Tyson Foods bullish on brands amid disappointing results

Worse-than-expected quarterly results led to Tyson Foods lowering its forecast for full-year sales.

Tyson – one of the companies under fire in the select committee’s report

Tyson Foods’ brands are central to the US meat giant’s growth prospects, the company’s management has argued, after a cut to the company’s sales forecast hit its share price.

The Jimmy Dean and Hillshire Farm brands owner lowered its full-year sales forecast yesterday (8 May) as it posted second-quarter financial results that included a loss of $91m.

Tyson Foods is now expecting full-year sales of $53bn to $54bn against a prior estimate of $55bn to $57bn.


As a result, the company’s shares ended trading yesterday (8 May) at $50.73, down more than 16% on the day.

In a call with analysts to discuss the results, CEO Donnie King pointed to a number of headwinds facing the protein heavyweight, including cost inflation, lower commodity prices for fresh chicken and reduced demand for beef from cash-strapped shoppers which makes it difficult to pass on the expenses in its supply chain.

As a result, second-quarter sales stood at $13.13bn, compared to $13.11bn a year earlier. The company reported an operating loss of $49m compared to a profit of $1.15bn a year earlier. Adjusted operating income for the first half of the fiscal year slumped 80% to $518m.

King told analysts: “This quarter was definitely a tough one … results were weaker than expected and top-line performance was mixed, particularly when compared to our strong performance last year.”

He added: “I can’t remember a time when our business faced the highly unusual situation that we’re currently seeing, where all three of our core protein categories, beef, pork and chicken are experiencing market challenges at the same time. This unusual confluence of issues continued in Q2 and directly impacted our results.”


However, King remains bullish about Tyson Foods’ prospects, especially in relation to its branded products.

“Our branded foods business is the key growth pillar for the future and in Q2, the business performed well. These results were driven by the strength of our share position, especially for our core brands, including Jimmy Dean, Tyson and Hillshire Farm, which helped deliver strong margins compared to the same 13-week period last year,” he said.

King, meanwhile, also pointed to Tyson’s ongoing strategy to cut costs, which he described as “important initiatives to simplify our structure and right-size our team”.

He added: “These are a logical next step in our ongoing efforts to drive operational and functional excellence as we strive to be best-in-class in our industry.”

King told analysts: “We also made the difficult choice earlier this quarter to close two of our less productive chicken plants. These strategic actions are expected to generate significant efficiencies going forward.”

Last month, in another cost-savig measure, Tyson revealed it was to make cuts at the senior executive level.

On a bullish note, King told analysts: “Despite challenging market conditions, we continue to execute our strategy and have significant opportunities in front of us……We continue to invest in automation and digital capabilities with opportunities to improve our yield.”

The dairy companies also present in dairy alternatives

Just Food rounds up what some of the world’s leading dairy businesses are providing in the growing market of dairy alternatives.

In the same way that large meat companies are increasingly offering meat alternatives, the world’s leading dairy businesses, or food majors with a significant position in dairy, are becoming ever more involved in providing dairy alternatives.

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Bonduelle CEO to leave French vegetables group

Chairman Christophe Bonduelle said the company “needs a new lease on life”.

Credit: darksoul72 / Shutterstock.com

Bonduelle CEO Guillaume Debrosse has left the French vegetables supplier.

In a stock-exchange filing, the company said Debrosse, who has been at the helm for five years, has stepped down “by mutual agreement”.

Bonduelle said Debrosse’s successor “will be appointed in the coming weeks”.


In the meantime, chairman Christophe Bonduelle will take on the role.

Mr Bonduelle indicated the company had lined up its new CEO.

He said: “The board of directors and I are convinced that, given the demanding environment in which the company is operating, the group needs a new lease on life.

“The new CEO, whose identity will be announced in the coming weeks, has extensive knowledge of the US market, where he has held general management positions for more than 20 years in several groups in the food sector. I would like to warmly thank Guillaume Debrosse for his professionalism and commitment during his 16 years with the group.”

Debrosse joined the family-controlled Bonduelle in 2007 as finance director for the company’s fresh-products business in Europe.


In the 12 months to 30 June 2022, Bonduelle generated revenue of €2.89bn ($3.19bn), up 4.1% on a year earlier.

However, the company booked a 3.7% fall in current operating income to €96.6m and a 38% slide in net income to €35.4m.

At the time, Bonduelle pointed to “difficulties” in its North American fresh-foods business, as well as the “continuing sanitary [Covid-19] crisis, unfavourable weather conditions [and] the first wave of inflation emphasised by the geopolitical context and the disorganisation of supply chains”.

Bubs Australia starts strategic review

In the wake of changes to Bubs’ board of directors, the Australia-based group is evaluating its operations.

Credit: @bubsaustralia / Facebook

Bubs Australia, the infant-formula and baby-food maker, has started a strategic review two weeks after announcing a new chair.

The publicly-listed business said it expects to complete the assessment by the end of June.

Bubs Australia revealed the review alongside a sales update for the third quarter of its financial year, a period in which gross revenue fell 10%.


Gross revenue from China fell by 56%. Bubs Australia pointed to “significant amounts of finished goods inventory held in trade”.

China accounts for a fifth of Bubs Australia’s gross revenue. The company has seconded Jackie Lin, an executive at private-equity firm and investor C2 Capital, to manage its business in China and review its options in the country.

Rathie, who was a non-executive director at Bubs Australia, was appointed chair on 6 April.

She replaced Dennis Lin, who had been in the role since August 2017.

In February, Bubs reported a statutory EBITDA loss of A$42m (US$27.7m) for the six months to 31 December, compared to a A$1.2m profit a year earlier. The underlying EBITDA loss was A$22m versus A$1.2m.


Group revenue was down 6% at A$31.5m. Infant-formula revenue, which Bubs Australia describes as the “most profitable portfolio segment”, rose 44% to A$27.9m.

In the third quarter to the end of March this year, group gross revenue was $15.8m, down 10%. Bubs Australia said branded gross revenue increased 26% to $15.1m.

“The period saw continued growth in the USA, with gross revenue up 116% on Q2 and further good progress against securing a permanent regulatory pathway,” Rathie said in a stock-exchange filing today (28 April).

“Expenditure management is an immediate focus of the board, and a strategic review of the global business has commenced.”

In its statement, Bubs Australia said “the short-term outlook for sales to China in Q4 remains subdued” but added: “It is pleasing that the Chinese economy is now fully open for business again. The company will comment further on future prospects once its strategic review is complete.”