Tyson Foods Inc, the biggest U.S. meat processor, reported a higher-than-expected quarterly profit, helped by lower feed and livestock costs, and lifted its adjusted earnings forecast for the year.
Shares of the maker of Jimmy Dean sausages and Ball Park jerky were up 5 percent in light premarket trading on Monday.
Tyson said it May it expected good cattle supply for its beef business, its largest, through the summer and into 2017.
Livestock costs are falling in the United States as farmers build up their cattle herds, which hit a 63-year low in 2014 because of a drought.
Feed costs have also been falling due to a global glut of corn and soybeans that has kept grain prices depressed for three straight years.
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The net income attributable to Tyson rose to $484 million, or $1.25 per share, in the third quarter ended July 2, from $343 million, or 83 cents per share, a year earlier.
Excluding items, the company earned $1.21 per share. Sales fell 6.6 percent to $9.40 billion. Cost of sales fell 10 percent to $8.18 billion in the quarter.
Analysts on average had expected earnings of $1.06 per share and revenue of $9.33 billion, according to Thomson Reuters I/B/E/S.
Tyson said it now expects full-year adjusted earnings of $4.40-$4.50 per share, up from its previous forecast of $4.20-4.30.
