TSN 2014 Q3 8K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

Current Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

Date of Report (Date of Earliest Event Reported): July 28, 2014

Tyson Foods, Inc.
(Exact name of Registrant as specified in its charter)

Delaware
(State of incorporation or organization)

001-14704
(Commission File Number)

71-0225165
(IRS Employer Identification No.)

2200 Don Tyson Parkway, Springdale, AR 72762-6999
(479) 290-4000
(Address, including zip code, and telephone number, including area code, of
Registrant’s principal executive offices)

Not applicable
(Former name, former address and former fiscal year, if applicable)

___________________________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
[ ]    Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[ ]    Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[ ]    Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[ ]    Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))




Item 2.02. Results of Operations and Financial Condition

On July 28, 2014, Tyson Foods, Inc. (the "Company") issued a press release announcing its unaudited results of operations for its third quarter ended June 28, 2014. The press release is furnished herewith as Exhibit 99.1 and incorporated by reference herein.

Limitation on Incorporation by Reference
In accordance with general instruction B.2 of Form 8-K, the information in Items 2.02 and 9.01 of this report, including Exhibit 99.1, is furnished pursuant to Items 2.02 and 9.01 and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liability of that section.
Item 8.01. Other Events.
The Company is disclosing under Item 8.01 of this Current Report the information set forth below.
Environmental Matter
On June 17, 2014, the Missouri attorney general filed a civil lawsuit against the Company concerning an incident that occurred in May 2014 in which some feed supplement was discharged from the Company’s plant in Monett, Missouri, to the City of Monett’s wastewater treatment plant allegedly leading to a fish kill in a local stream and odor issues around the plant. That lawsuit alleges six violations stemming from the incident, and seeks penalties against the Company, compensation for damage to the stream, and reimbursement for the State of Missouri’s costs in investigating the matter. The U.S. Environmental Protection Agency has also indicated to the Company that it has begun a criminal investigation into the incident. If the Company becomes subject to criminal charges, it may be subject to a fine and other relief, as well as government contract suspension and debarment. The Company is cooperating with the Environmental Protection Agency but cannot predict the outcome of its investigation at this time. It is also possible that other regulatory agencies may commence investigations and allege additional violations. Finally, the Company may be subject to claims from the City of Monett for causing it to violate various municipal regulations and for damages to the City’s treatment system.
The Company anticipates disclosing the substance of the information set forth in the immediately preceding paragraph in its Quarterly Report on Form 10-Q for the quarterly period ended June 28, 2014 (the “10-Q”). This disclosure is based on information available to the Company as of July 28, 2014, and the disclosure (if any) included in the 10-Q will reflect the information available to the Company as of the date the Company finalizes the 10-Q.
Plan to Improve Prepared Foods Business
On July 25, 2014, the Company announced that, as part of ongoing efforts to improve the performance of its prepared foods business, it plans to discontinue operations at three facilities. The closings will enable the Company to use more of the available production capacity at some of its other prepared foods plants.

The Company’s Cherokee, Iowa, plant will close effective September 27, while the Company’s Buffalo, New York, and Santa Teresa, New Mexico, plants are expected to cease operations during the first half of calendar 2015. The decision will affect approximately 950 people, including 450 at Cherokee, 300 at Buffalo and 200 at Santa Teresa.

The planned closures are due to a combination of factors including changing product needs, the age of the Cherokee facility and prohibitive cost of its renovation and the distance of the Buffalo and Santa Teresa plants from their raw material supply in the Midwest. In addition, the closings will allow the Company to shift some of the production and equipment to other, more cost-efficient Company locations.

Affected workers will be encouraged to apply for openings within the Company and also will be invited to job fairs the Company plans to host. In addition, the Company intends to work with state officials to ensure the employees are informed about unemployment benefits and any potential re-training opportunities.

