Cal-Maine Foods, Inc. (NASDAQ: CALM) today reported
results for the third quarter and nine months ended
February 27, 2016.
Net sales for the third quarter of fiscal 2016 were $449.8
million, a 2.8 percent increase compared to $437.6 million for the
third quarter of fiscal 2015. The Company reported net income of
$64.2 million, or $1.33 per basic and diluted share, for the third
quarter of fiscal 2016 compared to $50.9 million,
or $1.06 per basic share and $1.05 per diluted share, for the
third quarter of fiscal 2015.
For the first nine months of fiscal 2016, net sales were
$1,605.6 million compared to $1,173.1 million for the prior-year
period. The Company reported net income of $316.4 million, or
$6.57 per basic share and $6.54 per diluted share, for
the first nine months of fiscal 2016 compared to net income of
$115.1 million, or $2.39 per basic share and $2.38 per
diluted share, for the year-earlier period.
Dolph Baker, chairman, president and chief executive officer of
Cal-Maine Foods, Inc., stated, “Cal-Maine Foods delivered another
solid performance for the third quarter of fiscal 2016,
demonstrating consistent execution of our strategy in changing
market conditions. Our sales were up 2.8 percent for the third
quarter and up 36.9 percent for the first nine months of fiscal
2016. These increases primarily reflect higher average selling
prices compared with the same periods last year. While average
selling prices for shell eggs for the third quarter of fiscal 2016
have dropped considerably from the historically high record levels
we experienced earlier in the fiscal year, they were still up 4.3
percent over the third quarter of fiscal 2015. For the fiscal
year-to-date period, average selling prices were up 35.6 percent
over the same period a year ago. Our sales volumes have continued
to trend higher each quarter of fiscal 2016; however, they were
down 1.9 percent in the third quarter compared with the prior-year
period.
“Our industry continues to deal with the reduced hen supply and
other market disruptions caused by the Avian Influenza (AI)
outbreaks in the upper Midwestern United States during the spring
of 2015. While the supply has been steadily moving back up, the
current national laying hen flock recently reported by the USDA is
still approximately 3.0 percent lower than it was a year ago.
Industry-wide, retail demand trends for shell eggs have been
favorable in spite of the supply disruptions; however, egg prices
have been negatively affected by increased egg supplies due to
demand erosion for egg products, increased egg imports and reduced
egg exports. Egg inventories have continued to build, and we expect
market prices will remain volatile until the industry has more
clarity on future supply levels.
“We continue to diligently monitor the situation related to AI,
and we are working with egg industry associations and government
officials to identify ways to mitigate the risk of future
outbreaks. There have been no positive tests for AI at any of the
Cal-Maine Foods locations; however, we have strengthened our
biosecurity measures at all of our facilities. Importantly, we are
very focused on our customers, and we continue to make the
necessary adjustments to ensure their needs are met following the
recent market disruptions.
“Specialty eggs have been a key driver of our growth throughout
this fiscal year, with volumes up 13.7 percent for the third
quarter compared with the prior-year period,” added Baker.
“Specialty egg sales accounted for 23.6 percent of the dozens of
shell eggs sold and 31.0 percent of total shell egg sales revenue
for the third quarter of fiscal 2016, compared with 20.3 percent of
the dozens of shell eggs sold and 26.9 percent of total shell egg
sales revenue for the third quarter of fiscal 2015. We continue to
pursue additional opportunities to market and sell specialty eggs,
especially in light of changing demand trends. As the food service
industry, restaurant chains and major retailers are increasingly
demanding more cage-free eggs in response to market forces, we are
working with our customers to facilitate a smooth transition to
meet this demand. We believe Cal-Maine Foods is well positioned to
respond to dynamic market conditions and future demand trends. In
addition to cage-free eggs, we provide our customers with a full
selection of conventional, nutritionally enhanced and organic eggs,
and we will continue to enhance our product mix to meet the needs
of our customers.
“Overall, our operations continued to perform very well in the
third quarter with more favorable market conditions than we
experienced a year ago. Operating income for the third quarter of
fiscal 2016 was $85.8 million, up 19.2 percent compared with $72.0
million for the third quarter of fiscal 2015. These results reflect
lower feed and farm production costs and consistent execution of
our strategy to be an efficient, low-cost producer across all of
the Company’s operations. Our feed costs per dozen produced were
5.0 percent lower than the third quarter of fiscal 2015 and 6.7
percent lower through the first nine months of this fiscal year.
