SPRINGDALE, Ark., Feb. 3 /PRNewswire-FirstCall/ -- The temporary
suspension of operations at some Tyson Foods (NYSE: TSN) beef plants will
continue through February 12 and may extend beyond that date, company
officials reported today. As a result, Tyson will pay qualified workers for
another week off the job.
Unfavorable market conditions, including tight cattle supplies, soft
domestic beef demand and the continued absence of key export markets, prompted
Tyson to temporarily suspend operations January 10 in Denison, Iowa; Norfolk
and West Point, Nebraska; and Boise Idaho. Second shift processing at Pasco,
Washington was also temporarily discontinued.
Tyson officials originally expected the temporary suspension to last three
to five weeks; however, based on daily evaluations of current market
conditions they now indicate it will last a full five weeks and possibly
longer. The company will continue to analyze the situation; however, the
decision whether the suspension will go beyond a fifth week will not be made
until sometime next week.
In an effort to retain workers, Tyson has been paying most of the people
who are off work. Qualified Team Members were encouraged to take paid
vacation for the first week operations were suspended. The company has since
been giving them the equivalent of 32 hours of pay each week and will now
extend this pay into a fifth week.
Meetings will be held with affected Team Members at each location on
Monday, February 7, to update them and attempt to answer questions.
"We know how difficult this suspension has been for our Team Members and
our plant communities, however, market conditions have not improved enough to
warrant resuming operations," said John Tyson, chairman and CEO of Tyson
Foods. "We need more cattle to run these plants. The U.S. beef industry is
currently out of balance with far more slaughter capacity than available
cattle. That's why reopening the U.S. border to Canadian cattle is so
important. While we remain optimistic this will happen as scheduled, we're
concerned about attempts to delay it."
As previously reported, approximately 2,100 Team Members are affected by
the temporary suspension. This includes 275 Team Members at Denison, 900 at
Norfolk, 275 at West Point, 250 at Boise and 400 at Pasco.
Tyson Foods, Inc., founded in 1935 with headquarters in Springdale,
Arkansas, is the world's largest processor and marketer of chicken, beef, and
pork and the second-largest food company in the Fortune 500. The company
produces a wide variety of protein-based and prepared food products, which are
marketed under the "Powered by Tyson(TM)" strategy. Tyson is the recognized
market leader in the retail and foodservice markets it serves, providing
products and service to customers throughout the United States and more than
80 countries. Tyson has approximately 114,000 Team Members employed at more
than 300 facilities and offices in the United States and around the world.
Forward-Looking Statements
Certain statements contained in this communication are "forward-looking
statements" such as statements relating to future suspension of operations and
the resumption of cattle imports. These forward-looking statements are
subject to risks, uncertainties and other factors, which could cause actual
results to differ materially from historical experience or from future results
expressed or implied by such forward-looking statements. Among the factors
that may cause actual results to differ materially from those expressed in, or
implied by, the statements are the following: (i) fluctuations in the cost and
availability of raw materials, such as live cattle, live swine or feed grains;
(ii) market conditions for finished products, including the supply and pricing
of alternative proteins, and the demand for alternative proteins; (iii) risks
associated with effectively evaluating derivatives and hedging activities;
(iv) access to foreign markets together with foreign economic conditions,
including currency fluctuations and import/export restrictions; (v) successful
rationalization of existing facilities, and the operating efficiencies of the
facilities; (vi) changes in the availability and relative costs of labor and
contract growers; (vii) issues related to food safety, including costs
resulting from product recalls, regulatory compliance and any related claims
or litigation; (viii) adverse results from litigation; (ix) risks associated
with leverage, including cost increases due to rising interest rates or
changes in debt ratings or outlook; (x) changes in regulations and laws (both
domestic and foreign), including changes in accounting standards,
environmental laws and occupational, health and safety laws; (xi) the ability
of the Company to make effective acquisitions, and successfully integrate
newly acquired businesses into existing operations; (xii) effectiveness of
advertising and marketing programs; and (xiii) the effect of, or changes in,
general economic conditions. The Company wishes to caution readers not to
place undue reliance on any forward-looking statements, which speak only as of
the date made. Tyson undertakes no obligation to publicly update any forward-
looking statements, whether as a result of new information, future events or
otherwise.
SOURCE Tyson Foods, Inc.
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Related links:
http://www.tyson.com
CONTACT:
media, Gary Mickelson, +1-479-290-6111, or
investors, Louis Gottsponer, +1-479-290-4826, both of Tyson
Foods, Inc.
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