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Dolph Baker Chairman & CEO
Max Bowman Vice President & CFO
Investor Presentation
3rd Quarter - 2020
2
FORWARD LOOKING STATEMENTSThis presentation includes forward-looking statements, which are allstatements other than historical facts, can be identified by use ofwords such as “expect,” “will,” and “anticipate,” and includestatements regarding expected operating results, acquisitiontransactions and potential effects of industry events or trends on ourbusiness. Important factors that can cause our results to differmaterially from those anticipated in the forward-looking statementsinclude egg prices and feed costs; changes in consumer demand orrequirements of major customers; unanticipated results ofacquisitions or joint ventures; ability to obtain eggs from outsideproducers; agricultural, regulatory and litigation risks; and otherfactors described in the cautionary language included in our filingswith the Securities and Exchange Commission, including in the “RiskFactors” section of our annual report on Form 10-K and subsequentfilings. We undertake no obligation to update any forward-lookingstatements.
3
CAL-MAINE FOODS PROFILE
We are the largest producer and marketer of shell eggs in the United States
• Founded in 1957 in Jackson, Mississippi
• Acquired Ralston-Purina egg operations
in 1972
• Completed 22 acquisitions since 1989
• Fully integrated egg producer
• Since 1996, publicly traded on NASDAQ
under symbol "CALM"
• FY 2019 U.S. fresh shell egg market
share - 19 percent
4
KEY INVESTMENT POINTS
• Largest egg producer and marketer in the United States
• Commitment to Sustainability
• Efficient, state-of-the-art operations
• Solid customer base of leading retail and food service companies
• Strong consumer demand for eggs
• Leading producer and marketer of high-margin specialty eggs
• Solid financial position
• Proven management team and systems
5
THE U.S. EGG INDUSTRY
Food Service Shell Eggs -19.6 Million Cases7.4%
Exports - 7.4 Million Cases2.8%
Retail Shell Eggs - 157.6Million Cases 59.5%
Further Processing - 80.1 Million Cases30.3%
Case = 30 dozen eggs
6
Period Ending
(in m
illio
ns) (in m
illions)
Net Sales Eggs Sold
2011 2012 2013 2014 2015 2016 2017 2018 2019$0
$200
$400
$600
$800
$1,000
$1,200
$1,400
$1,600
$1,800
$2,000
400
500
600
700
800
900
1,000
1,100
1,200
SALES HISTORY
7
CAL-MAINE LOCATIONS
Eggland's Best Franchise TerritoryIncluding Investment in Unconsolidated Entities
8
FULLY-INTEGRATED OPERATIONS
9
EGG PRODUCTION FACILITIES
Contractproduction9%
Company-owned 91%
Lake City, Florida
Total FlockAs of February 29, 2020
Layers 40.1 millionPullets and Breeders 9.9 million
10
COMPANY-OWNED FACILITIES
• State-of-the-art
• Fully automated
• Temperature controlled
• Labor efficient
• Located near customers
11
CAL-MAINE CUSTOMERS
Fiscal Year 2019
Retail 90%
Food Service 7%
Egg Products 3%
12
ToP 10 CUSTOMERS - FISCAL 2019Top 3 over 52%
1. Walmart and Sam's Club of Fiscal 2019 Sales2. H.E. Butt Co.3. Publix Super Markets4. Food Lion5. CCF Brands6. Eggs America (Sysco, US Foodservice, etc.)7. Wakenfern Food Corporation8. Aldi9. Costco10. C&S Wholesale GrocersTotal Top 10 Customers 69.8%
13
MONTHLY HEN INVENTORYM
illio
n H
ens F
irst D
ay o
f Mon
th
2014 2015 2016 2017 2018 2019 2020
Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec270,000
280,000
290,000
300,000
310,000
320,000
330,000
340,000
350,000
Source: USDA Chicken and Egg Report March 23, 2020
14
(Monthly average by fiscal year)
Urner Barry Southeastern Regional Large Egg Market Price
$0.72 $0.75
$0.93
$1.38
$1.21$1.12 $1.13
$1.22$1.35
$1.43$1.53
$1.79
$0.85
$1.49
$1.23$1.15
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
FY
TD
