Tyson Foods

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Tyson Foods, Inc.
Type Public
Traded as NYSETSN
S&P 500 Component
Industry Food processing
Founded 1935
Headquarters Springdale, Arkansas, USA
Key people Donnie Smith CEO
Products Meat
Revenue
  • Increase US$ 34,374.0 million (2013) [1]
  • Increase US$ 33,055.0 million (2012) [1]
Operating income
  • Increase US$ 1,375.0 million (2013) [1]
  • Decrease US$ 1,286.0 million (2012) [1]
Net income
  • Increase US$ 778.0 million (2013) [1]
  • Decrease US$ 583.0 million (2012) [1]
Total assets
  • Increase US$ 12,177.0 million (2013) [2]
  • Increase US$ 11,896.0 million (2012) [1]
Total equity
  • Increase US$ 6,233.0 million (2013) [2]
  • Increase US$ 6,042.0 million (2012) [1]
Employees 115,000[3]
Website tyson.com

Tyson Foods, Inc. (NYSETSN) is an American multinational corporation based in Springdale, Arkansas, that operates in the food industry. The company is the world's second largest processor and marketer of chicken, beef, and pork only behind Brazilian JBS S.A., and annually exports the largest percentage of beef out of the United States. With 2011 sales of US$32 billion, Tyson Foods is the second-largest food production company in the Fortune 500, the largest meat producer in the world, and according to Forbes one of the 100 largest companies in the United States.

Profile[edit]

The company was established by John W. Tyson in 1935, and as of 2014 employs 115,000 people, who work at more than 300 facilities, 90 of which are in the US and in countries throughout the world.[4] As of 2014, Tyson had about 97,000 employees in 27 states; locations are concentrated in the Midwest, with 16 locations in Arkansas, 11 in Texas, 9 in Iowa, and the remainder of the mostly eastern US with less than 3-4 locations.[4] Tyson also works with 6,729 independent contract chicken growers.

It is one of the largest U.S. marketers of value-added chicken, beef and pork to retail grocers, broad line foodservice distributors and national fast food and full service restaurant chains; fresh beef and pork; frozen and fully cooked chicken, beef and pork products; case-ready beef and pork; supermarket deli chicken products; meat toppings for the pizza industry and retail frozen pizza; club store chicken, beef and pork; ground beef and flour tortillas. It supplies all Yum! Brands chains that use chicken, including KFC and Taco Bell, as well as McDonald's, Burger King, Wendy's, Wal-Mart, Kroger, IGA, Beef O'Brady's, small restaurant businesses, and prisons.

The company makes a wide variety of animal-based and prepared products at its 123 food processing plants. It produces many different products, including Buffalo wings, boneless Buffalo wings, chicken nuggets and tenders. Every week, its 54 chicken plants, 13 beef plants, and six pork plants slaughter and package 42.5 million chickens, 170,938 cattle, and 347,891 pigs. Their largest meat packing facility is their beef production plant in Dakota City, Nebraska. Other plants include feed mills, hatcheries, and tanneries.

Acquisitions[edit]

In 2001, Tyson Foods acquired IBP, Inc., the largest beef packer and number two pork processor in the U.S., for US$3.2 billion in cash and stock. Tyson has also acquired such companies as Hudson Foods Company, Garrett poultry, Washington Creamery, Franz Foods, Prospect Farms, Krispy Kitchens, Ocoma Foods, Cassady Broiler, Vantress Pedigree, Wilson Foods, Honeybear Foods, Mexican Original, Valmac Industries, Heritage Valley, Lane Processing, Cobb-Vantress, Holly Farms, Wright Brand Foods, Inc. and Don Julio Foods. It also acquired along with its purchase of IBP, the naming rights to an event center in Sioux City, Iowa. On 29 May 2014, the company announced a $6.13 billion cash offer to acquire all the shares in Hillshire Brands, two days after a $6.4 billion cash and shares bid for Hillshire by Pilgrim's Corp.[5] In June, Tyson won the bidding war against Pilgrim's Pride, agreeing to buy the maker of Jimmy Dean sausage and Ball Park hot dogs for $8.5 billion.[6]

Tyson Renewable Energy[edit]

