Cal-Maine Foods Q2 2023 Earnings Report
Key Takeaways
Cal-Maine Foods reported record net sales of $801.7 million and net income of $198.6 million for the second quarter of fiscal 2023. The results were driven by record average selling prices for conventional eggs due to reduced supply related to the outbreak of highly pathogenic avian influenza (HPAI) and good customer demand.
Record quarterly net sales of $801.7 million, a 110% increase compared with the same quarter last year.
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 was announced.
Cal-Maine Foods
Cal-Maine Foods
Cal-Maine Foods Revenue by Segment
Forward Guidance
The Company expects continued corn and soybean upward pricing pressures and further market volatility to affect feed costs. 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.
Positive Outlook
- The USDA 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.
- Cal-Maine Foods’ membership in ProEgg is expected to provide benefits for its customers, including supply chain stability and enhanced reliability.
- Cal-Maine Foods serves as the preferred provider of specialty and conventional eggs for MeadowCreek to manufacture egg products.
Challenges Ahead
- For fiscal 2023, the Company expects continued corn and soybean upward pricing pressures and further market volatility to affect feed costs.
- The Company believes the HPAI outbreak will continue to exert downward pressure on the overall supply of eggs.
- The duration of these effects will depend in part on the timing of replenishment of the U.S. layer hen flock.
- 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.
- Due to delays caused by supply chain issues and plans for expansion, MeadowCreek is expected to begin operations by or before March 2023.