By Nathalie Voit

U.S. meatpacking giant Tyson Foods released its impressive financial results for the first quarter of 2022 on Feb. 7, sending shares surging over 11% yesterday to reach an all-time high of $100.72 on Tuesday.

The significant investor attention came as Tyson, the world’s second-largest frozen and refrigerated food manufacturer, announced it nearly doubled profits from the first quarter due to higher U.S. meat prices.

Tyson said the higher prices were driven by surging demand for its beef, chicken, and pork products.

“Customer demand continues to outpace our ability to supply product,” President and CEO of Tyson Foods Donnie King said in the company’s earnings call. “Our retail core business lines, which include our iconic brands, Tyson, Jimmy Dean, Hillshire Farm, and Ball Park maintain their volume share position even as we work through price increases to address inflationary pressure.”

According to the company’s first-quarter results ending on Jan. 1, the average cost of Tyson’s beef rose 31.7% year-over-year. The company’s chicken prices soared 19.9%, followed by a 12.8% increase in the price of Tyson’s pork over the year. The results come together to bring the average inflation rate for all of Tyson’s products to 19.6%.

Meanwhile, sales for beef jumped about 25% to $5 billion in the first quarter, bringing Tyson’s total sales to $12.93 billion in Q1, an increase of 24% from last year. Analysts surveyed by Refinitiv projected revenue of $12.18 billion, according to CNBC.

Operating margins for the beef segment climbed from 13.2% to 19.1%. According to the results, the company reported an average adjusted operating income of $1.43 billion, up 40% from the prior year.

Tyson’s net income rose from $467 million to $1.12 billion. The Arkansas-based company earned an adjusted net income per share of $2.87, higher than the $1.95 per share predicted by analysts and up nearly 50% from one year ago, the company said.

Tyson claimed the price increases were instituted to offset inflation of materials, labor, and transportation costs.

“In the quarter, our cost of goods sold was up 18% relative to the same period last year. We are seeing higher costs across our supply chain, including higher input costs, such as feed and ingredients,” King said. “With these higher costs, we work closely with our customers to achieve a fair value for our products. As a result, our average sales price for the quarter increased 19.6% relative to the same period last year. This helped us capture some of the unrecovered costs due to the timing lag between inflation and price.”

The news arrives as the White House looks to potentially break up the U.S. meat and poultry processing sector, which has been criticized for its lack of competition.

The Biden administration said that just four large meatpacking firms control 85% of the beef market.