Tyson Foods, Inc. · NYSE:TSN
Tyson Foods — Q4 2021 Earnings Presentation
26 slides from Tyson Foods's earnings presentation, Nov 15, 2021
Slide 1: Q4 Fiscal 2021 Supplemental Information
— Q4 Fiscal 2021 Supplemental Information November 15, 2021
Slide 2: Forward-Looking Statements
Certain information in this report constitutes forward-looking statements as contemplated by the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include, but are not limited to, current views and estimates of our outlook for fiscal 2021, other future economic circum
Slide 3: Solid finish to the fiscal year propelled by strong demand and portfolio diversity
Solid finish to the fiscal year propelled by strong demand and portfolio diversity 1 Diverse portfolio delivered double digit adjusted sales1 and earnings growth 2 Our retail core business lines gained share as demand remained elevated 3 Continued foodservice volume recovery led by QSRs 4 Deleveragi
Slide 4: Delivered double digit adjusted sales and earnings growth
Delivered double digit adjusted sales1 and earnings growth Adjusted Sales1 Adjusted Operating Income1 Adjusted Earnings Per Share1 20% 4Q21 vs. 4Q201 26% 35% 4Q21 vs. 4Q20 4Q21 vs. 4Q20 11% 42% 53% FY21 vs. FY201 FY21 vs. FY20 FY21 vs. FY20 Our Priorities 1| Win with customers and consumers 2| Win w
Slide 5: Deliberate actions underway to increase volumes
Deliberate actions underway to increase volumes Volume1 (billion pounds) Chicken Prepared Foods International / Other 12.8 12.6 12.4 3.8 3.7 3.5 1.4 1.4 1.0 2 FY2019 FY2020 FY2021 FY2019 FY2020 2 FY2021 2 FY2019 FY2020 FY2021 Beef Pork Improving capacity utilization Investing in capacity expansion A
Slide 6: Making investments toward becoming the most sought-after place to work
Making investments toward becoming the most sought-after place to work Objectives 1 2 3 Health, safety and well- Competitive wage and Investing in automation and being resources benefit offerings technology Actions Required all U.S. team members to Supporting flexible scheduling and Making strategic
Slide 7: Productivity is a critical enabler of our future success
Productivity is a critical enabler of our future success New Program Management Office to oversee execution supported by culture of continuous improvement and entrepreneurship Operational & Functional Digital Solutions Automation Excellence and Agility $1B+ — Targeted productivity $300M+ $250M+ $450
Slide 8: Growing confidence in the turnaround for the Chicken segment
Growing confidence in the turnaround for the Chicken segment Objectives Improve operational Be the employer of choice Serve our customers performance Actions Mandated vaccination to protect Deployed new male to regain Adding fully cooked capacity through team members and their competitive hatch line
Slide 9: Focused on strengthening our position as a global protein leader
Focused on strengthening our position as a global protein leader 1 Transforming and wellness our team member experience, starting with health, safety, 2 Outpacing the market by enhancing our portfolio and capacity to serve demand growth for our customers and consumers 3 Aggressively restoring our co
Slide 10: Strong total company performance in a challenging year
Strong total company performance in a challenging year Fourth Quarter and FY 2021 vs Comparable Periods ADJUSTED SALES1 ADJUSTED OPERATING INCOME1 ADJUSTED EPS1 (in millions of dollars) (in millions of dollars) (in dollars per share) $47,049 $8.28 $42,366 $4,288 +11% +42% +53% $3,010 $5.42 $12,811 $
Slide 11: Adjusted sales increased across all business segments
Adjusted sales3 increased across all business segments FY 2021 $ millions Highlights $169 -$5241 • Retail contributed over $1 billion $1,247 $47,049 in sales improvement in FY 21 and over $300 million in 4Q21 $2,563 • Foodservice sales improved Retail $1.6 billion in FY 21 compared to the same perio
Slide 12: Earnings increased driven by strength in Beef and partial recovery of inflationary pressures
Earnings increased driven by strength in Beef and partial recovery of inflationary pressures FY 2021 Highlights $ millions $5,599 - $4,598 • Volumes were slightly down in FY21 due primarily to labor challenges • Price/mix benefitted substantially due to strength in Beef and inflation justified prici
Slide 13: Consumer demand and ample cattle supply drive Beef strength