Tyson's processing plants are left with a vast supply of animal fats. In late 2006, the company created a business unit called Tyson Renewable Energy to examine ways to commercialize use of this leftover material by converting it into biofuels.[7] The unit is also examining the potential use of poultry litter to generate energy and other products.[8] On April 16, 2007, Tyson announced a joint venture with ConocoPhillips to produce roughly 175 million gallons of biodiesel a year— enough to run Tyson Foods' truck fleet for 3.5 years.[9] On July 28th, 2014, the company said it would sell its Mexican and Brazilian poultry businesses to JBS S.A. for $575 million and use the proceeds to pay down debt from its pending $7.7 billion purchase of Hillshire Brands Co.[4]

Corporate Charity[edit]

Since 2000, Tyson Foods has given more than 78 million pounds of its products to hunger and disaster relief in the United States - altogether enough protein to have served one meal to every American citizen.[10] Tyson has donated millions of dollars in cash to help non-profit organizations across the country. For these efforts, Forbes named Tyson Foods the second most proportionally generous company for its donations in 2007 totaling 1.6 percent ($8 million) of its annual operating income.[11] Tyson initiated the KNOW Hunger campaign in early 2011 to raise awareness of hunger in the United States.[10] After the Joplin tornado of 2011, Tyson sent 77,000 pounds of food to the city.[12] It also sent 100,000 pounds of food to the communities along the Gulf of Mexico after the oil spill.[13]

Religious activities[edit]

Current chairman John Tyson is a practicing Interfaith Christian. In addition to placing 128 part-time chaplains (including both Protestant and Catholic Christians and Muslim Imams) in 78 Tyson plants,[14] in 2006, the company invited their customers to download a prayer book, containing prayers from many faiths, including Christianity, Judaism, Islam, and American Indian spirituality, from the company's website to read during mealtime.[15][16]

Corporate governance[edit]

Board of Directors[edit]

CEOs[edit]

Richard L. Bond had been CEO of the company until January 7, 2009 when he stepped down and his position filled by temporary replacement Leland Tollett. The current CEO is Donnie Smith.[18]

Controversies[edit]

World headquarters of Tyson Foods at 2200 Don Tyson Pkwy, Springdale, Arkansas

Environmental record[edit]

During the past decade, Tyson has been involved in several lawsuits related to air and water pollution. In June 2003, the company admitted to illegally dumping untreated wastewater from its poultry processing plant near Sedalia, Missouri, pleading guilty to 20 felony violations of the federal Clean Water Act. As part of the plea agreement, the company agreed to pay $7.5 million in fines, hire an outside consultant to perform an environmental audit, and institute an "enhanced environmental management system" at the Sedalia plant. At the same time, Tyson also settled a case filed by the Missouri attorney general's office related to the same illegal dumping.

The United States Environmental Protection Agency began the investigation into the discharges in 1997, and federal officials served two criminal search warrants at the plant in 1999. According to EPA and U.S. Department of Justice officials, Tyson continued to illegally dump wastewater after the search warrants were executed, prompting an EPA senior trial attorney to remark that: "Having done this work for nearly 20 years, I don't recall any case where violations continued after the execution of two search warrants. That's stunning." Under the federal and state plea agreements, Tyson agreed to pay $5.5 million to the federal government, $1 million to the Pettis County School Fund and $1 million to the Missouri Natural Resources Protection Fund to help remedy the damage.[19]

In 2002, three residents of Western Kentucky, together with the Sierra Club, filed a lawsuit concerning the discharge of dangerous quantities of ammonia from Tyson's Western Kentucky factories. Tyson settled the suit in January 2005, agreeing to spend $500,000 to mitigate and monitor the ammonia levels.[20]

In 2004, Tyson was one of six poultry companies to pay a $7.3 million settlement fee to the city of Tulsa, Oklahoma, to settle charges that the use of chicken waste as fertilizer had created phosphorus pollution in Tulsa's main drinking water sources.[21]

Employment of undocumented immigrants[edit]

In 2001, Tyson was charged with conspiracy to smuggle undocumented workers to work on its production lines. Tyson plant managers arranged for delivery of illegal workers with undercover immigration officials. Prosecutors alleged that the conspiracy to import workers dates back to 1994 when plant managers began to find it difficult to fill positions with "cheap legal help". Of the six managers who were indicted, two accepted plea bargain deals, and one committed suicide one month after being charged. In March 2003, a federal jury acquitted Tyson of having knowingly hired illegal immigrants.[22][23]

