CAL-MAINE FOODS INC
For the period ended May 30, 2026. Filed Jul 22, 2026.
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FY2026 · Filed Jul 22, 2026
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Item 6. Reserved
ITEM
MANAGEMENT’S
DISCUSSION
AND
ANALYSIS
OF
CONDITION
AND
RESULTS
OF
OPERATIONS
FORWARD-LOOKING
For
to
important
risks
and
that
could
affect
our
,
results,
or
cash
flow,
reference
is
made
to
the
under
Part I. Item 1A. Risk
Factors
. In
because
the
following discussion
forward
-looking
our
cash flow,
reference is made
to the disclosure set forth
under
Part I. Item 1A.
and
to
the
in
the
section
of
Part
I
preceding
Item
1 above
under
the
caption
“
Forward-Looking Statements
.”
COMPANY
OVERVIEW
Cal
Inc. (“Cal
-Maine
Foods,”
the
“Company,”
“we,” “us,”
“our”)
is the
largest
egg company
in the
U.S.
and a
leading
player in
the
food
headquartered
With
a strong
footprint,
Cal-
Maine Foods
provides nutritious,
affordable,
and sustainable
protein to millions of households
every day.
In fiscal 2026, we sold
1.2 billion
dozen
shell
eggs.
Our
total
flock
as
of
May
30,
of
50.0
million
layers
and
14.5 million
pullets and
breeders is the
largest in the
U.S.
The
shell
egg
spans
the
full
egg
value
ladder
—from
to
brown,
pasture
-raised
and
eggs—serving
both
retail
and
nationwide.
Cal
-Maine
Foods
also
participates
in
the
growing
foods
sector,
with
such
as
egg
folded
and
egg
hard
-cooked
eggs,
and
wraps.
Our
branded
Best®,
Land O’Lakes®,
Eggs®,
4Grain®,
Van’s
®, MeadowCreek
and
We sell
our products to a diverse group
of customers, including
and regional grocery store chains, club stores,
servicing independent
in the
U.S.,
and foodservice
distributors
serving restaurants,
stores,
healthcare
and education
facilities, and
hotels
the majority
of the
aim to
efficient,
state
located
close to our customers.
Our
three
primary
priorities:
expanding
and
foods,
pursuing disciplined
growth
through acquisitions
and leveraging
our scale, vertical
integration,
excellence and financial
strength.
Throughout
our
history, we
have acquired
other businesses in our industry. Since
1989, we have acquired
and integrated
28 businesses, and within
the last
2 fiscal
years, we
have made
various acquisitions
aimed
at furthering
our
growth strategy.
of
our
Part I. Item 1. Business – Acquisitions
.
Our fiscal year end is
the Saturday
closest to May 31. The fiscal years
2026, 2025 and
2024 each included 52 weeks. All
references
herein to
a fiscal
year
means
and
all references to
a year
mean
a calendar
year.
Our operating results are materially
by market
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
feed grains
have a
negative impact
on our financial
results. Our
pricing for
shell
eggs
is
negotiated
with
our
on
individual
terms.
We
sell
our
at
prices
based
on
that
take
into
account,
in
varying ways, one of the independently
quoted regional wholesale market prices for shell eggs, our costs of production,
such as grain-based and
variations
of cost-plus arrangements, or hybrid models including cost of production
and wholesale market
prices.
Almost
all
of
our
shell
eggs
are
priced
and
sold
under
market
-based
or
the
hybrid
models
described above,
split almost evenly between such frameworks.
of our specialty shell eggs are
priced and sold under
that are based
on cost of production, although
we do have
some customers
that prefer market
-based pricing for
cage-
free
eggs. As
prices
typically do
not fluctuate
as much
as conventional
shell egg prices.
We
do not
sell eggs
directly to
or set the
prices at which eggs
are sold to
Retail sales of
shell eggs historically
highest during
the fall and winter
months
and lowest during
the summer
months.
Prices for
in response to
demand
factors and
a natural
spring
and early
summer.
Historically,
prices tend
start of the
school
year and
tend
to be highest
prior
to
holiday
periods,
Thanksgiving,
Christmas
and
Easter.
