Tyson Foods 2006 Annual Report Download - page 54

NOTE 16 EARNINGS (LOSS) PER SHARE
The weighted average common shares used in the computation of
basic and diluted earnings (loss) per share are as follows:
in millions, except per share data 2006 2005 2004
Numerator:
Income (loss) before cumulative effect
of change in accounting principle $ (191) $ 372 $ 403
Cumulative effect of change in
accounting principle, net of tax (5) – –
Net income (loss) (196) 372 403
Less Dividends:
Class A ($0.16/share) 41 40 40
Class B ($0.144/share) 14 15 15
Undistributed earnings (losses) (251) 317 348
Class A undistributed earnings (losses) (186) 230 253
Class B undistributed earnings (losses) (65) 87 95
Total undistributed earnings (losses) $ (251) $ 317 $ 348
Denominator:
Denominator for basic earnings per share:
Class A weighted average shares 249 243 243
Class B weighted average shares, and
shares under if-converted method for
diluted earnings per share 96 102 102
Effect of dilutive securities:
Stock options and restricted stock –12 12
Denominator for diluted earnings per
share – adjusted weighted average
shares and assumed conversions 345 357 357
Earnings before cumulative effect of
change in accounting principle:
Class A Basic $(0.56) $1.11 $1.20
Class B Basic $(0.52) $1.00 $1.08
Diluted $(0.56) $1.04 $1.13
Cumulative effect of change in
accounting principle, net of tax:
Class A Basic $(0.02) $ – $ –
Class B Basic $(0.01) $ – $ –
Diluted $(0.02) $ – $ –
Net income (loss):
Class A Basic $(0.58) $1.11 $1.20
Class B Basic $(0.53) $1.00 $1.08
Diluted $(0.58) $1.04 $1.13
Approximately 28 million in fiscal 2006 and two million in each
of fiscal 2005 and 2004 of the Company’s option shares were
antidilutive and were not included in the dilutive earnings
per share calculation.
NOTE 17 SEGMENT REPORTING
The Company operates in five business segments: Chicken, Beef,
Pork, Prepared Foods and Other. The Company measures segment
profit as operating income.
• Chicken segment is involved primarily in processing live
chickens into fresh, frozen and value-added chicken products.
The Chicken segment markets its products domestically to food
retailers, foodservice distributors, restaurant operators and non-
commercial foodservice establishments such as schools, hotel
chains, healthcare facilities, the military and other food processors,
as well as to international markets throughout the world. The
Chicken segment also includes sales from allied products and
the Company’s chicken breeding stock subsidiary.
• Beef segment is involved primarily in processing live fed cattle
and fabricating dressed beef carcasses into primal and sub-primal
meat cuts and case-ready products. It also involves deriving value
from allied products such as hides and variety meats for sale to
further processors and others. The Beef segment markets its products
domestically to food retailers, foodservice distributors, restaurant
operators and noncommercial foodservice establishments such as
schools, hotel chains, healthcare facilities, the military and other
food processors, as well as to international markets throughout the
world. Allied products are also marketed to manufacturers of phar-
maceuticals and technical products.
• Pork segment is involved primarily in processing live market hogs
and fabricating pork carcasses into primal and sub-primal cuts and
case-ready products. This segment also represents the Company’s
live swine group and related allied product processing activities.
The Pork segment markets its products domestically to food
retailers, foodservice distributors, restaurant operators and non-
commercial foodservice establishments such as schools, hotel
chains, healthcare facilities, the military and other food processors,
as well as to international markets throughout the world. It also
sells allied products to pharmaceutical and technical products
manufacturers, as well as live swine to pork processors.
52 Ty s o n F o o d s , I n c . 2 0 0 6 A n n u a l R e p o r t
Notes to Consolidated Financial Statements continued