BOSTON, Sept. 6 /PRNewswire-FirstCall/ -- Leveraging the size of Tyson
Foods, Inc. (NYSE: TSN) by selling more products across all distribution
channels is among the steps needed to create long-term value for the
company's shareholders, according to Tyson's new Chief Executive Officer.
Richard L. Bond, who was promoted to CEO in May, joined Tyson Chief
Financial Officer Wade Miquelon in a presentation Wednesday at the
Prudential Equity Group's Annual Back-to-School Consumer Conference in
Boston.
Miquelon noted the steps the company has taken in recent months to
return to profitability, including the implementation of approximately $200
million in cost reductions and the consolidation of beef plants. Company
officials believe more than 90% of these annual savings will be fully
delivered in fiscal year 2007. However, both Miquelon and Bond also
acknowledged the importance of going beyond cost savings to grow the
company's top line sales.
"I'm proud of what we've done so far to right the ship, but there is
much more we can do," Bond said. "To thrive, not just survive, we must
respond better and faster ... and we will.
Tyson is the world's largest producer and marketer of chicken, beef and
pork, and an estimated 300 million times every day people around the world
enjoy Tyson products. "We're going to leverage our scale to create
long-term, sustainable shareholder value," said Bond. "One of the ways
we're going to do that is by thinking across channels, across customers and
across proteins." Examples include the possibility of selling some new food
service products to club stores or marketing a product originally developed
for school cafeterias to retailers.
Bond highlighted the ongoing efforts of the company's commodity,
foodservice, consumer products and international distribution channels.
"We see ourselves as a value-added food company with a commodity base,
and we think this works to our advantage because we can internalize raw
materials for our further-processed products," Bond said. For example, 70%
of the company's mix of poultry products is value-added with such items as
chicken nuggets, breaded strips and hot wings.
"The commodity side of our business needs to be cost efficient and cost
conscious at all times," he added. "We recognize we compete on price in
this business. We probably won't always be the lowest price, but we need to
be close."
Tyson is the leading supplier of protein to the foodservice business.
For example, Tyson products are used by thousands of schools across the
country, including 95 of the 100 largest districts. The company is also one
of the largest makers of pizza crusts and flour and corn tortillas in the
U.S.
In an effort to remain at the forefront of product development for
foodservice and other customers, Tyson is preparing to open a new research,
development and training complex in early 2007 called "The Discovery
Center." This new complex at the company's headquarters in Springdale,
Arkansas, will include a building that will house 18 test kitchens. In
addition, a USDA- inspected pilot plant is being built to provide a
manufacturing environment for product development and new concepts to
improve "speed to market."
Product development is also a highlight of Tyson's consumer products
channel. Earlier this year the company launched 100% All Natural Marinated
Fresh Chicken, which contains no artificial ingredients. Tyson has also
started producing Certified Angus Beef(R) brand Natural beef and Star
Ranch(TM) Natural Angus Beef for retail and foodservice customers. In
addition, the company is offering consumers two new convenience driven
product lines. They include Trimmed and Ready (TM) fresh chicken, which is
hand trimmed and ready to cook, as well as individually wrapped, boneless
chicken breasts for consumers who choose to freeze some of the product for
later use. This fall the company is testing a Tyson branded package for
rotisserie chicken.
Tyson has also been promoting chicken and steak strips with bagged
salads, since 44% of people who buy such meat items put them in salads.
Tyson pre- cooked bacon also continues to increase in popularity and won
the American Culinary ChefsBest(TM) taste award this year. It was judged
the best tasting bacon in the fully-cooked category. (The ChefsBest(TM)
Award is given to the brand rated highest overall among leading brands by
independent professional chefs).
International sales remain extremely important to Tyson Foods, which
sells to 80 countries around the world. According to Bond, the company is
making progress on a small, strategic acquisition in China and also
continues to look at the possible purchase of poultry operations in South
America.
Bond also noted the recent addition of several new senior executives to
Tyson Foods. New CFO Wade Miquelon joined the company three months ago
after working for 16 years at The Procter & Gamble Company (P&G), where he
most recently served as Finance Chief and General Manager for P&G's Western
Europe region. As part of the transition of leadership at Tyson, Miquelon
now reports directly to Bond.
