Tyson Foods, Inc. (TSN) Earnings Call Transcript & Summary

Good morning. Tyson has been gracious enough to kick off our conference since its inception 17 years ago. Over those years, Tyson has markedly transformed itself in terms of strategic direction, operational performance and capital deployment. Less than a year ago, the Board chose Donnie as the new CEO to reposition its Chicken operations and lead the company into a new growth phase. Without hesitation, the Board not only made the right decision but also the only possible decision. With 37 years of experience and unparalleled track record of delivering industry-leading performance, there's not anyone else in the world with the perfect blend of leadership, business acumen and operational expertise to position Tyson to realize its full potential. To enhance a very strong operational team, Stewart, Tyson's CFO, continues to execute financial discipline and strategic investments to enable Tyson to achieve its full earnings and growth potential. We cannot be more appreciative of you taking the time to be with us today. With that, let me kick it off with the introductory comment -- question. Again, thank you guys very much.

So Donnie, you were the key architect to successfully restructuring of the Chicken operation about 10 years ago. You returned to Tyson with a similar challenge in Chicken operations. Can you compare the differences between those 2 times? And more importantly, how do you set up the company for success after you decide to move on or so to not have a retrenchment in performance? And just to be clear, we're not looking for you to leave. I just want to just kind of make sure because we don't want to have this episode to happen again. So I just want to figure out the comparison and contrast.

Thank you, Ken, and good morning. Good morning, everyone. Thanks for having us. So what a question. We're going to start out aggressive. So Chicken. So I'll think about Chicken in terms of like '08, '09 versus the last year or so. So the differences that I remember about the 2 years, I mean, obviously, over the last couple of years, we've all been dealing with a pandemic. Inflation over the last year or so has been pretty aggressive. And none of us or I certainly don't know where that's going to go or how long that lasts or what new normal looks like in terms of that. Labor is a challenge for us. Today, labor is -- we're in a better position today than we've been in the last 2.5 years. And a number of things that we've been doing in an effort to make Tyson one of the most sought-after places to work. So labor is a challenge. We're still in a pandemic, and we have inflation. The supply of chicken is quite tight as it is in pork. But if I go back to '09, I think about the difference is we had high grain cost back then. Labor was fairly plentiful, and the rates that we were paying were much less than what we're paying today. The environment for us in both of these time periods is that we were underperforming. And we had capacity utilization issues. We had efficiency issues, just a number of things. So those things are similar. But the marketplace is quite different today, and change is really the only certain that I see. And it's part of our everyday life these days. So how do we position ourselves to not only make this Chicken business work? And fortunately or unfortunately, this is my second time to be a part of that. And it's been hard both times. And so our intent today is to make our Chicken business, not only our Chicken business but all of our businesses, not only make them work but make them last and put in great business process, great leaders and making sure that the people we have know what to do and how to do it and have all the resources necessary to do it. But when I came back, Ken, to answer the last part of your question, I made a 5-year commitment to be the CEO. I've completed almost 1 year. So I still have 4 years to go. I'm enjoying what I'm doing. I'm having fun. We have a great team. We're seeing some success, and of course, that makes it a lot more fun. But we have succession planning in place. And we have a 4-year glide path in terms of who's going to be the CEO next. All of the leadership team within Tyson, my direct reports, all of them have development plans, things that they're doing. There will be job rotations. There will be -- we'll make sure that the next CEO has exposure to all of our businesses and had experience actually leading those businesses. And so we feel very good about that. It's probably the most robust -- well, not probably, it is the most robust attempt that we've ever made as a company.

Ken, I'll just throw one other thing that's different for Donnie this time around. If you think about '08 and '09, it was a pretty tough time for a lot of the food industry and Tyson specifically. And I think that as Donnie tries to build the company going forward, he's sitting on a company that has an unbelievably robust balance sheet and financial capability. And in a world that's growing particularly with the food, having that kind of firepower, I think it's going to give Donnie, as the CEO, a lot of optionality.

