Cal-Maine Foods posts profit, slim rise in revenue
Published: September 27,2010
JACKSON — Cal-Maine Foods Inc., the nation’s biggest egg seller and distributor, returned to profitability in its fiscal first-quarter.
Cal-Maine said it took advantage of lower feed costs during the quarter, but cautioned that corn prices have climbed and will likely stay volatile in the coming year.
The company said that the recent U.S. egg recall related to a salmonella outbreak had a minimal effect on its quarterly performance.
Chairman and CEO Fred Adams Jr. said in a statement that egg prices have fallen below levels prior to the recall. While acknowledging egg demand has declined since the recall, Adams said it was too soon to determine any long-term impact.
Its shares fell 50 cents, or 1.6 percent, to $29.80 in morning trading Monday.
The company reported that it earned $4.8 million, or 20 cents per share, for the period ended Aug. 28. That compares with a loss of $3.8 million, or 16 cents per share, a year earlier.
Quarterly results included an approximately $2.6 million insurance gain related to fire damage at its Farwell, Texas plant in July.
Analysts surveyed by Thomson Reuters, whose estimates usually take out one-time items, predicted a loss of 7 cents per share.
Revenue rose 1 percent to $190.4 million from $187.7 million on better demand for its more expensive specialty eggs. Analysts expected $190.1 million.
Volume and average selling prices improved modestly, the company said.
As part of the nationwide egg recall tied to a salmonella outbreak, Cal-Maine said last month it was recalling about 800,000 dozen eggs that it purchased from an Iowa producer.
But that figure is but a tiny fraction of its sales. Cal-Maine said it sold about 194 million dozen eggs in June-August period including about 38.6 million dozen eggs it purchased.
Cal-Maine declared a quarterly dividend of about 6.7 cents. The dividend will be paid on Nov. 11 to shareholders of record Oct. 27.
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