2


All three plants have been part of the Company since 2001, when the company acquired IBP, inc. The Cherokee plant, which the Company leases, was originally built in 1955 as a hog slaughter plant. It currently makes deli meats, hams, bacon and hot dogs. The Buffalo facility produces hot dogs, sausage and hams. It first opened in 1969 and operated as Russer Foods until 1999, when it was acquired by IBP. Santa Teresa makes a variety of cooked products including dinner meats, diced ham and roast beef. The facility was built by John’s Brothers and opened in the spring of 1982. It became part of IBP in 1994.
Sale of Mexico and Brazil Poultry Businesses
On July 28, 2014, the Company announced that it had reached a definitive agreement to sell its poultry businesses in Mexico and Brazil to JBS SA. The transaction is valued at $575 million (U.S.) and will be paid in cash. The transaction is pending the necessary government approvals in Mexico and Brazil and is expected to be completed by the end of the 2014 calendar year. The sale includes $400 million for Tyson de México and $175 million for Tyson do Brasil. The Company has had a presence in Mexico for 20 years and has owned poultry operations in Brazil since 2008. The Company’s Tyson de México and Tyson do Brasil poultry units generate combined annual sales of approximately $1 billion.
Tyson Foods’ Mexican business will be acquired through Pilgrim’s Pride, whose majority owner is JBS USA Holdings, Inc., a wholly owned subsidiary of JBS SA. The Brazilian business is to be acquired through JBS Foods, also a wholly owned subsidiary of JBS SA.
The Mexican business, known as Tyson de México, is a vertically integrated poultry business based in Gomez Palacio in North Central México. It has three plants and employs more than 5,400 team members in its plants, offices and seven distribution centers.
The acquisition of Tyson’s Brazil operations, known as Tyson do Brasil, involves three fully integrated production plants, two in Santa Catarina and one in the state of Parana. Tyson do Brasil employs 5,000 team members.
Tyson Foods will continue to serve customers in Mexico. The company will supply them with U.S.-produced chicken as well as chicken produced in Mexico, in part through a co-packaging arrangement with Pilgrim’s Pride.
Tyson Foods’ intends to remain focused on growing its poultry operations in Asia, which include three poultry plants in China and majority ownership of two poultry plants in India. Combined, these Asian operations employ approximately 5,000 people.



3



Preliminary Results of Operations for the Quarterly Period Ended June 28, 2014


On July 28, 2014, the Company issued a press release reporting the following preliminary results:

(in millions, except per share data)
Third Quarter
 
Nine Months
 
2014
 
2013
 
2014
 
2013
Sales
$
9,682

 
$
8,731

 
$
27,475

 
$
25,480

Operating Income
351

 
419

 
1,124

 
959

 
 
 
 
 
 
 
 
Income from Continuing Operations
258

 
249

 
720

 
589

Loss from Discontinued Operation, Net of Tax

 
(4
)
 

 
(70
)
Net Income
258

 
245

 
720

 
519

Less: Net Income (Loss) Attributable to Noncontrolling Interests
(2
)
 
(4
)
 
(7
)
 
2

Net Income Attributable to Tyson
$
260

 
$
249

 
$
727

 
$
517

 
 
 
 
 
 
 
 
Adjusted¹ Operating Income from Continuing Operations
$
407

 
$
419

 
$
1,180

 
$
959

 
 
 
 
 
 
 
 
Net Income Per Share from Continuing Operations Attributable to Tyson
$
0.73

 
$
0.69

 
$
2.05

 
$
1.61

Adjusted¹ Net Income Per Share from Continuing Operations Attributable to Tyson
$
0.75

 
$
0.69

 
$
2.07

 
$
1.56

 
 
 
 
 
 
 
 
Net Income Per Share Attributable to Tyson
$
0.73

 
$
0.68

 
$
2.05

 
$
1.42

Adjusted¹ Net Income Per Share Attributable to Tyson
$
0.75

 
$
0.68

 
$
2.07

 
$
1.52


¹Adjusted operating income and adjusted EPS is explained and reconciled to comparable GAAP measure below
Third Quarter Highlights
Reported EPS was $0.73; Adjusted EPS up 9% to $0.75 compared to EPS from continuing operations of $0.69 in third quarter of fiscal 2013
Quarterly sales up to $9.7 billion resulting in 11% increase over third quarter of fiscal 2013
Adjusted operating margin was 4.2%
Acquisition of the Hillshire Brands on track for closing in fourth quarter of fiscal 2014


