Cal-Maine Foods(CALM) - 2024 Q4 - Annual Results

Cal-Maine Foods Fourth Quarter and Fiscal 2024 Earnings Release Financial & Operational Highlights Cal-Maine Foods reported solid Q4 results with increased net income and lower production costs, despite a fiscal year sales decline driven by lower egg prices, while strategically expanding through acquisitions Q4 & Fiscal Year 2024 Performance Summary Cal-Maine Foods reported Q4 net sales of $640.8 million and net income of $113.2 million, with fiscal year net sales of $2.3 billion and net income of $277.9 million, alongside a $0.77 per share dividend Q4 & Fiscal Year 2024 Key Financial Metrics | Metric | Fourth Quarter 2024 | Fiscal Year 2024 | | :--- | :--- | :--- | | Net Sales | $640.8 million | $2.3 billion | | Net Income | $113.2 million | $277.9 million | | Diluted EPS | $2.32 | $5.69 | | Cash Dividend | $0.77 per share | N/A | Sales and Operating Performance Q4 net sales declined due to a shorter quarter, while full-year sales dropped due to lower conventional egg prices, though specialty egg volumes grew and profitability improved significantly from lower feed costs - Q4 sales revenue declined due to a shorter quarter, while the fiscal year sales decrease was primarily driven by lower net average selling prices for conventional eggs compared to fiscal 2023 record highs[5][7] - Farm production costs per dozen decreased by 14.3% in Q4 and 8.3% in fiscal 2024, primarily due to more favorable feed ingredient costs, with feed costs per dozen down 24.9% in Q4 and 18.6% for the full year[7] Operating Metrics Per Dozen | Operating Metric (per dozen) | Q4 FY2024 | Q4 FY2023 | Change | | :--- | :--- | :--- | :--- | | Net Average Selling Price | $2.133 | $2.197 | -2.9% | | Conventional Egg Price | $2.062 | $2.038 | +1.2% | | Specialty Egg Price | $2.254 | $2.499 | -9.8% | | Feed Cost | $0.504 | $0.671 | -24.9% | Sales Volume (Million Dozens) | Sales Volume (million dozens) | Q4 FY2024 | Q4 FY2023 | Change | | :--- | :--- | :--- | :--- | | Total Dozens Sold | 285.6 | 296.6 | -3.7% | | Conventional Dozens Sold | 180.5 | 194.0 | -7.0% | | Specialty Dozens Sold | 105.0 | 102.5 | +2.5% | Strategic Initiatives and Acquisitions Cal-Maine Foods pursued its growth strategy by completing three key acquisitions, including Fassio Egg Farms and ISE America, Inc., to enhance market presence and expand shell egg production - The company completed three key acquisitions to complement organic growth, including Fassio Egg Farms, a former Tyson Foods facility for repurposing, and ISE America, Inc. post-fiscal year-end[4] - The acquisition of ISE America's assets is a strategic move to significantly enhance market reach in the Northeast and Mid-Atlantic states[4] Business Environment and Outlook The company navigates HPAI outbreaks by repopulating affected farms, anticipates strong shell egg demand in fiscal 2025, and plans to expand specialty and cage-free production while maintaining financial strength for growth HPAI Impact and Supply Outlook HPAI remains a significant industry challenge, impacting Cal-Maine Foods' Kansas and Texas facilities with depopulation of approximately 3.1 million laying hens and 577,000 pullets, though repopulation is underway with USDA clearance - Since November 2023, HPAI outbreaks have led to the depopulation of approximately 32.8 million commercial laying hens and pullets in the U.S[9] - Cal-Maine Foods' facilities in Kansas and Texas were directly impacted, resulting in the total depopulation of approximately 3.1 million laying hens and 577,000 pullets[9] - The affected company locations have been cleared by the USDA to resume operations, with repopulation anticipated to be finished before the end of the calendar year[9] Fiscal 2025 Outlook For fiscal 2025, Cal-Maine Foods anticipates continued strong shell egg demand, focusing on expanding specialty and cage-free production, and leveraging its financial strength for internal growth and strategic acquisitions - Management believes shell egg demand will remain strong in fiscal 2025, with consumers favoring them as an affordable protein source[12] - The company will continue to focus on expanding production of specialty and cage-free eggs to meet consumer demand trends[12] - Cal-Maine Foods has the financial strength to fund internal expansion projects and consider strategic acquisitions to support growth[12] Shareholder Returns In line with its variable dividend policy, Cal-Maine Foods declared a cash dividend for Q4 fiscal 2024, paying out one-third of quarterly net income to shareholders Dividend Declaration The company will pay a cash dividend of approximately $0.77 per share for Q4 fiscal 2024, payable on August 20, 2024, to shareholders of record as of August 5, 2024 Dividend Declaration Details | Dividend Information | Detail | | :--- | :--- | | Dividend per Share | ~$0.77 | | Record Date | August 5, 2024 | | Payable Date | August 20, 2024 | Financial Statements Unaudited financial statements show decreased annual net sales and net income for fiscal 2024, with a slight Q4 net income increase, and a stronger balance sheet reflecting increased cash, total assets, and stockholders' equity Summary Statements of Income For fiscal year 2024, net sales were $2.33 billion and net income $277.9 million, both down from fiscal 2023, while Q4 net sales were $640.8 million with net income slightly increasing to $113.2 million Summary Statements of Income (In thousands) | (In thousands) | Q4 FY2024 | Q4 FY2023 | FY 2024 | FY 2023 | | :--- | :--- | :--- | :--- | :--- | | Net sales | $640,789 | $688,680 | $2,326,443 | $3,146,217 | | Gross profit | $186,436 | $198,092 | $541,571 | $1,196,457 | | Operating income | $142,188 | $136,225 | $312,452 | $967,726 | | Net income attributable to CALM | $113,241 | $110,931 | $277,888 | $758,024 | Summary Balance Sheets As of June 1, 2024, Cal-Maine Foods reported a strengthened balance sheet with total assets increasing to $2.18 billion, cash and short-term investments rising to $812.4 million, and stockholders' equity growing to $1.80 billion Summary Balance Sheets (In thousands) | (In thousands) | June 1, 2024 | June 3, 2023 | | :--- | :--- | :--- | | Cash and short-term investments | $812,377 | $647,914 | | Total current assets | $1,241,839 | $1,124,925 | | Total assets | $2,184,761 | $1,954,525 | | Total current liabilities | $227,743 | $182,731 | | Stockholders' equity | $1,797,043 | $1,609,583 |