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|
(X)
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
|
|
EXCHANGE ACT OF 1934
|
|
|
For the quarterly period ended
April 3, 2010
|
|
|
OR
|
|
|
( )
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
|
|
EXCHANGE ACT OF 1934
|
|
|
Delaware
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71-0225165
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|
(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
|
|
2200 Don Tyson Parkway, Springdale, Arkansas
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72762-6999
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(Address of principal executive offices)
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(Zip Code)
|
|
(479) 290-4000
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|
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(Registrant’s telephone number, including area code)
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|
|
Large accelerated filer [X]
|
Accelerated filer [ ]
|
||
|
Non-accelerated filer [ ] (Do not check if a smaller reporting company)
|
Smaller reporting company [ ]
|
|
Class
|
Outstanding Shares
|
|
Class A Common Stock, $0.10 Par Value (Class A stock)
|
306,947,285
|
|
Class B Common Stock, $0.10 Par Value (Class B stock)
|
70,021,155
|
|
TYSON FOODS, INC.
|
||
|
INDEX
|
||
|
PART I. FINANCIAL INFORMATION
|
||
|
Item 1.
|
Financial Statements
|
PAGE
|
|
Consolidated Condensed Statements of Income
for the Three and Six Months Ended
April 3, 2010, and March 28, 2009
|
3
|
|
|
Consolidated Condensed Balance Sheets
April 3, 2010, and October 3, 2009
|
4
|
|
|
Consolidated Condensed Statements of Cash Flows
for the Six Months Ended
April 3, 2010, and March 28, 2009
|
5
|
|
|
Notes to Consolidated Condensed Financial Statements
|
6
|
|
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
34
|
|
Item 3.
|
Quantitative and Qualitative Disclosures About Market Risk
|
45
|
|
Item 4.
|
Controls and Procedures
|
46
|
|
PART II. OTHER INFORMATION
|
||
|
Item 1.
|
Legal Proceedings
|
47
|
|
Item 1A.
|
Risk Factors
|
48
|
|
Item 2.
|
Unregistered Sales of Equity Securities and Use of Proceeds
|
48
|
|
Item 3.
|
Defaults Upon Senior Securities
|
48
|
|
Item 4.
|
Removed and Reserved
|
48
|
|
Item 5.
|
Other Information
|
48
|
|
Item 6.
|
Exhibits
|
50
|
|
SIGNATURES
|
50
|
|
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
|
April 3, 2010
|
March 28, 2009
|
April 3, 2010
|
March 28, 2009
|
|||||||||||||
|
Sales
|
$ | 6,916 | $ | 6,307 | $ | 13,551 | $ | 12,828 | ||||||||
|
Cost of Sales
|
6,352 | 6,054 | 12,458 | 12,557 | ||||||||||||
| 564 | 253 | 1,093 | 271 | |||||||||||||
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Selling, General and Administrative
|
220 | 209 | 435 | 425 | ||||||||||||
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Other Charges
|
- | 15 | - | 15 | ||||||||||||
|
Operating Income (Loss)
|
344 | 29 | 658 | (169 | ) | |||||||||||
|
Other (Income) Expense:
|
||||||||||||||||
|
Interest income
|
(4 | ) | (5 | ) | (7 | ) | (9 | ) | ||||||||
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Interest expense
|
100 | 78 | 180 | 145 | ||||||||||||
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Other, net
|
(1 | ) | 3 | - | 21 | |||||||||||
| 95 | 76 | 173 | 157 | |||||||||||||
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Income (Loss) from Continuing Operations before Income Taxes
|
249 | (47 | ) | 485 | (326 | ) | ||||||||||
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Income Tax Expense (Benefit)
|
93 | 58 | 170 | (111 | ) | |||||||||||
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Income (Loss) from Continuing Operations
|
156 | (105 | ) | 315 | (215 | ) | ||||||||||
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Loss from Discontinued Operation, net of tax
|
- | (14 | ) | - | (8 | ) | ||||||||||
|
Net Income (Loss)
|
156 | (119 | ) | 315 | (223 | ) | ||||||||||
|
Less: Net Loss Attributable to Noncontrolling Interest
|
(3 | ) | - | (4 | ) | (2 | ) | |||||||||
|
Net Income (Loss) Attributable to Tyson
|
$ | 159 | $ | (119 | ) | $ | 319 | $ | (221 | ) | ||||||
|
Weighted Average Shares Outstanding:
|
||||||||||||||||
|
Class A Basic
|
303 | 303 | 303 | 303 | ||||||||||||
|
Class B Basic
|
70 | 70 | 70 | 70 | ||||||||||||
|
Diluted
|
378 | 373 | 377 | 373 | ||||||||||||
|
Earnings (Loss) Per Share from Continuing Operations Attributable to Tyson:
|
||||||||||||||||
|
Class A Basic
|
$ | 0.43 | $ | (0.29 | ) | $ | 0.87 | $ | (0.58 | ) | ||||||
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Class B Basic
|
$ | 0.39 | $ | (0.26 | ) | $ | 0.78 | $ | (0.53 | ) | ||||||
|
Diluted
|
$ | 0.42 | $ | (0.28 | ) | $ | 0.84 | $ | (0.57 | ) | ||||||
|
Loss Per Share from Discontinued Operation Attributable to Tyson:
|
||||||||||||||||
|
Class A Basic
|
$ | - | $ | (0.04 | ) | $ | - | $ | (0.02 | ) | ||||||
|
Class B Basic
|
$ | - | $ | (0.04 | ) | $ | - | $ | (0.02 | ) | ||||||
|
Diluted
|
$ | - | $ | (0.04 | ) | $ | - | $ | (0.02 | ) | ||||||
|
Net Income (Loss) Per Share Attributable to Tyson:
|
||||||||||||||||
|
Class A Basic
|
$ | 0.43 | $ | (0.33 | ) | $ | 0.87 | $ | (0.60 | ) | ||||||
|
Class B Basic
|
$ | 0.39 | $ | (0.30 | ) | $ | 0.78 | $ | (0.55 | ) | ||||||
|
Diluted
|
$ | 0.42 | $ | (0.32 | ) | $ | 0.84 | $ | (0.59 | ) | ||||||
|
Cash Dividends Per Share:
|
||||||||||||||||
|
Class A
|
$ | 0.040 | $ | 0.040 | $ | 0.080 | $ | 0.080 | ||||||||
|
Class B
|
$ | 0.036 | $ | 0.036 | $ | 0.072 | $ | 0.072 | ||||||||
|
See accompanying Notes to Consolidated Condensed Financial Statements.
|
||||||||||||||||
|
April 3, 2010
|
October 3, 2009
|
|||||||
|
Assets
|
||||||||
|
Current Assets:
|
||||||||
|
Cash and cash equivalents
|
$ | 812 | $ | 1,004 | ||||
|
Restricted cash
|
- | 140 | ||||||
|
Accounts receivable, net
|
1,125 | 1,100 | ||||||
|
Inventories, net
|
2,112 | 2,009 | ||||||
|
Other current assets
|
180 | 122 | ||||||
|
Total Current Assets
|
4,229 | 4,375 | ||||||
|
Restricted Cash
|
- | 43 | ||||||
|
Net Property, Plant and Equipment
|
3,628 | 3,576 | ||||||
|
Goodwill
|
1,918 | 1,917 | ||||||
|
Intangible Assets
|
176 | 187 | ||||||
|
Other Assets
|
460 | 497 | ||||||
|
Total Assets
|
$ | 10,411 | $ | 10,595 | ||||
|
Liabilities and Shareholders’ Equity
|
||||||||
|
Current Liabilities:
|
||||||||
|
Current debt
|
$ | 90 | $ | 219 | ||||
|
Trade accounts payable
|
963 | 1,013 | ||||||
|
Other current liabilities
|
864 | 761 | ||||||
|
Total Current Liabilities
|
1,917 | 1,993 | ||||||
|
Long-Term Debt
|
2,889 | 3,258 | ||||||
|
Deferred Income Taxes
|
309 | 309 | ||||||
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Other Liabilities
|
508 | 539 | ||||||
|
Redeemable Noncontrolling Interest
|
65 | 65 | ||||||
|
Shareholders’ Equity:
|
||||||||
|
Common stock ($0.10 par value):
|
||||||||
|
Class A-authorized 900 million shares, issued 322 million shares
|
32 | 32 | ||||||
|
Convertible Class B-authorized 900 million shares, issued 70 million shares
|
7 | 7 | ||||||
|
Capital in excess of par value
|
2,227 | 2,236 | ||||||
|
Retained earnings
|
2,685 | 2,399 | ||||||
|
Accumulated other comprehensive loss
|
(27 | ) | (34 | ) | ||||
| 4,924 | 4,640 | |||||||
|
Less treasury stock, at cost – 15 million shares at April 3, 2010,
|
||||||||
|
and 16 million shares at October 3, 2009
|
231 | 242 | ||||||
|
Total Tyson Shareholders’ Equity
|
4,693 | 4,398 | ||||||
|
Noncontrolling Interest
|
30 | 33 | ||||||
|
Total Shareholders’ Equity
|
4,723 | 4,431 | ||||||
|
Total Liabilities and Shareholders’ Equity
|
$ | 10,411 | $ | 10,595 | ||||
|
See accompanying Notes to Consolidated Condensed Financial Statements.
|
||||||||
|
Six Months Ended
|
||||||||
|
April 3, 2010
|
March 28, 2009
|
|||||||
|
Cash Flows From Operating Activities:
|
||||||||
|
Net income (loss)
|
$ | 315 | $ | (223 | ) | |||
|
Depreciation and amortization
|
247 | 253 | ||||||
|
Deferred income taxes
|
1 | (78 | ) | |||||
|
Other, net
|
47 | 88 | ||||||
|
Net changes in working capital
|
(111 | ) | 367 | |||||
|
Cash Provided by Operating Activities
|
499 | 407 | ||||||
|
Cash Flows From Investing Activities:
|
||||||||
|
Additions to property, plant and equipment
|
(264 | ) | (160 | ) | ||||
|
Change in restricted cash to be used for investing activities
|
43 | (76 | ) | |||||
|
Proceeds from sale of marketable securities
|
22 | 25 | ||||||
|
Purchases of marketable securities
|
(26 | ) | (13 | ) | ||||
|
Proceeds from sale of discontinued operation
|
- | 43 | ||||||
|
Acquisitions, net of cash acquired
|
- | (76 | ) | |||||
|
Other, net
|
(2 | ) | 20 | |||||
|
Cash Used for Investing Activities
|
(227 | ) | (237 | ) | ||||
|
Cash Flows From Financing Activities:
|
||||||||
|
Net payments on revolving credit facilities
|
- | (2 | ) | |||||
|
Payments on debt
|
(555 | ) | (51 | ) | ||||
|
Proceeds from borrowings of debt
|
15 | 851 | ||||||
|
Debt issuance costs
|
- | (58 | ) | |||||
|
Change in restricted cash to be used for financing activities
|
140 | (234 | ) | |||||
|
Purchases of treasury shares
|
(31 | ) | (4 | ) | ||||
|
Dividends
|
(30 | ) | (30 | ) | ||||
|
Change in negative book cash balances
|
(13 | ) | (90 | ) | ||||
|
Stock options exercised and other, net
|
15 | 4 | ||||||
|
Cash Provided by (Used for) Financing Activities
|
(459 | ) | 386 | |||||
|
Effect of Exchange Rate Change on Cash
|
(5 | ) | 11 | |||||
|
Increase (Decrease) in Cash and Cash Equivalents
|
(192 | ) | 567 | |||||
|
Cash and Cash Equivalents at Beginning of Year
|
1,004 | 250 | ||||||
|
Cash and Cash Equivalents at End of Period
|
$ | 812 | $ | 817 | ||||
|
See accompanying Notes to Consolidated Condensed Financial Statements.
