1
UNITED STATES
 
SECURITIES AND EXCHANGE COMMISSION
Washington,
DC
 
20549
FORM
10-Q
 
☑
 
Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the quarterly period ended
November 26, 2022September 2, 2023
 
or
☐
 
Transition report pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the transition period from ____________ to ____________
Commission File Number:
 
001-38695
 
CAL-MAINE FOODS, INC.
(Exact name of registrant as specified in its charter)
Delaware
 
64-0500378
(State or other jurisdiction of incorporation or organization)
 
(I.R.S Employer Identification No.)
1052 Highland Colony Pkwy
,
Suite 200
,
Ridgeland
,
Mississippi
 
39157
 
(Address of principal executive offices)
 
(Zip Code)
(
601
)
948-6813
 
(Registrant’s telephone number,
including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common Stock, $0.01 par value per share
CALM
The
NASDAQ
 
Global Select Market
Indicate
 
by
 
check
 
mark
 
whether
 
the
 
registrant:
(1)
 
has
 
filed
 
all
 
reports
 
required
 
to
 
be
 
filed
 
by
 
Section
 
13
 
or
 
15(d)
 
of
 
the
Securities Exchange Act of
 
Act of 1934 during the
 
during the preceding
12 months (or
 
for such shorter period
 
shorter period that
the registrant was
 
required to
file such reports), and (2) has been subject to such filing requirements for the past
90 days.
Yes
☑
 
No
☐
Indicate by check mark
 
mark whether the registrant has
 
registrant has submitted electronically every Interactive Data
 
electronically every
Interactive Data File
required to be
 
submitted
pursuant to
 
Rule 405 of
 
of Regulation
S-T (§232.405
 
of this
 
chapter) during
 
the preceding
 
12 months
 
(or for
 
such shorter
period
that the registrant was required to submit such files).
Yes
☑
 
No
☐
Indicate by check
 
check mark whether the
 
whether the registrant is a
 
is a large
accelerated filer,
 
an accelerated filer,
 
filer, a
non-accelerated filer,
 
a smaller
reporting
 
company,
 
or
 
an
 
emerging
 
growth
 
company.
 
See
 
the
 
definitions
 
of
 
“large
 
accelerated
 
filer,”
 
“accelerated
 
filer”,filer,”
“smaller reporting company”,company,” and “emerging growth
company” in Rule 12b-2 of the Exchange Act.
Large Accelerated filer
☑
Accelerated filer
 
☐
Non – Accelerated filer
 
☐
Smaller reporting company
 
☐
Emerging growth company
 
☐
If
 
an
 
emerging
 
growth
 
company,
 
indicate
 
by
 
check
 
mark
 
if
 
the
 
registrant
 
has
 
elected
 
not
 
to
 
use
 
the
 
extended
transition
 
period
 
for
 
complying
 
with
 
any
 
new
 
or
 
revised
 
financial
 
accounting
 
standards
 
provided
 
pursuant
 
to
Section 13(a) of the Exchange ActAct.
☐
Indicate by check mark whether the registrant is a shell company (as defined
in Rule 12b-2 of the Exchange Act).
Yes
☐
 
No
☑
There were
44,130,14944,182,613
 
shares of Common
 
Common Stock, $0.01 par
 
$0.01 par value,
and
4,800,000
 
shares of Class
 
A Common Stock,
 
Stock, $0.01
$0.01 par
value, outstanding as of December 28, 2022.October 3, 2023.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
3
PART
 
I.
 
FINANCIAL
INFORMATION
ITEM 1.
 
FINANCIAL STATEMENTS
Cal-Maine Foods, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(In thousands, except for par value amounts)
 
(Unaudited)
 
November 26, 2022September 2, 2023
May 28, 2022June 3, 2023
Assets
Current assets:
Cash and cash equivalents
$
178,635360,343
$
59,084292,824
Investment securities available-for-sale
200,714249,619
115,429355,090
Trade and other receivables, net
262,964125,363
177,257120,247
Income tax receivable
42,14733,787
42,14766,966
Inventories
280,582280,801
263,316284,418
Prepaid expenses and other current assets
8,96814,145
4,2865,380
Total current
assets
974,0101,064,058
661,5191,124,925
Property, plant &
equipment, net
703,882752,580
677,796744,540
Investments in unconsolidated entities
14,68713,978
15,53014,449
Goodwill
44,006
44,006
Intangible assets, net
17,03715,347
18,13115,897
Other long-term assets
9,81810,398
10,50710,708
Total Assets
$
1,763,4401,900,367
$
1,427,4891,954,525
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable and accrued expenses
$
154,624117,800
$
122,331137,313
Accrued income taxes payable
85,7238,288
25,6878,288
Dividends payable
66,202294
36,65637,130
Total current
liabilities
306,549126,382
184,674182,731
Other noncurrent liabilities
9,4109,930
10,2749,999
Deferred income taxes, net
127,176152,725
128,196152,212
Total liabilities
443,135289,037
323,144344,942
Commitments and contingencies - see Note 9
—
—
Stockholders’ equity:
Common stock ($
0.01
 
par value):
Common stock - authorized
120,000
 
shares, issued
70,261
 
shares
703
703
Class A convertible common stock - authorized and issued
4,800
 
shares
48
48
Paid-in capital
70,00573,153
67,98972,112
Retained earnings
1,281,7841,571,744
1,065,8541,571,112
Accumulated other comprehensive loss, net of tax
(3,087)(2,291)
(1,596)(2,886)
Common stock in treasury at cost –
26,12626,078
 
shares at November 26, 2022September 2, 2023 and
26,12126,077
shares at May 28, 2022June 3, 2023
(28,496)(30,014)
(28,447)(30,008)
Total Cal-Maine Foods,
Inc. stockholders’ equity
1,320,9571,613,343
1,104,5511,611,081
Noncontrolling interest in consolidated entity
(652)(2,013)
(206)(1,498)
Total stockholders’
equity
1,320,3051,611,330
1,104,3451,609,583
Total Liabilities and Stockholders’
Equity
$
1,763,4401,900,367
$
1,427,4891,954,525
See Notes to Condensed Consolidated Financial Statements.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
4
Cal-Maine Foods, Inc. and Subsidiaries
Condensed Consolidated Statements of OperationsIncome
(In thousands, except per share amounts)
(Unaudited)
 
Thirteen Weeks
Ended
Twenty-six Weeks
EndedSeptember 2, 2023
November 26,August 27, 2022
November 27, 2021
November 26, 2022
November 27, 2021
Net sales
$
801,700459,344
$
381,723
$
1,460,044
$
706,709658,344
Cost of sales
483,851413,911
337,976
924,705
656,317440,854
Gross profit
317,84945,433
43,747
535,339
50,392217,490
Selling, general and administrative
57,95252,246
47,780
111,559
94,30553,607
(Gain) loss on disposal of fixed assets
29(56)
(1,968)
62
(2,181)33
Operating income (loss)
259,868(6,757)
(2,065)
423,718
(41,732)163,850
Other income (expense):
Interest income, net
1,9307,346
129
2,833
361903
Royalty income
344349
278
772
551428
Equity income (loss) of unconsolidated
entities
(987)(470)
264
(843)
399144
Other, net
1,113265
1,862
1,268
7,025155
Total other income, net
2,4007,490
2,533
4,030
8,3361,630
Income (loss) before income taxes
262,268733
468
427,748
(33,396)165,480
Income tax expense (benefit)
63,974322
(677)
104,320
(16,515)40,346
Net income (loss)
198,294411
1,145
323,428
(16,881)125,134
Less: Loss attributable to noncontrolling
interest
(293)(515)
(28)
(446)
(28)(153)
Net income (loss) attributable to Cal-Maine
Foods, Inc.
$
198,587926
$
1,173
$
323,874
$
(16,853)125,287
Net income (loss) per common share:
Basic
$
4.080.02
$
2.58
Diluted
$
0.02
$
6.66
$
(0.34)
Diluted
$
4.07
$
0.02
$
6.63
$
(0.34)2.57
Weighted average
shares outstanding:
Basic
48,62448,690
48,857
48,624
48,85948,623
Diluted
48,840
49,016
48,827
48,85948,811
See Notes to Condensed Consolidated Financial Statements.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
5
Cal-Maine Foods, Inc. and Subsidiaries
Condensed Consolidated Statements of
Comprehensive Income (Loss)
(In thousands)
(Unaudited)
Thirteen Weeks
Ended
Twenty-six Weeks
EndedSeptember 2, 2023
November 26,August 27, 2022
November 27, 2021
November 26, 2022
November 27, 2021
Net income (loss)
$
198,294411
 
$
 
1,145
$
323,428
$
(16,881)125,134
Other comprehensive income (loss), before
tax:
Unrealized holding lossgain (loss) on available-for-
saleavailable-for-sale securities, net of reclassification
adjustments
(974)786
(355)
(1,971)
(579)(997)
Income tax benefit (expense) related to items of other
comprehensive income
237(191)
87
480
141243
Other comprehensive loss,income (loss), net of tax
(737)595
(268)
(1,491)
(438)(754)
Comprehensive income (loss)
197,5571,006
877
321,937
(17,319)124,380
Less: Comprehensive loss attributable to the
noncontrolling interest
(293)(515)
(28)
(446)
(28)(153)
Comprehensive income (loss) attributable to
Cal-Maine Foods, Inc.
$
197,8501,521
$
905
$
322,383
$
(17,291)124,533
See Notes to Condensed Consolidated Financial Statements.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
6
Cal-Maine Foods, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
 
Twenty-sixThirteen Weeks
Ended
November 26,September 2, 2023
August 27, 2022
November 27, 2021
Cash flows from operating activities:
Net income (loss)
$
323,428411
$
(16,881)125,134
Depreciation and amortization
34,72919,340
33,96917,312
Deferred income taxes
(540)322
(15,995)(1,324)
Other adjustments, net
(12,830)3,612
(16,585)31,690
Net cash provided by (used in) operations
344,78723,685
(15,492)172,812
Cash flows from investing activities:
Purchases of investment securities
(152,365)(28,296)
(26,387)(51,834)
Sales and maturities of investment securities
65,279135,768
67,864
Distributions from unconsolidated entities
—
400
Acquisition of business, net of cash acquired
—
(44,823)20,296
Purchases of property,
plant and equipment
(59,709)(26,666)
(28,647)(27,662)
Net proceeds from disposal of property,
plant and equipment
9274
5,33878
Net cash used inprovided by (used in) investing activities
(146,703)80,880
(26,255)(59,122)
Cash flows from financing activities:
Payments of dividends
(78,394)(36,983)
—(36,653)
Purchase of common stock by treasury
(45)(5)
(18)(45)
Principal payments on finance lease
(94)(58)
(106)
Contributions
—
3(55)
Net cash used in financing activities
(78,533)(37,046)
(121)(36,753)
Net change in cash and cash equivalents
119,55167,519
(41,868)76,937
Cash and cash equivalents at beginning of period
59,084292,824
57,35259,084
Cash and cash equivalents at end of period
$
178,635360,343
$
15,484136,021
See Notes to Condensed Consolidated Financial Statements.
7
Cal-Maine Foods, Inc. and Subsidiaries
Notes to Condensed Consolidated Financial Statements
(Unaudited)
Note 1 - Summary of Significant Accounting Policies
Basis of Presentation
The
 
unaudited
 
condensed
 
consolidated
 
financial
 
statements
 
of
 
Cal-Maine
 
Foods,
 
Inc.
 
and
 
its
 
subsidiaries
 
(the
 
“Company,”
“we,” “us,” “our”) have
 
have been prepared in accordance
 
in accordance with
the instructions to
 
Form 10-Q and Article
 
Article 10 of Regulation S-X
 
Regulation S-X and
in
accordance
 
with generally
 
accepted
accounting
 
principles in
 
the
United
 
States of
 
America
(“GAAP”)
 
for
interim
 
financial
reporting and should
 
be read in conjunction
 
conjunction with our
Annual Report on
 
on Form 10-K for
 
for the fiscal year
 
ended May 28,June 3,
 
20222023 (the
“20222023
 
Annual
Report”).
 
These
 
statements
 
reflect
 
all
 
adjustments
 
that
 
are,
 
in
 
the
 
opinion
 
of
 
management,
 
necessary
 
to
 
a
 
fair
statement of the results for
the interim periods presented and,
 
and, in the opinion of
management, consist of adjustments of a
 
of a normal
recurring nature. Operating results
 
Operating results for
the interim periods
 
are not necessarily indicative
 
indicative of operating results for
 
results for the
entire fiscal
year.
Fiscal Year
The Company’s
 
fiscal year
 
ends on
 
the Saturday
 
closest to
 
May 31.
 
Each of
 
the three-month
 
periods andended
 
year-to-date periodson September
2,
ended on November 26,2023 and August 27, 2022 and November 27, 2021 included
13 weeks
and
26 weeks
, respectively..
Use of Estimates
The preparation of the
consolidated financial statements in
conformity with GAAP requires management to make
 
to make estimates and
assumptions that
 
that affect the
 
the amounts reported
 
reported in the
 
the consolidated financial
 
financial statements and
 
and accompanying notes.
 
notes. Actual
results
could differ from those estimates.
Investment Securities
Our investmentThe Company has
 
securities aredetermined that its
 
accounteddebt securities
are available-for-sale
investments. We
classify these securities
as current
because the
amounts invested
are available
 
for incurrent
 
accordance withoperations. Available
 
ASC 320,-for-sale securities
 
“Investments -are carried
 
Debt andat fair
 
Equity Securities”value, based
on quoted market prices as of the balance sheet
 
(“ASCdate, with unrealized gains and losses recorded in other comprehensive income.
320”).
The
 
Companyamortized cost
 
considers
all
itsof
 
debt
 
securities is
adjusted
 
for
 
whichamortization of
 
therepremiums and
accretion of
discounts
to
maturity and
 
is
recorded in interest income. The Company regularly evaluates
 
achanges to the rating of its debt
 
determinablesecurities by credit agencies and
economic conditions to
assess and record
any expected credit
losses through allowance
for credit losses,
limited to the
amount
that fair value was less than the amortized cost basis.
Investments
in
mutual
funds
are
recorded
at
 
fair
market
 
value
 
and
 
there
are
 
no
restrictionsclassified
 
onas
“Other
long-term
assets”
in
 
the
 
Company’s
Condensed
 
abilityConsolidated
 
toBalance
 
sellSheets.
 
within
the
next
12
months,
as
available-for-sale.
We
classify
these
securities
as
current, because the
amounts invested are available
for current operations.
Available-for-sale
securities are carried at
fair value,
with
unrealizedUnrealized
 
gains
 
and
 
losses
 
reportedfor
equity
securities
are
recorded
 
in
 
other
 
comprehensive
income
until
realized.
The
total
of
other
comprehensive
income for(expenses) as Other, net in the period is presented as a componentCompany’s Condensed Consolidated Statements of stockholders' equity
separately from retained earnings and additional paid-Income.
in
capital.
The
Company
regularly
evaluates
changes
to
the
rating
of
its
debt
securities
by
credit
agencies
and
economic
conditions to assess and record any expected credit
losses through the allowance for credit losses, limited to the amount
that fair
value
was
less
than
the
amortized
cost
basis.
The
cost
basis
 
for realized gains
 
realizedand losses on
 
gainsavailable-for-sale securities is
determined by the
specific identification method.
Gains
 
and
 
losses
 
on
available-for-sale
securities
is
determined by
the specific
identification method.
Gains and
losses are
 
recognized
in
 
other
income
 
(expenses)
as
 
Other,
 
net
in
the
the
Company’s
 
Condensed Consolidated
Statements of
Operations.
Investments in
mutual funds
are classified
as “Other
long-
term assets” in the Company’s Condensed
 
Consolidated Balance Sheets.
Statements of Income. Interest and dividends on securities classified as available-for-sale are recorded in interest income.
Trade Receivables
 
Trade
 
receivables are
 
are stated at
 
at their
 
carrying values,
 
which include
 
include a reserve
 
reserve for credit
 
credit losses. As
 
As of November
 
26, 2022September 2,
2023
 
and
May 28,June 3,
 
2022,2023, reserves
 
for credit
 
losses were
 
$
838503
 
thousand and
 
$
775579
 
thousand, respectively.
 
The Company
 
extends credit
 
to
customers based on
an evaluation of each
 
each customer'scustomer’s financial
condition and credit
history.
 
Collateral is generally
not required.
The
 
Company
 
minimizes
 
exposure
 
to
 
counter
 
party
 
credit
 
risk
 
through
 
credit
 
analysis
 
and
 
approvals,
 
credit
 
limits,
 
and
monitoring
 
procedures.
 
