What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2021-08-09 compared with 2021-05-10 · 175 added, 166 removed, 315 unchanged (52% of the section changed)

20 unchanged sentences

We have experienced and continue to experience multiple challenges related to the pandemic.

These challenges increased our operating costs and negatively impacted our sales volumes for the second quarter and first six months of fiscal 2021 and are anticipated to continue through fiscal 2021.

Each of our segments has also experienced a shift in demand from foodservice to retail;

however, the volume increases in retail have not been sufficient to offset the decreases in foodservice.

As a result, we expect to continue to see decreased volumes through fiscal 2021 in our Chicken and Prepared Foods segments.

These current trends will likely continue through fiscal 2021, while the long-term impact of COVID-19 remains uncertain and will depend on future developments, including the duration and spread of the pandemic and related actions taken by federal, state and local government officials to prevent and manage disease spread, and effectively distribute and administer vaccinations, all of which contain some level of uncertainty and cannot be easily predicted.

These challenges increased our operating costs for the third quarter and first nine months of fiscal 2021 and are anticipated to continue through at least the remainder of fiscal 2021.

Each of our segments experienced a shift in demand from foodservice to retail during fiscal 2020 and are seeing varying levels of foodservice recovery and the return of volumes in fiscal 2021.

The long-term impact of COVID-19 remains uncertain and will depend on future developments, including the duration and spread of the pandemic, COVID-19 variants and resurgences, and related actions taken by federal, state and local government officials to prevent and manage disease spread, and effectively distribute and administer vaccinations, all of which contain some level of uncertainty and cannot be easily predicted.

Additionally, we continue to assess the potential of more permanent impacts to our businesses.

1 unchanged sentence

To protect our team members, we implement safety measures recommended by the Centers for Disease Control and Prevention (“CDC”) and the Occupational Safety and Health Administration (“OSHA”) in our facilities and coordinate with other health officials as appropriate.

We have also hired a chief medical officer, added 200 nursing staff and developed an “always-on” testing strategy rooted in contact tracing.

In preparation for vaccinations, the Company has been providing expert resources and education about the vaccine to team members.

Currently, over 42,000 of our U.S.

In addition to hiring a chief medical officer, we have added 200 nursing staff and developed an “always-on” testing strategy rooted in contact tracing.

In August 2021, we announced all team members are required to be fully vaccinated by November 1, 2021, subject to ongoing discussions with locations represented by unions.

Currently, nearly 59,000 of our U.S.

employees have been vaccinated at events held onsite at Tyson facilities or through an external source across the country.

2 unchanged sentences

We are committed to doing our best to ensure the continuity of our business and the availability of our products to customers.

Our production capabilities, including our large scale and geographic proximities, allow us to adapt some of our facilities to the changing demand by shifting certain amounts of production from foodservice to retail.

Not all of our facilities can be adapted and as a result we experienced a net negative impact to our volumes.

Our production capabilities, including our large scale and geographic proximities, allow us to adapt some of our facilities to the changing demand.

In addition, our production facilities experienced varying levels of production impacts, including reduced volumes, due to the implementation of additional worker health precautions and worker absenteeism.

6 unchanged sentences

The provisions related to income tax will not have a significant impact on our financial statements.

• Liquidity – We generated $1,349 million of operating cash flows during the six months ended April 3, 2021.

At April 3, 2021, we had approximately $2,627 of liquidity, which included availability under our revolving credit facility and $877 million of cash and cash equivalents.

We have $580 million of current debt.

Combined with the cash expected to be generated from the Company’s operations, we anticipate that we will maintain sufficient liquidity to operate our business, make capital expenditures, pay dividends and address other needs including our ability to meet maturing debt obligations.

However, we will continue to monitor the impact of COVID-19 on our liquidity and, if necessary, take action to preserve liquidity and ensure that our business can operate during these uncertain times.

This may include temporarily suspending share repurchases, suspending or reducing dividend payments or other cash preservation actions as necessary.

• Overall Financial Condition – We continue to proactively manage the Company and its operations through the pandemic.

2 unchanged sentences

However, we cannot predict the ultimate impact that COVID-19 will have on our short- and long-term demand at this time, as it will depend on, among other things, the severity and duration of the COVID-19 pandemic.

Our liquidity is expected to be adequate to continue to run our operations and meet our obligations as they become due.

We generated $2,656 million of operating cash flows during the nine months ended July 3, 2021.

At July 3, 2021, we had approximately $3,363 million of liquidity, which included availability under our revolving credit facility and $1,613 million of cash and cash equivalents.

We have $1,566 million of current debt.

Revision of Previously Issued Financial Statements

The accompanying Management’s Discussion and Analysis of Financial Condition and Results of Operations gives effect to the revision of our previously reported consolidated condensed financial statements for the three and six months ended March 28, 2020.

For additional information and a detailed discussion of the revision, refer to Part I, Item 1, Notes to the Consolidated Condensed Financial Statements, Note 1:

5 unchanged sentences

and sustain our Company and our world for future generations.

Sales grew 4% in the second quarter and were relatively flat in the first six months of fiscal 2021 compared to the second quarter and first six months of fiscal 2020, respectively, due to sales growth across each of our segments in the second quarter of fiscal 2021, partially offset by a $320 million legal contingency accrual recognized as a reduction to Sales in the first quarter of fiscal 2021.

Our operating income of $1,425 million was up 12% for the first six months of fiscal 2021, and operating income of $720 million for the second quarter of fiscal 2021 was up 40% as strong results in our Beef and Prepared Foods segments were offset by a decline in the results of Pork and Chicken segments.

In the six months ended April 3, 2021, our results were impacted by $19 million of charges related to the relocation of a production facility in China.

In the six months ended March 28, 2020, our results were impacted by $52 million of restructuring and related charges and $16 million of costs, net of insurance proceeds, associated with a fire at one of our beef production facilities.

During the second quarter and first six months of fiscal 2021, we incurred direct incremental expenses related to COVID-19 totaling approximately $95 million and $215 million, respectively, which was recorded in Cost of Sales in our Consolidated Condensed Statements of Income.

• Disposition – In the second quarter of fiscal 2021, we initiated a plan to sell our pet treats business, which is included in our Prepared Foods segment.

In the third quarter of fiscal 2021, we entered into a definitive agreement to sell the business for $1.2 billion in cash, subject to certain adjustments.