That kind of leads into the next question. That's great. Look, within about 6 months of being incumbent CEO, you and your team developed among the most comprehensive and detailed strategic plans I've seen in my career, right? It came out in 6 months. You guys were there. One of the key components of your growth algorithm is spending the $1.8 billion to expand capacity by 1.3 billion pounds. What was the strategic rationale for the plants. Particularly, half of them are focused in Asia, 2 on Beef expansion. Does this reduce your appetite for acquisitions? And kind of how do you think about the returns? Two-person question there.

Sure. Let me start off. Stewart, you add what color you will. We found ourselves in a position. It's a great position where our demand was very strong, and we didn't have the adequate capacity to produce the -- and service the customers that we wanted and needed to. And that was across our poultry business. Our Prepared Foods business and then our case-ready Beef and Pork businesses as well. And of course, there's a big story. I'll get to international in just a moment. But we began the process of getting out in front. I would tell you -- I'd be remiss if I didn't tell you. I think we were behind in terms of keeping capacity in front of us. And it takes a little longer to get all those things done, but we're catching up a little bit. But the good news is all the capacity we are putting in, we already have sold. We just need to get it online and going. And so we announced that the building of 12 new plants, which, in my almost 4 decades of working, 1 was a lot in a year, but we did 12. Seven of those were outside of the United States, and they were all ready-to-eat type plants that -- where we had customers and consumers that we did business with domestically, and so we were able to work with our customers and grow that business. And every one of those lines is full on the day that it comes up. In fact, in the Netherlands, we've got a plant coming up right now. That is already full, and it's just starting, and we could fill another one same size if we had it. And so we're trying to catch up with that. And so we announced about, well, $2 billion a year in capital. And if you look at the options of organic versus inorganic, the organic option is obviously a -- is more attractive from a return standpoint to us. And so we just -- we made our minds up that we're going to get out front and stay ahead. I think that's the "not only making it work but make it last" kind of conversation is that getting ahead and staying ahead. Our growth is good. We've said publicly, privately, anyone that listen that we plan to grow, and we plan to outpace the market in growth. And we have the demand to do that. We have several billion-dollar-plus iconic brands that really do well during inflationary times. Think about the consumer, and the consumer is -- they typically do not experiment with a private label brand or a product during times of high inflation. We have the Great Recession to look back on, but they go to those trusted brands because they know what they're getting in that dollar, and that amount of money they're spending is precious to them. So we're investing for growth. We're investing for the future. We're investing to grow our brands and our -- and particularly, our value-added business. But -- and you probably heard from a harvest capacity, particularly in our Chicken business. We've not really added any capacity other than the Humboldt, Tennessee plant, which was 1 of the 12. But it is -- most of the capacity we already had. We just weren't utilizing. So part of what we're going to do to fill those 12 plants is going to be to grow more chicken in our existing operations, which we already have and are carrying the full load of overhead for those. So it's unused capacity. And so every additional head is going to be better for us. But it's all ahead that we already have sold in our further processing facilities.

Yes, I think that's right, Donnie. I mean it's a combination not just of deploying extra capital but of making the best use of the assets we already have. There's no profit that's better profit than filling up plants that -- where you've got capacity that you can use. In the chicken space, we've told the market, we've got up to 15% more headroom with pretty limited capital requirements. That's going to be really profitable business.

Can you -- just as a follow-up, what is the anticipation on the return on invested capital? How does it vary by plan? And to what extent does this accelerate your profit growth and over what time frame? If there's some...

You know the...

Our return on invested capital...

Capital for these plants, how do you think about that?

We haven't actually said anything sort of publicly about what the specific targets are. But I'd said -- to say these are sort of -- our target is well in excess of our cost of capital and, I think, double digits.

Perfect. I guess it's fair.

The second one of your growth plan is your $1 billion of productivity savings. I think it's like $400 million in 2022. How much of the savings will fall to the bottom line? How much will be reinvested? And how do you decide between what you do with the money, right? This is some free money that's coming, not free, but it's money that's coming. How do you decide?