In
 
determining
 
our
 
reserve
 
for
 
credit
 
losses,
 
receivables
 
are
 
assigned
 
an
 
expected
 
loss
 
based
 
on
historical loss information adjusted as needed for economic and
other forward-looking factors.
Dividends Payable
 
We
 
accrue dividends at the
 
the end of each quarter
 
each quarter according
to the Company’s
 
dividend policy adopted by its
 
by its Board
of Directors.
The Company
pays a dividend
to shareholders
of its Common
Stock and
Class A Common
Stock on
 
a quarterly basis
for each
quarter for
which the
Company reports
net income
attributable to
Cal-Maine Foods,
Inc. computed
in accordance
with GAAP
in an amount
equal to one-third
(
1/3
) of such
quarterly income. Dividends
are paiddividend to
 
shareholders of record
as of the 60th
day
following the
last day
of such quarter,
except for
the fourth fiscal
quarter.
For the
fourth quarter,
the Company
pays dividends
8
to shareholders of record on the 65th day after the
quarter end. Dividends are payable on the 15th day
following the record date.
Following a quarter for which the Company does not report net income
attributable to Cal-Maine Foods, Inc., the Company will
not pay a dividend
for a subsequent profitable
quarter until the Company
is profitable on a
cumulative basis computed
from the
date of the most recent quarter for which a dividend was paid.
Immaterial Error Correction
Effective
on
May
30,
2021,
the
Company
acquired
the
remaining
50
%
membership
interest
in
Red
River
Valley
Egg
Farm,
LLC (“Red
River”),
including
certain
liabilities. During
the Company’s
third
quarter of
fiscal 2022,
management
determined
that
it
had
not
properly
eliminated
select
intercompany
sales
and
cost
of
sales
transactions
between
Red
River
and
the
corresponding
other wholly
-owned subsidiaries
of the
Company
in its
 
firstCommon Stock and Class
 
second quarter
2022 Condensed
Consolidated
Statements
of
Operations.
The
errors
resulted
in
an
overstatement
of
Net
Sales and
Cost of
Sales
of
$
6.7
million
in the
first
quarter of fiscal 2022
and $
9.2
million in the second
quarter of fiscal 2022.
There was
no
impact to Operating
loss, Net income
(loss) or Net income (loss) per share.
We
evaluated
the
errors
quantitatively
and
qualitatively
in
accordance
with
Staff
Accounting
Bulletin
("SAB") No. 99 Materiality,
and
SAB No. 108 Considering
the
Effects
of
Prior
Year
Misstatements
when
Quantifying
Misstatements
in
the
Current
Year
Financial
Statements, and
determined
that
the
related
impact
was not material
to
our
condensed
consolidated
financial statements
for
the first
or second
quarters
of fiscal
2022,
but that
correcting
the cumulative
impact
of
the
errors
would
be
relevant
to
our
Condensed
Consolidated
Statements
of
Operations
for
the third
quarter
ended February 26, 2022.
Accordingly,
we have reflected
the correction of
the immaterial error
in fiscal 2022
as a reduction
of
Net Sales and Cost of Sales in the accompanying Condensed Consolidated
Statements of Operations.
New Accounting Pronouncements and Policies
No new accounting pronouncement issued or effective
during the fiscal year had or is expected to have a material impact on
our
Consolidated Financial Statements.
Note 2 - Investment
Securities
The following represents the Company’s
investment securities as of November 26, 2022 and May 28, 2022
(in thousands):
November 26, 2022
Amortized
Cost
Unrealized
Gains
Unrealized
Losses
Estimated
Fair Value
Municipal bonds
$
15,956
$
—
$
276
$
15,680
Commercial paper
33,058
—
53
33,005
Corporate bonds
81,218
—
1,709
79,509
US government and agency obligations
19,111
—
205
18,906
Asset backed securities
13,403
—
340
13,063
Treasury bills
40,644
—
93
40,551
Total current
investment securities
$
203,390
$
—
$
2,676
$
200,714
Mutual funds
$
3,472
$
—
$
114
$
3,358
Total noncurrent
investment securities
$
3,472
$
—
$
114
$
3,358
9
May 28, 2022
Amortized
Cost
Unrealized
Gains
Unrealized
Losses
Estimated
Fair Value
Municipal bonds
$
10,136
$
—
$
32
$
10,104
Commercial paper
14,940
—
72
14,868
Corporate bonds
74,167
—
483
73,684
Certificates of deposits
1,263
—
18
1,245
US government and agency obligations
2,205
4
—
2,209
Asset backed securities
13,456
—
137
13,319
Total current
investment securities
$
116,167
$
4
$
742
$
115,429
Mutual funds
$
3,826
$
—
$
74
$
3,752
Total noncurrent
investment securities
$
3,826
$
—
$
74
$
3,752
Available-for-sale
Proceeds from
sales and
maturities of
investment securities
available-for-sale
were $
65.3
million and
$
67.9
million during
the
twenty-six
weeks
ended November
26,
2022
and
November
27,
2021,
respectively.
Gross
realized
gains
for
the
twenty-six
weeks ended
November 26,
2022 and
November 27,
2021 were
$
2
thousand
and $
165
thousand, respectively.
Gross realized
losses
for
the
twenty-six
weeks
ended
November
26,
2022
and
November
27,
2021
were
$
63
thousand
and
$
67
thousand,
respectively. There were
no
allowances for credit losses at November 26, 2022 and May 28, 2022.
Actual maturities
may differ
from contractual
maturities as some
borrowers have
the right to
call or prepay
obligations with
or
without penalties. Contractual maturities of current investments at November
26, 2022 are as follows (in thousands):
Estimated Fair Value
Within one year
$
133,867
1-5 years
66,847
Total
$
200,714
Noncurrent
There were
no
sales of noncurrent investment
securities during the twenty-six
weeks ended November
26, 2022. Proceeds from
sales and maturities
of noncurrent
investment securities
were $
453
thousand during
the twenty-six
weeks ended November
27,
2021.
Gross
realized
gains
for
the
twenty-six
weeks
ended November
27,
2021
were
$
165
thousand. There
were
no
realized
losses for the twenty-six weeks ended November 27, 2021.
Note 3 - Fair Value
Measurements
The Company
is required
to categorize
both financial
and nonfinancial
assets and
liabilities based
on the
following fair
value
hierarchy. The
fair value
of an
asset is
the price
at which
the asset
could be
sold in
an orderly
transaction between
unrelated,
knowledgeable, and willing
parties able to engage in
the transaction. A liability’s
fair value is defined
as the amount that would
be
paid
to
transfer
the
liability
to
a
new
obligor
in
a
transaction
between
such
parties,
not
the
amount
that
would
be paid
to
settle the liability with the creditor.
•
Level 1
- Quoted prices in active markets for identical assets or liabilities
•
Level 2
- Inputs
other than
quoted
prices included
in Level
1 that
are observable
for the
asset or
liability,
either
directly or indirectly,
including:
◦
Quoted prices for similar assets or liabilities in active markets
◦
Quoted prices for identical or similar assets in non-active markets
◦
Inputs other than quoted prices that are observable for the asset or liability
◦
Inputs derived principally from or corroborated by other observable market
data
•
Level 3
- Unobservable inputs for the asset or liability that are
supported by little or no market activity and that
are
significant to the fair value of the assets or liabilities
10
The disclosures of fair value of certain financial assets and liabilities that are recorded
at cost are as follows:
Cash and cash equivalents, accounts receivable,
and accounts payable:
The carrying amount approximates fair value due to the
short maturity of these instruments.
Lease obligations:
The carrying value of the Company’s lease obligations
is at its present value which approximates fair value.
Assets and Liabilities Measured at Fair
ValueCommon Stock
 
on a Recurring Basis
Inquarterly
 
accordance
with
the
fair
value
hierarchy
described
above,
the
following
table
shows
the
fair
value
of
financial
assets and
liabilities measured at fair value on a recurring basis as of November 26, 2022 and May
28, 2022 (in thousands):for each
November 26, 2022
Level 1
Level 2
Level 3
Balance
Assets
Municipal bonds
$
—
$
15,680
$
—
$
15,680
Commercial paper
—
33,005
—
33,005
Corporate bonds
—
79,509
—
79,509
US government and agency obligations
—
18,906
—
18,906
Asset backed securities
—
13,063
—
13,063
Treasury bills
—
40,551
—
40,551
Mutual funds
3,358
—
—
3,358
Total assets measured at fair
value
$
3,358
$
200,714
$
—
$
204,072
May 28, 2022
Level 1
Level 2
Level 3
Balance
Assets
Municipal bonds
$
—
$
10,104
$
—
$
10,104
Commercial paper
—
14,868
—
14,868
Corporate bonds
—
73,684
—
73,684
Certificates of deposits
—
1,245
—
1,245
US government and agency obligations
—
2,209
—
2,209
Asset backed securities
—
13,319
—
13,319
Mutual funds
3,752
—
—
3,752
Total assets measured at fair
value
$
3,752
$
115,429
$
—
$
119,181
Investment
securities
–
available-for-sale
classified
as Level
2
consist
of
securities
with maturities
of
three
months
or longer
when purchased. We
classified these securities as
current because amounts
invested are readily available
for current operations.
Observable inputs for these securities are yields, credit risks, default rates, and volatility.
Note 4 - Inventories
Inventories consisted of the following as of November 26, 2022
and May 28, 2022 (in thousands):
November 26, 2022
May 28, 2022
Flocks, net of amortization
$
156,782
$
144,051
Eggs and egg products
28,343
26,936
Feed and supplies
95,457
92,329
$
280,582
$
263,316
We
grow
and
maintain
flocks
of
layers
(mature
female
chickens),
pullets
(female
chickens,
under
18
weeks
of
age),
and
breeders
(male
and
female
chickens
used
to
produce
fertile
eggs
to
hatch
for
egg
production
flocks).
Our
total
flock
at
November 26,
2022 and
May 28,
2022 consisted
of approximately
10.4
million and
11.5
million pullets
and breeders
and
43.7
million and
42.2
million layers, respectively.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
8
quarter for
which the
Company reports net
income attributable
to Cal-Maine
Foods, Inc.
computed in
accordance with
GAAP
in an amount equal
to one-third (
1/3
) of such quarterly
income. Dividends are paid
to shareholders of record as
of the 60th day
following the last
day of such
quarter, except
for the fourth
fiscal quarter.
For the fourth
quarter, the
Company pays dividends
to shareholders of record on the 65th day after the quarter end. Dividends are payable on the 15th day following the record date.
Following a quarter for which the Company does not report net income attributable to Cal-Maine Foods, Inc., the Company will
not pay a dividend for a subsequent
profitable quarter until the Company is profitable on
a cumulative basis computed from the
date of the most recent quarter for which a dividend was paid. The dividend policy is subject to periodic review by the Board of
Directors.
New Accounting Pronouncements and Policies
No new accounting pronouncement issued or effective during the fiscal year had or is expected to have a material impact on our
Consolidated Financial Statements.
Note 2 - Investment
Securities
The following represents the Company’s investment securities as of September 2, 2023 and June 3, 2023 (in thousands):
September 2, 2023
Amortized
Cost
Unrealized
Gains
Unrealized
Losses
Estimated
Fair Value
Municipal bonds
$
7,915
$
—
$
150
$
7,765
Commercial paper
8,913
—
15
8,898
Corporate bonds
128,031
—
1,090
126,941
Certificates of deposits
1,125
—
8
1,117
US government and agency obligations
94,584
—
320
94,264
Asset backed securities
10,683
—
49
10,634
Total current investment securities
$
251,251
$
—
$
1,632
$
249,619
Mutual funds
$
2,181
$
—
$
53
$
2,128
Total noncurrent investment securities
$
2,181
$
—
$
53
$
2,128
June 3, 2023
Amortized
Cost
Unrealized
Gains
Unrealized
Losses
Estimated
Fair Value
Municipal bonds
$
16,571
$
—
$
275
$
16,296
Commercial paper
56,486
—
77
56,409
Corporate bonds
139,979
—
1,402
138,577
Certificates of deposits
675
—
—
675
US government and agency obligations
101,240
—
471
100,769
Asset backed securities
13,459
—
151
13,308
Treasury bills
29,069
—
13
29,056
Total current investment securities
$
357,479
$
—
$
2,389
$
355,090
Mutual funds
$
2,172
$
—
$
91
$
2,081
Total noncurrent investment securities
$
2,172
$
—
$
91
$
2,081
Available-for-sale
Proceeds from sales and maturities of
investment securities available-for-sale were $
135.8
million and $
20.3
million during the
thirteen weeks
ended September 2,
2023 and
August 27,
2022, respectively.
Gross realized
gains for
the thirteen
weeks ended
September 2,
2023
and August
27,
2022 were
$
2
thousand. Gross realized
losses for
the
thirteen weeks
ended September
2,
2023
and
August
27,
2022
were
$
8
thousand
and
$
27
thousand,
respectively.
There
were
no
allowances
for
credit
losses
at
September 2, 2023 and June 3, 2023.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
119
Note 5 - Equity
The following reflectsActual maturities may differ
 
equity activity forfrom contractual maturities as
some borrowers have
 
the thirteen andright to call
 
twenty-six weeks endedor prepay obligations
 
November 26, 2022
and November 27,
2021with or
(inwithout penalties. Contractual maturities of current investments at September 2, 2023 are as follows (in thousands):
Thirteen Weeks
Ended November 26, 2022Estimated Fair Value
Cal-Maine Foods, Inc. StockholdersWithin one year
Common Stock$
Class A175,963
Treasury1-5 years
Paid In
Accum. Other
Retained
Noncontrolling
Amount
Amount
Amount
Capital
Comp. Loss
Earnings
Interest73,656
Total
Balance at August
27, 2022
$
703
$
48
$
(28,495)
$
69,017
$
(2,350)
$
1,149,399
$
(359)
$
1,187,963
Other comprehensive
loss, net of tax
—
—
—
—
(737)
—
—
(737)
Stock compensation
plan transactions
—
—
(1)
988
—
—
—
987
Dividends ($
1.353
per share)
Common
—
—
—
—
—
(59,708)
—
(59,708)
Class A common
—
—
—
—
—
(6,494)
—
(6,494)
Net income (loss)
—
—
—
—
—
198,587
(293)
198,294
Balance at November
26, 2022
$
703
$
48
$
(28,496)
$
70,005
$
(3,087)
$
1,281,784
$
(652)
$
1,320,305249,619
Thirteen WeeksNoncurrent
 
Ended November 27, 2021
Cal-Maine Foods, Inc. StockholdersThere
were
Common Stockno
Class
sales of
noncurrent
investment securities
during
the
thirteen weeks
ended September
2,
2023
and August
27,
2022.
Note 3 - Fair Value Measurements
The Company
is required
to categorize
both financial
and nonfinancial
assets and
liabilities based
on the
following fair
value
hierarchy. The
fair value
of an
asset is
the price
at which
the asset
could be
sold in
an orderly
transaction between
unrelated,
knowledgeable, and willing parties able to engage in the
transaction. A liability’s fair value
is defined as the amount that would
Treasurybe paid
to transfer
the liability
to a
new obligor
in a
transaction between
such parties,
not
the amount
that would
be paid
to
Paid Insettle the liability with the creditor.
Accum. Other•
RetainedLevel 1
Noncontrolling
- Quoted prices in active markets for identical assets or liabilities
Amount•
AmountLevel 2
Amount
- Inputs
other than
quoted prices
included in
Level 1
that are
observable for
the asset
or liability,
either
Capitaldirectly or indirectly, including:
Comp. Loss◦
EarningsQuoted prices for similar assets or liabilities in active markets
Interest◦
TotalQuoted prices for identical or similar assets in non-active markets
◦
Inputs other than quoted prices that are observable for the asset or liability
◦
Inputs derived principally from or corroborated by other observable market data
•
Level 3
- Unobservable inputs for the asset or liability that are supported by little or no market activity and that are
significant to the fair value of the assets or liabilities
The disclosures of fair value of certain financial assets and liabilities that are recorded at cost are as follows:
Cash and cash equivalents, accounts receivable, and accounts payable:
The carrying amount approximates fair value due to the
short maturity of these instruments.
Assets and Liabilities Measured at Fair Value
on a Recurring Basis
In
accordance with
the
fair value
hierarchy described
above, the
following
table shows
the
fair
value of
financial assets
and
liabilities measured at fair value on a recurring basis as of September 2, 2023 and June 3, 2023 (in thousands):
September 2, 2023
Level 1
Level 2
Level 3
Balance at August
28, 2021Assets
$
703
$
48
$
(27,451)
$
65,044
$
(728)
$
957,951Municipal bonds
$
—
$
995,5677,765
Other comprehensive$
loss, net—
$
7,765
Commercial paper
—
8,898
—
8,898
Corporate bonds
—
126,941
—
126,941
Certificates of taxdeposits
—
1,117
—
1,117
US government and agency obligations
—
94,264
—
94,264
Asset backed securities
—
10,634
—
10,634
Mutual funds
2,128
—
—
—2,128
Total assets measured at fair value
$
2,128
$
249,619
$
—
(268)
—
—
(268)
Stock compensation
plan transactions
—
—
1
975
—
—
—
976
Contributions
—
—
—
—
—
—
3
3
Net income (loss)
—
—
—
—
—
1,173
(28)
1,145
Balance at
November 27, 2021
$
703
$
48
$
(27,450)
$
66,019
$
(996)
$
959,124
$
(25)
$
997,423251,747
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1210
Twenty-six WeeksJune 3, 2023
Level 1
Level 2
Level 3
Balance
Assets
Municipal bonds
$
—
$
16,296
$
—
$
16,296
Commercial paper
—
56,409
—
56,409
Corporate bonds
—
138,577
—
138,577
Certificates of deposits
—
675
—
675
US government and agency obligations
—
100,769
—
100,769
Asset backed securities
—
13,308
—
13,308
Treasury bills
—
29,056
—
29,056
Mutual funds
2,081
—
—
2,081
Total assets measured at fair value
$
2,081
$
355,090
$
—
$
357,171
Investment securities
 
