Exhibit 99.1
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Contacts:
Sherman Miller, President and CEO
Max P. Bowman, Vice President and CFO
(601) 948-6813
CAL-MAINE FOODS REPORTS RECORD RESULTS
FOR SECOND QUARTER FISCAL 2023
ANNOUNCES QUARTERLY CASH DIVIDEND OF $1.35 PER SHARE
RIDGELAND, Miss. (December 28, 2022) - Cal-Maine Foods, Inc. (NASDAQ: CALM) (“Cal-Maine
Foods”, or the “Company”), the largest producer and distributor of fresh shell eggs in the United
States, today reported results for the second quarter of fiscal 2023 (thirteen weeks) ended
November 28, 2022.
Second Quarter Fiscal 2023 Highlights
●
Record quarterly net sales of $801.7 million, a 110% increase compared with the same
quarter last year, driven by record average conventional egg selling price
●
Record quarterly net income of $198.6 million, or $4.08 per basic and $4.07 per diluted
common share
●
Quarterly gross profit margin of 39.6%
●
Cash dividend of $1.35 per share
Overview
Sherman Miller, chief executive officer of Cal-Maine Foods, commented, “We are proud to
report another strong quarterly financial and operating performance for Cal-Maine Foods, with
record sales and net income for the second quarter of fiscal 2023. These results reflect the current
market environment characterized by record average selling prices for conventional eggs, primarily
due to reduced supply related to the outbreak in the U.S. of highly pathogenic avian influenza
(“HPAI”), and good customer demand. There have been no positive tests for HPAI at any of Cal-
Maine Foods’ owned or contracted production facilities as of December 28, 2022. Consumer
demand for shell eggs continued to be good in the quarter, especially leading up to the Thanksgiving
holiday, and we experienced record quarterly volume levels for specialty eggs sold. As always, we
strive to offer consumers a wide range of quality choices in shell eggs as well as enhanced egg
products offerings. Our ability to meet changing demand trends with a favorable product mix has
been an important differentiator for Cal-Maine Foods. With solid execution, we continued to meet
the needs of our customers.
“We commend our managers and employees across our production facilities who continued
to efficiently manage our operations and keep pace with demand. Our results demonstrate the
strength of our operating model and ability to execute our growth strategy in a dynamic
environment. We believe we are uniquely positioned to leverage our scale to manage various market
cycles and continue to extend our customer reach. Above all, we remain focused on our mission –
to be the most sustainable producer and reliable supplier of fresh shell eggs and egg products in the
United States.”
Cal-Maine Foods Reports Record Results for Second Quarter 2023
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December 28, 2022
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Max Bowman, chief financial officer of Cal-Maine Foods, added, “Our financial results for
the quarter were boosted by a record top line performance of $801.7 million in net sales. Net income
of $198.6 million for the second quarter of fiscal 2023 was another Company record. The
significantly higher selling prices, our enduring focus on cost control, and our ability to adapt to
inflationary market pressures led to improved profitability overall with a gross profit margin of
39.6% for the second quarter of fiscal 2023, another record for Cal-Maine Foods.
“Egg prices have continued to move higher in fiscal 2023 due to the effects of a further
reduction in supply related to the impact of the HPAI outbreak, combined with good customer
demand buoyed in the second quarter of fiscal 2023 by typical seasonal consumer demand.
Conventional egg net average selling price per dozen increased to $2.883 compared with $1.151 a
year ago, and both conventional and specialty egg revenue reached record levels for the second
quarter of fiscal 2023. Net average selling price for specialty eggs rose 24.9% to $2.370 per dozen,
compared with $1.898 per dozen for the second quarter of 2022. We saw our highest ever quarterly
sales of specialty eggs of $227.8 million, or 29.4% of total shell egg revenue. Specialty dozens sold
were 33.8% of total dozens sold compared with 28.7% in the prior-year period.”
