Cal-Maine Profit Climbs 26%
March 28 2016 - 9:30AM
Dow Jones News
Cal-Maine Foods Inc. said profit climbed 26% in the latest
quarter, easily topping Wall Street expectations, as the egg
producer again benefited from higher egg prices.
The company's stock, up 28% in the past 12 months through
Thursday's close, climbed 7.1% to $53.72 in premarket trading.
Cal-Maine has seen higher egg prices in recent quarters
following a reduction in the number of hens last spring because of
an outbreak of avian flu that routed some competitors' flocks.
However, the company has had to spend more on monitoring to guard
against its chickens getting the bird flu.
Cal-Maine said Monday that there have been no positive tests for
bird flu at any of its locations.
Chairman and Chief Executive Dolph Baker said prices dropped
considerably in the third quarter compared with earlier in its
fiscal year, though they still were up 4.3% to $1.57 a dozen from
$1.50 in the prior-year quarter.
While supply has been increasing, Mr. Baker noted that the
current national laying hen flock recently reported by the USDA is
still about 3% lower than it was a year ago.
"Egg inventories have continued to build, and we expect market
prices will remain volatile until the industry has more clarity on
future supply levels," he said.
Over all, Cal-Maine posted a profit of $64.2 million, or $1.33 a
share, up from $50.9 million, or $1.05 a share, a year ago. Sales
climbed 2.8% to $449.8 million.
Analysts surveyed by Thomson Reuters had expected 99 cents a
share on $464 million in sales.
Specialty eggs continued to make up a larger chunk of
Cal-Maine's business, representing 23.6% of egg sales compared with
20.3% in the year-earlier period.
Write to Joshua Jamerson at joshua.jamerson@wsj.com
(END) Dow Jones Newswires
March 28, 2016 09:15 ET (13:15 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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