x
|
Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
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¨
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Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
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Delaware
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71-0225165
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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|
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2200 Don Tyson Parkway, Springdale, Arkansas
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72762-6999
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(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer
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x
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Accelerated filer
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¨
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Non-accelerated filer
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¨
(Do not check if a smaller reporting company)
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Smaller reporting company
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¨
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Class
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Outstanding Shares
|
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Class A Common Stock, $0.10 Par Value (Class A stock)
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282,195,269
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Class B Common Stock, $0.10 Par Value (Class B stock)
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70,015,755
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PAGE
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Item 1.
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Item 2.
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Item 3.
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Item 4.
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Item 1.
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Item 1A.
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Item 2.
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Item 3.
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Item 4.
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Item 5.
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Item 6.
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Item 1.
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Financial Statements
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Three Months Ended
|
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Nine Months Ended
|
||||||||||||
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June 29, 2013
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June 30, 2012
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June 29, 2013
|
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June 30, 2012
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||||||||
Sales
|
$
|
8,731
|
|
|
$
|
8,261
|
|
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$
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25,480
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$
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24,740
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Cost of Sales
|
8,049
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7,695
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23,791
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23,140
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||||
Gross Profit
|
682
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566
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1,689
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1,600
|
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||||
Selling, General and Administrative
|
263
|
|
|
224
|
|
|
730
|
|
|
668
|
|
||||
Operating Income
|
419
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|
|
342
|
|
|
959
|
|
|
932
|
|
||||
Other (Income) Expense:
|
|
|
|
|
|
|
|
||||||||
Interest income
|
(2
|
)
|
|
(2
|
)
|
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(5
|
)
|
|
(9
|
)
|
||||
Interest expense
|
36
|
|
|
215
|
|
|
109
|
|
|
316
|
|
||||
Other, net
|
—
|
|
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(3
|
)
|
|
(19
|
)
|
|
(17
|
)
|
||||
Total Other (Income) Expense
|
34
|
|
|
210
|
|
|
85
|
|
|
290
|
|
||||
Income from Continuing Operations before Income Taxes
|
385
|
|
|
132
|
|
|
874
|
|
|
642
|
|
||||
Income Tax Expense
|
136
|
|
|
53
|
|
|
285
|
|
|
231
|
|
||||
Income from Continuing Operations
|
249
|
|
|
79
|
|
|
589
|
|
|
411
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||||
Loss from Discontinued Operation, Net of Tax
|
(4
|
)
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(6
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)
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(70
|
)
|
|
(16
|
)
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||||
Net Income
|
245
|
|
|
73
|
|
|
519
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395
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||||
Less: Net Income (Loss) Attributable to Noncontrolling Interest
|
(4
|
)
|
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(3
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)
|
|
2
|
|
|
(3
|
)
|
||||
Net Income Attributable to Tyson
|
$
|
249
|
|
|
$
|
76
|
|
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$
|
517
|
|
|
$
|
398
|
|
Amounts attributable to Tyson:
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|
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||||||||
Net Income from Continuing Operations
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253
|
|
|
82
|
|
|
587
|
|
|
414
|
|
||||
Net Loss from Discontinued Operation
|
(4
|
)
|
|
(6
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)
|
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(70
|
)
|
|
(16
|
)
|
||||
Net Income Attributable to Tyson
|
$
|
249
|
|
|
$
|
76
|
|
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$
|
517
|
|
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$
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398
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|
Weighted Average Shares Outstanding:
|
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|
|
|
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||||||||
Class A Basic
|
283
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|
|
291
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|
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284
|
|
|
294
|
|
||||
Class B Basic
|
70
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|
|
70
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|
|
70
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|
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70
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|
||||
Diluted
|
369
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369
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366
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|
|
373
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|
||||
Net Income Per Share from Continuing Operations Attributable to Tyson:
|
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|
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||||||||
Class A Basic
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$
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0.73
|
|
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$
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0.23
|
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$
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1.69
|
|
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$
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1.16
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Class B Basic
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$
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0.66
|
|
|
$
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0.20
|
|
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$
|
1.52
|
|
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$
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1.04
|
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Diluted
|
$
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0.69
|
|
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$
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0.22
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$
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1.61
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$
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1.11
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Net Loss Per Share from Discontinued Operation Attributable to Tyson:
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|
|
|
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||||||||
Class A Basic
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$
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(0.01
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)
|
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$
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(0.02
|
)
|
|
$
|
(0.20
|
)
|
|
$
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(0.05
|
)
|
Class B Basic
|
$
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(0.02
|
)
|
|
$
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(0.01
|
)
|
|
$
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(0.18
|
)
|
|
$
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(0.04
|
)
|
Diluted
|
$
|
(0.01
|
)
|
|
$
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(0.01
|
)
|
|
$
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(0.19
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)
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|
$
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(0.04
|
)
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Net Income Per Share Attributable to Tyson:
|
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||||||||
Class A Basic
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$
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0.72
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$
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0.21
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$
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1.49
|
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$
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1.11
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Class B Basic
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$
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0.64
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$
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0.19
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$
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1.34
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$
|
1.00
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Diluted
|
$
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0.68
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$
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0.21
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$
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1.42
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$
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1.07
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Dividends Declared Per Share:
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||||||||
Class A
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$
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0.050
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$
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0.040
|
|
|
$
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0.260
|
|
|
$
|
0.120
|
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Class B
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$
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0.045
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|
$
|
0.036
|
|
|
$
|
0.234
|
|
|
$
|
0.108
|
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Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
June 29, 2013
|
|
June 30, 2012
|
|
June 29, 2013
|
|
June 30, 2012
|
||||||||
Net Income
|
$
|
245
|
|
|
$
|
73
|
|
|
$
|
519
|
|
|
$
|
395
|
|
Other Comprehensive Income (Loss), Net of Taxes:
|
|
|
|
|
|
|
|
||||||||
Derivatives accounted for as cash flow hedges
|
2
|
|
|
5
|
|
|
(12
|
)
|
|
11
|
|
||||
Investments
|
1
|
|
|
(1
|
)
|
|
(2
|
)
|
|
—
|
|
||||
Currency translation
|
(33
|
)
|
|
(38
|
)
|
|
(49
|
)
|
|
(8
|
)
|
||||
Postretirement benefits
|
1
|
|
|
1
|
|
|
4
|
|
|
3
|
|
||||
Total Other Comprehensive Income (Loss), Net of Taxes
|
(29
|
)
|
|
(33
|
)
|
|
(59
|
)
|
|
6
|
|
||||
Comprehensive Income
|
216
|
|
|
40
|
|
|
460
|
|
|
401
|
|
||||
Less: Comprehensive Income (Loss) Attributable to Noncontrolling Interest
|
(4
|
)
|
|
(3
|
)
|
|
2
|
|
|
(3
|
)
|
||||
Comprehensive Income Attributable to Tyson
|
$
|
220
|
|
|
$
|
43
|
|
|
$
|
458
|
|
|
$
|
404
|
|
|
June 29, 2013
|
|
September 29, 2012
|
||||
Assets
|
|
|
|
||||
Current Assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
943
|
|
|
$
|
1,071
|
|
Accounts receivable, net
|
1,454
|
|
|
1,378
|
|
||
Inventories
|
2,901
|
|
|
2,809
|
|
||
Other current assets
|
229
|
|
|
145
|
|
||
Total Current Assets
|
5,527
|
|
|
5,403
|
|
||
Net Property, Plant and Equipment
|
4,042
|
|
|
4,022
|
|
||
Goodwill
|
1,903
|
|
|
1,891
|
|
||
Intangible Assets
|
143
|
|
|
129
|
|
||
Other Assets
|
487
|
|
|
451
|
|
||
Total Assets
|
$
|
12,102
|
|
|
$
|
11,896
|
|
|
|
|
|
||||
Liabilities and Shareholders’ Equity
|
|
|
|
||||
Current Liabilities:
|
|
|
|
||||
Current debt
|
$
|
508
|
