Cal-Maine sees sales rise, earnings fall
JACKSON — Cal-Maine Foods Inc., for the second quarter ended Nov. 27, 2010, saw net sales of $234.5 million, compared with net sales of $229.2 million for the same quarter of fiscal 2010.
The company reported net income of $15.2 million, or $0.64 per basic share, compared with net income of $16.1 million, or $0.68 per basic share, for the second quarter of fiscal 2010.
For the first six months of fiscal 2011, net sales were $424.9 million compared with net sales of $416.9 million for the prior-year period. The company reported net income of $19.9 million, or $0.84 per basic share, compared with net income of $12.3 million, or $0.52 per basic share, for the year-earlier period.
Dolph Baker, president and chief executive officer of Cal-Maine said, “The financial results for the second quarter of fiscal 2011 reflect recent improved market conditions. We reported improved sales from a year ago due to higher average selling prices; however, our profitability was affected by higher feed costs. While demand for eggs suffered in early September as a result of the nationwide egg recall, American Egg Board research indicates egg demand has now rebounded to pre-recall levels. Also, egg market prices moved to near yearly highs during the second quarter. Overall, the national egg supply is flat compared with the same time last year. We are also pleased that our specialty egg sales have continued to grow even in a difficult economic environment, accounting for 15.5 percent of our dozens sold for the quarter.
“We continue to monitor the national chick hatch, which has been trending higher, and will affect future supply. Feed costs also remain a concern for fiscal 2011. For the second quarter, feed cost per dozen produced increased by four cents compared with the same quarter last year. The current and expected balance of supply and demand for corn and soybean meal points to a tight feed supply throughout the next marketing year.
“Overall, our management team is solid and our operations are running smoothly.”
Cal-Maine’s dividend policy is to pay one-third of net income for the quarter in the form of a cash dividend. For the second quarter of fiscal 2011, Cal-Maine will pay a cash dividend of approximately $0.212 per share to holders of its common and Class A common stock. The amount paid could vary slightly based on the amount of outstanding shares on the record date. The dividend is payable Feb. 10, 2011, to shareholders of record on Jan 26, 2011.
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