–
available-for-sale
classified as
Level 2
consist of
securities with
maturities of
three months
or longer
when purchased. We
classified these securities as current because amounts invested are readily available
for current operations.
Observable inputs for these securities are yields, credit risks, default rates, and volatility.
Note 4 - Inventories
Inventories consisted of the following as of September 2, 2023 and June 3, 2023 (in thousands):
September 2, 2023
June 3, 2023
Flocks, net of amortization
$
165,138
$
164,540
Eggs and egg products
27,604
28,318
Feed and supplies
88,059
91,560
$
280,801
$
284,418
We
grow
and
maintain
flocks
of
layers
(mature
female
chickens),
pullets
(female
chickens,
under
18
weeks
of
age),
and
breeders
(male
and
female
chickens
used
to
produce
fertile
eggs
to
hatch
for
egg
production
flocks).
Our
total
flock
at
September 2,
2023 and
June 3,
2023 consisted
of approximately
10.0
million and
10.8
million pullets
and breeders
and
41.9
million and
41.2
million layers, respectively.
Note 5 - Equity
The following reflects equity activity for the thirteen weeks ended September 2, 2023 and August 27, 2022 (in thousands):
Thirteen Weeks Ended November 26, 2022September 2, 2023
Cal-Maine Foods, Inc. Stockholders
Common Stock
Class A
Treasury
Paid In
Accum. Other
Retained
Noncontrolling
Amount
Amount
Amount
Capital
Comp. Loss
Earnings
Interest
Total
Balance at May 28,June 3,
20222023
$
703
$
48
$
(28,447)(30,008)
$
67,98972,112
$
(1,596)(2,886)
$
1,065,8541,571,112
$
(206)(1,498)
$
1,104,3451,609,583
Other comprehensive
loss,income, net of tax
—
—
—
—
(1,491)595
—
—
(1,491)595
Stock compensation
plan transactions
—
—
(49)(6)
2,0161,041
—
—
—
1,9671,035
Dividends ($
2.2060.006
per share)
Common
—
—
—
—
—
(97,355)(265)
—
(97,355)(265)
Class A common
—
—
—
—
—
(10,589)(29)
—
(10,589)(29)
Net income (loss)
—
—
—
—
—
323,874926
(446)(515)
323,428411
Balance at
November 26, 2022September 2, 2023
$
703
$
48
$
(28,496)(30,014)
$
70,00573,153
$
(3,087)(2,291)
$
1,281,7841,571,744
$
(652)(2,013)
$
1,320,3051,611,330
Twenty-six Weeks
Ended November 27, 2021
Cal-Maine Foods, Inc. Stockholders
Common Stock
Class A
Treasury
Paid In
Accum. Other
Retained
Noncontrolling
Amount
Amount
Amount
Capital
Comp. Loss
Earnings
Interest
Total
Balance at May 29,
2021
$
703
$
48
$
(27,433)
$
64,044
$
(558)
$
975,977
$
—
$
1,012,781
Other comprehensive
loss, net of tax
—
—
—
—
(438)
—
—
(438)
Stock compensation
plan transactions
—
—
(17)
1,975
—
—
—
1,958
Contributions
—
—
—
—
—
—
3
3
Net loss
—
—
—
—
—
(16,853)
(28)
(16,881)
Balance at November
27, 2021
$
703
$
48
$
(27,450)
$
66,019
$
(996)
$
959,124
(25)
$
997,423
Note 6 - Net Income (Loss) per Common Share
Basic net
income (loss)
per share
is based
on the
weighted average
Common Stock
and Class
A Common
Stock outstanding.
Diluted net income
per share
is based on
weighted-average common
shares outstanding
during the
relevant period
adjusted for
the
dilutive
effect
of share-based
awards.
Restricted
shares
of
145
thousand
were
antidilutive
due
to
the net
loss for
the first
twenty-six weeks of fiscal 2022. These shares were not included in the diluted net
loss per share calculation.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1311
Thirteen Weeks Ended August 27, 2022
Cal-Maine Foods, Inc. Stockholders
Common Stock
Class A
Treasury
Paid In
Accum. Other
Retained
Noncontrolling
Amount
Amount
Amount
Capital
Comp. Loss
Earnings
Interest
Total
Balance at May 28,
2022
$
703
$
48
$
(28,447)
$
67,989
$
(1,596)
$
1,065,854
$
(206)
$
1,104,345
Other comprehensive
loss, net of tax
—
—
—
—
(754)
—
—
(754)
Stock compensation
plan transactions
—
—
(48)
1,028
—
—
—
980
Dividends ($
0.853
per share)
Common
—
—
—
—
—
(37,648)
—
(37,648)
Class A common
—
—
—
—
—
(4,094)
—
(4,094)
Net income (loss)
—
—
—
—
—
125,287
(153)
125,134
Balance at August
27, 2022
$
703
$
48
$
(28,495)
$
69,017
$
(2,350)
$
1,149,399
$
(359)
$
1,187,963
Note 6 - Net Income per Common Share
Basic net income per
share is based on
the weighted average Common Stock
and Class A Common
Stock outstanding. Diluted
net
income
per
share
is
based
on
weighted-average
common
shares
outstanding
during
the
relevant
period
adjusted
for
the
dilutive effect of share-based awards.
The
 
following
 
table
 
provides
 
a
 
reconciliation
 
of
 
the
 
numerators
 
and
 
denominators
 
used
 
to
 
determine
 
basic
 
and
 
diluted
 
net
income (loss) per common share (amounts in thousands, except per share data):
Thirteen Weeks
Ended
Twenty-six Weeks
EndedSeptember 2, 2023
November 26,
August 27, 2022
November 27,
2021
November 26,
2022
November 27,
2021
Numerator
Net income (loss)
$
198,294411
$
1,145
$
323,428
$
(16,881)125,134
Less: Loss attributable to noncontrolling
interest
(293)(515)
(28)
(446)
(28)(153)
Net income (loss) attributable to Cal-
MaineCal-Maine Foods, Inc.
$
198,587926
$
1,173
$
323,874
$
(16,853)125,287
Denominator
Weighted-average
common shares
outstanding, basic
48,62448,690
48,857
48,624
48,85948,623
Effect of dilutive restricted shares
216150
159
203
—188
Weighted-average
common shares
outstanding, diluted
48,840
49,016
48,827
48,85948,811
Net income (loss) per common share
attributable to Cal-Maine Foods, Inc.
Basic
$
4.080.02
$
2.58
Diluted
$
0.02
$
6.66
$
(0.34)
Diluted
$
4.07
$
0.02
$
6.63
$
(0.34)2.57
Note 7 –- Revenue from Contracts with Customers
Satisfaction of Performance Obligation
The vast majority of the Company’s
revenue is derived from agreements with customers based on the customer
placing an order
for products. Pricing for
 
for the most part is
 
is determined when
the Company and
 
the customer agree upon the
 
upon the specific
order, which
establishes the contract for that order.
Revenues are
 
recognized in
 
an amount
 
that reflects
 
the net
 
consideration we
 
expect to
 
receive in
 
exchange for
 
the goods.
 
Our
shell
 
eggs
 
are
 
sold
 
at
 
prices
 
related
 
to
 
independently
 
quoted
 
wholesale
 
market
 
prices
 
or
 
formulas
 
related
 
to
 
our
 
costs
 
of
12
production.
 
The
 
Company’s
 
sales
 
predominantly
 
contain
 
a
 
single
 
performance
 
obligation.
 
We
 
recognize
 
revenue
 
upon
satisfaction
 
of
 
the
 
performance
 
obligation
 
with
 
the
 
customer
 
which
 
typically
 
occurs
 
within
 
days
 
of
 
the
 
Company
 
and
 
the
customer agreeing upon the order.
Returns and Refunds
Some of our contracts
include a guaranteed sale
clause, pursuant to which
we credit the customer’s
account for product
that the
customer
is
unable
to
sell
before
expiration.
The
Company
records
an
allowance
for
expected customer returns
and
refunds
by
using
historical
return
data
and
comparing
to current
period
sales and
accounts receivable.
The allowance
is recorded
as a
reduction
of sales in sales
with a corresponding reduction in trade accounts receivable.the same period the revenue is recognized.
Sales Incentives Provided to Customers
The
 
Company
 
periodically
 
provides
 
incentive
 
offers
 
to
 
its
 
customers
 
to
 
encourage
 
purchases.
 
Such
 
offers
 
include
 
current
discount offers (e.g.,
 
(e.g., percentage
discounts off
 
current purchases), inducement offers
 
offers (e.g.(e.g.,
offers for
 
future discounts subject
 
to
a minimum
 
current purchase),
 
and other
 
similar offers.
 
Current discount
 
offers, when
accepted by
customers, are
treated as
a
reduction to
the sales
price of
the related
transaction, while
inducement offers,
 
when accepted
 
by customers,
 
are treated
 
as a
reduction
 
to
 
the sales
 
price
 
of thebased
 
related
transaction,
while inducement
offers,
when
accepted
by customers,
are
treated
as
a
reduction
to the
sales price
based on
 
estimated
future
 
redemption
rates.
 
Redemption
 
rates
are
 
estimated
using
 
the
Company’s
historical
experience
 
for
similar
 
inducement
offers.
 
Current discount
 
and
inducement
 
offers
 
are
presented
 
as a
 
net amount
 
in
‘‘Net sales.’’
14
Disaggregation of Revenue
The following table provides revenue disaggregated by product category
(in (in thousands):
Thirteen Weeks
Ended
Twenty-six Weeks
EndedSeptember 2, 2023
November 26,August 27, 2022
November 27, 2021
November 26, 2022
November 27, 2021
Conventional shell egg sales
$
541,917225,280
$
221,142
$
967,506
$
403,172425,589
Specialty shell egg sales
227,778208,681
146,917
428,598
279,375200,820
Egg products
28,05222,223
11,401
55,692
20,76727,640
Other
3,9533,160
2,263
8,248
3,3954,295
$
801,700459,344
$
381,723
$
1,460,044
$
706,709658,344
Contract Costs
The Company can incur costs to
obtain or fulfill a contract with a customer.
 
customer. If the
amortization period of these costs is less
than
one year,
 
they are
 
expensed as
 
incurred. When
 
the amortization
 
period is
 
greater than
 
one year,
 
a contract
 
asset is
 
recognized
and is amortized
 
amortized over
the contract
 
life as a
 
a reduction
in net
 
sales. As of
 
November 26, 2022of September
2, 2023
 
and May 28,June
 
2022, 3, 2023,
the balance
 
for
contract assets was immaterial.
Contract Balances
The Company receives payment from customers based on specified terms that are
generally less than 30 days from delivery.
There are rarely contract assets or liabilities related to performance under
the contract.
Note 8 - Stock Based Compensation
Total
 
stock-based compensation
expense was
$
2.0
million for
the twenty-six
weeks ended
November 26,
2022 and
November
27, 2021.
Unrecognized
 
compensation
 
expense
 
as awas
 
result$
1.0
 
of nonmillion
 
-vested
shares
of
restricted
stock outstanding
underfor
 
the
 
thirteen
weeks
ended
September
2,
2023
and
August
27,
2022.
Unrecognized compensation
expense as
a result
of non-vested
shares of
restricted stock
outstanding under
the Amended
 
and
Restated
 
2012
 
Omnibus
 
Long-Term
 
Incentive
 
Plan
 
at
 
NovemberSeptember
 
26,2,
 
20222023
 
of
 
$
4.96.1
 
million
 
will
 
be
 
recorded
 
over
 
a
 
weighted
average period of
1.81.9
 
years. Refer to Part II
 
II Item 8,
Notes to Consolidated
 
Financial Statements and
Supplementary Data, Note
16:14 - Stock Compensation Plans in our 20222023 Annual Report for further information
on our stock compensation plans.
13
The Company’s restricted share activity
for the twenty-sixthirteen weeks ended November 26, 2022September 2, 2023 follows:
Number of
Shares
Weighted
Average Grant
Date Fair Value
Outstanding, May 28, 2022June 3, 2023
317,844294,140
$
39.1243.72
Vested
(3,240)(305)
38.3137.70
Forfeited
(4,200)(1,329)
39.4444.68
Outstanding, November 26, 2022September 2, 2023
310,404292,506
$
39.1243.72
Note 9 - Commitments and Contingencies
Financial Instruments
The
Company
maintained
standby
letters
of credit
(“LOCs”)
totaling
$
4.1
million
at
November
26, 2022,
which
were issued
under
the
Company's
senior
secured
revolving
credit
facility.
The
outstanding
LOCs
are
for
the
benefit
of
certain
insurance
companies and are not recorded as a liability on the consolidated balance sheets.
15
LEGAL PROCEEDINGS
State of Texas v.
 
v. Cal-Maine Foods, Inc. d/b/a Wharton;
and Wharton County Foods, LLC
 
On April 23,
 
23, 2020,
the Company
 
and its subsidiary
 
Wharton County Foods,
 
Foods, LLC (“WCF”) were
 
were named as defendants
 
as defendants in
State
of
 
Texas
 
v.
 
Cal-Maine
Foods,
 
Inc.
d/b/a
 
Wharton;
and
 
Wharton
County
 
Foods,
LLC,
 
Cause
No.
 
2020-25427,
 
in
the
 
District
Court of
 
Harris County,
 
Texas.
 
The State
 
of Texas
 
(the “State”)
 
asserted claims
 
based on
 
the Company’s
 
and WCF’s
 
alleged
violation
 
of
 
the
 
Texas
 
Deceptive
 
Trade
 
Practices—Consumer
 
Protection
 
Act,
 
Tex.
 
Bus.
 
&
 
Com.
 
Code
 
§§
 
17.41-17.63
(“DTPA”).
 
The
 
State
 
claimed
 
that
 
the
 
Company
 
and
 
WCF
 
offered
 
shell
 
eggs
 
at
 
excessive
 
or
 
exorbitant
 
prices
 
during
 
the
COVID-19
 
state
 
of
 
emergency
 
and
 
made
 
misleading
 
statements
 
about
 
shell
 
egg
 
prices.
 
The
 
State
 
sought
 
temporary
 
and
permanent
 
injunctions
 
against
 
the
 
Company
 
and
 
WCF
 
to
 
prevent
 
further
 
alleged
 
violations
 
of
 
the
 
DTPA,
 
along
 
with
 
over
$
100,000
 
in damages. On August 13, 2020, the court granted the defendants’ motion to dismiss the State’s
original petition with
prejudice. On September 11,
 
11, 2020,
the State filed a
 
notice of appeal, which was
 
which was assigned to
the Texas
 
Court of Appeals
for the
First
 
District.
 
On
 
August
 
16,
 
2022,
 
the
 
appeals
 
court
 
reversed
 
and
 
remanded
 
the
 
case
 
back
 
to
 
the
 
trial
 
court
 
for
 
further
proceedings. On October
31, 2022, the Company
and WCF filed aappealed the First District Court’s
 
petition for reviewdecision to the Supreme Court of
Texas.
On September 29, 2023,
 
the Supreme Court ofdenied
 
Texasthe Company’s
 
appealingPetition for Review so
the case will be
remanded to
the
First District
court’s
decision.
On November
30,
2022, the
State of
Texas
waived
its response
to defendant’s
petition
trial court for
review. The court
has not issued a ruling. further proceedings. Management believes the risk of material loss related to this matter to be
 
to be remote.
Bell et al. v. Cal-Maine Foods et al.
 
On
April
 
30, 2020,
 
the Company
 
was named
 
as one
 
of several
 
defendants
in
 
Bell et
 
al. v.
 
Cal-Maine Foods
 
Foods et
al.,
 
Case No.
1:20-cv-461,
 
in
 
the
 
Western
 
District
 
of
 
Texas,
 
Austin
 
Division.
 
The
 
defendants
 
include
 
numerous
 
grocery
 
stores,
 
retailers,
producers, and farms. Plaintiffs assert that defendants
violated the DTPA
 
by allegedly demanding exorbitant or
excessive prices
for eggs
 
eggs during
the
 
COVID-19 state
 
state of
emergency.
 
Plaintiffs
 
request
certification
 
of a
 
class of
 
all consumers
 
who purchased
eggs
 
in
 
Texas
 
sold,
 
distributed,
 
produced,
 
or
 
handled
 
by
 
any
 
of
 
the
 
defendants
 
during
 
the
 
COVID-19
 
state
 
of
 
emergency.
Plaintiffs seek to enjoin
the Company and other
 
other defendants from selling eggs
at a price more than
 
than 10% greater than the price
of
eggs prior
 
to the
 
declaration of
the state
 
of the
state of
emergency
 
and damages
 
in the
 
amount of
 
of $
10,000
 
per violation,
 
or $
250,000
 
for
each violation
 
impacting anyone
 
over 65
 
years old.
 
On December
 
1, 2020,
 
the Company
 
and certain
 
certain other defendants
 
defendants filed
a
motion to
 
dismiss the
 
plaintiffs’
amended
 
class action
 
complaint. The
 
plaintiffs subsequently
 
subsequently filed a
 
a motion to
 
to strike, and
 
and the
motion to
 
dismiss and
 
related proceedings were
 
were referred to
 
to a United
 
United States magistrate
 
magistrate judge. On
 
On July 14,
 
14, 2021, the
 
the magistrate
judge
 
issued
 
a
 
report
 
and
 
recommendation
 
to
 
the
 
court
 
that
 
the
 
defendants’
 
motion
 
to
 
dismiss
 
be
 
granted
 
and
 
the
 
case
 
be
dismissed without prejudice for lack of subject matter jurisdiction. On
September 20, 2021, the court dismissed the case without
prejudice.
 
On
 
July
 
13,
 
2022,
 
the
 
court
 
denied
 
the
 
plaintiffs’
 
motion
 
to
 
set
 
aside
 
or
 
amend
 
the
 
judgment
 
to
 
amend
 
their
complaint.
On March 15, 2022, plaintiffs
 
plaintiffs filed a
second suit against the
 
Company and several
defendants in Bell et
 
al. v.
 
Cal-Maine Foods
et al.,
 
Case No.
 
1:22-cv-246, in
 
the Western
 
District of
 
Texas,
 
Austin Division
 
alleging the
 
same assertions
 
as laid
 
out in
 
the
first
 
complaint.
On
 
August
 
12,
 
2022,
 
the
Company
 
and
other
 
defendants
in
 
the
 
case
 
filed
 
a
 
motion
 
to
dismiss
 
the
plaintiffs’
class action
 
complaint. On January
 
September 6,
2022,9, 2023, the
 
plaintiffs’ filedcourt entered
 
their oppositionan order and
 
to final judgement granting
the Company’s
 
motion to
dismiss.
 
dismiss and
On February
8, 2023,
 
the Company
and otherplaintiffs
 
defendants filedappealed the
 
their replylower court’s
 
on September
13, 2022.
On December
7, 2022,
the magistrate
judge issued
a report
and
recommendationjudgement to
 
the court thatUnited
 
the defendants’ motionStates Court
 
to dismiss beof Appeals
 
granted andfor the
 
case be dismissedFifth
Circuit, Case No. 23-50112.
 
without prejudice for
lackThe parties filed their respective
 
ofappellate briefs, but the court
 
subject
matter
jurisdiction.
On
December
21,
2022,
the
plaintiffs
filed
Objections
to
the
Magistrate’s
Report
and
Recommendation, but the
court has not issued aruled on
 
ruling. these submissions.
Management believes
the risk of material loss
related to both matters
to
be remote.
14
Kraft Foods Global, Inc. et al. v.
United Egg Producers, Inc. et al.
 
As previously
 
reported, on
 
September 25,
 
2008, the
 
Company was
 
was named as
 
as one of
 
of several
defendants
 
in numerous
 
antitrust
cases involving
 
the United
 
States shell
 
egg
industry.
 
