Cal-Maine Foods reports record first-quarter profit as egg prices stay high
Strong demand for specialty eggs and new prepared foods unit lift sales and income
USA – Cal-Maine Foods Inc. is reporting its highest-ever first-quarter results as strong egg prices and its growing prepared foods business continue to drive revenue.
The company’s net income for the quarter ended August 30 rose 32.9% to US$199.3 million from US$150 million a year earlier, while earnings per share increased to US$4.12 from US$3.06.
Net sales climbed 17.4% to US$922.6 million compared with US$785.9 million in the same period last year, and operating income grew by a third to reach US$249.2 million.
President and chief executive officer Sherman Miller said during an October 1 earnings call that the strong results reflect the company’s operational progress and diversification efforts.
He added that Cal-Maine’s performance highlights growth in specialty eggs and the expansion of its prepared foods category, which together now account for nearly 40% of total sales.
The company said total shell egg sales increased by 6.5% to US$789.4 million, supported by a 2.5% rise in sales volume and a 3.9% gain in average selling prices.
According to chief financial officer Max Bowman, shell eggs made up 85.6% of overall sales, down from the same period last year as prepared foods became a larger contributor.
Prepared Foods Expansion
Cal-Maine’s move into prepared foods follows its June acquisition of Echo Lake Foods, a Wisconsin-based producer of ready-to-eat egg and breakfast items such as omelets, pancakes, and waffles.
Prepared foods generated US$83.9 million in sales in the first quarter, a jump of more than 800%, with Echo Lake accounting for US$70.5 million of that figure.
Bowman said prepared foods represented just over 9% of Cal-Maine’s total revenue this quarter, illustrating a shift toward higher-value categories.
Conventional egg sales rose 4.4% to US$505.9 million, driven mainly by higher prices, while specialty egg sales grew 10.4% to US$283.5 million due to stronger demand and modest price increases.
The company reported that specialty eggs now represent 35.9% of total shell egg revenue, up from last year, while egg product sales edged up 4.1% to US$37.1 million.
Managing Production and Health Risks
Cal-Maine said the national egg-laying flock remains smaller than usual as the sector continues to recover from highly pathogenic avian influenza outbreaks.
The company expanded its breeder flocks by 46% during the quarter and increased chick hatching by 77%, resulting in a 10% growth in the average number of laying hens.
Miller noted that despite these gains, the risk of avian influenza persists both in the United States and globally, posing ongoing challenges for the poultry industry.
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