Tyson Foods, Inc. (NYSE:TSN) Q3 2023 Earnings Call Transcript

John Tyson: Yeah, and I think I would point out to a couple of things there. So, first off, we talking about the sequential improvements in operational execution. And more or less, you haven’t seen market condition materially change quarter-to-quarter. So, I guess, we just do emphasize that as a proof point that we’re talking about execution, but holding the external data mostly static we’re starting to see that come through. And you did picked up correctly on the 200 is kind of a run rate number. And again, when we talk about making the same amount of food in a smaller footprint, we do have some – we have confidence in just what that cost elimination means from an overall probability. But we obviously are subject to where commodity markets move on both the input and the market side.

So, recovery there helps us as it does everyone in the industry. So, we kind of focus on what’s in our control and I think beyond, what I’ve just said is probably too early to issue any numbers for ’24. Will give a look at that when we get to the November call. So, hopefully that’s somewhat more helpful than what you’re looking for.

Adam Samuelson: No. It is. And I guess though, if I think philosophically historically, the company would always talk about profitability in Chicken and less volatility than the industry as a whole and not seeing the lows but others in the industry not seeing the same highs. And I guess I am not saying that others in the industry haven’t seen real lows in the last 6 to 12 months. It’s been a real challenge for the whole industry. I guess, the historical model would have – maybe think that Tyson’s Chicken business would be more resilient. So how does the experience of the last year kind of inform how you would think about the Tyson’s relative performance versus the industry and the margin potential of the business is currently constructed?

John Tyson: I let Donnie comment on that one.

Donnie King: As I said earlier, Adam, we’re – we believe in Chicken, we’re on the right path. I would tell you it’s the right path we’ve been on that path for about two years now, and we’ve had a number of fits and starts from the breeder side to a demand – with the demand picture. We’re on our way to healing it from a genetics perspective on the live side. In terms of our operations, they’re performing better than have. But then the third one and it really impacted US in Q1 last year is the demand picture that we struggle with getting a really accurate view of that. I would tell you the good news is, in Q2, we were able to get that done. We actually started seeing benefits of that in Q3. And so, we feel like we have a better picture of what the demand truly and consumption truly looks like and that informs us again in terms of supply.

And so, we feel more balanced today than we have over the past two quarters and the executional elements that we’ve talked about. We’re obviously doing those a lot better than before. And then, if you look at the bridge that you’re trying to create, it bases your question, yes, there are some asset impairments. Yes, there is some plant closures. There’s, the typical labor yield and all those types of things that we’re managing. But we are doing every one of those things. And so, I feel really good about where we are in Chicken and the path that we’re on. And the future looks really, really good to me. John?