Cal-Maine Foods, Inc. Q3 FY2026 earnings call

• Appointed Dudley Woolley to board to fill vacancy left by Jim Poole. Dudley brings risk management and governance expertise. - Strategy focuses on expanding specialty eggs (larger portion of portfolio, stronger margins), evolving pricing structures to structured arrangements, expanding prepared foods platform. - Key developments: specialty eggs and prepared foods increasing in sales contribution; egg market impacted by High Path AI but supply improved; acquired shell egg, egg products, and prepared foods assets of Creighton Brothers and Crystal Lake to expand geographic scale and support internal sourcing. - Prepared foods sales up YOY but Q3 was trough due to network optimization, with margin pressure volume-driven but expecting recovery in Q4 with capacity coming online.

In the third quarter of fiscal 2026, specialty eggs accounted for 50.5% of total shell egg sales (up from 24.4% in comparable period of fiscal 2025) and 9.5% of net sales (up from 0.8%). Prepared foods accounted for 9.5% of net sales (up from 0.8%). For the first three quarters of fiscal 2026, specialty eggs were 42.7% of total shell egg sales (up from 29.2%) and 9.3% of net sales (up from 1%). Net sales in Q3 2026 were $667 million vs $1.4 billion prior year. Conventional egg sales were $283.2 million vs $1 billion, down 72.1%. Specialty egg sales were $289.1 million vs $328.9 million, down 12.1%. Prepared food sales were $63.6 million vs $11.8 million, up 441.2% YOY but down 11.2% QOQ.

• Prepared foods capacity expected to increase over 30% in next 18 - 24 months. - Margin recovery for prepared foods expected to start in Q4 2026 and trend back to baseline through fiscal 2027 and 2028 as scale and network efficiencies are realized. - Repurchase program permits purchase of up to $500 million, with $350.8 million remaining available. - Will pay cash dividend of approximately $0.36 per share in Q3 2026.

• Impact of High Path AI still present though magnitude lower, which could affect supply and pricing. - Geopolitical factors affecting grain and fuel costs which impact feed costs. - Network optimization and expansion activities in prepared foods could cause temporary margin pressure and product mix issues in the near term.

Q: Regarding specialty pricing, asked if Q4 specialty price would be similar to Q3.

A: Specialty pricing mostly stable, with some component tied to cage - free California market varying, but expected to stay pretty consistent.

Q: Follow - up on prepared foods margin, asked if not expecting full recovery until 2028 and about baseline.

A: Q3 was trough due to network expansion, margin recovery to start in Q4 2026, with full recovery towards end of 2027 and into 2028, baseline related to margin after scale and network efficiencies.

Q: On conventional egg pricing, asked about cost of production and capital allocation for liquids.

A: Hybrid pricing provides more stable profit, capital allocation still pursues selective accretive M&A where returns compelling, including in liquids area.

Q: On demand, asked about branded portfolios and feed costs.

A: Retail egg volumes up, branded portfolios growing, feed costs managed through grain warehousing, basis locks or hedging strategies.

Q: On supply in specialty egg category and organic growth investments trade - offs.

A: Specialty egg supply growth supported by projects, capital allocated to opportunities enhancing earnings quality, portfolio resilience, and long - term shareholder value with consideration of various areas including productivity enhancements and capacity addition