Tyson Foods 2015 Annual Report Download - page 9
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Please find page 9 of the 2015 Tyson Foods annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.We are subject to risks associated with our international activities, which could negatively affect our sales to customers in foreign countries, as well as our
operations and assets in such countries.
Infiscal2015,wesoldproductstoapproximately130countries.MajorsalesmarketsincludeBrazil,Canada,CentralAmerica,China,theEuropeanUnion,Japan,
Mexico,theMiddleEast,SouthKorea,andTaiwan.Oursalestocustomersinforeigncountriesforfiscal2015totaled$5.2billion,ofwhich$4.1billionrelatedto
exportsalesfromtheUnitedStates.Inaddition,wehadapproximately$191millionoflong-livedassetslocatedinforeigncountries,primarilyBrazil,China,and
India,attheendoffiscal2015.
Asaresult,wearesubjecttovariousrisksanduncertaintiesrelatingtointernationalsalesandoperations,including:
•impositionoftariffs,quotas,tradebarriersandothertradeprotectionmeasuresimposedbyforeigncountriesregardingtheimportationofpoultry,beef,
porkandpreparedfoodsproducts,inadditiontoimportorexportlicensingrequirementsimposedbyvariousforeigncountries;
•closingofbordersbyforeigncountriestotheimportofpoultry,beefandporkproductsduetoanimaldiseaseorotherperceivedhealthorsafetyissues;
•impactofcurrencyexchangeratefluctuationsbetweentheUnitedStatesdollarandforeigncurrencies,particularlytheBrazilianreal,theBritishpound
sterling,theCanadiandollar,theChineserenminbi,theEuropeaneuro,theJapaneseyenandtheMexicanpeso;
•politicalandeconomicconditions;
•difficultiesandcoststocomplywith,andenforcementofremediesunder,awidevarietyofcomplexdomesticandinternationallaws,treatiesand
regulations,including,withoutlimitation,theUnitedStatesForeignCorruptPracticesActandeconomicandtradesanctionsenforcedbytheUnitedStates
DepartmentoftheTreasury’sOfficeofForeignAssetsControl;
•differentregulatorystructuresandunexpectedchangesinregulatoryenvironments;
•taxratesthatmayexceedthoseintheUnitedStatesandearningsthatmaybesubjecttowithholdingrequirementsandincrementaltaxesuponrepatriation;
•potentiallynegativeconsequencesfromchangesintaxlaws;and
•distributioncosts,disruptionsinshippingorreducedavailabilityoffreighttransportation.
Negativeconsequencesrelatingtotheserisksanduncertaintiescouldjeopardizeorlimitourabilitytotransactbusinessinoneormoreofthosemarketswherewe
operateorinotherdevelopingmarketsandcouldadverselyaffectourfinancialresults.
We depend on the availability of, and good relations with, our employees.
Wehaveapproximately113,000employees,approximately36,000ofwhomarecoveredbycollectivebargainingagreementsoraremembersoflaborunions.Our
operationsdependontheavailabilityandrelativecostsoflaborandmaintaininggoodrelationswithemployeesandthelaborunions.Ifwefailtomaintaingood
relationswithouremployeesorwiththelaborunions,wemayexperiencelaborstrikesorworkstoppages,whichcouldadverselyaffectourfinancialresults.
We depend on contract growers and independent producers to supply us with livestock.
Wecontractprimarilywithindependentcontractgrowerstoraisethelivechickensandturkeysprocessedinourpoultryoperations.Amajorityofourcattleand
hogsarepurchasedfromindependentproducerswhoselllivestocktousundermarketingcontractsorontheopenmarket.Ifwedonotattractandmaintain
contractswithgrowersormaintainmarketingandpurchasingrelationshipswithindependentproducers,ourproductionoperationscouldbenegativelyaffected.
If our products become contaminated, we may be subject to product liability claims and product recalls.
Ourproductsmaybesubjecttocontaminationbydisease-producingorganismsorpathogens,suchasListeriamonocytogenes,SalmonellaandE.coli.These
organismsandpathogensarefoundgenerallyintheenvironmentandthereisariskthatoneormore,asaresultoffoodprocessing,couldbepresentinour
products.Theseorganismsandpathogensalsocanbeintroducedtoourproductsasaresultofimproperhandlingatthefurther-processing,foodserviceor
consumerlevel.Theserisksmaybecontrolled,butmaynotbeeliminated,byadherencetogoodmanufacturingpracticesandfinishedproducttesting.Wehave
little,ifany,controloverhandlingproceduresonceourproductshavebeenshippedfordistribution.Evenaninadvertentshipmentofcontaminatedproductsmay
beaviolationoflawandmayleadtoincreasedriskofexposuretoproductliabilityclaims,increasedscrutinyandpenalties,includinginjunctivereliefandplant
closings,byfederalandstateregulatoryagencies,andadversepublicity,whichcouldexacerbatetheassociatednegativeconsumerreaction.Anyofthese
occurrencesmayhaveanadverseeffectonourfinancialresults.
Inaddition,wemayberequiredtorecallsomeofourproductsiftheyspoil,becomecontaminated,aretamperedwithoraremislabeled.Awidespreadproduct
recallcouldresultinsignificantlossesduetothecostsofarecall,thedestructionofproductinventoryandlostsalesduetotheunavailabilityofproductfora
periodoftime.Suchaproductrecallalsocouldresultinadversepublicity,damagetoourreputation,andalossofconsumerconfidenceinourproducts,which
couldhaveamaterialadverseeffectonourbusinessresultsandthevalueofourbrands.
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