$0.00
$0.50
$1.00
$1.50
$2.00
ANNUAL EGG PRICES
Source: Urner Barry2020 Price updated through March 26, 2020
15
FEED INGREDIENT PRICESSo
y M
eal $
/ton C
orn $/bushel
Corn Soy Bean Meal
1/3/
2006
7/3/
2006
1/2/
2007
7/2/
2007
1/2/
2008
7/1/
2008
1/1/
2009
7/1/
2009
1/1/
2010
7/1/
2010
1/1/
2011
7/1/
2011
1/1/
2012
7/1/
2012
1/1/
2013
7/1/
2013
1/1/
2014
7/1/
2014
1/1/
2015
7/1/
2015
1/1/
2016
7/1/
2016
1/1/
2017
7/1/
2017
1/1/
2018
7/1/
2018
1/1/
2019
7/1/
2019
1/1/
2020
$0
$200
$400
$600
$800
$0
$2
$4
$6
$8
Source: Monthly Average of Daily Closing Prices per Chicago Board of Trade
16
FEED COSTS - CENTS PER DOZEN PRODUCED
4847
45
48
51
57
55
5354
49
46
4948
4344
4142
43
4140
43
3940
38 3839 39
4241
42 42 4241
4241
1Q12
2Q12
3Q12
4Q12
1Q13
2Q13
3Q13
4Q13
1Q14
2Q14
3Q14
4Q14
1Q15
2Q15
3Q15
4Q15
1Q16
2Q16
3Q16
4Q16
1Q17
2Q17
3Q17
4Q17
1Q18
2Q18
3Q18
4Q18
1Q19
2Q19
3Q19
4Q19
1Q20
2Q20
3Q20
30
35
40
45
50
55
60Feed ingredient Approximate change in
Approximate impact on feed costs per dozen
$ impact on production cost for the FY 2019
Corn $0.28 change per bushel $ 0.01 $ 8,767,050Soybean Meal $27 change in per ton $ 0.01 $ 8,767,050
17
GROWTH STRATEGY
▪ Pursue selected acquisitions of existing shell egg production and processing facilities in key locations and markets
▪ Enhance production capacity and efficiency
▪ Increase value-added specialty egg business including cage-free capacity
18
PURSUE ACQUISITION OPPORTUNITIES
▪ Leverage solid track record with completion of 22 acquisitions since 1989
▪ Extend ability to identify, execute and integrate additional operations
▪ Expand capabilities in existing markets and broaden geographic reach
▪ Enhance national presence and strengthen customer relationships
19
ACQUISITION OPPORTUNITIESCal-Maine Foods 44.99 S&R Egg Farm 4.53 Demler Brothers 1.50Rose Acre Farms 26.60 Sauder's Egg 4.50 Demler Enterprises 1.50Versova Holdings 21.10 National Food Corp. 4.00 Dutt & Wagner 1.44Hillandale Farms 20.00 Konos Inc. 3.40 Simpson's Eggs 1.35Daybreak Foods 14.00 Pearl Valley Eggs 2.90 Dakota Layers LLP 1.30Michael Foods 13.30 Esbenshade Farms 2.80 Sperry Farms 1.30Rembrandt Enterprises 11.90 Forsman Farms 2.60 J.S. West & Company/JEM Eggs 1.28MPS Egg Farms 10.90 Ritewood/Oakdell Egg Farms 2.60 3 Puglisi Brothers 1.27Center Fresh Group 10.80 Creighton Brothers 2.40 Mercer Landmark 1.25Prairie Star Farms 10.80 Sunrise Acres Egg Farm 2.31 Morning Fresh Farms 1.25Herbruck's Poultry Ranch 8.60 Giroux's Poultry Farm 2.25 Fassio Egg Farms 1.20Weaver Brothers 8.55 CHS 2.21 Hertzfeld Poultry Farms Inc. 1.05Opal Foods 7.79 Central Valley Eggs 2.20 Feather Crest 0.98Fremont Farms of Iowa 7.06 Kreher's Eggs 2.09 Chino Valley Ranchers/MCM Poultry 0.85Kreider Farms 6.08 Minnich Poultry 2.00 Colorado Eggs 0.80ISE America 5.80 Schipper Eggs LLC 1.85 Wilcox Farms 0.79Hickman's Egg Ranch 5.60 Heritage PMS/LaValle Egg Farms 1.70 Hidden Villa Ranch 0.70Sparboe Farms 5.58 Lathem Farms 1.67 Hillside Poultry Farms Inc. 0.70Gemperle Farms 5.10 Country Charm Eggs 1.64 Weber Family Farms 0.52Cooper Farms 5.00 Braswell Egg 1.60 Sunrise Farms LLC 0.50Sunrise Farms Inc. 5.00 Egg Innovations 1.60 Demler Egg Ranch 0.35Mid-States Specialty Eggs 4.94 Wenger Feeds/Duchland Farms 1.60 Vital Farms 0.30Wabash Valley Produce 4.66 Berne Hi-Way Hatchery Inc. 1.50
Total 342.28
Layers in Production, December 31, 2019, in millions Source: Egg Industry Magazine - February 2020
20
ACQUISITIONS
– Foodonics International, Inc. (dba Dixie Egg Company) - Acquired 2016
Includes capacity for 1.6 million laying hens and related feed production, milling and distribution facilities in Georgia and Florida as well as contract grower arrangements for an additional 1.5 million laying hens.