|
|
$
|
515
|
|
Accounts payable
|
1,309
|
|
|
1,372
|
|
||
Other current liabilities
|
1,121
|
|
|
943
|
|
||
Total Current Liabilities
|
2,938
|
|
|
2,830
|
|
||
Long-Term Debt
|
1,899
|
|
|
1,917
|
|
||
Deferred Income Taxes
|
467
|
|
|
558
|
|
||
Other Liabilities
|
551
|
|
|
549
|
|
||
Commitments and Contingencies (Note 15)
|
|
|
|
||||
Shareholders’ Equity:
|
|
|
|
||||
Common stock ($0.10 par value):
|
|
|
|
||||
Class A-authorized 900 million shares, issued 322 million shares
|
32
|
|
|
32
|
|
||
Convertible Class B-authorized 900 million shares, issued 70 million shares
|
7
|
|
|
7
|
|
||
Capital in excess of par value
|
2,288
|
|
|
2,278
|
|
||
Retained earnings
|
4,754
|
|
|
4,327
|
|
||
Accumulated other comprehensive loss
|
(122
|
)
|
|
(63
|
)
|
||
Treasury stock, at cost – 40 million shares at June 29, 2013, and 33 million shares at September 29, 2012
|
(746
|
)
|
|
(569
|
)
|
||
Total Tyson Shareholders’ Equity
|
6,213
|
|
|
6,012
|
|
||
Noncontrolling Interest
|
34
|
|
|
30
|
|
||
Total Shareholders’ Equity
|
6,247
|
|
|
6,042
|
|
||
Total Liabilities and Shareholders’ Equity
|
$
|
12,102
|
|
|
$
|
11,896
|
|
|
Nine Months Ended
|
||||||
|
June 29, 2013
|
|
June 30, 2012
|
||||
Cash Flows From Operating Activities:
|
|
|
|
||||
Net income
|
$
|
519
|
|
|
$
|
395
|
|
Depreciation and amortization
|
387
|
|
|
369
|
|
||
Deferred income taxes
|
(21
|
)
|
|
75
|
|
||
Loss on early extinguishment of debt
|
—
|
|
|
167
|
|
||
Other, net
|
80
|
|
|
(1
|
)
|
||
Net changes in working capital
|
(193
|
)
|
|
(286
|
)
|
||
Cash Provided by Operating Activities
|
772
|
|
|
719
|
|
||
Cash Flows From Investing Activities:
|
|
|
|
||||
Additions to property, plant and equipment
|
(425
|
)
|
|
(530
|
)
|
||
Purchases of marketable securities
|
(123
|
)
|
|
(45
|
)
|
||
Proceeds from sale of marketable securities
|
22
|
|
|
36
|
|
||
Acquisitions, net of cash acquired
|
(106
|
)
|
|
—
|
|
||
Other, net
|
36
|
|
|
19
|
|
||
Cash Used for Investing Activities
|
(596
|
)
|
|
(520
|
)
|
||
Cash Flows From Financing Activities:
|
|
|
|
||||
Payments on debt
|
(69
|
)
|
|
(919
|
)
|
||
Net proceeds from borrowings
|
48
|
|
|
1,082
|
|
||
Purchases of Tyson Class A common stock
|
(298
|
)
|
|
(209
|
)
|
||
Dividends
|
(87
|
)
|
|
(44
|
)
|
||
Stock options exercised
|
93
|
|
|
32
|
|
||
Other, net
|
13
|
|
|
(26
|
)
|
||
Cash Used for Financing Activities
|
(300
|
)
|
|
(84
|
)
|
||
Effect of Exchange Rate Changes on Cash
|
(4
|
)
|
|
(3
|
)
|
||
Increase (Decrease) in Cash and Cash Equivalents
|
(128
|
)
|
|
112
|
|
||
Cash and Cash Equivalents at Beginning of Year
|
1,071
|
|
|
716
|
|
||
Cash and Cash Equivalents at End of Period
|
$
|
943
|
|
|
$
|
828
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||||||||||||||
|
|
June 29, 2013
|
|
June 30, 2012
|
|
June 29, 2013
|
|
June 30, 2012
|
||||||||||||||||||||
|
|
Shares
|
|
Dollars
|
|
Shares
|
|
Dollars
|
|
Shares
|
|
Dollars
|
|
Shares
|
|
Dollars
|
||||||||||||
Shares repurchased:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Under share repurchase program
|
|
4.0
|
|
|
$
|
100
|
|
|
3.9
|
|
|
$
|
75
|
|
|
11.2
|
|
|
$
|
250
|
|
|
9.3
|
|
|
$
|
180
|
|
To fund certain obligations under equity compensation plans
|
|
0.4
|
|
|
10
|
|
|
0.4
|
|
|
6
|
|
|
2.3
|
|
|
48
|
|
|
1.6
|
|
|
29
|
|
||||
Total share repurchases
|
|
4.4
|
|
|
$
|
110
|
|
|
4.3
|
|
|
$
|
81
|
|
|
13.5
|
|
|
$
|
298
|
|
|
10.9
|
|
|
$
|
209
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
June 29, 2013
|
|
June 30, 2012
|
|
June 29, 2013
|
|
June 30, 2012
|
||||||||
Sales
|
$
|
36
|
|
|
$
|
47
|
|
|
$
|
108
|
|
|
$
|
165
|
|
|
|
|
|
|
|
|
|
||||||||
Pretax loss
|
(2
|
)
|
|
(6
|
)
|
|
(68
|
)
|
|
(16
|
)
|
||||
Income tax expense
|
2
|
|
|
—
|
|
|
2
|
|
|
—
|
|
||||
Loss from Discontinued Operation
|
$
|
(4
|
)
|
|
$
|
(6
|
)
|
|
$
|
(70
|
)
|
|
$
|
(16
|
)
|
|
June 29, 2013
|
|
September 29, 2012
|
||||
Processed products:
|
|
|
|
||||
Weighted-average method – chicken and prepared foods
|
$
|
864
|
|
|
$
|
754
|
|
First-in, first-out method – beef and pork
|
628
|
|
|
611
|
|
||
Livestock – first-in, first-out method
|
1,003
|
|
|
952
|
|
||
Supplies and other – weighted-average method
|
406
|
|
|
492
|
|
||
Total inventories
|
$
|
2,901
|
|
|
$
|
2,809
|
|
|
June 29, 2013
|
|
September 29, 2012
|
||||
Land
|
$
|
100
|
|
|
$
|
101
|
|
Buildings and leasehold improvements
|
2,903
|
|
|
2,868
|
|
||
Machinery and equipment
|
5,412
|
|
|
5,208
|
|
||
Land improvements and other
|
417
|
|
|
408
|
|
||
Buildings and equipment under construction
|
291
|
|
|
298
|
|
||
|
9,123
|
|
|
8,883
|
|
||
Less accumulated depreciation
|
5,081
|
|
|
4,861
|
|
||
Net property, plant and equipment
|
$
|
4,042
|
|
|
$
|
4,022
|
|
|
June 29, 2013
|
|
September 29, 2012
|
||||
Accrued salaries, wages and benefits
|
$
|
381
|
|
|
$
|
382
|
|
Self-insurance reserves
|
272
|
|
|
274
|
|
||
Other
|
468
|
|
|
287
|
|
||
Total other current liabilities
|
$
|
1,121
|
|
|
$
|
943
|
|
|
June 29, 2013
|
|
September 29, 2012
|
||||
Revolving credit facility
|
$
|
—
|
|
|
$
|
—
|
|
Senior notes:
|
|
|
|
||||
3.25% Convertible senior notes due October 2013 (2013 Notes)
|
458
|
|
|
458
|
|
||
6.60% Senior notes due April 2016 (2016 Notes)
|
638
|
|
|
638
|
|
||
7.00% Notes due May 2018
|
120
|
|
|
120
|
|
||
4.50% Senior notes due June 2022 (2022 Notes)
|
1,000
|
|
|
1,000
|
|
||
7.00% Notes due January 2028
|
18
|
|
|
18
|
|
||
Discount on senior notes
|
(12
|
)
|
|
(28
|
)
|
||
GO Zone tax-exempt bonds due October 2033 (0.06% at 6/29/2013)
|
100
|
|
|
100
|
|
||
Other
|
85
|
|
|
126
|
|
||
Total debt
|
2,407
|
|
|
2,432
|
|
||
Less current debt
|
508
|
|
|
515
|
|
||
Total long-term debt
|
$
|
1,899
|
|
|
$
|
1,917
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
June 29, 2013
|
|
June 30, 2012
|
|
June 29, 2013
|
|
June 30, 2012
|
||||||||
Numerator:
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations
|
$
|
249
|
|
|
$
|
79
|
|
|
$
|
589
|
|
|
$
|
411
|
|
Less: Net income (loss) from continuing operations attributable to noncontrolling interest
|
(4
|
)
|
|
(3
|
)
|
|
2
|
|
|
(3
|
)
|
||||
Net income from continuing operations attributable to Tyson
|
253
|
|
|
82
|
|
|
587
|
|
|
414
|
|
||||
Less Dividends Declared:
|
|
|
|
|
|
|
|
||||||||
Class A
|
14
|
|
|
12
|
|
|
74
|
|
|
36
|
|
||||
Class B
|
3
|
|
|
3
|
|
|
16
|
|
|
8
|
|
||||
Undistributed earnings
|
$
|
236
|
|
|
$
|
67
|
|
|
$
|
497
|
|
|
$
|
370
|
|
|
|
|
|
|
|
|
|
||||||||
Class A undistributed earnings
|
$
|
193
|
|
|
$
|
56
|
|
|
$
|
406
|
|
|
$
|
305
|
|
Class B undistributed earnings
|
43
|
|
|
11
|
|
|
91
|
|
|
65
|
|
||||
Total undistributed earnings
|
$
|
236
|
|
|
$
|
67
|
|
|
$
|
497
|
|
|
$
|
370
|
|
Denominator:
|
|
|
|
|
|
|
|
||||||||
Denominator for basic earnings per share:
|
|
|
|
|
|
|
|
||||||||
Class A weighted average shares
|
283
|
|
|
291
|
|
|
284
|
|
|
294
|
|
||||
Class B weighted average shares, and shares under the if-converted method for diluted earnings per share
|
70
|
|
|
70
|
|
|
70
|
|
|
70
|
|
||||
Effect of dilutive securities:
|
|
|
|
|
|
|
|
||||||||
Stock options and restricted stock
|
5
|
|
|
5
|
|
|
5
|
|
|
5
|
|
||||
Convertible 2013 Notes and Warrants
|
11
|
|
|
3
|
|
|
7
|
|
|
4
|
|
||||
Denominator for diluted earnings per share – adjusted weighted average shares and assumed conversions
|
369
|
|
|
369
|
|
|
366
|
|
|
373
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Net Income Per Share from Continuing Operations Attributable to Tyson:
|
|
|
|
|
|
|
|||||||||
Class A Basic
|
$
|
0.73
|
|
|
$
|
0.23
|
|
|
$
|
1.69
|
|
|
$
|
1.16
|
|
Class B Basic
|
$
|
0.66
|
|
|
$
|
0.20
|
|
|
$
|
1.52
|
|
|
$
|
1.04
|
|
Diluted
|
$
|
0.69
|
|
|
$
|
0.22
|
|
|
$
|
1.61
|
|
|
$
|
1.11
|
|
Net Income Per Share Attributable to Tyson:
|
|
|
|
|
|
|
|
||||||||
Class A Basic
|
$
|
0.72
|
|
|
$
|
0.21
|
|
|
$
|
1.49
|
|
|
$
|
1.11
|
|
Class B Basic
|
$
|
0.64
|
|
|
$
|
0.19
|
|
|
$
|
1.34
|
|
|
$
|
1.00
|
|
Diluted
|
$
|
0.68
|
|
|
$
|
0.21
|
|
|
$
|
1.42
|
|
|
$
|
1.07
|
|
•
|
Cash Flow Hedges – include certain commodity forward and option contracts of forecasted purchases (i.e., grains) and certain foreign exchange forward contracts.
|
•
|
Fair Value Hedges – include certain commodity forward contracts related to firm commitments (i.e., livestock).
|
•
|
Net Investment Hedges – include certain foreign currency forward contracts of permanently invested capital in certain foreign subsidiaries.
|
|
Gain/(Loss)
Recognized in OCI
On Derivatives
|
|
|
Consolidated Condensed
Statements of Income
Classification
|
|
Gain/(Loss)
Reclassified from
OCI to Earnings
|
|
||||||||||
|
Three Months Ended
|
|
|
|
Three Months Ended
|
||||||||||||
|
June 29,
2013 |
|
June 30,
2012 |
|
|
|
June 29,
2013 |
|
June 30,
2012 |
||||||||
Cash Flow Hedge – Derivatives designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
||||||||
Commodity contracts
|
$
|
(5
|
)
|
|
$
|
7
|
|
|
Cost of Sales
|
|
$
|
(2
|
)
|
|
$
|
1
|
|
Foreign exchange contracts
|
3
|
|
|
1
|
|
|
Other Income/Expense
|
|
(2
|
)
|
|
(1
|
)
|
||||
Total
|
$
|
(2
|
)
|
|
$
|
8
|
|
|
|
|
$
|
(4
|
)
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Gain/(Loss)
Recognized in OCI On Derivatives |
|
|
Consolidated Condensed
Statements of Income
Classification
|
|
Gain/(Loss)
Reclassified from OCI to Earnings |
|
||||||||||
|
Nine Months Ended
|
|
|
|
Nine Months Ended
|
||||||||||||
|
June 29,
2013 |
|
June 30,
2012 |
|
|
|
June 29,
2013 |
|
June 30,
2012 |
||||||||
Cash Flow Hedge – Derivatives designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
||||||||
Commodity contracts
|
$
|
(28
|
)
|
|
$
|
13
|
|
|
Cost of Sales
|
|
$
|
(5
|
)
|
|
$
|
(15
|
)
|
Foreign exchange contracts
|
(2
|
)
|
|
(6
|
)
|
|
Other Income/Expense
|
|
(4
|
)
|
|
4
|
|
||||
Total
|
$
|
(30
|
)
|
|
$
|
7
|
|
|
|
|
$
|
(9
|
)
|
|
$
|
(11
|
)
|
|
Metric
|
|
June 29, 2013
|
|
September 29, 2012
|
||
Commodity:
|
|
|
|
|
|
||
Live Cattle
|
Pounds
|
|
93
|
|
|
232
|
|
Lean Hogs
|
Pounds
|
|
264
|
|
|
239
|
|
|
|
|
|
|
|
|
|
|
in millions
|
|
|||||||
|
Consolidated Condensed
Statements of Income
Classification
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
June 29,
2013 |
|
June 30,
2012 |
|
June 29,
2013 |
|
June 30,
2012 |
|||||||||
Gain/(Loss) on forwards
|
Cost of Sales
|
|
$
|
11
|
|
|
$
|
32
|
|
|
$
|
26
|
|
|
$
|
32
|
|
Gain/(Loss) on purchase contract
|
Cost of Sales
|
|
(11
|
)
|
|
(32
|
)
|
|
(26
|
)
|
|
(32
|
)
|
|
Gain/(Loss)
Recognized in OCI
On Derivatives
|
|
|
Consolidated Condensed
Statements of Income
Classification
|
|
Gain/(Loss)
Reclassified from
OCI to Earnings
|
|
||||||||||
|
Three Months Ended
|
|
|
|
Three Months Ended
|
||||||||||||
|
June 29,
2013 |
|
June 30,
2012 |
|
|
|
June 29,
2013 |
|
June 30,
2012 |
||||||||
Net Investment Hedge – Derivatives designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign exchange contracts
|
$
|
—
|
|
|
$
|
1
|
|
|
Other Income/Expense
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Gain/(Loss)
Recognized in OCI
On Derivatives
|
|
|
Consolidated Condensed
Statements of Income
Classification
|
|
Gain/(Loss)
Reclassified from
OCI to Earnings
|
|
||||||||||
|
Nine Months Ended
|
|
|
|
Nine Months Ended
|
||||||||||||
|
June 29,
2013 |
|
June 30,
2012 |
|
|
|
June 29,
2013 |
|
June 30,
2012 |
||||||||
Net Investment Hedge – Derivatives designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign exchange contracts
|
$
|
—
|
|
|
$
|
(1
|
)
|
|
Other Income/Expense
|
|
$
|
(4
|
)
|
|
$
|
—
|
|
|
Metric
|
|
June 29, 2013
|
|
September 29, 2012
|
||||
Commodity:
|
|
|
|
|
|
||||
Corn
|
Bushels
|
|
17
|
|
|
19
|
|
||
Soy Meal
|
Tons
|
|
96,800
|
|
|
1,200
|
|
||
Soy Oil
|
Pounds
|
|
—
|
|
|
17
|
|
||
Live Cattle
|
Pounds
|
|
191
|
|
|
68
|
|
||
Lean Hogs
|
Pounds
|
|
12
|
|
|
108
|
|
||
Foreign Currency
|
United States dollars
|
|
$
|
83
|
|
|
$
|
165
|
|
Interest Rate
|
Average monthly notional debt
|
|
$
|
25
|
|
|
$
|
27
|
|
|
Consolidated Condensed
Statements of Income
Classification
|
|
Gain/(Loss)
Recognized in Earnings
|
|
|
Gain/(Loss)
Recognized in Earnings
|
|
||||||||||
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
|
June 29, 2013
|
|
June 30, 2012
|
|
June 29, 2013
|
|
June 30, 2012
|
||||||||
Derivatives not designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
||||||||
Commodity contracts
|
Sales
|
|
$
|
(7
|
)
|
|
$
|
3
|
|
|
$
|
(19
|
)
|
|
$
|
(6
|
)
|
Commodity contracts
|
Cost of Sales
|
|
(8
|
)
|
|
(22
|
)
|
|
(15
|
)
|
|
36
|
|
||||
Foreign exchange contracts
|
Other Income/Expense
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Total
|
|
|
$
|
(17
|
)
|
|
$
|
(19
|
)
|
|
$
|
(34
|
)
|
|
$
|
30
|
|
|
Fair Value
|
||||||
|
June 29, 2013
|
|
September 29, 2012
|
||||
Derivative Assets:
|
|
|
|
||||
Derivatives designated as hedging instruments:
|
|
|
|
||||
Commodity contracts
|
$
|
5
|
|
|
$
|
32
|
|
Derivatives not designated as hedging instruments:
|
|
|
|
||||
Commodity contracts
|
4
|
|
|
21
|
|
||
Foreign exchange contracts
|
1
|
|
|
1
|
|
||
Total derivative assets – not designated
|
5
|
|
|
22
|
|
||
|
|
|
|
||||
Total derivative assets
|
$
|
10
|
|
|
$
|
54
|
|
Derivative Liabilities:
|
|
|
|
||||
Derivatives designated as hedging instruments:
|
|
|
|
||||
Commodity contracts
|
$
|
9
|
|
|
$
|
6
|
|
Foreign exchange contracts
|
—
|
|
|
1
|
|
||
Total derivative liabilities – designated
|
9
|
|
|
7
|
|
||
Derivatives not designated as hedging instruments:
|
|
|
|
||||
Commodity contracts
|
64
|
|
|
96
|
|
||
Foreign exchange contracts
|
3
|
|
|
2
|
|
||
Interest rate contracts
|
—
|
|
|
—
|
|
||
Total derivative liabilities – not designated
|
67
|
|
|
98
|
|
||
|
|
|
|
||||
Total derivative liabilities
|
$
|
76
|
|
|
$
|
105
|
|
•
|
Quoted prices for similar assets or liabilities in active markets;
|
•
|
Quoted prices for identical or similar assets in non-active markets;
|
•
|
Inputs other than quoted prices that are observable for the asset or liability; and
|
•
|
Inputs derived principally from or corroborated by other observable market data.
