Market conditions hinder earnings for Cal-Maine

by Staff
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JACKSON, MISS. — Growing demand for specialty eggs benefitted Cal-Maine Foods, Inc., which reported a 17% growth in net sales during the first quarter of fiscal 2014.

Nutritionally enhanced, cage-free and organic eggs, marketed under Egg-Land’s Best, Farmhouse and 4-Grain brands, accounted for 15% of dozens sold and 25% of total shell egg sales for the quarter with an average selling price that was up 5.5% over the first quarter last year. But while higher volumes and higher average selling prices boosted the company’s revenue during the quarter, earnings declined on higher production costs and grain prices.

For the quarter ended Aug. 31, the company had net income of $8,756,000, equal to 36c per share on the common stock, which compared with $9,415,000, or 39c per share, during the same period of the prior year. Net sales climbed to $319,528,000 during the quarter, up from $272,928,000 during the first quarter a year ago.

“Market prices for grain have remained high through the first quarter and our feed costs were up 3.4c per dozen, or 6.7%, compared with the same period last year,” said Dolph Baker, chairman, president and chief executive officer. “However, we are encouraged by the favorable growing conditions this summer, which have improved the yield of this year’s corn and soybean crops. As a result, prices have already come down from the previous high levels and we expect to incur lower feed costs for the remainder of fiscal 2014. Regardless of market conditions, we remain focused on managing our operations efficiently and meeting the needs of our customers. We believe we have the right growth strategy in place and look forward to the opportunities ahead for Cal-Maine Foods in fiscal 2014.”
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