As
a
result,
we
have
experienced,
and
may
in the
future,
lower shell
egg selling
prices,
sales
volumes
and
sales (and
have
incurred, and
may
incur in
the future, net
losses)
in our first
and fourth
ending in August/September
and May/June,
Becaus
e
of
the seasonal
and quarterly
comparisons
of our sales and
results between different
within a single
are not
necessarily meaningful
Our
has
been greatly
by several
of HPAI
in recent
years.
HPAI
in 2015,
there were no
significant outbreaks
of HPAI
in the commercial
table
egg layer flocks
until February
through December
Thereafter,
there
were no HPAI
cases affecting
layers
until November
Since 2023,
of HPAI
have continued
to occur in
U.S. poultry flocks.
In 2024 and
2025, 40.2 million and 45.2 million commercial layer hens
were
depopu
lated
due to
HPAI,
To
date
in 2026,
through July
20,
2026,
19.2
million layer
hens and
pullets have
been depopulated
due to
HPAI.
An important
advantage
for Cal
-Maine Foods
is our ability to
meet
our customers’
evolving needs
with
a favorable
mix of
branded
and
private
-label products
and
cage-free, nutritionally
brown, pasture
-raised and
free-range eggs,
foods
and
description of
Part I. Item I. Business
.
The
Company
previously operated
as one
and
one reportable
segment. Effective
in the
fourth
quarter
2026,
determined its operations
are organized
into three reportable
segments:
(1) Conventional
Shell Eggs;
(2)
Shell Eggs; and (3) Prepared Foods.
As we have expanded
our prepared foods product
offerings throughout
these
align
with
how
the
reviews operating
results
and
makes
decisions
about
and strategic
initiatives. All
prior
fiscal year periods
recast to
reflect
the new reportable
on our
reportable segments,
see
Note 15 – Segment Reporting
in Part
II. Item
OVERVIEW
For fiscal
2026, we
of $2.9
billion and
of $316.7
We
recorded a
gross profit
of $672.0
million compared
to $1.9 billion
- The
decrease was
of a decrease
in the net
average
selling price
of
shell
eggs, primarily
shell egg prices, partially
offset
by an
of our
Foods segment.
Our
average
shell egg price
for
declined
50.9% compared
Average
shell egg price
per dozen declined
9.5% compared
to fiscal year 2025. Egg
prices declined
repopulation
of the egg layer
flock during fiscal
- According to the USDA, the size
of the layer hen flock was 312.0 million
hens at July 1, 2026, compared
to the five-year
average
of 308.0 million hens
.
American
Egg Board estimates
laying flock
as
of May
2026 at 340
–347
million
hens,
based
on
producer
data
collected
across
the
egg
above
USDA’s
published estimate
and
indicative
of abundant
egg supplies.
In fiscal 2026, prepared
foods accounted
for $244.8 million or 8.4% of our net sales. Prepared food sales for
fiscal 2026 increased
$240.8
million, compared
to our acquisition
of Echo
Lake
Foods in the
first quarter
prices
are
volatile,
cyclical,
and
by a
number
of
demand,
the
number
and
productivity
of
laying
hens
in
the
U.S.,
such
as HPAI,
severe
weathe
r
patterns
and
retailers go-to-market
strategies
and
how they
manage
their inventories.
We
believe the
recent
decline in
wholesale
egg prices
reflects
improved
egg
supply,
with HPAI
in
fiscal
year
to the prior fiscal
year,
panic
-driven purchasing
activity appears
to have subsided,
and improved
pipeline availability
relative
to the
prior
appears
to have
reduced
the need
for accelerated
purchasing
or inventory
builds by
retailers
and
operators.
As
wholesale
shell
egg
prices
have
declined,
while
retail
shell
egg
prices
have
more
gradually.
RESULTS
OF OPERATIONS
CONSOLIDATED
RESULTS
Ended
2026 Compared
to
2025 Compared
to
May
May
$
$
$
(31.7)
%
83.2
%
income
350,186
312,452
(77.2)
391.8
Total
other income
60,818
66,603
47,519
(8.7)
40.2
Income
tax
expense
92,892
384,910
83,689
(75.9)
359.9
Less:
1,430
(1,816)
(1,606)
(178.7)
13.1
to
Cal
Inc.
