Tyson Foods’ shares soared nearly 10 percent after it released its earnings report for its fiscal year, driven by record sales and earnings and its purchase of Hillshire Brands.
Donnie Smith, Tyson’s President and CEO, was pleased with the results and was confident that the team would be able to carry this momentum into fiscal 2016.
“The team has been performing at a high level since the merger, but I still see so much potential as the power of Tyson 2.0 is just beginning to emerge,” he said in a press release. “We’re expecting another record year in fiscal 2016.”
Tyson completed its acquisition of Hillshire last year for $8.5 billion. The integration of the companies is expected to generate synergy savings of $255 million in fiscal 2015 and more than $500 million by fiscal 2017.
Prior to Tyson’s glowing earnings report, the company announced that it would shut down operations at two of its plants to improve the overall performance of its prepared foods business. The facilities closing include its pepperoni plant in Jefferson, Wisconsin and the Chicago, Illinois facility, which makes prepared foods for the hospitality industry. Both are expected to close during the second half of Tyson’s fiscal year 2016, which ends October 1, 2016. The decision will affect approximately 880 people, including about 480 at Chicago and about 400 at Jefferson, according to a press release.
Though beef went through a tough operating environment for most of fiscal 2015, Tyson’s prepared foods, chicken, and pork segments produced solid results. Total sales grew 4% to $10.51 billion. Analysts had expected revenue of $10.27 billion, according to Reuters.
For Tyson’s fourth quarter, Tyson reported that its adjusted operating income went up 21% to $568 million and its adjusted operating margin was at a record 5.8%.
Highlights for Tyson’s fiscal 2015 include:
Stick to DeliMarket News for more on Tyson Foods in fiscal 2016 and beyond.