Executive Summary

Revenue increased to $347.3M (+11.5% YoY) with a return to profitability at $0.25 diluted EPS vs ($0.21) YoY as retail demand stayed strong, while foodservice remained below pre-pandemic levels .
Dozens sold hit a second-quarter record at 273.7M (+4.8% YoY) and production-to-sales ratio reached a quarterly high of 92.1%, supporting improved operating leverage despite holiday pricing lacking a typical spike .
Specialty eggs revenue rose to $134.1M (39.7% of egg sales), driven by a 17.7% increase in specialty dozens; cage-free investments continue with $405M deployed and $57.8M committed (including a $40.1M KY conversion) .
No dividend under the variable policy given cumulative losses to recover of $8.6M; management flagged rising feed costs from mid-quarter and ongoing volatility risk into 2H FY21 .
S&P Global consensus estimates were unavailable; therefore, beat/miss vs Street cannot be assessed this quarter (consensus data not retrieved from S&P Global).

What Went Well and What Went Wrong

What Went Well
- Record Q2 volume: “highest total dozens sold of any second quarter” at 273.7M (+4.8% YoY); production-to-sales ratio a quarterly high at 92.1% .
- Mix and specialty momentum: Specialty revenue $134.1M (39.7% of egg sales); specialty dozens +17.7%; demand benefitted from higher conventional prices .
- Profitability inflection: Operating income of $14.5M vs ($16.6M) YoY, aided by a 2.6% decrease in farm production cost per dozen ($0.019) and better feed conversion .
What Went Wrong
- Holiday pricing: No typical Thanksgiving seasonal spike; UB Southeastern Large peaked at $1.30 (Oct 8) then ended at $1.20, pressuring late-quarter price realization .
- Foodservice still weak: Demand “well below pre-pandemic levels,” limiting pricing power even as retail remained strong .
- Feed cost headwinds emerging: Feed costs started trending higher mid-quarter; volatility expected due to export demand (corn/soy), COVID-19 supply chain issues, weather, and trade/tariff uncertainties .

Financial Results

Multi-period comparison (oldest → newest)

Metric	Q4 FY2020	Q1 FY2021	Q2 FY2021
Revenue ($M)	$453.3	$292.8	$347.3
Gross Profit ($M)	$121.5	$16.8	$58.5
Operating Income ($M)	$76.1	($27.2)	$14.5
Net Income ($M)	$60.5	($19.4)	$12.2
Diluted EPS ($)	$1.24	($0.40)	$0.25
Gross Margin % (calc)	26.8% (from $121.5/$453.3)	5.7% (from $16.8/$292.8)	16.8% (from $58.5/$347.3)
Operating Margin % (calc)	16.8% (from $76.1/$453.3)	-9.3% (from -$27.2/$292.8)	4.2% (from $14.5/$347.3)
Net Margin % (calc)	13.3% (from $60.5/$453.3)	-6.6% (from -$19.4/$292.8)	3.5% (from $12.2/$347.3)

YoY snapshot for the current quarter

Metric	Q2 FY2020	Q2 FY2021
Revenue ($M)	$311.5	$347.3
Diluted EPS ($)	($0.21)	$0.25

Segment/Mix and Pricing

Metric	Q4 FY2020	Q1 FY2021	Q2 FY2021
Specialty Egg Revenue ($M)	$133.3	$129.2	$134.1
Specialty % of Egg Sales (by $)	29.9%	45.2%	39.7%
Net Avg Selling Price per Dozen ($)	$1.575	$1.078	$1.227
Specialty Net Price per Dozen ($)	$1.934	$1.880	$1.854

KPIs and Cost Drivers

KPI	Q4 FY2020	Q1 FY2021	Q2 FY2021
Dozens Sold (000s)	282,422	263,994	273,651
Dozens Produced (000s)	242,962	231,161	251,914
% Specialty Sales (dozen)	24.4%	26.0%	26.4%
Feed Cost per Dozen ($)	$0.405	$0.388	$0.410

Notes: Gross/operating/net margin percentages are calculated by us from company-reported net sales and profit measures; inputs cited in each cell.