|
||||||||
|
Adjustments:
|
Adjustments:
|
|||||||||||||||
|
Previously
|
Convertible
|
Noncontrolling
|
As
|
|||||||||||||
|
Reported
|
Debt
|
Interest
|
Adjusted
|
|||||||||||||
|
October 3, 2009 Balance Sheet:
|
||||||||||||||||
|
Long-Term Debt
|
$ | 3,333 | $ | (75 | ) | $ | - | $ | 3,258 | |||||||
|
Deferred Income Taxes
|
280 | 29 | - | 309 | ||||||||||||
|
Minority Interest
|
98 | - | (98 | ) | - | |||||||||||
|
Redeemable Noncontrolling Interest
|
- | - | 65 | 65 | ||||||||||||
|
Capital in Excess of Par Value
|
2,180 | 56 | - | 2,236 | ||||||||||||
|
Retained Earnings
|
2,409 | (10 | ) | - | 2,399 | |||||||||||
|
Total Tyson Shareholders’ Equity
|
4,352 | 46 | - | 4,398 | ||||||||||||
|
Noncontrolling Interest
|
- | - | 33 | 33 | ||||||||||||
|
Total Shareholders’ Equity
|
4,352 | 46 | 33 | 4,431 | ||||||||||||
|
Three Months Ended March 28, 2009 – Income Statement:
|
||||||||||||||||
|
Interest Expense
|
$ | 74 | $ | 4 | $ | - | $ | 78 | ||||||||
|
Income (Loss) from Continuing Operations before Income Taxes
|
(43 | ) | (4 | ) | - | (47 | ) | |||||||||
|
Income Tax Expense (Benefit)
|
47 | 11 | - | 58 | ||||||||||||
|
Income (Loss) from Continuing Operations
|
(90 | ) | (15 | ) | - | (105 | ) | |||||||||
|
Minority Interest
|
- | - | - | - | ||||||||||||
|
Net Income (Loss)
|
(104 | ) | (15 | ) | - | (119 | ) | |||||||||
|
Less: Net Loss Attributable to Noncontrolling Interest
|
- | - | - | - | ||||||||||||
|
Net Income (Loss) Attributable to Tyson
|
- | - | - | (119 | ) | |||||||||||
|
Earnings (Loss) Per Share from Continuing Operations Attributable to Tyson:
|
||||||||||||||||
|
Class A Basic
|
$ | (0.25 | ) | $ | (0.04 | ) | $ | - | $ | (0.29 | ) | |||||
|
Class B Basic
|
$ | (0.22 | ) | $ | (0.04 | ) | $ | - | $ | (0.26 | ) | |||||
|
Diluted
|
$ | (0.24 | ) | $ | (0.04 | ) | $ | - | $ | (0.28 | ) | |||||
|
Net Income (Loss) Per Share Attributable to Tyson:
|
||||||||||||||||
|
Class A Basic
|
$ | (0.29 | ) | $ | (0.04 | ) | $ | - | $ | (0.33 | ) | |||||
|
Class B Basic
|
$ | (0.26 | ) | $ | (0.04 | ) | $ | - | $ | (0.30 | ) | |||||
|
Diluted
|
$ | (0.28 | ) | $ | (0.04 | ) | $ | - | $ | (0.32 | ) | |||||
|
Adjustments:
|
Adjustments:
|
|||||||||||||||
|
Previously
|
Convertible
|
Noncontrolling
|
As
|
|||||||||||||
|
Reported
|
Debt
|
Interest
|
Adjusted
|
|||||||||||||
|
Six Months Ended March 28, 2009 – Income Statement:
|
||||||||||||||||
|
Interest Expense
|
$ | 137 | $ | 8 | $ | - | $ | 145 | ||||||||
|
Income (Loss) from Continuing Operations before Income Taxes
|
(318 | ) | (8 | ) | - | (326 | ) | |||||||||
|
Income Tax Expense (Benefit)
|
(108 | ) | (3 | ) | - | (111 | ) | |||||||||
|
Income (Loss) from Continuing Operations
|
(210 | ) | (5 | ) | - | (215 | ) | |||||||||
|
Minority Interest
|
(2 | ) | - | 2 | - | |||||||||||
|
Net Income (Loss)
|
(216 | ) | (5 | ) | (2 | ) | (223 | ) | ||||||||
|
Less: Net Loss Attributable to Noncontrolling Interest
|
- | - | (2 | ) | (2 | ) | ||||||||||
|
Net Income (Loss) Attributable to Tyson
|
- | - | - | (221 | ) | |||||||||||
|
Earnings (Loss) Per Share from Continuing Operations Attributable to Tyson:
|
||||||||||||||||
|
Class A Basic
|
$ | (0.57 | ) | $ | (0.01 | ) | $ | - | $ | (0.58 | ) | |||||
|
Class B Basic
|
$ | (0.51 | ) | $ | (0.02 | ) | $ | - | $ | (0.53 | ) | |||||
|
Diluted
|
$ | (0.56 | ) | $ | (0.01 | ) | $ | - | $ | (0.57 | ) | |||||
|
Net Income (Loss) Per Share Attributable to Tyson:
|
||||||||||||||||
|
Class A Basic
|
$ | (0.59 | ) | $ | (0.01 | ) | $ | - | $ | (0.60 | ) | |||||
|
Class B Basic
|
$ | (0.53 | ) | $ | (0.02 | ) | $ | - | $ | (0.55 | ) | |||||
|
Diluted
|
$ | (0.58 | ) | $ | (0.01 | ) | $ | - | $ | (0.59 | ) | |||||
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
|
April 3, 2010
|
March 28, 2009
|
April 3, 2010
|
March 28, 2009
|
|||||||||||||
|
Sales
|
$ | - | $ | 210 | $ | - | $ | 461 | ||||||||
|
Pretax income from discontinued operation
|
$ | - | $ | 1 | $ | - | $ | 11 | ||||||||
|
Loss on sale of discontinued operation
|
- | (10 | ) | - | (10 | ) | ||||||||||
|
Income tax expense
|
- | 5 | - | 9 | ||||||||||||
|
Loss from discontinued operation
|
$ | - | $ | (14 | ) | $ | - | (8 | ) | |||||||
|
●
|
Cash Flow Hedges – include certain commodity forward contracts of forecasted purchases (i.e., grains) and certain foreign exchange forward contracts.
|
|
|
●
|
Fair Value Hedges – include certain commodity forward contracts of forecasted purchases (i.e., livestock).
|
|
|
●
|
Net Investment Hedges – include certain foreign currency forward contracts of permanently invested capital in certain foreign subsidiaries.
|
|
Metric
|
April 3, 2010
|
October 3, 2009
|
|
|
Commodity:
|
|||
|
Corn
|
Bushels
|
10 million
|
4 million
|
|
Soy meal
|
Tons
|
77,900
|
16,900
|
|
Gain/(Loss)
|
Consolidated Condensed
|
Gain/(Loss)
|
|||||||||||||||
|
Recognized in OCI
|
Statements of Income
|
Reclassified from
|
|||||||||||||||
|
On Derivatives
|
Classification
|
OCI to Earnings
|
|||||||||||||||
|
Three Months Ended
|
Three Months Ended
|
||||||||||||||||
|
April 3, 2010
|
March 28, 2009
|
April 3, 2010
|
March 28, 2009
|
||||||||||||||
|
Cash Flow Hedge – Derivatives
|
|||||||||||||||||
|
designated as hedging instruments:
|
|||||||||||||||||
|
Commodity contracts
|
$ | (7 | ) | $ | (4 | ) |
Cost of Sales
|
$ | 1 | $ | (11 | ) | |||||
|
Foreign exchange contracts
|
- | (1 | ) |
Other Income/Expense
|
- | - | |||||||||||
|
Total
|
$ | (7 | ) | $ | (5 | ) | $ | 1 | $ | (11 | ) | ||||||
|
Gain/(Loss)
|
Consolidated Condensed
|
Gain/(Loss)
|
|||||||||||||||
|
Recognized in OCI
|
Statements of Income
|
Reclassified from
|
|||||||||||||||
|
On Derivatives
|
Classification
|
OCI to Earnings
|
|||||||||||||||
|
Six Months Ended
|
Six Months Ended
|
||||||||||||||||
|
April 3, 2010
|
March 28, 2009
|
April 3, 2010
|
March 28, 2009
|
||||||||||||||
|
Cash Flow Hedge – Derivatives
|
|||||||||||||||||
|
designated as hedging instruments:
|
|||||||||||||||||
|
Commodity contracts
|
$ | (5 | ) | $ | (61 | ) |
Cost of Sales
|
$ | (1 | ) | $ | (44 | ) | ||||
|
Foreign exchange contracts
|
- | 9 |
Other Income/Expense
|
- | 7 | ||||||||||||
|
Total
|
$ | (5 | ) | $ | (52 | ) | $ | (1 | ) | $ | (37 | ) | |||||
|
Metric
|
April 3, 2010
|
October 3, 2009
|
|
|
Commodity:
|
|||
|
Live Cattle
|
Pounds
|
458 million
|
133 million
|
|
Lean Hogs
|
Pounds
|
369 million
|
171 million
|
|
in millions
|
|||||||||||||||||
|
Consolidated Condensed
|
|||||||||||||||||
|
Statements of Income
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
|
Classification
|
April 3, 2010
|
March 28, 2009
|
April 3, 2010
|
March 28, 2009
|
|||||||||||||
|
Gain/(Loss) on forwards
|
Cost of Sales
|
$ | (17 | ) | $ | 47 | $ | (16 | ) | $ | 115 | ||||||
|
Gain/(Loss) on purchase contract
|
Cost of Sales
|
17 | (47 | ) | 16 | (115 | ) | ||||||||||
|
Gain/(Loss)
|
Consolidated Condensed
|
Gain/(Loss)
|
|||||||||||||||
|
Recognized in OCI
|
Statements of Income
|
Reclassified from
|
|||||||||||||||
|
On Derivatives
|
Classification
|
OCI to Earnings
|
|||||||||||||||
|
Three Months Ended
|
Three Months Ended
|
||||||||||||||||
|
April 3, 2010
|
March 28, 2009
|
April 3, 2010
|
March 28, 2009
|
||||||||||||||
|
Net Investment Hedge – Derivatives
|
|||||||||||||||||
|
designated as hedging instruments:
|
|||||||||||||||||
|
Foreign exchange contracts
|
$ | (1 | ) | $ | (5 | ) |
Other Income/Expense
|
$ | - | $ | - | ||||||
|
Gain/(Loss)
|
Consolidated Condensed
|
Gain/(Loss)
|
|||||||||||||||
|
Recognized in OCI
|
Statements of Income
|
Reclassified from
|
|||||||||||||||
|
On Derivatives
|
Classification
|
OCI to Earnings
|
|||||||||||||||
|
Six Months Ended
|
Six Months Ended
|
||||||||||||||||
|
April 3, 2010
|
March 28, 2009
|
April 3, 2010
|
March 28, 2009
|
||||||||||||||
|
Net Investment Hedge – Derivatives
|
|||||||||||||||||
|
designated as hedging instruments:
|
|||||||||||||||||
|
Foreign exchange contracts
|
$ | (1 | ) | $ | (1 | ) |
Other Income/Expense
|
$ | - | $ | - | ||||||
|
Metric
|
April 3, 2010
|
October 3, 2009
|
|
|
Commodity:
|
|||
|
Corn
|
Bushels
|
31 million
|
11 million
|
|
Soy meal
|
Tons
|
186,400
|
73,000
|
|
Live Cattle
|
Pounds
|
17 million
|
82 million
|
|
Lean Hogs
|
Pounds
|
142 million
|
11 million
|
|
Natural Gas
|
British thermal units
|
100 billion
|
850 billion
|
|
Foreign Currency
|
United States dollars
|
$95 million
|
$124 million
|
|
Interest Rate
|
Average monthly notional debt
|
$58 million
|
$64 million
|
|
Consolidated Condensed
|
|||||||||||||||||
|
Statements of Income
|
Gain/(Loss)
|
Gain/(Loss)
|
|||||||||||||||
|
Classification
|
Recognized in Earnings
|
Recognized in Earnings
|
|||||||||||||||
|
Three Months Ended
|
Six Months Ended
|
||||||||||||||||
|
April 3, 2010
|
March 28, 2009
|
April 3, 2010
|
March 28, 2009
|
||||||||||||||
|
Derivatives not designated as
|
|||||||||||||||||
|
hedging instruments:
|
|||||||||||||||||
|
Commodity contracts
|
Sales
|
$ | 14 | $ | (7 | ) | $ | 22 | $ | (22 | ) | ||||||
|
Commodity contracts
|
Cost of Sales
|
(24 | ) | (27 | ) | (31 | ) | (174 | ) | ||||||||
|
Foreign exchange contracts
|
Other Income/Expense
|
- | 6 | (2 | ) | 9 | |||||||||||
|
Interest rate contracts
|
Interest Expense
|
- | - | - | 3 | ||||||||||||
|
Total
|
$ | (10 | ) | $ | (28 | ) | $ | (11 | ) | $ | (184 | ) | |||||
|
Fair Value
|
|||||||||
|
Balance Sheet
|
April 3,
|
October 3,
|
|||||||
|
Classification
|
2010
|
2009
|
|||||||
|
Derivative Assets:
|
|||||||||
|
Derivatives designated as hedging instruments:
|
|||||||||
|
Commodity contracts
|
Other current assets
|
$ | - | $ | 12 | ||||
|
Derivatives not designated as hedging instruments:
|
|||||||||
|
Commodity contracts
|
Other current assets
|
10 | 9 | ||||||
|
Foreign exchange contracts
|
Other current assets
|
3 | - | ||||||
|
Total derivative assets – not designated
|
13 | 9 | |||||||
|
Total derivative assets
|
$ | 13 | $ | 21 | |||||
|
Derivative Liabilities:
|
|||||||||
|
Derivatives designated as hedging instruments:
|
|||||||||
|
Commodity contracts
|
Other current liabilities
|
$ | 42 | $ | 2 | ||||
|
Foreign exchange contracts
|
Other current liabilities
|
1 | - | ||||||
|
Total derivative liabilities – designated
|
43 | 2 | |||||||
|
Derivatives not designated as hedging instruments:
|
|||||||||
|
Commodity contracts
|
Other current liabilities
|
31 | 13 | ||||||
|
Foreign exchange contracts
|
Other current liabilities
|
2 | 1 | ||||||
|
Interest rate contracts
|
Other current liabilities
|
3 | 4 | ||||||
|
Total derivative liabilities – not designated
|
36 | 18 | |||||||
|
Total derivative liabilities
|
$ | 79 | $ | 20 | |||||
|
April 3, 2010
|
October 3, 2009
|
|||||||
|
Processed products:
|
||||||||
|
Weighted-average method – chicken and prepared foods
|
$ | 620 | $ | 629 | ||||
|
First-in, first-out method – beef and pork
|
416 | 414 | ||||||
|
Livestock – first-in, first-out method
|
748 | 631 | ||||||
|
Supplies and other – weighted-average method
|
328 | 335 | ||||||
|
Total inventories, net
|
$ | 2,112 | $ | 2,009 | ||||
|
April 3, 2010
|
October 3, 2009
|
|||||||
|
Land
|
$ | 96 | $ | 96 | ||||
|
Buildings and leasehold improvements
|
2,586 | 2,570 | ||||||
|
Machinery and equipment
|
4,658 | 4,640 | ||||||
|
Land improvements and other
|
228 | 227 | ||||||
|
Buildings and equipment under construction
|
452 | 297 | ||||||
| 8,020 | 7,830 | |||||||
|
Less accumulated depreciation
|
4,392 | 4,254 | ||||||
|
Net property, plant and equipment
|
$ | 3,628 | $ | 3,576 | ||||
|
April 3, 2010
|
October 3, 2009
|
|||||||
|
Accrued salaries, wages and benefits
|
$ | 314 | $ | 187 | ||||
|
Self-insurance reserves
|
235 | 230 | ||||||
|
Other
|
315 | 344 | ||||||
|
Total other current liabilities
|
$ | 864 | $ | 761 | ||||
|
April 3, 2010
|
October 3, 2009
|
|||||||
|
Revolving credit facility – expires March 2012
|
$ | - | $ | - | ||||
|
Senior notes:
|
||||||||
|
7.95% Notes due February 2010 (2010 Notes)
|
- | 140 | ||||||
|
8.25% Notes due October 2011 (2011 Notes)
|
552 | 839 | ||||||
|
3.25% Convertible senior notes due October 2013 (2013 Notes)
|
458 | 458 | ||||||
|
10.50% Senior notes due March 2014 (2014 Notes)
|
810 | 810 | ||||||
|
7.85% Senior notes due April 2016 (2016 Notes)
|
866 | 923 | ||||||
|
7.00% Notes due May 2018
|
140 | 174 | ||||||
|
7.125% Senior notes due February 2026
|
9 | 9 | ||||||
|
7.00% Notes due January 2028
|
27 | 27 | ||||||
|
Discount on senior notes
|
(119 | ) | (132 | ) | ||||
|
GO Zone tax-exempt bonds due October 2033 (0.25% at 4/3/2010)
|
100 | 100 | ||||||
|
Other
|
136 | 129 | ||||||
|
Total debt
|
2,979 | 3,477 | ||||||
|
Less current debt
|
90 | 219 | ||||||
|
Total long-term debt
|
$ | 2,889 | $ | 3,258 | ||||
|
●
|
during any fiscal quarter after December 27, 2008, if the last reported sale price of our Class A stock for at least 20 trading days during a period of 30 consecutive trading days ending on the last trading day of the preceding fiscal quarter is at least 130% of the applicable conversion price on each applicable trading day (which would currently require our shares to trade at or above $21.96); or
|
|
●
|
during the five business days after any 10 consecutive trading days (measurement period) in which the trading price per $1,000 principal amount of notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of our Class A stock and the applicable conversion rate on each such day; or
|
|
●
|
upon the occurrence of specified corporate events as defined in the supplemental indenture.
