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Cal-Maine founder dies; egg company turns quarterly profit

Fred Adams

By JACK WEATHERLY

Cal-Maine Foods Inc. on Monday announced that Fred R. Adams, Jr., the company’s founder and chairman emeritus, died Sunday at the age of 88 following an extended illness.

Adams founded Adams Egg Co. in 1957, which was the predecessor to Cal-Maine Foods, Inc., which incorporated in 1969. He served as chairman and CEO until 2012.

Under his leadership, Cal-Maine Foods became the largest producer and distributor of fresh shell eggs in the United States with fiscal 2019 sales of approximately 1.039 billion dozen shell eggs, representing approximately 19 percent of domestic shell egg consumption in the United States.

Adams remained active in trade associations throughout his career. He served as a director of National Egg Company, United Egg Producers, U.S. Egg Marketers, Egg Clearinghouse, Inc. and the Mississippi Poultry Association.

Dolph Baker, chairman and chief executive officer of Cal-Maine, stated in a release, “We deeply mourn the passing of our beloved friend, colleague, and founder. Fred Adams played a vital role in the growth and success of Cal-Maine Foods, and he was widely recognized as a visionary and passionate leader who built a company known for operational excellence and an unwavering commitment to our customers.”

Cal-Maine also announced on Monday its results for its third fiscal quarter, which ended Feb. 29.

The company reported net income of $13.7 million, or 28 cents per share, compared with net income of $39.8 million, or 82 cents per share for the third quarter of fiscal 2019.

Net sales for the third quarter of fiscal 2020 were $345.6 million, a 10 percent decrease, compared with $384 million for the third quarter of fiscal 2019.

The industry, of which Cal-Maine is the largest producer, remains overstocked.

Dolph Baker, chairman and chief executive officer, stated in a release that “we were pleased with our ability to execute our strategy in this environment and return to profitability for the quarter.”

The company reported a net loss of $10.1 million, or 21 cents per share, for the second quarter of fiscal 2020,following a loss for the first quarter.

The Jackson-based company’s earnings of 28 cents per share beat analyst estimates of 19 cents.

Cal-Maine shares closed at $42.44 on the NasdaqGS stock market, up two cents. Its shares have ranged from $30.74 to $47 in the past 52 weeks.

Cal-Maine’s revenue declined 10 percent declined to $345.6 million but beat analyst estimates of $338 million.

“We believe we are taking all reasonable precautions in the management of our operations in response to the outbreak of COVID-19,” Baker said. “To date, Cal-Maine Foods facilities are operating normally, and we have not experienced any supply chain or delivery disruptions. Our top priority is the health and safety of our employees, who work hard every day to produce eggs for our customers. As part of the nation’s food supply, we work in a critical infrastructure industry, and we have a special responsibility to maintain our normal work schedule.

“We are providing supplemental pay to all of our employees to assist them and their families at this critical time. We have strict sanitation protocols and biosecurity measures in place throughout our operations with restricted access to visitors. All non-essential corporate travel has been suspended. Fortunately, there are no known indications that COVID-19 affects hens or can be transferred through the food supply.”

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About Jack Weatherly