|
June 29, 2013
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Netting (a)
|
|
Total
|
||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Commodity Derivatives
|
$
|
—
|
|
|
$
|
9
|
|
|
$
|
—
|
|
|
$
|
(1
|
)
|
|
$
|
8
|
|
Foreign Exchange Forward Contracts
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|||||
Available for Sale Securities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Current
|
—
|
|
|
81
|
|
|
—
|
|
|
—
|
|
|
81
|
|
|||||
Non-current
|
6
|
|
|
26
|
|
|
65
|
|
|
—
|
|
|
97
|
|
|||||
Deferred Compensation Assets
|
22
|
|
|
184
|
|
|
—
|
|
|
—
|
|
|
206
|
|
|||||
Total Assets
|
$
|
28
|
|
|
$
|
301
|
|
|
$
|
65
|
|
|
$
|
(1
|
)
|
|
$
|
393
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Commodity Derivatives
|
$
|
—
|
|
|
$
|
73
|
|
|
$
|
—
|
|
|
$
|
(72
|
)
|
|
$
|
1
|
|
Foreign Exchange Forward Contracts
|
—
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|||||
Total Liabilities
|
$
|
—
|
|
|
$
|
76
|
|
|
$
|
—
|
|
|
$
|
(72
|
)
|
|
$
|
4
|
|
September 29, 2012
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Netting (a)
|
|
Total
|
||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Commodity Derivatives
|
$
|
—
|
|
|
$
|
53
|
|
|
$
|
—
|
|
|
$
|
(40
|
)
|
|
$
|
13
|
|
Foreign Exchange Forward Contracts
|
—
|
|
|
1
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|||||
Available for Sale Securities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Current
|
—
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|||||
Non-current
|
6
|
|
|
25
|
|
|
86
|
|
|
—
|
|
|
117
|
|
|||||
Deferred Compensation Assets
|
31
|
|
|
149
|
|
|
—
|
|
|
—
|
|
|
180
|
|
|||||
Total Assets
|
$
|
37
|
|
|
$
|
231
|
|
|
$
|
86
|
|
|
$
|
(41
|
)
|
|
$
|
313
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Commodity Derivatives
|
$
|
—
|
|
|
$
|
102
|
|
|
$
|
—
|
|
|
$
|
(100
|
)
|
|
$
|
2
|
|
Foreign Exchange Forward Contracts
|
—
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|||||
Total Liabilities
|
$
|
—
|
|
|
$
|
105
|
|
|
$
|
—
|
|
|
$
|
(100
|
)
|
|
$
|
5
|
|
(a)
|
Our derivative assets and liabilities are presented in our Consolidated Condensed Balance Sheets on a net basis. We net derivative assets and liabilities, including cash collateral, when a legally enforceable master netting arrangement exists between the counterparty to a derivative contract and us. At
June 29, 2013
, and
September 29, 2012
, we had posted with various counterparties
$71 million
and
$59 million
, respectively, of cash collateral and held no cash collateral.
|
|
Nine Months Ended
|
||||||
|
June 29, 2013
|
|
June 30, 2012
|
||||
Balance at beginning of year
|
$
|
86
|
|
|
$
|
83
|
|
Total realized and unrealized gains (losses):
|
|
|
|
||||
Included in earnings
|
1
|
|
|
1
|
|
||
Included in other comprehensive income (loss)
|
(1
|
)
|
|
(1
|
)
|
||
Purchases
|
14
|
|
|
20
|
|
||
Issuances
|
—
|
|
|
—
|
|
||
Settlements
|
(35
|
)
|
|
(21
|
)
|
||
Balance at end of period
|
$
|
65
|
|
|
$
|
82
|
|
Total gains (losses) for the nine-month period included in earnings attributable to the change in unrealized gains (losses) relating to assets and liabilities still held at end of period
|
$
|
—
|
|
|
$
|
—
|
|
(in millions)
|
June 29, 2013
|
|
September 29, 2012
|
||||||||||||||||||||
|
Amortized
Cost Basis |
|
|
Fair
Value |
|
|
Unrealized
Gain/(Loss) |
|
|
Amortized
Cost Basis |
|
|
Fair
Value |
|
|
Unrealized
Gain/(Loss) |
|
||||||
Available for Sale Securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Debt Securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. Treasury and Agency
|
$
|
26
|
|
|
$
|
27
|
|
|
$
|
1
|
|
|
$
|
26
|
|
|
$
|
27
|
|
|
$
|
1
|
|
Certificates of Deposit and Commercial Paper
|
80
|
|
|
80
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Corporate and Asset-Backed (a)
|
65
|
|
|
65
|
|
|
—
|
|
|
64
|
|
|
66
|
|
|
2
|
|
||||||
Redeemable Preferred Stock
|
—
|
|
|
—
|
|
|
—
|
|
|
20
|
|
|
20
|
|
|
—
|
|
||||||
Equity Securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Common Stock and Warrants
|
9
|
|
|
6
|
|
|
(3
|
)
|
|
9
|
|
|
7
|
|
|
(2
|
)
|
(a)
|
At
June 29, 2013
, and
September 29, 2012
, the amortized cost basis for Corporate and Asset-Backed debt securities had been reduced by accumulated other than temporary impairments of
$1 million
and
$2 million
, respectively.
|
|
June 29, 2013
|
|
September 29, 2012
|
||||||||||||
|
Fair Value
|
|
Carrying Value
|
|
Fair Value
|
|
Carrying Value
|
||||||||
Total Debt
|
$
|
2,535
|
|
|
$
|
2,407
|
|
|
$
|
2,596
|
|
|
$
|
2,432
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||||||||||||||||||||||||||
|
June 29, 2013
|
|
June 30, 2012
|
|
June 29, 2013
|
|
June 30, 2012
|
||||||||||||||||||||||||||||||||
|
Before Tax
|
Tax
|
After Tax
|
|
Before Tax
|
Tax
|
After Tax
|
|
Before Tax
|
Tax
|
After Tax
|
|
Before Tax
|
Tax
|
After Tax
|
||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Derivatives accounted for as cash flow hedges:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
(Gain) loss reclassified to Cost of Sales
|
$
|
2
|
|
$
|
(1
|
)
|
$
|
1
|
|
|
$
|
(1
|
)
|
$
|
—
|
|
$
|
(1
|
)
|
|
$
|
5
|
|
$
|
(2
|
)
|
$
|
3
|
|
|
$
|
15
|
|
$
|
(6
|
)
|
$
|
9
|
|
(Gain) loss reclassified to Other Income/Expense
|
2
|
|
—
|
|
2
|
|
|
1
|
|
—
|
|
1
|
|
|
4
|
|
(1
|
)
|
3
|
|
|
(4
|
)
|
2
|
|
(2
|
)
|
||||||||||||
Unrealized gain (loss)
|
(2
|
)
|
1
|
|
(1
|
)
|
|
8
|
|
(3
|
)
|
5
|
|
|
(30
|
)
|
12
|
|
(18
|
)
|
|
7
|
|
(3
|
)
|
4
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Investments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
(Gain) loss reclassified to Other Income/Expense
|
—
|
|
—
|
|
—
|
|
|
—
|
|
—
|
|
—
|
|
|
(1
|
)
|
—
|
|
(1
|
)
|
|
—
|
|
—
|
|
—
|
|
||||||||||||
Unrealized gain (loss)
|
1
|
|
—
|
|
1
|
|
|
(2
|
)
|
1
|
|
(1
|
)
|
|
(2
|
)
|
1
|
|
(1
|
)
|
|
—
|
|
—
|
|
—
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Currency translation:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Translation (gain) loss reclassified to Other Income/Expense
|
—
|
|
—
|
|
—
|
|
|
—
|
|
—
|
|
—
|
|
|
(19
|
)
|
(1
|
)
|
(20
|
)
|
|
—
|
|
—
|
|
—
|
|
||||||||||||
Translation adjustment
|
(33
|
)
|
—
|
|
(33
|
)
|
|
(38
|
)
|
—
|
|
(38
|
)
|
|
(29
|
)
|
—
|
|
(29
|
)
|
|
(8
|
)
|
—
|
|
(8
|
)
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Postretirement benefits
|
1
|
|
—
|
|
1
|
|
|
1
|
|
—
|
|
1
|
|
|
4
|
|
—
|
|
4
|
|
|
3
|
|
—
|
|
3
|
|
||||||||||||
Total Other Comprehensive Income (Loss)
|
$
|
(29
|
)
|
$
|
—
|
|
$
|
(29
|
)
|
|
$
|
(31
|
)
|
$
|
(2
|
)
|
$
|
(33
|
)
|
|
$
|
(68
|
)
|
$
|
9
|
|
$
|
(59
|
)
|
|
$
|
13
|
|
$
|
(7
|
)
|
$
|
6
|
|
|
Three Months Ended
|
|
|
Nine Months Ended
|
|
||||||||||||
|
June 29, 2013
|
|
June 30, 2012
|
|
|
June 29, 2013
|
|
June 30, 2012
|
|
||||||||
Sales:
|
|
|
|
|
|
|
|
|
|
||||||||
Chicken
|
$
|
3,158
|
|
|
$
|
2,855
|
|
|
|
$
|
9,136
|
|
|
$
|
8,410
|
|
|
Beef
|
3,723
|
|
|
3,487
|
|
|
|
10,655
|
|
|
10,323
|
|
|
||||
Pork
|
1,332
|
|
|
1,344
|
|
|
|
4,006
|
|
|
4,191
|
|
|
||||
Prepared Foods
|
797
|
|
|
764
|
|
|
|
2,441
|
|
|
2,432
|
|
|
||||
Other
|
—
|
|
|
24
|
|
|
|
47
|
|
|
124
|
|
|
||||
Intersegment Sales
|
(279
|
)
|
|
(213
|
)
|
|
|
(805
|
)
|
|
(740
|
)
|
|
||||
Total Sales
|
$
|
8,731
|
|
|
$
|
8,261
|
|
|
|
$
|
25,480
|
|
|
$
|
24,740
|
|
|
Operating Income (Loss):
|
|
|
|
|
|
|
|
|
|
||||||||
Chicken
|
$
|
220
|
|
|
$
|
159
|
|
|
|
$
|
471
|
|
|
$
|
346
|
|
|
Beef
|
114
|
|
|
71
|
|
|
|
134
|
|
|
101
|
|
|
||||
Pork
|
67
|
|
|
69
|
|
|
|
264
|
|
|
349
|
|
|
||||
Prepared Foods
|
24
|
|
|
47
|
|
|
|
85
|
|
|
142
|
|
|
||||
Other
|
(6
|
)
|
|
(4
|
)
|
|
|
5
|
|
|
(6
|
)
|
|
||||
Total Operating Income
|
419
|
|
|
342
|
|
|
|
959
|
|
|
932
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||||||
Total Other (Income) Expense
|
34
|
|
|
210
|
|
(b)
|
|
85
|
|
(a)
|
290
|
|
(b)
|
||||
|
|
|
|
|
|
|
|
|
|
||||||||
Income from Continuing Operations before Income Taxes
|
$
|
385
|
|
|
$
|
132
|
|
|
|
$
|
874
|
|
|
$
|
642
|
|
|
(a)
|
Includes
$19 million
related to the recognized currency translation adjustment gain
|
(b)
|
Includes
$167 million
charge related to the early extinguishment of debt
|
•
|
After a trial in the Garcia case involving our Garden City, Kansas facility, a jury verdict in favor of the plaintiffs was entered on March 17, 2011. Exclusive of pre- and post-judgment interest, attorneys’ fees and costs, the jury found violations of federal and state laws for pre- and post-shift work activities and awarded damages in the amount of
$503,011
. Plaintiffs’ counsel filed an application for attorneys’ fees and expenses which we contested. On December 7, 2012, the court granted plaintiffs' counsel's application and awarded a total of
$3,609,723
. We filed an appeal with the Tenth Circuit Court of Appeals on December 27, 2012.