|
|
Condensed Consolidating Statement of Income for the three months ended April 3, 2010
|
in millions
|
|||||||||||||||||||||||||||||||
|
2014 Guarantors
|
||||||||||||||||||||||||||||||||
|
Non-
|
||||||||||||||||||||||||||||||||
|
TFI
|
TFM
|
Guar-
|
Elimin-
|
Sub-
|
Guar-
|
Elimin-
|
||||||||||||||||||||||||||
|
Parent
|
Parent
|
antors
|
ations
|
total
|
antors
|
ations
|
Total
|
|||||||||||||||||||||||||
|
Sales
|
$ | 128 | $ | 3,827 | $ | 3,061 | $ | (238 | ) | $ | 6,650 | $ | 266 | $ | (128 | ) | $ | 6,916 | ||||||||||||||
|
Cost of Sales
|
4 | 3,596 | 2,870 | (238 | ) | 6,228 | 248 | (128 | ) | 6,352 | ||||||||||||||||||||||
| 124 | 231 | 191 | - | 422 | 18 | - | 564 | |||||||||||||||||||||||||
|
Selling, general and administrative
|
25 | 44 | 131 | - | 175 | 20 | - | 220 | ||||||||||||||||||||||||
|
Operating Income (Loss)
|
99 | 187 | 60 | - | 247 | (2 | ) | - | 344 | |||||||||||||||||||||||
|
Other (Income) Expense:
|
||||||||||||||||||||||||||||||||
|
Interest expense, net
|
94 | 1 | 4 | - | 5 | (3 | ) | - | 96 | |||||||||||||||||||||||
|
Other, net
|
4 | 1 | (6 | ) | - | (5 | ) | - | - | (1 | ) | |||||||||||||||||||||
|
Equity in net earnings of subsidiaries
|
(159 | ) | (10 | ) | 6 | 6 | 2 | (4 | ) | 161 | - | |||||||||||||||||||||
| (61 | ) | (8 | ) | 4 | 6 | 2 | (7 | ) | 161 | 95 | ||||||||||||||||||||||
|
Income (Loss) from Continuing Operations before
|
||||||||||||||||||||||||||||||||
|
Income Taxes
|
160 | 195 | 56 | (6 | ) | 245 | 5 | (161 | ) | 249 | ||||||||||||||||||||||
|
Income Tax Expense
|
1 | 64 | 20 | - | 84 | 8 | - | 93 | ||||||||||||||||||||||||
|
Income (Loss) from Continuing Operations
|
159 | 131 | 36 | (6 | ) | 161 | (3 | ) | (161 | ) | 156 | |||||||||||||||||||||
|
Income from Discontinued Operation, net of tax
|
- | - | - | - | - | - | - | - | ||||||||||||||||||||||||
|
Net Income (Loss)
|
159 | 131 | 36 | (6 | ) | 161 | (3 | ) | (161 | ) | 156 | |||||||||||||||||||||
|
Less: Net Loss Attributable to Noncontrolling Interest
|
- | - | - | - | - | (3 | ) | - | (3 | ) | ||||||||||||||||||||||
|
Net Income (Loss) Attributable to Tyson
|
$ | 159 | $ | 131 | $ | 36 | $ | (6 | ) | $ | 161 | $ | - | $ | (161 | ) | $ | 159 | ||||||||||||||
|
Condensed Consolidating Statement of Income for the three months ended March 28, 2009
|
in millions
|
|||||||||||||||||||||||||||||||
|
2014 Guarantors
|
||||||||||||||||||||||||||||||||
|
Non-
|
||||||||||||||||||||||||||||||||
|
TFI
|
TFM
|
Guar-
|
Elimin-
|
Sub-
|
Guar-
|
Elimin-
|
||||||||||||||||||||||||||
|
Parent
|
Parent
|
antors
|
ations
|
total
|
antors
|
ations
|
Total
|
|||||||||||||||||||||||||
|
Sales
|
$ | 2 | $ | 3,319 | $ | 2,997 | $ | (176 | ) | $ | 6,140 | $ | 171 | $ | (6 | ) | $ | 6,307 | ||||||||||||||
|
Cost of Sales
|
5 | 3,226 | 2,850 | (176 | ) | 5,900 | 155 | (6 | ) | 6,054 | ||||||||||||||||||||||
| (3 | ) | 93 | 147 | - | 240 | 16 | - | 253 | ||||||||||||||||||||||||
|
Selling, general and administrative
|
31 | 49 | 113 | - | 162 | 16 | - | 209 | ||||||||||||||||||||||||
|
Other charges
|
- | - | 15 | - | 15 | - | - | 15 | ||||||||||||||||||||||||
|
Operating Income (Loss)
|
(34 | ) | 44 | 19 | - | 63 | - | - | 29 | |||||||||||||||||||||||
|
Other (Income) Expense:
|
||||||||||||||||||||||||||||||||
|
Interest expense, net
|
64 | - | 4 | - | 4 | 5 | - | 73 | ||||||||||||||||||||||||
|
Other, net
|
(1 | ) | (2 | ) | 1 | - | (1 | ) | 5 | - | 3 | |||||||||||||||||||||
|
Equity in net earnings of subsidiaries
|
(32 | ) | 11 | 32 | (15 | ) | 28 | (4 | ) | 8 | - | |||||||||||||||||||||
| 31 | 9 | 37 | (15 | ) | 31 | 6 | 8 | 76 | ||||||||||||||||||||||||
|
Income (Loss) from Continuing Operations before
|
||||||||||||||||||||||||||||||||
|
Income Taxes
|
(65 | ) | 35 | (18 | ) | 15 | 32 | (6 | ) | (8 | ) | (47 | ) | |||||||||||||||||||
|
Income Tax Expense (Benefit)
|
60 | 7 | (9 | ) | - | (2 | ) | - | - | 58 | ||||||||||||||||||||||
|
Income (Loss) from Continuing Operations
|
(125 | ) | 28 | (9 | ) | 15 | 34 | (6 | ) | (8 | ) | (105 | ) | |||||||||||||||||||
|
Income (Loss) from Discontinued Operation, net of tax
|
7 | - | - | - | - | (21 | ) | - | (14 | ) | ||||||||||||||||||||||
|
Net Income (Loss)
|
(118 | ) | 28 | (9 | ) | 15 | 34 | (27 | ) | (8 | ) | (119 | ) | |||||||||||||||||||
|
Less: Net Loss Attributable to Noncontrolling Interest
|
1 | - | - | - | - | (1 | ) | - | - | |||||||||||||||||||||||
|
Net Income (Loss) Attributable to Tyson
|
$ | (119 | ) | $ | 28 | $ | (9 | ) | $ | 15 | $ | 34 | $ | (26 | ) | $ | (8 | ) | $ | (119 | ) | |||||||||||
|
Condensed Consolidating Statement of Income for the six months ended April 3, 2010
|
in millions
|
|||||||||||||||||||||||||||||||
|
2014 Guarantors
|
||||||||||||||||||||||||||||||||
|
Non-
|
||||||||||||||||||||||||||||||||
|
TFI
|
TFM
|
Guar-
|
Elimin-
|
Sub-
|
Guar-
|
Elimin-
|
||||||||||||||||||||||||||
|
Parent
|
Parent
|
antors
|
ations
|
total
|
antors
|
ations
|
Total
|
|||||||||||||||||||||||||
|
Sales
|
$ | 221 | $ | 7,431 | $ | 5,986 | $ | (423 | ) | $ | 12,994 | $ | 555 | $ | (219 | ) | $ | 13,551 | ||||||||||||||
|
Cost of Sales
|
(6 | ) | 6,985 | 5,596 | (423 | ) | 12,158 | 525 | (219 | ) | 12,458 | |||||||||||||||||||||
| 227 | 446 | 390 | - | 836 | 30 | - | 1,093 | |||||||||||||||||||||||||
|
Selling, general and administrative
|
53 | 88 | 255 | - | 343 | 39 | - | 435 | ||||||||||||||||||||||||
|
Operating Income (Loss)
|
174 | 358 | 135 | - | 493 | (9 | ) | - | 658 | |||||||||||||||||||||||
|
Other (Income) Expense:
|
||||||||||||||||||||||||||||||||
|
Interest expense, net
|
170 | 3 | 8 | - | 11 | (8 | ) | - | 173 | |||||||||||||||||||||||
|
Other, net
|
8 | 1 | (7 | ) | - | (6 | ) | (2 | ) | - | - | |||||||||||||||||||||
|
Equity in net earnings of subsidiaries
|
(323 | ) | (28 | ) | 16 | 18 | 6 | (10 | ) | 327 | - | |||||||||||||||||||||
| (145 | ) | (24 | ) | 17 | 18 | 11 | (20 | ) | 327 | 173 | ||||||||||||||||||||||
|
Income (Loss) from Continuing Operations before
|
||||||||||||||||||||||||||||||||
|
Income Taxes
|
319 | 382 | 118 | (18 | ) | 482 | 11 | (327 | ) | 485 | ||||||||||||||||||||||
|
Income Tax Expense
|
- | 117 | 38 | - | 155 | 15 | - | 170 | ||||||||||||||||||||||||
|
Income (Loss) from Continuing Operations
|
319 | 265 | 80 | (18 | ) | 327 | (4 | ) | (327 | ) | 315 | |||||||||||||||||||||
|
Income from Discontinued Operation, net of tax
|
- | - | - | - | - | - | - | - | ||||||||||||||||||||||||
|
Net Income (Loss)
|
319 | 265 | 80 | (18 | ) | 327 | (4 | ) | (327 | ) | 315 | |||||||||||||||||||||
|
Less: Net Loss Attributable to Noncontrolling Interest
|
- | - | - | - | - | (4 | ) | - | (4 | ) | ||||||||||||||||||||||
|
Net Income (Loss) Attributable to Tyson
|
$ | 319 | $ | 265 | $ | 80 | $ | (18 | ) | $ | 327 | $ | - | $ | (327 | ) | $ | 319 | ||||||||||||||
|
Condensed Consolidating Statement of Income for the six months ended March 28, 2009
|
in millions
|
|||||||||||||||||||||||||||||||
|
2014 Guarantors
|
||||||||||||||||||||||||||||||||
|
Non-
|
||||||||||||||||||||||||||||||||
|
TFI
|
TFM
|
Guar-
|
Elimin-
|
Sub-
|
Guar-
|
Elimin-
|
||||||||||||||||||||||||||
|
Parent
|
Parent
|
antors
|
ations
|
total
|
antors
|
ations
|
Total
|
|||||||||||||||||||||||||
|
Sales
|
$ | 4 | $ | 6,933 | $ | 5,933 | $ | (370 | ) | $ | 12,496 | $ | 341 | $ | (13 | ) | $ | 12,828 | ||||||||||||||
|
Cost of Sales
|
282 | 6,745 | 5,600 | (370 | ) | 11,975 | 313 | (13 | ) | 12,557 | ||||||||||||||||||||||
| (278 | ) | 188 | 333 | - | 521 | 28 | - | 271 | ||||||||||||||||||||||||
|
Selling, general and administrative
|
60 | 102 | 230 | - | 332 | 33 | - | 425 | ||||||||||||||||||||||||
|
Other charges
|
- | - | 15 | - | 15 | - | - | 15 | ||||||||||||||||||||||||
|
Operating Income (Loss)
|
(338 | ) | 86 | 88 | - | 174 | (5 | ) | - | (169 | ) | |||||||||||||||||||||
|
Other (Income) Expense:
|
||||||||||||||||||||||||||||||||
|
Interest expense, net
|
121 | 4 | 9 | - | 13 | 2 | - | 136 | ||||||||||||||||||||||||
|
Other, net
|
- | (2 | ) | - | - | (2 | ) | 23 | - | 21 | ||||||||||||||||||||||
|
Equity in net earnings of subsidiaries
|
(63 | ) | 17 | 57 | (23 | ) | 51 | (6 | ) | 18 | - | |||||||||||||||||||||
