In the first quarter of its fiscal 2019, ending December 31, Tyson recorded GAAP EPS of US$1.50, down -66% from record prior year, when a one-time tax benefit of US$2.68 was included. Net profits totalled US$551 million against the record results of US$1.631 billion reported in the same quarter of the previous fiscal year. On an adjusted per-share basis, net income for the quarter was US$1.58, down -12.7% from the US$1.81 reported a year ago. GAAP operating income was US$807 million in the quarter, while adjusted operating income stood at US$841 million. Total Company GAAP operating margin was 7.9%, with an adjusted operating margin of 8.3%.
According to Tyson, beef sales volumes decreased due to a reduction in live cattle processed. “Average sales price increased as exports and demand for our beef products remained strong. Operating income increased as we continued to maximise our revenues relative to live fed cattle costs, partially offset by increased operating and labour costs”, said the U.S. processor. Sales volume are also reported to have decreased in the pork and processes food segments, while sales volume in chicken increased primarily due to incremental volume from business acquisitions. On November 30, 2018, Tyson completed the acquisition of Keystone Foods business from Marfrig Global Foods for US$2.3 billion in cash, and the results from domestic operations of this business are included in the chicken segment.
For fiscal 2019, Tyson says the U.S. Department of Agriculture (USDA) indicates domestic protein production (beef, pork, chicken and turkey) should increase approximately +3% from fiscal 2018 levels, but the processor expects domestic availability of protein to increase approximately +2% as export markets should absorb a portion of the increase in production.