$
316,682
$
$
277,888
(74.0)
%
339.0
%
Net Sales
for fiscal year
2026 was
$2.9 billion
to $4.3
billion in
fiscal
2025,
of $1.3
billion or
31.7%.
The
was primarily
due to
the decrease
in
prices for conventional
as the
layer
recovered
in 2025
fro
m
the recent
HPAI
,
offset
by sales growth
due to
made
during fiscal
2026, particularly
Foods.
discussion, refer
to “Segment
Results” within this
for fiscal year
2025 were $4.3
billion compared
to $2.3 billion in fiscal
2024, an increase
of $1.9 billion
or 83.2%.
The
increase was
due
to the
prices
due
to a resurgence
of HPAI
in 2024
and
2025,
which decreased
supply.
regarding the HPAI
outbreaks,
.
Income
For fiscal 2026, operating
income was $350.2 million
to $1.5 billion
in fiscal 2025, a decrease
of $1.2 billion, or 77.2%.
The
was
due
to
in
prices
for
offset
by
a
in
price
and
volume
of outside
egg purchases. For further
discussion, refer
to “Segment
Results” within this
Operating income was $1.5 billion
in fiscal 2025 compared
to $312.5 million
in fiscal 2024, an increase
of $1.2 billion,
or 391.8%.
The increase
was primarily
due to higher net average
selling prices,
shell eggs, and higher
volumes,
lower feed
ingredient prices,
offset
by an
increase in volume
and
price of outside
egg purchase
s.
regarding shell egg and
feed prices, refer
to
Part I. Item 1. Business – Prices for Shell Eggs and Feed Costs
for Shell Egg Production.
Other Income
(Expense)
Total
other
income
(expense)
of
items
not
charged
to,
or
related
to,
such
as
income
and
expense,
equity in
income
or loss
of unconsolidated
entities, and
patronage
dividends, among
other items. Patronage
to us from
our membership
in the EB cooperative.
We
recorded interest
income
of $46.7
fiscal
2026, compared
to $48.7
fiscal
,
due to slightly
lower cash and
cash equivalents
-for-sale balances
as the Company
used these investments
for
.
We recorded
interest expense
of $556
and $612
in
and 2025,
related
fees under
our Credit Facility described
below.
We
recorded interest
income
of $48.7 million
in fiscal 2025,
of $16.4
million compared
to fiscal 2024, primarily
due
to significantly
higher
cash
and
cash
-for-sale balances
and yields. We
expense
of $612
in fiscal 2025
primarily related
fees under
our Credit Facility.
Income
Taxes
For fiscal 2026,
our pre-tax income
was $41
1.0 million, compared
to $1.6 billion
for fiscal 2025.
We
a tax provision
of $92.9
million for
fiscal
2026 compared
to $384.9
million
For
the primary
between
the
U.S.
rate
of
21%
and
the
rate
of
22.6%
was
related
to
state
income
taxes.
For
fiscal
2025,
the
primary
between
rate of 21%
and the
of 24.0%
related
to state
income
taxes, federal
tax
credits, and
certain non
-taxable and non-deduc
tible
items. For
fiscal 2024, income
tax expense
was $83.7 million
with an effective
tax
rate of
23.2%.
Items
causing
our
tax
rate to
differ
from
the
federal
income
tax
rate of
21% are
state
income
taxes,
certain
federal
tax
credits and
certain
items included
in income
or loss
for financial
that
are not
included in
taxable
income
or loss
for income
tax
purposes, including
tax
exempt
interest income,
certain
nondeductible
and
or loss
interest.
was
$1.4
million for
fiscal
2026 compared
to a
net loss
of $1.8
million and a
net loss $1.6 million for fiscal 2025 and
fiscal 2024, respectively. The increase in net income attributable
to noncontrolling interest
for fiscal 2026
as compared
was due
sales volume
of our
Crepini Foods of
406%.