| 58 | 19 | 66 | (23 | ) | 62 | 19 | 18 | 157 | ||||||||||||||||||||||||
|
Income (Loss) from Continuing Operations before
|
||||||||||||||||||||||||||||||||
|
Income Taxes
|
(396 | ) | 67 | 22 | 23 | 112 | (24 | ) | (18 | ) | (326 | ) | ||||||||||||||||||||
|
Income Tax Expense (Benefit)
|
(156 | ) | 28 | 27 | - | 55 | (10 | ) | - | (111 | ) | |||||||||||||||||||||
|
Income (Loss) from Continuing Operations
|
(240 | ) | 39 | (5 | ) | 23 | 57 | (14 | ) | (18 | ) | (215 | ) | |||||||||||||||||||
|
Income (Loss) from Discontinued Operation, net of tax
|
20 | 8 | - | - | 8 | (36 | ) | - | (8 | ) | ||||||||||||||||||||||
|
Net Income (Loss)
|
(220 | ) | 47 | (5 | ) | 23 | 65 | (50 | ) | (18 | ) | (223 | ) | |||||||||||||||||||
|
Less: Net Loss Attributable to Noncontrolling Interest
|
1 | - | - | - | - | (3 | ) | - | (2 | ) | ||||||||||||||||||||||
|
Net Income (Loss) Attributable to Tyson
|
$ | (221 | ) | $ | 47 | $ | (5 | ) | $ | 23 | $ | 65 | $ | (47 | ) | $ | (18 | ) | $ | (221 | ) | |||||||||||
|
Condensed Consolidating Balance Sheet as of April 3, 2010
|
in millions
|
|||||||||||||||||||||||||||||||
|
2014 Guarantors
|
||||||||||||||||||||||||||||||||
|
Non-
|
||||||||||||||||||||||||||||||||
|
TFI
|
TFM
|
Guar-
|
Elimin-
|
Guar-
|
Elimin-
|
|||||||||||||||||||||||||||
|
Parent
|
Parent
|
antors
|
ations
|
Subtotal
|
antors
|
ations
|
Total
|
|||||||||||||||||||||||||
|
Assets
|
||||||||||||||||||||||||||||||||
|
Current Assets:
|
||||||||||||||||||||||||||||||||
|
Cash and cash equivalents
|
$ | - | $ | - | $ | 643 | $ | - | $ | 643 | $ | 169 | $ | - | $ | 812 | ||||||||||||||||
|
Accounts receivable, net
|
1 | 446 | 3,647 | (106 | ) | 3,987 | 118 | (2,981 | ) | 1,125 | ||||||||||||||||||||||
|
Inventories, net
|
1 | 676 | 1,262 | - | 1,938 | 173 | - | 2,112 | ||||||||||||||||||||||||
|
Other current assets
|
36 | 46 | 35 | (11 | ) | 70 | 84 | (10 | ) | 180 | ||||||||||||||||||||||
|
Total Current Assets
|
38 | 1,168 | 5,587 | (117 | ) | 6,638 | 544 | (2,991 | ) | 4,229 | ||||||||||||||||||||||
|
Net Property, Plant and Equipment
|
41 | 864 | 2,243 | - | 3,107 | 480 | - | 3,628 | ||||||||||||||||||||||||
|
Goodwill
|
- | 880 | 968 | - | 1,848 | 70 | - | 1,918 | ||||||||||||||||||||||||
|
Intangible Assets
|
- | 39 | 57 | - | 96 | 80 | - | 176 | ||||||||||||||||||||||||
|
Other Assets
|
163 | 131 | 43 | - | 174 | 305 | (182 | ) | 460 | |||||||||||||||||||||||
|
Investment in Subsidiaries
|
10,351 | 1,778 | 660 | (1,602 | ) | 836 | 306 | (11,493 | ) | - | ||||||||||||||||||||||
|
Total Assets
|
$ | 10,593 | $ | 4,860 | $ | 9,558 | $ | (1,719 | ) | $ | 12,699 | $ | 1,785 | $ | (14,666 | ) | $ | 10,411 | ||||||||||||||
|
Liabilities and Shareholders’ Equity
|
||||||||||||||||||||||||||||||||
|
Current Liabilities:
|
||||||||||||||||||||||||||||||||
|
Current debt
|
$ | 3 | $ | - | $ | - | $ | - | $ | - | $ | 87 | $ | - | $ | 90 | ||||||||||||||||
|
Trade accounts payable
|
32 | 371 | 501 | - | 872 | 59 | - | 963 | ||||||||||||||||||||||||
|
Other current liabilities
|
3,010 | 234 | 309 | (117 | ) | 426 | 419 | (2,991 | ) | 864 | ||||||||||||||||||||||
|
Total Current Liabilities
|
3,045 | 605 | 810 | (117 | ) | 1,298 | 565 | (2,991 | ) | 1,917 | ||||||||||||||||||||||
|
Long-Term Debt
|
2,745 | 15 | 180 | - | 195 | 129 | (180 | ) | 2,889 | |||||||||||||||||||||||
|
Deferred Income Taxes
|
- | 106 | 186 | - | 292 | 19 | (2 | ) | 309 | |||||||||||||||||||||||
|
Other Liabilities
|
110 | 153 | 209 | - | 362 | 36 | - | 508 | ||||||||||||||||||||||||
|
Redeemable Noncontrolling Interest
|
- | - | - | - | - | 65 | - | 65 | ||||||||||||||||||||||||
|
Total Tyson Shareholders’ Equity
|
4,693 | 3,981 | 8,173 | (1,602 | ) | 10,552 | 941 | (11,493 | ) | 4,693 | ||||||||||||||||||||||
|
Noncontrolling Interest
|
- | - | - | - | - | 30 | - | 30 | ||||||||||||||||||||||||
|
Total Shareholders’ Equity
|
4,693 | 3,981 | 8,173 | (1,602 | ) | 10,552 | 971 | (11,493 | ) | 4,723 | ||||||||||||||||||||||
|
Total Liabilities and Shareholders’ Equity
|
$ | 10,593 | $ | 4,860 | $ | 9,558 | $ | (1,719 | ) | $ | 12,699 | $ | 1,785 | $ | (14,666 | ) | $ | 10,411 | ||||||||||||||
|
Condensed Consolidating Balance Sheet as of October 3, 2009
|
in millions
|
|||||||||||||||||||||||||||||||
|
2014 Guarantors
|
||||||||||||||||||||||||||||||||
|
Non-
|
||||||||||||||||||||||||||||||||
|
TFI
|
TFM
|
Guar-
|
Elimin-
|
Guar-
|
Elimin-
|
|||||||||||||||||||||||||||
|
Parent
|
Parent
|
antors
|
ations
|
Subtotal
|
antors
|
ations
|
Total
|
|||||||||||||||||||||||||
|
Assets
|
||||||||||||||||||||||||||||||||
|
Current Assets:
|
||||||||||||||||||||||||||||||||
|
Cash and cash equivalents
|
$ | - | $ | - | $ | 788 | $ | - | $ | 788 | $ | 216 | $ | - | $ | 1,004 | ||||||||||||||||
|
Restricted cash
|
- | - | 140 | - | 140 | - | - | 140 | ||||||||||||||||||||||||
|
Accounts receivable, net
|
2 | 418 | 3,309 | (7 | ) | 3,720 | 116 | (2,738 | ) | 1,100 | ||||||||||||||||||||||
|
Inventories, net
|
1 | 586 | 1,239 | - | 1,825 | 183 | - | 2,009 | ||||||||||||||||||||||||
|
Other current assets
|
198 | 89 | 29 | (17 | ) | 101 | 36 | (213 | ) | 122 | ||||||||||||||||||||||
|
Total Current Assets
|
201 | 1,093 | 5,505 | (24 | ) | 6,574 | 551 | (2,951 | ) | 4,375 | ||||||||||||||||||||||
|
Restricted Cash
|
- | - | - | - | - | 43 | - | 43 | ||||||||||||||||||||||||
|
Net Property, Plant and Equipment
|
40 | 883 | 2,256 | - | 3,139 | 397 | - | 3,576 | ||||||||||||||||||||||||
|
Goodwill
|
- | 881 | 977 | - | 1,858 | 59 | - | 1,917 | ||||||||||||||||||||||||
|
Intangible Assets
|
- | 42 | 59 | - | 101 | 86 | - | 187 | ||||||||||||||||||||||||
|
Other Assets
|
211 | 120 | 37 | - | 157 | 346 | (217 | ) | 497 | |||||||||||||||||||||||
|
Investment in Subsidiaries
|
10,038 | 1,763 | 674 | (1,597 | ) | 840 | 296 | (11,174 | ) | - | ||||||||||||||||||||||
|
Total Assets
|
$ | 10,490 | $ | 4,782 | $ | 9,508 | $ | (1,621 | ) | $ | 12,669 | $ | 1,778 | $ | (14,342 | ) | $ | 10,595 | ||||||||||||||
|
Liabilities and Shareholders’ Equity
|
||||||||||||||||||||||||||||||||
|
Current Liabilities:
|
||||||||||||||||||||||||||||||||
|
Current debt
|
$ | 3 | $ | 140 | $ | - | $ | - | $ | 140 | $ | 76 | $ | - | $ | 219 | ||||||||||||||||
|
Trade accounts payable
|
15 | 375 | 550 | - | 925 | 73 | - | 1,013 | ||||||||||||||||||||||||
|
Other current liabilities
|
2,790 | 251 | 296 | (24 | ) | 523 | 399 | (2,951 | ) | 761 | ||||||||||||||||||||||
|
Total Current Liabilities
|
2,808 | 766 | 846 | (24 | ) | 1,588 | 548 | (2,951 | ) | 1,993 | ||||||||||||||||||||||
|
Long-Term Debt
|
3,112 | 15 | 180 | - | 195 | 131 | (180 | ) | 3,258 | |||||||||||||||||||||||
|
Deferred Income Taxes
|
29 | 108 | 182 | - | 290 | 27 | (37 | ) | 309 | |||||||||||||||||||||||
|
Other Liabilities
|
143 | 161 | 202 | - | 363 | 33 | - | 539 | ||||||||||||||||||||||||
|
Redeemable Noncontrolling Interest
|
- | - | - | - | - | 65 | - | 65 | ||||||||||||||||||||||||
|
Total Tyson Shareholders’ Equity
|
4,398 | 3,732 | 8,098 | (1,597 | ) | 10,233 | 941 | (11,174 | ) | 4,398 | ||||||||||||||||||||||
|
Noncontrolling Interest
|
- | - | - | - | - | 33 | - | 33 | ||||||||||||||||||||||||
|
Total Shareholders’ Equity
|
4,398 | 3,732 | 8,098 | (1,597 | ) | 10,233 | 974 | (11,174 | ) | 4,431 | ||||||||||||||||||||||
|
Total Liabilities and Shareholders’ Equity
|
$ | 10,490 | $ | 4,782 | $ | 9,508 | $ | (1,621 | ) | $ | 12,669 | $ | 1,778 | $ | (14,342 | ) | $ | 10,595 | ||||||||||||||
|
Condensed Consolidating Statement of Cash Flows for the six months ended April 3, 2010
|
in millions
|
|||||||||||||||||||||||||||||||
|
2014 Guarantors
|
||||||||||||||||||||||||||||||||
|
Non-
|
||||||||||||||||||||||||||||||||
|
TFI
|
TFM
|
Guar-
|
Elimin-
|
Sub-
|
Guar-
|
Elimin-
|
||||||||||||||||||||||||||
|
Parent
|
Parent
|
antors
|
ations
|
total
|
antors
|
ations
|
Total
|
|||||||||||||||||||||||||
|
Cash Provided by (Used for) Operating Activities
|
$ | 234 | $ | 78 | $ | 204 | $ | - | $ | 282 | $ | (17 | ) | $ | - | $ | 499 | |||||||||||||||
|
Cash Flows from Investing Activities:
|
||||||||||||||||||||||||||||||||
|
Additions to property, plant and equipment
|
(2 | ) | (30 | ) | (144 | ) | - | (174 | ) | (88 | ) | - | (264 | ) | ||||||||||||||||||
