Tyson Foods Inc. (NYSE: TSN) is the country’s largest producer of chicken and one of the largest producers of pork and beef. Tyson Foods stock traded down more than 5% in Monday’s premarket session but was trading higher at the opening bell.

Earnings report

Tyson reported fourth fiscal quarter sales of $13.35 billion, down 2.8% year over, and a net loss of $443 million compared to a profit of $537 million in the year-ago quarter. For the full 2023 fiscal year that ended on October 1, Tyson reported a net loss of $649 million compared to net income of $4.15 billion in 2022.

Adjusted earnings per share came in more than 27% above the consensus estimate of $0.29 but were far below last year’s fourth-quarter earnings of $1.63 per share. Adjusted operating income (AOI) of $236 million fell 71% year over year. Tyson took a $333 million impairment charge in its beef segment, where AOI fell from $391 million in the year-ago quarter to $17 million.

The company’s prepared food business was a bright spot: sales rose 1.6% and AOI rose 13.7%.

To help soften the blows, the company raised its annual dividend from $1.92 per share to $1.96.

Meat sales floundering

Tyson expects challenges in the beef industry to continue in fiscal 2024. The company forecast AOI in the company’s beef segment in a range from break-even to a loss of $400 million compared to $233 million in 2023.

Tyson forecast revenue to be flat year over year. It also believes AOI will rise from $933 million in fiscal 2023 to a range of $1.0 to $1.5 billion in 2024. A $77 million  loss in the chicken segment is forecast to rise to AOI of $400 to 700 million. AOI in the pork segment is forecast to break even after posting a loss of $128 million in 2023.

The prepared foods segment posted AOI of $889 million in 2023 and next year’s forecast calls for AOI in a range of $800 million to $1 billion.

Shortly after Monday’s opening bell, Tyson Foods stock had reversed its premarket losses. The stock traded up by about 2% at $48.00 in a 52-week range of $44.94 to $68.76.

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