The business had a net carrying value of approximately $411 million as of July 3, 2021, which included approximately $44 million of working capital consisting of inventory, accounts receivable and accounts payable, $17 million of property, plant and equipment and $350 million of goodwill.

The transaction closed on July 6, 2021 and we anticipate recognizing a gain from the sale of this business in the fourth quarter of fiscal 2021.

Sales grew 25% in the third quarter and 8% in the first nine months of fiscal 2021 compared to the third quarter and first nine months of fiscal 2020, respectively, due to sales growth across each of our segments in the first nine months of fiscal 2021, partially offset by $225 million and $545 million in legal contingency accruals recognized as a reduction to Sales in the third quarter and first nine months of fiscal 2021, respectively.

Our operating income of $2,487 million was up 22% for the first nine months of fiscal 2021 as strong results in our Beef and Prepared Foods segments were offset by a decline in the results of our Pork and Chicken segments.

Operating income of $1,062 million for the third quarter of fiscal 2021 was up 37% as strong results in our Beef segment were offset by a decline in the results of our Chicken and Pork segments.

In the nine months ended July 3, 2021, our results were impacted by $23 million of charges related to the relocation of a production facility in China.

Results in the third quarter of fiscal 2021 were also impacted by $306 million of charges related to legal contingency accruals.

In the nine months ended June 27, 2020, our results were impacted by $54 million of restructuring and related charges.

During the third quarter and first nine months of fiscal 2021, we incurred direct incremental expenses related to COVID-19 totaling approximately $55 million and $270 million, respectively, which were recorded in Cost of Sales in our Consolidated Condensed Statements of Income.

During the third quarter of fiscal 2020, we incurred direct incremental expenses related to COVID-19 totaling approximately $340 million, of which approximately $315 million and $25 million were recorded in Cost of Sales and Selling, General and Administrative, respectively, in our Consolidated Condensed Statements of Income.

These COVID-19 direct incremental expenses primarily included team member costs associated with worker health and availability, including direct costs for personal protection equipment, production facility sanitization, COVID-19 testing and vaccinations, donations, product downgrades, rendered product and certain professional fees, which was partially offset by the CARES Act credits.

1 unchanged sentence

These direct incremental COVID-19 related costs exclude market related impacts that may have been driven in part by COVID-19, including such items as derivatives, deferred compensation investments, livestock lower-of-cost-or-net-realizable-value (“LCNRV”) adjustments and other market driven impacts to margin and demand.

These costs also exclude incremental operating costs that have become part of our permanent cost structure as we continue to invest in our team members and their health and safety.

Other indirect costs associated with COVID-19 are not reflected in these amounts, including costs associated with raw materials, distribution and transportation, plant underutilization and reconfiguration, premiums paid to cattle producers, and pricing discounts.

Market Environment

According to the United States Department of Agriculture (“USDA”), domestic protein production (beef, pork, chicken and turkey) decreased 2% in the second quarter of fiscal 2021 compared to the same period in fiscal 2020.

According to the United States Department of Agriculture (“USDA”), domestic protein production (beef, pork, chicken and turkey) increased 6% in the third quarter of fiscal 2021 compared to the same period in fiscal 2020, which was impacted heavily by the global pandemic.

Each of our segments is experiencing improved foodservice demand and continued strength in our retail channels.

We continue to monitor recent trade and tariff activity as well as COVID-19 and its potential impact to exports and input costs across all our segments.

All segments experienced inflation in operating costs, especially in labor, freight and certain materials, and we expect this trend to continue through fiscal 2021.

All segments experienced inflation in operating costs, especially in labor, freight and certain materials, and we expect this trend to continue through the remainder of fiscal 2021.

Additionally, grain and feed ingredient costs have increased substantially, which impacts all of our segments.

We pursue recovery of these increased costs through pricing.

The Beef segment experienced strong demand and ample supply of market-ready cattle but had lower production throughput associated with the impacts of a challenging labor environment and severe winter weather during the second quarter of fiscal 2021.

The Pork segment experienced strong demand but had lower production throughput partially associated with severe winter weather.

The Chicken segment experienced increased costs, volatile market conditions and lower production throughput, which included impacts associated with COVID-19, severe winter weather and a decline in hatch rate during the second quarter of fiscal 2021.

We expect that lower hatch rates will continue in the short-term and may result in added costs, including increased growout expenses and outside meat purchases.

The Prepared Foods segment continued to experience growth in the retail channel but faced increased costs and lower production throughput partially due to the impact of a challenging labor and supply environment and severe winter weather during the second quarter of fiscal 2021.

Our total operating margin was 6.4% in the second quarter of fiscal 2021.

The Beef segment experienced strong global demand and ample supply of market-ready cattle.

The Pork segment experienced strong global demand during the third quarter of fiscal 2021.

The Chicken segment experienced strong demand relative to supply.

The Prepared Foods segment experienced growth, but faced increased costs partially due to the impact of an inflationary environment and challenging labor and supply conditions during the third quarter of fiscal 2021.

Our total operating margin was 8.5% in the third quarter of fiscal 2021.

Operating margins by segment were as follows:

3 unchanged sentences

• Prepared Foods – 6.5%

in millions, except per share data Three Months Ended Six Months Ended

April 3, 2021 March 28, 2020 April 3, 2021 March 28, 2020

in millions, except per share data Three Months Ended Nine Months Ended

July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020

Net income attributable to Tyson $ 749 $ 526 $ 1,692 $ 1,407

Net income attributable to Tyson – per diluted share 2.05 1.44 4.63 3.85

Second quarter – Fiscal 2021 – Net income attributable to Tyson included the following items:

Third quarter – Fiscal 2021 – Net income attributable to Tyson included the following items:

• $306 million pretax, or ($0.64) per diluted share, related to the recognition of legal contingency accruals.

• $4 million pretax, or ($0.01) per diluted share, related to the relocation of a production facility in China.

Six months – Fiscal 2021 – Net income attributable to Tyson included the following items:

• $320 million pretax, or ($0.67) per diluted share, related to the recognition of a legal contingency accrual.

Nine months – Fiscal 2021 – Net income attributable to Tyson included the following items:

• $626 million pretax, or ($1.31) per diluted share, related to the recognition of legal contingency accruals.

• $6 million pretax, or $0.01 per diluted share, of Beef production facility fire insurance proceeds, net of costs incurred.

• $23 million pretax, or ($0.05) per diluted share, related to the relocation of a production facility in China.

