By Katherine Hamilton

Cal-Maine Foods received a civil investigation demand from the Justice Department about its egg pricing as its fiscal third-quarter revenue doubled.

The egg maker said Tuesday revenue rose to $1.42 billion from $703.1 million the year before driven by an increase in the net average selling price of eggs, as well as higher volumes. Market prices were tied to a shortage in eggs caused by the avian flu, Cal-Maine said. The average selling price jumped to $4.06 a dozen compared with $2.25 a year ago.

The egg producer and distributor posted a profit of $508.5 million, or $10.38 a share, in the quarter ended March 1, compared with $146.4 million, or $3.00 a share, a year earlier.

Cal-Maine said it experienced strong demand for eggs in the quarter despite shortages related to an avian flu outbreak. The company sold about 331.4 million eggs in the quarter, a 10.2% increase from the year before.

The company increased the number of laying hens, breeder flocks and chicks hatched compared with the previous year to help mitigate the tight egg supply, it said.

"The extent of possible future outbreaks in commercial laying hens, with heightened risk during migration seasons, cannot be predicted," the Ridgeland, Miss., company said.

The bird flu, or highly pathogenic avian influenza, wiped out millions of hens, contributing to a spike in retail egg prices and drop in supplies. Costs related to feeding hens and meeting regulatory standards have also risen.

The Justice Department opened an investigation into the cause of soaring egg prices, including whether large producers have conspired to raise prices or hold back supply, The Wall Street Journal reported in March according to people familiar with the matter.

Cal-Maine provides about 21% of shell egg consumption in the U.S., according to its last annual report filed in July 2024.

Chief Executive Sherman Miller said the company is looking at diversifying its product mix to reduce financial volatility, though it plans to keep eggs as its core business.

The company also said Tuesday it plans to acquire Echo Lake Foods for $258 million, which produces and distributes ready-to-eat eggs, as opposed to Cal-Maine's focus on shell eggs. The deal would help Cal-Maine expand into a growing portion of the egg category, the company said.

Write to Katherine Hamilton at katherine.hamilton@wsj.com

(END) Dow Jones Newswires

By Katherine Hamilton

Cal-Maine Foods is coopering with a Justice Department investigation about the cause of soaring egg prices, including whether large producers have conspired to raise costs or hold back supply. Cal-Maine, which produces shell eggs, said Tuesday it is cooperating with the investigation.

The department sent a letter to some companies instructing them to preserve documents about their pricing conversations with customers, competitors and egg-price tracker Expana, the Wall Street Journal reported in March.

The rise in egg prices has been attributed to an outbreak of the avian flu, which wiped out millions of hens. Cal-Maine said it has taken steps to repopulate its supply, and is continuing to record soaring sales thanks to higher sticker prices and strong demand.

Cal-Maine said Tuesday revenue doubled to $1.42 billion in its fiscal third quarter. The higher revenue was primarily driven by an increase in the net average selling price of eggs, which jumped to $4.06 a dozen compared with $2.25 a year ago, the company said.

Profit was $508.5 million, or $10.38 a share, in the quarter ended March 1, compared with $146.4 million, or $3.00 a share, a year earlier.

Despite rising prices, Cal-Maine said it still experienced strong demand and sold about 331.4 million eggs in the quarter, a 10.2% increase from the year before.

The company has increased the number of laying hens, breeder flocks and chicks hatched to help mitigate the tight egg supply, it said.

"The extent of possible future outbreaks in commercial laying hens, with heightened risk during migration seasons, cannot be predicted," the Ridgeland, Miss., company said.

Cal-Maine provides about 21% of shell egg consumption in the U.S., according to its last annual report filed in July 2024.

Chief Executive Sherman Miller said the company is looking at diversifying its product mix to reduce financial volatility, though it plans to keep eggs as its core business.

The company also said Tuesday it plans to acquire Echo Lake Foods for $258 million, which produces and distributes ready-to-eat eggs, as opposed to Cal-Maine's focus on shell eggs. The deal would help Cal-Maine expand into a growing portion of the egg category, the company said.

Write to Katherine Hamilton at katherine.hamilton@wsj.com

(END) Dow Jones Newswires

April 08, 2025 17:15 ET (21:15 GMT)

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