Cal-Maine Foods reported record quarterly net sales of US$801.7 million, a 110% increase compared to the same quarter last year, during its financial review for the second quarter of fiscal 2023.
The record is attributed to historically high conventional egg prices. The egg producer also reported a record quarterly net income of US$198.6 million and a gross profit margin of 39.6%.
“These results reflect the current market environment characterized by record average selling prices for conventional eggs, primarily due to reduced supply related to the outbreak in the U.S. of highly pathogenic avian influenza (HPAI), and good customer demand,” stated Sherman Miller, Cal-Maine Foods Chief Executive Officer.
The conventional egg net average selling price increased to US$2.883 per dozen, compared to US$1.151 the same time last year. The net average selling price for specialty eggs increased 24.9% to US$2.370 per dozen, compared to US$1.898 in the second quarter of 2022.
Cal-Maine’s total dozens sold increased by 5.4% to 284.1 million, compared to 269.6 million in 2022’s Q2. This was attributed to greater sales in the specialty eggs category. Its volume of conventional eggs sold decreased 2.2%, while the volume of specialty eggs sold increased by 24.1%.
Max Bowman, Cal-Maine Foods Chief Financial Officer, added, “The significantly higher selling prices, our enduring focus on cost control, and our ability to adapt to inflationary market pressures led to improved profitability overall with a gross profit margin of 39.6% for the second quarter of fiscal 2023…”
Conventional eggs are more expensive than specialty eggs
The higher conventional egg prices the industry saw in 2022 positively impacted the demand for specialty eggs.
According to Cal-Maine, conventional egg prices exceeding specialty egg prices has occurred for the past three quarters but is abnormal historically. Specialty egg demand was additionally supported by California’s and Massachusetts’ cage-free housing mandates, which were implemented on January 1, 2022.
The egg producer reported its highest ever quarterly sales of specialty eggs at US$227.8 million, or 29.4% of its total shell egg revenue. Specialty dozens sold were 33.8% of all dozens sold, compared to 28.7% in the same quarter last year.
“Consumer demand for shell eggs continued to be good in the quarter, especially leading up to the Thanksgiving holiday, and we experienced record quarterly volume levels for specialty eggs sold,” said Miller.