Second quarter – Fiscal 2020 – Net income attributable to Tyson included the following items:

• $110 million pretax, or $0.23 per diluted share, due to gain from pension plan terminations.

Six months – Fiscal 2020 – Net income attributable to Tyson included the following items:

Third quarter – Fiscal 2020 – Net income attributable to Tyson included the following items:

• $6 million pretax, or $0.01 per diluted share, due to a gain from pension plan termination.

• $15 million pretax, or $0.03 per diluted share, of Beef production facility fire insurance proceeds, net of costs incurred.

Nine months – Fiscal 2020 – Net income attributable to Tyson included the following items:

• $52 million pretax, or ($0.11) per diluted share, of restructuring and related charges.

• $16 million pretax, or ($0.03) per diluted share, of Beef production facility fire costs, net of insurance proceeds.

• $110 million pretax, or $0.23 per diluted share, due to gain from pension plan terminations

• $116 million pretax, or $0.24 per diluted share, due to gains from pension plan terminations.

Summary of Results

in millions Three Months Ended Six Months Ended

April 3, 2021 March 28, 2020 April 3, 2021 March 28, 2020

in millions Three Months Ended Nine Months Ended

July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020

Sales $ 12,478 $ 10,022 $ 34,238 $ 31,725

2 unchanged sentences

Sales growth 24.5 % 7.9 %

Second quarter – Fiscal 2021 vs Fiscal 2020

• Sales Volume – Sales were negatively impacted by a decrease in sales volume, which accounted for a decrease of $405 million, driven by decreased volumes in each of our segments primarily due to lower production throughput associated with the impact of COVID-19 and severe winter weather in the second quarter of fiscal 2021.

Third quarter – Fiscal 2021 vs Fiscal 2020

• Sales Volume – Sales were positively impacted by an increase in sales volume, which accounted for an increase of $925 million, driven by increased volumes in each of our segments primarily due to improved production throughput compared to the lower production throughput associated with the impact of COVID-19 during the comparable period in fiscal 2020.

• Average Sales Price – Sales were positively impacted by higher average sales prices, which accounted for an increase of $1,756 million.

The increase in average sales price was primarily attributable to favorable product mix related to strong demand in the retail channel across all of our segments.

Six months – Fiscal 2021 vs Fiscal 2020

• Sales Volume - Sales were negatively impacted by a decrease in sales volume, which accounted for a decrease of $885 million, driven by decreased volumes in each of our segments primarily due to lower production throughput associated with the impact of COVID-19 and severe winter weather in the second quarter of fiscal 2021, partially offset by increased volumes in our Beef segment during the first quarter of fiscal 2021 due to a reduction in production capacity as a result of a fire that caused the temporary closure of a production facility for the majority of the first quarter of fiscal 2020.

The increase in average sales price was primarily attributable to favorable product mix and the pass through of increased raw material costs.

• The above change in average sales price for the third quarter of fiscal 2021 excludes a $225 million reduction of Sales from the recognition of legal contingency accruals.

Nine months – Fiscal 2021 vs Fiscal 2020

• Sales Volume - Sales were positively impacted by an increase in sales volume, which accounted for an increase of $40 million, from increased volumes in the third quarter of fiscal 2021 due to improved production throughput compared to lower production throughput associated with the impact of COVID-19 during the comparable period in fiscal 2020.

Sales were further impacted by increased volumes in our Beef segment during the first quarter of fiscal 2021 compared to the reduction in production capacity as a result of a fire that caused the temporary closure of a production facility for the majority of the first quarter of fiscal 2020, which was partially offset by severe weather in the second quarter of fiscal 2021.

• Average Sales Price - Sales were positively impacted by higher average sales prices, which accounted for an increase of $3,018 million.

The increase in average sales price was primarily attributable to favorable product mix related to strong demand in the retail channel across all of our segments.

• The above change in average sales price for the six months ended April 3, 2021 excludes a $320 million reduction of Sales from the recognition of a legal contingency accrual.

The increase in average sales price was primarily attributable to favorable product mix and the pass through of increased raw material costs.

• The above change in average sales price for the nine months ended July 3, 2021 excludes a $545 million reduction of Sales from the recognition of legal contingency accruals.

Cost of Sales

in millions Three Months Ended Six Months Ended

April 3, 2021 March 28, 2020 April 3, 2021 March 28, 2020

in millions Three Months Ended Nine Months Ended

July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020

Cost of sales $ 10,858 $ 8,709 $ 30,188 $ 27,951

1 unchanged sentence

Cost of sales as a percentage of sales 87.0 % 86.9 % 88.2 % 88.1 %

Second quarter – Fiscal 2021 vs Fiscal 2020

Third quarter – Fiscal 2021 vs Fiscal 2020

• Cost of sales increased $2,149 million.

Lower sales volume decreased cost of sales $370 million while higher input cost per pound increased cost of sales $550 million.

Higher sales volume increased cost of sales $821 million while higher input cost per pound increased cost of sales $1,328 million.

• The $1,328 million impact of higher input cost per pound was impacted by:

• Increase of $95 million of direct incremental expenses related to COVID-19.

• Increase in live hog costs of approximately $390 million in our Pork segment.

2 unchanged sentences

• Increase in freight and transportation costs of approximately $120 million.

• Decrease in live cattle costs of approximately $190 million in our Beef segment.

• Decrease due to net derivative losses of approximately $15 million in the second quarter of fiscal 2021, compared to net derivative losses of approximately $100 million in the second quarter of fiscal 2020 due to our risk management activities.

• Increase of approximately $81 million in our Chicken segment related to the recognition of legal contingency accruals.

• Increase in live cattle costs of approximately $70 million in our Beef segment.

• Increase of approximately $15 million in our Beef segment in the third quarter of fiscal 2020 related to insurance proceeds net of costs related to the fire at our production facility.

• Decrease of $285 million due to reduction in direct incremental expenses related to COVID-19.

• Decrease due to net derivative gains of $41 million in the third quarter of fiscal 2021, compared to net derivative losses of $12 million in the third quarter of fiscal 2020 due to our risk management activities.

These amounts exclude offsetting impacts from related physical purchase transactions, which are included in the change in live cattle and hog costs and raw material and feed ingredient costs described herein.

• Remaining increase in costs across all of our segments primarily driven by net impacts on average cost per pound from mix changes as well as production inefficiencies due in part to the impact of COVID-19.

