Tyson Foods Q2 2022 Earnings Report
Key Takeaways
Tyson Foods reported strong Q2 2022 results driven by improving operational execution and strong customer and consumer demand. The company saw increases in sales and operating income compared to the previous year.
GAAP EPS of $2.28, up 75% from prior year; Adjusted EPS of $2.29, up 71% from prior year
GAAP operating income of $1,156 million, up 61% from prior year; Adjusted operating income of $1,161 million, up 57% from prior year
Total Company GAAP operating margin of 8.8%; Adjusted operating margin of 8.9%
Liquidity of $3.4 billion at April 2, 2022
Tyson Foods
Tyson Foods
Tyson Foods Revenue by Segment
Forward Guidance
For fiscal 2022, the United States Department of Agriculture (USDA) indicates domestic protein production (beef, pork, chicken and turkey) should be relatively flat compared to fiscal 2021 levels. We expect sales to be $52 billion to $54 billion in fiscal 2022.
Positive Outlook
- We are targeting $1 billion in productivity savings by the end of fiscal 2024 and more than $400 million in fiscal 2022, relative to a fiscal 2021 cost baseline.
- We anticipate another strong year with adjusted operating margin between 11% and 13% in fiscal 2022 for Beef.
- We believe our Pork segment's adjusted operating margin will be 5% to 7% in fiscal 2022.
- We anticipate an adjusted operating margin of 5% to 7% for fiscal 2022 for Chicken as we continue to expect stronger performance in the second half of the fiscal year.
- We believe our adjusted operating margin will be between 8% and 10% in fiscal 2022 for Prepared Foods.
Challenges Ahead
- We anticipate lower results from our foreign operations in fiscal 2022 due to supply chain disruptions and other impacts related to COVID-19.
- USDA projects domestic production will decrease approximately 3% in fiscal 2022 as compared to fiscal 2021 for Pork.
- USDA projects domestic production will increase less than 1% in fiscal 2022 as compared to fiscal 2021 for Beef.
- USDA projects chicken production will increase approximately 1% in fiscal 2022 as compared to fiscal 2021.
- We expect net interest expense to approximate $360 million for fiscal 2022.