The shares of Tyson Foods Inc (TSN.N) on Monday came down by nearly 16 percent after the biggest meat processor in the nation forecasted lower-than-expected profit in 2017 and said Donnie Smith; the Chief Executive would step down at the year end.
The company reported that the quarterly results were disappointing owing to the increased investment spending and also due to the chicken shortfalls and the prepared food businesses that the shares fell 15.4 percent reaching to $56.97.
Ball Park hot dogs and Jimmy Dean Sausage seller anticipates a profit a share to be at $4.70 to $4.85 by 2017 September. This is much below the average estimate of $4.98.
Tom Hayes, the Company president, will succeed Smith, 56, who is at the helm since 2009 November. Hayes, 51, was the earlier chief supply chain officer for Hillshire Brands Co that was purchased in 2014 by Tyson.
Tyson canceled with journalists its regular earnings call and is looking to sell “value-added” items more and this includes the pre-seasoned products, besides the heat-and-serve meals, that bring in higher margins than the regular basic meats.
Tyson’s sales fell 12.8 percent in the 4th quarter that ended Oct. 1 and this was a straight fourth quarter of declines. It was due to the reduced beef prices and also due to the switch to value-added items in the chicken business. However, during the quarter, the chicken business of Tyson was hit hard and the soybean meal costs saw a spike