Net Income
Attributable
to Cal
Inc.
to Cal
Inc.
was
$316.7
or $6.65
per basic
and
$6.63
per diluted
share, compared
to $1.2
billion,
or $25.04
per basic and
$24.95
per diluted share
for fiscal 2025.
to Cal
Inc.
for
fiscal
was $277.9
or
$5.70
per basic
and
$5.69
per diluted
share.
SEGMENT
RESULTS
Ended
to
to
May
May
$
1,348,076
$
2,755,859
$
1,247,292
(51.1)
%
120.9
%
Cost of
sales
1,059,179
1,393,212
970,031
(24.0)
%
43.6
and
72,256
72,644
63,560
(0.5)
%
14.3
$
216,641
$
1,290,003
$
213,701
(83.2)
%
503.6
%
$1.4 billion,
or 51.1%
due to
of 50.9%
for
shell
eggs,
in
a
$1.4
billion
in
net
sales.
Volumes
for
shell
eggs
were
relatively
flat
Cost of sales decreased
$334.0 million, or
24.0% compared
to fiscal 2025, primarily due
to a 23.8% decrease
in the cost
sold as total
volume sold
was relatively flat.
sold decreased
due to a decrease
in the
price and
volume
of outside
egg purchases
to the
prior fiscal year.
Net sales increased
$1.5 billion, or
120.9% in fiscal 2025
to an increase of
99.7
%
in
prices
for
which
in
a
$1.4
billion
in
net
sales,
and
a 10.6%
in
volume
dozens
sold, which resulted in a $132
.5 million increase in net sales
.
$423.2 million,
or 43.6% in
to fiscal 2024, primarily due a 29.8%
in the
cost per dozen
sold as well
as an increase
of 10.6%
in sales volume.
sold increased
due
to the increase
in the
average
price and volume
of outside egg
purchases, which
was partially
offset
by a 5.6% decrease
cost primarily driven
by lower feed
ingredient prices
as our
9.1%.
general, and
$9.1 million,
or 14.3%
2025 compared
to fiscal 2024,
primarily due to increased
delivery and employee
related costs. The increase in delivery costs related
to a 10.6% increase
in volume of conventional
shell eggs sold due to our acquisition of ISE America,
Inc. (“ISE”) and
our facilities in Chase,
KS and Farwell, TX returning
to full operations
in fiscal 2025 following
HPAI
in
the third and fourth
of
fiscal
Employee
related
costs
due
to
an
in
bonuses
to
fiscal
For
more
regarding our acquisitions,
in Part II. Item 8. Notes
regarding HPAI,
.
Ended
to
to
May
May
$
1,070,458
$
1,154,951
$
873,619
(7.3)
%
32.2
%
Cost of
sales
777,920
717,411
648,236
8.4
%
10.7
and
110,994
103,938
89,188
6.8
%
16.5
$
181,544
$
333,602
$
136,195
(45.6)
%
144.9
%
$84.5
or
7.3%
2025, primarily
due to
a
of 9.5%
of
a $112.6
million decrease
in net
sales, partially
offset
by a
2.4% increase
in specialty
dozens
sold, resulting in
a $28.
million increase
in net sales.
$60.5
million, or 8.4%
due to
a 5.9% increase
in the cost per
dozen sold
as well as an
increase of
2.4% in sales
volume.
sold increased
as our
specialty shell
egg mix
shifted
to higher cost
types.
Selling, general,
expenses increased
$7.1 million,
or 6.8% compared
due to
a
$4.7
million
in
fees.
In
fiscal
2025,
the
higher
prices
for
shell
eggs
to
specialty shell
eggs diminished the
need to promote specialty
shell eggs, during
which time,
EB temporarily reduced
the
related
fees
for
certain
shell
egg brands
to encourage
branded
eggs.
delivery charges
$2.3 million as
dozens sold
increased 2.4
%
Net
sales
$281.3
or 32.
2%
in
fiscal
due
to
an
of
20.7%
in volume of specialty shell eggs sold,
which resulted in a $180.9
million increase in net sales, and a 9.5% increase
of specialty
shell eggs, which
resulted in a
$100.5
million increase in net
sales.
