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Shares of Cal-Maine Foods Inc. edged lower in the extended session Tuesday after the largest U.S. egg producer and distributor reported mixed quarterly results and warned that the avian flu outbreak will continue to hit egg supplies for the rest of the year “and possibly beyond.”
Cal-Maine
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earned $125.3 million, or $2.57 a share, in the fiscal 2023 first quarter, swinging from a loss of $18 million, or 37 cents a share, in the year-ago period.
Sales rose 103% to $658.3 million, from $325 million in the first quarter of fiscal 2022.
Analysts polled by FactSet expected Cal-Maine to report earnings of $2.72 a share on sales of $617 million.
On average, a dozen eggs sold for $2.275 in the quarter, from $1.235 a year ago, Cal-Maine said. The FactSet analysts called for an average selling price of $2.34 a dozen.
Cal-Maine includes conventional as well as specialty eggs in its average. Conventional eggs had a steeper rise, going for $2.368 a dozen in the quarter from 99 cents a dozen a year ago, the company said.
See also: Why egg prices are sizzling
Egg prices continued to rise in the quarter as supply tightened due to the ongoing impact of the avian influenza outbreak and “good customer demand for conventional eggs,” Cal-Maine said.
Cal-Maine said it continued to “monitor” the outbreak, which was first detected in commercial flocks in the U.S. in February and as recently as earlier this month.
While the detections “do not present an immediate public health concern” and there have been no positive tests for the flu at a Cal-Maine-owned or -contracted production facility, “the company believes that HPAI outbreak will continue to have an impact on the overall supply of eggs through the balance of this calendar year and possibly beyond.”
The company implemented and maintains “robust” biosecurity programs to fend off the virus, it said.
Company operations ran smoothly in the quarter despite inflation contributing to higher prices for feed, labor, packaging and distribution, among other costs, Chief Executive Dolph Baker said in a statement.
Shares of Cal-Maine have gained more than 64% so far this year, contrasting with losses of around 23% for the S&P 500 index
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