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Dec 31, 2022
Tyson Foods Q1 2023 Earnings Report
Tyson Foods' Q1 2023 performance reflected a mixed outcome, with record sales growth offset by market challenges and operational inefficiencies, leading to a significant decrease in operating income and earnings per share.
Key Takeaways
Tyson Foods reported a 2.5% increase in sales to $13.26 billion for Q1 2023, but experienced a 68% decrease in operating income to $467 million and a 71% decrease in EPS to $0.88, impacted by market dynamics and operational inefficiencies.
Sales increased by 2.5% to $13.26 billion compared to the prior year.
GAAP operating income decreased by 68% to $467 million, while adjusted operating income also fell by 68% to $453 million.
GAAP EPS decreased by 71% to $0.88, and adjusted EPS decreased by 70% to $0.85.
The company repurchased 4.9 million shares for $313 million and maintained liquidity of $2.9 billion at the end of December 2022.
Revenue by Segment
Forward Guidance
For fiscal year 2023, Tyson Foods anticipates sales between $55 billion and $57 billion, with capital expenditures around $2.5 billion and net interest expense approximating $330 million. The company expects its adjusted effective tax rate to be around 24%.
Positive Outlook
- USDA projects chicken production will increase approximately 3% in fiscal 2023 as compared to fiscal 2022.
- We anticipate an adjusted operating margin of 8% to 10% in fiscal 2023 driven by volume growth, productivity and disciplined revenue management.
- We anticipate improved results from our foreign operations in fiscal 2023.
- We expect total liquidity, which was approximately $2.9 billion at December 31, 2022, to remain above our minimum liquidity target of $1.0 billion.
- We believe we will exceed our aggregate $1 billion target in fiscal 2023, a year ahead of our plan.
Challenges Ahead
- USDA projects domestic production will decrease approximately 5% in fiscal 2023 as compared to fiscal 2022.
- We anticipate an adjusted operating margin of 2% to 4% in fiscal 2023 as margins are expected to decrease from historically high levels.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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