• The $370 million impact of lower sales volume was primarily driven by decreased sales volume in each of our segments due to lower production throughput associated with the impact of COVID-19 and severe winter weather in the second quarter of fiscal 2021.

Six months – Fiscal 2021 vs Fiscal 2020

• Remaining increase in costs across all of our segments primarily driven by net impacts on average cost per pound from mix changes.

• The $821 million impact of higher sales volume was primarily driven by reduced sales volume in each of our segments due to lower production throughput associated with the impact of COVID-19 in the third quarter of fiscal 2020.

Nine months – Fiscal 2021 vs Fiscal 2020

• Cost of sales increased $2,237 million.

Lower sales volume decreased cost of sales $785 million while higher input cost per pound increased cost of sales $873 million.

Higher sales volume increased cost of sales $36 million while higher input cost per pound increased cost of sales $2,201 million.

• The $2,201 million impact of higher input cost per pound was impacted by:

• Increase of $215 million of direct incremental expenses related to COVID-19.

• Increase in live hog costs of approximately $525 million in our Pork segment.

2 unchanged sentences

• Increase in freight and transportation costs of approximately $200 million.

• Increase of approximately $81 million in our Chicken segment related to the recognition of legal contingency accruals.

• Decrease in live cattle costs of approximately $270 million in our Beef segment.

• Decrease due to net derivative gains of approximately $80 million for the first six months of fiscal 2021, compared to net derivative losses of approximately $55 million for the first six months of fiscal 2020 due to our risk management activities.

• Decrease due to net derivative gains of $121 million for the first nine months of fiscal 2021, compared to net derivative losses of $69 million for the first nine months of fiscal 2020 due to our risk management activities.

• Decrease of approximately $16 million in our Beef segment of costs, net of insurance proceeds, related to a fire at a production facility during the first quarter of fiscal 2020.

• The $785 million impact of lower sales volume was primarily driven by decreased sales volume in each of our segments due to lower production throughput associated with the impact of COVID-19 and severe winter weather in the second quarter of fiscal 2021.

• Decrease of $70 million due to reduction in direct incremental expenses related to COVID-19.

• The $36 million impact of higher sales volume was primarily driven by increased volume in each of our segments in the third quarter of fiscal 2021 partially offset by decreased sales volume in each of our segments due to lower production throughput associated with the impact of COVID-19 in the first half of fiscal 2021 and severe weather in the second quarter of fiscal 2021.

Selling, General and Administrative

in millions Three Months Ended Six Months Ended

April 3, 2021 March 28, 2020 April 3, 2021 March 28, 2020

in millions Three Months Ended Nine Months Ended

July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020

Selling, general and administrative expense $ 558 $ 540 $ 1,563 $ 1,728

As a percentage of sales 4.5 % 5.4 % 4.6 % 5.4 %

Second quarter – Fiscal 2021 vs Fiscal 2020

Third quarter – Fiscal 2021 vs Fiscal 2020

• Increase of $18 million in selling, general and administrative was primarily driven by:

• Increase of $40 million in employee costs primarily from incentive-based compensation.

• Increase of $20 million in marketing, advertising and promotion expenses.

• Increase of $10 million in professional fees.

• Increase of $14 million from the impact of a cattle supplier's misappropriation of Company funds recognized in the three months ended March 28, 2020.

• Decrease of $38 million in marketing, advertising and promotion expenses.

• Decrease of $12 million in donations.

• Decrease of $6 million in travel and entertainment expenses.

Six months – Fiscal 2021 vs Fiscal 2020

• Decrease of $12 million in employee costs primarily from incentive-based compensation.

Nine months – Fiscal 2021 vs Fiscal 2020

• Decrease of $165 million in selling, general and administrative was primarily driven by:

• Decrease of $109 million from the change in the impact of a cattle supplier’s misappropriation of Company funds, resulting from a $55 million gain related to the recovery of cattle inventory in the six months ended April 3, 2021 as compared to a $54 million loss recognized in the six months ended March 28, 2020.

• Decrease of $111 million from the change in the impact of a cattle supplier’s misappropriation of Company funds, resulting from a $55 million gain related to the recovery of cattle inventory in the nine months ended July 3, 2021 as compared to a $56 million loss recognized in the nine months ended June 27, 2020.

• Decrease of $66 million in marketing, advertising and promotion expenses.

• Decrease of $48 million from restructuring and related charges.

• Decrease of $16 million in travel and entertainment expenses.

• Decrease of $25 million in donations.

• Increase of $54 million in employee costs primarily from incentive-based compensation.

• Decrease of $12 million in travel and entertainment expenses.

• Decrease of $10 million in commission and brokerage fees.

• Increase of $52 million in professional fees.

• Increase of $42 million in employee costs primarily from incentive-based compensation.

• Increase of $25 million in technology related costs.

Interest Expense

in millions Three Months Ended Six Months Ended

April 3, 2021 March 28, 2020 April 3, 2021 March 28, 2020

in millions Three Months Ended Nine Months Ended

July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020

Cash interest expense $ 111 $ 127 $ 338 $ 372

1 unchanged sentence

Total interest expense $ 105 $ 122 $ 325 $ 361

Second quarter and six months – Fiscal 2021 vs Fiscal 2020

Third quarter and nine months – Fiscal 2021 vs Fiscal 2020

• Cash interest expense primarily included interest expense related to our senior notes and term loans, in addition to commitment fees incurred on our revolving credit facility.

The decrease in cash interest expense in fiscal 2021 was primarily due to the change in outstanding commercial paper as well as the settlement of the 2020 notes during fiscal 2020, partially offset by interest expense related to our term loan facilities.

The decrease in cash interest expense in fiscal 2021 was primarily due to the change in outstanding commercial paper and $1 billion reduction in the Term Loan balance in fiscal 2021 as well as the settlement of the 2020 notes during fiscal 2020.

Effective Tax Rate

Three Months Ended Six Months Ended

April 3, 2021 March 28, 2020 April 3, 2021 March 28, 2020

Three Months Ended Nine Months Ended

July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020

22.1 % 20.9 % 22.9 % 22.6 %

Second quarter and six months – Fiscal 2021 vs Fiscal 2020

• Our effective income tax rate was 23.5% for the second quarter of fiscal 2021 compared to 25.1% for the same period of fiscal 2020, and the effective income tax rates for the first six months of fiscal 2021 and 2020 were 23.5% and 23.6%, respectively.

