Financial Data and Key Metrics Changes - In Q4, total company sales grew 4.8% to $13.9 billion compared to the prior year, with full-year sales at $54.4 billion, an increase of 3.3% [22][23] - Adjusted operating income for Q4 was $608 million, up 19% year-over-year, while full-year adjusted operating income reached $2.3 billion, a 26% increase [22][23] - Adjusted earnings per share for Q4 were $1.15, up 25% from last year, and full-year adjusted EPS was $4.12, up 33% [23] Business Line Data and Key Metrics Changes - The chicken segment delivered $457 million in adjusted operating income, a 28% increase year-over-year, driven by higher volumes and better operational execution [6][16] - Prepared foods saw a 3% increase in sales, with adjusted operating income affected by higher raw material costs, achieving a margin of 7.4% [14][15] - The beef segment's adjusted operating income declined due to higher cattle costs, while pork adjusted operating income increased by 63% [18][19] Market Data and Key Metrics Changes - Tyson's retail branded products grew by 2.4% in volume, outperforming the broader food and beverage retail sector, which declined by 1.5% [9][10] - The company’s branded fresh chicken volume grew 7.8%, and frozen value-added chicken rose by 8.7% [10][11] - Tyson branded products now reach nearly 72% of U.S. households, exceeding private label and other branded competitors [10] Company Strategy and Development Direction - The company is focused on innovation and operational efficiencies to capture market share and improve profitability across all segments [7][12] - Tyson aims to enhance its product mix by developing more value-added products and improving operational efficiencies [7][18] - The company is committed to removing certain ingredients from its products to meet consumer demand for healthier options [12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the chicken segment benefiting from changing consumer preferences and expects continued growth in 2026 [8][36] - The beef segment faces challenges due to tight cattle supplies and market headwinds, but management is focused on efficiency and innovation to strengthen fundamentals [8][17] - Overall, management remains optimistic about the company's diverse portfolio and ability to navigate market challenges while delivering shareholder value [29] Other Important Information - The company ended the year with $3.7 billion in liquidity and net leverage at 2.1 times, reflecting disciplined capital allocation [23][24] - Free cash flow for the year was $1.2 billion, well ahead of dividends paid [23][24] - The company anticipates full-year sales growth of 2%-4% for 2026, with adjusted operating income expected between $2.1 billion and $2.3 billion [25][26] Q&A Session Summary Question: Guidance on chicken segment for 2026 - Management indicated that the chicken segment is expected to perform well, with a guidance range of $1.25 billion to $1.5 billion for adjusted operating income, based on stable grain prices and strong execution [32][33] Question: Prepared foods performance and input costs - Management acknowledged that the prepared foods segment faced challenges due to rising commodity costs, but they expect improvements in 2026 driven by operational excellence and innovation [37][39] Question: Beef segment outlook amidst cattle supply issues - Management discussed the challenges in the beef segment due to heifer retention and cattle supply constraints, guiding for a potential loss in adjusted operating income between $600 million and $400 million [46][47] Question: CAPEX guidance for 2026 - Management provided a CAPEX range of $700 million to $1 billion for 2026, reflecting the pacing of current projects and timing of new initiatives [48][50] Question: Consumer behavior and SNAP benefits impact - Management noted that while consumer spending patterns are changing, they feel resilient due to their diverse product portfolio and strong brand loyalty [68][71]

Summary of Tyson Foods (TSN) FY Conference Call - May 14, 2025 Company Overview - **Company**: Tyson Foods (TSN) - **Event**: FY Conference Call - **Date**: May 14, 2025 Key Industry Insights - The conference focused on the food value chain, including sectors such as agribusiness, protein, food, beverage, distribution, and food retail [2][3] - Tyson Foods has been a consistent participant in this conference for twenty consecutive years, highlighting its significance in the industry [4] Core Company Performance - **Chicken Business**: - Achieved approximately $680 million in adjusted operating income in the first half of the year [6][16] - Expected to maintain strong performance with guidance for the year set between $1 billion to $1.3 billion [16][18] - Focus on value-added products rather than commodity markets, leading to improved margins [9][10] - Continued investment in brand health and product innovation for future growth [7][11] - **Prepared Foods**: - Recorded about $900 million in adjusted operating income in 2024, with expectations for further growth in 2025 [35][38] - Emphasis on operational excellence and innovation pipeline, aiming for significant improvements in efficiency and profitability [39][40] - Plans to regain food service volume and private label business, enhancing overall market presence [44] - **Beef Business**: - Facing challenges with herd rebuilding, but optimistic about future recovery based on USDA data indicating a decrease in cattle harvest [50][51] - Expected losses in the beef segment for 2025 estimated between $200 million to $400 million [18][58] - Focus on controlling costs and enhancing value-added products to mitigate challenges [52] - **Pork and International**: - Pork business showed a reduction in controllable costs by approximately 18% in Q2, indicating operational improvements [60] - International operations are focused on capacity utilization and filling assets in key markets like China and Thailand [62] Financial Management and Capital Allocation - Tyson Foods has maintained a disciplined approach to cash management, with a target leverage ratio of 2x [65][66] - Capital expenditures are projected between $1 billion and $1.2 billion, reflecting a healthy reinvestment rate [66] - The company raised its dividend for the thirteenth consecutive year, reaching $2 per share [67] Strategic Outlook - Tyson Foods aims to enhance its branded portfolio and innovation pipeline, particularly in prepared foods and value-added chicken products [68] - Share repurchases are considered part of the capital allocation strategy, contingent on market conditions and dilution coverage [69] Additional Considerations - The company is navigating a complex environment with strong demand for chicken and challenges in beef production, which may impact overall profitability [28][49] - Continuous improvement in operational efficiency is a key focus across all segments to drive future growth [48]