Experts Say Monday's Earnings Report May Be Good News For Tyson Foods' Struggling Beef Sector

US - The multi-million dollar question that has puzzled Tyson Foods Inc. executives is not, “Where’s the beef,” but more like, “Where’s the money in beef.”
calendar icon 17 May 2007
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Despite beef sales of $26.46 billion over the last two years, the meat giant’s beef operation has struggled to find positive operating income. Beef export bans, supply imbalances and rising feed costs haven’t helped.

It has been 10 quarters since the world’s largest meat packer has turned a profit in beef — bleeding red ink of $279 million in that time.

The tide may be turning as experts predict that on Monday, Springdale-based Tyson Foods will report better news for its battered beef segment.

Hedgersedge.com calculates net beef processing margins of $4.51 per head for the first 13 weeks of the year, which coincide with Tyson Foods’ second-quarter reporting period.

A tight margin, no doubt, but Steve Kay, editor of Cattle Buyers Weekly, said the company might turn a slight profit in its beef segment in its Monday earnings announcement.

Tyson Foods does not forecast individual operating segment results and has refrained from giving individual quarterly earnings guidance this fiscal year.

Source: The Morning News
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