Consumer demand and ample cattle supply drive Beef strength Fourth Quarter and FY 2021 vs Comparable Periods ADJUSTED SALES1 ADJUSTED OPERATING INCOME1 HIGHLIGHTS (in millions of dollars) (in millions of dollars) • 4Q21 volume decreased due primarily to labor $17,999 challenges $3,240 $15,436 • 4Q21
Slide 14: Labor challenges impact volume and profitability in Pork
Labor challenges impact volume and profitability in Pork Fourth Quarter and FY 2021 vs Comparable Periods ADJUSTED SALES1 ADJUSTED OPERATING INCOME1 HIGHLIGHTS (in millions of dollars) (in millions of dollars) $6,277 • 4Q21 volume decreased due primarily to labor challenges $555 $5,030 +25% • 4Q21 a
Slide 15: Prepared Foods taking actions to mitigate inflationary pressure
Prepared Foods taking actions to mitigate inflationary pressure Fourth Quarter and FY 2021 vs Comparable Periods ADJUSTED SALES1 ADJUSTED OPERATING INCOME1 HIGHLIGHTS (in millions of dollars) (in millions of dollars) • 4Q21 volume decreased due primarily to $8,853 lower production throughput as a re
Slide 16: Traction in volume and price in the Chicken segment
Traction in volume and price in the Chicken segment Fourth Quarter and FY 2021 vs Comparable Periods ADJUSTED SALES1 ADJUSTED OPERATING INCOME1 HIGHLIGHTS (in millions of dollars) (in millions of dollars) • 4Q21 volume increased as production throughput $13,733 $148 improved, partially offset by lab
Slide 17: Using financial strength to invest in the business and return cash to shareholders
Using financial strength to invest in the business and return cash to shareholders Leverage Ratio OPERATING CASH FLOW (in billions of dollars) BUILD (Net Debt/Adj. EBITDA)1 2.4x FINANCIAL 2.0x STRENGTH 1.2x $3.9 $3.8 Manage leverage level to hit long-term target FY 20 FY 21 Target Capital Expenditur
Slide 18: FY 2022 Guidance
FY 2022 Guidance $49-51B +5-7% +2-3% $300-400M Sales Range Sales Growth Volume Growth Productivity Savings FY 2022 FY 2022 FY 2022 FY 2022 $2B ~23% $380M <2.0x Capital Expenditures Tax Rate Net Interest Expense Net Debt-to-EBITDA FY 2022 FY 2022 FY 2022 FY 2022 18
Slide 19: Expect solid profitability in fiscal year 2022 despite inflationary pressure
Expect solid profitability in fiscal year 2022 despite inflationary pressure Prepared Foods Beef Chicken Pork 7-9% 9-11% 5-7% 5-7% AOI Margin AOI Margin AOI Margin AOI Margin FY 2022 Range FY 2022 Range FY 2022 Range FY 2022 Range Inflation challenges first Strong profitability Restoring Improve mar
Slide 20: Investor Day
Investor Day Thursday, December 9, 2021 10:00 am – 1:00 pm EDT
Slide 21: Appendix
Appendix
Slide 22: Additional Financial Highlights
Additional Financial Highlights FY2021 ◦ Liquidity of $4.8 billion at 10/02/21 ◦ Leverage of 1.2x net debt-to-adjusted EBITDA1 ◦ Net interest expense of $420 million ◦ Effective tax rate of 24.3% ◦ Capital expenditures $1.2 billion ◦ Dividend payment of $636 million ◦ Share repurchases of $67 millio
Slide 23: EPS Reconciliations
EPS Reconciliations $ in millions, except per share data (Unaudited) Fourth Quarter Twelve Months Ended Pretax Impact EPS Impact Pretax Impact EPS Impact 2021 2020 2021 2020 2021 2020 2021 2020 Reported net income per share attributable to Tyson (GAAP EPS) $ 3.71 $ 1.79 $ 8.34 $ 5.64 Less: Defined b
Slide 24: EBITDA Reconciliations
EBITDA Reconciliations $ in millions (Unaudited) Twelve Months Ended October 2, 2021 October 3, 2020 Net Income $ 3,060 $ 2,071 Less: Interest income (8) (10) Add: Interest expense 428 485 Add: Income tax expense 981 593 Add: Depreciation 934 900 Add: Amortization1 261 278 EBITDA $ 5,656 $ 4,317 Adj
Slide 25: Segment Operating Income Reconciliations
Segment Operating Income Reconciliations $ in millions (Unaudited) Adjusted Operating Income (Loss) (for the fourth quarter ended October 2, 2021) Beef Pork Chicken Prepared Foods International/Other Total Reported operating income (loss) $ 1,147 $ 78 $ (136) $ 823 $ (3) $ 1,909 Less: Gain on sale o
Slide 26: Segment Sales and Operating Income Reconciliations
Segment Sales and Operating Income Reconciliations $ in millions (Unaudited) Adjusted Sales and Operating Income (Loss) (for the fourth quarter ended October 3, 2020) Beef Pork Chicken Prepared Foods International/Other Intersegment Total Reported Sales $ 4,272 $ 1,368 $ 3,433 $ 2,277 $ 491 $ (381)