– Happy Hen Egg Farms, Inc. - Acquired 2017
Includes capacity for 350,000 laying hens and distribution facilities near Harwood and Wharton, Texas. Site designed for capacity of up to 1.2 million laying hens.
– Featherland Egg Farms, Inc. - Acquired 2018
Includes capacity for 600,000 laying hens, a feed mill and related production and distribution facilities near Marion, Texas.
21
RED RIVER VALLEY EGG FARM, LLC
Cal-Maine Foods and Rose Acre Farms entered a production joint venture to build a cage-free shell egg production complex near
Bogata, Red River County, Texas
▪ Provides for capacity of approximately 1.8 million
laying hens, with permits for up to 2.9 million hens
▪ Production facilities fully online in 2017
▪ Enhances ability to meet growing demand for cage-
free and other specialty eggs
22
MAHARD EGG FARM, INC.
▪ On November 20, 2019 Cal-Maine Foods acquired certain assets of Mahard Egg Farm, Inc.
▪ Includes capacity for 3.9 million hens, feed mill, and related production facilities in Chillicothe, Texas, and Nebo, Oklahoma, and a distribution warehouse located in Gordonville, Texas.
▪ Sites are permitted for capacity of up to 8.0 million laying hens.
23
INCREASE VALUE-ADDED SPECIALTY EGG BUSINESS
▪ Offer nutritionally enhanced eggs, cage-free and organic eggs
▪ Meet consumer demand in rapidly growing segment
▪ Benefit from higher and less cyclical selling prices
▪ Through Q3 FY 2020, represented 23.8 percent of dozens sold and 40.3 percent of sales revenue
24
Dozen Eggs Sold (in millions)
805 821884
9481,014
1,063 1,054 1,031 1,038 1,039
116 132 144 156 174211
242 236 244 248
All Shell Eggs Specialty Eggs
FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 20190
200
400
600
800
1,000
1,200
SPECIALTY EGG SALES
25
CAGE-FREE COMMITMENT AND LEGISLATION
– Over 200 Companies have cage-free egg commitments over the next six years
State laws already passed or likely will be by next summer
– California - Michigan– Washington - Arizona– Colorado - Oregon– Hawaii - Maine
Cage-free estimated monthly U.S Egg Production - (March 2, 2020)
Certified Organic Cage-Free LayersEst. Layer Flock Size: 15,651,500Est. Lay Rate: 76.00%
Non-Organic Cage-Free LayersEst. Layer Flock Size: 53,966,000Est. Lay Rate: 76.00%
All Cage-Free LayersEst. Layer Flock Size: 69,617,500Est. Lay Rate: 76.00%
Layer Flock
26
INVESTMENT IN CAGE-FREE ▪ New capacity and conversions for cage-free hens, additional pullets and processing plants
and related equipment
▪ Preparing for California demand in 2020 and 2022 and nearest our customer base
▪ Invested over $344 million in facilities, equipment and related operations to expand our cage-free production starting with our first facility in 2008
Project(s) TypeProjected
CompletionProjected
CostSpent as of February
29, 2020Remaining
Projected CostCage-Free Pullet Houses Fiscal 2020 $ 6,331 $ 3,150 $ 3,181Convertible/Cage-Free Layer Houses & Pullet Houses
Fiscal 2021 31,701 17,457 14,244Cage-Free Layer & Pullet Houses/Processing Facility Fiscal 2022 87,204 28,793 58,411
$ 125,236 $ 49,400 $ 75,836
27
KEY STRENGTHS
Low Cost Producerl Fully-integrated operations in 16 states
l Focused on automation throughout the supply chain
Favorable Consumer Demand Trends l
Eggs taste great and provide an affordable and convenient source of protein
Attractive Growth Profile
l Solid track record of internal growth and acquisitions
l Increasing sales of high-margin specialty eggs
Solid Customer Base lLeading names of retail and institutional food service customers