13 Weeks Ended
26 Weeks Ended
November 26, 2022
November 27, 2021
November 26, 2022
November 27, 2021
Dozen Eggs Sold (000)
284,086
269,555
559,403
524,174
Conventional Dozen Eggs Sold (000)
187,976
192,135
367,688
376,003
Specialty Dozen Eggs Sold (000)
96,110
77,420
191,715
148,171
Dozen Eggs Produced (000)
261,358
256,786
519,012
493,244
% Specialty Sales (dozen)
33.8
%
28.7
%
34.3
%
28.3
%
% Specialty Sales (dollars)
29.4
%
39.7
%
30.5
%
40.7
%
Net Average Selling Price (per dozen)
$
2.709
$
1.365
$
2.496
$
1.302
Net Average Selling Price Conventional
Eggs (per dozen)
$
2.883
$
1.151
$
2.631
$
1.072
Net Average Selling Price Specialty
Eggs (per dozen)
$
2.370
$
1.898
$
2.236
$
1.885
Feed Cost (per dozen)
$
0.685
$
0.529
$
0.676
$
0.537
Sales Performance & Operating Highlights
Net sales in the second quarter of fiscal 2023 were $801.7 million, compared with
$381.7 million in the second quarter of fiscal 2022. The Company reported net income of $198.6
million, or $4.08 per basic and $4.07 per diluted common share, compared with a net income of
$1.2 million, or $0.02 per basic and diluted common share, in the prior-year period.
For the second quarter of fiscal 2023, total dozens sold increased 5.4% to 284.1 million
versus 269.6 million in the prior-year quarter, driven by strong sales volumes in the specialty eggs
category. Conventional egg volumes sold decreased 2.2% compared with second quarter 2022,
while specialty egg volumes sold increased by 24.1%. This increase in demand for specialty eggs
was positively affected by the higher conventional egg prices as compared to the same period in the
prior year. Conventional egg prices exceeding specialty egg prices has occurred for the past three
quarters but is atypical historically. Demand was further supported by California’s and
Massachusetts’ cage-free mandates going into effect January 1, 2022, as well as more retailers
shifting to selling more cage-free products.
The Company reported operating income of $259.9 million for the second quarter of fiscal
2023 amidst a challenging environment with higher costs across various inputs including feed,
Cal-Maine Foods Reports Record Results for Second Quarter 2023
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December 28, 2022
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labor, packaging, and distribution. Overall, farm production costs per dozen increased 22.0%, or
$0.193, compared with the prior-year period, primarily tied to significantly higher feed costs. For
the second quarter of fiscal 2023, feed costs per dozen were $0.685, a 29.5% increase compared
with the second quarter of fiscal 2022. Supplies of corn and soybean remained tight relative to
demand in the second quarter of fiscal 2023, as evidenced by a low stock-to-use ratio for corn, due
to weather-related shortfalls in production and yields, ongoing disruptions related to the COVID-
19 global pandemic and the Russia-Ukraine war and its impact on the export markets. Additionally,
basis levels for corn ran significantly higher in the Company’s area of operations compared to prior-
year second fiscal quarter, adding to the Company’s expense. For fiscal 2023, the Company expects
continued corn and soybean upward pricing pressures and further market volatility to affect feed
costs.
Product Mix & Cage-Free Eggs
Cal-Maine Foods is committed to sustainably meeting evolving customer needs with a
product mix that aligns with current and expected demand trends. Specialty eggs remain a primary
focus of the Company’s growth strategy.
As market demand for specialty eggs, especially cage-free eggs, has increased, Cal-Maine
Foods has made substantial investments in its production facilities to expand the Company’s cage-
free capacity and distribution capabilities. A significant number of Cal-Maine Foods’ customers
previously announced goals to offer cage-free eggs exclusively on or before 2026, though some of
these customers have extended those timelines to the end of 2030. The Company continues to
monitor the increasing demand for cage-free eggs and to engage with its customers in efforts to
achieve a smooth transition toward their announced timelines for cage-free egg sales. For the
second quarter of 2023, sales of cage-free eggs represented approximately 18.2% of shell egg
revenues versus 22.4% for the same prior year period. Cage-free dozens sold increased 47.4% in
the second quarter of fiscal 2023 as compared to the second quarter of fiscal 2022.
The Company is also focused on additional ways to enhance its product mix and support
new opportunities in the restaurant, institutional and industrial food products arena. On October
4, 2021, Cal-Maine Foods announced a strategic investment of $18.5 million in debt and equity in
Meadow Creek Foods, LLC (“MeadowCreek”) an egg products operation located in Neosho,
Missouri, focused on offering hard-cooked eggs. Cal-Maine Foods serves as the preferred provider
of specialty and conventional eggs for MeadowCreek to manufacture egg products. On December
13, 2022, the Board of Directors approved an additional $13.8 million investment to expand the
Company’s controlling interest and fund additional equipment and working capital needs to
support growth opportunities for MeadowCreek. As demand for hard-cooked eggs has continued
to grow, the funds will be used for additional refrigerated storage space and expanded capacity for
cooking and packaging to better serve MeadowCreek’s customers. Due to delays caused by supply
chain issues and plans for expansion, MeadowCreek is expected to begin operations by or before
March 2023.
