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Wednesday, November 25, 2020

Cal-Maine Foods reports narrower than expected loss in Q1.

  • Cal-Maine Foods reports narrower than expected loss in Q1.
  • CEO Baker says retail demand showed resilience in recent months.
  • The board decided in favour of not paying a quarterly dividend.

Cal-Maine Foods Inc. (NASDAQ: CALM) published its earnings report for the fiscal first quarter on Monday that highlighted the company to have concluded Q1 with a narrower than expected loss. Its sales in the recent quarter also blew past Wall Street estimates.

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Shares of the company jumped close to 4% in premarket trading on Monday. Cal-Maine Foods is now exchanging hands at £30.20 per share versus a year to date low of £24 per share in March due to the Coronavirus pandemic. Trading stocks online is easier than you think. Here’s how you can buy shares online in 2020.

Cal-Maine’s Q1 financial results versus analysts’ estimates

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Cal-Maine said that its net loss in the first quarter came in at £15.04 million that translates to 31 pence per share. In the comparable quarter of 2019, it had posted a much broader £35.51 million of loss or 72.88 pence per share. In the prior quarter (Q4), Cal-Maine had registered £47.86 million of net income.

In terms of sales, the Jackson-based company reported £227 million for Q1 versus the year-ago figure of £187 million. According to FactSet, experts had forecast the company to print £220.20 million in revenue in the quarter that concluded on August 29th. Their estimate for the per-share loss was capped at 41 pence.

CEO Dolph Baker commented on the financial report on Monday and said:

“Our results for the first quarter of fiscal 2021 reflect continued challenging market conditions as we proactively monitor and manage our operations in the face of the COVID-19 pandemic.”

CEO Baker says retail demand showed resilience in recent months

The CEO further added that retail demand showed resilience in recent months as the health crisis continues to make people eat at home. In the first quarter, Cal-Maine noted a 3.8% annualised growth in total dozens of eggs sold. The company, however, acknowledged that demand from foodservice was still significantly weaker than pre-virus levels. But signs of recovery were now starting to appear. Baker said:

“Market prices for eggs remained volatile over the first quarter and decreased overall compared to prices at the end of fiscal 2020, which reflected increased consumer purchases due to the COVId-19 pandemic and seasonal demand due to Easter falling in the fourth quarter.”

The company’s board decided in favour of not paying a quarterly dividend. At the time of writing, the American fresh egg producer has a market cap of £1.47 billion and a price to earnings ratio of 102.87.

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