Ahead Of Cal-Maine Foods' Q2 Results

(RTTNews) - Cal-Maine Foods Inc. (CALM) has been pursuing a growth strategy focused on the acquisition of existing shell egg production and processing facilities, as well as the construction of new and more efficient facilities. Since the beginning of fiscal 1989, the company has completed eighteen acquisitions.

As a result of its strategy, Cal-Maine's total flock, including pullets, layers and breeders, increased from about 33.0 million at May 29, 2010 to about 42.1 million as of May 30, 2015. The dozens of shell eggs sold increased from about 805.4 million in fiscal 2010 to about 1,063.1 million for fiscal 2015.

The company is primarily engaged in the production, grading, packing and sale of fresh shell eggs, including conventional, cage-free, organic and nutritionally-enhanced eggs. Headquartered in Jackson, Mississippi, Cal-Maine is the largest producer and distributor of fresh shell eggs in the United States with fiscal 2015 sales of about 1.063 billion dozen shell eggs, representing about 23% of domestic shell egg consumption in the United States.

With a full complement of conventional, nutritionally enhanced, cage-free and organic eggs, the company said it is well positioned to capitalize on additional opportunities to market and sell specialty eggs in fiscal 2016.

In spite of the market disruptions, demand trends for eggs from the retail and egg products markets have been favorable throughout the first quarter. Cal-Maine continues to see strong consumer demand for specialty eggs, and remains focused on providing customers with a product mix that meets this demand.

Cal-Maine's second-quarter number are due to be released after the bell on Wednesday, December 23, with analysts polled by Thomson Reuters estimating earnings of $2.40 per share on revenue of $552.31 million. Analysts' estimate typically exclude certain special items.

In the last quarter, the company reported net income of $143.0 million or $2.95 per share compared to $27.7 million or $0.57 per share for the first quarter of fiscal 2015. Analysts expected earnings of $3.14 per share for the first quarter.

Net sales were $609.9 million compared to $356.9 million in the prior year period.

For the first quarter, specialty egg sales, including those sold through co-pack arrangements, accounted for 24.5% of the company's total number of shell eggs sold and 27.1% of its shell eggs revenue.

Dolph Baker, chairman, president and chief executive officer of Cal-Maine Foods, said, "Our financial and operating results for the first quarter marked a very strong start to fiscal 2016 with record quarterly sales and net income. Overall sales were up 70.9 percent over the prior year period, as average selling prices for shell eggs spiked to record levels during the first quarter and were up 65.7 percent compared with the same period last year. Volumes were also up slightly in what is typically our slowest quarter, with total dozen shell eggs sold up 2.8 percent over the first quarter of fiscal 2015."