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Tyson misses profit estimates, shares fall

Mon Nov 10, 2008 11:32pm IST
 
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By Bob Burgdorfer

CHICAGO (Reuters) - A $91 million operating loss in Tyson Foods Inc's (TSN.N: Quote, Profile, Research) chicken business plus a forecast that the company will "most likely" post a loss for the current quarter sent shares of the U.S. meat giant lower on Monday.

The company reported a smaller-than-expected fourth-quarter profit on Monday, due to better beef and pork results, but it was the outlook for more losses in chicken and a possible overall loss that had investors selling shares, analysts said.

"It will be a negative quarter in chicken and most likely a negative quarter overall for our results," Tyson Chief Executive Richard Bond said of the current quarter, which ends in December.

Wall Street analysts on average had expected a $41.7 million profit for the fiscal first quarter, according to Reuters Estimates.

Tyson and other chicken producers have been hurt this year by higher feed costs and the inability to raise chicken prices fast enough to offset those costs.

"Given where leg quarter prices are and breast meat prices are, we are going to lose some significant dollars in Q1," Bond told analysts on a conference call.

MORE CHICKEN REDUCTIONS NEEDED

Tyson would not say if it will cut chicken production from current levels, as other producers have done, but said more reductions by the industry may be needed to bring supplies in line with demand.  Continued...

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