On Sept. 28 before the market opened, Cal-Maine Foods Inc. (CALM, Financial), the U.S.'s largest egg producer, released earnings results for its first quarter of fiscal 2021.
Key highlights
Cal-Maine reported diluted loss per share of $0.40 in the first quarter, which reflected a growth from a loss per share of 94 cents recorded in the prior-year quarter. Revenue of $292.8 million was up 21.4% on a year-over-year basis.
Reflecting on the latest quarter, Chairman and CEO Dolph Baker said:
"Market prices for eggs remained volatile over the first quarter and decreased overall compared to prices at the end of fiscal 2020, which reflected increased consumer purchases due to the COVID-19 pandemic and seasonal demand due to Easter falling in the fourth quarter. The Southeast large market average price for conventional eggs for the first quarter of 2021 was $0.95 per dozen, up 13.1 percent compared to $0.84 for the first quarter of fiscal 2020. Our average sales price was up 17.8 percent compared with the prior year first quarter, which was a period of record low prices and an oversupply of eggs."
For the quarter, the company sold 263.1 million dozen eggs, which was more than the prior-year quarter. Additionally, the net average selling price was up from the prior-year period at $1.078 per dozen. Baker summarized the key points of the results:
"For the first quarter of fiscal 2021, sales of specialty eggs totaled $129.2 million, accounting for 45.2 percent of our egg sales revenue, compared with $111.2 million, or 47.5 percent of egg sales revenue, in the first quarter of fiscal 2020. The higher specialty egg revenue reflects a 15.5 percent increase in specialty dozens sold and a $0.011 increase in net average selling price per dozen in the first quarter of fiscal 2021 as compared to the same period in fiscal 2020. Demand for specialty eggs was positively affected by the higher conventional egg prices as compared to the same period in the prior year."
Looking forward
Baker said that the company would continue to implement its "growth strategy" in fiscal 2021 in spite of challenges posed by the coronavirus pandemic. The growth strategy comprises of providing a favorable product mix, investing in operations and discovering acquisitions and other growth opportunities that would augment its production. Baker described it as follows:
"We will continue to pursue our growth strategy and the further expansion of our specialty egg business as we work to safely meet the needs of our customers with outstanding products and service. We look forward to the opportunities ahead for Cal-Maine Foods in fiscal 2021."
Due to the supply chain disruptions caused by the coronavirus pandemic as well as the uncertainties associated with trade agreements and tariff disputes, price volatility is expected throughout the fiscal year.
The company did not issue any guidance figures for earnings and revenue.
Disclosure: I do not hold any positions in the stocks mentioned.
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