SPRINGDALE, ARK. — On the same day it announced its fiscal third quarter results, Tyson Foods Inc. also said the company is appointing a new chief executive officer. Dean Banks will take over as CEO of Tyson on Oct. 3. He will succeed Noel White who will remain with the company and become executive vice chairman of the board of directors.
Banks joined Tyson Foods as a director in 2017 and became president of the company in 2019. He will retain the title of president after the transition.
Banks’ background is rooted in the technology field. Before joining Tyson Foods, he was a project lead and on the leadership team at X, a business unit of Alphabet Inc. He was managing partner of SEED Ventures, a group that invested in and developed early stage health care technologies, before joining Alphabet.
“It’s clear to the board that Dean’s impressive background in entrepreneurship, technology, and the health care industry make him ideally suited to lead Tyson in its efforts to integrate advanced technologies into our operations and further our focus on team member health and safety,” said John Tyson, chairman of the board.
White joined Tyson Foods in 2001 following the company’s acquisition of IBP inc. He held a variety of senior leadership roles in the company before being named CEO.
Tyson also detailed its fiscal third quarter results, which reflected the volatility and uncertainty related to the coronavirus (COVID-19) pandemic.
Net income for Tyson’s third fiscal quarter ended June 27, 2020, totaled $527 million, equal to $1.44 per share on the common stock, down by more than 30% compared to $676 million and $1.84 per share from the same period the previous year.
Sales for the quarter dipped to $10.02 billion from $10.89 billion the previous year.
After exceeding sales expectations for the quarter, shares of Tyson stock increased just under 1% ($63.26 per share) in premarket trading.
Sales in Tyson’s Beef and Pork segments were $3.65 billion and $1.12 billion for the quarter, down 23.8% and 16.5%, respectively. The Chicken unit’s sales were $3.11 billion, down 4.2% and Prepared Foods sales were $2.04 billion, a 6% decrease from the same quarter in 2019. Sales in the International business segment was a bright spot, topping $402 million for the quarter, up 25% from the same period last year.
Operating income in the Beef and Pork segments were positive, at $651 million (up 17.8%) and $107 million (up 9.6%) compared to last year. Prepared Foods, with operating income of $145 million was an increase of 7.1% while the Chicken segment was negative $120 million, 3.9% more of a loss compared to last year.
The company noted positive results in its Beef and Pork business segments offset challenges associated with COVID-19 and that it had made substantial investments to ensure worker health and safety.
“Without a doubt, our third fiscal quarter was one of the most volatile and uncertain periods I’ve seen during my time in the industry,” said Noel White. “However, our commitment to team member health and safety and investments in operations and portfolio strategy effectively positioned us to weather unprecedented COVID-19 marketplace volatility while allowing us to support our farmers, ranchers and producers and meet our customers’ needs.”
Looking ahead, the company said it is experiencing multiple challenges related to the pandemic that are expected to negatively impact it for the remainder of fiscal 2020 and into 2021. The uncertainty of the situation was the reason for Tyson not issuing guidance at this time.
“We cannot currently predict the ultimate impact that COVID-19 will have on our short- and long-term demand, as it will depend on, among other things, the severity and duration of the COVID-19 crisis.” The company said. “Our liquidity is expected to be adequate to continue to run our operations and meet our obligations as they become due. Due to the inability to reasonably quantify the total impact of COVID-19 to our operations, we are not currently providing segment adjusted operating margin guidance.”