Let me start off, and you can touch on some of these. The productivity program that Ken is talking about is we announced in our Investor Day that we're going to save $1 billion through the next 3 years. And in '22, we're on track to deliver $400-plus million of that. And these are not gross dollars. These are net dollars to the bottom line. So that's an important number for you to get. We've built that into our financials. And so that is a number of different things contributing to that. It is just being better at what we do. It's being more efficient. It's being -- running lines at rate. It's capturing yield. But there's a great deal of this that is automation and technology. It could be deboning for chicken. It could be -- we have -- in this program, we have a programmatic approach to automation. For example, with all the plants that we have, if we just attack an area such as palletizing and we scale that across the enterprise, there's a number of jobs and difficult jobs that we could repurpose. Case packing is another area that would be very programmatic. Deboning, and we're scaling deboning across our Chicken assets, the automated -- automation for that. But there's technology around autonomous planning and things that will make us more efficient throughout the supply chain and moving of products around. But good news is we made the commitment because we saw the opportunity, but it's about being a low-cost producer, being a very competitive company in the marketplace. And so those are all going well. We still have things to do. And maybe the better news -- our best news is as we uncover these rocks and we track them all, I mean, to the [indiscernible] degree. But every rock we turn over, we find another, and that is -- to me, that's just -- that's a great place to be.

Yes. I mean, look, the only thing I'd say is, by the way, some of the cost reduction programs are good for our customers too because our fulfillment will increase, our processes get more efficient. So there are some other attendant benefits other than just dropping money to the bottom line.

One of your early accomplishments that I think can go unnoticed is your attention to your employees, wages, benefits, flex schedule. How do you differentiate your approach to your peers? And what are the most tangible results from your actions that you could kind of point to?

Sure. I think all of us -- certainly, we did had a bit of a wake-up call during the earliest days of the pandemic, and we're all recruiting for the same -- for a lot of the same talent. And so we, as Tyson, we coalesced around trying to become the most sought-after place to work. We fully understand that anyone that would come to work for us would have the option of going to work for anyone else they wanted to. And we had to create a differentiated place to work to be able to attract and to be able to retain the talent we needed to grow this business, as I've already described. So we've done a number of things, for example, increased wages and benefits. I mean those are ones -- I mean, those -- we've talked about those a lot. Our average pay rate is about $24 an hour and -- across Tyson. And we feel good about that. We enjoy the fact that we're paying more. And it's -- that, alone, is helping with turnover and absenteeism. But we've done so much more than that. Wages and benefits are the easy ones to do from my standpoint. We've added online or on-site or near-site health clinics. I think we have 7 online, and we got more coming. So the team members and their families could -- can get treated for sickness, wellness programs, prevention treatments and convenient for our team members and their families. And that's at little to no cost to our team members. But we've done things like flexible work schedules. We've got team members that want to work 3 days a week, or some want to work 6 days a week, and we're trying to align work schedules across our enterprise that line up with what our team members want to do. And if somebody only wants to work 3 days a week, then we need to provide an opportunity. And so there's some technology around that and how that works with the whole digital platform that we have. But we're trying to create that flexibility for team members. Next thing we've done, we -- it was about 6 weeks ago. We announced -- I was in Humboldt, Tennessee, and we announced a public-private sector partnership on child care. That was our second location where we have child care that we're piloting, experimenting with. And there's a subset of our population that have a -- they have a real need for child care. And so creating flexible schedules and then having child care, and it's not just baby sitting. These are schools. These are classes and curriculum so that we can -- so the parent can feel really good about their kids being in this every day. Now that's not something that everybody needs, but it's something that many need. And so that's part of the flexibility and optionality that we're giving team members. We've announced things like ridesharing and transportation. I mean this is a laundry list of things. Our workforce, we have people from 160 different countries. We speak 50 different languages across our plants. So immigration is -- and that is really important to us. And we have team members that -- we announced that we're going to spend $1 million in legal support and education. For those of them that wanted to become a U.S. citizen, we would be a part of the process of helping them do that. And then I'll -- the last one that I'll mention is that we announced 2 weeks ago about an education program. So any team member of Tyson, you can -- we'll pay for all the expense of a master's degree, a bachelor's degree, an associate's degree, any kind of skills or education and training all the way through English as a second language. And that's been well received in our places of business. And so we're excited about all those. We realize that team member has options in terms of where they work, and we want them to come to work. And as I say, with all of my friends and colleagues in the room is that we're not trying to solve the U.S.'s labor problem. We're trying to solve Tyson, and so we're trying to create a differentiated place to work.