|
•
|
A jury trial was held in the Bouaphakeo case, which involves our Storm Lake, Iowa pork plant, which resulted in a jury verdict in favor of the plaintiffs for violations of federal and state laws for pre- and post-shift work activities. The trial court also awarded the plaintiffs liquidated damages, resulting in total damages awarded in the amount of
$5,784,758
. We have appealed the jury's verdict and trial court's award. The plaintiffs' counsel has also filed an application for attorneys' fees and expenses in the amount of
$2,692,145
.
|
•
|
A jury trial was held in the Guyton case, which involves our Columbus Junction, Iowa pork plant, which resulted in a jury verdict in favor of Tyson on April 25, 2012. The plaintiffs have appealed to the Eighth Circuit Court of Appeals.
|
•
|
The Maxwell case, which involves our Council Bluffs, Iowa plant, has been resolved by the parties for
$970,000
, and all payments required by the settlement have been paid and the claims dismissed.
|
•
|
A bench trial was held in the Acosta case, which involves our Madison, Nebraska pork plant, in January 2013. The trial court filed its findings of fact and conclusions of law on May 31, 2013, and awarded
$5,733,943
for unpaid overtime wages. The court ordered each party to submit an updated back pay calculation reflecting payroll data through the date of its order. A judgment has not yet been entered.
|
•
|
A jury trial in the Gomez case, which involves our Dakota City, Nebraska beef plant, was held, and the jury found in favor of the plaintiffs on April 3, 2013. The trial court has not determined the amount of damages.
|
•
|
The trial court in the Edwards case, which involves the Perry and Waterloo, Iowa facilities, split the case into two trials. The trial involving the Perry facility is scheduled to begin October 7, 2013, and the trial involving the Waterloo facility is scheduled to begin December 9, 2013.
|
•
|
The Carter case, which involves our Logansport, Indiana pork plant, has been resolved by the parties for
$950,000
. The parties' joint motion for approval of the settlement is pending.
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Condensed Consolidating Statement of Income and Comprehensive Income for the three months ended June 29, 2013
|
|
in millions
|
|
||||||||||||||||
|
TFI
Parent |
|
TFM
Parent |
|
Non-
Guarantors |
|
Eliminations
|
|
Total
|
||||||||||
Sales
|
$
|
142
|
|
|
$
|
4,908
|
|
|
$
|
4,081
|
|
|
$
|
(400
|
)
|
|
$
|
8,731
|
|
Cost of Sales
|
8
|
|
|
4,679
|
|
|
3,762
|
|
|
(400
|
)
|
|
8,049
|
|
|||||
Gross Profit
|
134
|
|
|
229
|
|
|
319
|
|
|
—
|
|
|
682
|
|
|||||
Selling, General and Administrative
|
19
|
|
|
54
|
|
|
190
|
|
|
—
|
|
|
263
|
|
|||||
Operating Income
|
115
|
|
|
175
|
|
|
129
|
|
|
—
|
|
|
419
|
|
|||||
Other (Income) Expense:
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense, net
|
9
|
|
|
15
|
|
|
10
|
|
|
—
|
|
|
34
|
|
|||||
Other, net
|
—
|
|
|
(1
|
)
|
|
1
|
|
|
—
|
|
|
—
|
|
|||||
Equity in net earnings of subsidiaries
|
(181
|
)
|
|
(15
|
)
|
|
—
|
|
|
196
|
|
|
—
|
|
|||||
Total Other (Income) Expense
|
(172
|
)
|
|
(1
|
)
|
|
11
|
|
|
196
|
|
|
34
|
|
|||||
Income from Continuing Operations before Income Taxes
|
287
|
|
|
176
|
|
|
118
|
|
|
(196
|
)
|
|
385
|
|
|||||
Income Tax Expense
|
38
|
|
|
56
|
|
|
42
|
|
|
—
|
|
|
136
|
|
|||||
Income from Continuing Operations
|
249
|
|
|
120
|
|
|
76
|
|
|
(196
|
)
|
|
249
|
|
|||||
Loss from Discontinued Operation, Net of Tax
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
|
(4
|
)
|
|||||
Net Income
|
249
|
|
|
120
|
|
|
72
|
|
|
(196
|
)
|
|
245
|
|
|||||
Less: Net Income (Loss) Attributable to Noncontrolling Interest
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
|
(4
|
)
|
|||||
Net Income Attributable to Tyson
|
$
|
249
|
|
|
$
|
120
|
|
|
$
|
76
|
|
|
$
|
(196
|
)
|
|
$
|
249
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Comprehensive Income (Loss)
|
216
|
|
|
103
|
|
|
49
|
|
|
(152
|
)
|
|
216
|
|
|||||
Less: Comprehensive Income (Loss) Attributable to Noncontrolling Interest
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
|
(4
|
)
|
|||||
Comprehensive Income (Loss) Attributable to Tyson
|
$
|
216
|
|
|
$
|
103
|
|
|
$
|
53
|
|
|
$
|
(152
|
)
|
|
$
|
220
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Condensed Consolidating Statement of Income and Comprehensive Income for the three months ended June 30, 2012
|
|
in millions
|
|
||||||||||||||||
|
TFI
Parent |
|
TFM
Parent |
|
Non-
Guarantors |
|
Eliminations
|
|
Total
|
||||||||||
Sales
|
$
|
140
|
|
|
$
|
4,711
|
|
|
$
|
3,764
|
|
|
$
|
(354
|
)
|
|
$
|
8,261
|
|
Cost of Sales
|
20
|
|
|
4,536
|
|
|
3,493
|
|
|
(354
|
)
|
|
7,695
|
|
|||||
Gross Profit
|
120
|
|
|
175
|
|
|
271
|
|
|
—
|
|
|
566
|
|
|||||
Selling, General and Administrative
|
4
|
|
|
49
|
|
|
170
|
|
|
1
|
|
|
224
|
|
|||||
Operating Income
|
116
|
|
|
126
|
|
|
101
|
|
|
(1
|
)
|
|
342
|
|
|||||
Other (Income) Expense:
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense, net
|
50
|
|
|
70
|
|
|
93
|
|
|
—
|
|
|
213
|
|
|||||
Other, net
|
1
|
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
|
(3
|
)
|
|||||
Equity in net earnings of subsidiaries
|
(34
|
)
|
|
—
|
|
|
—
|
|
|
34
|
|
|
—
|
|
|||||
Total Other (Income) Expense
|
17
|
|
|
70
|
|
|
89
|
|
|
34
|
|
|
210
|
|
|||||
Income from Continuing Operations before Income Taxes
|
99
|
|
|
56
|
|
|
12
|
|
|
(35
|
)
|
|
132
|
|
|||||
Income Tax Expense
|
23
|
|
|
19
|
|
|
11
|
|
|
—
|
|
|
53
|
|
|||||
Income from Continuing Operations
|
76
|
|
|
37
|
|
|
1
|
|
|
(35
|
)
|
|
79
|
|
|||||
Loss from Discontinued Operation, Net of Tax
|
—
|
|
|
—
|
|
|
(6
|
)
|
|
—
|
|
|
(6
|
)
|
|||||
Net Income
|
76
|
|
|
37
|
|
|
(5
|
)
|
|
(35
|
)
|
|
73
|
|
|||||
Less: Net Income (Loss) Attributable to Noncontrolling Interest
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
(3
|
)
|
|||||
Net Income Attributable to Tyson
|
76
|
|
|
37
|
|
|
(2
|
)
|
|
(35
|
)
|
|
76
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Comprehensive Income (Loss)
|
43
|
|
|
18
|
|
|
(29
|
)
|
|
8
|
|
|
40
|
|
|||||
Less: Comprehensive Income (Loss) Attributable to Noncontrolling Interest
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
(3
|
)
|
|||||
Comprehensive Income (Loss) Attributable to Tyson
|
$
|
43
|
|
|
$
|
18
|
|
|
$
|
(26
|
)
|
|
$
|
8
|
|
|
$
|
43
|
|
Condensed Consolidating Statement of Income and Comprehensive Income for the nine months ended June 29, 2013
|
|
in millions
|
|
||||||||||||||||
|
TFI
Parent |
|
TFM
Parent |
|
Non-
Guarantors |
|
Eliminations
|
|
Total
|
||||||||||
Sales
|
$
|
318
|
|
|
$
|
14,210
|
|
|
$
|
11,957
|
|
|
$
|
(1,005
|
)
|
|
$
|
25,480
|
|
Cost of Sales
|
35
|
|
|
13,696
|
|
|
11,065
|
|
|
(1,005
|
)
|
|
23,791
|
|
|||||
Gross Profit
|
283
|
|
|
514
|
|
|
892
|
|
|
—
|
|
|
1,689
|
|
|||||
Selling, General and Administrative
|
51
|
|
|
151
|
|
|
528
|
|
|
—
|
|
|
730
|
|
|||||
Operating Income
|
232
|
|
|
363
|
|
|
364
|
|
|
—
|
|
|
959
|
|
|||||
Other (Income) Expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Interest expense, net
|
26
|
|
|
46
|
|
|
32
|
|
|
—
|
|
|
104
|
|
|||||
Other, net
|
4
|
|
|
(1
|
)
|
|
(22
|
)
|
|
—
|
|
|
(19
|
)
|
|||||
Equity in net earnings of subsidiaries
|
(381
|
)
|
|
(29
|
)
|
|
—
|
|
|
410
|
|
|
—
|
|
|||||
Total Other (Income) Expense
|
(351
|
)
|
|
16
|
|
|
10
|
|
|
410
|
|
|
85
|
|
|||||
Income from Continuing Operations before Income Taxes
|
583
|
|
|
347
|
|
|
354
|
|
|
(410
|
)
|
|
874
|
|
|||||
Income Tax Expense
|
66
|
|
|
109
|
|
|
110
|
|
|
—
|
|
|
285
|
|
|||||
Income from Continuing Operations
|
517
|
|
|
238
|
|
|
244
|
|
|
(410
|
)
|
|
589
|
|
|||||
Loss from Discontinued Operation, Net of Tax
|
—
|
|
|
—
|
|
|
(70
|
)
|
|
—
|
|
|
(70
|
)
|
|||||
Net Income
|
517
|
|
|
238
|
|
|
174
|
|
|
(410
|
)
|
|
519
|
|
|||||
Less: Net Income (Loss) Attributable to Noncontrolling Interest
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
2
|
|
|||||
Net Income Attributable to Tyson
|
$
|
517
|
|
|
$
|
238
|
|
|
$
|
172
|
|
|
$
|
(410
|
)
|
|
$
|
517
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Comprehensive Income (Loss)
|
460
|
|
|
202
|
|
|
80
|
|
|
(282
|
)
|
|
460
|
|
|||||
Less: Comprehensive Income (Loss) Attributable to Noncontrolling Interest
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
2
|
|
|||||
Comprehensive Income (Loss) Attributable to Tyson
|
$
|
460
|
|
|
$
|
202
|
|
|
$
|
78
|
|
|
$
|
(282
|
)
|
|
$
|
458
|
|
Condensed Consolidating Statement of Income and Comprehensive Income for the nine months ended June 30, 2012
|
|
in millions
|
|
||||||||||||||||
|
TFI
Parent |
|
TFM
Parent |
|
Non-
Guarantors |
|
Eliminations
|
|
Total
|
||||||||||
Sales
|
$
|
268
|
|
|
$
|
14,172
|
|
|
$
|
11,273
|
|
|
$
|
(973
|
)
|
|
$
|
24,740
|
|
Cost of Sales
|
12
|
|
|
13,647
|
|
|
10,453
|
|
|
(972
|
)
|
|
23,140
|
|
|||||
Gross Profit
|
256
|
|
|
525
|
|
|
820
|
|
|
(1
|
)
|
|
1,600
|
|
|||||
Selling, General and Administrative
|
25
|
|
|
156
|
|
|
488
|
|
|
(1
|
)
|
|
668
|
|
|||||
Operating Income
|
231
|
|
|
369
|
|
