Cal-Maine Reports Q3 2025 Results, to Acquire Echo Lake Foods
Cal-Maine Reports Foods, Inc. (NASDAQ: CALM), a leading producer and distributor of fresh shell eggs, has released its financial and operational results for the third quarter of fiscal 2025, which ended on March 1, 2025. Following the close of the quarter, the company also revealed it has entered into a definitive agreement to acquire Echo Lake Foods, Inc., a well-established producer of ready-to-eat egg products and breakfast foods.
Third Quarter Fiscal 2025 Highlights
Cal-Maine Foods reported robust financial results for the thirteen-week period, driven by record-setting sales volumes and high seasonal demand. The company posted net sales of $1.4 billion and net income of $508.5 million, or $10.38 per diluted share, a significant increase from the $146.7 million, or $3.00 per share, reported in the same quarter last year. The surge in net income and sales is attributed to a substantial increase in the average selling price of shell eggs, combined with higher volumes sold across both conventional and specialty egg categories.
Consumer demand remained strong throughout the quarter, helping the company achieve a record 331.4 million dozen shell eggs sold, a 10.2% increase from the prior-year quarter. This included 213.2 million dozens of conventional eggs (up 11.0%) and 118.1 million dozens of specialty eggs (up 8.8%).
The average net selling price per dozen eggs rose to $4.060, compared with $2.247 in the prior-year period, due to a combination of market-based pricing for conventional eggs and stable long-term pricing frameworks for specialty eggs.
Operational Gains Amid Supply Constraints
Despite industry-wide challenges due to highly pathogenic avian influenza (HPAI), Cal-Maine Foods implemented proactive strategies to address tight egg supply and strengthen its production base. These actions included:
- A 14% year-over-year increase in the average number of layer hens.
- A 33% increase in breeder flocks and a 24% rise in total chicks hatched.
- An expansion initiative expected to add 1.1 million cage-free hens and 250,000 pullets by the end of calendar year 2025.
- Facility recovery from HPAI-related shutdowns in Kansas and Texas.
- The successful conversion of a new egg processing facility and hatchery in Dexter, Missouri, which will contribute an additional 1.2 million free-range hens by year-end.
Cal-Maine also continued ramping up production from its recent acquisitions, including processing facilities from ISE America, Inc. and feed mills from Deal-Rite Feeds, Inc. Additionally, the company has invested more than $70 million in biosecurity improvements since 2015, reinforcing its commitment to long-term sustainability and risk mitigation.
A $500 million share repurchase program was approved to support the company’s strategic capital allocation plans, and a $170 million cash dividend (approximately $3.46 per share) was declared under its established dividend policy.
Echo Lake Foods Acquisition
In a strategic move to diversify its portfolio, Cal-Maine Foods has agreed to acquire Echo Lake Foods, Inc. for approximately $258 million, using available cash. Echo Lake Foods, based in Burlington, Wisconsin, produces and distributes a variety of value-added egg and breakfast products such as omelets, egg patties, waffles, pancakes, and more. In 2024, the company generated $240 million in annual revenues with a five-year compound annual growth rate (CAGR) of about 10%.
Echo Lake Foods will become a standalone business unit within Cal-Maine Foods. Its CEO, Kathy Brodhagen, will join Cal-Maine’s senior management team as President of Echo Lake Foods. The acquisition, expected to close by the end of fiscal 2025, has received board approvals from both companies and awaits customary regulatory clearance.
Strategic and Financial Impact
Cal-Maine sees the acquisition as a compelling opportunity to enter the value-added food segment of the egg industry, while expanding its reach into retail, quick-service restaurants, and foodservice channels. The combination will:
- Leverage Cal-Maine’s established distribution and logistics infrastructure.
- Provide immediate access to high-growth, ready-to-eat product categories.
- Deliver earnings accretion starting in fiscal 2026, with an expected return on equity exceeding the company’s cost of capital.
Echo Lake Foods’ four Midwest-based production facilities are ideally located to enhance Cal-Maine’s supply chain efficiency. Together, the companies aim to build on their shared values of quality, operational excellence, and customer service.
CEO Sherman Miller emphasized that the acquisition aligns with Cal-Maine’s disciplined investment criteria and its mission to be the most sustainable and reliable supplier of eggs in the U.S. “This transaction marks a meaningful milestone as we continue diversifying our offerings and growing our national footprint,” Miller said.
Echo Lake CEO Kathy Brodhagen added, “Joining Cal-Maine opens the door to exciting opportunities. Our teams are united by a shared focus on delivering high-quality, nutritious egg products to American families.”
