CHICAGO —
Tyson Foods Inc., the largest U.S. meat processor, said Friday that consumers may be shifting toward buying chicken and away from red meat after the price of beef rose at a faster pace.
Consumers feeling the pressure from increases in payroll taxes and gasoline prices are "eating different meat" rather than less of it, Chief Executive Officer Donnie Smith said during a conference call with analysts Friday.
"What we're beginning to think is that with all of these pressures on consumers today, maybe we are now seeing a legitimate shift from red meat proteins into chicken," he said.
Beef prices have risen for several years as higher feed costs and the recent U.S. drought reduced the cattle herd. Smith's comments may show that the move away from beef, which has been predicted for years, is perhaps finally happening, JPMorgan Chase said in a note.
Sales climbed 0.9 percent to $8.4 billion, trailing the $8.61 billion average of 12 estimates. Full-year revenue will be about $35 billion, compared with the $34.6 billion average of 13 estimates.
Domestic protein production will fall by about 1 percent in Tyson's current fiscal year as drought conditions cut grain supplies, the company forecast. Cattle supplies may decline 2 percent to 3 percent.
Tyson said it will pay about $600 million more for chicken feed in the period. It predicted chicken and hog supplies will be little changed.
While the beef unit accounted for 40 percent of Tyson's sales in the last financial year, it contributed 17 percent of operating profit, data compiled by Bloomberg show. Chicken made up 34 percent of revenue and 35 percent of operating income. Tyson also processes pork.
The company is working on expanding its range of processed chicken products and items for convenience stores, Smith said on a separate call with reporters.
Tyson may look at smaller so-called bolt-on acquisitions, Smith said on the media call. When asked to comment on whether Tyson is interested in purchasing Hillshire Brands Co., Smith said no. Asked to clarify if Smith meant he had no comment or no interest, he said "a little bit of both."
Features
Tyson says consumers may be shifting to chicken from beef
- Features
-
-
Rude teens an example of emotional narcissism
Q: I went into my 17-year-old’s bedroom to wake him this morning. After some urging, he eventually got up and then told me he hated me. What is the appropriate consequence for this sort of disrespect?
-
The would’a, could’a, should’as of Edmond living
“Would’a, could’a, should’a” might be the most useless contractions in the English language — especially when preceded by “if only” — but I’m not letting that stop me.
If only I’d known what was coming, I would’a stayed out of Edmond’s seductive garden shops last weekend, but it’s been a long, cold winter and I couldn’t resist all those colorful flowery offerings begging, “Take me! “Take me!” -
VIDEO: Man hands out Abercrombie clothes on Skid Row in bid to shame brand
Anger has mounted online against clothing retailer Abercrombie & Fitch due to comments made by its chief executive and its strategy of not making women's clothing in any size above large.
-
Feces contaminates 58 percent of public swimming pools
Human feces taints more than half of public swimming pools, a finding U.S. health officials are using to urge better personal hygiene as the summer months approach.
-
VIDEO: One by one, homes in Calif. subdivision sinking
Scott and Robin Spivey had a sinking feeling that something was wrong with their home when cracks began snaking across their walls in March. Within two weeks their property dropped 10 feet below the street.
-
5 takeaways from the IRS report
What are the key takeaways from the Treasury Inspector General for Tax Administration's report on the Internal Revenue Service's decision to subject conservative groups to heightened scrutiny?
-
How to get the most out of your air conditioner this summer
Experts say preventative maintenance on your air conditioner can save you hundreds of dollars.
-
VIDEO: How robots will shape the future
Robots could revolutionize everything from learning to fitness. Tech reporter Rich DeMuro shows how companies are using robots to shape the future.
-
Bodily waste can help solve the energy crisis, author says
Bodily waste is widely considered a topic not to be discussed in polite company; it's something to be flushed and forgotten. But a new book argues that waste, in all its human and animal forms, is worth getting to know intimately.
-
VIDEO: Camera mounted on WTC spire captures installation
A GoPro camera shows the spire as it is permanently installed atop One World Trade Center on Friday, bringing the New York City structure to its symbolic height of 1,776 feet.
- More Features Headlines
-
Rude teens an example of emotional narcissism
