One of the biggest processors of beef, pork, and chicken, Tyson foods reported on Aug 03, 2015, that the soaring cost of cattle has led to a fall of US$84 million in the business of the company in the Q3 of this fiscal year. The company also stated that if the beef market does not improves very soon, the company is afraid that it will not meet its earnings projection for this full-year.
Tyson registered a revenue amounting to US$10.07 billion in Q3, citing an increase of 4% comparing to 2014. However, analysts have expected the company to record US$10.2 billion this time. The company reported the net income for Q3 at US$343 million that results into EPS at 80 cents per share.
Although the per-share profit shows a 7% increase over the last year, but it has missed the estimate of Wall Street on the company by a whopping 15 cents per share.
The president and the CEO of Tyson, Mr. Donnie Smith, stated that their beef business has suffered extensively from the export market disruptions, which had impacted the business by US$84 million in the third quarter, and they continue to see soaring cattle costs at a time when the export issues and product values are making it difficult to materialize projected revenue levels.
Mr. Smith praised his the businesses of chicken and prepared food segments of his company for their robust performances over the third quarter, adding that if cattle costs remain this high, the earnings of Tyson foods will suffer significantly in future.