When Tom Hayes, Tyson Foods' new CEO, addresses consumer analysts in Florida today, he'll tell them the food giant is gearing up for strong growth and that it plans to continue expanding its many brands.
In a Monday interview, Hayes said today's consumers want healthful and convenient food alternatives, but to deliver those qualities at affordable prices, it must be done at scale. He said Tyson will invest in innovation and plans to introduce new products that will feature antibiotic-free poultry, a program the company calls No Antibiotics Ever.
In 2015, Tyson said it would phase out the use of all human antibiotics in its chickens by the end of 2017. Fast-food chains, consumers and the U.S. Food and Drug Administration have been putting pressure on drugmakers and companies that use antibiotics in meat production over concerns that overuse of antibiotics helps create bacteria and pathogens that are drug resistant.
Hayes acknowledged that the meat industry has been the target of criticism on several fronts in recent years, and he said Tyson's response is a holistic approach to that takes into account both corporate responsibilities and producing food in a sustainable way.
"The long-term view that we are taking is to be a positive influence," he said. "It's doing the right things."
Hayes added the company will work toward improving animal health, including implementing lessons learned at a concept farm in Northwest Arkansas that create better conditions for the birds raised, the environment and food safety.
Tyson also will roll out its new corporate logo at the conference. Hayes said its design reaches back to the company's history but also points to where the company is going as an integrated food provider with an entire stable of brands.
"We are more than a poultry company," Hayes said.
Tyson acquired Hillshire and its many well-known brands, such as Jimmy Dean and Ballpark, in 2014 for $7.7 billion. A former Hillshire Foods executive, Hayes took over Tyson's top job at the first of the year. Hayes replaced Donnie Smith, who saw company shares leap in value during his time as CEO.
Martin Thoma, a principal at Little Rock-based Thoma Thoma, a brand leadership firm, and author of Branding Like the Big Boys, said re-branding or evolving a brand can be difficult for companies with well-established identities.
"We, as consumers, have long memories," he said. "But that's also the power of brands. We form our opinions and we stick with them."
He said Tyson faces a long slog integrating its varied brands but, if successful, the effort will result in more sales, improved brand reputation and consumer loyalty. He said a good brand strategy begins with a company deciding what it is and what it wants to be known for and then making sure every move the company does going forward reflects that strategy.
He said the unveiling of the logo in a room full of consumer analysts is part of that new image campaign. While he said a new logo does not equate to a new brand, it does serve as a stake in the ground, marking the company's intention to change its narrative.
"He's beginning to tell a new story," Thoma said.
Last week, Tyson Foods trotted out a new senior leadership team of 10, including three former Hillshire Brands employees, all reporting directly to Hayes. At the time, Tyson said the new leadership team's varied experience will benefit Tyson in the future and is structured to allow for rapid decision making. Three long-time Tyson executives are leaving their posts at the Springdale-based company as a result of the shake-up.
Earlier this month, Tyson Foods reported its profits were up 29 percent in the first quarter, breaking company records and handily beating analysts' estimates. The company raised its earnings per share guidance for the coming year from $4.90 to $5.05, or about 12 percent more than 2016.
During a call with analysts concerning Tyson's earnings, Hayes confirmed that the company was being investigated by the Securities and Exchange Commission, likely in connection with a series of price-fixing lawsuits filed against Tyson and other large poultry companies. At the time, Hayes did not comment about the details of the subpoena but said the food company is cooperating fully with the commission's investigation. Tyson has denied any wrongdoing.
The Consumer Analyst Group of New York, commonly called CAGNY, is holding its conference in the Boca Raton Resort and Club this year. Tyson is webcasting its presentation.
Hayes and Sally Grimes, Tyson's chief global growth officer and the president of the company's international division, will speak at 8:15 a.m. today. The webcast is available at the company's investor relation website and through its investor-relations application.
Metro on 02/21/2017