The largest egg producer in the United States, Cal-Maine Foods, more than doubled its revenue in the last quarter, while increasing profits by more than seven times, despite selling only 1% more eggs.
CNN reports the company, which controls approximately 20% of the egg market, sold just a single percentage point more of eggs in the quarter ending on February 25, 2023, with an overall revenue increase of 109% to $997.5 million.
However, profits increased to $323.2 million from just $39.5 million the year before.
Investors.com explains the discrepancy in figures, first by noting that the third-quarter profits were projected to increase by 575%, but surpassed even those giant gains by bringing in 717%, increasing stock prices by over $6.62 per share.
Cal-Maine Foods increased its price for conventional eggs by 152% in the same quarter, up to $3.68 per dozen. Comparatively, the average selling price for specialty eggs was $2.62 per dozen, an increase of 70 cents per dozen since Q3 2022, when the prices were approximately $1.92.
This means that the egg producer priced its conventional eggs more than a dollar higher than the average specialty egg, with the company stating that to be "atypical historically."
Sherman Miller, the company's CEO, reportedly told investors that the earnings spike is due to increased average selling prices of conventional eggs, along with high customer demand.
"Elevated market pricing continues, primarily due to the impact of the ongoing epidemic of highly pathogenic avian influenza," Sherman reportedly said in a news release.
The CEO also claimed that the avian flu has caused increased costs and supply chain problems, but it was also reported that there have been no bird flu outbreaks at any of the production facilities owned or contracted by Cal-Maine Foods.
Share prices have settled slightly since; however, the average price per share has increased by at least $20 in the last two years. For example, shares were $34.91 in May 2021, compared to $57.96 in March 2023.
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