|
Change in restricted cash
|
- | - | - | - | - | 43 | - | 43 | ||||||||||||||||||||||||
|
Purchases of marketable securities, net
|
- | - | - | - | - | (4 | ) | - | (4 | ) | ||||||||||||||||||||||
|
Other, net
|
(1 | ) | 1 | 5 | - | 6 | (7 | ) | - | (2 | ) | |||||||||||||||||||||
|
Cash Used for Investing Activities
|
(3 | ) | (29 | ) | (139 | ) | - | (168 | ) | (56 | ) | - | (227 | ) | ||||||||||||||||||
|
Cash Flows from Financing Activities:
|
||||||||||||||||||||||||||||||||
|
Net change in debt
|
(404 | ) | (140 | ) | - | - | (140 | ) | 4 | - | (540 | ) | ||||||||||||||||||||
|
Change in restricted cash
|
- | - | 140 | - | 140 | - | - | 140 | ||||||||||||||||||||||||
|
Purchase of treasury shares
|
(31 | ) | - | - | - | - | - | - | (31 | ) | ||||||||||||||||||||||
|
Dividends
|
(30 | ) | - | - | - | - | - | - | (30 | ) | ||||||||||||||||||||||
|
Other, net
|
15 | (5 | ) | (8 | ) | - | (13 | ) | - | - | 2 | |||||||||||||||||||||
|
Net change in intercompany balances
|
219 | 96 | (342 | ) | - | (246 | ) | 27 | - | - | ||||||||||||||||||||||
|
Cash Provided by (Used for) Financing Activities
|
(231 | ) | (49 | ) | (210 | ) | - | (259 | ) | 31 | - | (459 | ) | |||||||||||||||||||
|
Effect of Exchange Rate Change on Cash
|
- | - | - | - | - | (5 | ) | - | (5 | ) | ||||||||||||||||||||||
|
Decrease in Cash and Cash Equivalents
|
- | - | (145 | ) | - | (145 | ) | (47 | ) | - | (192 | ) | ||||||||||||||||||||
|
Cash and Cash Equivalents at Beginning of Year
|
- | - | 788 | - | 788 | 216 | - | 1,004 | ||||||||||||||||||||||||
|
Cash and Cash Equivalents at End of Period
|
$ | - | $ | - | $ | 643 | $ | - | $ | 643 | $ | 169 | $ | - | $ | 812 | ||||||||||||||||
|
Condensed Consolidating Statement of Cash Flows for the six months ended March 28, 2009
|
in millions
|
|||||||||||||||||||||||||||||||
|
2014 Guarantors
|
||||||||||||||||||||||||||||||||
|
Non-
|
||||||||||||||||||||||||||||||||
|
TFI
|
TFM
|
Guar-
|
Elimin-
|
Sub-
|
Guar-
|
Elimin-
|
||||||||||||||||||||||||||
|
Parent
|
Parent
|
antors
|
ations
|
total
|
antors
|
ations
|
Total
|
|||||||||||||||||||||||||
|
Cash Provided by (Used for) Operating Activities
|
$ | (265 | ) | $ | 123 | $ | 595 | $ | - | $ | 718 | $ | (21 | ) | $ | (25 | ) | $ | 407 | |||||||||||||
|
Cash Flows from Investing Activities:
|
||||||||||||||||||||||||||||||||
|
Additions to property, plant and equipment
|
- | (31 | ) | (100 | ) | - | (131 | ) | (29 | ) | - | (160 | ) | |||||||||||||||||||
|
Change in restricted cash
|
- | - | - | - | - | (76 | ) | - | (76 | ) | ||||||||||||||||||||||
|
Proceeds from sale of marketable securities, net
|
- | - | - | - | - | 12 | - | 12 | ||||||||||||||||||||||||
|
Proceeds from sale of discontinued operation
|
- | - | - | - | - | 43 | - | 43 | ||||||||||||||||||||||||
|
Acquisitions, net of cash acquired
|
(5 | ) | - | (13 | ) | - | (13 | ) | (58 | ) | - | (76 | ) | |||||||||||||||||||
|
Other, net
|
2 | 4 | 12 | - | 16 | 2 | - | 20 | ||||||||||||||||||||||||
|
Cash Used for Investing Activities
|
(3 | ) | (27 | ) | (101 | ) | - | (128 | ) | (106 | ) | - | (237 | ) | ||||||||||||||||||
|
Cash Flows from Financing Activities:
|
||||||||||||||||||||||||||||||||
|
Net change in debt
|
707 | - | - | - | - | 91 | - | 798 | ||||||||||||||||||||||||
|
Debt issuance costs
|
(57 | ) | - | - | - | - | (1 | ) | - | (58 | ) | |||||||||||||||||||||
|
Change in restricted cash
|
- | - | (234 | ) | - | (234 | ) | - | - | (234 | ) | |||||||||||||||||||||
|
Purchase of treasury shares
|
(4 | ) | - | - | - | - | - | - | (4 | ) | ||||||||||||||||||||||
|
Dividends
|
(30 | ) | - | - | - | - | (25 | ) | 25 | (30 | ) | |||||||||||||||||||||
|
Other, net
|
1 | (6 | ) | (74 | ) | - | (80 | ) | (7 | ) | - | (86 | ) | |||||||||||||||||||
|
Net change in intercompany balances
|
(489 | ) | (89 | ) | 461 | - | 372 | 117 | - | - | ||||||||||||||||||||||
|
Cash Provided by (Used for) Financing Activities
|
128 | (95 | ) | 153 | - | 58 | 175 | 25 | 386 | |||||||||||||||||||||||
|
Effect of Exchange Rate Change on Cash
|
- | - | - | - | - | 11 | - | 11 | ||||||||||||||||||||||||
|
Increase (Decrease) in Cash and Cash Equivalents
|
(140 | ) | 1 | 647 | - | 648 | 59 | - | 567 | |||||||||||||||||||||||
|
Cash and Cash Equivalents at Beginning of Year
|
140 | - | 35 | - | 35 | 75 | - | 250 | ||||||||||||||||||||||||
|
Cash and Cash Equivalents at End of Period
|
$ | - | $ | 1 | $ | 682 | $ | - | $ | 683 | $ | 134 | $ | - | $ | 817 | ||||||||||||||||
|
●
|
Quoted prices for similar assets or liabilities in active markets;
|
|
|
●
|
Quoted prices for identical or similar assets in non-active markets;
|
|
|
●
|
Inputs other than quoted prices that are observable for the asset or liability; and
|
|
|
●
|
Inputs derived principally from or corroborated by other observable market data.
|
|
April 3, 2010
|
Level 1
|
Level 2
|
Level 3
|
Netting (a)
|
Total
|
|||||||||||||||
|
Assets:
|
||||||||||||||||||||
|
Commodity Derivatives
|
$ | - | $ | 10 | $ | - | $ | (8 | ) | $ | 2 | |||||||||
|
Foreign Exchange Forward Contracts
|
- | 3 | - | (2 | ) | 1 | ||||||||||||||
|
Available for Sale Securities:
|
||||||||||||||||||||
|
Debt securities
|
- | 37 | 76 | - | 113 | |||||||||||||||
|
Equity securities
|
17 | - | - | - | 17 | |||||||||||||||
|
Deferred Compensation Assets
|
- | 86 | - | - | 86 | |||||||||||||||
|
Total Assets
|
$ | 17 | $ | 136 | $ | 76 | $ | (10 | ) | $ | 219 | |||||||||
|
Liabilities:
|
||||||||||||||||||||
|
Commodity Derivatives
|
$ | - | $ | 73 | $ | - | $ | (71 | ) | $ | 2 | |||||||||
|
Foreign Exchange Forward Contracts
|
- | 3 | - | (2 | ) | 1 | ||||||||||||||
|
Interest Rate Swap
|
- | 3 | - | (2 | ) | 1 | ||||||||||||||
|
Total Liabilities
|
$ | - | $ | 79 | $ | - | $ | (75 | ) | $ | 4 | |||||||||
|
October 3, 2009
|
Level 1
|
Level 2
|
Level 3
|
Netting (a)
|
Total
|
|||||||||||||||
|
Assets:
|
||||||||||||||||||||
|
Commodity Derivatives
|
$ | - | $ | 21 | $ | - | $ | (17 | ) | $ | 4 | |||||||||
|
Available for Sale Securities:
|
||||||||||||||||||||
|
Debt securities
|
- | 33 | 72 | - | 105 | |||||||||||||||
|
Equity securities
|
20 | - | - | - | 20 | |||||||||||||||
|
Deferred Compensation Assets
|
2 | 84 | - | - | 86 | |||||||||||||||
|
Total Assets
|
$ | 22 | $ | 138 | $ | 72 | $ | (17 | ) | $ | 215 | |||||||||
|
Liabilities:
|
||||||||||||||||||||
|
Commodity Derivatives
|
$ | - | $ | 15 | $ | - | $ | (11 | ) | $ | 4 | |||||||||
|
Foreign Exchange Forward Contracts
|
- | 1 | - | - | 1 | |||||||||||||||
|
Interest Rate Swap
|
- | 4 | - | (2 | ) | 2 | ||||||||||||||
|
Total Liabilities
|
$ | - | $ | 20 | $ | - | $ | (13 | ) | $ | 7 | |||||||||
|
Six Months Ended
|
||||||||
|
April 3, 2010
|
March 28, 2009
|
|||||||
|
Balance at beginning of year
|
$ | 72 | $ | 54 | ||||
|
Total realized and unrealized gains (losses):
|
||||||||
|
Included in earnings
|
- | (4 | ) | |||||
|
Included in other comprehensive income (loss)
|
1 | (1 | ) | |||||
|
Purchases, issuances and settlements, net
|
3 | 17 | ||||||
|
Balance at end of period
|
$ | 76 | $ | 66 | ||||
|
Total gains (losses) for the six-month period included in earnings
|
||||||||
|
attributable to the change in unrealized gains (losses) relating to
|
||||||||
|
assets and liabilities still held at end of period
|
$ | - | $ | (4 | ) | |||
|
(in millions)
|
April 3, 2010
|
October 3, 2009
|
||||||||||||||||||||||
|
Amortized Cost Basis
|
Fair
Value
|
Unrealized Gain
|
Amortized Cost Basis
|
Fair
Value
|
Unrealized Gain
|
|||||||||||||||||||
|
Available for Sale Securities:
|
||||||||||||||||||||||||
|
Debt Securities:
|
||||||||||||||||||||||||
|
U.S. Treasury and Agency
|
$ | 37 | $ | 37 | $ | - | $ | 33 | $ | 33 | $ | - | ||||||||||||
|
Corporate and Asset-Backed (a)
|
47 | 50 | 3 | 46 | 48 | 2 | ||||||||||||||||||
|
Redeemable Preferred Stock
|
26 | 26 | - | 24 | 24 | - | ||||||||||||||||||
|
Equity Securities – Common Stock
|
9 | 17 | 8 | 9 | 20 | 11 | ||||||||||||||||||
|
(a)
|
At April 3, 2010, and October 3, 2009, the amortized cost basis for Corporate and Asset-Backed debt securities had been reduced by accumulated other than temporary impairments of $4 million.