Cost of sales increased $69.2
million, or 10.7% in fiscal 2025
to fiscal 2024, primarily due to a 20.7% increase
in sales volume,
partially offset
by an 8.3% decrease
in the cost per dozen sold.
sold decreased
due to a 8.3%
decrease in our production
costs primarily
driven by lower
feed ingredient
prices in
to fiscal 2024.
general, and
expenses increased
$14.8 million,
or 16.5%
in fiscal 2025 compared
to fiscal 2024,
due to
an
$11.1
million increase in delivery expense
resulting from
higher contract
trucking expenses
.
Foods
Ended
to
to
May
May
$
244,802
$
4,050
$
—
5,944.5
%
100.0
%
Cost of
sales
185,370
4,511
—
4,009.3
100.0
and
25,550
1,658
—
1,441.0
100.0
$
33,882
$
(2,119)
$
—
(1,699.0)
%
100.0
%
$240.8 million,
due to
the significant
of our
foods segment following
our acquisition
of Echo Lake Foods.
regarding our
in Part
II. Item
- Notes to Consolidated
$180.8 million compared
to fiscal 2025, primarily due to increased
resulting from the
of Echo
Lake
Foods.
general,
and
$24.1
to
fiscal
2025,
due
to
costs and
delivery charges
resulting from
of Echo
Lake
Foods.
$4.1
due to
of
Crepini during
fiscal
For
more
our
refer
to
in
Part
II.
Item
Notes
to
Cost of
sales increased
$4.5 million in fiscal
due to
of Crepini.
Sales,
general,
and
$1.7
million
in
fiscal
due
to
the
of Crepini.
Income
(Expenses)
Ended
to
to
May
May
income
$
19,044
$
42,091
$
33,566
(54.8)
%
25.4
%
SG&A
(a)
(108,353)
(127,141)
(94,516)
(14.8)
34.5
Gain (loss)
on involuntary
8,819
(156)
23,532
(5,753.2)
(100.7)
Gain (loss)
on disposal
assets
(1,391)
(26)
(637.1)
(1,096.2)
(a)
SG&A
of unallocated
costs, administrative
and
that
are not
directly related
or allocated
to the
Other –
segment
income
$23.0 million,
or 54.8
%
due to
a
decrease in
the
average
selling price of
our co-pack
egg sales as well as liquid and
frozen
SG&A
$18.8
million, or
14.8%, compared
due to
in
the accrual
for
bonuses
to the
prior
fiscal
year
as
well
as a
$15.0
million
adjustment
to
the
fair
value
of
with
the Fassio
Egg
Farms,
Inc.
(“Fassio”)
These
were
offset
by
of intangibles
that
were
from
our
during
fiscal 2026.
regarding our acquisitions,
in Part
II. Item 8. Notes
to
In fiscal
2026,
we recognized
$8.8
million of
gains from
conversions,
driven
by a
$7.5
million
gain recorded
in the first quarter
related to business
recoveries
with a weather
-related
event
that
occur
red in fiscal 2021.
Other –
segment
income
$8.5 million,
or 25.4%
due to
an
in volume
of liquid
egg
sold, primarily
related
to
of ISE,
which
a breaking
SG&A
increased $32.6 million
or 34.5% compared
to fiscal 2024, primarily
due employee related
costs which
due to
in employee
bonuses
and a $15.0
million adjustment
in
to a $5.5 million
adjustment
to increase the fair value of contingent
with the Fassio acquisition
and
professional
fees mainly
with $6.6 million
costs recorded
in the
fourth
quarter of
fiscal
2025 for
Foods acquisition.
These were
offset
by a
$19.6 million
in litigation
loss
accrual.
In
fiscal
2025,
loss
on
was
$156
to
a
$23.5
million gain
on
in fiscal 2024. The de
crease of $23.7
million was
to recoveries in
fiscal 2024
under indemnity
and
that
exceeded
the amortized
book
value
of the
covered
assets
and
our
direct costs,
related
to the
HPAI
at
our Kansas
and
Texas
facilities that
occurred in fiscal
.
LIQUIDITY
AND CAPITAL
RESOURCES
We aim to maintain
a strong balance sheet and liquidity, particularly
given the cyclical nature
of our business. We believe a
strong
balance
sheet supports our growth
opportunities
and stockholder
returns. Our priorities
for the
use of cash in
recent periods
have
included the payment
of dividends pursuant
to our variable dividend policy,
inorganic growth
through acquisition
s
of businesses,
organic
growth
and
of
and
in
value
-added
,
and
capital
expenditures.
