Published on 15 Mar 2024 on Zacks via Yahoo Finance
CalMaine (CALM) Closes Tyson's Processing Plant Acquisition
CalMaine Foods, Inc. CALM announced the completion of the previously announced acquisition of Tyson Foods, Inc. TSN. It acquired a broiler processing plant, hatchery and feed mill in Dexter, MO. This move is in sync with CALM's growth strategy, which includes select acquisitions, along with organic growth initiatives.CalMaine Foods intends to repurpose the assets for the production of eggs and egg products. Initially, the egg producer will transform the broiler processing plant into an egg grading facility. The company sees potential growth with egg product processing capabilities, such as hard-cooked eggs.Cal-Maine Foods anticipates entering arrangements with some of Tyson's former contract farmers to convert their operations to support CALM's egg production operations.This deal will help CalMaine Foods expand its geographic footprint in Missouri and surrounding markets, and enhance its ability to serve customers. The company plans to make further investments in the facilities and the community in order to create job opportunities.As CALM expands its market reach, it stays committed to the effective and long-term management of existing and acquired operations, as well as addressing the demands of its customers.The company reported earnings per share of 35 cents in second-quarter fiscal 2024. The bottom line marked a roughly 91% slump from the prior-year quarter.Sales plunged 34.7% year over year to $523.2 million in the second quarter of fiscal 2024. The company reported exceptionally strong second-quarter fiscal 2023 sales of $802 million. The downside was driven by the substantial drop in the net average selling price of conventional eggs.However, sales volumes improved 1.4% year over year to 288.2 million total dozens sold in the second-quarter fiscal 2024.
Price Performance
CALM shares have gained 15.3% in the past year compared with the industry’s 4.8% growth.