Tyson Foods Inc. of Springdale on Monday reported $417 million loss in its fiscal third quarter, and said that it will close four chicken plants, including one in North Little Rock.
The publicly traded meat processor reported a loss of $1.18 per share. Earnings, adjusted for asset impairment costs and restructuring costs, were 15 cents per share. The company reported a $750 million profit, or $2.07 per share, in the same quarter last year.
The results did not meet Wall Street expectations. The average estimate of three analysts surveyed by Zacks Investment Research was for earnings of 34 cents per share.
The meat producer posted revenue of $13.14 billion in the period, down 2.6% from $13.49 billion in the same period last year. Tyson said it expects full-year revenue in the range of $53 billion to $54 billion.
“While current market dynamics remain challenging, Tyson Foods is fully committed to our vision of delivering sustainable, top line growth and margin improvement,” President and CEO Donnie King said in a news release. “I’m encouraged by the improvements we made this quarter, including our Tyson Core Business lines that continue to outpace our peers in volume growth.”
Shares of Tyson Foods (NYSE: TSN) were down more than 8% in pre-market trading on Monday.
Plant Closures
In a news release, the company said it will close four chicken facilities, one each in North Little Rock; Corydon, Indiana; and Dexter and Noel, Missouri. The North Little Rock plant, at 3800 E. Progress Street, will close by Oct. 7, the company said, with work performed there moved to other facilities.
King called the decision to close the plants “difficult” but said the move “demonstrates our commitment to bold action and operational excellence as we drive performance, including lower costs and improving capacity utilization, and build on our strategy of making Tyson Foods stronger in the long-term.”
In a separate statement, a Tyson spokesman said the company is working with state and local officials, including the Arkansas Division of Workforce Services, to connect employees to resources and assistance available.
The company would not say how many people work at each plant. But about 200 people worked at the North Little Rock plant in 2018, according to a Tyson news release that marked its 50th anniversary.
The St. Louis Post-Dispatch reported Monday that Tyson’s plant in Dexter employs about 600 people and the plant in Noel employed more than 1,100 in 2020.
The company expects all four chicken plants to be closed sometime in the first two quarters of fiscal 2024. Based on a preliminary analysis, it expects the financial impact of the closures to be between $300 million and $400 million.
In March, the company announced that it would close its 48-year-old poultry plant in Van Buren, affecting 969 employees, and shutter another in Glen Allen, Virginia, affecting 692 people. At the time, the company said it would shift demand to other Tyson facilities.
And in April, the company said it would eliminate 15% of its leadership positions and 10% of its corporate roles in a cost-cutting move that would simplify its corporate structure, remove duplication of work and allow it to focus on fewer initiatives with greater intensity.
Long History
Tyson Foods’ North Little Rock plant has a long history, opening in 1968 as part of Prospect Farms Inc. of North Little Rock. Tyson acquired the plant the following year, according to the 2018 news release.
“The North Little Rock plant has played a key role in the history and success of our company,” Tyson Fodos Chairman John Tyson said in 2018. “Our purchase of the plant in 1969 marked the start of our production of further-processed chicken, which became the cornerstone of our poultry business. It also enabled us to enter the food service business.”
In 2018, the North Little Rock plant was making wings, tenders and portioned fillets for national food service customers, and breaded livers, gizzards, tenders and wings for national retail customers.
As of Oct. 1, the company had 141,819 employees globally, with 123,420 employees based in the U.S. and 18,399 employees located outside of the U.S. Tyson has about 24,000 workers in Arkansas.
The Associated Press contributed information to this report.