Working
Capital
and
Current Ratio
Our
working
capital
at
May
was $1.4
billion,
to $1.7
billion
at
May
The
calculation
of
working
capital is
defined as
current assets
less current liabilities.
Our current
ratio was
7.7 at May
to 6.4 at
May 31,
- The current
ratio is calculated
by dividing current assets
by current liabilities.
The increase
in our current
ratio is primarily
due
to the
in
total
current
specifically
payable
,
which decreased
by $114.1
million
to
May
31,
.
Due
to
factors
described
in
Part I. Item I. Business – Seasonality
, we
expect
our
need
for
working
capital
to be highest in the
fourth
and
first fiscal quarters
ending in May/
June and
August/September,
Cash
Flows from
Operating Activities
Net
cash
by
was
$479.8
million
for
fiscal
2026,
to
$1.2
billion
for
fiscal
The
decrease in
cash flow from
operating activities
resulted primarily
from lower
net average
egg sales prices per
dozen,
shell eggs, partially offset
by the increase
in volume and
higher price of outside
egg purchases
in the prior fiscal
year
.
Cash
Flows Used in Investing
Activities
For fiscal 2026, $503.8
million was used in investing activities, primarily due to the acquisition
of assets of Echo Lake, Creighton,
and
other
as
well
as
sales
and
of
to
$575.5
million used
in
investing
in fiscal 2025,
due to
of investment
of property,
plant and
and the
of ISE
.
of investment
were
$648.9
fiscal
to $1.2
billion in
fiscal
Sales and
of
were
$745.2
million
in
fiscal
2026,
to $907.6
million
for
fiscal
Cash
paid
for
was
$427.8
million
in
fiscal
2026,
related
to
the
Echo
Lake
and
s,
and
$116.2
million
in
fiscal
2025,
related
to
the
ISE
of
property,
plant
and
were
$151.2
$161.3
million
and
2025, respectively,
reflecting
progress
on
our
projects.
Cash
Flows Used in Financing
Activities
We
paid
totaling
$231.6
million
and
$330.3
million
in
fiscal
and
2025, respectively.
We
$131.1
million in shares of Common
Stock in fiscal 2026, compared
to $54.0 million in fiscal 2025, primarily under our
See “Share
Program,” below.
in Cash
and
Cash
Equivalents
As of
May
30,
2026, cash
and
cash
$386.9
million
since
May
31,
2025, compared
to
a
$262.5
million
during
fiscal
- The
is primarily
due
to
the acquisitions
of
Echo
Lake
Foods,
Brothers,
LLC,
Clean
Egg, LLC,
and Van’s
Foods, totaling
$452.6 million.
Refer to
to the
Note 2 –
for further
regarding our recent
acquisitions.
On
15,
2021,
we
entered
into
an
Amended
and
Restated
(as
amended,
the “Credit
Agreement”),
expiring November
21, 2026. The Credit Agreement
provides for
a senior secured
revolving credit facility (the
“Credit Facility”),
up to $250 million.
As of May 30,
2026, no amounts
were borrowed under
the Credit Facility.
As of May 30,
2026, we had
$5.9
standby
letters of credit,
which were
issued under
our
for the
benefit
Refer to Part II. Item 8. Notes
to the Financial Statements,
Note 10 – Credit Facility
for further information
our long-term
debt.
Share Repurchase
Program
In February
2025,
Board
of Directors (“Board”)
a $500
million share repurchase
program
authorizes the
in management’s
discretion, to repurchase
shares of our
common
stock from
time
to time for
an aggregate
price up
to $500
million
(exclusive of
any fees,
taxes,
commissions
or other
related
to such
repurchases),
subject to
market
actual
timing, number
and value
under the program
will be determined
by management
in
its discretion and
will depend
on a number of factors,
including, but not
limited
to,
the
market
price
of
our
common
stock
and
general
market
and
The
Company
1,571,950
and 551,876
shares during fiscal 2026
and 2025,
under the program.
