July 26, 2011
Cal-Maine Q4 earnings fall 65% on higher feed costs
Cal-Maine Foods Inc.'s fiscal fourth-quarter earnings plummeted 65%, as the largest US egg producer and distributor was hit with a 37% jump in feed costs.
The company, whose quarterly dividend is linked to profits, will pay holders US$0.102 a share for the latest quarter, down from US$0.47 in the previous quarter.
Cal-Maine, which owns Eggland's Best and Farmhouse egg brands, was hurt late last year by rising feed costs, though sales have continued to improve from weak levels during the recession.
President and Chief Executive Dolph Baker said that "higher retail demand associated with a late Easter holiday and a slightly smaller national flock helped boost egg prices."
For the quarter ended May 28, Cal-Maine's profit was US$7.3 million, or US$0.30 a share, down from the previous year's US$21 million, or US$0.88 a share.
Net sales increased 9.1% to US$242.4 million, as average selling prices rose 3.5% and volume grew by 5.6%. Gross margin fell to 17.1% from 24.6%.
Shares closed Friday (Jul 22) at US$35.51 and were inactive premarket. The stock is up 12% this year.