|
332
|
|
|
—
|
|
|
932
|
|
|||||
Other (Income) Expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Interest expense, net
|
39
|
|
|
126
|
|
|
142
|
|
|
—
|
|
|
307
|
|
|||||
Other, net
|
1
|
|
|
—
|
|
|
(18
|
)
|
|
—
|
|
|
(17
|
)
|
|||||
Equity in net earnings of subsidiaries
|
(268
|
)
|
|
(55
|
)
|
|
—
|
|
|
323
|
|
|
—
|
|
|||||
Total Other (Income) Expense
|
(228
|
)
|
|
71
|
|
|
124
|
|
|
323
|
|
|
290
|
|
|||||
Income from Continuing Operations before Income Taxes
|
459
|
|
|
298
|
|
|
208
|
|
|
(323
|
)
|
|
642
|
|
|||||
Income Tax Expense
|
61
|
|
|
83
|
|
|
87
|
|
|
—
|
|
|
231
|
|
|||||
Income from Continuing Operations
|
398
|
|
|
215
|
|
|
121
|
|
|
(323
|
)
|
|
411
|
|
|||||
Loss from Discontinued Operation, Net of Tax
|
—
|
|
|
—
|
|
|
(16
|
)
|
|
—
|
|
|
(16
|
)
|
|||||
Net Income
|
398
|
|
|
215
|
|
|
105
|
|
|
(323
|
)
|
|
395
|
|
|||||
Less: Net Income (Loss) Attributable to Noncontrolling Interest
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
(3
|
)
|
|||||
Net Income Attributable to Tyson
|
$
|
398
|
|
|
$
|
215
|
|
|
$
|
108
|
|
|
$
|
(323
|
)
|
|
$
|
398
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Comprehensive Income (Loss)
|
404
|
|
|
223
|
|
|
110
|
|
|
(336
|
)
|
|
401
|
|
|||||
Less: Comprehensive Income (Loss) Attributable to Noncontrolling Interest
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
(3
|
)
|
|||||
Comprehensive Income (Loss) Attributable to Tyson
|
$
|
404
|
|
|
$
|
223
|
|
|
$
|
113
|
|
|
$
|
(336
|
)
|
|
$
|
404
|
|
Condensed Consolidating Balance Sheet as of June 29, 2013
|
|
in millions
|
|
||||||||||||||||
|
TFI
Parent |
|
TFM
Parent |
|
Non-
Guarantors |
|
Eliminations
|
|
Total
|
||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
||||||||||
Current Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
—
|
|
|
$
|
13
|
|
|
$
|
930
|
|
|
$
|
—
|
|
|
$
|
943
|
|
Accounts receivable, net
|
—
|
|
|
589
|
|
|
865
|
|
|
—
|
|
|
1,454
|
|
|||||
Inventories
|
1
|
|
|
1,024
|
|
|
1,876
|
|
|
—
|
|
|
2,901
|
|
|||||
Other current assets
|
370
|
|
|
55
|
|
|
216
|
|
|
(412
|
)
|
|
229
|
|
|||||
Total Current Assets
|
371
|
|
|
1,681
|
|
|
3,887
|
|
|
(412
|
)
|
|
5,527
|
|
|||||
Net Property, Plant and Equipment
|
31
|
|
|
877
|
|
|
3,134
|
|
|
—
|
|
|
4,042
|
|
|||||
Goodwill
|
—
|
|
|
881
|
|
|
1,022
|
|
|
—
|
|
|
1,903
|
|
|||||
Intangible Assets
|
—
|
|
|
22
|
|
|
121
|
|
|
—
|
|
|
143
|
|
|||||
Other Assets
|
909
|
|
|
159
|
|
|
249
|
|
|
(830
|
)
|
|
487
|
|
|||||
Investment in Subsidiaries
|
11,756
|
|
|
2,008
|
|
|
—
|
|
|
(13,764
|
)
|
|
—
|
|
|||||
Total Assets
|
$
|
13,067
|
|
|
$
|
5,628
|
|
|
$
|
8,413
|
|
|
$
|
(15,006
|
)
|
|
$
|
12,102
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Liabilities and Shareholders’ Equity
|
|
|
|
|
|
|
|
|
|
||||||||||
Current Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Current debt
|
$
|
452
|
|
|
$
|
132
|
|
|
$
|
251
|
|
|
$
|
(327
|
)
|
|
$
|
508
|
|
Accounts payable
|
20
|
|
|
577
|
|
|
712
|
|
|
—
|
|
|
1,309
|
|
|||||
Other current liabilities
|
4,467
|
|
|
186
|
|
|
916
|
|
|
(4,448
|
)
|
|
1,121
|
|
|||||
Total Current Liabilities
|
4,939
|
|
|
895
|
|
|
1,879
|
|
|
(4,775
|
)
|
|
2,938
|
|
|||||
Long-Term Debt
|
1,770
|
|
|
679
|
|
|
246
|
|
|
(796
|
)
|
|
1,899
|
|
|||||
Deferred Income Taxes
|
—
|
|
|
131
|
|
|
342
|
|
|
(6
|
)
|
|
467
|
|
|||||
Other Liabilities
|
145
|
|
|
144
|
|
|
290
|
|
|
(28
|
)
|
|
551
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Total Tyson Shareholders’ Equity
|
6,213
|
|
|
3,779
|
|
|
5,622
|
|
|
(9,401
|
)
|
|
6,213
|
|
|||||
Noncontrolling Interest
|
—
|
|
|
—
|
|
|
34
|
|
|
—
|
|
|
34
|
|
|||||
Total Shareholders’ Equity
|
6,213
|
|
|
3,779
|
|
|
5,656
|
|
|
(9,401
|
)
|
|
6,247
|
|
|||||
Total Liabilities and Shareholders’ Equity
|
$
|
13,067
|
|
|
$
|
5,628
|
|
|
$
|
8,413
|
|
|
$
|
(15,006
|
)
|
|
$
|
12,102
|
|
Condensed Consolidating Balance Sheet as of September 29, 2012
|
|
in millions
|
|
||||||||||||||||
|
TFI
Parent |
|
TFM
Parent |
|
Non-
Guarantors |
|
Eliminations
|
|
Total
|
||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
||||||||||
Current Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
1
|
|
|
$
|
9
|
|
|
$
|
1,061
|
|
|
$
|
—
|
|
|
$
|
1,071
|
|
Accounts receivable, net
|
1
|
|
|
499
|
|
|
878
|
|
|
—
|
|
|
1,378
|
|
|||||
Inventories
|
—
|
|
|
950
|
|
|
1,859
|
|
|
—
|
|
|
2,809
|
|
|||||
Other current assets
|
139
|
|
|
100
|
|
|
90
|
|
|
(184
|
)
|
|
145
|
|
|||||
Total Current Assets
|
141
|
|
|
1,558
|
|
|
3,888
|
|
|
(184
|
)
|
|
5,403
|
|
|||||
Net Property, Plant and Equipment
|
31
|
|
|
873
|
|
|
3,118
|
|
|
—
|
|
|
4,022
|
|
|||||
Goodwill
|
—
|
|
|
881
|
|
|
1,010
|
|
|
—
|
|
|
1,891
|
|
|||||
Intangible Assets
|
—
|
|
|
26
|
|
|
103
|
|
|
—
|
|
|
129
|
|
|||||
Other Assets
|
1,257
|
|
|
151
|
|
|
251
|
|
|
(1,208
|
)
|
|
451
|
|
|||||
Investment in Subsidiaries
|
11,849
|
|
|
2,005
|
|
|
—
|
|
|
(13,854
|
)
|
|
—
|
|
|||||
Total Assets
|
$
|
13,278
|
|
|
$
|
5,494
|
|
|
$
|
8,370
|
|
|
$
|
(15,246
|
)
|
|
$
|
11,896
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Liabilities and Shareholders’ Equity
|
|
|
|
|
|
|
|
|
|
||||||||||
Current Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Current debt
|
$
|
439
|
|
|
$
|
—
|
|
|
$
|
167
|
|
|
$
|
(91
|
)
|
|
$
|
515
|
|
Accounts payable
|
10
|
|
|
558
|
|
|
804
|
|
|
—
|
|
|
1,372
|
|
|||||
Other current liabilities
|
4,887
|
|
|
144
|
|
|
766
|
|
|
(4,854
|
)
|
|
943
|
|
|||||
Total Current Liabilities
|
5,336
|
|
|
702
|
|
|
1,737
|
|
|
(4,945
|
)
|
|
2,830
|
|
|||||
Long-Term Debt
|
1,774
|
|
|
809
|
|
|
486
|
|
|
(1,152
|
)
|
|
1,917
|
|
|||||
Deferred Income Taxes
|
—
|
|
|
135
|
|
|
432
|
|
|
(9
|
)
|
|
558
|
|
|||||
Other Liabilities
|
156
|
|
|
146
|
|
|
294
|
|
|
(47
|
)
|
|
549
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Total Tyson Shareholders’ Equity
|
6,012
|
|
|
3,702
|
|
|
5,391
|
|
|
(9,093
|
)
|
|
6,012
|
|
|||||
Noncontrolling Interest
|
—
|
|
|
—
|
|
|
30
|
|
|
—
|
|
|
30
|
|
|||||
Total Shareholders’ Equity
|
6,012
|
|
|
3,702
|
|
|
5,421
|
|
|
(9,093
|
)
|
|
6,042
|
|
|||||
Total Liabilities and Shareholders’ Equity
|
$
|
13,278
|
|
|
$
|
5,494
|
|
|
$
|
8,370
|
|
|
$
|
(15,246
|
)
|
|
$
|
11,896
|
|
Condensed Consolidating Statement of Cash Flows for the nine months ended June 29, 2013
|
|
in millions
|
|
||||||||||||||||
|
TFI
Parent |
|
TFM
Parent |
|
Non-
Guarantors |
|
Eliminations
|
|
Total
|
||||||||||
Cash Provided by (Used for) Operating Activities
|
$
|
185
|
|
|
$
|
196
|
|
|
$
|
404
|
|
|
$
|
(13
|
)
|
|
$
|
772
|
|
Cash Flows from Investing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Additions to property, plant and equipment
|
(3
|
)
|
|
(82
|
)
|
|
(340
|
)
|
|
—
|
|
|
(425
|
)
|
|||||
(Purchases of)/Proceeds from marketable securities, net
|
—
|
|
|
(14
|
)
|
|
(87
|
)
|
|
—
|
|
|
(101
|
)
|
|||||
Acquisitions, net of cash acquired
|
—
|
|
|
—
|
|
|
(106
|
)
|
|
—
|
|
|
(106
|
)
|
|||||
Other, net
|
(3
|
)
|
|
9
|
|
|
30
|
|
|
—
|
|
|
36
|
|
|||||
Cash Provided by (Used for) Investing Activities
|
(6
|
)
|
|
(87
|
)
|
|
(503
|
)
|
|
—
|
|
|
(596
|
)
|
|||||
Cash Flows from Financing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net change in debt
|
—
|
|
|
—
|
|
|
(21
|
)
|
|
—
|
|
|
(21
|
)
|
|||||
Purchases of Tyson Class A common stock
|
(298
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(298
|
)
|
|||||
Dividends
|
(87
|
)
|
|
—
|
|
|
(13
|
)
|
|
13
|
|
|
(87
|
)
|
|||||
Stock options exercised
|
93
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
93
|
|
|||||
Other, net
|
13
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
13
|
|
|||||
Net change in intercompany balances
|
99
|
|
|
(105
|
)
|
|
6
|
|
|
—
|
|
|
—
|
|
|||||
Cash Provided by (Used for) Financing Activities
|
(180
|
)
|
|
(105
|
)
|
|
(28
|
)
|
|
13
|
|
|
(300
|
)
|
|||||
Effect of Exchange Rate Changes on Cash
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
|
(4
|
)
|
|||||
Increase (Decrease) in Cash and Cash Equivalents
|
(1
|
)
|
|
4
|
|
|
(131
|
)
|
|
—
|
|
|
(128
|
)
|
|||||
Cash and Cash Equivalents at Beginning of Year
|
1
|
|
|
9
|
|
|
1,061
|
|
|
—
|
|
|
1,071
|
|
|||||
Cash and Cash Equivalents at End of Period
|
$
|
—
|
|
|
$
|
13
|
|
|
$
|
930
|
|
|
$
|
—
|
|
|
$
|
943
|
|
Condensed Consolidating Statement of Cash Flows for the nine months ended June 30, 2012
|
|
in millions
|
|
||||||||||||||||
|
TFI
Parent |
|
TFM
Parent |
|
Non-
Guarantors |
|
Eliminations
|
|
Total
|
||||||||||
Cash Provided by (Used for) Operating Activities
|
$
|
280
|
|
|
$
|
237
|
|
|
$
|
212
|
|
|
$
|
(10
|
)
|
|
$
|
719
|
|
Cash Flows from Investing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Additions to property, plant and equipment
|
(1
|
)
|
|
(78
|
)
|
|
(451
|
)
|
|
—
|
|
|
(530
|
)
|
|||||
(Purchases of)/Proceeds from marketable securities, net
|
—
|
|
|
(7
|
)
|
|
(2
|
)
|
|
—
|
|
|
(9
|
)
|
|||||
Acquisitions, net of cash acquired
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Other, net
|
2
|
|
|
5
|
|
|
12
|
|
|
—
|
|
|
19
|
|
|||||
Cash Provided by (Used for) Investing Activities