How has your utilization rates changed as you've done these programs? How are they relative to history? And how far are you away from achieving what you prefer as your optimal levels?

Sure. Well, first, I'll start with the end. We'll never arrive because we're never going to get satisfied. But I would tell you that our absenteeism, turnover have all improved. I think we're seeing the benefit of some of the things that I just described. Line efficiency, running lines at rate are all doing better. Our capacity utilization across all of our businesses are improving. And we feel very good about that. And we think what we did is -- was what is delivering the result that we're seeing today.

You outlined several key Chicken initiatives at your Analyst Day. I want to find out where you stand on the progress towards increasing fully cooked capacity, ingredient solutions, reposition small bird to improve and upgrading export legs. So you've gone through a lot of these initiatives. Where do you stand on that? And where do you stand on your productivity as well? Are you on track, ahead of track? How do you think about that?

In terms of Chicken specifically, you're right. There's a laundry list of things that we're doing. Again, nothing earth shattering in terms of what they are, but they're all very important. The fundamentals are still really important to us. And -- but in terms of fully cooked capacity, I talked about the 12 plants, much of the capacity, roughly 9 of those facilities are fully cooked, ready-to-eat type facilities. And all of them will be online by this time next year, I believe. In fact, we've got -- outside the U.S., we've got several coming online in our Q3 and Q4. But getting ahead on that and making sure that we can take care of our customers and our growing business, they're good. Capacity utilization, as I mentioned, we're already working on blueprints and drawings and the land purchases for the next series of fully cooked plants. And that's where we're seeing our -- the most growth. And we think that will be important in this inflationary environment as if whether you're talking food -- particularly, food away from home, when you have skilled, unskilled or no labor in back of the house, having ready-to-eat type products, I think, is an advantage for that owner operator at a store level.

And what about the hatchability and the productivity side?

Sure. I'm sorry. Thanks for reminding me that. We are on track with that. I would tell you from a hatch productivity, we're a little bit ahead of where we planned to be at this time. It's -- we're dealing with animals, and sometimes, that I wish I could just turn the page and it'd be all the way bright, but think about how long it takes to produce an animal. In Chicken, for example, if you were going to consume a chicken breast today, in the restaurant here, you would -- you're about 40 weeks away in terms of making a decision to be able to have that chicken breast. So it's a slow process. It seems like it's never going to arrive. But I can tell you that it's right in line with where we plan to be if -- and maybe a little ahead.

And demand elasticity has been a topic du jour. How does your portfolio set up for demand elasticity? Which products have the most elasticity? Which ones have the least? And at what point do you think demand elasticity will become a bigger issue across the whole portfolio?