|
|
April 3, 2010
|
October 3, 2009
|
|||||||||||||||
|
Fair
Value
|
Carrying
Value
|
Fair
Value
|
Carrying
Value
|
|||||||||||||
|
Total Debt
|
$ | 3,147 | $ | 2,979 | $ | 3,724 | $ | 3,477 | ||||||||
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
|
April 3, 2010
|
March 28, 2009
|
April 3, 2010
|
March 28, 2009
|
|||||||||||||
|
Numerator:
|
||||||||||||||||
|
Income (loss) from continuing operations
|
$ | 156 | $ | (105 | ) | $ | 315 | $ | (215 | ) | ||||||
|
Less: Net loss attributable to noncontrolling interest
|
(3 | ) | - | (4 | ) | (2 | ) | |||||||||
|
Income (loss) from continuing operations attributable to Tyson
|
159 | (105 | ) | 319 | (213 | ) | ||||||||||
|
Less Dividends:
|
||||||||||||||||
|
Class A ($0.040/share)
|
13 | 13 | 25 | 25 | ||||||||||||
|
Class B ($0.036/share)
|
2 | 2 | 5 | 5 | ||||||||||||
|
Undistributed earnings (losses)
|
$ | 144 | $ | (120 | ) | $ | 289 | $ | (243 | ) | ||||||
|
Class A undistributed earnings (losses)
|
$ | 119 | $ | (99 | ) | $ | 239 | $ | (201 | ) | ||||||
|
Class B undistributed earnings (losses)
|
25 | (21 | ) | 50 | (42 | ) | ||||||||||
|
Total undistributed earnings (losses)
|
$ | 144 | $ | (120 | ) | $ | 289 | $ | (243 | ) | ||||||
|
Denominator:
|
||||||||||||||||
|
Denominator for basic earnings (loss) per share:
|
||||||||||||||||
|
Class A weighted average shares
|
303 | 303 | 303 | 303 | ||||||||||||
|
Class B weighted average shares, and shares under the if-converted method for diluted earnings per share
|
70 | 70 | 70 | 70 | ||||||||||||
|
Effect of dilutive securities:
|
||||||||||||||||
|
Stock options and restricted stock
|
5 | - | 4 | - | ||||||||||||
|
Denominator for diluted earnings (loss) per share – adjusted weighted average shares and assumed conversions
|
378 | 373 | 377 | 373 | ||||||||||||
|
Earnings (Loss) Per Share from Continuing Operations Attributable to Tyson:
|
||||||||||||||||
|
Class A Basic
|
$ | 0.43 | $ | (0.29 | ) | $ | 0.87 | $ | (0.58 | ) | ||||||
|
Class B Basic
|
$ | 0.39 | $ | (0.26 | ) | $ | 0.78 | $ | (0.53 | ) | ||||||
|
Diluted
|
$ | 0.42 | $ | (0.28 | ) | $ | 0.84 | $ | (0.57 | ) | ||||||
|
Net Income (Loss) Per Share Attributable to Tyson:
|
||||||||||||||||
|
Class A Basic
|
$ | 0.43 | $ | (0.33 | ) | $ | 0.87 | $ | (0.60 | ) | ||||||
|
Class B Basic
|
$ | 0.39 | $ | (0.30 | ) | $ | 0.78 | $ | (0.55 | ) | ||||||
|
Diluted
|
$ | 0.42 | $ | (0.32 | ) | $ | 0.84 | $ | (0.59 | ) | ||||||
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
|
April 3, 2010
|
March 28, 2009
|
April 3, 2010
|
March 28, 2009
|
|||||||||||||
|
Net income (loss)
|
$ | 156 | $ | (119 | ) | $ | 315 | $ | (223 | ) | ||||||
|
Other comprehensive income (loss), net of tax:
|
||||||||||||||||
|
Currency translation adjustment
|
6 | (20 | ) | 12 | (94 | ) | ||||||||||
|
Currency translation adjustment reclassified to loss
|
||||||||||||||||
|
on discontinued operations
|
- | (37 | ) | - | (37 | ) | ||||||||||
|
Postretirement benefits reserve adjustments
|
1 | - | - | (5 | ) | |||||||||||
|
Unrealized gain (loss) on investments
|
(3 | ) | 3 | (2 | ) | (4 | ) | |||||||||
|
Unrealized loss on investments reclassified to other income
|
- | 4 | - | 4 | ||||||||||||
|
Net hedging unrealized loss
|
(4 | ) | (3 | ) | (3 | ) | (32 | ) | ||||||||
|
Net hedging unrealized (gain) loss reclassified to earnings
|
(1 | ) | 7 | - | 23 | |||||||||||
|
Total comprehensive income (loss)
|
155 | (165 | ) | 322 | (368 | ) | ||||||||||
|
Comprehensive loss attributable to noncontrolling interest
|
(3 | ) | - | (4 | ) | (2 | ) | |||||||||
|
Total comprehensive income (loss) attributable to Tyson
|
$ | 158 | $ | (165 | ) | $ | 326 | $ | (366 | ) | ||||||
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
|
April 3, 2010
|
March 28, 2009
|
April 3, 2010
|
March 28, 2009
|
|||||||||||||
|
Income tax expense (benefit):
|
||||||||||||||||
|
Currency translation adjustment
|
$ | - | $ | (1 | ) | $ | - | $ | - | |||||||
|
Postretirement benefits reserve adjustments
|
- | - | - | 5 | ||||||||||||
|
Unrealized loss on investments
|
- | - | - | (1 | ) | |||||||||||
|
Unrealized loss on investments reclassified to other income
|
- | 1 | - | 1 | ||||||||||||
|
Net hedging unrealized loss
|
(3 | ) | (2 | ) | (2 | ) | (20 | ) | ||||||||
|
Net hedging unrealized (gain) loss reclassified to earnings
|
- | 4 | 1 | 14 | ||||||||||||
|
Total income tax expense (benefit)
|
$ | (3 | ) | $ | 2 | $ | (1 | ) | $ | (1 | ) | |||||
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||||
|
April 3, 2010
|
March 28, 2009
|
April 3, 2010
|
March 28, 2009
|
|||||||||||||||
|
Sales:
|
||||||||||||||||||
|
Chicken
|
$ | 2,491 | $ | 2,360 | $ | 4,916 | $ | 4,594 | ||||||||||
|
Beef
|
2,762 | 2,419 | 5,444 | 5,082 | ||||||||||||||
|
Pork
|
929 | 844 | 1,744 | 1,722 | ||||||||||||||
|
Prepared Foods
|
734 | 684 | 1,447 | 1,430 | ||||||||||||||
|
Total Sales
|
$ | 6,916 | $ | 6,307 | $ | 13,551 | $ | 12,828 | ||||||||||
|
Operating Income (Loss):
|
||||||||||||||||||
|
Chicken
|
$ | 114 | $ | (46 | ) | $ | 192 | $ | (332 | ) | ||||||||
|
Beef
|
126 | 28 | 245 | 28 | ||||||||||||||
|
Pork
|
69 | 29 | 131 | 84 | ||||||||||||||
|
Prepared Foods
|
37 | 19 |
(a)
|
92 | 54 |
(a)
|
||||||||||||
|
Other
|
(2 | ) | (1 | ) | (2 | ) | (3 | ) | ||||||||||
|
Total Operating Income (Loss)
|
344 | 29 | 658 | (169 | ) | |||||||||||||
|
Other Expense
|
95 | 76 | 173 | 157 | ||||||||||||||
|
Income (Loss) from Continuing Operations
|
||||||||||||||||||
|
before Income Taxes
|
$ | 249 | $ | (47 | ) | $ | 485 | $ | (326 | ) | ||||||||
|
(a)
|
Includes $15 million charge related to the closing of our Ponca City, Oklahoma, processed meats plant.
|
|
Overview
|
|||
|
●
|
General – All of our core businesses had increased operating results for the six months ended April 3, 2010, as compared to the same period last year, as a result of improved internal performance and a better market environment. The following are a few of the key drivers:
|
||
|
●
|
We had operational efficiency improvements of approximately $400 million. The operational efficiencies occurred in the areas of yields, cost reduction, labor management, logistics cost optimization, capacity, live bird operations (including livability, feed conversion, and net to processing improvements).
|
||
|
●
|
We achieved margin management gains year-to-date compared to the prior year of approximately $250 million. Margin management improvements occurred in the areas of mix, export sales, price optimization and value-added products initiatives.
|
||
|
●
|
Tyson and the meat industry in general have benefitted from improving domestic market conditions. For the first time in 40 years, industry forecasters predict a reduction in available protein in two consecutive years. This is a factor of reduced protein production, fewer imports, increased exports and reduced freezer inventories. Poor industry results for 2008 and 2009 led to a reduction in industry capacity and a better balance between overall meat products’ supply and demand. While the recent economic conditions have caused decreased demand at foodservice establishments, most of the lost demand has shifted to retailers as consumers are choosing to eat at home. As the economy shows some signs of strengthening, we have seen some improvement in foodservice demand.
|
||
|
●
|
Chicken Segment – Second quarter fiscal 2010 operating income was $114 million, or a 4.6% operating margin, an improvement of $36 million as compared to the first quarter fiscal 2010. The improvement was largely due to lower grain costs and continued operational efficiencies.
|
||
|
●
|
Beef Segment – Operating income was $126 million, or a 4.6% operating margin. We have continued our focus on production efficiencies, customer service and product quality, which combined with the increase in export sales, resulted in improved margins.
|
||
|
●
|
Pork Segment – Our pork plants continued to operate at high efficiency levels, which along with maximizing our revenues relative to live costs, led to operating income of $69 million, or a 7.4% operating margin.
|
||
|
●
|
Prepared Foods Segment – Operating income was $37 million, or a 5.0% operating margin, down $18 million from the first quarter fiscal 2010. The decline was largely due to rapidly increasing raw material costs, which were partially offset by the trailing increase in average sales prices.
|
||
|
●
|
Note Repurchases and Retirements – During the first six months of fiscal 2010, we used available cash on hand and restricted cash to repurchase or retire $518 million of senior notes.
|
||
|
in millions, except per share data
|
Three Months Ended
|
Six Months Ended
|
||||||||||||||
|
April 3, 2010
|
March 28, 2009
|
April 3, 2010
|
March 28, 2009
|
|||||||||||||
|
Net income (loss) attributable to Tyson
|
$ | 159 | $ | (119 | ) | $ | 319 | $ | (221 | ) | ||||||
|
Net income (loss) attributable to Tyson – per diluted share
|
0.42 | (0.32 | ) | 0.84 | (0.59 | ) | ||||||||||
|
Second quarter and six months of fiscal 2010
– Net income attributable to Tyson included the following item:
|
||
|
●
|
$24 million charge related to losses on notes repurchased during the quarter.
|
|
|
Second quarter of fiscal 2009
– Net loss attributable to Tyson included the following item:
|
||
|
●
|
The impact of changing the method of recognizing interim income taxes.
|
|
|
Second quarter and six months of fiscal 2009
– Net loss attributable to Tyson included the following item:
|
||
|
●
|
$15 million charge related to the closing of our Ponca City, Oklahoma, processed meats plant.
|
|
|
Chicken
– We expect seasonal demand will improve as we get into the second half of fiscal 2010, and we expect the pricing environment to improve aided by cold storage inventories and pullet placements which are down relative to the levels we have seen over the last several years. We also currently expect to see grain costs down as compared to fiscal 2009. Additionally, we will continue to focus on making operational improvements to help maximize our margins.
|
|
Beef
– While we expect a reduction in cattle supplies of approximately 1% in fiscal 2010, we do not expect a significant change in the fundamentals of our Beef business as it relates to the previous few quarters. We expect adequate supplies to operate our plants. We will manage our spreads by maximizing our revenues through product mix and minimizing our operating costs, while keeping our focus on quality and customer service.
|
|
Pork
– We expect the gradual decline in hog supplies in the first half of fiscal 2010 will accelerate into the second half of fiscal 2010, resulting in industry slaughter slightly higher than 2007. However, we still believe we will have adequate supplies in the regions in which we operate. We will manage our spreads by continuing to control our costs and maximizing our revenues.
|
|
Prepared Foods
– Raw material costs will likely increase in fiscal 2010, but we have made some changes in our sales contracts that move us further away from long-term fixed price contracts toward formula or shorter-term pricing, which will better enable us to absorb rising raw material costs. However, in the third quarter fiscal 2010, we will continue to see a negative impact until some of the latest price increases take effect.
|
|
in millions
|
Three Months Ended
|
Six Months Ended
|
||||||||||||||
|
April 3, 2010
|
March 28, 2009
|
April 3, 2010
|
March 28, 2009
|
|||||||||||||
|
Sales
|
$ | 6,916 | $ | 6,307 | $ | 13,551 | $ | 12,828 | ||||||||
|
Change in sales volume
|
(0.5 | )% | 2.0 | % | ||||||||||||
|
Change in average sales price
|
10.2 | % | 3.6 | % | ||||||||||||
|
Sales growth
|
9.7 | % | 5.6 | % | ||||||||||||
|
Second quarter – Fiscal 2010 vs Fiscal 2009
|
||
|
●
|
Average Sales Price
– Sales were positively impacted by higher average sales prices in all segments, which accounted for the majority of the increase. The Beef, Pork and Prepared Foods segments increased largely due to higher live and raw material costs, while the Chicken segment increase was largely due to the change in mix resulting from a reduction in rendered and export volumes.
|
|
|
●
|
Sales Volume
– Sales volume was down slightly from the same period last year. This included a decrease in Chicken segment export sales volume, offset by an increase in sales volume related to a recent international acquisition and an increase in Beef segment sales volume.
|
|
|
Six months – Fiscal 2010 vs Fiscal 2009
|
||
|
●
|
Average Sales Price
– Sales were positively impacted by higher average sales prices, which accounted for an increase of approximately $384 million. The Beef and Pork segments increased largely due to higher live costs, while the Chicken segment increase was largely due to the change in mix resulting from a reduction in rendered and export volumes.
|
|
|
●
|
Sales Volume
– Sales were also positively impacted by higher sales volume, which accounted for an increase of approximately $339 million. This included a decrease in Chicken segment export sales volume, offset by an increase in sales volume related to a recent international acquisition and an increase in Beef segment sales volume.
|
|
|
in millions
|
Three Months Ended
|
Six Months Ended
|
||||||||||||||
|
April 3, 2010
|
March 28, 2009
|
April 3, 2010
|
March 28, 2009
|
|||||||||||||
|
Cost of sales
|
$ | 6,352 | $ | 6,054 | $ | 12,458 | $ | 12,557 | ||||||||
|
Gross margin
|
$ | 564 | $ | 253 | $ | 1,093 | $ | 271 | ||||||||
|
Cost of sales as a percentage of sales
|
91.8 | % | 96.0 | % | 91.9 | % | 97.9 | % | ||||||||
|
Second quarter – Fiscal 2010 vs Fiscal 2009
|
|||
|
●
|
Cost of sales increased $298 million. Higher cost per pound was the primary reason for the increase in cost of sales and included the following changes:
|
||
|
●
|
Increase in average live cattle and hog costs of approximately $178 million.
|
||
|
●
|
Increase due to net losses of $40 million in the second quarter of fiscal 2010, as compared to net gains of $54 million in the second quarter of fiscal 2009, from our commodity risk management activities related to forward futures contracts for live cattle and hogs, and excludes the impact from related physical purchase transactions which impact current and future period operating results.
|
||
|
●
|
Decrease due to net losses of $63 million in the second quarter of fiscal 2009, from our commodity risk management activities related to grain and energy purchases, and excludes the impact from related physical purchase transactions which impact current and future period operating results.
|
||
|
Six months – Fiscal 2010 vs Fiscal 2009
|
|||
|
●
|
Cost of sales decreased $99 million. Lower cost per pound reduced cost of sales $430 million, offset partially by higher sales volume which increased cost of sales $331 million.
|
||
|
●
|
Decrease due to net gains of $1 million in the six months of fiscal 2010, as compared to net losses of $251 million in the six months of fiscal 2009, from our commodity risk management activities related to grain and energy purchases, and excludes the impact from related physical purchase transactions which impact current and future period operating results.
|
||
|
●
|
Decrease in average live cattle costs of approximately $142 million.
|
||
|
●
|
Decrease in grain costs in the Chicken segment of approximately $65 million.
|
||
|
●
|
Increase due to net losses of $49 million in the six months of fiscal 2010, as compared to net gains of $148 million in the six months of fiscal 2009, from our commodity risk management activities related to forward futures contracts for live cattle and hogs, and excludes the impact from related physical purchase transactions which impact current and future period operating results.
|
||
|
in millions
|
Three Months Ended
|
Six Months Ended
|
||||||||||||||
|
April 3, 2010
|
March 28, 2009
|
April 3, 2010
|
March 28, 2009
|
|||||||||||||
|
Selling, general and administrative expense
|
$ | 220 | $ | 209 | $ | 435 | $ | 425 | ||||||||
|
As a percentage of sales
|
3.2 | % | 3.3 | % | 3.2 | % | 3.3 | % | ||||||||
|
Second quarter – Fiscal 2010 vs Fiscal 2009
|
||
|
●
|
Increase of $24 million related to incentive-based compensation.