These lower costs reflect more plentiful grain supplies as a result
of near record corn and soybean crops harvested in the United
States last fall. Looking ahead, industry consultants are
projecting increased planting acreage for both corn and soybeans.
With favorable weather conditions during this year’s growing
season, we should continue to have an adequate feed supply.”
Baker added, “We are pleased with the continued progress with
respect to our joint venture with Rose Acre Farms in Texas. This
important joint venture has allowed us to significantly expand our
production of cage-free eggs while sharing the costs and risks with
an experienced partner. As planned, our initial flock was placed in
early November, and we are on schedule for continued placements
until we reach our full expected capacity in early calendar 2017.
In addition, we have a number of major capital projects underway
across our operations to further expand our cage-free capacity to
meet expected customer demand and reduce our dependence on spot
market purchases. We look forward to the new market opportunities
these projects will provide for Cal-Maine Foods.”
For the third quarter of fiscal 2016, Cal-Maine Foods will pay a
cash dividend of approximately $0.441 per share to holders of its
common and Class A common stock. 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. The amount paid could
vary slightly based on the amount of outstanding
shares on the record date. The dividend is payable May
12, 2016, to shareholders of record on April 27, 2016.
Selected operating statistics for the third quarter and
year-to-date periods of fiscal 2016 compared with the prior-year
periods are shown below:
13 Weeks Ended 39 Weeks
Ended
February 27,
2016
February 28,
2015
February 27,
2016
February 28,
2015
Dozen Eggs Sold (000) 277,574 283,032 800,520 798,203 Dozen Eggs
Produced (000) 213,285 203,581 620,356 597,080 % Specialty
Sales (dozen) 23.6 % 20.3 % 22.8 % 19.4 % % Specialty Sales
(dollars) 31.0 % 26.9 % 27.0 % 26.8 % Net Average Selling Price
(dozen) $ 1.568 $ 1.503 $ 1.919 $ 1.415 Feed Cost (dozen) $ 0.414 $
0.436 $ 0.420 $ 0.450
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) risks, changes or obligations that could
result from our future acquisition of new flocks or
businesses, and (v) 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 update publicly these forward-looking
statements, whether as a result of new information, future
events or otherwise.
CAL-MAINE FOODS, INC. AND
SUBSIDIARIES FINANCIAL HIGHLIGHTS SUMMARY
STATEMENTS OF INCOME
(Unaudited)
(In thousands, except per share
amounts)
13 Weeks Ended 39 Weeks Ended
February 27,
2016
February 28,
2015
February 27,
2016
February 28,
2015
Net sales $ 449,760 $ 437,556 $ 1,605,630 $ 1,173,117 Gross profit
132,726 112,517 607,394 286,327 Operating income 85,771 72,025
472,038 168,785 Other income 11,744 5,049 14,143 7,585 Income
before income taxes and noncontrolling interest 97,515 77,074
486,181 176,370 Income before income taxes attributable to
Cal-Maine Foods, Inc. 97,337 76,997 484,256 175,505 Net
income $ 64,164 $ 50,882 $ 316,417 $ 115,140 Net income per
share: Basic $ 1.33 $ 1.06 $ 6.57 $ 2.39 Diluted $ 1.33 $ 1.05 $
6.54 $ 2.38
Weighted average shares outstanding:
Basic 48,204 48,137 48,177 48,134
Diluted 48,367 48,447 48,359 48,416
SUMMARY BALANCE SHEETS
February 27,
2016
May 30,
2015
ASSETS Cash and short-term investments $ 387,049 $ 258,628
Receivables 110,765 101,977 Inventories 154,165 146,260 Prepaid
expenses and other current assets 2,289 2,099 Current
assets 654,268 508,964 Property, plant and equipment (net)
382,271 358,790 Other noncurrent assets 87,693 60,899
Total assets $ 1,124,232 $ 928,653 LIABILITIES AND
STOCKHOLDERS' EQUITY Accounts payable and accrued expenses $ 91,726
$ 86,193 Current maturities of long-term debt 6,159 10,065 Income
tax payable 7,946 5,288 Deferred income taxes 21,796
30,391 Current liabilities 127,627 131,937 Long-term debt,
less current maturities 21,081 40,795 Deferred income taxes and
other liabilities 59,508 51,359 Stockholders' equity 916,016
704,562 Total liabilities and stockholders' equity $
1,124,232 $ 928,653
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version on businesswire.com: http://www.businesswire.com/news/home/20160328005150/en/
Cal-Maine Foods, Inc.Dolph Baker, Chairman, President and
CEOorTimothy A. Dawson, Vice President and CFO601-948-6813
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