The effective tax rates for the second quarter and first six months of fiscal 2021 and 2020 were higher than the federal statutory tax rate primarily due to state taxes, partially offset by various tax benefits.

Third quarter and nine months – Fiscal 2021 vs Fiscal 2020

• Our effective income tax rate was 22.1% for the third quarter of fiscal 2021 compared to 20.9% for the same period of fiscal 2020, and the effective income tax rates for the first nine months of fiscal 2021 and 2020 were 22.9% and 22.6%, respectively.

The effective tax rates for the third quarter and first nine months of fiscal 2021 and 2020 were increased by state taxes and decreased by various tax benefits.

Segment Results

3 unchanged sentences

in millions Sales

Three Months Ended Six Months Ended

April 3, 2021 March 28, 2020 April 3, 2021 March 28, 2020

Three Months Ended Nine Months Ended

July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020

Beef $ 4,954 $ 3,653 $ 12,987 $ 11,470

6 unchanged sentences

in millions Operating Income (Loss)

Three Months Ended Six Months Ended

April 3, 2021 March 28, 2020 April 3, 2021 March 28, 2020

Three Months Ended Nine Months Ended

July 3, 2021 June 27, 2020 July 3, 2021 June 27, 2020

Beef $ 1,120 $ 649 $ 2,093 $ 1,114

5 unchanged sentences

Beef Segment Results

in millions Three Months Ended Six Months Ended

April 3, 2021 March 28, 2020 Change April 3, 2021 March 28, 2020 Change

in millions Three Months Ended Nine Months Ended

July 3, 2021 June 27, 2020 Change July 3, 2021 June 27, 2020 Change

Sales $ 4,954 $ 3,653 $ 1,301 $ 12,987 $ 11,470 $ 1,517

3 unchanged sentences

Operating margin 22.6 % 17.8 % 16.1 % 9.7 %

Second quarter and six months – Fiscal 2021 vs Fiscal 2020

• Sales Volume – Sales volume decreased during the second quarter of fiscal 2021 due to a reduction in live cattle processed partially associated with the impacts of severe winter weather and a challenging labor environment.

Sales volume was relatively flat for the first six months of fiscal 2021 as the impacts in the second quarter were partially offset by strong domestic and export demand as well as the prior year impact of a fire which caused the temporary closure of a production facility for the majority of the first quarter of fiscal 2020.

• Average Sales Price – Average sales price increased in the second quarter and first six months of fiscal 2021 as demand for our beef products remained strong.

• Operating Income – Operating income increased in the second quarter and first six months of fiscal 2021 due to strong demand as we continued to optimize revenues relative to live cattle supply, partially offset by production inefficiencies and direct incremental expenses related to COVID-19.

Additionally, operating income was impacted by approximately $60 million and $50 million of incremental net derivative gains in the second quarter and first six months of fiscal 2021, respectively, as compared to the second quarter and first six months of fiscal 2020.

Further, operating income in the first six months of fiscal 2021 was impacted by a cattle supplier's misappropriation of Company funds, which resulted in a $55 million gain related to the recovery of cattle inventory as compared to a $54 million loss recognized in the first six months of fiscal 2020.

Third quarter and nine months – Fiscal 2021 vs Fiscal 2020

• Sales Volume – Sales volume increased during the third quarter of fiscal 2021 due to strong global demand and reduced production inefficiencies associated with COVID-19 compared to the third quarter of fiscal 2020.

Sales volume increased for the first nine months of fiscal 2021 due to strong global demand and increased cattle processed in the third quarter of fiscal 2021 as compared to fiscal 2020, partially offset by the impacts associated with severe weather in the second quarter of fiscal 2021 and a challenging labor environment.

Additionally, sales volume for the first nine months of fiscal 2021 was impacted by a fire, which caused the temporary closure of a production facility for the majority of the first quarter of fiscal 2020.

• Average Sales Price – Average sales price increased in the third quarter and first nine months of fiscal 2021 as demand for our beef products remained strong.

• Operating Income – Operating income increased in the third quarter and first nine months of fiscal 2021 due to strong demand as we continued to optimize revenues relative to live cattle supply, partially offset by production inefficiencies and a net increase in direct incremental expenses related to COVID-19 in the first nine months of fiscal 2021.

Additionally, operating income in the first nine months of fiscal 2021 was impacted by a cattle supplier's misappropriation of Company funds, which resulted in a $55 million gain related to the recovery of cattle inventory as compared to a $56 million loss recognized in the first nine months of fiscal 2020.

Pork Segment Results

in millions Three Months Ended Six Months Ended

April 3, 2021 March 28, 2020 Change April 3, 2021 March 28, 2020 Change

in millions Three Months Ended Nine Months Ended

July 3, 2021 June 27, 2020 Change July 3, 2021 June 27, 2020 Change

Sales $ 1,715 $ 1,115 $ 600 $ 4,631 $ 3,760 $ 871

3 unchanged sentences

Operating margin 3.9 % 9.6 % 5.4 % 10.4 %

Second quarter and six months – Fiscal 2021 vs Fiscal 2020

• Sales Volume – Sales volume decreased during the second quarter and first six months of fiscal 2021 due to a reduction in live hogs processed primarily associated with severe winter weather, which was partially offset by strong demand.

• Average Sales Price – Average sales price increased in the second quarter and first six months of fiscal 2021 due to strong demand.

• Operating Income – Operating income decreased in the second quarter and first six months of fiscal 2021 primarily due to production inefficiencies and direct incremental expenses related to COVID-19.

Additionally, operating income in the second quarter and first six months of fiscal 2021 was impacted by approximately $50 million and $70 million, respectively, of incremental net derivative losses as compared to the second quarter and first six months of fiscal 2020.

Third quarter and nine months – Fiscal 2021 vs Fiscal 2020

Sales volume increased for the first nine months of fiscal 2021 due to strong global demand and increased live hogs processed in the third quarter of fiscal 2021 as compared to fiscal 2020, partially offset by the impacts of a challenging labor environment.

• Average Sales Price – Average sales price increased in the third quarter and first nine months of fiscal 2021 due to strong demand.

• Operating Income – Operating income decreased in the third quarter and first nine months of fiscal 2021 primarily due to lower hog supplies relative to industry capacity as well as production inefficiencies related to COVID-19 and a challenging labor environment, partially offset by a reduction in direct incremental expenses related to COVID-19 in the third quarter of fiscal 2021 as compared to fiscal 2020.