|
1
|
|
|
(80
|
)
|
|
(441
|
)
|
|
—
|
|
|
(520
|
)
|
|||||
Cash Flows from Financing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net change in debt
|
131
|
|
|
—
|
|
|
32
|
|
|
—
|
|
|
163
|
|
|||||
Purchases of Tyson Class A common stock
|
(209
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(209
|
)
|
|||||
Dividends
|
(44
|
)
|
|
—
|
|
|
(10
|
)
|
|
10
|
|
|
(44
|
)
|
|||||
Stock options exercised
|
32
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
32
|
|
|||||
Other, net
|
(5
|
)
|
|
—
|
|
|
(21
|
)
|
|
—
|
|
|
(26
|
)
|
|||||
Net change in intercompany balances
|
(186
|
)
|
|
(158
|
)
|
|
344
|
|
|
—
|
|
|
—
|
|
|||||
Cash Provided by (Used for) Financing Activities
|
(281
|
)
|
|
(158
|
)
|
|
345
|
|
|
10
|
|
|
(84
|
)
|
|||||
Effect of Exchange Rate Changes on Cash
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
(3
|
)
|
|||||
Increase (Decrease) in Cash and Cash Equivalents
|
—
|
|
|
(1
|
)
|
|
113
|
|
|
—
|
|
|
112
|
|
|||||
Cash and Cash Equivalents at Beginning of Year
|
1
|
|
|
1
|
|
|
714
|
|
|
—
|
|
|
716
|
|
|||||
Cash and Cash Equivalents at End of Period
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
827
|
|
|
$
|
—
|
|
|
$
|
828
|
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
•
|
General – We had strong operating income in the third quarter of fiscal 2013, which was led by record earnings in our Chicken segment and a rebound in our Beef segment.
|
•
|
We continued to execute our strategy of accelerating growth in domestic value-added chicken sales, prepared food sales and international chicken production, innovating products, services and customer insights and cultivating our talent development to support Tyson's growth and future.
|
•
|
We also maintained focus on maximizing our margins through margin management and operational efficiency improvements. Margin management improvements occurred in the areas of mix, export sales, price optimization and value-added product initiatives. The operational efficiencies occurred in areas of yields, chicken live performance, cost reduction and labor management.
|
•
|
Market environment – Our Chicken segment delivered record results in the third quarter of fiscal 2013 driven by strong demand and favorable domestic market conditions. The Chicken segment experienced increased feed costs but was able to offset the impact with operational, mix and price improvements. Our Beef segment's operating performance rebounded in the third quarter of fiscal 2013 due to improved operational execution and less volatile live cattle markets. Our Pork segment results were down slightly in the third quarter of fiscal 2013 due to decreased volumes as a result of balancing our supply with customer demand and reduced exports. Our Prepared Foods segment was challenged by product mix and rapidly increasing raw material prices.
|
•
|
Discontinued Operation - After conducting an assessment during fiscal 2013 of our long-term business strategy in China, we determined our Weifang operation (Weifang), which was part of our Chicken segment, was no longer core to the execution of our strategy given the capital investment it required to execute our future business plan. In the third quarter we entered into an agreement to sell Weifang, which was subsequently completed in July 2013. Weifang's results are reported as a discontinued operation for all periods presented.
|
•
|
Our total operating margins were
4.8%
in the
third
quarter of fiscal
2013
. The following is a summary of operating margins by segment:
|
•
|
Debt and Liquidity – During the
third
quarter of fiscal 2013, we generated
$542 million
of operating cash flows. Additionally, we repurchased, as part of our share repurchase program,
4 million
shares of our Class A common stock for
$100 million
. At
June 29, 2013
, we had approximately
$2 billion
of liquidity, which includes availability under our credit facility,
$943 million
of cash and cash equivalents and
$81 million
of short-term investments.
|
in millions, except per share data
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
June 29, 2013
|
|
June 30, 2012
|
|
June 29, 2013
|
|
June 30, 2012
|
||||||||
Net income from continuing operations attributable to Tyson
|
$
|
253
|
|
|
$
|
82
|
|
|
$
|
587
|
|
|
$
|
414
|
|
Net income from continuing operations attributable to Tyson – per diluted share
|
0.69
|
|
|
0.22
|
|
|
1.61
|
|
|
1.11
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Net loss from discontinued operation attributable to Tyson
|
(4
|
)
|
|
(6
|
)
|
|
(70
|
)
|
|
(16
|
)
|
||||
Net loss from discontinued operation attributable to Tyson – per diluted share
|
(0.01
|
)
|
|
(0.01
|
)
|
|
(0.19
|
)
|
|
(0.04
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Net income attributable to Tyson
|
249
|
|
|
76
|
|
|
517
|
|
|
398
|
|
||||
Net income attributable to Tyson – per diluted share
|
0.68
|
|
|
0.21
|
|
|
1.42
|
|
|
1.07
|
|
•
|
$19 million, or $0.05 per diluted share, related to a recognized currency translation adjustment gain
|
•
|
$167 million pretax charge, or $0.29 per diluted share, related to the early extinguishment of debt
|
in millions
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
June 29, 2013
|
|
June 30, 2012
|
|
June 29, 2013
|
|
June 30, 2012
|
||||||||
Sales
|
$
|
8,731
|
|
|
$
|
8,261
|
|
|
$
|
25,480
|
|
|
$
|
24,740
|
|
Change in sales volume
|
2.2
|
%
|
|
|
|
(0.7
|
)%
|
|
|
||||||
Change in average sales price
|
3.7
|
%
|
|
|
|
4.1
|
%
|
|
|
||||||
Sales growth
|
5.7
|
%
|
|
|
|
3.0
|
%
|
|
|
•
|
Average Sales Price
– Sales were positively impacted by higher average sales prices, which accounted for an increase of $286 million. All segments experienced increased average sales prices, largely due to continued tight domestic availability of protein and increased live and raw material costs.
|
•
|
Sales Volume
– Sales were positively impacted by higher sales volume, which accounted for an increase of $184 million. All segments, with the exception of the Pork segment, had an increase in sales volume.
|
•
|
Average Sales Price
– Sales were positively impacted by higher average sales prices, which accounted for an increase of $864 million. The Chicken and Beef segments experienced increased average sales prices, largely due to continued tight domestic availability of protein and increased live and raw material costs, partially offset by a decrease in average sales price in the Pork segment which was driven by lower live and raw material costs.
|
•
|
Sales Volume
– Sales were negatively impacted by lower sales volume, which accounted for a decrease of $124 million. The Beef and Pork segments experienced lower sales volumes, partially offset by increases in sales volume in the Chicken and Prepared Foods segments.
|
in millions
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
June 29, 2013
|
|
June 30, 2012
|
|
June 29, 2013
|
|
June 30, 2012
|
||||||||
Cost of sales
|
$
|
8,049
|
|
|
$
|
7,695
|
|
|
$
|
23,791
|
|
|
$
|
23,140
|
|
Gross margin
|
$
|
682
|
|
|
$
|
566
|
|
|
$
|
1,689
|
|
|
$
|
1,600
|
|
Cost of sales as a percentage of sales
|
92.2
|
%
|
|
93.1
|
%
|
|
93.4
|
%
|
|
93.5
|
%
|
•
|
Cost of sales increased $354 million. Higher input cost per pound increased cost of sales $183 million, while higher sales volume increased cost of sales $171 million.
|
•
|
The $183 million impact of higher input cost per pound was primarily driven by:
|
•
|
Increases in live cattle and live hog costs of $85 million and $20 million, respectively.
|
•
|
Increase in feed costs of $105 million in our Chicken segment.
|
•
|
The $171 million impact of higher sales volume was driven by increases in sales volume in our Chicken, Beef, and Prepared Foods segments, partially offset by a decrease in sales volume in our Pork segment.
|
•
|
Cost of sales increased $651 million. Higher input cost per pound increased cost of sales $792 million, while lower sales volume decreased cost of sales $141 million.
|
•
|
The $792 million impact of higher input cost per pound was primarily driven by:
|
•
|
Increase in live cattle costs of $350 million, partially offset by a decrease in live hog costs of $80 million.
|
•
|
Increase in feed costs of $440 million in our Chicken segment.
|
•
|
The $141 million impact of lower sales volume was driven by decreases in sales volume in our Beef and Pork segments, partially offset by increases in sales volume in our Chicken and Prepared Foods segment.
|
in millions
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
June 29, 2013
|
|
June 30, 2012
|
|
June 29, 2013
|
|
June 30, 2012
|
||||||||
Selling, general and administrative expense
|
$
|
263
|
|
|
$
|
224
|
|
|
$
|
730
|
|
|
$
|
668
|
|
As a percentage of sales
|
3.0
|
%
|
|
2.7
|
%
|
|
2.9
|
%
|
|
2.7
|
%
|
•
|
Increase of $22 million related to employee costs including payroll and stock-based and incentive-based compensation.
|
•
|
Increase of $13 million related to advertising and sales promotions.
|
•
|
Increase of $30 million related to employee costs including payroll and stock-based and incentive-based compensation.