Table Egg Supply Outlook
Cal-Maine Foods is closely monitoring the current outbreak of HPAI that was first detected
in commercial flocks in the U.S. in February 2022. Outbreaks in commercial flocks in the U.S. have
Cal-Maine Foods Reports Record Results for Second Quarter 2023
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December 28, 2022
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most recently occurred during each month from September to December 2022. The current HPAI
epidemic has surpassed the prior 2014-2015 outbreak in terms of the number of affected hens in
the U.S., and HPAI continues to circulate throughout the wild bird population in the U.S. and
abroad. According to the U.S. Centers for Disease Control and Prevention, these detections do not
present an immediate public health concern. There have been no positive tests for HPAI at any Cal-
Maine Foods’ owned or contracted production facility as of December 28, 2022. The USDA division
of Animal and Plant Health Inspection Service (“APHIS”) reported on December 27, 2022, that
approximately 43.3 million commercial layer hens and 1.0 million pullets have been depopulated
due to HPAI this year.
The Company believes the HPAI outbreak will continue to exert downward pressure on the
overall supply of eggs, and the duration of these effects will depend in part on the timing of
replenishment of the U.S. layer hen flock. Prior to the outbreak of HPAI in February 2022, the layer
hen flock five-year average from 2017 through 2021 was comprised of approximately 328 million
hens. According to a LEAP Market Analytics report dated December 8, 2022, the layer hen
inventory is not projected to exceed the 328 million mark again until December of 2023. Layer hen
numbers reported by the USDA as of December 1, 2022, were 308 million, which represents a
decrease of 5.8% compared with the layer hen inventory a year ago. However, the USDA also
reported that the hatch from July 2022 through November 2022 increased 5.8% as compared with
the prior-year period. Cal-Maine Foods believes it has been mindful and proactive in implementing
and maintaining robust biosecurity programs across all its locations and facilities. The Company is
working closely with federal, state and local government officials, and focused industry groups to
mitigate the risk of this and future outbreaks, and effectively manage a response, if needed.
ProEgg Cooperative
Cal-Maine Foods has joined in the formation of a new egg farmer cooperative in the western
United States. ProEgg, Inc. (“ProEgg”) is comprised of leading egg production companies,
including Cal-Maine Foods, servicing retail and foodservice shell egg customers in 13 western states.
ProEgg is a producer-owned cooperative organized under the Capper-Volstead Act.
Cal-Maine Foods’ membership in ProEgg is expected to provide benefits for its customers,
including supply chain stability and enhanced reliability. Initially, Cal-Maine Foods’ customer
relationships and customer support are expected to remain the same. At some point in the future,
it is anticipated that each producer member will sell through ProEgg the shell eggs it produces for
sale in the western states covered by the cooperative. Customers would have a single point of contact
for their shell egg purchases, as ProEgg would have a dedicated team to market and sell the
members’ combined egg production in the region.
Miller commented, “Cal-Maine Foods’ top priority in joining as a member of ProEgg is
serving our valued customers in this important market region. During this initial phase, we will
continue our work to confirm that our participation in this new cooperative is in the best interest of
our customers and aligns with our long-term interests. This consideration will take place before
moving to the next phase of membership, and we expect this process to be completed on or before
the end of our fiscal year 2023.”
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December 28, 2022
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Dividend Payment
For second quarter 2023, Cal-Maine Foods will pay a cash dividend of approximately $1.35
per share to holders of its common and Class A common stock. Pursuant to Cal-Maine Foods’
variable dividend policy, for each quarter in 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.
Following a quarter for which the Company does not report net income, the Company will not pay
a dividend with respect to that quarter or for a subsequent profitable quarter until the Company is
profitable on a cumulative basis computed from the date of the most recent quarter for which a
dividend was paid. The amount paid per share will vary based on the number of outstanding shares
on the record date. The dividend is payable on February 9, 2023, to holders of record on January
25, 2023.
About Cal-Maine Foods
Cal-Maine Foods, Inc. is primarily engaged in the production, grading, packing, marketing
and distribution of fresh shell eggs, including conventional, cage-free, organic, brown, free-range,
pasture-raised and nutritionally enhanced eggs. The Company, which is headquartered in
Ridgeland, Mississippi, is the largest producer and distributor of fresh shell eggs in the United
States and sells the majority of its shell eggs in states across the southwestern, southeastern, mid-
western and mid-Atlantic regions of the United States.
