Home » NEWS » Agribusiness » Cal-Maine records $26.1 million loss for quarter after settlement

Cal-Maine records $26.1 million loss for quarter after settlement

By JACK WEATHERLY

Cal-Maine Foods suffered a net loss of $26.1 million, or 54 cents per share, for the second fiscal quarter of 2018 in which the Jackson-based egg producer recorded a $52.8 million after-tax antitrust settlement.

The settlement stems from a Sept. 25, 2008 consolidated suit case filed in the U.S. District Court for the Eastern District of Pennsylvania.

Excluding the settlement, the company recorded net income of $26.6 million, or 22 cents per share.

“While we deny any liability in these cases and still believe that our conduct has always been lawful, we decided that it was in the best interests of our shareholders, customers and employees to settle these long-standing cases at this time,” Dolph Baker, chairman, president and chief executive said in a release.

It was not the first such settlement for the company reached a $17 million antitrust agreement in the fourth quarter of fiscal 2013.

For the quarter that ended Dec. 2, Baker said, the company otherwise “had a solid operating performance during the quarter.”

Net sales for the quarter were $361.2 million, a 42 percent increase over the second quarter of fiscal 2017, the company said in the release.

The second quarter of fiscal 2017 didn’t fare much better, for a different reason.

Cal-Maine, the largest producer of shell eggs in the United States, continued to deal with the ripples caused by the avian influenza that devastated the industry in the Midwest and curtailed demand. That meant a net loss of $23 million, or 48 cents per share for Cal-Maine.

Baker noted in the latest report that “market prices for conventional shell eggs conventional to move higher throughout the quarter, with our customer selling prices for all eggs and conventional eggs up 36 percent and 77.6 percent, respectively.”

He noted that President Donald Trump’s signing on Dec. 22 of the Tax Cuts and Jobs Act, which will lower the corporate income tax to 21 percent from 35 percent, will reduce the company’s current deferred tax liability of $75.3 million in the third quarter.

Shares of Cal-Maine closed at $40.80 on Friday, when earnings were released before the NasdaqGS market opened, a $1.05 drop.

The market liked Cal-Maine shares on Monday, which closed at $43.45, up $2.85. Their 52-week range is $33.40 to $50.40.

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