Yes, that's a great question. And let me try to answer that. And we obviously look at all that every day, and we have teams that, in fact, look at that every day. And we're always on the edge, and I'll be candid with you. Our models that we have in place would have said that, at this point, with this level of pricing, that it would be more elastic than what we've seen. It's been more inelastic than what we would have predicted, which is a good thing. We're still seeing very strong demand at retail. We got a recovering foodservice environment. It's a bit uneven. In Chicken, for example, it's very strong in foodservice as it returns. There's a few categories in the prepared side that are a little slower, but the marketplace is holding up. And I did a -- I testified before Congress a couple of weeks ago around beef. And one of the things I looked at, at that point, Ken, is -- the -- in 1960, 18% of the disposable income was spent on food in 1960. In '21, that was 8.6%. So this U.S. food supply chain is -- it's the best in the world. It's the most resilient in the world. And so I'm very proud of that. Yes, I don't like inflation. I want food accessible and affordable for everyone. And we all -- we are concerned about the prices going up and creating what you and everyone else is concerned about, including us. But the volume impacts from that pricing. But this is an unusual inflationary environment. We've seen inflation from 20% to 30% increases, I mean, across virtually every input. And so we're simply going to customers and ultimate consumers just trying to get a fair market value for that inflation. We're not asking them to pay for any inefficiency that we have. We're just asking you to pay for the inflation. And grain is an easy one to look at. Fuel is an easy one to look at, but these are big numbers in our space.

Maybe only one other thing to add, Ken. And really, if you look at elasticity in our business and you looked at previous recessions or tougher times, I mean, people will trade in and around protein. And the good news for us, of course, is that because of the portfolio we have, if you want to change out of beef into chicken or you want to go from pork to something else or a different cut to another cut, I mean, we offer the -- we service the waterfront and a wide range of prices. So we're really positioned in a place where -- from an elasticity perspective, we're going to capture the consumer. It's just a question of where in the portfolio they're going to go.

Tyson has a 10% to 12% margin goal for Prepared Foods. What are the key levers that will get you there? Is it about operational efficiency? Is it about getting -- filling the volume? Is it about connecting one side of the business to the other side? How do you get to that 10% to 12%? And what are the key 2 or 3 levers that will create that margin?

Sure. We do believe it's a 10% to 12% business over time. It will be there. You may have a quarter that may be lower than that or could be a blowout quarter. But that's where we think this will be, and we're spending appropriately. Yes, the levers of efficiency running lines, servicing customers, making sure that the volume stays in front of us is important to that. But we're also -- we also have a number of billion-dollar-plus brands with Jimmy Dean, Hillshire, Tyson, Ball Park and others that we continue to invest in, and they continue to grow in terms of share. So we feel good about that. I don't know. There's nothing outside our control, if you will, that we're counting on. But just having a great value proposition, brands, our research and our history indicate that those brands tend to hold up better during high inflationary times, more so than private label or store brands or...

Are there opportunities for you to go into adjacencies or new categories? Or is it, hey, stay in our lane, we just need to become more efficient?

I think there's -- I think we need to always be more efficient. There's always a way to get one more to be better, to do a little bit better. There's always a way to do that. But we're always looking at adjacencies, and we start with the consumer. And we tried to determine exactly what it is they need and try to provide a solution for them. And we find that when we provide that solution, like could be Jimmy Dean breakfast sausage or any of the Tyson products that we have, whenever we provide that solution, they pick it up off store shelf.

How do you plan on balancing pricing actions and need to use ad spending and promotions to drive volume through your plans? Like what is the calculus there?

Well, I mean, there's an algorithm that you can look at that I'm not smart enough to explain. But we have some very capable people and Noelle O'Mara and her team that are literally looking at this nonstop. We're doing -- we're studying this consumer in their behavior, nonstop. We get a report out every month in terms of what they did but, more importantly, where we think they're headed and what that looks like. And that's inclusive of what the impact of inflation, consumer confidence as well as employment levels, I mean, the whole deal that I'm sure most everybody in here does. But we have our eye on those critical levers that drive our volume and share growth.

We've been talking a lot basically about a lot of capital spending. It's funny in your analyst presentation, the only real mention of acquisitions was within the Prepared Foods division. What are you looking for? And how important is acquisitions to the Prepared Foods division?