As of the end of fiscal
2026, we had
remaining authorization
up to
$320.7
million under the repurchase
expects to strategically
and
opportunistically
shares from
time to time
through solicited or unsolicited
in the open
market,
in privately
negotiated
or by other
means
with securities laws.
The
Company
expects that share
repurchases
under the program will be funded
from existing cash balances
and future
free cash flow.
The
share
program
does not
obligate
the
Company
to repurchase
any
specific amount
of shares,
does
an
expirati
on
date,
and
may
at
any
time
without
See
Part II. Item 5. Issuer
Purchases of Equity Securities
and
Item
- Notes to the
Note 11 – Equity
for further
.
with our variable
dividend policy,
we
will not
pay a cash
to holders
of our
Common
Stock with
respect
to our fourth
- The Company
will
not pay
a dividend for
is profitable
on a
basis
from
of the
last quarter
a
paid.
At the
end
of the
2026, the
amount
of cumulative
losses to be recovered
before
payment
of a
$35.9 million.
Material
Cash
Requirements
Material
cash
for operating
consist
of feed
and
costs,
related
costs,
capital
and
other
general
Our
cash
for growth capital
expenditures consist
of our construction
projects to increase
capacity of
and cage
-free shell egg production. We
believe our current
cash balances,
investments,
cash flows from
and
borrowings under
our
will be
sufficient
to fund
our
cash
needs for
at
least the
next
months
and to fund our capital commitments
currently in
place thereafter.
Future acquisitions of businesses may
require additional
financing.
IMPACT
OF RECENTLY
ISSUED ACCOUNTING
STANDARDS
For information
on changes
in accounting
and new accounting
principles, see
“
New Accounting
Pronouncements
and
Policies
” in Part II. Item
- Notes to Consolidated
Note 1 - Summary of Significant Accounting Policies
.
CRITICAL
ACCOUNTING
ESTIMATES
The preparation
of financial statements
in
with
U.S. GAAP requires
to make estimates
that affect
the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of
revenues
and expenses
during the reporting period. Actual results could differ
materially from
these estimates. Critical accounting
are those estimates
made
with
GAAP that
involve a significant
level of estimation
uncertainty
had or are
impact
on the
or results of operations.
Our critical accounting
are described
below.
Combinations
applies the acquisition
method
of accounting,
which requires
that once
control is obtained,
all the
assumed,
amounts
interests,
at
their respective
fair values
at
the
date
of acquisition.
The
excess
of
the
price
over
fair
values
of
assets
and
liabilities is
as
goodwill.
We
use
various
models
and
methods
to
the
fair
values
of
assets
and
such
as
and
bottom-up
for inventory,
cost method
and
market
for property,
relief-from-royalty
and
excess
earnings to
value intangibles.
in valuing
certain intangible
assets include,
but are not limited
to, the amount
and
timing of future
cash
flows, growth rates, discount
useful lives.
The
fair
values
of
assets
and
are
internally
and
and
the
use
of
various
techniques.
When
a market
value
is
not readily
available,
our
methodology
the
life of
and
is required
as management
determines
market
value
for those
assets.
Due
to
volatile
egg
prices
and
feed
costs,
unanticipated
market
changes,
events,
or
may
occur that
could affect
the estimates
and
used,
which could result in subsequent
impairments.
of eggs,
feed, supplies
and flocks
are valued
at the lower
of
cost or net
realizable
value. If
market
prices
for
eggs
and
feed
grains move
lower,
we
record
to write
down
the
values
of eggs
and
feed
inventories to
fair market
value. The cost associated
with flock inventories,
consisting principally
of chick purchases
or hatching
costs,
feed,
labor,
contractor
and
costs,
are
during
the
hatching
and
growing
periods
of
weeks. Capitalized
flock
costs
are
then
over
the
flock’s
life,
one
to
two
years. Judgment
exists in
the flock’s
life including
factors
such as
laying rate
and egg
size, molt
cycles,
and customer
demand
.
other factors
such as hen
type
or weather
could affect
the productive
life. These
factors
could make
our estimates of productive
life
differ
materially from
actual results. Flock mortality
is charged to cost of sales
as
incurred. High
from
disease
or
extreme
temperatures
will
result
in
abnormal
write-downs
to
flock
inventories.
continually
monitors
each
flock
and
to
take
appropriate
actions
to
minimize
the
risk
of
loss.
