Cal-Maine Foods Inc (NASDAQ:CALM) stock rose 11.13% (As on March 29, 11:21:49 AM UTC-4, Source: Google Finance) after the company posted better than expected results for the third quarter of FY 23. The results are reflective of a dynamic market environment with higher average selling prices and favorable demand. Elevated market pricing continues, primarily due to the impact of the ongoing epidemic of highly pathogenic avian influenza (“HPAI”), which has significantly reduced the nation’s egg-laying capacity. At the same time, consumer demand for shell eggs remained robust in the third quarter, which included the peak winter holiday season. The Cal-Maine Foods’ team has delivered more eggs to meet the needs of the customers during the quarter.

Meanwhile, Conventional egg net average selling price per dozen increased to $3.678 for the third quarter of fiscal 2023 compared with $1.458 the prior-year quarter. Net average selling price for specialty eggs rose to $2.616 per dozen, compared with $1.923 per dozen for the third quarter of fiscal 2022. Specialty dozens sold were 35.7% of total dozens sold compared with 33.1% in the prior-year period.

For the third quarter of fiscal 2023, total dozens sold increased 1.3% to 291.4 million versus 287.7 million in the prior-year quarter, driven by higher sales volumes in the specialty eggs category. Conventional egg volumes sold decreased 2.7% compared with third quarter fiscal 2022, while specialty egg volumes sold increased by 9.4%. The Company reported operating income of $407.8 million for the third quarter of fiscal 2023 amidst a challenging environment with higher costs across various inputs including feed, labor, packaging, and distribution. Overall, farm production costs per dozen increased 18.2%, or $0.166, compared with the prior-year period, primarily tied to significantly higher feed costs. For the third quarter of fiscal 2023, feed costs per dozen were $0.679, a 20.8% increase compared with the third quarter of fiscal 2022. Supplies of corn and soybean remained tight relative to demand in the third quarter of fiscal 2023, as evidenced by a low stock-to-use ratio for corn, due to weather-related shortfalls in production and yields, ongoing supply-chain disruptions and the Russia-Ukraine war and its impact on the export markets.

CALM in the third quarter of FY 23 has reported the adjusted earnings per share of $6.62, beating the analysts’ estimates for the adjusted earnings per share of $4.78. The company had reported the adjusted revenue of $997.5 million in the third quarter of FY 23, beating the analysts’ estimates for revenue of $873.39 billion.

Furthermore, the company announced a cash dividend of approximately $2.20 per share.

For fiscal 2023, the Company expects continued corn and soybean upward pricing pressures and further market volatility to affect feed costs.