Rick Greubel joined Tyson in August as Group Vice President of
International and will oversee all of the company's international sales and
operations. He was previously employed by Monsanto, where he was President,
Managing Director and Commercial Acceptance Lead for Monsanto Brazil.
Rob DeMartini joins this month as Group Vice President, Consumer
Products, overseeing operations, marketing and sales for all divisions
within Tyson's Consumer Products business, including Deli, Processed Meats,
Wholesale Clubs and Retail. He comes to Tyson Foods from The Gillette
Company, where he was Senior Vice President and General Manager of the
company's $2.2 billion Grooming Division.
Tyson Foods, Inc. [NYSE: TSN], founded in 1935 with headquarters in
Springdale, Arkansas, is the world's largest processor and marketer of
chicken, beef, and pork, the second-largest food company in the Fortune 500
and a member of the S&P 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. The company has approximately 110,000 Team Members employed at
more than 300 facilities and offices in the United States and around the
world. Through its Core Values, Code of Conduct and Team Member Bill of
Rights, Tyson strives to operate with integrity and trust and is committed
to creating value for its shareholders, customers and Team Members. The
company also strives to be faith-friendly, provide a safe work environment
and serve as stewards of the animals, land and environment entrusted to it.
Forward-Looking Statements
Certain information contained in the press release may constitute
forward- looking statements, such as statements relating to implementing
cost savings initiatives and the opening of the "Discovery Center." These
forward-looking statements are subject to a number of factors and
uncertainties which could cause the company's actual results and
experiences to differ materially from the anticipated results and
expectations, expressed in such forward-looking statements. The company
wishes to caution readers not to place undue reliance on any
forward-looking statements, which speak only as of the date made. Among the
factors that may cause actual results and experiences to differ from the
anticipated results and expectations expressed in such forward-looking
statements are the following: (i) fluctuations in the cost and availability
of inputs and raw materials, such as live cattle, live swine, or feed
grains, and energy; (ii) the company's ability to realize anticipated
savings from its cost reduction initiatives; (iii) market conditions for
finished products, including competition from other global and domestic
food processors, the supply and pricing of alternative proteins, and the
demand for alternative proteins; (iv) risks associated with effectively
evaluating derivatives and hedging activities; (v) access to foreign
markets together with foreign economic conditions, including currency
fluctuations, and import/export restrictions and foreign politics; (vi)
outbreak of a livestock disease (such as avian influenza (AI) or bovine
spongiform encephalopathy (BSE)) which could have an effect on livestock
owned by the company, the availability of livestock for purchase by the
company, consumer perception of certain protein products or the company's
ability to access certain domestic and foreign markets; (vii) successful
rationalization of existing facilities, and the operating efficiencies of
the facilities; (viii) changes in the availability and relative costs of
labor and contract growers, and the ability of the company to maintain good
relationships with employees, labor unions, contract growers and
independent producers providing livestock to the company; (ix) issues
related to food safety, including costs resulting from product recalls,
regulatory compliance and any related claims or litigation; (x) changes in
consumer preference and diets, and the company's ability to identify and
react to consumer trends; (xi) significant marketing plan changes by large
customers, or the loss of one or more large customers; (xii) adverse
results from litigation; (xiii) risks associated with leverage, including
cost increases due to rising interest rates or changes in debt ratings or
outlook; (xiv) changes in regulations and laws (both domestic and foreign),
including changes in accounting standards, tax laws, environmental laws and
occupational, health and safety laws; (xv) the ability of the company to
make effective acquisitions and successfully integrate newly acquired
businesses into existing operations; (xvi) effectiveness of advertising and
marketing programs; and (xvii) the effect of, or changes in, general
economic conditions.
SOURCE Tyson Foods, Inc.
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Related links:
http://www.tyson.com
CONTACT:
media, Gary Mickelson, +1-479-290-6111, or
investors, Ruth Ann Wisener, +1-479-290-4235, both of Tyson
Foods, Inc.
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