Cal-Maine Foods reported net sales of $459.3 million results in the first quarter of fiscal 2024 ending September 2023, a decrease of 43% compared to net sales in the first quarter of fiscal 2023.
The significant loss was due to a drop in shell egg prices over the last year as the U.S. restored its layer supply and recovered from the outbreaks of highly pathogenic avian influenza (HPAI), Max Bowman, Cal-Maine Foods Vice President and Chief Financial Officer, explained in the company’s recent financial review.
Bowman said: “For the first quarter of fiscal 2024, our net sales were $459.3 million compared with $658.3 million for the same period last year, which was an exceptionally strong first quarter performance driven by record average conventional selling prices and record specialty sales volumes. The decline in revenue for the first quarter of fiscal 2024 was primarily due to the decrease in the net average selling price for conventional eggs, partially offset by the increase in the net average selling price for specialty eggs.”
Over the quarter, the average price of conventional shell eggs was US$1.241 per dozen, compared to US$2.368 in the prior-year quarter. The average selling price for specialty eggs increased to US$2.278 per dozen, and 8.4% increase compared to $2.101 per dozen in the same quarter last year.
Additionally, Sherman Miller, Cal-Maine Foods President and Chief Executive Officer, explained that customer demand in the quarter was favorable, but was offset by lower sales of specialty eggs. Cal-Maine is working on multiple expansion projects to continue increasing its production capacity, one being its recent acquisition of Fassio Egg Farms.
Feed costs improved in the quarter
Even though the producer continued to see higher production, processing and distribution costs through the quarter, it benefitted from lower feed costs. Feed costs per dozen were US$0.597 in the first quarter of fiscal 2024, a 10.5% decrease compared to the first quarter of fiscal 2023.
Miller said, “We reported an operating loss of $6.8 million for the first quarter of fiscal 2024, compared with operating income of $163.9 million for the prior-year quarter, reflecting lower conventional shell egg prices and increased labor costs, partially offset by lower farm production costs due to the decrease in feed ingredient prices.”