4


Segment Performance Review (in millions)

Sales
(for the third quarter and nine months ended June 28, 2014, and June 29, 2013)
 
Third Quarter
Nine Months
 
 
 
Volume
Avg. Price
 
 
Volume
Avg. Price
 
2014
2013
Change
Change
2014
2013
Change
Change
Chicken
$
2,829

$
2,820

1.3
 %
(1.0
)%
$
8,327

$
8,148

2.7
%
(0.5
)%
Beef
4,189

3,723

(0.9
)%
13.5
 %
11,748

10,655

0.4
%
9.8
 %
Pork
1,766

1,332

5.0
 %
26.3
 %
4,677

4,006

1.1
%
15.4
 %
Prepared Foods
901

797

4.0
 %
8.7
 %
2,669

2,441

5.2
%
4.0
 %
International
365

343

17.2
 %
(9.2
)%
1,020

1,001

14.0
%
(10.6
)%
Other


n/a

n/a


47

n/a

n/a

Intersegment Sales
(368
)
(284
)
n/a

n/a

(966
)
(818
)
n/a

n/a

Total
$
9,682

$
8,731

2.2
 %
8.5
 %
$
27,475

$
25,480

2.5
%
5.4
 %

Operating Income (Loss)
(for the third quarter and nine months ended June 28, 2014, and June 29, 2013)
 
Third Quarter
Nine Months
 
 
 
Operating Margin
 
 
Operating Margin
 
2014
2013
2014
2013
2014
2013
2014
2013
Chicken
$
195

$
215

6.9
 %
7.6
%
$
682

$
471

8.2
 %
5.8
%
Beef
101

114

2.4
 %
3.1
%
194

134

1.7
 %
1.3
%
Pork
128

67

7.2
 %
5.0
%
356

264

7.6
 %
6.6
%
Prepared Foods
(50
)
24

(5.5
)%
3.0
%
(13
)
85

(0.5
)%
3.5
%
International
(15
)
5

(4.1
)%
1.5
%
(73
)

(7.2
)%
%
Other
(8
)
(6
)
n/a

n/a

(22
)
5

n/a

n/a

Total
$
351

$
419

3.6
 %
4.8
%
$
1,124

$
959

4.1
 %
3.8
%
Note: During the second quarter of fiscal 2014, we began reporting our International operation as a separate segment, which was previously included in our Chicken segment. The International segment includes our foreign operations related to raising and processing live chickens in Brazil, China, India and Mexico. All periods presented have been reclassified to reflect this change.

Third quarter and nine months of fiscal 2014
Operating income was reduced by $49 million in the Prepared Foods segment for impairments related to the closure of three plants.
Operating income was reduced by $7 million in Other for third party transaction fees incurred as part of the Hillshire Brands acquisition.

Chicken - Sales volumes for the third quarter and nine months of fiscal 2014 grew as a result of stronger demand for chicken products and mix of rendered product sales. Average sales price decreased as feed ingredient costs declined, partially offset by mix changes. Operating income for the third quarter of fiscal 2014 was negatively impacted by rapidly rising costs of outside meat purchases as well as operational disruptions at two of our facilities. For the nine months of fiscal 2014, operating income increased due to higher sales volume and lower feed ingredient costs, partially offset by decreased average sales price. Feed costs decreased $120 million and $460 million for the third quarter and nine months of fiscal 2014, respectively.
Beef - Sales volumes decreased for the third quarter of fiscal 2014 due to a reduction in live cattle processed. However, sales volumes were up for the nine months of fiscal 2014 due to better domestic demand for our beef products, partially offset by reduced exports. Average sales price increased due to lower domestic availability of fed cattle supplies, which additionally drove up livestock costs. Operating income decreased for the third quarter of fiscal 2014 due to higher fed cattle costs and periods of reduced demand for beef products, which made it difficult to pass along increased input costs, as well as lower sales volumes and increased operating costs. For the nine months of fiscal 2014, operating income increased due to improved operational execution and maximizing our revenues relative to the rising live cattle markets, partially offset by increased operating costs.