Strong Balance Sheet l Solid financial position supports future growth
28
FINANCIAL HIGHLIGHTS - FISCAL YEAR 2019
2019 Sales - $1.4 billion
2019 EBITDA - $118 million down from $168 million in 2018
Working Capital - $493 million
Total Debt - $2.3 million
Debt to EBITDA - 0.02:1
29
INCOME STATEMENT - YEAR TO DATE
(Unaudited; in thousands except per share amounts) 39 Weeks Ended
February 29, 2020 March 2, 2019Net sales $ 898,276 $ 1,080,616Gross profit 58,078 210,105Operating income (loss) (74,823) 76,202Other income, net 17,331 22,546Income (loss) before taxes (57,492) 98,748Net income (loss) $ (42,072) $ 73,989
Net income (loss) per common share:Basic $ (0.87) $ 1.53Diluted $ (0.87) $ 1.52
Weighted average shares outstanding:Basic 48,455 48,416Diluted 48,455 48,545
30
OPERATING HIGHLIGHTS - YEAR TO DATE
39 Weeks Ended
February 29, 2020 March 2, 2019
Dozen Eggs Sold (000) 786,727 784,128
Dozen Eggs Produced (000) 684,837 654,380
% Specialty Sales (dozen)* 22.5% 24.0%
% Specialty Sales (dollars)* 38.0% 34.8%
Net Average Selling Price (dozen) $ 1.107 $ 1.331
Net Average Selling Price Specialty Eggs (dozen)* $ 1.876 $ 1.935
Feed Cost (dozen) $ 0.411 $ 0.416
* Excluding co-pack specialty
31
BALANCE SHEET HIGHLIGHTS
February 29, 2020
June 1, 2019
Cash and short-term investments $ 148,616 $ 319,428
Total assets $ 1,117,029 $ 1,156,278
Shareholders' equity $ 948,032 $ 989,806
Working capital $ 355,710 $ 492,846
• On July 10, 2018, we entered into a $100.0 million Senior Secured Revolving Credit Facility, which provides additional financial flexibility to support our growth strategy
32
Net
Sal
es
Operating Incom
e
Annual Net Sales and Operating Income ($ in millions)
Net Sales Operating Income
2012 2013 2014 2015 2016 2017 2018 20190
500
1,000
1,500
2,000
2,500
-600
-300
0
300
600
900
DozenEggs Sold
(in millions)884 948 1,014 1,063 1,054 1,031 1,038 1,039
FINANCIAL SUMMARY
33
CASH USE PRIORITIES
• Variable Dividend1/3 of Net Income Paid Quarterly
(after recovery of losses)
• Selective Acquisition of Existing Capacity
• Capital expansion to meet customer cage-free requirements
• At the end of the third quarter of fiscal 2020, the amount of cumulative losses to be recovered before payment of a dividend was $61.9 million
34
CASH DIVIDENDS PAID*C
ents
per
sha
re
*Cents per share, as adjusted for October 31, 2014, two-for-one stock split
8
1922
7 9
24
15
3
11
24
52
16 18
26
710
21
3
18
30
2219
25
3532
98
75
44
35
9
15
27
1Q092Q09
3Q094Q09
1Q102Q10
3Q104Q10
1Q112Q11
3Q114Q11
1Q122Q12
3Q124Q12
1Q132Q13
3Q134Q13
1Q142Q14
3Q144Q14
1Q152Q15
3Q154Q15
1Q162Q16
3Q164Q16
1Q172Q17
3Q174Q17
1Q182Q18
3Q184Q18
1Q192Q19
3Q194Q19
1Q202Q20
3Q20
0
20
40
60
80
100
120
35
STOCK OWNERSHIP AND FLOAT
Holdings as of August 31, 2019
OwnershipShares
Outstanding % of TotalShares Owned by Adams/Baker Family
(Excludes ESOP) 16,182,512 33.2 %
Shares Owned by Other Insiders(Excludes ESOP) 191,774 0.4 %
Shares Owned by ESOP 2,148,416 4.4 %
Public Float 30,170,638 62.0 %
Total Outstanding Shares 48,693,340 100.0 %
Cal-Maine Foods is a "controlled company" as defined in Rule 5615(c)(1) of NASDAQ's listing standards due to the Adams family's beneficial ownership of 65.5% of total voting power of all Common Stock and Class A Common Stock
36
Largest egg producer and marketer in the United States
Commitment to Sustainability
Efficient, state-of-the-art operations
Solid customer base of leading retail and food service companies
Strong consumer demand for eggs
Growing market for high-margin specialty eggs
Solid financial position
Proven management team
KEY INVESTMENT POINTS