The Company
 
settled all
 
of these
 
cases, except
 
for the
 
the claims of
 
of certain
plaintiffs who sought substantial
damages allegedly arising from
the purchase of egg
products (as
opposed to shell eggs). These
remaining plaintiffs are
 
are Kraft
Food Global,
 
Inc., General
Mills, Inc.,
 
and Nestle
USA, Inc.
 
(the “Egg
Products Plaintiffs”)
 
and,
until a subsequent settlement was reached as described below, The Kellogg Company.
On September
 
13, 2019,
 
the case
 
with the
 
Egg Products
 
Plaintiffs was
 
remanded from
 
a multi-district
 
litigation proceeding
 
in
the
 
United
 
States
 
District
 
Court
 
for
 
the
 
Eastern
 
District
 
of
 
Pennsylvania,
 
In
 
re
 
Processed
 
Egg
 
Products
 
Antitrust
 
Litigation,
MDL No. 2002, to
the United States District Court for
 
for the Northern District
of Illinois, Kraft Foods Global, Inc. et
 
Inc. et al. v.
United
Egg
 
Producers,
 
Inc.
 
et
 
al.,
 
Case
 
No.
 
1:11-cv-8808,
 
for
 
trial.
 
The
 
Egg
 
Products
 
Plaintiffs
 
allege
 
that
 
the
 
Company
 
and
 
other
defendants
 
violated
 
Section
 
1
 
of
 
the
 
Sherman
 
Act,
 
15.
 
U.S.C.
 
§
 
1,
 
by
 
agreeing
 
to
 
limit
 
the
 
production
 
of
 
eggs
 
and
 
thereby
illegally to raise the prices that plaintiffs
paid for processed egg products. In particular,
the Egg Products Plaintiffs are
attacking
certain features of the United
 
the United Egg
Producers animal-welfare guidelines and program
 
and program used by
the Company and many
 
many other egg
producers. The Egg
 
Egg Products Plaintiffs
 
Plaintiffs seek to
 
to enjoin the
 
the Company
and other
 
defendants from engaging
 
engaging in
antitrust violations
16
and seek treble money damages.
On May 2, 2022, the court
 
the court set trial for October
24, 2022, but on September 20, 2022,
 
20, 2022, the court
cancelled the
trial date
due to
COVID-19 protocols
and converted
the trial
date to
a status
hearing to
reschedule the
jury trial.
On
December
8,
2022,
the
court
held
a
status
hearing.
The
parties
subsequently
submitted
an
updated
proposed
pre-trial
schedule and the Court has set the trial date to a status hearing
to reschedule the jury trial. A
preliminary pre-trial order was filed by the parties on August 22, 2023, and trial is now set for October 16,17, 2023.
In addition,
 
on October
 
24, 2019,
 
the Company
 
entered into
 
a confidential
 
settlement agreement
 
with The
 
Kellogg Company
dismissing
 
all
 
claims
 
against
 
the
 
Company
 
for
 
an
 
amount
 
that
 
did
 
not
 
have
 
a
 
material
 
impact
 
on
 
the
 
Company’s
 
financial
condition or results of operations. On November 11,
2019, a stipulation for dismissal was filed with the court,
and on March 28,
2022, the court dismissed the Company with prejudice.
The Company intends to
continue to defend the remaining
case with the Egg Products Plaintiffs
 
as vigorously as possible
based
on
 
defenses
 
which
 
the
 
Company
 
believes
 
are
 
meritorious
 
and
 
provable.
 
Adjustments,
 
if
 
any,
 
which
 
might
 
result
 
from
 
the
resolution of
 
this remaining
 
matter with
 
the Egg
 
Products Plaintiffs
 
have not
 
been reflected
 
in the
 
financial statements.
 
While
management
 
believes
 
that
 
there
 
is
 
still
 
a
 
reasonable
 
possibility
 
of
 
a
 
material
 
adverse
 
outcome
 
from
 
the
 
case
 
with
 
the
 
Egg
Products Plaintiffs,
 
at the present
 
present time, it is
 
it is not
possible to
 
estimate the amount
 
amount of
monetary exposure,
 
if any,
 
to the
Company
due
 
to
 
a
range
 
of
 
factors,
including
 
the
following,
 
among
others:
 
two
earlier
 
trials
based
 
on
 
substantially
the
 
same
facts
 
and
legal arguments
 
resulted in
 
in findings of
 
of no
conspiracy
 
and/or damages;
 
this trial
 
will be
 
before a
 
a different judge
 
judge and
jury
 
in a
different
 
court
than
 
prior related
 
cases; there
 
are significant
 
factual issues
 
issues to
be
 
resolved; and
 
there are
 
are requests for
 
for damages
other than compensatory damages (i.e., injunction and treble money damages).
State of Oklahoma Watershed Pollution
Litigation
On June 18,
 
18, 2005, the
State of Oklahoma
filed suit, in
the United States
District Court for
the Northern District
of Oklahoma,
against Cal-Maine
Foods, Inc.
and Tyson
Foods, Inc.,
Cobb-Vantress,
Inc., Cargill,
Inc., George’s,
Inc., Peterson
Farms, Inc.
and
Simmons Foods,
Inc.,
and
certain
of
their affiliates.
The
 
State of
 
Oklahoma filedclaims
 
suit, inthat
 
the United
States District
Court for
the Northern
District of
Oklahoma,
against Cal-Maine Foods, Inc. and
Tyson Foods,
Inc. and affiliates, Cobb-Vantress,
Inc., Cargill, Inc. and its
affiliate, George’s,
Inc. and
its affiliate,
Peterson Farms, Inc.
and Simmons Foods,
Inc. The
State of Oklahoma
claims that through
 
the disposal of
chicken
 
of
chicken
litter the
defendants have
 
polluted the Illinois
 
Illinois River
Watershed.
 
This watershed
provides
 
water to eastern
 
eastern Oklahoma.
The complaint
sought
 
seeks injunctive relief
 
relief and
 
monetary damages,
 
but
the
 
claim for
 
monetary damages
 
has beenwas
 
dismissed by
 
the
court.
 
court. Cal-Maine
Foods,
 
Inc.
 
discontinued
 
operations
 
in
 
the
 
watershed.watershed
 
Accordingly,in
 
weor
 
doaround
 
not2005.
 
anticipate
that
Cal-Maine
Foods,
Inc.
will
be
materially
affected
bySince
 
the
 
requestlitigation
 
forbegan,
 
injunctiveCal-Maine
 
reliefFoods,
 
unlessInc.
purchased
100
%
of
 
the
 
courtmembership
 
ordersinterests
 
substantialof
 
affirmativeBenton
County
Foods,
LLC,
which
is
an
ongoing
commercial
shell
egg
remediation. Sinceoperation within
 
the litigationIllinois
 
began, Cal-Maine
Foods, Inc.
purchased
100
% of the
membership interests
of Benton
County
Foods, LLC,
which is
an ongoing
commercial shell
egg operation
within the
Illinois River
Watershed.
 
Benton County
 
Foods, LLC
LLC is not
a defendant
in the
litigation. We
also have
a
number of small contract producers that operate in the litigation.area.
15
The non-jury trial in the case
began in September 2009 and
concluded in February 2010. On January 18, 2023, the court entered
findings of fact
and conclusions of
law in favor
of the State
of Oklahoma, but
no penalties were
assessed. The court
found the
defendants
liable
for
state
law
nuisance,
federal
common
law
nuisance,
and
state
law
trespass.
The
court
also
found
the
producers
vicariously
liable for
the
actions of
their
contract producers.
The
court directed
the
parties
to
confer
in attempt
to
reach agreement
on appropriate
remedies. On
June 12,
2023, the
court ordered
the parties
to mediate
before the
Tenth
Circuit
Chief
Judge
Deanell
Reece
Tacha
and
instructed
the
parties
to
file
a
joint
status
report
14
days
following
mediation.
While
management believes there
is a
reasonable possibility of
a material loss
from the
 
case, was tried without a jury,at
 
and the courtpresent
time, it
is not
possible to
has not yet issued its ruling. Management believesestimate the risk
amount of material loss related
monetary exposure,
if any,
 
to this matter the
Company due
to a
range of
factors, including
the following,
among
others: uncertainties inherent in any
assessment of potential costs associated
with injunctive relief or
other penalties based on
a
decision in a case tried
over 13 years ago based
on environmental conditions that existed at
the time, the lack of
guidance from
the
court
as
to
what
might
be
considered
appropriate
remedies,
the
ongoing
negotiations
and
mediation
with
the
State
of
Oklahoma, and uncertainty regarding what our proportionate share
of any remedy would be, remote.although
we believe that our share
compared to the other defendants is small.
Other Matters
In addition to
the above, the Company
is involved in
various other claims
and litigation incidental
to its business.
Although the
outcome of
these matters
cannot be
determined with
certainty,
management, upon
the advice
of counsel,
is of
the opinion
that
the final outcome should not have a material effect on the Company’s
consolidated results of operations or financial position.
Note 10 - Subsequent Events
Effective
on
September
28,
2023,
the
Company
entered
into
a
definitive
agreement
to
acquire
substantially
all
the
assets
of
Fassio
Egg
Farms,
Inc.
(“Fassio”),
related
to
its
commercial
shell
egg
production
and
processing
business.
The
assets
to
be
acquired, subject to the completion of
this transaction, include commercial shell egg
production and processing facilities with a
current capacity
of approximately
1.2
million laying
hens, primarily
cage-free, a
feed mill,
pullets, a
fertilizer production
and
composting operation and land located in Erda, Utah, outside Salt Lake City.
1716
ITEM
 
2.
 
MANAGEMENT’S
DISCUSSION
AND
 
ANALYSIS
 
OF
 
FINANCIAL
 
CONDITION
 
AND
 
RESULTS
 
OF
OPERATIONS
The following
 
should be
 
read in
 
conjunction with
 
with Management’s
 
Discussion and
 
Analysis of
 
Financial Condition
 
and Results
of Operations included
 
in Part II Item
 
Item 7 of
the Company’s
 
Annual Report on
 
Form 10-K for its
 
its fiscal year ended May
 
28, 2022ended June 3,
2023
(the “2022“2023 Annual Report”), and the accompanying financial statements and
notes included in Part II Item 8 of the 20222023 Annual
Report and in
 
of this Quarterly Report on Form 10-Q (“Quarterly Report”).
This
 
report
contains
 
numerous
forward-looking
 
statements
within
 
the
meaning
 
of
 
Section
27A
 
of
 
the
Securities
 
Act
of
 
1933
(the “Securities
 
Act”) and
 
Section 21E
 
of the
 
Securities Exchange Act
 
Act of 1934
 
1934 (the(the “Exchange
 
“Exchange Act”) relating
 
relating to our
 
our shell
egg
business,
 
including
 
estimated
 
future
 
production
 
data,
 
expected
 
construction
 
schedules,
 
projected
 
construction
 
costs,
 
potential
future
supply
 
of and
 
and demand
 
for
our
 
products,
potential
 
future
corn
 
and soybean
 
soybean price
trends,
 
potential
future
 
impact
on
 
our
business
 
of
 
theinflation
 
COVID-19and
 
pandemic,rising
interest
rates,
 
potential
 
future
 
impact
 
on
 
our
 
business
 
of
 
new
 
legislation,
 
rules
 
or
 
policies,
potential
 
potential
outcomes
 
of
 
legal
 
proceedings,
 
and
 
other
 
projected
 
operating
 
data,
 
including
 
anticipated
 
results
 
of
 
operations
 
and
financial
 
financial
condition.
 
Such
 
forward-looking
 
statements
 
are
 
identified
 
by
 
the
 
use
 
of
 
words
 
such
 
as
 
“believes,”
 
“intends,”
“expects,”
“hopes, “hopes,”
“may, “may,”
“should, “should,”
“plans, “plans,”
 
“projected,” “contemplates,” “anticipates,” or similar words. Actual outcomes or
results
 
“contemplates,”
“anticipates,”
or
similar
words.
Actual
outcomes
or
results
could
 
differ
 
materially
 
from
 
those
 
projected
 
in
 
the
 
forward-looking
 
statements.
The
 
forward-looking
 
statements
 
are
based
on
based on management’s
 
current
intent,
belief,
expectations,
 
estimates,
and
projections
 
regarding
the
Company
and
 
its
industry. These
These statements
are
 
not
guarantees
of
 
future
performance
and
 
involve
risks,
uncertainties,
 
assumptions,
and
other
 
factors that
are difficult to predict and may be beyond our control.
 
The factors that could cause actual results to differ materially from
 
are
difficult
to predict
and
may be
beyond
our
control. The
factors
that
could cause
actual results
to
differ
materially
from those
projected in
 
in the
forward-looking
 
statements include,
 
among others,
 
(i) the
 
risk factors
 
set forth
 
in Part
 
I Item
 
1A of
 
the 20222023
Annual
Report,
 
(ii)the risk
 
factors (if
any) set
forth in
Part II
Item 1A
Risk Factors
and elsewhere
in this
report as
well as
those
included in
other reports
we file
from time
to time
with the
 
risks
Securities and
 
hazardsExchange Commission
 
inherent
in
(the
shell egg
business “SEC”)
 
(including our
Quarterly Reports on Form 10-Q and Current Reports on Form 8-K), (ii) the risks and hazards inherent in the shell egg business
(including disease, pests,
weather
conditions,
 
and
potential
for
product recall),
 
including
but not
limited to
 
the current outbreak
outbreak
of highly
pathogenic
 
avian influenza (“HPAI”)
 
influenza
(“HPAI”)
affecting
poultry in
 
the United States
 
States (“U.S.”),
Canada and
 
other countries that
that was
first detected in commercial flocks
 
in commercial
flocks in
the
U.S. in February 2022,
 
2022, (iii) changes
in the demand
 
for and market prices of
 
prices of shell
eggs and
 
eggs and feed costs,
 
costs, (iv) our
 
ability to
predict
and
 
meet
demand
 
for
cage-free
 
and
other
 
specialty
eggs,
 
(v)
risks,
 
changes, or
or
obligations
 
that
 
could
 
result
 
from
 
our
 
future
acquisition
acquisition
of
new
 
flocks
or
businesses
and
 
risks
or
changes
 
that may cause
 
may
cause
conditions to completing
 
completing a
pending acquisition
 
not
to
 
be
met,
 
(vi)
risks
 
relating
to
 
the
evolving
COVID-19
pandemic,
including
without
limitation
increased
costs
 
and higher
 
risingand potentially
further increases in, inflation
and interest rates, which
began in response to
market conditions caused in
part by the COVID-19
pandemic and which generally have been exacerbated
 
exacerbated by Russia’s invasion of Ukraine startingthe Russia-Ukraine War
 
that began in February 2022, (vii)
our ability
to retain
 
existing customers,
 
acquire new
 
customers and
 
grow our
 
product mix
 
and (viii)
 
adverse results
 
in pending
litigation
litigation matters.
Readers
 
are
cautioned
 
not
to
 
place
undue
 
reliance on
forward-looking statements
because, while
we believe
the
assumptions
 
on
which
the
 
forward-looking
 
statements
 
arebecause,
 
while
we
believe
the
assumptions on
which the
forward-looking statements
are based
are reasonable,
there can
be no
assurance that
these forward-
looking
statements
will
prove
to
be
accurate.
Further,
forward-looking
statements
included
herein
 
are
 
reasonable,only
 
theremade
 
canas
 
beof
the
respective dates
thereof, or
if
 
no
 
assurancedate
 
thatis
 
these
forward-looking statements
will prove
to be
accurate. Further,
forward-looking statements included
herein are
only made
as of
the respective
dates thereof,
or if no
date is stated,
 
as
of
the date
 
hereof. Except as
 
otherwise requiredExcept
 
as otherwise
required by
law,
 
we disclaim
 
disclaim any
intent or obligation to update
 
to update publicly
these forward-looking statements, whether because
 
whether because of
new information, future events,
 
events, or
otherwise.
GENERAL
Cal-Maine
 
Foods,
 
Inc.
 
(the
 
“Company,”
 
“we,”
 
“us,”
 
“our”)
 
is
 
primarily
 
engaged
 
in
 
the
 
production,
 
grading,
 
packaging,
marketing
and
 
distribution
of
 
fresh
shell
 
eggs.
Our
 
operations
are
 
fully
integrated
 
underand we
 
have one
 
operating and
 
reportable
segment.
 
We
 
are
 
the
largest
 
producer
 
and
 
distributor
 
of
fresh
 
shell
 
eggs
 
in
 
the
U.S.
 
Our
 
total
 
flock
 
of
 
approximately
 
43.741.9
million
layers and
 
10.4
10.0 million pullets
 
and breeders is
 
is the largest in
 
in the U.S.
We
 
sell most of
 
our shell eggs
 
to a diverse
 
group
of customers, including
 
customers, including
national and regional
 
grocery store chains,
 
club stores, companies
 
servicing independent supermarkets
in
 
in the
U.S.,
food
 
service
distributors,
distributors,
and
 
egg
product
 
consumers
located
primarily
in
 
states
across
 
the southwestern,
 
southwestern,
southeastern, mid-western
and mid-Atlantic
regions
of the U.S.
Our
 
Our operating
 
results
are
 
materially
impacted
 
by
market
 
prices for
 
eggs
and
 
feed
grains
 
(corn
 
and
soybean
 
meal),
which
 
are
highly
 
volatile,
 
independent
 
of
 
each
 
other,
 
and
 
out
 
of
 
our
 
control.
 
Generally,
 
higher
 
market
 
prices
 
for
 
eggs
 
have
 
a
 
positive
impact
 
on
 
our
 
financial
 
results
 
while
 
higher
 
market
 
prices
 
for
 
feed
 
grains
 
have
 
a
 
negative
 
impact
 
on
 
our
 
financial
 
results.
Although we
 
use a
 
variety of pricing
 
pricing mechanisms
in pricing
 
agreements with our
 
our customers,
we sell
 
most of
 
our conventional
shell eggs
 
based on
 
formulas that
 
consider,
 
in varying
 
ways, independently
 
quoted regional
 
wholesale market
 
market prices for
 
for shell
eggs or formulas related to our costs of production which include the cost of corn and soybean
 
meal.or
 
Weformulas
 
routinelyrelated
 
fillto
 
our
 
storage
bins
during
harvest
season
when
prices
for
feed
ingredients
are
generally
lower.
To
ensure
continued
availability of
feed ingredients,
we may
enter into
contracts for
future purchases
of corn
and soybean
meal, and
as
partcosts
 
of
 
theseproduction
 
contracts,which
 
we
may
lock-ininclude
 
the
 
basis
portion
of
our
grain
purchases
several
months
in
advance.
Basis
is
the
difference
between the
local cash
price for
grain and
the applicable
futures price.
A basis
contract is
a common
transaction in
the grain
market that
allows us
to lock-in
a basis
level for
a specific
delivery period
and wait
to set
the futures
price at
a later
18
date. Furthermore,
due to
the more
limited supply
for organic
ingredients,
we may
commit to
purchase organic
ingredients in
advance to help ensure supply.
Ordinarily, we do
not enter into long-term contracts beyond a year to purchase
corn and soybean
meal
or
hedge
against
increases
in
the
pricescost
 
of
 
corn
 
and
 
soybean
 
meal.
 