In May 2006, Tyson suspended operations at nine plants during a nationwide day of immigration demonstrations citing expected lack of workers.[24]

In October 2006, a federal judge granted class-action status to a lawsuit brought by Tyson employees who allege that Tyson's practice of hiring illegal immigrants depresses wages 10–30%. The suit further contends that the company violated federal racketeering laws by conspiring with National Council of La Raza and League of United Latin American Countries not to question the employment applications of anyone with a Hispanic surname.[25][26][27]

Price Manipulation[edit]

In 2004 a federal jury found that Tyson Fresh Meats had used captive supply agreements to artificially lower fed cattle prices in violation of the Packers and Stockyards Act. Damages were found to be $1.28 billion. A U.S. Court of Appeals voided the verdict because it determined Tyson had a legitimate business justification to artificially lower cattle prices.[28]

Use of slaughtering methods[edit]

From December 2004 through February 2005, an undercover investigator for People for the Ethical Treatment of Animals claimed to have worked on the slaughter line of a Tyson Foods chicken processing plant in Heflin, Alabama. Using a hidden camera, he allegedly documented the treatment of the more than 100,000 chickens killed every day in the plant. PETA alleges that workers were instructed to rip the heads off of birds who missed the throat-cutting machines. He claims he saw birds scalded alive in the feather removal tank, and he said that managers said that it was acceptable to scald 40 birds alive per shift. Interestingly the job the investigator was hired to do was to prevent the alleged abuses he videotaped: preventing birds from going into the scald tank alive. The investigator claims plant employees were also seen throwing around dead birds just for fun. PETA has asked Tyson to implement controlled atmosphere killing (CAK). For this reason, PETA is boycotting businesses that use Tyson as a supplier, such as KFC and distribution channels such as Sunset Strips. The video, taken by the investigator of the killings, was posted on YouTube.[29]

In 2006, Tyson completed a study to determine whether CAK, which uses gas to render chickens unconscious before slaughter, could be a more humane practice than conventional electrical stunning. According to Bill Lovette, Tyson's senior group vice president of poultry and prepared foods, the study found no difference between the humaneness of the two methods. The company plans to ask scientists at the University of Arkansas to initiate a similar study to test these initial results. The research will be led by the newly created Chair in Food Animal Wellbeing at the Dale Bumpers College of Agricultural, Food and Life Sciences of the University of Arkansas. Tyson has committed $1.5 million to help establish the Chair, which will be involved in overseeing research and classes focused on the humane management and treatment of food animals.[30]

Undisclosed use of antibiotics[edit]

In 2007, Tyson began labeling and advertising its chicken products as "Raised without Antibiotics." After being advised by the USDA that Tyson’s use of protozoa-killing ionophores in unhatched eggs constituted antibiotic use, Tyson and the USDA compromised on rewording Tyson’s slogan as "raised without antibiotics that impact antibiotic resistance in humans." Tyson competitors Perdue Farms and Sanderson Farms sued claiming that Tyson’s claim violated truth-in-advertising/labeling standards. In May 2008, a federal judge ordered Tyson to stop using the label.

In June 2008, USDA inspectors discovered that Tyson had also been using gentamicin, an antibiotic, in eggs. USDA Undersecretary for Food Safety Richard Raymond claimed that the company hid the use of this antibiotic from federal inspectors claiming that the use of this chemical is standard industry practice. Tyson agreed to voluntarily remove its “raised without antibiotics” label in future packaging and advertising.[31]

See also[edit]

References[edit]

