Cal-Maine Foods, Inc. (NASDAQ: CALM) today reported
results for the fourth quarter and fiscal year ended May
28, 2016.
Net sales for the fourth quarter of fiscal 2016 were $303.0
million, a 24.8 percent decrease compared to $403.0 million for the
fourth quarter of fiscal 2015. The Company reported a net loss of
$376,000, or $0.01 per basic and diluted share, for the fourth
quarter of fiscal 2016, compared to net income of
$46.1 million, or $0.96 per basic share and $0.95 per
diluted share, for the fourth quarter of fiscal 2015.
For the fiscal year 2016, net sales were $1,908.7 million
compared to $1,576.1 million for the prior year. The Company
reported record net income of $316.0 million, or $6.56 per
basic share and $6.53 per diluted share for fiscal 2016,
compared to net income of $161.3 million, or $3.35 per
basic share and $3.33 per diluted share, for fiscal 2015.
Dolph Baker, chairman, president and chief executive officer of
Cal-Maine Foods, Inc., stated, “Cal-Maine Foods had another record
year in fiscal 2016 with sales of $1,908.7 million, surpassing the
previous year’s record by 21.1 percent. Our net income for the year
of $316.0 million was the highest annual net income in the
Company’s history, and was 96.0 percent higher than the record set
in fiscal 2015. Notably, we achieved these results during a period
of unprecedented market conditions for the egg industry.
“Throughout this fiscal year, our industry continued to deal
with the aftermath of the Avian Influenza (AI) outbreaks that
occurred in the spring of 2015. While there have been no positive
tests for AI at any of our locations, the outbreak significantly
affected egg supplies and prices. Our results for the fourth
quarter reflect these extremely volatile egg market conditions and
supply disruptions. Market prices for shell eggs have dropped
considerably from the historically high levels we experienced at
the beginning of this fiscal year. The Urner Barry price index hit
a decade-low level during our fourth quarter, before recovering a
portion of these declines in recent weeks. In addition to the 21.7
percent drop in average selling prices over the same quarter last
year, our sales for the fourth quarter reflect lower volumes,
primarily related to the loss of a portion of a major customer’s
co-pack business. While retail demand trends for shell eggs have
been favorable, the market has continued to experience demand
erosion for egg products and reduced egg exports. Based on USDA
reports, the laying flock is expected to increase through the end
of calendar 2016, creating more supply and the potential for
further price declines.
“In fiscal 2016, we saw steady growth in demand for specialty
eggs with our sales volumes up 14.7 percent for the year,” added
Baker. “Sales of specialty eggs accounted for 22.9 percent of our
total number of shell eggs sold and 29.1 percent of our shell eggs
revenue for fiscal 2016. Specialty egg prices remained strong
during the year; however, as non-specialty egg prices have come
down, we are experiencing some margin and volume pressures on
specialty egg sales. Going forward, we believe Cal-Maine Foods is
well positioned to respond to demand trends for specialty eggs, as
many food service customers, large restaurant chains and major
retailers, including our largest customers, have committed to
exclusive offerings of cage-free eggs by specified future dates. We
are working with our customers to ensure a smooth transition to
meet this demand as a trusted supplier of cage-free eggs. In
addition, our product mix provides a wide variety of healthy
choices for consumers including conventional, nutritionally
enhanced and organic eggs.
“Overall, our operations performed very well in fiscal 2016, as
our managers across all of Cal-Maine Foods’ locations did an
outstanding job in executing our strategy to be an efficient,
low-cost producer. For the year, we reported operating income of
$470.3 million, compared with $235.3 million for the prior year. We
benefited from lower feed and farm production costs during the year
as our feed costs per dozen produced were 5.7 percent lower than
fiscal 2015. These lower costs reflect an abundant supply of grain
from the record harvest of corn and soybean crops last fall.
Looking ahead, current USDA projections for harvested acres and
yields for both crops should ensure an adequate supply of grain for
end users, as long as weather conditions remain favorable through
the summer.”
Baker concluded, “We are very pleased with Cal-Maine Foods’
performance in fiscal 2016 and the consistent execution of our
strategy in a dynamic marketplace. We will remain focused on this
same strategy in the year ahead. We will continue to manage our
operations efficiently and leverage the additional capacity from
our most recent joint ventures and expansion projects. Our
cage-free joint venture with Rose Acre Farms in Texas is on
schedule to reach our full expected capacity in early calendar
2017. In addition, we have a number of major capital projects
underway across our operations, including additional conversions to
further expand our cage-free capacity. We look forward to the new
market opportunities these projects will provide for Cal-Maine
Foods. We will also look for additional markets for specialty eggs
and continue to enhance our product mix in line with customer
demand. Importantly, our strong balance sheet provides us with the
flexibility to pursue acquisitions and additional growth
opportunities that add value to our operations. Together, we
believe these efforts will reward both our customers and
shareholders in fiscal 2017.”