CornWe
 
anddo
 
soybeannot
 
meal
are
commodities
and
are
subject
to
volatile
price
changes
due
to
weather,
various
supply
and
demand
factors,
transportation
and
storage
costs,
speculators,
agricultural, energy and trade policies in the U.S. and internationally
and most recently the Russia-Ukraine war.
An important competitive advantage
for Cal-Maine Foods is
our ability to meet
our customers’ evolving needs
with a favorable
product
mix
of
conventional
and
specialtysell
 
eggs
including
cage-free,
organic
and
other
specialty
offerings,
as
well
as
egg
products.
directly to consumers or set the prices at which eggs are sold to consumers.
We
have
also
enhanced
our
efforts
to
provide
free-range
and
pasture-raised
eggs
that
meet
consumers’
evolving
choice
preferences.
While
a
small
part
of
our
current
business,
the
free-range
and
pasture-raised
eggs
we
produce
and
sellIndex
represent attractive offerings
to a subset of
consumers,
and therefore our customers,
and help us continue
to serve as the trusted
provider of quality food choices.
We are
also focused on additional ways
to enhance its product mix
and support new opportunities in the
restaurant, institutional
and industrial food
products arena. On
October 4, 2021, Cal-Maine
Foods announced a
strategic investment of $18.5
million in
debt
and
equity
in
Meadow
Creek
Foods,
LLC
(“MeadowCreek”),
an
egg
products
operation
located
in
Neosho,
Missouri,
focused on offering
hard-cooked eggs. Cal-Maine
Foods serves as the preferred
provider of specialty and
conventional eggs for
MeadowCreek
to
manufacture
egg
products.
On
December
13,
2022,
our
Board
of
Directors
approved
an
additional
$13.8
million investment
to expand
the Company’s
controlling interest
and fund
additional equipment
and working
capital needs
to
support growth opportunities for
MeadowCreek. As demand for
hard-cooked eggs continues to grow,
the funds will be used for
additional
refrigerated
storage
space
and
expanded
capacity
for
cooking
and
packaging
to
better
serve
MeadowCreek’s
customers.
Due
to
delays
caused
by
supply
chain
issues and
plans
for
expansion,
MeadowCreek
is
now
expected
to be
fully
operational by or before March 2023.
The
Company
has
joined
in
the
formation
of
a
new
egg
farmer
cooperative
in
the
western
United
States.
ProEgg,
Inc.
(“ProEgg”)
is
comprised
of
leading
egg
production
companies,
including
Cal-Maine
Foods,
servicing
retail
and
foodservice
shell egg customers in 13 western states. ProEgg is a producer-owned
cooperative organized under the Capper-Volstead
Act.
Our
membership
in
ProEgg
is
expected
to
provide
benefits
for
its
customers,
including
supply
chain
stability
and
enhanced
reliability.
Initially,
Cal-Maine Foods’
customer relationships
and customer
support are
expected to
remain the
same. At some
point in the future, it is anticipated
that each producer member will sell
through ProEgg the shell eggs
it produces for sale in the
western
states
covered
by
the
cooperative.
Customers
would
have
a
single
point
of
contact
for
their
shell
egg
purchases,
as
ProEgg would have a dedicated team to market and sell the members’ combined
egg production in the region.
The Company’s
top priority in joining
as a member of
ProEgg is serving
our valued customers in
this important market
region.
During
this
initial
phase,
we
will
continue
our
work
to
confirm
that
our
participation
in
this
new
cooperative
is
in
the
best
interest of
our customers
and aligns
with our
long-term interests.
This consideration
will take
place before
moving to
the next
phase of membership, and we expect this process to be completed on
or before the end of our fiscal year 2023.17
Retail
 
sales
 
of
 
shell
 
eggs
 
historically
 
have
 
been
 
highest
 
during
 
the
 
fall
 
and
 
winter
 
months
 
and
 
lowest
 
during
 
the
 
summer
months. Prices
 
for shell
 
eggs fluctuate
 
in response
 
to seasonal
 
demand factors
 
and a
 
natural increase
 
in egg
 
production during
the
 
spring
 
and
 
early
 
summer.
 
Historically,
 
shell
 
egg
 
prices
 
tend
 
to
 
increase
 
with
 
the
 
start
 
of
 
the
 
school
 
year
 
and
 
tend
 
to
 
be
highest
 
prior
 
to
 
holiday
 
periods,
 
particularly
 
Thanksgiving,
 
Christmas
 
and
 
Easter.
 
Consequently,
 
and
 
all
 
other
 
things
 
being
equal, we would expect to
 
expect to experience
lower selling prices, sales volumes
 
volumes and net
income (and may
 
incur net losses) in our
 
our first
and
 
fourth
 
fiscal
 
quarters
 
ending
 
in
 
August/September
 
and
 
May/June,
 
respectively.
 
Because
 
of
 
the
 
seasonal
 
and
 
quarterly
fluctuations,
 
comparisons
 
of
 
our
 
sales
 
and
 
operating
 
results
 
between
 
different
 
quarters
 
within
 
a
 
single
 
fiscal
 
year
 
are
 
not
necessarily meaningful comparisons.
HPAI
We
 
are closelyroutinely
 
monitoringfill
 
the currentour
 
outbreak ofstorage
 
HPAIbins
 
that wasduring
 
first detectedharvest
 
in commercialseason
 
flocks inwhen
 
the U.S.prices
 
in February
2022. Outbreaks in commercial flocks in the U.S. have most recentlyfor
 
occurred during each month from September to December
2022. Thefeed
 
current HPAIingredients
 
epidemic hasare
 
surpassed thegenerally
 
prior 2014-2015lower.
 
outbreak inTo
 
terms ofensure
the numbercontinued availability
 
of affectedfeed
 
hens iningredients, we
 
themay enter
into contracts
U.S.,
for future
purchases of
corn and
soybean meal,
 
and as
part
 
HPAIof
 
continuesthese
 
tocontracts,
 
circulatewe
 
throughoutmay
lock-in
 
the
 
wildbasis
 
birdportion
 
populationof
our
grain
purchases
several
months
in
advance.
Basis
is
the
difference between
the local
cash price
for grain
and the
applicable futures
price. A
basis contract
is a
common transaction
in
the grain
market that
allows us
to lock-in
a basis
level for
a specific
delivery period
and wait
to set
the futures
price at
a later
date. Furthermore,
due to
the more
limited supply
for organic
ingredients,
we may
commit to
purchase organic
ingredients in
advance to help ensure supply. Ordinarily,
we do not enter into long-term contracts beyond a year to purchase corn and soybean
meal
or
hedge
against
increases
 
in
 
the
 
U.S.prices
of
corn
 
and
 
abroad.soybean
 
Accordingmeal.
Corn
and
soybean
meal
are
commodities
and
are
subject
 
to
 
thevolatile
 
U.S.
Centersprice
 
forchanges
 
Disease Controldue
to
weather,
various
supply
 
and
 
Prevention,demand
 
thesefactors,
 
detectionstransportation
 
doand
 
not presentstorage
 
an immediate
public
health
concern.
There havecosts,
been no positive tests for HPAI
at any Cal-Maine Foods’ owned or contracted production
facility as of December 28, 2022. The
USDA division
of Animalspeculators, agricultural, energy and trade policies in the U.S. and internationally,
 
and Plantmost recently the Russia-Ukraine war.
An important competitive advantage for Cal-Maine Foods is our ability to meet
 
Health Inspectionour customers’ evolving needs with a favorable
product
 
Service (“APHIS”)
reported on
December 27,
2022 that
approximately
43.3 million commercial
layer hens and 1.0
million pullets have been
depopulated due to HPAI
this year.
We believe
the HPAI
outbreak will
continue to exert
downward pressure
on the overall
supply of eggs,
and the duration
of those effects
will depend
19
in part on the timing of replenishment of the U.S. layer
hen flock. Prior to the outbreak of HPAI
in February 2022, the layer hen
flock
five-year
average
from
2017
through
2021
was
comprisedmix
 
of
 
approximatelyconventional
 
328and
 
millionspecialty
 
hens.eggs,
 
Accordingincluding
cage-free,
organic
and
other
specialty
offerings,
as
well
as
egg
products.
We
have
also
enhanced
our
efforts
 
to
 
provide
free-range
and
pasture-raised
eggs
that
meet
consumers’
evolving
choice
preferences.
While
a
 
LEAP
Market Analytics report dated Decembersmall
 
8, 2022, the layer hen inventory
is not projected to exceed this 328 million
mark again
until
Decemberpart
 
of
 
2023.our
 
Layercurrent
 
hen
numbers
reported
bybusiness,
 
the
 
USDAfree-range
 
asand
pasture-raised
eggs
we
produce
and
sell
represent attractive offerings to a subset
 
of consumers, and therefore our customers, and help
 
December
1,
2022
were
308.3
million,
whichus continue to serve as the trusted
represents a
decreaseprovider of
5.8% compared
with the
layer hen
inventory a
year ago.
However,
the USDA
reported that
the hatch
from July 2022 through November 2022 increased 5.8% as compared
with the prior-year period.
While no
farm is
immune from
HPAI,
we believe
we have implemented
and continue
to maintain
robust biosecurity
programs
across our locations. We
are also working closely with federal, state and local government
officials and focused industry groups
to mitigate the risk of this and future outbreaks and effectively manage
our response, if needed. quality food choices.
CAGE-FREE EGGS
Ten
 
states
have
 
passed
 
legislation
or
 
regulations
mandating
 
minimum
space
 
or
 
cage-free
requirements
 
for
 
egg
production
 
or
mandated
 
the
 
sale
 
of
 
only
 
cage-free
 
eggs
 
and
 
egg
 
products
 
in
 
their
 
states,
 
with
 
implementation
 
of
 
these
 
laws
 
ranging
 
from
January
2022
 
to
January
 
2026.
These
 
states
represent
 
approximately 27%
 
27%of
the U.S.
total
population according
to the
2020
U.S. Census.
California, Massachusetts,
and Colorado,
which collectively
represent approximately
16% of
the total
estimated
U.S. population,
have cage-free
legislation in
effect currently.
In May
2023, the
U.S. Supreme
Court upheld
as constitutional
California’s
law
that
requires
the
sale
of
only
cage-free
eggs
in
that
state
and
regardless
 
of
 
the
 
U.S.state
 
totalin
 
populationwhich
 
accordingthe
eggs
are
produced. Although
we do
not sell
the majority
of our
eggs in
these ten
states, these
state laws
have impacted
egg production
practices nationally.
A
significant
number
of
our
customers
previously
announced
goals
 
to
 
the 2020
U.S. Census.
In California
and Massachusetts,
which
collectively represent
14% of
the total
U.S. population
according to
the
2020 U.S. Census,offer
 
cage-free legislation went
into effect January
1, 2022. However,
these laws are subject
to judicial challenge,
and in October 2022 the Supreme Court of the U.S. heard oral arguments
in a case challenging California’s
law that requires the
sale of only
cage-free eggs in
that state. A
decision in that
case is expected
next year.
These laws have
already affected
and, if
upheld,
will
continue
to
affect
sourcing,
production
and
pricing
of
 
eggs
 
(conventional
as
well
as
specialty)
as
the
national
demand
for cage-free
production could
be greater
than the
current supply,
which would
increase the
prices
of cage-free
eggs,
unless more
cage-free production
capacity is constructed.
Likewise, the national
supply for
eggs from
conventional production
could exceed consumer demand which would decrease the prices
of conventional eggs.
A significant number
of our customers
have previously announce
d
goals to offer
cage-free eggs exclusively
 
on
or
before
 
2026,
subject in
 
most cases to
 
to availability
of supply,
 
affordability and
 
customerconsumer demand, among
 
among other
contingencies. Some
 
of these
customers have
 
recently changed
 
those goals
 
to offer
 
70% cage-free
 
eggs by
 
the end
 
of 2030.
 
Our customers
 
typically do
 
not
commit to long-term
purchases of specific quantities or
 
or types of eggs
with us, and as
 
a result, it is difficult to
 
to accurately predict
customer
 
requirements
 
for
 
cage-free
 
eggs.
 
We
 
are
 
however,focused
 
engagingon
adjusting
our
cage-free
production
capacity
 
with
a
goal
of
meeting
the
future
needs
of
 
our
 
customers
 
in
 
anlight
 
effortof
 
tochanging
 
achievestate
 
a
smooth
transition
in
meeting
their
announced
goalsrequirements
 
and
 
our
customer’s
goals.
As
always,
we
strive to
offer a
product mix
that aligns
with current
and anticipated
customer purchase
decisions. We
are engaging
with our
customers to
help them
meet their
announced goals
and needs.
 
We
 
have
invested
 
significant
capital
 
in
recent
 
years to
acquire
and construct cage-free facilities, and we expect our focus for
future expansion will continue to include cage-free facilities. Our
volume
of
cage-free
egg
sales
has
continued
 
to
 
acquireincrease
 
and
construct cage-free
 
facilities, andaccount
 
we expectfor
a
larger
share
of
 
our focus
 
for futureproduct
 
expansion willmix.
 
continue toCage-free
 
include cage-free
facilities. At
theegg
revenue represented approximately 33.0% of our total net shell egg revenue for the first quarter of fiscal year 2024. At the same
time,
 
we
 
understand
 
the
importance
 
of
 
our
 
continued
 
ability
to
 
provide
conventional
 
eggs
 
in
order
 
to
 
provide our
 
ourcustomers
customers with a variety of egg choices and to address hunger in our communities.
 
For
 
additional
 
information,
 
see
 
the
 
20222023
 
Annual
 
Report,
 
Part
 
I
 
Item
 
1,
 
“Business
 
–
 
Specialty
 
Eggs,”
 
“Business
 
–
 
Growth
Strategy” and
 
“Business –
 
Government Regulation,”
 
Regulation,” and the
 
the first risk
 
risk factor in
 
in Part I
 
I Item 1A,
 
1A, “Risk“Risk Factors”
 
Factors” under the
 
the sub-
heading “Legal and Regulatory Risk Factors.”
EXECUTIVE OVERVIEWACQUISITION
ForAfter the
end of
the fiscal
quarter,
we entered
into a
definitive agreement
to acquire
substantially all
the assets
of Fassio
Egg
Farms,
Inc.
(“Fassio”),
related
to
its
commercial
shell
egg
production
and
processing
business.
The
assets
to
be
acquired,
18
subject to
the completion
of the
transaction, include
commercial shell
egg production
and processing
facilities with
a current
capacity
of
approximately
1.2
million
laying
hens,
primarily
cage-free,
a
feed
mill,
pullets,
a
fertilizer
production
and
composting
operation
and
land
located
in
Erda,
Utah,
outside
Salt
Lake
City.
We
expect
 
the
 
transaction
to
close
during
the
second quarter of fiscal 2024,
subject to customary closing conditions. Once
completed, the acquisition will expand our
market
presence in Utah and the western United States.
HPAI;
EGG SUPPLY OUTLOOK
The most recent
outbreak of highly
pathogenic avian influenza (“HPAI”)
impacted our business
and financial results primarily
during the fourth quarter of fiscal 2022
and continuing through the first part of our
fourth quarter of fiscal 2023.
For additional
information, see
the 2023
Annual Report,
Part II
Item 7
“Management’s
Discussion and
Analysis of
Financial Condition
and
Results of Operations –
HPAI.”
While the last occurrence
in a commercial egg
laying flock was in
December 2022, there have
been
occurrences in
other
avian populations
in
the
U.S.
since then.
HPAI
is
still present
in
the
wild bird
population and
the
extent
of
possible
future
outbreaks,
particularly
during
the
upcoming
fall
migration
season,
cannot
be
predicted.
There
have
been no
positive tests
for HPAI
at any
of Cal-Maine
Foods’ owned
or contracted
production facilities
as of
October 3,
2023.
Based on USDA data,
we believe that the
U.S. layer hen flock,
which declined as a
result of flock depletions due
to HPAI,
has
largely recovered but remains slightly lower than the five-year average.
Layer hen numbers
reported by the
USDA as of
September 1, 2023,
were 318.2 million,
which represents an
increase of 3.1%
compared with
the
layer hen
inventory
a year
ago. The
USDA also
reported
that
the hatch
from April
2023
through August
2023 increased 2.0% as compared with the prior-year period, indicating that layer flocks may continue to increase in the future.
EXECUTIVE OVERVIEW
For the first quarter
of fiscal 2024, we
recorded a gross profit
of $45.4 million compared
to $217.5 million for
the same period
of fiscal 2023, with
the decrease due primarily
to lower conventional shell
egg prices and increased
labor costs, partially offset
by lower farm production costs due to the decrease in feed ingredient prices.
Our
net
average selling
price
per
dozen for
the first
 
quarter
 
of
 
fiscal 2024
 
2023,
we
recorded
a
gross
profit
ofwas
 
$317.8
million1.589
 
compared
 
to $2.275
 
$43.7
million
forin
 
the
same prior-year
period of
fiscal 2022,
with the
increase
due primarily
to higher
shellperiod. Conventional egg
 
prices partiallyper dozen
 
offsetwere $1.241
 
bycompared to $2.368
for the prior-year
period, and specialty
egg prices
per dozen were $2.278 compared
to $2.101 for the prior-year
period. Conventional egg prices were
lower in the first
quarter of
fiscal 2024
compared to
the prior-year
period as
overall egg
supply recovers
from the
 
increasedmost recent
 
cost ofHPAI
 
feed
ingredients and processing, packaging and warehouse costs.
Our netoutbreak. The
 
daily
average sellingprice for the Urner Barry southeast large index for the first quarter of fiscal 2024 decreased 48.7% from the comparable
period in the
 
price perprior year.
 
dozen forIn the first
 
quarter of fiscal 2024,
specialty egg prices exceeded
conventional egg prices as
opposed to
the secondfirst
 
quarter of
 
fiscal 2023,
 
was $2.709
comparedreturning to
 
$1.365 ina historically
 
the prior-yearnormal relative
period.position. Conventional
 
egg prices
 
per dozengenerally respond
more quickly
 
were $2.883to market
 
compared toconditions because
 
$1.151 forwe sell
 
the prior-yearmajority
 
period,of our
conventional shell
eggs based
on formulas
that adjust
periodically and
 
specialty eggtake into
 
prices
per dozen were $2.370 compared to $1.898 for
the prior-year period. Conventional egg prices increasedaccount, in
 
the second quarter of
fiscalvarying ways,
 
2023independently quoted
 
primarily
due
to decreased
supply
caused
by
the
HPAI
outbreak
combined
with
good
customer
demand.
See
the
discussion under the
heading “HPAI”
above. The daily
average price for the
UB southeast large
index for the second
quarter of
fiscal 2023 increased 154.8% from the comparable period
in the prior year, reaching near-record
highs. Conventional egg prices
exceeding
specialty
egg
prices
has
occurred
for
the
past
three
quarters
but
is
atypical
historically.
Conventional
egg
prices
generally
respond
more
quickly
to
market
conditions
because
we
sell
the
majority
of
our
conventional
shell
eggs
based
on
formulas that adjust periodically and take into account,
in varying ways, independently quoted regional wholesale
 
market prices
for shell eggs
 
eggs or
formulas related to our
 
to our costs of production. The
 
of production.
The majority
of our specialty
 
eggs are typically sold
 
sold at prices and terms
 
andnegotiated
terms negotiated directly with
 
with customers and
 
therefore do not
 
not fluctuate
as much
 
as conventional pricing.
 
pricing. For
information about
historical shell
egg prices, see Part I Item I of our 20222023 Annual Report.
 
