Business News

Tyson shares jump after company boosts guidance, cuts jobs

Key Points
  • Tyson raised guidance for its current fiscal year, due to end this week, following strong beef earnings.
  • The company will cut about 450 jobs across several areas and job levels, Tyson said.
Tyson Foods to eliminate 450 jobs
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Tyson Foods to eliminate 450 jobs

Tyson Foods shares closed up 7.6 percent Friday after the company boosted its earnings guidance on strong beef segment performance.

The company also announced it will cut approximately 450 jobs.

For Tyson's fiscal year, which ends Saturday, the company raised guidance to $5.20 to $5.30 adjusted earnings per share, from $4.95 to $5.05.

Focusing on the next fiscal year, Tyson said it expects per-share earnings of $5.70 to $5.85, topping estimates of $5.35.

Tyson also said it would cut about 450 jobs across several areas and job levels. Most of the cuts will come from the corporate offices in Cincinnati, Chicago, and Springdale, Arkansas.

Tyson is implementing its previously announced "Financial Fitness" plans, CEO Tom Hayes said in a statement. The company expects net savings of $200 million, $400 million and $600 million over fiscal years 2018, 2019 and 2020, respectively, according to a press release. The savings will primarily affect the prepared foods and chicken segments.

Tyson is scheduled to report fourth quarter earnings on Nov. 13. It expects to report restructuring costs of $140 million to $150 million, according to the press release. Of that, about $45 million to $50 million will be from employee termination costs.

Tyson will hold a call with analysts on Friday to discuss Thursday's announcement.