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Tyson Foods CEO steps down for personal reasons
[CHICAGO] Tyson Foods Inc Chief Executive Officer Tom Hayes will step down at the end of the month for personal reasons after less than two years in the role, the top US meat processor said on Monday.
Noel White, a company veteran who has been running Tyson's chicken, beef and pork businesses, will replace Hayes.
The change, which surprised Wall Street analysts, comes as Tyson is grappling with a drop in US demand for chicken and declining prices for pork due to tensions between the United States and trading partners.
Tyson declined to give details on Hayes' reasons for leaving or make him available for an interview.
Hayes, 53, had "no issues of personal conduct or integrity," company spokesman Gary Mickelson said. Tyson's board considered multiple candidates to become CEO, Mickelson said.
In a statement, Hayes said it was a difficult decision to leave. "After careful consideration and discussions with my family and the board, I know it is the right thing to do," he said.
The maker of Ball Park hotdogs and Jimmy Dean sausages cut its full-year profit forecast in July, citing uncertainty in trade policies and tariffs from importers.
Hayes led a shift of Tyson's strategy to focus on sales of packaged and prepared foods, which have higher profit margins than raw meat. However, management has been under scrutiny since it cut the full-year outlook, said Jeremy Scott, analyst for Mizuho Securities.
"While prepared foods margins have been solid in the last three quarters, beating all expectations, investor focus has shifted to volatile commodity markets and difficult conditions in chicken," Scott said.
Hayes' resignation is the latest high-level departure in the food sector, where traditional titans have lost ground to smaller brands while facing pressure from investors to become more efficient.
Chairman John Tyson thanked Hayes and said White had deep knowledge of the company.
White, 60, became president of Tyson's fresh meats and international unit in 2017, after serving as president of poultry, according to regulatory filings. He started work in 1983 with IBP, which Tyson acquired.
Tyson reaffirmed its adjusted profit forecast for fiscal year 2018, indicating Hayes' departure "is not a sign of potential operational issues," said Akshay Jagdale, equity analyst for Jefferies.
"Over his relatively short tenure, Tom made significant organizational changes," Jagdale said. "All of these efforts set a good foundation but seem to have been overshadowed by a turn in the chicken and pork commodity cycles."
Tyson shares slipped 0.5 percent to close at US$63.06.