optimizing its mix. Average sales price increased in the fiscal third quarter on positive mix.

Beef: Sales at this segment declined 12.12% year over year to $3.78 billion, as 2.9% increase in sales volume was offset by a 14.6% decrease in average selling price (ASP). ASP declined due to higher domestic availability of fed cattle supplies, while sales volume was hurt by reduction in live cattle processed.

Pork: Pork segment sales were up 5.30% year over year to $1.27 billion as 1.7% increase in sales volume was offset by a 7.2% rise in average price.

Prepared Foods: Sales at Prepared Foods remained flat year over year at $1.80 billion as 1.9% gain in volume was offset by an equal decline in ASP. Adjusted sales volume grew on positive mix. Adjusted ASP slipped primarily due to a decline in input costs, partially offset by a change in product mix.

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Disclosure: None.

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