Cal-Maine Foods reported results for the second quarter of fiscal 2023 ended November 28, 2022.
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Net sales in the second quarter of fiscal 2023 were $801.7 million, compared with $381.7 million in the second quarter of fiscal 2022.
Cal-Maine Foods reported net income of $198.6 million, or $4.08 per basic and $4.07 per diluted common share, compared with a net income of $1.2 million, or $0.02 per basic and diluted common share, in the prior-year period.
For the second quarter of fiscal 2023, total dozens sold increased 5.4% to 284.1 million versus 269.6 million in the prior-year quarter, driven by strong sales volumes in the specialty eggs category.
Conventional egg volumes sold decreased 2.2% compared with second quarter 2022, while specialty egg volumes sold increased by 24.1%.
This increase in demand for specialty eggs was positively affected by the higher conventional egg prices as compared to the same period in the prior year. Conventional egg prices exceeding specialty egg prices has occurred for the past three quarters but is atypical historically.
Demand was further supported by California’s and Massachusetts’ cage-free mandates going into effect January 1, 2022, as well as more retailers shifting to selling more cage-free products.
The Company reported operating income of $259.9 million for the second quarter of fiscal 2023 amidst a challenging environment with higher costs across various inputs including feed, labor, packaging, and distribution.
Overall, farm production costs per dozen increased 22.0%, or $0.193, compared with the prior-year period, primarily tied to significantly higher feed costs.
For the second quarter of fiscal 2023, feed costs per dozen were $0.685, a 29.5% increase compared with the second quarter of fiscal 2022. Supplies of corn and soybean remained tight relative to demand in the second quarter of fiscal 2023, as evidenced by a low stock-to-use ratio for corn, due to weather-related shortfalls in production and yields, ongoing disruptions related to the COVID-19 global pandemic and the Russia-Ukraine war and its impact on the export markets.
Additionally, basis levels for corn ran significantly higher in the Company’s area of operations compared to prior- year second fiscal quarter, adding to the Company’s expense. For fiscal 2023, the Company expects continued corn and soybean upward pricing pressures and further market volatility to affect feed costs. ■