5


Pork - Sales volumes increased as a result of better domestic demand for our pork products. Average sales price increased due to lower total hog supplies, which additionally resulted in higher input costs. Operating income increased as we maximized our revenues relative to live hog markets, partially attributable to operational and mix performance.
Prepared Foods - Sales volumes increased as a result of improved demand for our prepared foods products and incremental volumes from the purchase of three businesses. Average sales price increased due to better product mix and price increases associated with higher input costs. Operating income decreased as a result of higher raw material and other input costs of approximately $95 million and $160 million for the third quarter and nine months of fiscal 2014, respectively, and additional costs incurred as we invested in our growth platforms. Because many of our sales contracts are formula based or shorter-term in nature, we are typically able to offset rising input costs through pricing. However, there is a lag time for price increases to take effect. Additionally, in the third quarter of fiscal 2014, we incurred a $49 million impairment charge related to the planned closure of three plants, which are expected to cease operation by mid-fiscal 2015.
International - Sales volumes increased as we grew our businesses in Brazil and China. Average sales price decreased due to poor export market conditions in Brazil, supply imbalances associated with weak demand in China and a less favorable pricing environment in Mexico. Operating income decreased due to poor operational execution in Brazil, challenging market conditions in Brazil and China and additional costs incurred as we grew our International operation.

6


TYSON FOODS, INC.
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(In millions, except per share data)
(Unaudited)
 
Three Months Ended
 
Nine Months Ended
 
June 28, 2014
 
June 29, 2013
 
June 28, 2014
 
June 29, 2013
Sales
$
9,682

 
$
8,731

 
$
27,475

 
$
25,480

Cost of Sales
9,045

 
8,049

 
25,502

 
23,791

Gross Profit
637

 
682

 
1,973

 
1,689

 
 
 
 
 
 
 
 
Selling, General and Administrative
286

 
263

 
849

 
730

Operating Income
351

 
419

 
1,124

 
959

Other (Income) Expense:
 
 
 
 
 
 
 
Interest income
(1
)
 
(2
)
 
(6
)
 
(5
)
Interest expense
25

 
36

 
78

 
109

Other, net
17

 

 
18

 
(19
)
Total Other (Income) Expense
41

 
34

 
90

 
85

Income from Continuing Operations before Income Taxes
310

 
385

 
1,034

 
874

Income Tax Expense
52

 
136

 
314

 
285

Income from Continuing Operations
258

 
249

 
720

 
589

Loss from Discontinued Operation, Net of Tax

 
(4
)
 

 
(70
)
Net Income
258

 
245

 
720

 
519

Less: Net Income (Loss) Attributable to Noncontrolling Interests
(2
)
 
(4
)
 
(7
)
 
2

Net Income Attributable to Tyson
$
260

 
$
249

 
$
727

 
$
517

Amounts attributable to Tyson:
 
 
 
 
 
 
 
Net Income from Continuing Operations
260

 
253

 
727

 
587

Net Loss from Discontinued Operation

 
(4
)
 

 
(70
)
Net Income Attributable to Tyson
$
260

 
$
249

 
$
727

 
$
517

Weighted Average Shares Outstanding:
 
 
 
 
 
 
 
Class A Basic
280

 
283

 
275

 
284

Class B Basic
70

 
70

 
70

 
70

Diluted
356

 
369

 
355

 
366

Net Income Per Share from Continuing Operations Attributable to Tyson:
 
 
 
 
 
 
Class A Basic
$
0.75

 
$
0.73

 
$
2.15

 
$
1.69

Class B Basic
$
0.68

 
$
0.66

 
$
1.94

 
$
1.52

Diluted
$
0.73

 
$
0.69

 
$
2.05

 
$
1.61

Net Loss Per Share from Discontinued Operation Attributable to Tyson:
 
 
 
 
 
 
Class A Basic
$

 
$
(0.01
)
 
$

 
$
(0.20
)
Class B Basic
$

 
$
(0.02
)
 
$

 
$
(0.18
)
Diluted
$

 
$
(0.01
)
 
$

 
$
(0.19
)
Net Income Per Share Attributable to Tyson:
 
 
 
 
 
 
 