Our total
dozens sold
decreased 0.8%
to 273.1
million dozen
shell eggs
for the
first quarter
of fiscal
2024 compared
to 275.3
million dozen for
the same period
of fiscal 2023.
For the first
quarter of fiscal
2024, conventional dozens
 
sold increased 5.4% to1.0%
and specialty dozens sold decreased 4.2% as compared
 
284.1 million dozen shell
eggs forto the second
same quarter ofin fiscal 2023
compared to 269.6
million
dozen2023. Demand
 
for specialty eggs decreased
in
 
the
 
same
period
of
fiscal
2022.
For
the secondfirst
 
quarter
 
of
 
fiscal
 
2024
compared
to
the
same
prior
year
period
due
primarily
to
the
large
decrease
in
prices
for
conventional eggs compared to the prior four quarters.
Our farm
production costs
per dozen
produced for
the first
quarter of
fiscal 2024
decreased 1.0%,
or $0.01,
compared to
the
first quarter of
fiscal 2023. However,
feed costs per
dozen produced decreased 10.5%
or $0.07 compared
to the first
quarter of
fiscal 2023
 
conventionalprimarily due
 
dozensto reduced
 
soldcorn prices,
 
decreasedour primary
feed ingredient.
For the
first quarter
of fiscal
2024, the
average
Chicago
Board
of
Trade
(“CBOT”)
daily
market
price
was
$5.30
per
bushel
for
corn
and
$422
per
ton
for
soybean
meal,
representing decreases of 20.2% and 7.4%, respectively,
compared to the average daily CBOT prices for the
comparable period
in the prior year. For information about historical corn and soybean meal prices, see Part I Item I of our 2023 Annual Report.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2019
2.2%RESULTS OF OPERATIONS
The following table sets
 
andforth, for the periods
 
specialtyindicated, certain items from
 
dozens
sold
increased
24.1%
as compared
to
the
same
quarter
in
fiscal
2022.
Demand
for
specialty
eggs
increased
in
the
second
quarter
of
fiscal
2023
compared
to
the
same
prior
year
period
due
primarily
to
the
higher
prices
for
conventional
eggs. Further,
demand for
specialty eggs
continued to
increase as
retailers continued
to shift
to selling
cage-free
products and cage-free legislation went into full effect in California
and Massachusetts on January 1, 2022.
Our farm
production costs
per dozen
produced for
the second
quarter of
fiscal 2023
increased 22.0%,
or $0.193,
compared to
the second quarterour Condensed Consolidated Statements
 
of fiscal 2022.
This increase was
primarily due to
increased prices for
feed ingredients and
a higher basis
inIncome
corn in
most of
our production
areas,
which added
to our
expense. For
the second
quarter of
fiscal 2023,
the average
Chicago
Board of
Trade
(“CBOT”) daily
market price
was $6.78
per bushel
for corn
and $423
per ton
for soybean
meal, representing
increases
of 24.8% and
25.5%, respectively,
compared to the average
daily CBOT prices
for the comparable
period in the prior
year. For information about
historical corn and soybean meal prices, see Part I Item I of our 2022 Annual Report.
RESULTS OF
OPERATIONS
The
following
table
sets
forth,
for
the
periods
indicated,
certain
items
from
our
Condensed
Consolidated
Statements
of
Operations expressed as a percentage of net sales.
Thirteen Weeks
Ended
Twenty-six Weeks
EndedSeptember 2, 2023
November 26,
August 27, 2022
November 27,
2021
November 26,
2022
November 27,
2021
Net sales
100.0
%
100.0
%
100.0
%
100.0
%
Cost of sales
60.490.1
%
88.5
%
63.3
%
92.967.0
%
Gross profit
39.69.9
%
11.5
%
36.7
%
7.133.0
%
Selling, general and administrative
7.211.3
%
12.5
%
7.6
%
13.3
%
(Gain) loss on disposal of fixed assets
—
%
(0.5)
%
—
%
(0.3)8.1
%
Operating income (loss)
32.4(1.4)
%
(0.5)
%
29.1
%
(5.9)24.9
%
Total other income, net
0.3
%
0.7
%
0.3
%
1.2
%
Income (loss) before income taxes
32.71.6
%
0.2
%
29.4Income before income taxes
0.2
%
(4.7)25.1
%
Income tax expense (benefit)
8.00.1
%
(0.2)6.1
%
7.1Net income
0.1
%
(2.3)19.0
%
Less: Loss attributable to noncontrolling interest
(0.1)
%
—
%
Net income (loss)attributable to Cal-Maine Foods, Inc.
24.70.2
%
0.4
%
22.3
%
(2.4)19.0
%
NET SALES
Total
net
 
sales for the first
 
quarter of fiscal 2024
were $459.3 million compared
to $658.3 million for
 
the
second
quarter
same period of
 
fiscal
2023
were
a
record
$801.7
million
compared
to
$381.7
million
for
the
same
period of fiscal 2022.2023.
Net shell
egg sales represented
 
96.5% represented 95.2%
and 97.0% 95.8%
of total
net sales
 
for the second
first quarters
of fiscal
 
2024 and
2023, and 2022, respectively.
Shell egg
sales classified
 
as “Other” represent
 
sales of hard-cooked
eggs and other
miscellaneous byproducts included
with our
shell egg operations.
Total
net
represent sales
 
forof miscellaneous
 
the
twenty-six
weeks
ended
November
26,
2022
were
$1.46
billion,
compared
to
$706.7
million
for
the
comparable period of fiscal 2022.
Net
shell
egg
sales
represented
96.2%
byproducts and
 
97.1%resale products
 
ofincluded with
 
total
net
sales
for
the
twenty-six
weeks
ended
November
26,
2022
andour shell
November 27, 2021, respectively.egg operations.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
20
The table below presents an analysis of our conventional and specialty shell egg sales (in thousands, except percentage data):
Thirteen Weeks Ended
September 2, 2023
August 27, 2022
Total net sales
$
459,344
$
658,344
Conventional
$
225,280
51.6
%
$
425,589
67.5
%
Specialty
208,681
47.7
%
200,820
31.8
%
Egg sales, net
433,961
99.3
%
626,409
99.3
%
Other
3,160
0.7
%
4,295
0.7
%
Net shell egg sales
$
437,121
100.0
%
$
630,704
100.0
%
Net shell egg sales as a percent of total net sales
95.2
%
95.8
%
Dozens sold:
Conventional
181,530
66.5
%
179,712
65.3
%
Specialty
91,596
33.5
%
95,605
34.7
%
Total dozens sold
273,126
100.0
%
275,317
100.0
%
Net average selling price per dozen:
Conventional
$
1.241
$
2.368
Specialty
$
2.278
$
2.101
All shell eggs
$
1.589
$
2.275
Egg products sales:
 
Egg products net sales
$
22,223
$
27,640
Pounds sold
19,353
16,502
Net average selling price per pound
$
1.148
$
1.675
Shell egg net sales
First Quarter – Fiscal 2024 vs. Fiscal 2023
-
In
 
the first
 
quarter of
 
fiscal 2024,
 
conventional egg
 
sales decreased
 
$200.3 million,
 
or
 
47.1%, compared
 
to the
 
first
quarter
 
of
 
fiscal
 
2023,
 
primarily
 
due
to
a
47.6%
decrease
in
the
prices
for
conventional
eggs,
which
resulted
in
a
$204.6 million decrease in net sales, partially offset by a 1.0% increase in the volume of conventional eggs sold, which
resulted in a $4.3 million increase in net sales.
-
Conventional egg prices decreased
in the first quarter
of fiscal 2024 compared
to the first quarter
of fiscal 2023 as
the
U.S.
egg supply
recovers from
the most
recent HPAI
outbreak that
impacted our
results primarily
during the
fourth
quarter of fiscal 2022 and continuing through the first part of our fourth quarter of fiscal 2023.
-
Specialty egg
sales increased
$7.9 million, or
3.9%, in
the first
quarter of fiscal
2024 compared
to the first
quarter of
fiscal
2023,
primarily
due
to
an
8.4%
increase
in
the
prices
for
specialty
eggs,
which
resulted
in
a
$16.2
million
increase in net sales,
partially offset by
a 4.2% decrease in
the volume of specialty
eggs sold, which resulted
in a $8.4
million decrease in net sales.
-
Net average selling prices of specialty eggs increased in response to higher input costs and market conditions.
-
Demand for
specialty eggs
decreased as
conventional egg
prices were
significantly lower
in the
first quarter
of fiscal
2024 compared to the first quarter of fiscal 2023.
-
Cage-free egg
revenue for
the first
quarter of
fiscal 2024
represented 33.0%
of our
total net
shell egg
revenue versus
19.4% for
the same
prior year
period due
to the
lower conventional
egg prices
causing conventional
egg revenue
to
represent a smaller proportion of our total sales.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
21
The table below presents an analysis of our conventional and specialty shell egg
sales (in thousands, except percentage data):
Thirteen Weeks
Ended
Twenty-six Weeks
Ended
November 26, 2022
November 27, 2021
November 26, 2022
November 27, 2021
Total net sales
$
801,700
$
381,723
$
1,460,044
$
706,709
Conventional
$
541,917
70.1
%
$
221,142
59.7
%
$
967,506
69.0
%
$
403,172
58.8
%
Specialty
227,778
29.4
%
146,917
39.7
%
428,598
30.5
%
279,375
40.7
%
Egg sales, net
769,695
99.5
%
368,059
99.4
%
1,396,104
99.5
%
682,547
99.5
%
Other
3,953
0.5
%
2,263
0.6
%
8,248
0.6
%
3,395
0.5
%
Net shell egg sales
$
773,648
100.0
%
$
370,322
100.0
%
$
1,404,352
100.1
%
$
685,942
100.0
%
Net shell egg sales as a
percent of total net sales
96.5
%
97.0
%
96.2
%
97.1
%
Dozens sold:
Conventional
187,976
66.2
%
192,135
71.3
%
367,688
65.7
%
376,003
71.7
%
Specialty
96,110
33.8
%
77,420
28.7
%
191,715
34.3
%
148,171
28.3
%
Total dozens sold
284,086
100.0
%
269,555
100.0
%
559,403
100.0
%
524,174
100.0
%
Net average selling price
per dozen:
Conventional
$
2.883
$
1.151
$
2.631
$
1.072
Specialty
$
2.370
$
1.898
$
2.236
$
1.885
All shell eggs
$
2.709
$
1.365
$
2.496
$
1.302
Egg products sales:
Egg products net sales
28,052
11,401
55,692
20,767
Pounds sold
15,702
16,009
32,204
31,278
Net average selling price
per pound
1.787
0.712
1.729
0.664
Shell egg net sales
SecondFirst Quarter – Fiscal 2023
2024 vs. Fiscal 20222023
-
InEgg
products
net
sales
decreased
$5.4
million,
or
19.6%,
for
 
the
 
secondfirst
 
quarter
 
of
 
fiscal
 
2023,
conventional
egg
sales
increased
$320.8
million,
or
145.0%,
compared
to
the
second quarter
of fiscal 2022,
primarily due
to the increase
in the price
s
for conventional shell
eggs, slightly
offset by
a decrease
in volume
of conventional
shell eggs
sold. Changes
in prices
resulted in
a $325.6
million increase
and the
change in volume resulted in a $4.8 million decrease in net sales, respectively.
-
Conventional egg prices increased in the second
quarter of fiscal 2023
primarily due to decreased supply caused by
the
HPAI
outbreak,
discussed
above,
while
we
experienced
continued
good
customer
demand
(and
typical
seasonal
consumer demand).
-
As a result of
the independently quoted
wholesale market prices
for conventional
eggs reaching near-record
highs, the
average selling
price for conventional
eggs exceeded
the average selling
price for specialty
eggs in the
second quarter
of
fiscal
2023,
which
has
occurred
for
the
past
three
quarters
but
is
atypical
historically.
Conventional
egg
prices
generally respond
more quickly
to market
conditions as
we sell
the majority
of our
conventional shell
eggs based
on
formulas
that
adjust
periodically
and
take
into
account,
in
varying
ways,
independently
quoted
regional
wholesale
market
prices
for
shell
eggs
or
formulas
related
to
our
costs
of
production.
The
majority
of
our
specialty
eggs
are
typically
sold
at
prices
and
terms
negotiated
directly
with
customers
and
therefore
do
not
fluctuate
as
much
as
conventional pricing.
-
Specialty
egg
sales
increased
$80.9
million,
or
55.0%,
in
the
second
quarter
of
fiscal
20232024
 
compared
 
to
 
the
 
second
quarter
of
fiscal
2022,
primarily
due
to
a
24.9%
increase
in
the
prices
for
specialty
eggs,
which
resulted
in
a
$45.4
million
increase
in
net
sales
and
a
24.1%
increase
in
the
volume
of
specialty
eggs
sold,
which
resulted
in
a
$35.5
million increase in net sales.
22
-
Net average
selling price of
specialty eggs increased
in response to
rising feed and
other input costs
as well as
current
market conditions due to HPAI.
-
Demand for specialty eggs
increased as conventional egg prices
rose. Our sales volume
benefited as we produced 11%
more specialty
eggs in
the second
quarter of
fiscal 2023
versus the
prior-year period,
through use
of our
higher cage-
free production capacity
and better utilization of that capacity.
-
Cage-free
egg
sales
for
the
second
quarter
of
fiscal
2023
represented
18.2%
of
our
total
net
shell
egg
sales
versus
22.4%
for
the
same
prior
year
period
due
to
the
higher
conventional
egg
prices.
Cage-free
dozens
sold
increased
47.4% in the second quarter of fiscal 2023 as compared to the second
quarter of fiscal 2022.
Twenty-six weeks –
Fiscal 2023 vs. Fiscal 2022
-
For
the
twenty-six
weeks
ended
November
26,
2022,
conventional
egg
sales
increased
$564.3
million
or
140.0%
compared
to
the
same
period
of
fiscal
2022,
primarily
due
to
the
increase
in
the
prices
for
conventional
shell
eggs,
slightly offset
by the decrease
in the volume
of conventional eggs
sold. Changes
in prices
resulted in a
$573.2 million
increase and the change in volume resulted in a $9.0 million decrease in net
sales, respectively.
-
Specialty egg sales
increased $149.2 million,
or 53.4%, for the
twenty-six weeks ended
November 26, 2022 compared
to
the
same
period
of
fiscal
2022,
primarily
due
to
a
29.4%
increase
in
the
volume
of
specialty
dozens
sold.
The
volume
of
specialty
dozens
sold
increased
mainly
due
to
the
higher
conventional
egg
prices.
Change
in
volume
resulted in a
$82.1 million increase
and changes in
specialty egg price resulted
in a $67.3 million
increase in net sales,
respectively.
Egg products net sales
Second Quarter – Fiscal 2023
vs. Fiscal 2022
-
Egg products
net sales
increased $16.7
million or
146.0% for
the second
quarter of
fiscal 2023
compared to
the same
period of
 
fiscal 2022,2023,
 
primarily due
 
to a
 
151.0%31.5% selling
 
price increase,decrease,
 
which had
 
a $16.9$10.2
 
million positivenegative
 
impact on
net sales.
-
Our
egg
products
net
average
selling
price
 
increased
decreased in
the
second
quarter
of
fiscal
2023,
compared
to
the
second
first quarter of
 
fiscal 2022
as the
supply of
shell eggs
used to
produce
egg products
decreased
due
to the
HPAI
outbreak
that started in February 2022.
Twenty-six weeks –
Fiscal 2023 vs. Fiscal 2022
-
Egg products
net sales
increased $34.9
million or
168.2%, primarily
due to
a 160.4%
selling price
increase2024, compared
to the first twenty-six weeks of fiscal 2022, which had a $34.3 million
 
positive impact on net sales.quarter of
-
Ourfiscal 2023 as the supply of shell eggs used to produce egg products recovers from the most recent HPAI outbreak.
 
products net average
selling price increased
in the twenty-six
weeks ended
November 26,
2022, compared
to
the
same
period
in fiscal
2022 as
the
supply of
shell
eggs used
to produce
egg products
decreased
due
to the
HPAI
outbreak that started in February 2022.
COST OF SALES
Costs
of
sales
 
for
the
second first
 
quarter
of
fiscal
 
2023
2024 were
$483.9 $413.9
 
million
compared
to
 
$338.0
440.9 million
for
 
the
same
period
 
of fiscal
fiscal 2022.2023.
 