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue	FY2021	None provided	None provided	Maintained (no formal guidance)
Margins/OpEx/OI&E/Tax rate	FY2021	None provided	None provided	Maintained (no formal guidance)
Feed Costs (qualitative)	2H FY2021	N/A	Rising volatility expected given export demand for corn/soy, COVID supply chain, weather, and trade/tariffs	Cautionary outlook
Cage-free Capex/Capacity	Multi-year	Prior investments ongoing	~$405M invested to date; $57.8M committed incl. $40.1M KY conversion	Continued execution
Dividend (variable policy)	Q2 FY2021	Policy unchanged	No dividend; cumulative losses to recover before dividends = $8.6M	No dividend declared

CALM does not issue formal quantitative guidance; management provided qualitative commentary as above.

Earnings Call Themes & Trends

No Q2 FY2021 earnings call transcript was available in our source set; themes below are synthesized from management’s press releases for the current and prior two quarters.

Topic	Previous Mentions (Q4 FY2020, Q1 FY2021)	Current Period (Q2 FY2021)	Trend
Retail vs Foodservice Demand	Retail strong; foodservice recovering but below normal	Retail remained favorable; foodservice “well below pre-pandemic”	Stable retail; slower foodservice
Pricing/Seasonality	Q4 FY20 benefited from COVID/Easter spike; Q1 FY21 volatile, lower vs FQ4	No typical Thanksgiving spike; UB large peaked early and faded	Less seasonal uplift
Cage-free Transition	Ongoing multi-year investments; states’ mandates highlighted	$405M invested; $57.8M committed incl. KY conversion	Continued build-out
Feed Costs/Grain Markets	Q4 FY20/Q1 FY21 said supplies “favorable” but warned of volatility	Feed costs started trending higher mid-quarter; volatility expected	Worsening cost outlook
Supply/Hen Numbers	Hatch declines; fewer hens YoY	USDA hen count down 15.6M YoY (to 325.2M) as of Dec 1, 2020	Tightened supply persists
COVID-19 Operations	Emphasis on safety and continuity	Continued focus on safe operations and resilience	Ongoing

Management Commentary

“Our results… reflect favorable demand trends for shell eggs, primarily at the retail level… For the second quarter, total dozens sold were up 4.8%… highest total dozens sold of any second quarter… our ratio of total dozens produced to total dozens sold was the highest of any quarterly period at 92.1%.” — Dolph Baker, Chairman & CEO .
“Sales of specialty eggs totaled $134.1 million, accounting for 39.7% of our egg sales revenue… 17.7% increase in specialty dozens sold.” .
“We have invested approximately $405 million… and committed another $57.8 million… including the latest $40.1 million conversion project… in Guthrie, Kentucky.” .
“Farm production costs per dozen… decreased 2.6%… primarily due to slightly lower feed costs and more favorable feed conversion. However, feed costs started trending higher midway through the second quarter… increased export demand for both soybeans and corn is placing pressure on domestic supplies.” .
“We… will not pay a dividend with respect to the second quarter… As of November 28, 2020, the amount of cumulative losses to be recovered before payment of a dividend was $8.6 million.” .

Q&A Highlights

No earnings call transcript for Q2 FY2021 was available in our document set; therefore, Q&A themes and management responses could not be reviewed.

Estimates Context

S&P Global consensus estimates (revenue and EPS) for Q2 FY2021 were unavailable; as a result, we cannot assess beat/miss vs Street or estimate dispersion this quarter (consensus data not retrieved from S&P Global).

Key Takeaways for Investors

Retail demand remained robust, driving an 11.5% YoY sales increase and a return to positive EPS; however, lack of a holiday price spike and weaker foodservice tempered margins .
Specialty egg momentum and mix shift are clear positives (39.7% of egg sales; specialty dozens +17.7%), supporting structural margin resilience over time .
Volume execution was strong (record Q2 dozens sold; high production-to-sales ratio), aiding operating leverage even with pricing headwinds .
Feed cost inflation risk is rising into 2H FY2021 given grain export demand and supply chain uncertainties; margin volatility likely increases near term .
Cage-free capex commitment continues, positioning CALM for regulatory and customer mandates and potential share gains as demand migrates to cage-free .
Dividend remains on hold until cumulative losses are recovered ($8.6M at Q2-end), a near-term investor yield headwind but reflective of the variable policy discipline .
With no formal guidance and unavailable Street consensus, near-term stock moves will likely hinge on spot egg pricing, grain cost trends, and pace of foodservice recovery, with upside leverage to seasonal and mix improvements .

CAL-MAINE FOODS INC (CALM)·Q2 2021 Earnings Summary