Additionally, operating income in the third quarter and first nine months of fiscal 2021 was impacted by approximately $45 million and $115 million, respectively, of incremental net derivative losses as compared to the third quarter and first nine months of fiscal 2020.

Chicken Segment Results

in millions Three Months Ended Six Months Ended

April 3, 2021 March 28, 2020 Change April 3, 2021 March 28, 2020 Change

in millions Three Months Ended Nine Months Ended

July 3, 2021 June 27, 2020 Change July 3, 2021 June 27, 2020 Change

Sales $ 3,476 $ 3,112 $ 364 $ 9,860 $ 9,801 $ 59

3 unchanged sentences

Operating margin (8.0) % (3.9) % (5.0) % 0.4 %

Second quarter and six months – Fiscal 2021 vs Fiscal 2020

• Sales Volume – Sales volume decreased during the second quarter and first six months of fiscal 2021 due to lower production throughput associated with COVID-19, disruptions due to severe winter weather, decline in hatch rate and a challenging labor environment.

• Average Sales Price – Average sales price increased in the second quarter and first six months of fiscal 2021 due to favorable sales mix and overall market conditions.

The change in average sales price for the six months ended April 3, 2021 excludes a $320 million reduction of Sales from the recognition of a legal contingency accrual.

• Operating Income (Loss) – Operating income decreased in the second quarter and first six months of fiscal 2021 primarily due to a $320 million loss from the recognition of a legal contingency accrual in the first quarter as well as $125 million and $140 million of higher feed ingredient costs in the second quarter and first six months of fiscal 2021, respectively.

Operating income was further impacted in the second quarter and first six months of fiscal 2021 by production inefficiencies and direct incremental expenses related to COVID-19 and disruptions due to severe winter weather.

Additionally, operating income in the second quarter and first six months of fiscal 2021 was impacted by $40 million and $110 million, respectively, of incremental net derivative gains as compared to the second quarter and first six months of fiscal 2020.

Third quarter and nine months – Fiscal 2021 vs Fiscal 2020

• Sales Volume – Sales volume increased during the third quarter of fiscal 2021 primarily due to increased demand in the foodservice channel and reduced production inefficiencies associated with COVID-19 compared to the third quarter of fiscal 2020.

Sales volume decreased during the first nine months of fiscal 2021 from the impact of lower production throughput associated with COVID-19, disruptions due to severe weather in the second quarter of fiscal 2021, decline in hatch rate and a challenging labor environment, partially offset by increased demand.

• Average Sales Price – Average sales price increased in the third quarter and first nine months of fiscal 2021 due to favorable sales mix and inflationary market conditions.

The change in average sales price for the three and nine months ended July 3, 2021 excludes a $225 million and $545 million reduction of Sales, respectively, from the recognition of legal contingency accruals.

• Operating Income (Loss) – Operating loss increased during the third quarter of fiscal 2021 primarily due to a $306 million loss from the recognition of legal contingency accruals and $270 million of higher feed ingredient costs, partially offset by $125 million of incremental net derivative gains as compared to the third quarter of fiscal 2020.

Operating income decreased during the first nine months of fiscal 2021 primarily due to a $626 million loss from the recognition of legal contingency accruals, $410 million of higher feed ingredient costs as compared to fiscal 2020, production inefficiencies related to COVID-19, decline in hatch rate and disruptions due to severe weather, partially offset by reduced direct incremental expense associated with COVID-19 and $235 million of incremental net derivative gains as compared to the first nine months of fiscal 2020.

Prepared Foods Segment Results

in millions Three Months Ended Six Months Ended

April 3, 2021 March 28, 2020 Change April 3, 2021 March 28, 2020 Change

in millions Three Months Ended Nine Months Ended

July 3, 2021 June 27, 2020 Change July 3, 2021 June 27, 2020 Change

Sales $ 2,323 $ 2,035 $ 288 $ 6,600 $ 6,255 $ 345

3 unchanged sentences

Operating margin 6.5 % 7.1 % 9.6 % 7.9 %

Second quarter and six months – Fiscal 2021 vs Fiscal 2020

• Sales Volume – Sales volume decreased during the second quarter and first six months of fiscal 2021 as growth in volume across the retail channel was offset by a reduction in the foodservice channel related to lower demand from the impact of COVID-19.

Additionally, sales volume decreased during the second quarter and first six months of fiscal 2021 due to lower production throughput partially associated with a challenging labor and supply environment and the impact of severe winter weather.

• Average Sales Price – Average sales price increased in the second quarter and first six months of fiscal 2021 due to favorable product mix and the pass through of increased raw material costs.

• Operating Income – Operating income increased in the second quarter and first six months of fiscal 2021 due to lower commercial spend and favorable product mix partially offset by increased operating costs, including a $105 million increase in raw material costs during the first six months of fiscal 2021, as well as production inefficiencies due in part to the impact of a challenging labor and supply environment along with the impact of severe winter weather.

Additionally, operating income in the second quarter and first six months of fiscal 2021 was impacted by $35 million and $45 million, respectively, of incremental net derivative gains as compared to the second quarter and first six months of fiscal 2020.

Third quarter and nine months – Fiscal 2021 vs Fiscal 2020

• Sales Volume – Sales volume increased during the third quarter of fiscal 2021 primarily due to increased demand in the foodservice channel and sustained retail demand as well as reduced production throughput disruptions associated with COVID-19 compared to the third quarter of fiscal 2020.

Sales volume decreased during the first nine months of fiscal 2021 driven by reduced foodservice demand in the first half of fiscal 2021, lower production throughput partially associated with a challenging labor and supply environment and the impact of severe weather in the second quarter of fiscal 2021, partially offset by strong demand in the retail sales channel.

• Average Sales Price – Average sales price increased in the third quarter and first nine months of fiscal 2021 due to favorable product mix and the passthrough of increased raw material costs.

• Operating Income – Operating income increased slightly in the third quarter of fiscal 2021 primarily due to favorable pricing and product mix and the reduction of direct incremental expenses related to COVID-19 compared to the third quarter of fiscal 2020, which was offset by $160 million of increased raw materials costs as compared to the third quarter of fiscal 2020.

Operating income increased during the first nine months of fiscal 2021 due to lower commercial spend as well as favorable pricing and product mix partially offset by increased operating costs, including a $265 million increase in raw material costs during the first nine months of fiscal 2021, as well as production inefficiencies due in part to the impact of a challenging labor and supply environment along with the impact of severe weather in the second quarter of fiscal 2021.