|
•
|
Increase of $25 million related to advertising and sales promotions.
|
•
|
Increase of $7 million primarily related to reduced investment returns on deferred compensation plans.
|
in millions
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
June 29, 2013
|
|
June 30, 2012
|
|
June 29, 2013
|
|
June 30, 2012
|
||||||||
Cash interest expense
|
$
|
29
|
|
|
$
|
39
|
|
|
$
|
88
|
|
|
$
|
120
|
|
Loss on early extinguishment of debt
|
—
|
|
|
167
|
|
|
—
|
|
|
167
|
|
||||
Non-cash interest expense
|
7
|
|
|
9
|
|
|
21
|
|
|
29
|
|
||||
Total Interest Expense
|
$
|
36
|
|
|
$
|
215
|
|
|
$
|
109
|
|
|
$
|
316
|
|
•
|
Cash interest expense includes interest expense related to the coupon rates for senior notes and commitment/letter of credit fees incurred on our revolving credit facilities. The decrease is due to lower average coupon rates for our senior notes compared to fiscal 2012.
|
•
|
Loss on early extinguishment of debt during the third quarter and nine months of fiscal 2012 include the amount paid exceeding the par value of debt, unamortized discount and unamortized debt issuance costs related to the completion of our tender offer to purchase any and all of the outstanding 10.50% Senior Notes due 2014 (2014 Notes).
|
•
|
Non-cash interest expense primarily includes interest related to the amortization of debt issuance costs and discounts/premiums on note issuances.
|
in millions
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
June 29, 2013
|
|
June 30, 2012
|
|
June 29, 2013
|
|
June 30, 2012
|
||||||||
|
$
|
—
|
|
|
$
|
(3
|
)
|
|
$
|
(19
|
)
|
|
$
|
(17
|
)
|
•
|
Included $19 million related to a currency translation adjustment gain recognized in conjunction with the receipt of proceeds constituting the final resolution of our investment in Canada.
|
•
|
Included $11 million of equity earnings in joint ventures and $4 million in net foreign currency exchange gains.
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||
|
June 29, 2013
|
|
June 30, 2012
|
|
June 29, 2013
|
|
June 30, 2012
|
||||
|
35.4
|
%
|
|
40.2
|
%
|
|
32.6
|
%
|
|
35.9
|
%
|
•
|
state income taxes;
|
•
|
the domestic production deduction; and
|
•
|
losses in foreign jurisdictions for which no benefit is recognized.
|
•
|
state income taxes;
|
•
|
the domestic production deduction; and
|
•
|
losses in foreign jurisdictions for which no benefit is recognized.
|
in millions
|
Sales
|
||||||||||||||
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
June 29, 2013
|
|
June 30, 2012
|
|
June 29, 2013
|
|
June 30, 2012
|
||||||||
Chicken
|
$
|
3,158
|
|
|
$
|
2,855
|
|
|
$
|
9,136
|
|
|
$
|
8,410
|
|
Beef
|
3,723
|
|
|
3,487
|
|
|
10,655
|
|
|
10,323
|
|
||||
Pork
|
1,332
|
|
|
1,344
|
|
|
4,006
|
|
|
4,191
|
|
||||
Prepared Foods
|
797
|
|
|
764
|
|
|
2,441
|
|
|
2,432
|
|
||||
Other
|
—
|
|
|
24
|
|
|
47
|
|
|
124
|
|
||||
Intersegment Sales
|
(279
|
)
|
|
(213
|
)
|
|
(805
|
)
|
|
(740
|
)
|
||||
Total
|
$
|
8,731
|
|
|
$
|
8,261
|
|
|
$
|
25,480
|
|
|
$
|
24,740
|
|
in millions
|
Operating Income (Loss)
|
||||||||||||||
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
June 29, 2013
|
|
June 30, 2012
|
|
June 29, 2013
|
|
June 30, 2012
|
||||||||
Chicken
|
$
|
220
|
|
|
$
|
159
|
|
|
$
|
471
|
|
|
$
|
346
|
|
Beef
|
114
|
|
|
71
|
|
|
134
|
|
|
101
|
|
||||
Pork
|
67
|
|
|
69
|
|
|
264
|
|
|
349
|
|
||||
Prepared Foods
|
24
|
|
|
47
|
|
|
85
|
|
|
142
|
|
||||
Other
|
(6
|
)
|
|
(4
|
)
|
|
5
|
|
|
(6
|
)
|
||||
Total
|
$
|
419
|
|
|
$
|
342
|
|
|
$
|
959
|
|
|
$
|
932
|
|
•
|
Sales and Operating Income –
|
•
|
Sales Volume – Sales volume grew due to increased domestic and international production driven by stronger demand for chicken products.
|
•
|
Average Sales Price – The increase in average sales price in the third quarter and nine months of fiscal 2013 was primarily due to mix changes and price increases associated with higher input costs. Since many of our sales contracts are formula based or shorter-term in nature, we were able to offset rising input costs through improved pricing and mix.
|
•
|
Operating Income – Operating income was positively impacted by increased average sales price and volume, improved live performance and operational execution, as well as improved performance in our foreign-produced operations. These increases were partially offset by increased feed costs of $105 million and $440 million for the third quarter and nine months of fiscal 2013, respectively.
|
•
|
Sales and Operating Income –
|
•
|
Fed cattle supplies decreased which drove up average sales price and livestock cost. Sales volumes increased in the third quarter due to increased demand for our beef products. Sales volumes decreased in the nine months of fiscal 2013 due to a reduction in outside trim and tallow purchases. Operating income increased in the third quarter and nine months of fiscal 2013 due to improved operational execution and less volatile live cattle markets.
|
•
|
Sales and Operating Income –
|
•
|
For the third quarter of fiscal 2013, demand for pork products improved, which drove up average sales price and livestock cost despite a slight increase in live hog supplies. For the nine months of fiscal 2013, live hog supplies increased, which drove down average sales price and livestock cost. Sales volumes decreased as a result of balancing our supply with customer demand and reduced exports. While reduced compared to prior year, operating income remained strong in the nine months of fiscal 2013 despite brief periods of imbalance in industry supply and customer demand.
|
•
|
Derivative Activities – Operating results in fiscal 2012 included gains of $18 million and $51 million for the three and nine months ended, respectively, for commodity risk management activities related to futures contracts. These amounts exclude the impact from related physical sale and purchase transactions, which impact current and future period operating results. Our operating results in fiscal 2013 were not significantly impacted by these activities.
|
in millions
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||||||||||
|
June 29, 2013
|
|
June 30, 2012
|
|
Change
|
|
June 29, 2013
|
|
June 30, 2012
|
|
Change
|
||||||||||||
Sales
|
$
|
797
|
|
|
$
|
764
|
|
|
$
|
33
|
|
|
$
|
2,441
|
|
|
$
|
2,432
|
|
|
$
|
9
|
|
Sales Volume Change
|
|
|
|
|
1.3
|
%
|
|
|
|
|
|
0.8
|
%
|
||||||||||
Average Sales Price Change
|
|
|
|
|
3.0
|
%
|
|
|
|
|
|
(0.4
|
)%
|
||||||||||
Operating Income
|
$
|
24
|
|
|
$
|
47
|
|
|
$
|
(23
|
)
|
|
$
|
85
|
|
|
$
|
142
|
|
|
$
|
(57
|
)
|
Operating Margin
|
3.0
|
%
|
|
6.2
|
%
|
|
|
|
3.5
|
%
|
|
5.8
|
%
|
|
|
•
|
Sales and Operating Income –
|
•
|
Operating income decreased, despite increased sales volumes, as the result of product mix, increased raw material costs and additional costs incurred as we invested in our lunchmeat business. Because many of our sales contracts are formula based or shorter-term in nature, we are typically able to offset rising input costs through pricing. However, there is a lag time for price increases to take effect.
|
•
|
Chicken
– Current USDA data shows U.S. chicken production to increase 2-3% in fiscal 2014 compared to fiscal 2013. Based on current futures prices, we expect lower feed costs in fiscal 2014 compared to fiscal 2013 of approximately $500 million. Many of our sales contracts are formula based or shorter-term in nature, which allows us to adjust pricing when input costs fluctuate. However, there may be a lag time for price changes to take effect. For fiscal 2014, we believe our Chicken segment will be in or above its normalized range of 5.0%-7.0%.
|
•
|
Beef
– We expect to see a reduction of industry fed cattle supplies of 2-3% in fiscal 2014 as compared to fiscal 2013. Although we generally expect adequate supplies in regions we operate our plants, there may be periods of imbalance of fed cattle supply and demand. For fiscal 2014, we believe our Beef segment's profitability will be similar to fiscal 2013, but could be below its normalized range of 2.5%-4.5%.
|
•
|
Pork
– We expect industry hog supplies to be flat and exports to improve compared to fiscal 2013. For fiscal 2014, we believe our Pork segment will be in its normalized range of 6.0%-8.0%.
|
•
|
Prepared Foods
– We expect operational improvements and pricing to offset increased raw material costs. Because many of our sales contracts are formula based or shorter-term in nature, we are typically able to offset rising input costs through increased pricing. For fiscal 2014, we believe our Prepared Foods segment could be slightly below its normalized range of 4.0%-6.0% as we continue to invest in our growth platforms.
|
•
|
Sales
– We expect fiscal 2013 sales to approximate $34.5 billion mostly resulting from price increases related to decreases in domestic availability of certain protein and increased raw material costs. We expect fiscal 2014 sales to approximate $36 billion as we continue to execute our strategy of accelerating growth in domestic value-added chicken sales, prepared food sales and international chicken production.
|
•
|
Capital Expenditures
– We expect fiscal 2013 capital expenditures will approximate $550-$600 million. We expect fiscal 2014 capital expenditures to approximate $650-$700 million.
|
•
|
Net Interest Expense
– We expect net interest expense will approximate $140 million and $100 million for fiscal 2013 and 2014, respectively.
|
•
|
Debt and Liquidity
– Our next significant debt maturity is scheduled for October 2013, which we currently plan to use cash on hand and/or cash flows from operations for payment. We may also use additional available cash to repurchase notes when available at attractive rates. Total liquidity at
June 29, 2013
, was
$2 billion
, well above our goal to maintain liquidity in excess of $1.2 billion.
|
•
|
Share Repurchases
– We expect to continue repurchasing shares under our share repurchase program. As of
June 29, 2013
,
24 million
shares remain authorized for repurchases. The timing and extent to which we repurchase shares will depend upon, among other things, our working capital needs, market conditions, liquidity targets, our debt obligations and regulatory requirements.
|
in millions
|
Nine Months Ended
|
||||||
|
June 29, 2013
|
|
June 30, 2012
|
||||
Net income
|
$
|
519
|
|
|
$
|
395
|
|
Non-cash items in net income:
|
|
|
|
||||
Depreciation and amortization
|
387
|
|
|
369
|
|
||
Deferred income taxes
|
(21
|
)
|
|
75
|
|
||
Loss on early extinguishment of debt
|
—
|
|
|
167
|
|
||
Other, net
|
80
|
|
|
(1
|
)
|
||
Changes in working capital
|
(193
|
)
|
|
(286
|
)
|
||
Net cash provided by operating activities
|
$
|
772
|
|
|
$
|
719
|
|
•
|
Cash flows associated with Loss on early extinguishment of debt includes the amount paid exceeding the par value of debt, unamortized discount and unamortized debt issuance costs related to the completion of our tender offer to purchase any and all of the outstanding 2014 Notes.
|
•
|
Cash flows associated with changes in working capital for the
nine
months ended:
|
•
|
June 29, 2013
– Decreased primarily due to higher inventory and accounts receivable balances and lower accounts payable. The increased inventory and accounts receivable balances are largely due to increased raw material costs and timing of sales.
|
•
|
June 30, 2012
– Decreased primarily due to a higher inventory balance and lower accounts payable, accrued salaries, wages and benefits and interest payable. The increased inventory balance was largely due to increased raw material costs. The decreased interest payable balance was primarily due to the payment of accrued interest related to the 2014 Notes upon extinguishment.