Sure. Well, we want to grow. So there's -- the organic growth will continue to be aggressive as it relates to organic growth. We simply have the demand there. But we're always looking for new lines, new brands and places and ways to -- maybe an extension for a customer. We have some really, really great customers out there. And part of our growth opportunity outside the U.S. has been because of those U.S.-based customer relationships. And that's been really important to us as we've grown internationally. We've now launched brands outside the U.S., the Tyson brand. We sell Jimmy Dean and Hillshire outside the U.S. There's opportunity to sell a great deal more. So there is productive capacity, but from an M&A standpoint, we're always looking and thinking through different options. Today is no different than that. We're exploring the waterfront and seeing what's out there. But when we find something that makes sense, we'll be very disciplined and when we do that. But otherwise, we'll continue to grow organically and reinvest in our business and our shareholder.

Yes. I mean the only thing I'd add, Ken, is just to say, look, I mean I think Prepared Foods has got a lot of opportunity. If you look at the penetration rates of some of our products, even though they have #1 leading shares, there's plenty of penetration to go. We could get into more households. So I think that's point number one. Point number two, look at some of the places where we're innovating. Think about snacks. We've developed a line of kids snacking and adult snacking, and the growth there is good. Those are multibillion-dollar categories that we're just touching. Remember, we touch all those customers. We've got all the routes to market. We've got all the ingredients that we need to make that and the manufacturing facilities, right? So there are places organically to build on what Donnie is saying, where we've got ability to just reach further. And if something comes along from an M&A perspective that is complementary to all of that, well, that's great, but it's not essential for us to be successful in that business.

I think it's important. And let me say this one more time. We have a very disciplined approach to do that. We don't wake up 1 day with, I think we ought to buy something. It's -- I mean, we obviously will have done our homework, and it will need to fit our strategy. But it's a very disciplined approach. That's how we got to 1.1x net debt to EBITDA.

And maybe one other thing, just to follow on that. Look, if that's the only place you're mentioning in our script, well, then that wasn't because that was by some special design. Tyson has a long history of successful M&A. Country -- the company has been built heavily on that, and there could be opportunities in any part of the business. But I think Donnie is right, there's no -- we're not burning hole in that bucket to say, we've got to go out and do something. If we find something, we are, as a team, very focused on driving the right return levels, whether that's capital, whether that's M&A, whether that's investing in a promotion. Ultimately, we're investing shareholder money. We want that to be done powerfully.

You've doubled your outlook on beef packer margins from way back to now. What has structurally changed to create that change in the operating margins?

Yes. That's really a great success story. As a company, for years, I mean, I remember Don Tyson talking about this many, many years ago about always valuing up the portfolio. And I think the Beef story is one that's very similar to that. And let me break that apart for you. So today, we start with the consumer. And that consumer today, it desires U.S. grain-fed beef. It's -- they desire a better quality of beef, a better eating experience, and they're willing to pay for it. So we start with the consumer there. So we go back through the supply chain, and we work with ranchers and feeders, and there's a lot of money spent on the genetics of the animals that will, ultimately, be beef on someone's table. But the genetics have improved. And you can see it most -- you can see it really easily in the grading of animals. If you go back 20 years ago, a grade of beef, prime and choice, you would see about 60% prime, choice. Today, those animals will deliver 85-plus percent prime and choice. And so the quality of meat has improved. So you got genetics, you got better grade. And you also have a larger -- more people interested in consuming this beef. For example, in the U.S., it's been very popular for a long time. But China, for example, now has fallen in love with U.S. grain-fed beef and the higher-quality beef. And so that's a great export market, which then enables us to keep the cutout up on beef and pay more for the cattle that we buy on the front end. So the farmer, rancher, the feeder, the processor and the customer all value up. And so that's how we get to that. But the other component of this is, if you think cutout is the specialty products. For example, in this environment, the fats and oils are really accretive to us with the price of oil. And so that also helps hide virtually every part of the animal that we don't consume or don't prefer here in the U.S. It gets consumed outside the U.S., and all of those are becoming -- are good prices but are ever improving in terms of pricing. So the whole cutout, the cattle prices are going up. The price of beef and the cutout of beef is going up.

The cattle cycle seems to be going through a contraction. And yet we've seen some announcements for capacity expansion. How do you juxtapose those 2 together to make sense of that? And does that really align? Is that -- will the capacity really come online? How do you think about that in the next couple of years?