Class A Basic
$
0.75

 
$
0.72

 
$
2.15

 
$
1.49

Class B Basic
$
0.68

 
$
0.64

 
$
1.94

 
$
1.34

Diluted
$
0.73

 
$
0.68

 
$
2.05

 
$
1.42

Dividends Declared Per Share:
 
 
 
 
 
 
 
Class A
$
0.075

 
$
0.050

 
$
0.250

 
$
0.260

Class B
$
0.068

 
$
0.045

 
$
0.226

 
$
0.234

 
 
 
 
 
 
 
 
Sales Growth
10.9
%
 
 
 
7.8
%
 
 
Margins: (Percent of Sales)
 
 
 
 
 
 
 
Gross Profit
6.6
%
 
7.8
%
 
7.2
%
 
6.6
%
Operating Income
3.6
%
 
4.8
%
 
4.1
%
 
3.8
%
Income from Continuing Operations
2.7
%
 
2.9
%
 
2.6
%
 
2.3
%
Effective Tax Rate for Continuing Operations
16.8
%
 
35.4
%
 
30.4
%
 
32.6
%

7


TYSON FOODS, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS
(In millions)
(Unaudited)

 
June 28, 2014
 
September 28, 2013
Assets
 
 
 
Current Assets:
 
 
 
Cash and cash equivalents
$
587

 
$
1,145

Accounts receivable, net
1,624

 
1,497

Inventories
3,061

 
2,817

Other current assets
241

 
145

Total Current Assets
5,513

 
5,604

Net Property, Plant and Equipment
3,941

 
4,053

Goodwill
1,925

 
1,902

Intangible Assets
151

 
138

Other Assets
525

 
480

Total Assets
$
12,055

 
$
12,177

 
 
 
 
Liabilities and Shareholders’ Equity
 
 
 
Current Liabilities:
 
 
 
Current debt
$
41

 
$
513

Accounts payable
1,496

 
1,359

Other current liabilities
1,075

 
1,138

Total Current Liabilities
2,612

 
3,010

Long-Term Debt
1,784

 
1,895

Deferred Income Taxes
404

 
479

Other Liabilities
545

 
560

 
 
 
 
Total Tyson Shareholders’ Equity
6,694

 
6,201

Noncontrolling Interests
16

 
32

Total Shareholders’ Equity
6,710

 
6,233

 
 
 
 
Total Liabilities and Shareholders’ Equity
$
12,055

 
$
12,177


8


TYSON FOODS, INC.
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(In millions)
(Unaudited)

 
Nine Months Ended
 
June 28, 2014
 
June 29, 2013
Cash Flows From Operating Activities:
 
 
 
Net income
$
720

 
$
519

Depreciation and amortization
382

 
387

Deferred income taxes
(64
)
 
(21
)
Convertible debt discount
(92
)
 

Other, net
76

 
80

Net changes in working capital
(479
)
 
(193
)
Cash Provided by Operating Activities
543

 
772

 
 
 
 
Cash Flows From Investing Activities:
 
 
 
Additions to property, plant and equipment
(437
)
 
(425
)
Purchases of marketable securities
(25
)
 
(123
)
Proceeds from sale of marketable securities
24

 
22

Acquisitions, net of cash acquired
(56
)
 
(106
)
Other, net
44

 
36

Cash Used for Investing Activities
(450
)
 
(596
)
 
 
 
 
Cash Flows From Financing Activities:
 
 
 
Payments on debt
(407
)
 
(69
)
Net proceeds from borrowings
28

 
48

Purchases of Tyson Class A common stock
(286
)
 
(298
)
Dividends
(76
)
 
(87
)
Stock options exercised
61

 
93

Other, net
26

 
13

Cash Used for Financing Activities
(654
)
 
(300
)
 
 
 
 
Effect of Exchange Rate Changes on Cash
3

 
(4
)
 
 
 
 
Decrease in Cash and Cash Equivalents
(558
)
 
(128
)
Cash and Cash Equivalents at Beginning of Year
1,145

 
1,071

Cash and Cash Equivalents at End of Period
$
587

 
$
943


9


TYSON FOODS, INC.
EBITDA Reconciliations
(In millions)
(Unaudited)