|
in millions
|
Nine Months Ended
|
||||||
|
June 29, 2013
|
|
June 30, 2012
|
||||
Additions to property, plant and equipment
|
$
|
(425
|
)
|
|
$
|
(530
|
)
|
(Purchases of)/Proceeds from marketable securities, net
|
(101
|
)
|
|
(9
|
)
|
||
Acquisitions, net of cash acquired
|
(106
|
)
|
|
—
|
|
||
Other, net
|
36
|
|
|
19
|
|
||
Net cash used for investing activities
|
$
|
(596
|
)
|
|
$
|
(520
|
)
|
•
|
Additions to property, plant and equipment included acquiring new equipment, upgrading our facilities to maintain competitive standing and positioning us for future opportunities.
|
•
|
Capital spending for fiscal
2013
is expected to approximate $550-$600 million, and includes spending on our operations for production and labor efficiencies, yield improvements and sales channel flexibility, as well as expansion of our foreign operations.
|
•
|
Purchases of marketable securities in the nine months of fiscal 2013 included $80 million related to the purchase of short-term investments and $18 million related to the funding of deferred compensation plans.
|
•
|
Acquisitions - During the nine months of fiscal 2013, we acquired
two
value-added food businesses as part of our strategic expansion initiative. The aggregate purchase price of the acquisitions was
$106 million
, which included
$50 million
for property, plant and equipment,
$41 million
allocated to Intangible Assets and
$12 million
allocated to Goodwill.
|
in millions
|
Nine Months Ended
|
||||||
|
June 29, 2013
|
|
June 30, 2012
|
||||
Payments on debt
|
$
|
(69
|
)
|
|
$
|
(919
|
)
|
Net proceeds from borrowings
|
48
|
|
|
1,082
|
|
||
Purchases of Tyson Class A common stock
|
(298
|
)
|
|
(209
|
)
|
||
Dividends
|
(87
|
)
|
|
(44
|
)
|
||
Stock options exercised
|
93
|
|
|
32
|
|
||
Other, net
|
13
|
|
|
(26
|
)
|
||
Net cash used for financing activities
|
$
|
(300
|
)
|
|
$
|
(84
|
)
|
•
|
During the nine months of fiscal 2012, we received net proceeds of $995 million from the issuance of the 4.50% Senior Notes due 2022. We used the net proceeds towards the extinguishment of the 2014 Notes, including the payments of accrued interest and related premiums, and general corporate expenses.
|
•
|
During the
nine
months of fiscal 2013, we received proceeds of $40 million and paid $66 million related to borrowings at our foreign operations. Total debt related to our foreign operations was $66 million at
June 29, 2013
($42 million current, $24 million long-term).
|
•
|
Purchases of Tyson Class A common stock included:
|
•
|
$250 million
and
$180 million
for shares repurchased pursuant to our share repurchase program during the
nine
months ended
June 29, 2013
, and
June 30, 2012
, respectively; and
|
•
|
$48 million
and
$29 million
for shares repurchased to fund certain obligations under our equity compensation plans during the
nine
months ended
June 29, 2013
, and
June 30, 2012
, respectively.
|
•
|
Dividends during the
nine
months of fiscal 2013 included a 25% increase to our quarterly dividend rate. Additionally, we declared and paid special dividends per share of $0.10 and $0.09 to holders of Class A stock and Class B stock, respectively, during the nine months of fiscal 2013.
|
in millions
|
|
|
|
|
|
|
|
|
|
||||||||
|
Commitments
Expiration Date
|
|
Facility
Amount
|
|
|
Outstanding
Letters of Credit
(no draw downs)
|
|
|
Amount
Borrowed
|
|
|
Amount
Available
|
|
||||
Cash and cash equivalents
|
|
|
|
|
|
|
|
|
$
|
943
|
|
||||||
Short-term investments
|
|
|
|
|
|
|
|
|
$
|
81
|
|
||||||
Revolving credit facility
|
August 2017
|
|
$
|
1,000
|
|
|
$
|
56
|
|
|
$
|
—
|
|
|
$
|
944
|
|
Total liquidity
|
|
|
|
|
|
|
|
|
$
|
1,968
|
|
•
|
Short-term investments include marketable debt securities with maturities of less than 12 months, primarily certificates of deposit and commercial paper, classified as available-for-sale.
|
•
|
The revolving credit facility supports our short-term funding needs and letters of credit. The letters of credit issued under this facility are primarily in support of workers’ compensation insurance programs and derivative activities.
|
•
|
Our 3.25% Convertible Senior Notes due 2013 (2013 Notes) may currently be converted to Class A stock early during any fiscal quarter in the event certain conditions are met. In this event, any note holders electing early conversion would be paid the conversion value up to the principal value in cash, which totaled
$458 million
at
June 29, 2013
. Any conversion premium would be paid in shares of Class A stock. The conditions for early conversion were met in our
third
quarter of fiscal
2013
, and thus, holders maintain the option to convert the 2013 Notes during our fourth quarter of fiscal
2013
. On and after July 15, 2013, until the close of business on the second scheduled trading day immediately preceding the maturity date, which is October 15, 2013, holders may convert their notes at any time. Should the holders exercise the early conversion option on or after July 15, 2013, we would be required to make such delivery of cash and Class A stock, if any, at the October 15, 2013 maturity date. As of August 2, 2013, there were no significant early conversions. We presently plan to use cash on hand and/or cash flows from operations for payment on the 2013 Notes on October 15, 2013.
|
•
|
At
June 29, 2013
, approximately
32%
of our cash was held in the international accounts of our foreign subsidiaries. Generally, we do not rely on the foreign cash as a source of funds to support our ongoing domestic liquidity needs, but rather we manage our worldwide cash requirements by reviewing available funds among our foreign subsidiaries and the cost effectiveness with which those funds can be accessed. The repatriation of cash balances from certain of our subsidiaries could have adverse tax consequences or be subject to regulatory capital requirements; however, those balances are generally available without legal restrictions to fund ordinary business operations. Our U.S. income taxes, net of applicable foreign tax credits, have not been provided on undistributed earnings of foreign subsidiaries. Our intention is to reinvest these earnings permanently or to repatriate the earnings only when it is tax effective to do so.
|
•
|
Our current ratio was
1.88
to 1 and
1.91
to 1 at
June 29, 2013
, and
September 29, 2012
, respectively.
|
Ratings Level (S&P/Moody's/Fitch)
|
Facility Fee
Rate
|
|
Undrawn Letter of
Credit Fee and
Borrowing Spread
|
|
BBB+/Baa1/BBB+ or above
|
0.150
|
%
|
1.125
|
%
|
BBB/Baa2/BBB (current level)
|
0.175
|
%
|
1.375
|
%
|
BBB-/Baa3/BBB-
|
0.225
|
%
|
1.625
|
%
|
BB+/Ba1/BB+
|
0.275
|
%
|
1.875
|
%
|
BB/Ba2/BB or lower or unrated
|
0.325
|
%
|
2.125
|
%
|
Item 3.
|
Quantitative and Qualitative Disclosures About Market Risk
|
Effect of 10% change in fair value
|
|
|
in millions
|
|
|||
|
June 29, 2013
|
|
September 29, 2012
|
||||
Livestock:
|
|
|
|
||||
Cattle
|
$
|
14
|
|
|
$
|
42
|
|
Hogs
|
21
|
|
|
37
|
|
||
Grain
|
14
|
|
|
30
|
|
Item 4.
|
Controls and Procedures
|
Item 1.
|
Legal Proceedings
|
Item 1A.
|
Risk Factors
|
Item 2.
|
Unregistered Sales of Equity Securities and Use of Proceeds
|
Period
|
Total
Number of
Shares
Purchased
|
|
|
Average
Price Paid
per Share
|
|
Total Number of Shares
Purchased as Part of
Publicly Announced
Plans or Programs
|
|
|
Maximum Number of
Shares that May Yet Be
Purchased Under the Plans
or Programs
(1)
|
|
|
March 31, 2013 to April 27, 2013
|
164,208
|
|
|
$
|
24.30
|
|
—
|
|
|
28,000,134
|
|
April 28, 2013 to June 1, 2013
|
2,065,995
|
|
|
24.91
|
|
1,879,800
|
|
|
26,120,334
|
|
|
June 2, 2013 to June 29, 2013
|
2,175,734
|
|
|
25.33
|
|
2,099,332
|
|
|
24,021,002
|
|
|
Total
|
4,405,937
|
|
(2)
|
$
|
25.09
|
|
3,979,132
|
|
(3)
|
24,021,002
|
|
(1)
|
On February 7, 2003, we announced our Board of Directors approved a program to repurchase up to 25 million shares of Class A common stock from time to time in open market or privately negotiated transactions. The program has no fixed or scheduled termination date. On May 3, 2012, our Board of Directors approved an increase of 35 million shares authorized for repurchase under this program.
|
(2)
|
We purchased 426,805 shares during the period that were not made pursuant to our previously announced stock repurchase program, but were purchased to fund certain Company obligations under our equity compensation plans. These transactions included 385,935 shares purchased in open market transactions and 40,870 shares withheld to cover required tax withholdings on the vesting of restricted stock.
|
(3)
|
These shares were purchased during the period pursuant to our previously announced stock repurchase program.
|
Item 3.
|
Defaults Upon Senior Securities
|
Item 4.
|
Mine Safety Disclosures
|
Item 5.
|
Other Information
|
Item 6.
|
Exhibits
|
Exhibit
No.
|
|
Exhibit Description
|
|
|
|
|
|
3.2
|
|
Fifth Amended and Restated Bylaws of the Company
|
|
|
|
|
|
12.1
|
|
Ratio of Earnings to Fixed Charges
|
|
|
|
|
|
31.1
|
|
Certification of Chief Executive Officer pursuant to SEC Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
|
|
31.2
|
|
Certification of Chief Financial Officer pursuant to SEC Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
|
|
32.1
|
|
Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
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32.2
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Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
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101
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The following financial information from our Quarterly Report on Form 10-Q for the quarter ended June 29, 2013, formatted in XBRL (eXtensible Business Reporting Language): (i) Condensed Consolidated Statements of Income, (ii) Condensed Consolidated Statements of Comprehensive Income, (iii) Condensed Consolidated Balance Sheets, (iv) Condensed Consolidated Statements of Cash Flows, and (v) the Notes to Condensed Consolidated Financial Statements.
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TYSON FOODS, INC.
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Date: August 5, 2013
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/s/ Dennis Leatherby
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Dennis Leatherby
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Executive Vice President and Chief Financial Officer
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Date: August 5, 2013
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/s/ Curt T. Calaway
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Curt T. Calaway
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Senior Vice President, Controller and Chief Accounting Officer
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/s/ John Tyson
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Chairman of the Board of Directors
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Attest:
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/s/ R. Read Hudson
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Secretary
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(dollars in millions)
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Nine
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Months
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Ending
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Fiscal Years
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||||||||||||||||||||
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June 29, 2013
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2012
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2011
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2010
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2009
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2008
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Earnings:
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Income (loss) from continuing operations before income taxes and equity method investment earnings
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$
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873
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$
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949
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$
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1,066
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$
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1,224
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$
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(541
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)
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$
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148
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Add: Fixed charges
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164
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264
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305
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360
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388
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272
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Add: Amortization of capitalized interest
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4
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5
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4
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3
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4
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4
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Less: Capitalized interest
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(6
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)
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(10
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)
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(9
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)
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(11
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)
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(3
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)
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(3
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)
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Total adjusted earnings
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1,035
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1,208
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1,366
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1,576
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(152
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)
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421
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Fixed Charges:
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Interest
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88
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150
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191
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240
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289
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212
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Capitalized interest
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6
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10
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9
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11
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3
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3
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Amortization of debt discount expense
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21
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39
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44
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46
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38
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3
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Rentals at computed interest factor
(1)
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49
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65
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61
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63
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58
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54
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Total fixed charges
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$
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164
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$
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264
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$
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305
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$
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360
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$
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388
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$
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272
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Ratio of Earnings to Fixed Charges
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6.31
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4.58
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4.48
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4.38
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1.55
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Insufficient Coverage
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540
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(1)
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Amounts represent those portions of rent expense (one-third) that are reasonable approximations of interest costs.
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/s/ Donnie Smith
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Donnie Smith
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President and Chief Executive Officer
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/s/ Dennis Leatherby
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Dennis Leatherby
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Executive Vice President and Chief Financial Officer
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/s/ Donnie Smith
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Donnie Smith
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President and Chief Executive Officer
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August 5, 2013
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/s/ Dennis Leatherby
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Dennis Leatherby
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Executive Vice President and Chief Financial Officer
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August 5, 2013
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