Tyson meets goal of being able to cover 2011 maturities with cash

By Jennifer Lanning Drey

Portland, Ore., March 1 - Tyson Foods, Inc. has enough cash to cover the remaining $556 million of bonds it has maturing in 2011, meeting its goal of not being in a position where it would be forced to refinance the debt at its maturity, Dennis Leatherby, chief financial officer of Tyson, said Monday during a presentation at the JPMorgan Global High Yield and Leveraged Finance Conference in Miami.

"We would prefer if we did come back and refinance, we would want to be investment grade," he added. "We like the flexibility and the size of that market."

Earlier in the presentation, Leatherby noted that "from a philosophical standpoint," Tyson plans to continue to pay down debt and expects to improve its debt-to-EBITDA and interest-expense ratios as a result.

Investing in the business will be a priority for cash deployment in the future, as the company has a number of projects that could enhance operating efficiencies to drive safe returns going forward, he said.

"Share buybacks would be the lowest priority by far," Leatherby said in response to a question following his formal remarks.

"We'd rather buy back bonds and move back to investment grade. That's certainly a goal to get back to investment grade as quickly as we can, but we know that's not going to be easy because of our results in '06 and '08," he said.

Acquisitions are also a possibility for cash deployment, although the company currently has nothing on the radar, he said.

Tyson is a Springdale, Ark.-based processor and marketer of chicken, beef and pork.

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