As a result
of acquiring
had $97.1
million of goodwill
as of
May 30,
2026, representing
3.1%
assets
and
3.7%
of
equity.
is
for
(or
more
frequently
if
arise) by first performing
a qualitative
to determine whether a quantitative
test is necessary
.
After
the totality
of events
or circumstances,
if we
it is
more likely
than
value
of a reporting
unit
is less
than
amount,
then
we perform
tests to determine
the
magnitude
of any
impairment.
During
our
annual
test,
which
was
the
first
day
of
the
fourth
we
that
passed
the
qualitative
and
no quantitative
of goodwill impairment
was necessary
in fiscal 2026.
As part
of the
change
to
our
2026,
the
of the
units were reallocated
to the new reporting units on a relative
fair value basis
as of the date of the reorganization.
of fair
value
involved the
use of
and
of goodwill,
performed
a
test, for
which
the
Company
fair
value
of
each
unit
exceeded
its
value
and
no
was
identified.
When
the
Company
acquires
a
new
location,
a
is made on how to
allocate
among
the reporting
units. See
Note 8 - Goodwill and Other Intangible Assets
for updated
disclosures regarding the
of goodwill.
Judgment exists
in management’s
of the qualitative
factors
which include macroeconomic
the current
egg
industry environment,
cost inputs such as feed ingredients
and overall financial
performance.
Furthermore, judgment
exists in the
of the
of
whether
it
is more
likely
than
the
fair
value
of
a
reporting unit
is less than
amount.
Uncertainty
exists due to
uncontrollable
events
that
could occur
that
could negatively
affect
our operating
Revenue
Recognition
Revenue
recognition
is
upon
satisfaction
of the
which
occurs
upon
shipment
or
delivery to
a customer
based
on terms
of the
sale.
Revenues
are
in
an
amount
that reflects
the net
we
expect
for
of the
products. The Company
periodically offers sales incentives
or other programs
such as rebates,
discounts,
coupons, volume
-based
incentives,
guaranteed
other programs.
The
Company
records an
for costs
which
as a reduction
in revenue
at the time
of sale
using
redemption
rates
of
each
The
Company
regularly
reviews
these
and
any
between
the
costs
and
actual
realization
would be recognized
in the
subsequent
period.
As the
noted
above
on historical information,
we do
not believe
that
there will
be a
change
in the
used to recognize revenue.
if actual
results varied significantly
from
our estimates,
it could
expose
us to material
gains or losses.
Loss Contingencies
evaluates
whether a loss
exists,
and if the
of a contingency
indicates
it is
probable that
a
material loss
has
been incurred
and the
amount
of the loss can
be reasonably
estimated,
loss would be accrued
in
the costs
of litigation as
they
are incurred.
accrued
$4.0 million in litigation
loss contingency
in fiscal 2026
and $19.6
fiscal 2024.
There
were no
loss contingency accruals
for fiscal 2025. Our evaluation
of whether loss
contingencies exist
primarily relates to litigation
matters.
The outcome
of litigation is uncertain due to,
among
other things, uncertainties
regarding the facts
that
will
be established
during
the
how
the
law
will
be
applied
to
the
facts
established,
and
the
calculation
of
any
damages
or the
costs
of
any
relief.
If
the
facts
discovered
or
the
change, future
accruals for
loss contingencies
may
be required. Results
may
be materially
by
losses or
a loss contingency
accrual
resulting from adverse
Income
Taxes
We
our
by estimating
our permanent
differences resulting
from
differing
treatment
of items
for tax
and accounting
purposes. Judgment
and uncertainty
exist with management’s
application
of tax regulations
and evaluation
of the
more-likely-than
-not recognition
and measurement
thresholds. We are periodically
audited
by taxing authorities.
An adverse
tax
a negative
impact
on our effective
tax
rate
and
our results of operations.
QUANTITATIVE
AND QUALITATIVE
DISCLOSURES
ABOUT
MARKET RISKS
The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.