|
|
|
●
|
Decrease of $5 million related to the change in investment returns on company-owned life insurance, which is used to fund non-qualified retirement plans.
|
|
|
●
|
Decrease of $5 million related to advertising and sales promotions.
|
|
|
Six months – Fiscal 2010 vs Fiscal 2009
|
||
|
●
|
Increase of $46 million related to incentive-based compensation.
|
|
|
●
|
Decrease of $21 million related to the change in investment returns on company-owned life insurance, which is used to fund non-qualified retirement plans.
|
|
|
●
|
Decrease of $9 million related to advertising and sales promotions.
|
|
|
in millions
|
Three Months Ended
|
Six Months Ended
|
||||||||||||||
|
April 3, 2010
|
March 28, 2009
|
April 3, 2010
|
March 28, 2009
|
|||||||||||||
|
Cash interest expense
|
$ | 64 | $ | 62 | $ | 136 | $ | 121 | ||||||||
|
Losses on notes repurchased
|
24 | - | 25 | - | ||||||||||||
|
Non-cash interest expense
|
12 | 16 | 19 | 24 | ||||||||||||
|
Total Interest Expense
|
$ | 100 | $ | 78 | $ | 180 | $ | 145 | ||||||||
|
Second quarter – Fiscal 2010 vs Fiscal 2009
|
||
|
●
|
Cash interest expense includes interest expense related to the coupon rates for senior notes and commitment/letter of credit fees incurred on our revolving credit facilities. The increase is due to an increase in the overall average borrowing rates, partially offset by lower average weekly indebtedness of approximately 4%.
|
|
|
●
|
Losses on notes repurchased during the second quarter fiscal 2010 included the amount paid exceeding the face value, which primarily included the repurchases of the 8.25% Notes due October 2011 (2011 Notes) and the 7.85% Notes due April 2016 (2016 Notes).
|
|
|
●
|
Non-cash interest expense primarily includes interest related to the amortization of debt issuance costs and discounts/premiums on note issuances. This includes debt issuance costs incurred on the new credit facility in March 2009 and the 10.5% Senior Notes due 2014 (2014 Notes) issued in March 2009, as well as the accretion of the debt discount on the 3.25% Convertible Senior Notes due 2013 (2013 Notes) and 2014 Notes. Fiscal 2009 also includes expenses related to amendment fees paid in December 2008 on our then existing credit agreements.
|
|
|
Six months – Fiscal 2010 vs Fiscal 2009
|
||
|
●
|
Cash interest expense includes interest expense related to the coupon rates for senior notes and commitment/letter of credit fees incurred on our revolving credit facilities. The increase is due to an increase in the overall average borrowing rates, as well as higher average weekly indebtedness of approximately 2%.
|
|
|
●
|
Losses on notes repurchased during the six months ended April 3, 2010, included the amount paid exceeding the face value, which primarily included the repurchases of the 2011 Notes and the 2016 Notes.
|
|
|
●
|
Non-cash interest expense primarily includes interest related to the amortization of debt issuance costs and discounts/premiums on note issuances. This includes debt issuance costs incurred on the new credit facility in March 2009 and the 2014 Notes issued in March 2009, as well as the accretion of the debt discount on the 2013 Notes and 2014 Notes. Fiscal 2009 also includes expenses related to amendment fees paid in December 2008 on our then existing credit agreements.
|
|
|
in millions
|
Three Months Ended
|
Six Months Ended
|
||||||||||||||
|
April 3, 2010
|
March 28, 2009
|
April 3, 2010
|
March 28, 2009
|
|||||||||||||
| $ | (1 | ) | $ | 3 | $ | - | $ | 21 | ||||||||
|
Six months of fiscal 2009:
|
||
|
●
|
Included $19 million in foreign currency exchange loss.
|
|
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
|
April 3, 2010
|
March 28, 2009
|
April 3, 2010
|
March 28, 2009
|
|||||||||||||
| 37.1 | % | (122.2 | )% | 35.0 | % | 34.1 | % | |||||||||
|
Second quarter of fiscal 2010
– The effective tax rate was impacted by:
|
||
|
●
|
state income taxes;
|
|
|
●
|
losses in foreign jurisdictions and related valuation allowances;
|
|
|
●
|
the domestic production deduction; and
|
|
|
●
|
general business credits.
|
|
|
Six months of fiscal 2010
– The effective tax rate was impacted by:
|
||
|
●
|
state income taxes;
|
|
|
●
|
losses in foreign jurisdictions and related valuation allowances;
|
|
|
●
|
the domestic production deduction;
|
|
|
●
|
general business credits; and
|
|
|
●
|
adjustments to uncertain tax positions due to tax audit resolutions and statute expirations.
|
|
|
Second quarter and six months of fiscal 2009
– The effective tax rate was impacted by:
|
||
|
●
|
the change in method from estimated annual to year-to-date;
|
|
|
●
|
tax planning in foreign jurisdictions;
|
|
|
●
|
general business credits;
|
|
|
●
|
amounts relating to company-owned life insurance and certain other nondeductible expense items; and
|
|
|
●
|
state and foreign valuation allowances.
|
|
|
in millions
|
Sales
|
|||||||||||||||
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
|
April 3, 2010
|
March 28, 2009
|
April 3, 2010
|
March 28, 2009
|
|||||||||||||
|
Chicken
|
$ | 2,491 | $ | 2,360 | $ | 4,916 | $ | 4,594 | ||||||||
|
Beef
|
2,762 | 2,419 | 5,444 | 5,082 | ||||||||||||
|
Pork
|
929 | 844 | 1,744 | 1,722 | ||||||||||||
|
Prepared Foods
|
734 | 684 | 1,447 | 1,430 | ||||||||||||
|
Total
|
$ | 6,916 | $ | 6,307 | $ | 13,551 | $ | 12,828 | ||||||||
|
in millions
|
Operating Income (Loss)
|
|||||||||||||||
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
|
April 3, 2010
|
March 28, 2009
|
April 3, 2010
|
March 28, 2009
|
|||||||||||||
|
Chicken
|
$ | 114 | $ | (46 | ) | $ | 192 | $ | (332 | ) | ||||||
|
Beef
|
126 | 28 | 245 | 28 | ||||||||||||
|
Pork
|
69 | 29 | 131 | 84 | ||||||||||||
|
Prepared Foods
|
37 | 19 | 92 | 54 | ||||||||||||
|
Other
|
(2 | ) | (1 | ) | (2 | ) | (3 | ) | ||||||||
|
Total
|
$ | 344 | $ | 29 | $ | 658 | $ | (169 | ) | |||||||
|
in millions
|
Three Months Ended
|
Six Months Ended
|
||||||||||||||||||||||
|
April 3, 2010
|
March 28, 2009
|
Change
|
April 3, 2010
|
March 28, 2009
|
Change
|
|||||||||||||||||||
|
Sales
|
$ | 2,491 | $ | 2,360 | $ | 131 | $ | 4,916 | $ | 4,594 | $ | 322 | ||||||||||||
|
Sales Volume Change
|
(4.3 | )% | 0.4 | % | ||||||||||||||||||||
|
Average Sales Price Change
|
10.2 | % | 6.6 | % | ||||||||||||||||||||
|
Operating Income (Loss)
|
$ | 114 | $ | (46 | ) | $ | 160 | $ | 192 | $ | (332 | ) | $ | 524 | ||||||||||
|
Operating Margin
|
4.6 | % | (1.9 | )% | 3.9 | % | (7.2 | )% | ||||||||||||||||
|
Second quarter and six months – Fiscal 2010 vs Fiscal 2009
|
|||
|
●
|
Sales volume decreased due to reduced sales of rendered product and export sales, which was partially offset by increased sales volume related to an international acquisition. Despite the decreased sales volumes, overall sales increased due to an increase in the average sales price, which primarily resulted from sales mix changes associated with the reduced sales of the lower price per pound rendered and export products.
|
||
|
●
|
Operating Income (Loss) –
|
||
|
●
|
Operational Improvements – Operating results were positively impacted by operational improvements, which included: yield, mix and live production performance improvements; additional processing flexibility; and reduced interplant product movement.
|
||
|
●
|
Derivative Activities – Operating results included the following amounts for commodity risk management activities related to grain and energy purchases. These amounts exclude the impact from related physical purchase transactions, which impact current and future period operating results.
|
||
|
Income/(Loss) - in millions
|
Qtr
|
YTD
|
||||||
|
2010
|
$ | - | $ | 1 | ||||
|
2009
|
(63 | ) | (251 | ) | ||||
|
Improvement in operating results
|
$ | 63 | $ | 252 | ||||
|
●
|
Grain Costs – As compared to the same periods of fiscal 2009, operating results were negatively impacted in the second quarter of fiscal 2010 by an increase in grain costs of $19 million and were positively impacted in the first six months of fiscal 2010 by a decrease in grain costs of $65 million.
|
|
in millions
|
Three Months Ended
|
Six Months Ended
|
||||||||||||||||||||||
|
April 3, 2010
|
March 28, 2009
|
Change
|
April 3, 2010
|
March 28, 2009
|
Change
|
|||||||||||||||||||
|
Sales
|
$ | 2,762 | $ | 2,419 | $ | 343 | $ | 5,444 | $ | 5,082 | $ | 362 | ||||||||||||
|
Sales Volume Change
|
5.4 | % | 6.3 | % | ||||||||||||||||||||
|
Average Sales Price Change
|
8.4 | % | 0.8 | % | ||||||||||||||||||||
|
Operating Income
|
$ | 126 | $ | 28 | $ | 98 | $ | 245 | $ | 28 | $ | 217 | ||||||||||||
|
Operating Margin
|
4.6 | % | 1.2 | % | 4.5 | % | 0.6 | % | ||||||||||||||||
|
Second quarter and six months – Fiscal 2010 vs Fiscal 2009
|
|||
|
●
|
Sales and Operating Income –
|
||
|
●
|
We increased our operating margins by maximizing our revenues relative to live cattle markets, as well as improved our operating costs.
|
||
|
●
|
Our sales were also positively impacted by an increase in our export sales volume.
|
||
|
●
|
Derivative Activities – Operating results included the following amounts for commodity risk management activities related to forward futures contracts for live cattle. These amounts exclude the impact from related physical sale and purchase transactions, which impact current and future period operating results.
|
||
|
Income/(Loss) - in millions
|
Qtr
|
YTD
|
||||||
|
2010
|
$ | (4 | ) | $ | 2 | |||
|
2009
|
34 | 90 | ||||||
|
Decline in operating results
|
$ | (38 | ) | $ | (88 | ) | ||
|
in millions
|
Three Months Ended
|
Six Months Ended
|
||||||||||||||||||||||
|
April 3, 2010
|
March 28, 2009
|
Change
|
April 3, 2010
|
March 28, 2009
|
Change
|
|||||||||||||||||||
|
Sales
|
$ | 929 | $ | 844 | $ | 85 | $ | 1,744 | $ | 1,722 | $ | 22 | ||||||||||||
|
Sales Volume Change
|
(4.3 | )% | (2.7 | )% | ||||||||||||||||||||
|
Average Sales Price Change
|
15.0 | % | 4.1 | % | ||||||||||||||||||||
|
Operating Income
|
$ | 69 | $ | 29 | $ | 40 | $ | 131 | $ | 84 | $ | 47 | ||||||||||||
|
Operating Margin
|
7.4 | % | 3.4 | % | 7.5 | % | 4.9 | % | ||||||||||||||||
|
Second quarter and six months – Fiscal 2010 vs Fiscal 2009
|
|||
|
●
|
Sales and Operating Income –
|
||
|
●
|
We increased our operating margins by maximizing our revenues relative to live hog markets, as well as improved our operating costs.
|
||
|
●
|
Derivative Activities – Operating results included the following amounts for commodity risk management activities related to forward futures contracts for live hogs. These amounts exclude the impact from related physical sale and purchase transactions, which impact current and future period operating results.
|
||
|
Income/(Loss) - in millions
|
Qtr
|
YTD
|
||||||
|
2010
|
$ | (22 | ) | $ | (29 | ) | ||
|
2009
|
13 | 36 | ||||||
|
Decline in operating results
|
$ | (35 | ) | $ | (65 | ) | ||
|
in millions
|
Three Months Ended
|
Six Months Ended
|
||||||||||||||||||||||
|
April 3, 2010
|
March 28, 2009
|
Change
|
April 3, 2010
|
March 28, 2009
|
Change
|
|||||||||||||||||||
|
Sales
|
$ | 734 | $ | 684 | $ | 50 | $ | 1,447 | $ | 1,430 | $ | 17 | ||||||||||||
|
Sales Volume Change
|
5.6 | % | 3.5 | % | ||||||||||||||||||||
|
Average Sales Price Change
|
1.7 | % | (2.2 | )% | ||||||||||||||||||||
|
Operating Income
|
$ | 37 | $ | 19 | $ | 18 | $ | 92 | $ | 54 | $ | 38 | ||||||||||||
|
Operating Margin
|
5.0 | % | 2.8 | % | 6.4 | % | 3.8 | % | ||||||||||||||||
|
Second quarter and six months of fiscal 2009
|
||
|
●
|
Includes $15 million charge related to the closing of our Ponca City, Oklahoma, processed meats plant.
|
|
|
Second quarter and six months – Fiscal 2010 vs Fiscal 2009
|
||
|
●
|
Operating income improved in the second quarter fiscal 2010 as compared to the same period last year due to an increase in sales volume and average sales prices, offset by an increase in raw material costs. Operating income improved in the first six months of fiscal 2010 as compared to the same period last year due to an increase in sales volume, offset by a decrease in average sales prices. In addition, we made several operational improvements in late fiscal 2009 that allow us to run our plants more efficiently. In the first six months of fiscal 2010, we received $8 million in insurance proceeds related to the flood damage at our Jefferson, Wisconsin, plant.
