By Bob Burgdorfer
CHICAGO (Reuters) - Tyson Foods Inc's quarterly profit surged 86 percent and it gave a better-than-expected 2011 forecast as prices for pork and beef jump, sending its shares up 5.3 percent.
All four of the company's segments were profitable, with pork income nearly triple a year ago due to higher prices and strong exports.
"Pork was unreal. They are generating unheard of margins in pork. Beef was strong, but pork is what really drove it," said Heather Jones, agribusiness analyst with BB&T Capital Markets.
"I think exports is what are driving this huge profitability in pork and in beef."
Tyson said fiscal 2011 results may be similar 2010's $2.19 per share. Analysts, on average, expected $1.81, according to Thompson Reuters I/B/E/S/.
First-quarter earnings at the world largest meat company were $298 million, or 78 cents per share, compared with $160 million, or 42 cents, a year earlier. The results include a $11 million gain, or 3 cents a share, for an investment sale.
Wall Street analysts, on average, had expected 62 cents, according to Thomson Reuters I/B/E/S.
Revenue for the quarter was $7.61 billion, while Wall Street expected $7.15 billion.
"Our performance is due to on-going, sustainable operational improvements across all four segments," said Chief Executive Donnie Smith, "Our view of 2011 is basically the same as it as a few months ago. Beef and pork are off to a great start, and their combined results in 2011 should be similar to 2010.
The segments include beef, pork, chicken and prepared foods.
The operational improvements include streamlining production, reducing product movement between plants, and more flexibility in producing different products.
The company expects higher feed costs to narrow operating margin for its chickens. Tyson buys the cattle and hogs for it beef and pork plants but raises it chickens.
Shares were up 5.3 percent at $18.49 in premarket trading.
(Reporting by Bob Burgdorfer, Chicago; NR Sethuraman in Bangalore; Editing by Gopakumar Warrier, Dave Zimmerman)
