US egg firm Cal-Maine Foods has booked an increase in full-year profits as gains from a new venture in the speciality egg market more than offset higher costs from its fresh shell eggs.
In the 12 months ended 2 June, net profit climbed 47.5% to US$89.7m, the company reported today (30 July). Cal-Maine's Eggland's Best egg cooperative arranged a joint venture with Land O' Lakes in May to extend its reach in the speciality egg market.
Operating profit in the period increased 6.2% to $88.6m, while net sales amounted to $1.11bn compared to $941.9m last year.
"Our operations have continued to run well in fiscal 2012," said president and CEO Dolph Baker. While our feed costs were high and volatile during the year, our management team has remained focused on executing our strategy of being an efficient, low cost producer."
This month, the firm also agreed to acquire Pilgrim's Pride's commercial-egg operations in a bid to enhance its Texas operations.
Show the press release
Cal-Maine Foods, Inc. Reports Fourth Quarter and Fiscal 2012 Results
JACKSON, Miss.--(BUSINESS WIRE)--
Cal-Maine Foods, Inc. (CALM) today announced financial results for the fourth quarter and fiscal year ended June 2, 2012.
For the fourth quarter of fiscal 2012, net sales were $275.2 million compared with net sales of $242.4 million for the fourth quarter a year ago. The Company reported net earnings of $37.3 million, or $1.56 per basic share, for the fourth quarter of fiscal 2012 compared with net earnings of $7.3 million, or $0.30 per basic share, for the same period last year. Results for the fourth quarter of fiscal 2012 include a one-time gain of approximately $27.0 million, or $1.12 per share, after tax, as a result of a distribution from Eggland's Best, Inc. related to the new joint venture between Eggland's Best, Inc. and Land O'Lakes, Inc., announced on May 1, 2012. The fourth quarter of fiscal 2012 had 14 weeks compared with 13 weeks in the prior year period.
For the fiscal year 2012, net sales were $1.1 billion compared with net sales of $942.0 million for fiscal 2011. The Company reported net income of $89.7 million, or $3.76 per basic share, for fiscal 2012 compared with net income of $60.8 million, or $2.55 per basic share, in fiscal 2011. Fiscal 2012 had 53 weeks compared with 52 weeks in fiscal 2011.
Commenting on the results, Dolph Baker, president and chief executive officer of Cal-Maine Foods, Inc., stated, "Our financial and operating results for the fourth quarter marked a strong finish to fiscal 2012. These results reflect higher volumes with an 8.6 percent increase in eggs produced and 11.0 percent increase in eggs sold compared with the same period a year ago. While we had an extra week of sales compared with the fourth quarter of fiscal 2011, we also had less Easter-related business fall in the fourth quarter due to the earlier holiday schedule in 2012.
"For the year, we were pleased to exceed $1.0 billion in sales for the first time in our history," Baker noted. "Retail demand was strong and helped the market absorb a slightly higher egg supply than we experienced in fiscal 2011. Sales of specialty eggs have continued to rise, accounting for 16.3 percent of our total number of eggs sold and over 24.0 percent of sales revenue for the year. Specialty eggs generally have a higher and more stable average retail selling price and the 9.1 percent increase in specialty egg volume helped push our average selling prices up 9.7 percent for the year. We expect specialty eggs will continue to gain market share over regular eggs as consumer demand trends shift toward the perceived health benefits of organic and natural food alternatives.
"Our operations have continued to run well in fiscal 2012. While our feed costs were high and volatile during the year, our management team has remained focused on executing our strategy of being an efficient, low cost producer. We expect feed costs will continue to rise for the near term, especially in light of the severe drought this summer and the damage to the national corn crop.
"Overall, we are very pleased with Cal-Maine's performance in fiscal 2012 and believe we have opportunities for continued growth in the year ahead. Our strong balance sheet provides us with the flexibility to pursue our strategic initiatives. We believe we will continue to improve our product mix and expand our sales of specialty eggs, both in our current markets and through the new joint venture with Eggland's Best, Inc. and Land O'Lakes. Our recent acquisition of the Pilgrim's Pride egg operations is expected to further enhance our sales efforts in the important Texas markets. We will continue to look for additional strategic acquisition opportunities and pursue a growth strategy that we believe will reward both our customers and shareholders," Baker concluded.
For the fourth quarter of fiscal 2012, Cal-Maine Foods, Inc. will pay a cash dividend of approximately $0.520 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 on August 26, 2012, to shareholders of record on August 11, 2012.