The following table presents the key variables affecting our cost of sales (in thousands, except cost per dozen data):
Thirteen Weeks Ended
September 2, 2023
August 27, 2022
%
Change
Cost of Sales:
Farm production
$
253,507
$
266,651
(4.9)
%
Processing, packaging, and warehouse
81,906
81,417
0.6
Egg purchases and other (including change in inventory)
60,797
68,298
(11.0)
Total shell eggs
396,210
416,366
(4.8)
Egg products
17,701
24,488
(27.7)
Total
$
413,911
$
440,854
(6.1)
%
Farm production costs (per dozen produced)
Feed
$
0.597
$
0.667
(10.5)
%
Other
$
0.439
$
0.379
15.8
%
Total
$
1.036
$
1.046
(1.0)
%
Outside egg purchases (average cost per dozen)
$
1.65
$
2.57
(35.8)
%
Dozens produced
250,356
257,654
(2.8)
%
Percent produced to sold
91.7%
93.6%
(2.0)
%
Farm Production
First Quarter – Fiscal 2024 vs. Fiscal 2023
-
Feed costs per dozen produced decreased 10.5% in the first quarter of fiscal 2024 compared to the first quarter of fiscal
2023. This decrease
was primarily due to
lower prices for corn,
our primary feed
ingredient. Basis levels for
corn and
soybean meal were lower in our areas of operations compared to our prior year first fiscal quarter. The decrease in feed
cost per
dozen resulted
in a
decrease in
cost of
 
sales consistsof
$17.5 million
for the
first quarter
 
of fiscal
 
costs directly2024 compared
 
relatedto
the prior period quarter.
-
For the first
quarter of fiscal
2024, the average
daily CBOT market
price was $5.30
per bushel for
corn and $422
per
ton of soybean meal, representing decreases of 20.2% and
7.4%, respectively, as compared
 
to producing,the average daily CBOT
prices for the first quarter of fiscal 2023.
 
processing
-
Other farm production costs increased primarily due to higher flock amortization and
 
packingfacility costs. Flock amortization
increased
 
shell eggs,primarily
 
purchasesfrom
 
ofhigher
 
shellcapitalized
 
eggs from
outside producers, processing and packing of liquidfeed
 
and frozen egg products and other non-egg costs. Farm
production costs are
those costs
 
incurred atas
well
as
higher
amortization
costs
from
an
increase
in
our
cage-free production.
Cage-free dozens
sold increased
12.6% in
 
the eggfirst
 
production facility,quarter of
 
including feed,fiscal 2024
 
facility,compared to
 
hen amortization
and other
related farm
productionthe first
costs.quarter of fiscal 2023.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
23
The following table presents the key variables affecting our cost of
sales (in thousands, except cost per dozen data):
Thirteen Weeks
Ended
Twenty-six Weeks
Ended
November 26,
2022
November 27,
2021
%
Change
November 26,
2022
November 27,
2021
%
Change
Cost of Sales:
Farm production
$
276,008
$
221,971
24.3
%
$
542,659
$
429,466
26.4
%
Processing, packaging,
and warehouse
83,639
69,474
20.4
165,056
134,533
22.7
Egg purchases and other
(including change in
inventory)
97,973
36,859
165.8
166,271
74,832
122.2
Total shell eggs
457,620
328,304
39.4
873,986
638,831
36.8
Egg products
26,231
9,672
171.2
50,719
17,486
190.1
Total
$
483,851
$
337,976
43.2
%
$
924,705
$
656,317
40.9
%
Farm production costs
(per dozen produced)
Feed
$
0.685
$
0.529
29.5
%
$
0.676
$
0.537
25.9
%
Other
$
0.386
$
0.349
10.6
%
$
0.383
$
0.351
9.1
%
Total
$
1.071
$
0.878
22.0
%
$
1.059
$
0.888
19.3
%
Outside egg purchases
(average cost per dozen)
$
3.14
$
1.56
101.3
%
$
2.88
$
1.45
98.6
%
Dozens produced
261,358
256,786
1.8
%
519,012
493,244
5.2
%
Percent produced to sold
92.0%
95.3%
(3.5)
%
92.8%
94.1%
(1.4)
%
Farm Production
Second Quarter – Fiscal 2023
vs. Fiscal 202222
-
Feed costs per dozenFacility
 
produced increased 29.5% incosts
 
the second quarter of fiscalincreased
 
2023 compared to thedue
 
second quarter of
fiscal 2022. This increase was primarily due to increased prices for corn, our primary
 
feed ingredient.
-
For theto
 
second quarterincreased
 
of fiscallabor
 
2023, thecosts.
 
average dailyLabor
 
CBOT marketcosts
 
price wasincreased
 
$6.78 per16.5%
 
bushel for
corn and
$423
per
ton of
soybean
meal representing
increases
of 24.8%
and
25.5%, respectively,
as compared
 
to
 
the average
 
dailyfirst
CBOT prices for the second quarter of fiscal 2022.
-
Other farm
production costs
increased due
to higher
facility and
flock amortization,
primarily from
higher feed
costs,
which
began to
rise in
our third
quarter of
fiscal 2021
due to
increased
prices discussed
above,
and which
remained
high
in
the
second
quarter
of
fiscal
2023.
Feed
costs
are
capitalized
in
our
flocks
during
pullet
production
and
increased our amortization expense.
Twenty-six weeks –
Fiscal 2023 vs. Fiscal 2022
-
Feed costs
per dozen
produced increased
25.9% in
the twenty-six
weeks ended
November 26,
2022 compared
to the
same period of fiscal 2021, primarily due to higher feed ingredient prices.increase in contract labor in response to labor shortages.
-
Other farm
production costs
increased due
to higher
facility and
flock amortization,
primarily from
higher feed
costs,
which
began to
rise in
our third
quarter of
fiscal 2021
due to
increased
prices discussed
above,
and which
remained
high
in
the
second
quarter
of
fiscal
2023.
Feed
costs
are
capitalized
in
our
flocks
during
pullet
production
and
increased our amortization expense.
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 ratioCurrent indications
 
for corn
 
as aproject an
 
result ofoverall better
 
weather-related shortfallsstocks-to-use ratio;
 
in productionhowever,
until this
year’s harvest
is complete
 
and yields,as
long
 
ongoing disruptionsas
 
related tooutside
 
the
COVID-19factors
 
globalremain
 
pandemicuncertain
(including
weather
patterns
 
and
 
the
 
Russia-Ukraine
 
war
 
and
 
its impact
effect
 
on
 
the
export markets
.
Additionally,
basis
levels
for
corn ran
significantly higher
markets), volatility could remain. Soybean meal supply has remained tight relative to demand in our area
the first quarter of operations
compared to
our prior
year second
fiscal quarter,
adding to
our expense.
24
For
fiscal
 
2023,
we
expect
continued
corn
and
soybean
upward
pricing
pressures
and
further
market
volatility
to
affect
feed
costs.
2024.
Processing, packaging, and warehouse
SecondFirst Quarter – Fiscal 2023
2024 vs. Fiscal 20222023
-
Cost ofProcessing, packaging,
materials increased 38.3
%
and warehouse costs remained relatively consistent compared to the
second first quarter of
fiscal 20222023.
On a per dozen basis, costs in this category increased due to risingthe decrease in processing volume.
 
inflation and
labor costs.
-
Labor costs increased 49.2%
due to wage increases and increased use of contract labor in response to labor shortages
.
-
Dozens
processed
increased
5.4%
compared
to
the
second
quarter
of
fiscal
2022,
which
resulted
in
a
$4.0
million
increase in costs.
Twenty-six weeks –
Fiscal 2023 vs. Fiscal 2022
-
Cost
of
packaging
materials
increased
26.7%
compared
to
the
twenty-six
weeks
ended
November
27,
2021
due
to
rising inflation and labor costs.
-
Labor costs
increased 30.3%
due to
wage increases
in response
to labor
shortages, primarily
due to
the pandemic
and
its effects.
-
Dozens processed
increased 7.0%
compared
to the
twenty-six weeks
ended November
27, 2021,
which resulted
in a
$9.9 million increase in costs.
Egg purchases and other (including change in inventory)
SecondFirst Quarter – Fiscal 2023
2024 vs. Fiscal 20222023
-
Costs in this
 
this category increased
 
decreased primarily
due to
 
higher lower shell
egg prices
 
as well asthe
 
average cost
per dozen
of outside
egg
purchases decreased 35.8% compared to first quarter of fiscal 2023. The decrease was partially offset by an increase in
the volume of
outside egg
purchases, causing the percentage of produced to sold to decrease to 92.0%91.7% from
95.3%.
Twenty-six weeks –
Fiscal 2023 vs. Fiscal 2022
-
Costs in this
category increased
primarily due to
higher egg prices
as well as
an increase in
the volume of
outside egg
purchases, as our percentage of produced to sold decreased to 92.8% from 94.1% 93.6%.
GROSS PROFIT
 
Gross profit
for the
second first quarter
of fiscal
2023 2024 was
$317.8 $45.4 million
compared to
$43.7 $217.5 million
for the
same period
of fiscal 2023.
2022.
The increase
decrease of $274.1
$172.1 million was
primarily due
to higher
lower conventional egg prices
as well
as the
and increased volume
of specialty
eggs
sold,labor costs, partially offset by
lower farm production costs due to the increased cost ofdecrease in feed ingredients and
processing, packaging and warehouse costs.
Gross profit
for the
twenty-six weeks
ended November
26, 2022
was $535.3
million compared
to $50.4
million for
the same
period of fiscal
2022. The increase
of $484.9 million
was primarily due
to higher egg
prices as well as
the increased volume
of
specialty eggs sold, partially offset by the increased cost of feed ingredients
and processing, packaging and warehouse costs.ingredient prices.
SELLING, GENERAL, AND ADMINISTRATIVE
EXPENSES
Selling,
 
general,
 
and
 
administrative
 
expenses(“SGA”)
 
("SGA")expenses
 
include
 
costs
 
of
 
marketing,
 
distribution,
 
accounting
 
and
 
corporate
overhead. The following table presents an analysis of our SGA expenses (in thousands):
Thirteen Weeks
Ended
November 26,September 2, 2023
August 27, 2022
November 27, 2021
$ Change
% Change
Specialty egg expense
$
14,67312,005
$
14,26213,067
$
411(1,062)
2.9(8.1)
%
Delivery expense
18,17517,691
14,39519,916
3,780(2,225)
26.3(11.2)
%
Payroll, taxes and benefits
13,82712,066
11,30310,987
2,5241,079
22.39.8
%
Stock compensation expense
9871,040
9751,025
1215
1.21.5
%
Other expenses
10,2909,444
6,8458,612
3,445832
50.39.7
%
Total
$
57,95252,246
$
47,78053,607
$
10,172(1,361)
21.3(2.5)
%
First Quarter – Fiscal 2024 vs. Fiscal 2023
Specialty egg expense
-
Specialty
egg
expense
decreased
primarily
due
to
a
reduction
in
franchise
fees
to
Eggland’s
Best,
Inc.
as
well
as
reduced sales volume of specialty eggs.
Delivery expense
-
The decreased delivery expense is primarily due to a decrease in fuel and contract trucking expenses in the first quarter
of fiscal 2024 compared to the first quarter of fiscal 2023.
Payroll, taxes and benefits expense
-
The increase
in payroll,
taxes and
benefits expense
is due
to an
increase in
salaries and
wages compared
to the
first
quarter of fiscal year 2023.
Other expense
-
The increase in
other expense is
primarily due an
increase in legal
fees in the
first quarter of
fiscal 2024 compared
to
the first quarter of fiscal 2023.
 
 
 
 
 
 
 
 
 
25
Second Quarter – Fiscal 2023
vs. Fiscal 2022
Specialty egg expense
-
Specialty egg
expense, which includes
franchise fees, advertising
and promotion
costs, generally
aligns with specialty
egg volumes,
which were
up 24.1% for
the second
quarter of
fiscal 2023
compared to
the same
period of fiscal
2022.
However, our
specialty egg expense
only increased by
2.9%, primarily due
to increased sales
to other Eggland’s
Best,
Inc. (“EB”) franchisees, including
unconsolidated affiliates, Specialty
Eggs, LLC and Southwest Specialty
Eggs, LLC.
These franchisees were
responsible for the
franchise fees, advertising
and promotion costs associated
with those sales,
which resulted in reduced costs for us.
Delivery expense
-
The increased delivery expense is primarily due to the increase in contract trucking.
Payroll, taxes and benefits expense
-
The
increase
in payroll,
taxes and
benefits
expense
is due
to
an
increase
in
the accrual
for
anticipated
performance-
based bonuses.
Other expense
-
The increase in other
expense is primarily due
to increased legal expenses
of approximately $2.6 million
in the second
quarter of fiscal 2023 compared to the second quarter of fiscal 2022.
Twenty-six Weeks
Ended
November 26, 2022
November 27, 2021
$ Change
% Change
Specialty egg expense
$
27,740
$
27,977
$
(237)
(0.8)
%
Delivery expense
38,091
28,331
9,760
34.4
%
Payroll, taxes and benefits
24,814
21,242
3,572
16.8
%
Stock compensation expense
2,012
1,976
36
1.8
%
Other expenses
18,902
14,779
4,123
27.9
%
Total
$
111,559
$
94,305
$
17,254
18.3
%
Twenty-six weeks –
Fiscal 2022 vs. Fiscal 2021
Specialty egg expense
-
Specialty egg
expense, which includes
franchise fees, advertising
and promotion
costs, generally
aligns with specialty
egg
volumes,
which
were
up
29.4%
for
fiscal
2023
compared
to
fiscal
2022.
However,
our
specialty
egg
expense
decreased
by
0.8%,
primarily
due
to
increased
sales
to
other
Eggland’s
Best,
Inc.
(“EB”)
franchisees,
including
unconsolidated affiliates, Specialty
Eggs, LLC and Southwest Specialty
Eggs, LLC. Additionally,
the higher prices for
conventional
eggs
and
the
comparatively
lower
prices
for
specialty
eggs
diminished
the
need
to
promote
specialty
eggs;
as
a
result,
EB
temporarily
reduced
the
related
franchise
fees
for
certain
specialty
egg
products
to
encourage
continued production of these products.
Delivery expense
-
The increased
delivery expense
is primarily
due to
the increase
in fuel
and labor
costs for
both our
fleet and
contract
trucking.
Payroll, taxes and benefits expense
-
The
increase
in
payroll,
taxes
and
benefits
expense
is
primarily
due
to
an
increase
in
the
accrual
for
anticipated
performance-based bonuses and increased wages for all employees
due to the inflationary market.
Other expenses
-
The increase in other expense is primarily due to increased
legal expenses of approximately $3.5 million.23
OPERATING
 
INCOME (LOSS)
For
the
second
first quarter
 
of
fiscal
2023,
2024, we
 
recorded
operating
income
loss of
 
$259.9
6.8 million
compared
to
 
operating income of $163.9
 
loss
of
$2.1million
million for the same period of fiscal 2022.
26
For
the
twenty-six
weeks
ended
November
26,
2022,
we
recorded
an
operating
income
of
$423.7
million
compared
to
an
operating loss of $41.7 million for the same period of fiscal 2022.2023.
OTHER INCOME (EXPENSE)
 
Total
 
other
 
income
 
(expense)
 
consists
 
of
 
items
 
not
 
directly
 
charged
 
or
 
related
 
to
 
operations,
 
such
 
as
 
interest
 
income
 
and
expense, royalty income, equity income or loss of unconsolidated
entities, and patronage income, among other items.
For the second first
quarter of fiscal 2023,
 
fiscal 2024, we earned $2.1 million of interest income compared to $207 thousand
 
for the same period
of fiscal 2022.
The increase resulted
from significantly
higher investment balances.
The Company recorded
interest expense of
$143 thousand and $78 thousand for the second quarters ended November
26, 2022 and November 27, 2021, respectively.
For the
twenty-six weeks
ended November
26, 2022,
we earned
$3.1 $7.5 million
 
of interest income
 
income compared
to $497$1.1
 
million for
the
 
same period of
period
of
fiscal
 
2022.2023.
 
The
 
increase
 
resulted
 
from
 
significantly
 
higher
 
investment
 
balances.balances
and
higher
interest
rates.
 