 
Nine Months Ended
 
Fiscal Year Ended
Twelve Months Ended
 
June 28, 2014
 
June 29, 2013
 
September 28, 2013
June 28, 2014
 
 
 
 
 
 
 
Net income
$
720

 
$
519

 
$
778

$
979

Less: Interest income
(6
)
 
(5
)
 
(7
)
(8
)
Add: Interest expense
78

 
109

 
145

114

Add: Income tax expense (a)
314

 
287

 
409

436

Add: Depreciation
362

 
354

 
474

482

Add: Amortization (b)
15

 
12

 
17

20

EBITDA
$
1,483

 
$
1,276

 
$
1,816

$
2,023

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total gross debt
 
 
 
 
$
2,408

$
1,825

Less: Cash and cash equivalents
 
 
 
 
(1,145
)
(587
)
Less: Short-term investments
 
 
 
 
(1
)
(2
)
Total net debt


 


 
$
1,262

$
1,236

 
 
 
 
 
 
 
Ratio Calculations:
 
 
 
 
 
 
Gross debt/EBITDA


 


 
1.3x

0.9x

Net debt/EBITDA


 


 
0.7x

0.6x


(a)
Includes income tax expense of discontinued operation.
(b)
Excludes the amortization of debt discount expense of $5 million and $21 million for the 9 months ended June 28, 2014, and June 29, 2013, respectively, and $28 million for the fiscal year ended September 28, 2013, as it is included in Interest expense.

EBITDA represents net income, net of interest, income tax and depreciation and amortization. EBITDA is presented as a supplemental financial measurement in the evaluation of our business. We believe the presentation of this financial measure helps investors to assess our operating performance from period to period and enhances understanding of our financial performance and highlights operational trends. This measure is widely used by investors and rating agencies in the valuation, comparison, rating and investment recommendations of companies. However, the measurement of EBITDA may not be comparable to those of other companies in our industry, which limits its usefulness as a comparative measure. EBITDA is not a measure required by or calculated in accordance with GAAP and should not be considered as a substitute for net income or any other measure of financial performance reported in accordance with GAAP or as a measure of operating cash flow or liquidity. EBITDA is a useful tool for assessing, but is not a reliable indicator of, our ability to generate cash to service our debt obligations because certain of the items added to net income to determine EBITDA involve outlays of cash. As a result, actual cash available to service our debt obligations will be different from EBITDA. Investors should rely primarily on our GAAP results, and use non-GAAP financial measures only supplementally, in making investment decisions.


10


TYSON FOODS, INC.
EPS Reconciliations
(Unaudited)

 
Three Months Ended
 
Nine Months Ended
 
June 28, 2014
 
June 29, 2013
 
June 28, 2014
 
June 29, 2013
 
 
 
 
 
 
 
 
Reported net income from continuing operations per share attributable to Tyson
$
0.73

 
$
0.69

 
$
2.05

 
$
1.61

 
 
 
 
 
 
 
 
Less: $19 million recognized currency translation adjustment gain

 

 

 
(0.05
)
 
 
 
 
 
 
 
 
Less: $40 million gain on unrecognized tax benefit
(0.11
)
 

 
(0.11
)
 

 
 
 
 
 
 
 
 
Add: $29 million Hillshire Brands acquisition fees paid to third parties
0.05

 

 
0.05

 

 
 
 
 
 
 
 
 
Add: $49 million impairment due to closure of three facilities
0.08

 

 
0.08

 

 
 
 
 
 
 
 
 
Adjusted net income from continuing operations per share attributable to Tyson
$
0.75

 
$
0.69

 
$
2.07

 
$
1.56

 
 
 
 
 
 
 
 

 
Three Months Ended
 
Nine Months Ended
 
June 28, 2014

 
June 29, 2013

 
June 28, 2014

 
June 29, 2013

 
 
 
 
 
 
 
 
Reported net income per share attributable to Tyson
$
0.73

 
$
0.68

 
$
2.05

 
$
1.42

 
 
 
 
 
 
 
 
Less: $19 million recognized currency translation adjustment gain

 