Additionally, operating income in the third quarter and first nine months of fiscal 2021 was impacted by $15 million and $60 million, respectively, of incremental net derivative gains as compared to the third quarter and first nine months of fiscal 2020.

International/Other Results

in millions Three Months Ended Six Months Ended

April 3, 2021 March 28, 2020 Change April 3, 2021 March 28, 2020 Change

in millions Three Months Ended Nine Months Ended

July 3, 2021 June 27, 2020 Change July 3, 2021 June 27, 2020 Change

Sales $ 488 $ 402 $ 86 $ 1,444 $ 1,365 $ 79

Operating income (loss) 4 (8) 12 $ — $ 11 $ (11)

Second quarter and six months – Fiscal 2021 vs Fiscal 2020

• Sales – Sales increased during the second quarter due to increased pricing and were relatively flat for the first six months of fiscal 2021.

• Operating Income (Loss) – Operating income decreased primarily due to a $19 million charge related to the relocation of a production facility in China.

Third quarter and nine months – Fiscal 2021 vs Fiscal 2020

• Sales – Sales increased during the third quarter and first nine months of fiscal 2021 due to increased pricing from favorable product mix.

• Operating Income (Loss) – Operating income increased during the third quarter of fiscal 2021 primarily due to reduced raw materials costs.

Operating income decreased in the first nine months of fiscal 2021 primarily due to a $23 million charge related to the relocation of a production facility in China.

LIQUIDITY AND CAPITAL RESOURCES

7 unchanged sentences

and overall market conditions.

In addition, we will continue to monitor the impact of COVID-19 on our liquidity and, if necessary, take action to preserve liquidity and ensure that our business can operate during these uncertain times.

This may include temporarily suspending share repurchases, suspending or reducing dividend payments or other cash preservation actions as necessary.

Cash Flows from Operating Activities

in millions Six Months Ended

April 3, 2021 March 28, 2020

in millions Nine Months Ended

July 3, 2021 June 27, 2020

Net income $ 1,702 $ 1,414

5 unchanged sentences

Net cash provided by operating activities $ 2,656 $ 2,708

• Cash flows associated with net changes in operating assets and liabilities for the six months ended:

• April 3, 2021 – Decreased primarily from increased accounts receivable, inventories, derivative net assets and decreased accrued salaries, wages and benefits, partially offset by increased taxes payable and legal accrual .

• Cash flows associated with net changes in operating assets and liabilities for the nine months ended:

• July 3, 2021 – Decreased primarily from increased accounts receivable and inventories, offset by increased accounts payable and legal accruals .

The increase in accounts receivable is largely due to the timing of sales.

The increase in inventory is primarily due to increased raw material and grain costs.

The decrease in accrued salaries, wages and benefits is primarily due to the payment of the annual incentive plan.

The increase in taxes payable is primarily due to payroll tax deferrals associated with the CARES Act.

The increase in legal accrual is due primarily to a legal contingency recorded in the first quarter of fiscal 2021.

• March 28, 2020 – Decreased primarily from decreased accounts payable and increased accounts receivable .

The changes in these balances are largely due to timing of payments and sales.

The increase in accounts payable is due to the timing of payments.

The increase in legal accruals is due primarily to legal contingencies recorded during fiscal 2021.

• June 27, 2020 – Increased primarily from decreased inventory and accounts receivable and increased taxes payable, partially offset by decreased accounts payable.

The changes in the inventory, accounts receivable and accounts payable are largely due to timing of payments and sales.

The increase in taxes payable is primarily due to timing of payments, in large part as a result of the extension of tax payment due dates in response to COVID-19.

Cash Flows from Investing Activities

in millions Six Months Ended

April 3, 2021 March 28, 2020

in millions Nine Months Ended

July 3, 2021 June 27, 2020

Additions to property, plant and equipment $ (859) $ (907)

5 unchanged sentences

• Additions to property, plant and equipment included spending for production growth, safety and animal well-being, acquiring new equipment, infrastructure replacements and upgrades to maintain competitive standing and position us for future opportunities.

We expect capital spending for fiscal 2021 to be at the lower end of the $1.3 billion to $1.5 billion range.

• Acquisition of equity investments relates to the purchase of a 40% interest in a vertically integrated Brazilian poultry producer and a 50% interest in a joint venture serving the worldwide fats and oils market.

• Other, net for the first six months of fiscal 2021 and the first six months of fiscal 2020 primarily included changes in deposits for capital expenditures.

We expect capital spending for fiscal 2021 to be approximately $1.3 billion.

• Acquisition of equity investments for fiscal 2021 related to the purchase of a 49% minority interest in a Malaysian producer of feed and poultry products, and for fiscal 2020, included the purchases of a 40% interest in a vertically integrated Brazilian poultry producer and a 50% interest in a joint venture serving the worldwide fats and oils market.

• Other, net for the first nine months of fiscal 2021 and the first nine months of fiscal 2020 primarily included changes in deposits for capital expenditures and the receipt of $69 million related to split-dollar life insurance proceeds.

Cash Flows from Financing Activities

in millions Six Months Ended

April 3, 2021 March 28, 2020

in millions Nine Months Ended

July 3, 2021 June 27, 2020

Proceeds from issuance of debt $ 573 $ 1,589

9 unchanged sentences

Net cash used for financing activities $ (1,542) $ (594)

• During the first six months of fiscal 2021, proceeds of $557 million from issuance of debt included $500 million of proceeds from the issuance of a term loan facility due March 2023.

• During the first nine months of fiscal 2021, proceeds of $573 million from issuance of debt included $500 million of proceeds from the issuance of a term loan facility due March 2023.

• On March 27, 2020, we executed a $1.5 billion term loan facility to repay our commercial paper, repay outstanding balances under our revolving credit facility and for general liquidity purposes.

On April 1, 2020, we borrowed the full $1.5 billion available under the term loan facility and used it to repay the $1.0 billion of outstanding commercial paper obligations and to repay the $200 million outstanding balance under the revolving credit facility.

During the first six months of fiscal 2021, we extinguished the $1.5 billion outstanding balance of our term loan facility using proceeds received from the issuance of debt and cash on hand.

• During the first six months of fiscal 2020, the net impact from our commercial paper activity was not significant.

• Purchases of Tyson Class A stock included:

• $150 million of shares repurchased pursuant to our share repurchase program during the six months ended March 28, 2020.