For fiscal 2016, Cal-Maine Foods paid a total of
$105.6 million in dividends, or $2.175 per share, compared
with $53.8 million, or $1.11 per share, in fiscal 2015. Pursuant to
Cal-Maine Foods’ variable dividend policy, in each quarter for
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. No dividends are paid in a quarter for which the
Company does not report net income. Therefore, the Company will not
pay a dividend for the fourth quarter of fiscal 2016.
Selected operating statistics for the fourth quarter and fiscal
2016 compared with the prior-year periods are shown below:
13 Weeks Ended 52
Weeks Ended May 28, 2016 May 30,
2015 May 28, 2016 May 30, 2015
Dozen Eggs Sold (000) 253,077 264,883 1,053,597 1,063,086 Dozen
Eggs Produced (000) 198,950 201,763 819,307 798,842 %
Specialty Sales (dozen)* 23.3 % 21.0 % 22.9 % 19.8 % % Specialty
Sales (dollars)* 40.2 % 28.2 % 29.1 % 27.2 % Net Average Selling
Price (dozen) $ 1.152 $ 1.471 $ 1.735 $ 1.429 Feed Cost (dozen) $
0.396 $ 0.406 $ 0.414 $ 0.439
*Excludes co-pack specialty eggs
Cal-Maine Foods, Inc. is primarily engaged in the production,
grading, packing and sale of fresh shell eggs, including
conventional, cage-free, organic and nutritionally-enhanced eggs.
The Company, which is headquartered in Jackson,
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.
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),
(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 (vi) adverse results in
pending litigation matters. SEC filings may be obtained
from the SEC or the Company’s website, www.calmainefoods.com.
Readers are cautioned not to place undue reliance on
forward-looking statements because, while we
believe the assumptions on which the forward-looking
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, INC. AND
SUBSIDIARIES
FINANCIAL HIGHLIGHTS
(Unaudited)
(In thousands, except per share
amounts)
SUMMARY STATEMENTS OF INCOME
13 Weeks Ended 52
Weeks Ended May 28, 2016 May 30,
2015 May 28, 2016 May 30, 2015 Net
sales $ 303,020 $ 403,011 $ 1,908,650 $ 1,576,128 Gross profit
40,680 109,394 648,074 395,721 Operating income (loss) (1,724 )
66,550 470,314 235,335 Other income 2,792 3,629 16,935 11,214
Income before income taxes and
noncontrolling interest
1,068 70,179 487,249 246,549 Income before income taxes
attributable to Cal-Maine Foods, Inc. 987 70,017 485,243 245,522
Net income (loss) $ (376 ) $ 46,114 $ 316,041 $ 161,254
Net income per share: Basic $ (0.01 ) $ 0.96 $ 6.56 $ 3.35
Diluted $ (0.01 ) $ 0.95 $ 6.53 $ 3.33 Weighted average shares
outstanding Basic 48,247 48,142 48,195
48,136 Diluted 48,247 48,495
48,365 48,437
SUMMARY BALANCE SHEETS
May 28, 2016
May 30,2015
ASSETS Cash and short-term investments $ 389,545 $ 258,628
Receivables 67,448 101,977 Income tax receivable 11,830 -
Inventories 154,799 146,260 Prepaid expenses and other current
assets 2,661 2,099 Current assets 626,283 508,964
Property, plant and equipment (net) 392,274 358,790 Other
noncurrent assets 93,208 60,899 Total assets $
1,111,765 $ 928,653 LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable and accrued expenses $ 67,131 $ 86,193 Current
maturities of long-term debt 16,320 10,065 Income taxes payable
- 5,288 Current liabilities 83,451 101,546
Long-term debt, less current maturities 9,250 40,795 Deferred
income taxes and other liabilities 101,703 81,750 Stockholders'
equity 917,361 704,562 Total liabilities and
stockholders' equity $ 1,111,765 $ 928,653
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version on businesswire.com: http://www.businesswire.com/news/home/20160718005144/en/
Cal-Maine Foods, Inc.Dolph Baker, 601-948-6813Chairman,
President and CEOorTimothy A. Dawson, 601-948-6813Vice President
and CFO
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