Sure. I guess you can still think of beef as very cyclical in nature. There has been a conversation around more processors coming online. And much of that had to do with the pandemic when there was ample cattle and there was strong demand, but the processor in the middle couldn't get the labor in because of pandemic and interruption from the pandemic. So there are many that decided that we needed more processing capacity. As a company, we welcome that. We welcome competition. Kind of the water's warm, come in and get you some. But it's expensive to put up a beef plant, and you're talking close to $1 billion depending on if it's any size and scale. But others are wanting to get in there. And so I don't think they're looking at a point in time in the cycle to make that decision. They're just making a business decision on -- over the long haul.

So Tyson, over the years, has clearly and unhesitatingly outperformed what we see as pork packer margins. And obviously, they look like they've come in, but you guys have done a much better job than what we see. What is it that separates you guys from that type of industry margin? What do you guys do better? How do you differentiate yourself?

Yes. There are several things, but let's start with -- our Pork operations run very, very well. We depend on -- we grow -- we own about 10% of the animals we process. And the other 90%, we have relationships with farmers, and so that relationship is good. We have good supply of animals and strong relationships with our farmers. And they've been there for us, but we also process those very well. We're in the right geographies. And the market has been very good from domestic as well as an international perspective. Bellies obviously drive much of that. And then I think the one thing that differentiates us is we have this Prepared Foods business that produces bacon and Wright Brand Bacon, Jimmy Dean bacon as well as Hillshire Farm lunch meats and the like. So in terms of options, whether that be into a branded portfolio with those raw materials, up to -- from an export perspective, I mean, export demand is still very strong. We've never been a big exporter into China, which I know there's a lot of concern here. But we have other markets around the world that we have enjoyed for years.

And do you think that the connection between the Prepared Foods and the Pork division has grown together? Is there more work to do between the 2 operations? Or have they been synchronized already?

Well, they're largely synchronized, and there's a great working relationship between the 2 businesses. There's always an opportunity, for example, ham muscles, how to value up more of those. I mean that one is kind of a running joke around when we all get together as business units, and we talk about that. Shane Miller will tell Noelle that he still has ham muscles. And many of those get exported as a bone-in ham muscle and that we need new products. And so there's some good friendly competition and encouragement going on with that. But there's always an opportunity to value up more of that. But I do think that the fact that we have Prepared Foods provides a differentiated opportunity for us.

Great. And now last 2 to 3 minutes. In 3 years from now, when you look back, how would you measure your success? And what will be your defining mark on the company?

I think I would say -- I'll just say what I talk to my team about every chance I get. And it's really very simple. We want to be -- we want to win with our team members, making -- becoming the most sought-after place to work, having the ability to change lives and, in many cases, for generations through educational opportunities through citizenship, through an attractive wage rate and so forth. We want to be a part of that. We'll do a lot of that through eliminating difficult jobs through automation and technology. I would tell you that being our customers' go-to supplier, what I would describe as winning with customers and consumers, that's not just servicing them. That's being easy to do business with them. That's when they think about something that they need, they would think Tyson first, that would be important to me. And then executional excellence. I tell our team all the time that everybody has assets. Everybody has money. Everybody has customers and people, but that company that executes the best is the one that is going to be the most successful. That is the only long-term sustainable advantage you have in the marketplace. And so I'm relentless in terms of execution and doing your job right, doing it right the first time, whether that be return on invested capital, returns to shareholders, turnover, absenteeism, safety record. Every one of those things matter, but it's executional excellence. And then finally, I would say, from a sustainability perspective, ES&G, I want to leave this planet better than I found it. And I think we, as a company, have a responsibility to do everything we can do. We've made some commitments about net-zero greenhouse gas emissions but zero waste to the landfill. There's a number of different things that we can do, but we want to be a player, and we want to be a leader in leaving this planet in a better way than we found it.

That's great. And with that, we'll end there, and thanks for kicking off our live conference again. Thank you so much.

Thank you.