Segment Reporting

6 Months Ended

Apr. 01, 2017

Segment Reporting [Abstract]

Segment Reporting

SEGMENT REPORTING

We operate in four reportable segments: Beef, Pork, Chicken, and Prepared Foods. We measure segment profit as operating income (loss). Other primarily includes our foreign chicken production operations in China and India, third-party merger and integration costs and corporate overhead related to Tyson New Ventures, LLC.

Beef: Beef includes our operations related to processing live fed cattle and fabricating dressed beef carcasses into primal and sub-primal meat cuts and case-ready products. Products are marketed domestically to food retailers, foodservice distributors, restaurant operators, hotel chains and noncommercial foodservice establishments such as schools, healthcare facilities, the military and other food processors, as well as to international export markets. This segment also includes sales from allied products such as hides and variety meats, as well as logistics operations to move products through the supply chain.

Pork: Pork includes our operations related to processing live market hogs and fabricating pork carcasses into primal and sub-primal cuts and case-ready products. Products are marketed domestically to food retailers, foodservice distributors, restaurant operators, hotel chains and noncommercial foodservice establishments such as schools, healthcare facilities, the military and other food processors, as well as to international export markets. This segment also includes our live swine group, related allied product processing activities and logistics operations to move products through the supply chain.

Chicken: Chicken includes our domestic operations related to raising and processing live chickens into, and purchasing raw materials for, fresh, frozen and value-added chicken products, as well as sales from allied products. Products are marketed domestically to food retailers, foodservice distributors, restaurant operators, hotel chains and noncommercial foodservice establishments such as schools, healthcare facilities, the military and other food processors, as well as to international export markets. This segment also includes logistics operations to move products through our domestic supply chain and the global operations of our chicken breeding stock subsidiary.

Prepared Foods: Prepared Foods includes our operations related to manufacturing and marketing frozen and refrigerated food products and logistics operations to move products through the supply chain. This segment includes brands such as Jimmy Dean®, Hillshire Farm®, Ball Park®, Wright®, State Fair®, Van's®, Sara Lee® and Chef Pierre®, as well as artisanal brands Aidells®, Gallo Salame®, and Golden Island®. Products primarily include pepperoni, bacon, breakfast sausage, turkey, lunchmeat, hot dogs, pizza crusts and toppings, flour and corn tortilla products, desserts, appetizers, snacks, prepared meals, ethnic foods, soups, sauces, side dishes, meat dishes, breadsticks and processed meats. Products are marketed domestically to food retailers, foodservice distributors, restaurant operators, hotel chains and noncommercial foodservice establishments such as schools, healthcare facilities, the military and other food processors, as well as to international export markets.

We allocate expenses related to corporate activities to the segments, except for third-party merger and integration costs and corporate overhead related to Tyson New Ventures, LLC, which are included in Other.

Information on segments and a reconciliation to income before income taxes are as follows (in millions):

	Three Months Ended								Six Months Ended
	April 1, 2017				April 2, 2016				April 1, 2017				April 2, 2016
Sales:
Beef	$	3,487			$	3,639			$	7,015			$	7,253
Pork	1,302				1,190				2,554				2,403
Chicken	2,798				2,737				5,504				5,373
Prepared Foods	1,751				1,804				3,646				3,700
Other	82				86				172				185
Intersegment sales	(337		)		(286		)		(626		)		(592		)
Total sales	$	9,083			$	9,170			$	18,265			$	18,322
Operating income (loss):
Beef	$	126			$	46			$	425			$	117
Pork	141				140				388				298
Chicken	233				347				496				705
Prepared Foods	87			(a)	197				277			(a)	404
Other	(16		)	(b)	(26		)	(b)	(33		)	(b)	(44		)	(b)
Total operating income	571				704				1,553				1,480
Total other (income) expense	52				60				122				124
Income before income taxes	$	519			$	644			$	1,431			$	1,356

(a) Includes a $52 million impairment charge related to our San Diego Prepared Foods operation (see Note 9: Other Income and Charges).

(b) Other includes third-party merger and integration costs and corporate overhead of Tyson New Ventures, LLC of $6 million and $13 million for the three months ended April 1, 2017, and April 2, 2016, respectively, and $13 million and $18 million for the six months ended April 1, 2017, and April 2, 2016, respectively.

The Beef segment had sales of $88 million and $78 million in the second quarter of fiscal 2017 and 2016, respectively, and sales of $160 million and $150 million in the six months of fiscal 2017 and 2016, respectively, from transactions with other operating segments of the Company. The Pork segment had sales of $240 million and $204 million in the second quarter of fiscal 2017 and 2016, respectively, and sales of $450 million and $435 million in the six months of fiscal 2017 and 2016, respectively, from transactions with other operating segments of the Company. The Chicken segment had sales of $9 million and $4 million in the second quarter of fiscal 2017 and 2016, respectively, and sales of $16 million and $7 million in the six months of fiscal 2017 and 2016, respectively, from transactions with other operating segments of the Company. The aforementioned sales from intersegment transactions, which were at market prices, were included in the segment sales in the above table.