Forward Looking Statements
Statements contained in this press release that are not historical facts are forward-looking
statements as that term is defined in the Private Securities Litigation Reform Act of 1995. The
forward-looking statements are based on management’s current intent, belief, expectations,
estimates and projections regarding our company and our industry. These statements are not
guarantees of future performance and involve risks, uncertainties, assumptions and other factors
that are difficult to predict and may be beyond our control. The factors that could cause actual
results to differ materially from those projected in the forward-looking statements include, among
others, (i) the risk factors set forth in the Company’s SEC filings (including its Annual Reports on
Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K), (ii) the risks and
hazards inherent in the shell egg business (including disease, pests, weather conditions and
potential for recall), including but not limited to the most recent outbreak of highly pathogenic
avian influenza affecting poultry in the U.S., Canada and other countries that was first detected
in commercial flocks in the U.S. in February 2022, (iii) changes in the demand for and market
prices of shell eggs and feed costs, (iv) our ability to predict and meet demand for cage-free and
other specialty eggs, (v) risks, changes or obligations that could result from our future acquisition
of new flocks or businesses and risks or changes that may cause conditions to completing a
pending acquisition not to be met, (vi) risks relating to the evolving COVID-19 pandemic,
including without limitation increased costs, rising inflation and interest rates, which generally
have been exacerbated by Russia’s invasion of Ukraine starting in February 2022, (vii) our ability
to retain existing customers, acquire new customers and grow our product mix and (viii) adverse
results in pending litigation matters. SEC filings may be obtained from the SEC or the Company’s
website
,
looking statements because, while we believe the assumptions on which the forward-looking
Cal-Maine Foods Reports Record Results for Second Quarter 2023
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December 28, 2022
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statements are based are reasonable, there can be no assurance that these forward-looking
statements will prove to be accurate. Further, the forward-looking statements included herein are
only made as of the respective dates thereof, or if no date is stated, as of the date hereof. Except as
otherwise required by law, we disclaim any intent or obligation to publicly update these forward-
looking statements, whether as a result of new information, future events or otherwise.
Cal-Maine Foods Reports Record Results for Second Quarter 2023
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December 28, 2022
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CAL-MAINE FOODS, INC. AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS
(Unaudited)
(In thousands, except per share amounts)
SUMMARY STATEMENTS OF OPERATIONS
13 Weeks Ended
26 Weeks Ended
November 26, 2022
November 27, 2021
November 26, 2022
November 27, 2021
Net sales
$
801,700
$
381,723
$
1,460,044
$
706,709
Cost of sales
483,851
337,976
924,705
656,317
Gross profit
317,849
43,747
535,339
50,392
Selling, general and administrative
57,952
47,780
111,559
94,305
(Gain) loss on disposal of fixed assets
29
(1,968)
62
(2,181)
Operating income (loss)
259,868
(2,065)
423,718
(41,732)
Other income, net
2,400
2,533
4,030
8,336
Income (loss) before income taxes
262,268
468
427,748
(33,396)
Income tax expense (benefit)
63,974
(677)
104,320
(16,515)
Net income (loss)
198,294
1,145
323,428
(16,881)
Less: Loss attributable to noncontrolling
interest
(293)
(28)
(446)
(28)
Net income (loss) attributable to Cal-
Maine Foods, Inc.
$
198,587
$
1,173
$
323,874
$
(16,853)
Net income (loss) per common share:
Basic
$
4.08
$
0.02
$
6.66
$
(0.34)
Diluted
$
4.07
$
0.02
$
6.63
$
(0.34)
Weighted average shares outstanding:
Basic
48,624
48,857
48,624
48,859
Diluted
48,840
49,016
48,827
48,859
Cal-Maine Foods Reports Record Results for Second Quarter 2023
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December 28, 2022
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CAL-MAINE FOODS, INC. AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS
(Unaudited)
(In thousands)
SUMMARY BALANCE SHEETS
November 26, 2022
May 28, 2022
ASSETS
Cash and short-term investments
$
379,349
$
174,513
Receivables, net
305,111
219,404
Inventories, net
280,582
263,316
Prepaid expenses and other current assets
8,968
4,286
Current assets
974,010
661,519
Property, plant and equipment, net
703,882
677,796
Other noncurrent assets
85,548
88,174
Total assets
$
1,763,440
$
1,427,489
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable and accrued expenses
$
240,347
$
148,018
Dividends payable
66,202
36,656
Current liabilities
306,549
184,674
Deferred income taxes and other liabilities
136,586
138,470
Stockholders' equity
1,320,305
1,104,345
Total liabilities and stockholders' equity
$
1,763,440
$
1,427,489