  1. ^ a b c d e f g h "TYSON FOODS INC 2013 Annual Report Form (10-K)" (XBRL). United States Securities and Exchange Commission. November 18, 2013. 
  2. ^ a b "TYSON FOODS INC 2014 Q2 Quarterly Report Form (10-Q)" (XBRL). United States Securities and Exchange Commission. May 5, 2014. 
  3. ^ Tyson2010FactBook
  4. ^ a b c "Tyson Foods Our story". Tyson Foods. Retrieved 16 July 2014. "We have more than 115,000 Team Members in more than 90 U.S. locations, and in operations across the globe." 
  5. ^ "US meat giant Tyson joins acquisition bid for Hillshire Brands". Business Sun. Retrieved 30 May 2014. 
  6. ^ "Tyson Foods wins battle to buy Hillshire Brands". Arkansas State News.Net. Retrieved 10 June 2014. 
  7. ^ "Tyson Foods forms Tyson Renewable Energy". Biodiesel Magazine. January 2007. Retrieved August 5, 2007. 
  8. ^ "Tyson Foods and Renewable Energy to Provide Alternative Use for Chicken Litter in Delmarva" (Press release). July 12, 2001. Retrieved August 5, 2007. 
  9. ^ Souza, Kim (April 16, 2007). "Tyson Foods Turning Fat Into Fuel". The Morning News. Retrieved August 5, 2007. 
  10. ^ a b http://www.tysonhungerrelief.com/our-commitment/
  11. ^ Kirdahy, Matthew (16 Dec 2008). "America's Most Generous Corporations". Corporate Social Responsibility. Forbes.com. 
  12. ^ "Tyson Foods Provides Disaster Relief in Arkansas; Continues in Missouri and Kansas" (Press Release). Tyson. 
  13. ^ The Associated Press (11 Aug 2010). "Neil Young, Tyson Foods team to help Gulf Coast". Finance News. Bloomberg Business Week. 
  14. ^ Hedges, Chris (2006). American Fascists: The Christian Right and the War On America. New York: Free Press. p. 22. 
  15. ^ Thompson, Stephanie (5 Dec 2005). "Fowl pray: Tyson gets religion". Advertising Age. 
  16. ^ Tyson Foods, Inc.: Giving Thanks
  17. ^ a b c d e f g h i Tyson Foods Board of Directors
  18. ^ Ackerman, Ruthie (5 Jan 2009). "Tyson CEO Flies The Coop". Market Scan. Forbes.com. 
  19. ^ "Tyson pleads guilty in pollution case, will pay $7.5 million in fines". Corporate Ethics and Government, June 25, 2003. Retrieved on June 4, 2007.
  20. ^ "Tyson Settles Air Pollution Suit for $500,000". The New York Times, January 28, 2005. Retrieved on June 4, 2007.
  21. ^ Lassek, P.J. (5 Feb 2005). "Judge OKs lawyer fees in water suit". Tulsa World (Oklahoma: World Publishing Co.). Retrieved 4 June 2007. 
  22. ^ Poovey, Bill (February 7, 2003). "Tyson Says Top Bosses Didn't Know". CBS News. Retrieved August 5, 2007. 
  23. ^ Poovey, Bill (March 26, 2003). "Tyson Foods Acquitted Of Illegal Hiring". CBS News. Retrieved August 5, 2007. 
  24. ^ "Tyson to shutter plants over immigration protest". CNN Money. April 28, 2006. Retrieved August 5, 2007. 
  25. ^ Ott, Tanya (January 26, 2007). "Tyson Foods faces suit over illegal workers". NPR. Retrieved August 5, 2007. 
  26. ^ Poovey, Bill (October 13, 2006). "Ruling helps workers claiming Tyson hired illegals to cut wages". Decatur Daily. Retrieved August 5, 2007. 
  27. ^ "Tyson Foods illegal hiring lawsuit set for March 2008 trial". The Wall Street Journal (New York City: MarketWatch Inc.). 29 Jan 2007. Retrieved 21 Aug 2007. 
  28. ^ Pickett v. Tyson Fresh Meats, Inc., 420 F.3d 1272 (11th Cir. 2005).<http://caselaw.findlaw.com/us-11th-circuit/1492709.html>
  29. ^ "Former Tyson foods employee speaks out against abuses"
  30. ^ "Tyson Asks University to Conduct Animal Welfare Research" (Press release). Tyson Foods. 5 Oct 2006. Retrieved August 5, 2007. 
  31. ^ "USDA says Tyson used antibiotics on chicken". MSNBC. June 3, 2008. Retrieved December 17, 2009. 

External links[edit]

Coordinates: 36°09′13.70″N 94°09′15.49″W / 36.1538056°N 94.1543028°W / 36.1538056; -94.1543028