 

 
(0.05
)
 
 
 
 
 
 
 
 
Add: $56 million impairment of non-core assets in China

 

 

 
0.15

 
 
 
 
 
 
 
 
Less: $40 million gain on unrecognized tax benefit
(0.11
)
 

 
(0.11
)
 

 
 
 
 
 
 
 
 
Add: $29 million Hillshire Brands acquisition fees paid to third parties
0.05

 

 
0.05

 

 
 
 
 
 
 
 
 
Add: $49 million impairment due to closure of three facilities
0.08

 

 
0.08

 

 
 
 
 
 
 
 
 
Adjusted net income per share attributable to Tyson
$
0.75

 
$
0.68

 
$
2.07

 
$
1.52


Adjusted net income per share attributable to Tyson (adjusted EPS) and adjusted net income from continuing operations per share attributable to Tyson (adjusted continuing EPS) are presented as supplementary financial measurements in the evaluation of our business. We believe the presentation of adjusted EPS and adjusted continuing EPS helps investors to assess our financial performance from period to period and enhances understanding of our financial performance. However, adjusted EPS and adjusted continuing EPS may not be comparable to those of other companies in our industry, which limits the usefulness as comparative measures. Adjusted EPS and adjusted continuing EPS are not measures required by or calculated in accordance with GAAP and should not be considered as substitutes for any measure of financial performance reported in accordance with GAAP. Investors should rely primarily on our GAAP results, and use non-GAAP financial measures only supplementally, in making investment decisions.

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TYSON FOODS, INC.
Operating Income Reconciliation
(Unaudited)

 
Three Months Ended
 
Nine Months Ended
 
June 28, 2014
 
June 29, 2013
 
June 28, 2014
 
June 29, 2013
 
 
 
 
 
 
 
 
Reported from continuing operations
$
351

 
$
419

 
$
1,124

 
$
959

 
 
 
 
 
 
 
 
Add: Hillshire Brands acquisition fees paid to third parties
7

 

 
7

 

 
 
 
 
 
 
 
 
Add: Impairment due to closure of three facilities
49

 

 
49

 

 
 
 
 
 
 
 
 
Adjusted from continuing operations
$
407

 
$
419

 
$
1,180

 
$
959

 
 
 
 
 
 
 
 

Adjusted operating income from continuing operations is presented as supplementary financial measurements in the evaluation of our business. We believe the presentation of adjusted operating income helps investors assess our financial performance from period to period and enhance understanding of our financial performance. However, adjusted operating income may not be comparable to those of other companies in our industry, which limits the usefulness as comparative measures. Adjusted operating income is not a measure required by or calculated in accordance with GAAP and should not be considered as a substitute for any measures of financial performance reported in accordance with GAAP. Investors should rely primarily on our GAAP results, and use non-GAAP financial measures only supplementally in making investment decisions.
The preliminary financial data included in this Current Report on Form 8-K has been prepared by and is the responsibility of the Company’s management.  PricewaterhouseCoopers LLP has not audited, reviewed, or compiled or performed any procedures with respect to the accompanying preliminary financial data.  Accordingly, PricewaterhouseCoopers LLP does not express an opinion or any other form of assurance with respect thereto.
Forward-Looking Statements
This Current Report on Form 8-K contains forward-looking statements that are based on the Company’s management’s current expectations. Such forward-looking statements are subject to certain risks, uncertainties and assumptions, including, without limitation, prevailing market conditions and other factors. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those expected. More information about potential risk factors that could affect the Company and its results is included in the Company’s filings with the SEC.

Item 9.01. Financial Statements and Exhibits

(d)
Exhibit

Exhibit
Number
Description
99.1
Press Release, dated July 28, 2014, announcing the unaudited results of operations of Tyson Foods, Inc. for its third quarter ended June 28, 2014



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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 
 
TYSON FOODS, INC.
 
 
 
 
 
 
 
 
Date: July 28, 2014
 
By:
/s/ Dennis Leatherby
 
 
 
 
 
 
Name:
Dennis Leatherby
 
 
Title:
Executive Vice President and
 
 
 
Chief Financial Officer


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