US: Cal-Maine posts improved H1 sales, profits

By Katy Askew | 2 January 2014

Cal-Maine drives growth with speciality focus

Cal-Maine drives growth with speciality focus

US egg producer Cal-Maine Foods booked an increase in first-half sales and operating performance, benefiting from its increased focus on speciality egg sales.

For the first six months of fiscal 2014, net sales were US$673.8m compared with net sales of $601.8m in the year-ago period. Net income totalled $34.9m in the six months, compared with net income of $23.7m in the first half of last year.

Commenting on the result, chairman, president and CEO Dolph Baker said the group was increasing its focus on speciality products.

"Speciality eggs are an important area of focus for Cal-Maine Food's growth strategy as they continue to gain popularity with consumers who are looking for alternatives and willing to pay for premium products. Specialty egg prices, which are typically higher and less cyclical than regular egg prices, were up 4.1% in the second quarter of fiscal 2014 compared with the same period last year. We will continue to identify ways to enhance our product mix in line with changing customer demand trends."

Speciality egg sales accounted for 16.4% of sales volumes and 23.7% of revenue in the second quarter, the group revealed.

Show the press release
Cal-Maine Foods, Inc. Reports Second Quarter Fiscal 2014 Results

JACKSON, Miss.--(BUSINESS WIRE)--Dec. 30, 2013-- Cal-Maine Foods, Inc. (NASDAQ: CALM) today announced results for the second quarter and six months ended November 30, 2013.

Net sales for the second quarter of fiscal 2014 were $354.3 million, an eight percent increase compared with net sales of $328.9 million for the second quarter of fiscal 2013. The Company reported net income of $26.1 million, or $1.09 per basic share and $1.08 per diluted share, for the second quarter of fiscal 2014 compared with $14.3 million, or $0.60 per basic and diluted share, for the second quarter of fiscal 2013.

For the first six months of fiscal 2014, net sales were $673.8 million compared with net sales of $601.8 millionfor the prior-year period. The Company reported net income of $34.9 million, or $1.45 per basic share and$1.44 per diluted share, for the first half of fiscal 2014 compared with net income of $23.7 million, or $0.99 per basic and diluted share, for the year-earlier period.

Dolph Baker, chairman, president and chief executive officer of Cal-Maine Foods, Inc., stated, “We are pleased with the continued growth in sales and improved operating performance for the second quarter of fiscal 2014. These results reflect the additional volumes related to the Maxim acquisition, completed in November 2012, which contributed to the 6.2 percent growth in dozens sold during the quarter. Average selling prices were up one percent compared with the second quarter of fiscal 2013.

“Our specialty egg sales continued to trend higher and accounted for 16.4 percent of dozens sold and 23.7 percent of total shell egg sales revenue for the quarter. Specialty eggs are an important area of focus for Cal-Maine Food’s growth strategy as they continue to gain popularity with consumers who are looking for alternatives and willing to pay for premium products. Specialty egg prices, which are typically higher and less cyclical than regular egg prices, were up 4.1 percent in the second quarter of fiscal 2014 compared with the same period last year. We will continue to identify ways to enhance our product mix in line with changing customer demand trends.”

Baker added, “We experienced favorable egg markets during the second quarter of fiscal 2014. Our feed costs, which remain at historically high levels, were 15 percent lower than a year ago. We are optimistic feed costs will remain near current levels, but believe that prices of corn and soybean meal, our principal feed ingredients, will remain volatile for the balance of our fiscal year. Overall, our operations performed very well and our operating income for the second quarter of fiscal 2014 was $40.9 million compared with $20.4 millionfor the second quarter of fiscal 2013. These results reflect higher sales volumes and our continued efforts to be an efficient, low-cost producer. We are very pleased with our performance through the first half of fiscal 2014 and look forward to the new opportunities ahead for Cal-Maine Foods.”

For the second quarter of fiscal 2014, Cal-Maine Foods will pay a cash dividend of approximately $0.361 per share to holders of its common and Class A common stock. Pursuant to Cal-Maine Foods’ variable dividend policy, in each quarter for which the Company reports net income, the Company pays a cash dividend to shareholders in an amount equal to one-third of such quarterly income. No dividends are paid in a quarter for which the Company does not report net income. The amount paid could vary slightly based on the amount of outstanding shares on the record date. The dividend is payable February 3, 2014, to shareholders of record on January 29, 2014.

Selected operating statistics for the second quarter and year to date periods of fiscal 2014 compared with the prior year periods are shown below:

         
    13 Weeks Ended   26 Weeks Ended
   

November 30,
2013

 

December 1,
2012

 

November 30,
2013

 

December 1,
2012

Dozen Eggs Sold (000)     252,766       238,064       495,315       448,125  
Dozen Eggs Produced (000)     185,538       179,849       365,265       337,751  
                 
% Specialty Sales (dozen)     16.4 %     16.4 %     16.3 %     16.2 %
                 
Net Average Selling Price (dozen)   $ 1.340     $ 1.323     $ 1.297     $ 1.283  
Feed Cost (dozen)   $ 0.486     $ 0.574     $ 0.512     $ 0.547  
                 
% Specialty Sales Dollars     23.7 %     22.9 %     24.1 %     23.2 %
                                 

On November 15, 2012, the Company purchased the commercial egg assets of Maxim Production Co., Inc.Excluding the acquisition, net sales for the second quarter of fiscal 2014 were $323.4 million, an increase of 1.6 percent compared with the prior-year period. Dozens sold, excluding the acquisition, were 227.0 million for the second quarter of fiscal 2014, a decrease of 1.3 percent compared with the second quarter of fiscal 2013. On a comparable basis, excluding the acquisition, net sales for the first half of fiscal 2014 were $615.0 million, an increase of 4.0 percent, and dozens sold were 445.2 million, an increase of 1.2 percent, over the same period last year.

Original source: Cal-Maine Foods

Sectors: Financials, Fresh produce

Companies: Cal-Maine Foods

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