|
|
|
in millions
|
Six Months Ended
|
|||||||
|
April 3, 2010
|
March 28, 2009
|
|||||||
|
Net income (loss)
|
$ | 315 | $ | (223 | ) | |||
|
Non-cash items in net income (loss):
|
||||||||
|
Depreciation and amortization
|
247 | 253 | ||||||
|
Deferred income taxes
|
1 | (78 | ) | |||||
|
Other, net
|
47 | 88 | ||||||
|
Changes in working capital
|
(111 | ) | 367 | |||||
|
Net cash provided by operating activities
|
$ | 499 | $ | 407 | ||||
|
Cash flows associated with changes in working capital for the six months ended:
|
||
|
●
|
April 3, 2010
– Decreased primarily due to higher inventory and accounts receivable balances, a decrease in trade accounts payable and income tax payables, partially offset by an increase in accrued salaries, wages and benefits.
|
|
|
●
|
March 28, 2009
– Increased due to lower inventory and accounts receivable balances, partially offset by lower trade accounts payable and the change in income tax receivable/payable balances.
|
|
|
in millions
|
Six Months Ended
|
|||||||
|
April 3, 2010
|
March 28, 2009
|
|||||||
|
Additions to property, plant and equipment
|
$ | (264 | ) | $ | (160 | ) | ||
|
Proceeds from sale (purchases) of marketable securities, net
|
(4 | ) | 12 | |||||
|
Acquisitions, net of cash acquired
|
- | (76 | ) | |||||
|
Proceeds from sale of discontinued operation
|
- | 43 | ||||||
|
Change in restricted cash to be used for investing activities
|
43 | (76 | ) | |||||
|
Other, net
|
(2 | ) | 20 | |||||
|
Net cash used for investing activities
|
$ | (227 | ) | $ | (237 | ) | ||
|
●
|
Additions to property, plant and equipment include acquiring new equipment, upgrading our facilities to maintain competitive standing and positioning us for future opportunities.
|
|||
|
●
|
Capital spending for fiscal 2010 is expected to be approximately $700 million, and includes:
|
|||
|
●
|
approximately $630 million on current core business and foreign capital spending; and
|
|||
|
●
|
approximately $70 million related to Dynamic Fuels LLC (Dynamic Fuels), most of which relates to the completion of Dynamic Fuels’ first facility. Construction of this facility is expected to continue into the third quarter of fiscal 2010, with production targeted soon thereafter. During the first six months of fiscal 2010, we used the remaining $43 million of our restricted cash for spending on this facility. During the first six months of fiscal 2009, we used $23 million of our restricted cash for spending on this facility.
|
|||
|
●
|
Acquisitions – In October 2008, we acquired three vertically integrated poultry companies in southern Brazil. The aggregate purchase price was $67 million, which included $17 million of mandatory deferred payments, of which $4 million remains to be paid through 2011. In addition, we have $16 million of contingent purchase price based on production volumes.
|
|||
|
in millions
|
Six Months Ended
|
|||||||
|
April 3, 2010
|
March 28, 2009
|
|||||||
|
Net payments on revolving credit facilities
|
$ | - | $ | (2 | ) | |||
|
Payments on debt
|
(555 | ) | (51 | ) | ||||
|
Proceeds from borrowings of debt
|
15 | 851 | ||||||
|
Debt issuance costs
|
- | (58 | ) | |||||
|
Change in restricted cash to be used for financing activities
|
140 | (234 | ) | |||||
|
Purchases of treasury shares
|
(31 | ) | (4 | ) | ||||
|
Dividends
|
(30 | ) | (30 | ) | ||||
|
Change in negative book cash balances
|
(13 | ) | (90 | ) | ||||
|
Stock options exercised and other, net
|
15 | 4 | ||||||
|
Net cash provided by (used for) financing activities
|
$ | (459 | ) | $ | 386 | |||
|
●
|
Payments on debt for the six months ended April 3, 2010, included:
|
||
|
●
|
$287 million of 2011 Notes;
|
||
|
●
|
$140 million of 7.95% Notes due February 2010 (using the restricted cash held in a blocked cash collateral account for the repurchase of these notes);
|
||
|
●
|
$57 million of 2016 Notes;
|
||
|
●
|
$34 million of 7.0% Notes due May 2018; and
|
||
|
●
|
$25 million related to the losses on notes repurchased during the period.
|
||
|
●
|
Proceeds from borrowings of debt for the six months ended March 28, 2009, included:
|
||
|
●
|
In March 2009, we issued $810 million of 2014 Notes. After the original issue discount of $59 million, based on an issue price of 92.756% of face value, we received net proceeds of $751 million. We used the net proceeds towards the repayment of our borrowings under the accounts receivable securitization facility and for other general corporate purposes.
|
||
|
●
|
In October 2008, Dynamic Fuels received $100 million in proceeds from the sale of Gulf Opportunity Zone tax-exempt bonds made available by the Federal government to the regions affected by Hurricanes Katrina and Rita in 2005. These floating rate bonds are due October 1, 2033.
|
||
|
in millions
|
|||||||||||||||||||||
|
Borrowing
|
Outstanding
|
||||||||||||||||||||
|
Commitments
|
Facility
|
Base
|
Letters of Credit
|
Amount
|
Amount
|
||||||||||||||||
|
Expiration Date
|
Amount
|
Adjustment
|
(no draw downs)
|
Borrowed
|
Available
|
||||||||||||||||
|
Cash and cash equivalents
|
$ | 812 | |||||||||||||||||||
|
Revolving credit facility
|
March 2012
|
$ | 1,000 | $ | - | $ | (228 | ) | $ | - | $ | 772 | |||||||||
|
Total liquidity
|
$ | 1,584 | |||||||||||||||||||
|
●
|
The revolving credit facility supports our short-term funding needs and letters of credit. Letters of credit are issued primarily in support of workers’ compensation insurance programs, derivative activities and Dynamic Fuels’ Gulf Opportunity Zone tax-exempt bonds.
|
||
|
●
|
Borrowing Base Adjustment – Availability under this facility, up to $1.0 billion, is based on a percentage of certain eligible accounts receivable and eligible inventory and is reduced by certain reserves. At April 3, 2010, the entire $1.0 billion was eligible for borrowing and issuing letters of credit.
|
||
|
●
|
Our 2013 Notes may be converted early during any fiscal quarter in the event our Class A stock trades at or above $21.96 for at least 20 trading days during a period of 30 consecutive trading days ending on the last trading day of the preceding fiscal quarter. In this event, the note holders may require us to pay outstanding principal in cash, which totaled $458 million at April 3, 2010. Any conversion premium would be paid in shares of Class A common stock. The conditions for early conversion were not met in our second fiscal quarter of fiscal 2010, and thus, the notes may not be converted in our third quarter fiscal 2010. Should the conditions for early conversion be reached in future quarters, and the holders exercised their early conversion option, we would use current cash on hand and cash flow from operations for principal payments.
|
||
|
●
|
At April 3, 2010, we had $552 million of 2011 Notes outstanding. We plan presently to use current cash on hand and cash flows from operations for payment on the remaining 2011 Notes due in October 2011.
|
||
|
●
|
Our current ratio was 2.21 to 1 and 2.20 to 1 at April 3, 2010, and October 3, 2009, respectively.
|
||
|
in millions
|
||||||||
|
April 3, 2010
|
October 3, 2009
|
|||||||
|
Senior Notes
|
$ | 2,743 | $ | 3,248 | ||||
|
Other indebtedness
|
236 | 229 | ||||||
|
Total Debt
|
$ | 2,979 | $ | 3,477 | ||||
|
Total Shareholders’ Equity
|
$ | 4,723 | $ | 4,431 | ||||
|
Debt to Capitalization Ratio
|
38.7 | % | 44.0 | % | ||||
|
●
|
At April 3, 2010, we had $812 million of cash and cash equivalents.
|
|
Effect of 10% change in fair value
|
||||||||
|
in millions
|
April 3, 2010
|
October 3, 2009
|
||||||
|
Livestock:
|
||||||||
|
Cattle
|
$ | 41 | $ | 20 | ||||
|
Hogs
|
21 | 12 | ||||||
|
Grain
|
2 | 1 | ||||||
|
Period
|
Total Number of Shares Purchased
|
Average Price Paid per Share
|
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
|
Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs (1)
|
||||||||||||||||
|
Jan. 3, 2010 to Jan. 30, 2010
|
222,592 | $ | 13.15 | - | 22,474,439 | |||||||||||||||
|
Jan. 31, 2010 to March 6, 2010
|
358,250 | 15.72 | - | 22,474,439 | ||||||||||||||||
|
March 7, 2010 to April 3, 2010
|
284,800 | 17.88 | - | 22,474,439 | ||||||||||||||||
|
Total
|
(2 | ) | 865,642 | $ | 15.77 | - | 22,474,439 | |||||||||||||
|
(1)
|
On February 7, 2003, we announced our board of directors approved a plan to repurchase up to 25 million shares of Class A common stock from time to time in open market or privately negotiated transactions. The plan has no fixed or scheduled termination date.
|
|
(2)
|
We purchased 865,642 shares during the period that were not made pursuant to our previously announced stock repurchase plan, but were purchased to fund certain company obligations under our equity compensation plans. These transactions included 731,334 shares purchased in open market transactions and 134,308 shares withheld to cover required tax withholdings on the vesting of restricted stock.
|
|
(i)
|
With respect to the election of the slate of directors chosen by the board:
|
|
Votes For
|
922,983,370 | |||
|
Votes Against
|
0 | |||
|
Votes Abstained
|
3,183,487 | |||
|
Broker Non-Votes
|
31,788,856 |
|
Directors
|
Votes For
|
Votes Withheld
|
||||||
|
Don Tyson
|
919,695,651 | 6,471,206 | ||||||
|
John Tyson
|
918,210,182 | 7,956,676 | ||||||
|
Lloyd V. Hackley
|
833,715,634 | 92,451,223 | ||||||
|
Jim Kever
|
917,343,826 | 8,823,031 | ||||||
|
Kevin M. McNamara
|
833,817,008 | 92,349,849 | ||||||
|
Brad T. Sauer
|
826,040,955 | 100,125,902 | ||||||
|
Robert Thurber
|
833,746,632 | 92,420,225 | ||||||
|
Barbara A. Tyson
|
917,654,631 | 8,512,226 | ||||||
|
Albert C. Zapanta
|
921,886,992 | 4,279,865 | ||||||
|
(ii)
|
Reapproval of the annual incentive compensation plan for senior executive officers:
|
|
Votes For
|
916,614,328 | |||
|
Votes Against
|
9,179,053 | |||
|
Votes Abstained
|
373,474 | |||
|
Broker Non-Votes
|
31,788,856 |
|
(iii)
|
Ratification of the selection of PwC:
|
|
Votes For
|
956,600,161 | |||
|
Votes Against
|
1,173,517 | |||
|
Votes Abstained
|
182,032 |
|
(iv)
|
Proposal 1:
|
|
Votes For
|
86,154,949 | |||
|
Votes Against
|
774,880,968 | |||
|
Votes Abstained
|
65,130,937 | |||
|
Broker Non-Votes
|
31,788,856 |
|
(v)
|
Proposal 2:
|
|
Votes For
|
72,309,059 | |||
|
Votes Against
|
786,487,650 | |||
|
Votes Abstained
|
67,370,146 | |||
|
Broker Non-Votes
|
31,788,856 |
|
(vi)
|
Proposal 3:
|
|
Votes For
|
7,565,667 | |||
|
Votes Against
|
857,499,865 | |||
|
Votes Abstained
|
61,101,324 | |||
|
Broker Non-Votes
|
31,788,856 |
|
Exhibit No.
|
Exhibit Description
|
|
|
10.1
|
Voluntary Separation Agreement and General Release between the Company and Richard A. Greubel, Jr., dated February 8, 2010.
|
|
|
12.1
|
Calculation of Ratio of Earnings to Fixed Charges
|
|
|
31.1
|
Certification of Chief Executive Officer pursuant to SEC Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
31.2
|
Certification of Chief Financial Officer pursuant to SEC Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
32.1
|
Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
32.2
|
Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
Date: May 10, 2010
|
/s/ Dennis Leatherby
|
||||
|
Dennis Leatherby
|
|||||
|
Executive Vice President and Chief
|
|||||
|
Financial Officer
|
|||||
|
Date: May 10, 2010
|
/s/ Craig J. Hart
|
||||
|
Craig J. Hart
|
|||||
|
Senior Vice President, Controller and
|
|||||
|
Chief Accounting Officer
|
|||||
No information found
* THE VALUE IS THE MARKET VALUE AS OF THE LAST DAY OF THE QUARTER FOR WHICH THE 13F WAS FILED.
| FUND | NUMBER OF SHARES | VALUE ($) | PUT OR CALL |
|---|
| DIRECTORS | AGE | BIO | OTHER DIRECTOR MEMBERSHIPS |
|---|
No information found
Customers
| Customer name | Ticker |
|---|---|
| Herman Miller, Inc. | MLHR |
| HNI Corporation | HNI |
| L Brands, Inc. | LB |
| Steelcase Inc. | SCS |
| Walmart Inc. | WMT |
Suppliers
| Supplier name | Ticker |
|---|---|
| Thermo Fisher Scientific Inc. | TMO |
| McCormick & Company, Incorporated | MKC |
| The Kraft Heinz Company | KHC |
| TreeHouse Foods, Inc. | THS |
| Dover Corporation | DOV |
Price
Yield
| Owner | Position | Direct Shares | Indirect Shares |
|---|