The
 
Company
recorded interest
 
recorded
interest expense
of $291
thousand and
 
$136142 thousand
for the
twenty-six weeks
ended November
26, 2022
 
and November$148
 
27,
2021, respectively.
Other,
netthousand for
 
the secondfirst
 
quarterquarters ended
 
November 26,September 2,
 
2022, was2023 and
 
income
of $1.1
million compared
to income
of $1.9
millionAugust 27,
for the same period of fiscal 2022.
Other, net for
the twenty-six weeks ended November
26, 2022, was income of $1.3
million compared to income of $7.0
million
for the
same period
of fiscal
2022. The
majority of
the decrease
is due
to our
acquisition in
fiscal 2022
of the
remaining 50%
membership
interest
in
Red
River
Valley
Egg
Farm,
LLC
(“Red
River”)
as
we
recognized
a
$4.5
million
gain
due
to
the
remeasurement
of
our
equity
investment,
along
with
the
$1.4
million
payment
received
in
fiscal
2022
related
to
review
and
adjustment of our various marketing agreements.respectively.
INCOME TAXES
For the
second first quarter
of fiscal
 
2023,
2024, pre-tax income
was $262.2
million$733 thousand
 
compared to
$468 thousand
$165.5 million for the
 
same period
of fiscal
fiscal 2022.
2023. We
 
recorded income tax expense of $322
 
thousand for the first quarter of
fiscal 2024, which reflects an effective
tax rate
of 43.9%.
Income tax expense
 
of $64was $40.3 million
 
million for the comparable
 
period of fiscal
2023, which reflects
an effective tax
rate
of 24.4%.
The increase
in the second
effective
tax rate
for first
 
quarter of
 
fiscal 2023,2024
 
which reflectsis primarily
 
an effective
tax
rate
of
24.4%.
We
recorded
an
income
tax
benefit
of
$677
thousand
in
the
prior
year
period
which
includes
a
$520
thousand
discrete
tax
benefit
related
due to
 
the loss
 
Internalattributable to
 
Revenueour
Service
(IRS)
adjustments
associated
with
noncontrolling interest. Taxable income for the
 
Company’s
previously recognized research and development tax benefits.
For the
twenty-six
weeks ended
November 26,
2022, pre-tax
income was
$427.7 million
compared to
a pre-tax
loss of
$33.4
million for
the same
period of
fiscal 2022.
We
recorded income
tax expense
of $104.3
million which
reflects an
effective tax
rate
of
24.4%.
We
recorded an
income
tax benefit
of $16.5
million
in
the prior
year
period,
which
includes
the discrete
tax
benefit of $8.3
million in connection
with the Red
River acquisition.
Excluding the discrete
tax benefit, income
tax benefit for
the comparable periodfirst quarter of fiscal 20222024 was $8.2$1.2 million withand excludes the loss
attributable to
noncontrolling interest of $515 thousand, which represents an adjusted
effective tax rate of 24.6%25.7%.
At September 2, 2023, the Company had an income tax receivable of $33.8 million compared to an income tax receivable of
$67.0 million at June 3, 2023. The change is primarily due to receipt during the first quarter of fiscal 2024 of a $33.2 million
federal tax refund plus associated federal interest income related to the carryback of fiscal 2021 taxable net operating losses.
Our effective tax rate differs
 
rate differs from
the federal statutory income tax rate
 
tax rate due to
state income taxes, certain
 
federal tax credits and
certain
 
items
 
included
 
in
 
income
 
for
 
financial
 
reporting
 
purposes
 
that
 
are
 
not
 
included
 
in
 
taxable
 
income
 
for
 
income
 
tax
purposes,
 
including
 
tax
 
exempt
 
interest
 
income,
 
certain
 
nondeductible
 
expenses
 
and
 
net
 
income
 
or
 
loss
 
attributable
 
to
 
our
noncontrolling interest.
NET INCOME ATTRIBUTABLE
 
TO CAL-MAINE FOODS, INC.
Net
income
attributable
to
Cal-Maine
Foods,
Inc.
for
the
second
quarter
ended
November
26,
2022,
was
$198.6
million,
or
$4.08
per
basic
and
$4.07
per
diluted
common
share,
compared
to
net
income
attributable
to
Cal-Maine
Foods,
Inc.
of
$1.2
million or $0.02 per basic and diluted common share for the same period of
fiscal 2022.
Net income
 
attributable to
 
Cal-Maine Foods,
 
Inc. for
 
the twenty-sixfirst
quarter ended
September 2,
2023, was
$926 thousand,
or $0.02
per basic and
diluted common share,
compared to net
income attributable to
Cal-Maine Foods, Inc.
of $125.3 million
or $2.58
per basic and $2.57 per diluted common share for the same period of fiscal 2023.
LIQUIDITY AND CAPITAL RESOURCES
Working Capital and Current Ratio
Our working capital
at September 2,
2023 was $937.7 million,
compared to $942.2
million at June
3, 2023. The
calculation of
working capital
is defined
as current
assets less
current liabilities.
Our current
ratio was
8.4 at
September 2,
2023, compared
with 6.2 at June 3, 2023. The current ratio is calculated by dividing current assets by current liabilities.
Cash Flows from Operating Activities
For the
thirteen weeks
ended September
2, 2023,
$23.7 million
in net
cash was
provided by
operating activities,
compared to
$172.8
million
provided
by
operating
activities
for
the
comparable
period
in
fiscal
2023.
The
decrease
in
cash
flow
from
operating activities resulted primarily from lower selling prices for conventional eggs compared to the prior-year period.
Cash Flows from Investing Activities
We
continue to
invest in
our facilities,
with $26.7
million used
to purchase
or construct
property,
plant and
equipment for
the
thirteen weeks ended
September 2, 2023,
compared to $27.7
million in the
same period of
fiscal 2023. Sales
and maturities of
investment
securities
were
$135.8
million
in
the
first
quarter
of
fiscal
2024,
compared
to
$20.3
million
in
fiscal
2023.
The
24
increase in sales
and maturities of
investment securities is
primarily due to
the maturities of
short-term investments during
the
period.
Cash Flows from Financing Activities
We
paid
dividends of
$37.0 million
for
the thirteen
 
weeks ended
 
November 26,September 2,
 
2022, was2023 compared
 
$323.9 to $36.7
million
 
or
$6.66 perin the
 
basic andsame
prior-year period.
As of September 2, 2023,
 
$6.63 percash increased $67.5 million since June
 
diluted share,3, 2023, compared to an
 
compared to
net loss
increase of $16.9
$76.9 million or
$0.34 per
basic and
diluted share
forduring the
same period of fiscal 2022.2023.
Credit Facility
We
had no long-term
debt outstanding at
September 2, 2023
or June 3,
2023. On November
15, 2021, we
entered into a
credit
agreement
that
provides for
a
senior
secured revolving
credit
facility (the
“Credit
Facility”), in
an
initial aggregate
principal
amount
of
up
to
$250
million with
a
five-year
term. As
of
September 2,
2023,
no
amounts were
borrowed under
the
Credit
Facility. We
have $4.3 million in outstanding
standby letters of credit issued
under our Credit Facility for
the benefit of certain
insurance companies.
Refer to
Part II
Item 8,
Notes to
Consolidated Financial
Statements and
Supplementary Data,
Note 10
-
Credit Facility included in our 2023 Annual Report for further information regarding our long-term debt.
Material Cash Requirements
We
continue
to
monitor
the
increasing
demand
for
cage-free
eggs
and
to
engage
with
our
customers
in
efforts
to
achieve
a
smooth transition toward
their announced timelines
for cage-free egg
sales. The
following table presents
material construction
projects approved as of September 2, 2023 (in thousands):
Project(s) Type
Projected
Completion
Projected Cost
Spent as of
September 2, 2023
Remaining
Projected Cost
Cage-Free Layer & Pullet Houses
Fiscal 2024
54,702
23,221
31,481
Cage-Free Layer & Pullet Houses
Fiscal 2025
40,099
29,471
10,628
Feed Mill
Fiscal 2025
10,800
36
10,764
Cage-Free Layer & Pullet Houses
Fiscal 2026
38,883
24,623
14,260
Cage-Free Layer & Pullet Houses
Fiscal 2027
56,923
24,311
32,612
$
201,407
$
101,662
$
99,745
We believe our current cash balances, investments, cash flows from operations, and Credit Facility will be sufficient to fund our
current cash needs for at least the next 12 months.
IMPACT OF RECENTLY
ISSUED/ADOPTED ACCOUNTING STANDARDS
For
information
on
changes
in
accounting
principles
and
new
accounting
policies,
see
of the Notes to Condensed
Consolidated Financial Statements included in this Quarterly Report.
CRITICAL ACCOUNTING ESTIMATES
Critical accounting
estimates are
those estimates
made in
accordance with
U.S. generally
accepted accounting
principles that
involve
a
significant
level
of
estimation
uncertainty
and
have
had
or
are
reasonably
likely
to
have
a
material
impact
on
our
financial condition
or results
of operations.
There have
been no
changes to
our critical
accounting estimates
identified in
our
2023 Annual Report.
ITEM 3. QUANTITATIVE
AND QUALITATIVE
DISCLOSURES ABOUT MARKET RISK
There have been no material changes in our exposure to market risk during the thirteen weeks ended September 2, 2023 from
the information provided in Part II Item 7A Quantitative and Qualitative Disclosures About Market Risk in our 2023 Annual
Report.
25
ITEM 4.
CONTROLS
AND
PROCEDURES
Disclosure Controls and Procedures
Our disclosure controls
and procedures are
designed to
provide reasonable assurance
that information required
to be disclosed
by us in the reports we file
or submit under the Exchange Act is recorded,
processed, summarized and reported, within the time
periods specified
in the
Securities and
Exchange Commission’s
rules and
forms. Disclosure controls
and procedures
include,
without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports
that
we file or submit under
the Exchange Act is accumulated and
communicated to management, including our principal
executive
and
principal
financial
officers,
or
persons
performing
similar
functions,
as
appropriate
to
allow
timely
decisions
regarding
required disclosure. Based on an evaluation of our disclosure controls and procedures conducted by our Chief Executive Officer
and
Chief
Financial
Officer,
together
with
other
financial
officers,
such
officers
concluded
that
our
disclosure
controls
and
procedures were effective as of September 2, 2023 at the reasonable assurance level.
Changes in Internal Control Over Financial Reporting
There was no
change in our
internal control over
financial reporting that
occurred during the
quarter ended September
2, 2023
that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
27
LIQUIDITY AND CAPITAL
RESOURCES
Working
Capital and Current Ratio
Our working
capital at
November 26
2022 was $667.5
million, compared
to $476.8
million at
May 28,
2022. The
calculation
of working capital is defined as current assets less current
liabilities. Our current ratio was 3.2 at November
26, 2022, compared
with 3.6 at May 28, 2022. The current ratio is calculated by dividing
current assets by current liabilities.
Cash Flows from Operating Activities
For the twenty-six weeks
ended November 26, 2022,
$344.8 million in net cash
was provided by operating
activities, compared
to $15.5 million
used by operating activities
for the comparable
period in fiscal 2022.
The increase in cash
flow from operating
activities
resulted
primarily
from
higher
selling
prices
for
conventional
and
specialty
eggs
as
well
as
increased
volume
of
specialty
egg
sales,
partially
offset
by
increased
costs
of
feed
ingredients
and
processing,
packaging
and
warehouse
costs
compared to the prior-year period..
Cash Flows from Investing Activities
We
continue
to invest
in our
facilities,
with
$59.7
million used
to purchase
property,
plant
and
equipment
for
the
twenty-six
weeks ended November
26, 2022, compared
to $28.6 million in
the same period of
fiscal 2022.
Purchases of investments were
$152.4
million
in
the
second
quarter
of
fiscal
2023,
compared
to
$26.4
million
in
fiscal
2022.
The
increase
in
purchases
of
investments is primarily due to the increased cash provided by operating
activities noted above.
Cash Flows from Financing Activities
We
paid dividends of
$78.4 million for the
twenty-six weeks ended
November 26, 2022 compared
to no dividends for
the prior
year period.
As of
November 26,
2022, cash
increased $119.6
million since
May 28,
2022, compared
to a decrease
of $41.9
million during
the same period of fiscal 2022.
Credit Facility
We
had
no
long-term
debt
outstanding
at
November
26,
2022
or
May
28,
2022.
On
November
15,
2021,
we
entered
into
a
credit
agreement
that
provides
for
a
senior
secured
revolving
credit
facility
(the
“Credit
Facility”),
in
an
initial
aggregate
principal amount
of up to
$250 million with
a five-year
term. As of
November 26, 2022,
no amounts were
borrowed under
the
Credit Facility.
We
have $4.1 million
in outstanding standby
letters of credit,
issued under our
Credit Facility for
the benefit of
certain insurance
companies. Refer
to Part
II Item
8, Notes
to the
Financial Statements,
Note 10
– Credit
Facility included
in
our 2022 Annual Report for further information regarding our long-term
debt.
Material Cash Requirements
We
continue
to
monitor
the
increasing
demand
for
cage-free
eggs
and
to
engage
with
our
customers
in
efforts
to
achieve
a
smooth transition
toward their
announced timelines
for cage-free
egg sales.
The following
table presents
material construction
projects approved as of November 26, 2022 (in thousands):
Project(s) Type
Projected
Completion
Projected Cost
Spent as of November
26, 2022
Remaining
Projected Cost
Cage-Free Layer & Pullet Houses/Processing
Facility
Fiscal 2023
$
131,932
117,056
14,876
Cage-Free Layer & Pullet Houses
Fiscal 2023
24,640
23,325
1,315
Cage-Free Layer & Pullet Houses
Fiscal 2024
42,591
2,057
40,534
Cage-Free Layer & Pullet Houses
Fiscal 2025
95,806
22,526
73,280
$
294,969
$
164,964
$
130,005
We believe our
current cash balances, investments, cash flows from operations, and Credit Facility will be sufficient
to fund our
current cash needs for at least the next 12 months.
28
IMPACT OF
RECENTLY
ISSUED/ADOPTED ACCOUNTING STANDARDS
For
information
on
changes
in
accounting
principles
and
new
accounting
policies,
see
of the Notes to Condensed Consolidated Financial Statements included in this Quarterly
Report.
CRITICAL ACCOUNTING ESTIMATES
Critical accounting
estimates
are those
estimates
made
in accordance
with U.S.
generally
accepted
accounting
principles that
involve
a
significant
level
of
estimation
uncertainty
and
have
had
or
are
reasonably
likely
to
have
a
material
impact
on
our
financial
condition
or results
of operations.
There
have been
no changes
to our
critical accounting
estimates identified
in our
2022 Annual Report.
ITEM 3. QUANTITATIVE
AND QUALITATIVE
DISCLOSURES ABOUT MARKET RISK
There have been no material changes in our exposure to market risk during the
twenty-six weeks ended November 26, 2022
from the information provided in Part II Item 7A Quantitative and Qualitative
Disclosures About Market Risk in our 2022
Annual Report.
ITEM 4.
CONTROLS
AND
PROCEDURES
Disclosure Controls and Procedures
Our disclosure
controls and
procedures are
designed to
provide reasonable
assurance that
information required
to be
disclosed
by us in the reports
we file or submit
under the Exchange Act
is recorded, processed, summarized
and reported, within the
time
periods
specified
in
the
Securities and
Exchange
Commission’s
rules
and
forms. Disclosure
controls
and
procedures
include,
without limitation, controls and
procedures designed to ensure that
information required to be disclosed
by us in the reports that
we file or
submit under the
Exchange Act is accumulated
and communicated to
management, including our
principal executive
and
principal
financial
officers,
or
persons
performing
similar
functions,
as
appropriate
to
allow
timely
decisions
regarding
required disclosure. Based on an evaluation of our disclosure
controls and procedures conducted by our Chief Executive Officer
and
Chief
Financial
Officer,
together
with
other
financial
officers,
such
officers
concluded
that
our
disclosure
controls
and
procedures were effective as of November 26, 2022 at the reasonable
assurance level.
Changes in Internal Control Over Financial Reporting
There was no change
in our internal control
over financial reporting
that occurred during the
quarter ended November
26, 2022
that has materially affected, or is reasonably likely to materially affect,
our internal control over financial reporting.
29
PART
 
II. OTHER INFORMATION
ITEM 1.
 
LEGAL PROCEEDINGS
Refer
 
to
 
the
 
discussion
 
of
 
certain
 
legal
 
proceedings
 
involving
 
the
 
Company
 
and/or
 
its
 
subsidiaries
 
in
 
(i)
 
our
 
20222023
 
Annual
Report,
 
Part
I
 
Item
3
 
Legal
Proceedings,
 
and
Part
 
II
 
Item 8,
 
Notes
 
to
Consolidated
 
Financial
 
Statements
and
 
Supplementary
Data, Note
18: 16 - Commitments
and Contingencies,
and (ii)
in this Quarterly Report
 
Report in
of the Notes to Condensed Consolidated Financial Statements, which discussions are incorporated
herein by reference.
ITEM 1A.
 
RISK
FACTORS
There have been no material changes in the risk factors previously disclosed in the
Company’s 20222023 Annual
Report.
ITEM 2.
UNREGISTERED SALES
OF EQUITY
SECURITIES, USE
OF PROCEEDS,
AND ISSUER
PURCHASES
OF EQUITY SECURITIES AND USE OF
PROCEEDS
 
There wereThe following table is a summary of our first quarter 2024 share repurchases:
Issuer Purchases of Equity Securities
Total Number of
Maximum Number
Shares Purchased
of Shares that
Total Number
Average
as Part of Publicly
May Yet
 
no purchasesBe
of Shares
Price Paid
Announced Plans
Purchased Under the
Period
Purchased (1)
per Share
Or Programs
Plans or Programs
06/04/23 to 07/01/23
—
$
—
—
—
07/02/23 to 07/29/23
106
44.75
—
—
07/30/23 to 09/02/23
—
—
—
—
106
$
44.75
—
—
(1)
 
ofAs permitted under our Amended and Restated 2012 Omnibus Long-Term
 
Common StockIncentive Plan, these shares were withheld by us to satisfy tax withholding
 
made by
 
or on
behalf of
our Company
or any
affiliated
purchaser during
obligations for employees in connection with the
second quarter vesting of fiscal 2023.restricted common stock.
ITEM 6. EXHIBITS
Exhibits
No.
Description
3.1
3.2
31.1*
31.2*
32**
101.SCH*+
Inline XBRL Taxonomy
Extension Schema Document
101.CAL*+
Inline XBRL Taxonomy
Extension Calculation Linkbase Document
101.DEF*+
Inline XBRL Taxonomy
Extension Definition Linkbase Document
101.LAB*+
Inline XBRL Taxonomy
Extension Label Linkbase Document
101.PRE*+
Inline XBRL Taxonomy
Extension Presentation Linkbase Document
104
Cover Page Interactive Data File (formatted as Inline XBRL and contained
in Exhibit 101)
 
*
Filed herewith as an Exhibit.
 
**
Furnished herewith as an Exhibit.
+
Submitted electronically with this Quarterly Report.
 
 
3027
SIGNATURES
Pursuant to the
 
the requirements
of the
 
Securities Exchange Act
 
Act of 1934, the
 
the registrant has duly
 
duly caused
this report
 
to be signed
 
on
its behalf by the undersigned, thereunto duly authorized.
CAL-MAINE FOODS, INC.
(Registrant)
Date:
 
December 28, 2022October 3, 2023
/s/ Max P.
 
Bowman
Max P.
 
Bowman
Vice President, Chief Financial
Officer
(Principal Financial Officer)
໿
Date:
 
December 28, 2022October 3, 2023
/s/ Matthew S. Glover
Matthew S. Glover
Vice President – Accounting
(Principal Accounting Officer)
໿