• $34 million and $46 million of shares repurchased to fund certain obligations under our equity compensation programs during the six months ended April 3, 2021, and March 28, 2020, respectively.

• Dividends paid during the six months ended April 3, 2021 reflected a 6% increase to our fiscal 2020 quarterly dividend rate.

During the first nine months of fiscal 2021, we extinguished the $1.5 billion outstanding balance of our term loan facility using proceeds received from the issuance of debt and cash on hand.

• On July 23, 2021, subsequent to the end of our third quarter of fiscal 2021, we redeemed all of our 2.25% Senior Notes due August 2021 using cash on hand at a redemption price equal to 100% of the principal amount, plus accrued and unpaid interest as of the redemption date.

At July 3, 2021, the outstanding principal amount was $500 million.

• During the first nine months of fiscal 2020, we extinguished the $350 million outstanding balance of our senior notes due June 2020 using cash on hand.

• During the first nine months of fiscal 2020, the net impact from our commercial paper activity was not significant.

• Purchases of Tyson Class A stock included $150 million of shares repurchased pursuant to our share repurchase program during the nine months ended June 27, 2020 and $50 million of shares repurchased to fund certain obligations under our equity compensation programs during each of the nine months ended July 3, 2021, and June 27, 2020.

• Dividends paid during the nine months ended July 3, 2021 reflected a 6% increase to our fiscal 2020 quarterly dividend rate.

Expiration Date Facility

3 unchanged sentences

Borrowed Amount

April 3, 2021

Cash and cash equivalents $ 1,613

5 unchanged sentences

• Liquidity includes cash and cash equivalents, short-term investments and availability under our revolving credit and term loan facilities, less outstanding commercial paper balance.

• At April 3, 2021, we had current debt of $580 million, which we intend to refinance or repay with cash generated from our operating activities and other existing or new liquidity sources.

• At July 3, 2021, we had current debt and accrued legal contingencies of $1,566 million and $652 million, respectively, which we intend to pay with cash generated from our operating activities and other existing or new liquidity sources.

• The revolving credit facility supports our short-term funding needs and also serves to backstop our commercial paper program.

We had no borrowings under the revolving credit facility during the six months ended April 3, 2021.

We had no borrowings under the revolving credit facility during the nine months ended July 3, 2021.

• We expect net interest expense to approximate $420 million for fiscal 2021.

• Our current ratio was 1.7 to 1 at April 3, 2021 and 1.8 to 1 at October 3, 2020.

• At April 3, 2021, approximately $414 million of our cash was held in the accounts of our foreign subsidiaries.

• Our current ratio was 1.5 to 1 at July 3, 2021 and 1.8 to 1 at October 3, 2020.

• At July 3, 2021, approximately $380 million of our cash was held in the accounts of our foreign subsidiaries.

Generally, we do not rely on the foreign cash as a source of funds to support our ongoing domestic liquidity needs.

2 unchanged sentences

We do not expect the regulatory restrictions or taxes on repatriation to have a material effect on our overall liquidity, financial condition or the results of operations for the foreseeable future.

• Subsequent to the third quarter of fiscal 2021, a fire impacted operations at our Hanceville, Alabama rendering facility.

Although we currently do not believe the fire will have a material impact on our consolidated condensed financial statements or our liquidity, we continue to evaluate its impact.

Capital Resources

2 unchanged sentences

We also have a revolving credit facility, with a committed capacity of $1.75 billion, to provide additional liquidity for working capital needs and to backstop our commercial paper program.

Additionally, we have a $500 million committed term loan facility which was fully drawn as of April 3, 2021.

At April 3, 2021, amounts available for borrowing under our revolving credit and term loan facilities totaled $1.75 billion.

Additionally, we have a $500 million committed term loan facility which was fully drawn as of July 3, 2021.

At July 3, 2021, amounts available for borrowing under our revolving credit and term loan facilities totaled $1.75 billion.

Our revolving credit facility is funded by a syndicate of 20 banks, with commitments ranging from $30 million to $204 million per bank.

3 unchanged sentences

The maturities of the notes may vary, but may not exceed 397 days from the date of issuance.

As of April 3, 2021, we had no commercial paper outstanding under this program.

As of July 3, 2021, we had no commercial paper outstanding under this program.

Our ability to access commercial paper in the future may be limited or its costs increased.

2 unchanged sentences

We monitor the ratio of our net debt to EBITDA as support for our long-term financing decisions.

At April 3, 2021, and October 3, 2020, the ratio of our net debt to EBITDA was 2.2x and 2.3x, respectively.

At July 3, 2021, and October 3, 2020, the ratio of our net debt to EBITDA was 1.9x and 2.3x, respectively.

Refer to Part I, Item 3, EBITDA Reconciliations, for an explanation and reconciliation to comparable Generally Accepted Accounting Principles (“GAAP ” ) measures.

27 unchanged sentences

and engage in certain consolidations, mergers and sales of assets.

We were in compliance with all debt covenants at April 3, 2021 and we expect that we will maintain compliance for the foreseeable future.

We were in compliance with all debt covenants at July 3, 2021 and we expect that we will maintain compliance for the foreseeable future.

RECENTLY ISSUED/ADOPTED ACCOUNTING PRONOUNCEMENTS

13 unchanged sentences

Refer to Part I, Item 1, Notes to Consolidated Condensed Financial Statements, Note 1:

Accounting Policies, for updates to our significant accounting policies during the six months ended April 3, 2021.

Accounting Policies, for updates to our significant accounting policies during the nine months ended July 3, 2021.

These critical accounting policies require us to make estimates and assumptions that affect the amounts reported in the consolidated condensed financial statements and accompanying notes.

12 unchanged sentences

Among the factors that may cause actual results and experiences to differ from anticipated results and expectations expressed in such forward-looking statements are the following:

(i) the outbreak of the COVID-19 global pandemic and associated responses has had, and is expected to continue to have, an adverse impact on our business and operations;

(i) the COVID-19 global pandemic and associated responses thereto have had an adverse impact on our business and operations, and the extent that the COVID-19 pandemic continues to impact us will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the scope, severity and duration of the pandemic, the speed and effectiveness of vaccine and treatment developments and their deployment, and public adoption rates of COVID-19 vaccines and their effectiveness against emerging variants of COVID-19, including the Delta variant;

(ii) our ability to make effective acquisitions or joint ventures and successfully integrate newly acquired businesses into existing operations;

28 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis