1
UNITEDSTATESSECURITIESAND EXCHANGECOMMISSION
Washington,DC20549
FORM
10-K
☑
ANNUALREPORTPURSUANTTO SECTION13 OR 15(d)OF THE SECURITIESEXCHANGEACT OF 1934
For The FiscalYearEnded
May 30, 2026
☐
TRANSITIONREPORTPURSUANT TOSECTION13 OR15(d) OF THE SECURITIESEXCHANGEACT OF1934
For thetransitionperiodfrom____________to ____________
Commissionfile number:
001-38695
CAL-MAINE FOODS, INC.
(Exact name of registrant as specified in its charter)
Delaware
64-0500378
(Stateor other Jurisdictionof Incorporationor Organization)
(I.R.S.EmployerIdentificationNo.)
1052 Highland Colony Pkwy
,
Suite 200
,
Ridgeland
,
Mississippi
39157
(Address of principal executive offices) (Zip Code)
(
601
)
948-6813
(Registrant’s telephone number, includingarea code)
Securities registered pursuant to Section 12 (b) of the Act:
Title of each class:
Trading Symbol(s)
Name of each exchange on which registered:
Common Stock, $0.01 par value per share
CALM
The Nasdaq Global Select Market
Securities registered pursuant to Section 12 (g) of the Act:NONE
Indicate by check mark if the registrant is a well-known seasoned issuer as defined in Rule 405 of the Securities Act.
Yes
☑
No
☐
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.Yes
☐
No
☑
Indicate by check mark whether theregistrant (1) has filed all reports required to be filed bySection 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12months (or for such shorter period that theregistrant was required to file such reports), and (2)has been subject
to such filing requirements for the past 90 days.
Yes
☑
No
☐
Indicate by check mark whetherthe registrant has submitted electronicallyevery Interactive Data File required tobe submitted pursuant to Rule
405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to
submitsuch files).
Yes
☑
No
☐
Indicatebycheck markwhethertheregistrantis alargeaccelerated filer,anaccelerated filer,anon-acceleratedfiler,a smallerreporting
company,or an emerginggrowth company.See the definitionsof “largeaccelerated filer,”“accelerated filer,”“smaller reportingcompany”
and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer
☑
Acceleratedfiler
☐
Non-acceleratedfiler
☐
Smaller reporting company
☐
Emerging growth company
☐
If anemerginggrowth company,indicate bycheck markif theregistranthas electednot touse theextendedtransition periodfor
complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act
☐
Indicate bycheck markwhether theregistrant has fileda report onand attestationto its management'sassessment ofthe effectiveness ofits
internal controlover financial reporting underSection 404(b)of the Sarbanes-OxleyAct (15 U.S.C.7262(b)) by theregistered public accounting
firmthat prepared or issued its audit report.
☑
If securities areregistered pursuantto Section 12(b) ofthe Act, indicateby check markwhether the financialstatements of theregistrant included
in the filing reflect the correction of an error to previously issued financial statements.
☐
Indicatebyacheckmarkwhetheranyofthoseerrorcorrectionsarerestatementsthatrequiredarecoveryanalysisofincentive-based
compensation received by any of the registrant’s executive officers during the relevantrecovery period pursuant to §240.10D-1(b).
☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).Yes
☐
No
☑
The aggregate market value, asreported by The Nasdaq Global Select Market, of theregistrant’s Common Stock, $0.01 par value,held by non-
affiliates at November 28, 2025,which was the date ofthe last business day of the registrant’smost recently completed second fiscal quarter,
was $
3,825,418,582
.
As of July 22, 2026,
46,917,080
shares of the registrant’s Common Stock, $0.01 par value, were outstanding.
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DOCUMENTS INCORPORATEDBY REFERENCE
The information called for by Part III of thisAnnual Report on Form 10-K is incorporated herein by referencefrom the registrant’sDefinitive
Proxy Statement forits 2026 annual meeting ofstockholders which willbe filed pursuant to Regulation14A not laterthan 120 days afterthe
end of the fiscal year covered by this Annual Report on Form 10-K.
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TABLEOF CONTENTS
Item
Page
Number
1.
1A.
1B.
1C.
2.
3.
4.
5.
6.
7.
7A.
8.
9.
9A.
9B.
9C.
10.
11.
12.
13.
14.
15.
16.
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PARTI.
FORWARD-LOOKINGSTATEMENTS
This reportcontainsnumerousforward-looking statementswithin the meaningof Section 27Aof the SecuritiesAct of 1933(the
“Securities Act”) andSection 21E of the Securities ExchangeAct of 1934 (the “Exchange Act”) relating toour business, including
potential futuresupply of anddemandfor our products, potential futurecorn andsoybeanprice trends, potential futureimpact on
our businessof highlypathogenicavianinfluenza(“HPAI”),estimatedfuture productiondata,expectedconstructionschedules,
projectedconstructioncosts,potentialfutureimpactonourbusinessofinflationandchanginginterestrates,potentialfuture
impacton our businessof newlegislation,rules orpolicies, potentialoutcomesof legalproceedings,includingloss contingency
accrualsandfactorsthatmayresult inchangesin theamountsrecorded, otherprojectedoperatingdata,includinganticipated
resultsof operationsandfinancial condition,andpotentialfuturecashreturns to stockholdersincluding thetimingandam
ount
of any repurchasesunder our share repurchaseprogram. Such forward-looking statementsare identified by the use of words such
as“believes,”“intends,”“expects,”“hopes,”“may,”“should,”“plans,”“projected,”“contemplates,”“anticipates,”or similar
words.Actual outcomesor resultscould differmateriallyfrom thoseprojectedin theforward-looking statements.The forward-
lookingstatementsarebasedonmanagement’scurrentintent,belief,expectations,estimates,andprojectionsregardingthe
Companyanditsindustry.Thesestatementsarenotguaranteesoffutureperformanceandinvolverisks,uncertainties,
assumptions,andother factorsthatare difficulttopredictandmaybe beyondour control.Thefactorsthatcould causeactual
resultsto differmateriallyfrom thoseprojectedinthe forward-looking statementsinclude, amongothers,(i) therisk factorsset
forthin Item1A. RiskFactorsandelsewhere inthis reportas wellas thoseincludedin otherreportswefilefromtime totime
with the Securitiesand ExchangeCommission (the“SEC”) (includingour QuarterlyReports onForm 10-Q and CurrentReports
on Form 8-K), (ii) changesin wholesale shell egg marketprices, (iii) changes in the demandfor shell eggs and our prepared foods
offerings,(iv) increasesin feedcostsfor ourshell eggoperationsas wellas increasesin inputcosts forprepared foods,(v)our
abilitytopredictandmeetdemandfor cage-free andotherspecialtyeggs, (vi) therisks andhazardsinherentin shell egg, egg
productsandpreparedfoodsoperations(including,as applicable,disease,pests,weatherconditions,andpotentialforproduct
recall), includingbut notlimitedto thecurrentoutbreakof HPAIaffectingpoultry inthe U.S.,Canadaand other countriesthat
was firstdetectedin commercial flocksin the U.S. inFebruary 2022and thatimpactedour flocks in the third andfourth quarters
of fiscal2024 andagain in March2026,(vii) risks, changes, or obligationsthat could resultfrom our recentor futureacquisition
of new flocksor businesses,such asour acquisitionof Echo LakeFoodscompletedJune 2, 2025,and risksor changesthat may
cause conditionsto completing a pending acquisitionnot to be met, (viii) our ability to successfullyintegrate and managerecently
acquired businesses like Echo LakeFoods and realize the expectedbenefits of such acquisitions, including synergies, cost savings,
reductioninearningsvolatility,marginexpansion,financialreturns,expandedcustomerrelationships,orsalesorgrowth
opportunities,(ix)ourabilitytoproduce,supplyanddistributeshelleggsandpreparedfoodsefficientlyandreliably,(x)our
abilitytocompeteeffectivelywithexistingcompetitorsandnewmarketentrants,retainexistingcustomers,acquirenew
customersand growour productmix includingour preparedfoodsproduct offerings,(xi) theimpactsof government,customer
andconsumerreactionstohighmarketpricesforeggs,including,withoutlimitation,potentialneworexpandedgovernment
regulations,(xii)risksrelatingtopotentialchangesininflation,interestratesandtradeandtariffpolicies,(xiii)thelossor
expiration ofany registeredtrademarksor other intellectual propertythatwe use in our business, (xiv) adverseresults in pending
litigation andother legal matters,and (xv) global instability,including asa result of geopoliticalconflicts andother uncertainties.
Theactualtiming,numberandvalueofsharesrepurchasedunderoursharerepurchaseprogramwillbedeterminedby
managementinitsdiscretion andwilldepend on a numberof factors, including but not limited to,the marketprice of ourCommon
Stock andgeneral marketand economicconditions.The sharerepurchaseprogram maybe suspended,modifiedor discontinued
at anytime without prior notice.Readers are cautionednot to place unduereliance on forward-looking statementsbecause, while
webelieve theassumptionson whichthe forward-lookingstatementsare basedare reasonable,there canbeno assurancethat
these forward-looking statementswill proveto beaccurate.Further,forward-looking statementsincluded hereinare madeonly
as of therespectivedates thereof,or if nodate is stated,as ofthe date hereof.Exceptas otherwiserequiredby law,we disclaim
any intent or obligationto updatepublicly these forward-looking statements,whether becauseof new information,future events,
or otherwise.
ITEM 1.BUSINESS
Overview
Weare thelargestegg companyin the UnitedStates(“U.S.”)and aleadingplayer inthe egg-basedfoodindustry.Westrive to
betheleadingconsumer-drivenproviderofnutritious,affordable,andsustainableeggsandegg-basedfoodsthatfittoday's
lifestyles.Ourvisionis toensurethathealthy,affordableeggs andegg-basedfoodchoicesare accessibleto everyhousehold,
everyday.Wesell mostof ourproductsthroughout
much
of theU.S. andaim tomaintainefficient,state-of-the-artoperations
locatedclose to our customers.We were foundedin 1957andare headquarteredin Ridgeland,Mississippi.
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TheCompany’sshelleggportfoliospansthefulleggvalueladder—fromconventionaltospecialty,includingcage-free,
nutritionallyenhanced,organic,brown,pasture-raised,andfree-rangeeggs—servingbothretailandfoodservicecustomers
nationwide.Cal-MaineFoodsalsoparticipatesinthegrowingpreparedfoodssector,withofferingssuchaspre-cookedegg
patties,omelets,foldedandscrambledeggformats,hard-cookedeggs,pancakes,waffles,andspecialtywraps.Ourbranded
portfolio includesEggland’sBest®,Land O’Lakes®,FarmhouseEggs®,4Grain®,Sunups®,Van’s®,MeadowCreekFoods®,
andCrepini®.
Whenwe use“we,”“us,” “our,”“Cal-Maine Foods,”or the“Company”in this report, wemeanCal-Maine Foods,Inc. andits
consolidatedsubsidiaries, unlessotherwise indicatedor the contextotherwise requires.
The Company’sfiscal year-end ison the Saturdayclosest to May 31. Our fiscal year 2026 endedMay 30, 2026, andthe first three
fiscal quartersof fiscal 2026 endedAugust 30, 2025, November29, 2025, andFebruary 28, 2026. All references hereinto a fiscal
yearmeansour fiscal yearandall references toa yearmeana calendaryear.
Operatingand ReportableSegments
Wepreviously managedour business as one operatingandone reportable segment.Effectivein the fourthquarter of fiscal2026,
werevised ourinternal reportingtochangethe mannerin whichwe manageour business,which reflectsa focuson managing
operationsbasedonourproductcategoriesratherthanonaconsolidatedbasis.As aresult,weidentifiedthreereportable
segments: ConventionalShell Eggs,SpecialtyShell Eggs, andPrepared Foods.Our remainingoperations,which include co-pack
shell eggs, egg products,hard-cooked eggs and other businessactivities, are not reportablesegments, as definedby the applicable
accountingstandard.
ConventionalShell Eggs
TheConventionalShellEggssegmentconsistsprimarilyoftheproduction,grading,packaging,marketingand
distributionof shell eggssold as conventionalshell eggs, which includes ourbrands
Sunups®
and
Sunny Meadow®.
SpecialtyShell Eggs
The SpecialtyShell Eggssegmentconsistsprimarilyof the production,grading,packaging, marketingand distribution
of shell eggs sold as cage-free, nutritionallyenhanced,organic, brown, pasture-raised and free-rangeeggs. This segment
includesour brands
FarmhouseEggs
® and
4Grain®
as well asbrandedproducts fromourcooperativemembershipin
Eggland’sBest,Inc. which includes
Egg-Land’sBest®
and
Land O’ Lakes®
brandedeggs
.
PreparedFoods
ThePreparedFoodssegmentconsistsprimarilyof theproduction,packaging,marketinganddistributionofprepared
foods productofferingssuch aspre-cookedegg patties,omelets,folded andscrambledegg formats,pancakes,waffles
andspecialtywraps. This segmentincludesour brands
Van’s®
and
Crepini®.
Allpriorfiscalyearperiodshavebeenrecasttoreflectthenew reportablesegments.Foradditionaldiscussionregardingthe
changetoournew reportablesegments,see
inPart II.Item8. NotestoConsolidatedFinancial
Statements.
GrowthStrategy
Cal-Maine Foods’long-termgrowthstrategyis focusedon buildinga diversifiedegg-basedfoodplatformthatextends beyond
conventionalshell eggs and enhancesthe Company’searnings profile andresilience across marketcycles. The Companyintends
to leverageits marketposition, verticallyintegrated operations,strong balancesheet, and longstandingcustomer relationshipsto
pursue opportunitiesthatdrive sustainablegrowth, expandmargins, anddiversify its revenuestreams.
The Company’sgrowth initiatives include increasingthe proportion of specialty shelleggs in its sales mix, expandingits prepared
foodsandeggproductsbusinesses,strengtheningandextendingitsportfolioofbrandedofferings,andpursuingstrategic
acquisitionsandorganicinvestmentsthatcomplementits existingcapabilities.Withinitsconventionalshell eggbusiness,the
Companyemploysabalancedpricingstrategythatcombinesmarket-basedandstructuredpricingarrangementsintendedto
participateinfavorablepricing environments while enhancingearnings visibility andcash flow stability over time.The Company
alsocontinuestoinvestinbiosecurity,productivityinitiatives,andverticalintegrationtoreinforcecostleadershipandsupply
reliabilityandseekstoexpanditsgeographicpresenceandcustomerpenetrationthroughdisciplinedcapitalallocationand
investmentsthatenhanceits production,distribution, andcommercialcapabilities.
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TheCompanycurrentlyhasmultipleexpansioninitiativesunderwayforitsPreparedFoodssegment.AtEchoLakesFoods
facilities, the Companyhas a network optimizationand capacityexpansion projectunderway,which isexpectedto add 17 million
poundsof annualscrambledegg productionbymid-to-late-fiscal2027,aswellas ahigh-speedpancakeline project,which is
expectedtoaddanadditional12millionpoundsofannualproductionthroughearly-to-mid-fiscal2027.Inaddition,the
Company’sjoint venture,CrepiniFoods,is investingin newequipmentand lineinstallationsthat isexpectedto add18 million
pounds of additionalproductioncapacity gradually over the next 12 to 18 months with expected completionby early-to-mid fiscal
2028. Intotal, theseplannedinvestmentsare expectedto grow Cal-Maine’sprepared foodsproductioncapacityby more than 30
percentfrommid-2027through 2028.
Managementbelieves thatthe combinationof conventionalandspecialtyshell eggs, preparedfoods,egg products,and branded
offerings createsa more balancedand diversified business model thatis better positioned to serve evolvingconsumer preferences
andcustomerneeds.Throughthese initiatives,theCompanyseeks to increaseits normalizedearningspowerandcreatelong-
term valuefor its customersandshareholders.
Acquisitions
Throughoutourhistory,wehaveacquiredotherbusinessesinourindustry.Since1989,wehaveacquiredandintegrated28
businesses.Within thelast two fiscalyears, wehavemadethe following significant acquisitions.
EffectiveMay 12,2026, we acquiredcertainassets ofthe Van’sFoods(“Van’s”) businessof SaraLee FrozenBakery,LLCfor
approximately$24.8 million.The assets acquiredare expectedto help support ourstrategyto diversify ourbusiness model,grow
in preparedfoodsbusiness-to-retail, anddeliver greater valueacross thesupply chain.
EffectiveMarch 2, 2026, we acquired the shell egg, egg products, andprepared foodsassets of Creighton Brothers LLC, including
Crystal Lake LLC (“Creighton”),for approximately$129.3 million. The acquiredassets include commercialshell egg production
and grading with capacityof approximately3.2 million layers, including 500 thousandcage-free layers, and 865 thousandpullets,
a feedmill,and1,007acres ofland, aswellasanegg productsandhard-cookedegg processingfacilitylocatednearWarsaw,
Indiana.The transactionexpands the geographic scale of our shell egg platformwhile also adding nearbyliquid egg capacitythat
we believewill strengthenour integratedvaluechain.
EffectiveOctober10,2025,weacquiredcertainassetsofCleanEgg,LLC(“CleanEgg”)basedinLangwood,Texas,for
approximately$23.7 million.The assets acquiredincluded 677thousandbrown cage-free andfree-range layersand pullets,and
other inventory,machineryandequipmentrelatedto its contractproductionandegg processing business.
EffectiveJune 2, 2025,we acquiredEcho LakeFoods, LLC andcertainrelated companies(collectively“Echo Lake Foods”)for
approximately$289.5million.EchoLakeFoodsisbasedinBurlington,Wisconsinandproduces,packages,marketsand
distributesprepared foods,includingpre-cookedegg patties,omelets,folded andscrambledegg formats,pancakesand waffles.
The acquisitionhas expandedour prepared foodsproduct line and customerbase. Our previouslyannouncedprojects to increase
efficiencyandexpandproductioncapacityare ongoing andexpectedto continuethroughoutmid to latefiscal 2027.
Duringthe thirdquarterof fiscal2025,weacquiredcertainassetsof Deal-RiteFoods,Inc.andcertainof itsaffiliates(“Deal-
Rite”). Theassets acquiredincluded twofeed mills,storage facilities,usablegrain, vehicles,relatedequipmentand a retail feed
salesbusinesslocatedin NorthCarolina.The acquiredassetswillproduceanddeliverfeedto ournearbyshell eggproduction
operations.
During the secondquarter of fiscal 2025, wecompleteda strategic investmentwith Crepini LLC, establishing a new egg products
and preparedfoods venture.Crepini LLC, foundedin 2007, grew itsbrand throughoutthe U.S. andMexico featuringegg wraps,
proteinpancakes,crepes, andwrap-ups, whicharesold onlineandin over 3,500retail stores.Thecombinedentity,locatedin
HopewellJunction,New York,operatesas CrepiniFoods LLC(“Crepini”).WecapitalizedCrepiniwithapproximately$6.75
million incash to purchaseadditionalequipmentand other assetsand fundworking capitalin exchangefor a 51%interest inthe
new venture.Crepini LLC contributedits existing assetsandbusiness in exchangefor a49% interestin the new venture.
Duringthesecondquarteroffiscal2025,weacquiredtheremainingownershipinterestsinMeadowCreekFoods,LLC
(“MeadowCreek”)andit becamea wholly-ownedsubsidiaryof theCompany.Our initialinvestmentin MeadowCreekwasin
fiscal 2022.MeadowCreekbegan operationsduring thefourth quarterof fiscal2023 witha focuson beinga leadingprovider of
hard-cookedeggs.
Duringthefirstquarterof fiscal2025,weacquiredsubstantiallyall thecommercialshelleggproduction,processingandegg
products breakingassets ofISE America, Inc.and certainof its affiliates(“ISE”). Theassetsacquired includedcommercialshel
l
eggproductionandprocessingfacilitieswithacapacityatthetimeofacquisitionofapproximately4.7million layinghens,
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including 1.0 millioncage-free, 1.2 millionpullets, feed mills, approximately4,000 acres of land, inventories and an egg products
breakingfacility.Theacquiredassetsalsoincludeanextensivecustomerdistributionnetworkacross theNortheastandMid-
Atlantic states,and productionoperationsin Maryland,New Jersey,Delaware andSouth Carolina. Theseproductionassetswere
our firstin Maryland,New Jerseyand Delaware.Thisacquisitionprovidedus withan opportunityto enhanceour marketreach
in theNortheastandMid-Atlantic states.
For additionaldiscussion of our acquisitionsduring the lasttwo fiscal years,see
in PartII. Item 8. Notes to
ConsolidatedFinancialStatements.
Egg IndustryBackground
According to the U.S. Departmentof Agriculture (“USDA”) AgriculturalMarketing Service,in 2025approximately69% of table
eggs produced in theU.S. were sold as shelleggs, with 55%of such shell eggs sold throughfood-
at
-home outlets such as grocery
and conveniencestores, 12% soldto food-away-from home channels such as restaurantsand 2% exported.The USDA estimated
thatin 2025approximately31%ofeggs producedin theU.S. were soldasegg products(shell eggs brokenandsold inliquid,
frozen, or driedform).
Givenhistoricalconsumptiontrends,webelievethatgeneraldemandfor eggsin theU.S.increasesbasicallyin linewiththe
overallU.S.populationgrowth;however,specificeventscanimpacteggsupplyandconsumptioninaparticularperiod,as
experiencedwith the2015highlypathogenicavianinfluenza(“HPAI”)outbreak,the COVID-19pandemic(particularlyduring
2020),andthemostrecentHPAIoutbreaksthatstartedinearly2022.Forfiscal2026,shellegghouseholdpenetrationwas
approximately97%. According to the USDA’sEconomic ResearchService,estimatedannual per capitaconsumptionintheU.S.
between2021 and2025varied,rangingfrom260to286 eggswhichwasdirectlyimpactedby availablesupply.TheUSDA
calculatesper capitaconsumption bydividing total shell egg disappearancein the U.S. by the U.S. population.
The mostsignificantshift in demandover thepast decadehas beenamongspecialtyshell eggs,particularlycage-free eggs.For
additionalinformation,see “SpecialtyShell Eggs” below.
HPAI
Ourindustryhasbeen greatlyimpactedby severaloutbreaksof HPAIin recentyears.Following theHPAIoutbreaksin 2015,
there were noreportedsignificant outbreaksof HPAIin the commercialtableegg layer flocksuntil Februarythrough December
2022.Thereafter,therewere no HPAIcases affectingcommerciallayersuntil November2023.Since 2023,outbreaksof HPAI
have continuedto occur inU.S. poultry flocks.In 2024 and2025, 40.2 million and 45.2 million commercial layer hensand pullets
weredepopulateddue toHPAI,respectively.Todatein 2026,through July20,2026,19.2million layerhens andpullets have
been depopulateddue toHPAI.
On March14,2026,we experiencedanHPAIoutbreakwithin our pulletfacilityin Maryland,resulting inthedepopulationof
approximately352,000pullets. Subsequentto fiscal 2026,operationshavefully resumed.
HPAIis currently widespreadin the wild birdpopulationworldwide.Further,accordingto the U.S. Centersfor DiseaseContro
l
and Prevention(“CDC”),as ofJuly 16,2026, therehave beenoutbreaksof HPAIin 1,166 herdsof dairycows in20 states,and
71 humancases in the U.S., almost entirelyamongpoultry and dairyworkers, sincethe latest outbreakbegan. Two ofthe human
cases resulted in severe illnessafter the patientwas exposed to sick and dead birds in backyardflocks. Both patients were reported
to haveunderlying healthconditions anddied in 2025.There havebeen no reportedcases of person-to-personspread.According
to the CDC, the humanhealth risk to the U.S. publicfrom the HPAIvirus is consideredto be low.We remaindedicatedto robust
biosecurityprogramsacrossourlocationsandhaveinvestedmorethan$92millioninbiosecuritytechnology,equipment,
supplies,procedures,andtraining acrossourlocationssince themajorHPAIoutbreakin 2015.However,nofarmis immune
fromHPAI.TheextentofpossiblefutureoutbreaksamongU.S.commercialegglayerflocks,withheightenedriskduring
migration seasons,cannotbe predicted. Accordingto the USDA, HPAI cannotbe transmittedthrough safely handled and properly
cooked eggs.There is no knownrisk related to HPAIassociatedwith eggs that are currentlyin the marketand no eggs havebeen
recalledrelating toHPAI.For additionalinformation,refer to
.
Prices for Shell Eggs
Wholesaleshell eggsales pricesare acriticalcomponentof revenuefor theCompany.Wholesaleshell egg pricesare volatile,
cyclical,and impactedby a numberof factors,includingconsumer demand,seasonalfluctuations,the numberand productivity
of layinghens intheU.S. andoutbreaksof agriculturaldiseasessuch asHPAI.Webelievethe majorityof conventionalshell
eggs sold in the U.S. in the retail and foodservicechannels are sold at prices that takeinto account, in varying ways, independently
8
quotedandcertified wholesale marketprices, such as thosepublished byUrner Barry Publications,Inc. (“UB”) or the USDA for
shell eggs;however,grain-basedor variationsof costplus arrangementsare alsocommonlyutilized.
Wholesale pricesfor cage-free eggs are also quotedby independentsources such as UBand the USDA. Thereis no independently
quotedwholesale marketprice for other specialtyshell eggs such as nutritionallyenhanced,organic, pasture-raise and free-range
eggs.Specialtyshell eggsare typicallysoldatprices andterms negotiateddirectly withcustomersandin thecaseof cage-free
eggs, canbe sold at pricesthat takeinto accountone of the independentlyquotedmarkets.Historically, prices for specialtyshell
eggs havegenerally beenhigher due to customerandconsumerwillingnessto paymore forspecialtyeggs.
Theweekly averageprice forthesoutheastregion for largewhiteconventionalshell eggs asquotedby UBis shownbelowby
fiscal quarterfor the past threefiscalyears along withthe average pricefor thepast fivefiscalyears.The actualshell egg prices
that we realizeon anygiven transactionmaynot necessarily equalquotedmarketprices because of theindividualizedterms that
wenegotiatewithindividualcustomers,whichtakeintoaccountmanyfactors.Asfurtherdiscussedin
, egg prices infiscal 2024through fiscal2026were significantly
impactedby HPAI.
Our pricing for shell eggs is negotiatedwith our customers on individualterms. Wesell our shell eggs at prices basedon formulas
that takeinto account, in varying ways, one of the independentlyquotedregional wholesale marketprices for shell eggs, our costs
of production,such as grain-based,or hybridmodelswhich includeelementsof cost ofproductionand wholesalemarketprices.
Almostallofourconventionalshelleggsarepricedandsoldundermarket-basedpricing frameworksorthehybridmodels
described above,split almost evenly between such frameworks.The majorityof our specialty shell eggs arepriced and sold under
frameworksthat are basedon cost of production, althoughwe do havesome customersthat prefer market-based pricing forcage-
freeeggs. Asa result,specialtyshell eggpricestypically donot fluctuateas muchas conventionalshell egg prices.Wedo not
sell eggsdirectly toconsumersor set theprices at which eggsare sold toconsumers.
Dependingon marketconditions,input costs andindividualizedcontractterms, theprice we receive per dozeneggs in any given
transactionmaybe morethanor less thanour productioncost per dozen.
9
Feed Costsfor ShellEgg Production
Feedis a primarycost componentin theproductionof shelleggs.Weroutinelyfill ourfeedstorage binsduring harvestseason
when pricesfor feed ingredients,primarilycornand to alesser extentsoybeanmeal, are generallylower.Wecurrently havethe
capacityto store 242thousandtons of cornandsoybeanmeal, andwe replenish these storesas neededthroughoutthe year.As
the quality andcompositionof feed isa criticalfactorinthe nutritional value of shell eggs and healthof our chickens, we formulate
and producethevast majorityof our own feed at our feedmills locatednear our productionplants. Our annualfeed requirements
for fiscal 2026were 2.2 milliontons offinished feed,of which we manufactured2.1 million tons.
To ensurecontinuedavailabilityof feed ingredients,we mayenter into contractsfor future purchasesof corn andsoybeanmeal,
andas partof thesecontracts,we maylock-in thebasis portionof ourgrain purchasesseveralmonthsin advance.Basis is the
differencebetweenthelocalcashpriceforgrainandthe applicablefuturesprice.Thedifferencecanbedue totransportation
costs, storagecosts, supplyand demand,local conditions and other factors.A basis contractis a common transactioninthe grain
marketthatallowsustolock-inabasislevelforaspecificdeliveryperiodandwaittosetthefuturespriceatalaterdate.
Furthermore,due to themore limitedsupply fororganic ingredients,we maycommit to purchaseorganic ingredientsin advance
to help ensuresupply.Ordinarily,we donot enterinto long-termcontractsbeyonda yearto purchase cornand soybeanmeal or
hedge againstincreases in thepricesof cornandsoybeanmeal.
Our primaryfeed ingredients,corn andsoybeanmeal, are commoditiesthat are subjectto volatileprice changesdue toweather,
varioussupplyanddemandfactors, transportationandstorage costs,speculators,andagricultural,energyandtradepolicies in
the U.S.and internationally,and global instabilitythat coulddisrupt the supplychain.Wepurchasethe vast majorityof our corn
and soybeanmealfromU.S sources butmaybe forcedto purchaseinternationallywhen U.S. suppliesare not readilyavailable.
FeedgrainsarecurrentlyavailablefromanadequatenumberofsourcesintheU.S. Asapointofreference,amulti-year
comparisonof theaverageof dailyclosingprices perChicagoBoardof Tradefor eachquarterin our fiscalyears 2022-2026 is
shown belowfor corn andsoybeanmeal:
10
Shell EggProduction
Our percentageof dozensproducedto soldwas 92.1%of ourtotal shelleggs sold infiscal 2026.Wesupplementour production
through purchasesof eggs from otherswhen needed.The quantityof eggs purchased will vary basedon manyfactors such as our
own productioncapabilitiesand currentmarketconditions.In fiscal 2026, 90.0%of ourproductioncamefrom Company-owned
facilities,and10.0%camefromcontractproducers.Themajorityofourcontractproductioniswithfamily-ownedfarmsfor
organic,pasture-raised and free-rangeeggs. Undera typicalarrangementwith a contractproducer, weownthe flock,furnish all
feedandcritical supplies,ownthe shelleggs producedandassumemarketrisks. The contractproducersown andoperatetheir
facilities andare paida feebasedon productionwith incentives for performance.
The commercialproductionof shell eggsrequiresa sourceof babychicks for layingflock replacement.Wesupply themajority
ofourchicksfromourbreederfarmsandhatchtheminourhatcheriesina computer-controlledenvironmentandobtainthe
balancefrom commercialsources.The chicksare grownin our ownpullet farmsand areplacedinto thelaying flockonce they
reachmaturity.
After eggs are produced, theyare cleaned, graded andpackaged. Substantially all our farms havemodern “in-line”facilities which
mechanicallygather,clean,gradeandpackagetheeggsatthelocationwheretheyarelaid.Thein-linefacilitiesgenerate
significantefficienciesandcost savingscomparedtothecostofeggs producedfromnon-in-line facilities, whicharefacilities
that processtheireggs thathave beenlaid atone locationand transportedto a separateprocessingfacility.Thein-line facilities
also producea higherpercentageof USDA GradeA eggs, whichgenerallysell at higherprices, comparedto eggs thatare either
not graded or lower grade.Eggs produced on farmsowned by contractproducers are brought to our processing plants to be graded
andpackaged.WemaintainaSafeQualityFood(“SQF”)ManagementProgramwhichisoverseenbyourFoodSafety
Departmentandsenior managementteam.As ofMay30,2026,everyCompany-ownedprocessing plantwasSQF certified.
Becauseshell eggs are perishable,we donot maintainlarge egg inventories.Our egg inventoryaveragedsix days of salesduring
fiscal2026.Webelieveourconstantfocusonproductionefficienciesandautomationthroughoutourverticallyintegrated
operationsenableus to be alow-cost supplier in our markets.
Weareproudtohavecreated,implementedandmaintainedwhatwebelieveisaleadingpoultryAnimalWelfareProgram
(“AWP”).WehavealignedourAWPwithregulatory,veterinaryandcertainthird-partycertifying bodies’guidanceto govern
the welfareof animalsin our directcareand ourcontractfarmers’ care.Wecontinuallyreviewour AWPto monitorand evolve
standardsthat guide how we hatchchicks, rear pullets andnurture breeder andlayer hens. At each stage ofour animals’lives, we
are dedicatedto providing welfareconditionsaligned to ourcommitmentto the principles ofthe internationallyrecognized
Five
Freedomsof AnimalWelfare
.
Wedo notuseartificialhormonesin theproductionofoureggs.Hormoneuse inthe poultryandegg productionindustryhas
beeneffectivelybannedintheU.S.sincethe1950s.Wehaveanextensivewrittenprotocolthatallowstheuseofmedically
importantantibioticsonly when animalhealth isat risk,consistentwith guidancefrom theU. S.Food andDrug Administration
(“FDA”)and the Guidancefor JudiciousTherapeuticUse ofAntimicrobialsin Poultry,developedby the AmericanAssociation
ofAvianPathologists.Whenantibioticsaremedicallynecessary,alicensedveterinarydoctorwillapproveandadminister
approveddoses fora restrictedperiod. We donot useantibioticsfor growth promotionor performanceenhancement.
Specialty ShellEggs
Weare one of the largest producersand marketersof specialtyshell eggs in theU.S.,which continues tobe a significantsegment
ofthemarket.Specialtyshelleggsareintendedtomeetthe demandsof consumerssensitivetoenvironmental,healthand/or
animalwelfare issues and,as applicable,to complywith staterequirementsfor cage-free eggs.
TenstatesintheU.S.havepassedlegislationorregulationsmandatingminimumspaceorcage-freerequirementsforegg
productionor mandatedthe sale of only cage-free eggsand egg products in their states, with implementationof these laws ranging
fromJanuary2022to January2030,representingapproximately27% ofthe totalU.S.populationaccordingtothe2020U.S.
Census.California,Massachusetts,Colorado,Michigan,Oregon,Washington,andNevada,whichcollectivelyrepresent
approximately23% ofthetotalU.S.population,havecage-free legislation in effect.
A significantnumber ofour customershave announcedgoals to either exclusivelyoffercage-free eggsor significantlyincrease
the volume of cage-free egg sales in the future, subject in most cases to availability of supply,affordabilityand consumerdemand,
amongothercontingencies.Ourcustomers’salesinitiativesandproductmixareconstantlychanging,makingitdifficultto
accuratelypredict customer requirementsfor cage-free eggs.We arefocused on adjustingour cage-free production capacitywith
the goal of meeting the futureneeds of our customers in light of changingstate requirementsand our customers’ goals. As always,
we striveto offera productmix thataligns withcurrentand anticipatedcustomer purchasedecisions. Weare engagingwithour
11
customers tohelp them meettheir announcedgoals and needs. We have investedsignificantcapital in recent years toacquire and
construct cage-free facilities, andweexpect our focusfor future expansionto continue to include cage-free facilities. Our volume
of cage-free egg sales has continuedto increase and accountfor a largershare of our product mix. At thesame time, we understand
theimportanceofourcontinuedabilitytoproducemoreaffordableconventional shelleggstoprovideourcustomerswith a
varietyof egg choicesandto addresshunger in our communities.
BrandedEggs
Weare a member ofthe Eggland’sBest, Inc. cooperative(“EB”) andproduce, market,distribute andsell
Egg-Land’sBest®
and
Land O’Lakes®
brandedeggs under alicense fromEB atour facilitiesunder EBguidelines.EB hens arefed a proprietarydiet
andofferingsincludenutritionallyenhanced,cage-free, organic,pasture-raised andfree-rangeeggs.
LandO’ Lakes®
branded
eggs areproducedby hensthatare feda whole-grain vegetariandiet andinclude brown, organicandcage-free eggs.
In 2025,EB wasthethird best-selling dairybrandin theU.S.Byvolume,the toptwo best-sellingbrandedspecialtyshell egg
SKUsin 2025wereEB brandedeggs and sixout of 10best-sellingSKUs wereEB brandedeggs. In2025, oursales(including
sales from affiliates)representedapproximately56% of EB brandedeggs and 43% of
Land O’ Lakes®
brandedeggs nationwide.
Our
FarmhouseEggs
® branded eggs are producedat our facilities byhens that are providedwith a vegetariandiet. Our offerings
of
FarmhouseEggs
® include cage-free, organicand pastureraised eggs. Wemarketorganic, vegetarianand omega-3 eggsunder
our
4Grain®
brand,which consistsof conventionalandcage-free eggs.Our
Sunups®
and
Sunny Meadow®
brandsare sold as
conventionalshell eggs.
Wealso produce,marketanddistribute privatelabel specialtyandconventionalshell eggsto severalcustomers.
PreparedFoods
Our preparedfoods offerings includepre-cooked eggpatties,omelets, foldedand scrambledegg formats,pancakes,waffles and
specialtywraps. This segmentincludesour brands
Van’s®
and
Crepini®.
Weproducethevastmajorityofourpreparedfoodsproductsatourfacilities. Themajorityoftheraw materialsusedinthe
productionof ourpreparedfoods productsare commodities,agricultural-basedproducts,includingliquidegg products,as well
aspackagingmaterial.Liquideggproductsaresourcedfromoutsidevendorsaswellasinternally.Themajorityofourraw
materials are sourcedfrom U.S. vendors andare generally availablefrom numerousvendors. We monitorchanges inprice of raw
materialsandsupplychaincostsandmayberequiredtoimplementmaterialpriceincreasesordecreasesinresponsetoany
significantchangesin costs.
Marketingand Distribution
In fiscal2026, wesold ourproductsin 47statesas well asPuertoRicothrough ourextensivedistributionnetworkto adiverse
groupofcustomers,includingnationalandregionalgrocerystorechains,clubstores,companiesservicingindependent
supermarketsin the U.S., foodservicedistributorsandegg product consumers.
The majorityof our shell egg andprepared foodssales are basedon the dailyor short-term needs ofour customers. Mostsales to
established accountsare on paymentterms ranging from seven to 30 days. Although wehave establishedlong-term arrangements
with manyof ourcustomers,mostof themare freeto acquireproductsfromother sources.
Theproductswesellareeitherdeliveredtoourcustomers’warehouseorretailstores,byourownfleetof,orcontracted
refrigerateddelivery trucks,or are pickedup byour customersatour processing facilities.
Wedistributeandsell
Egg-Land’sBest®
and
Land O’Lakes®
brandedeggs directlyandthrough ourjoint ventures,Specialty
Eggs,LLCandSouthwestSpecialtyEggs,LLC,underexclusivelicenseagreementsinAlabama,Arizona,Florida,Georgia,
Louisiana, Mississippiand Texas,and in portions of Arkansas,California, Kansas,Nevada,North Carolina, Oklahomaand South
Carolina.Wealso havean exclusive licensein NewYorkCity in additionto exclusivityin selectNew Yorkmetropolitanareas,
including areaswithin New Jersey and Pennsylvania.Asdiscussed aboveunder “BrandedEggs,”we also sell our own
Farmhouse
Eggs
®
4Grain
®,
Sunups®
and
Sunny Meadow®
brandedeggs. Wealsoproduce,marketanddistribute privatelabelspecialty
and conventionalshell eggsto severalcustomers.Ourprepared foodsofferingsincludeproducts soldunder ourbrands
Van’s®
and
Crepini®
.
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Customers
Ourtop threecustomersaccountedfor anaggregate
of
43.1%, 49.2%and49.0%of ournet salesdollarsforfiscal 2026,2025,
and 2024,respectively.Our largestcustomer,WalmartInc. (includingSam's Club),accountedfor 30.0%,33.6% and34.0%of
our consolidatednet salesdollars for fiscal2026,2025and2024,respectively.
Competition
The production,processing,and distributionof shelleggs is anintenselycompetitivebusiness,which hastraditionally attracted
large numbersof producersin theU.S.Shell egg competitionis generallybased onprice,service andproduct quality.The shell
eggproductionindustryremainshighlyfragmented.Accordingto
EggIndustryMagazine
, thetenlargestproducersowned
approximately57% and54% ofindustry tableegg layer hens atcalendaryear-end 2025and2024, respectively.
Themarketforpreparedfoodsishighlycompetitive,andincludesnationalandregionalfoodmanufacturers,privatelabel
producers, andfoodservice suppliers.Competitionis based on a varietyof factors, includingproduct quality,innovation,service,
price,manufacturingcapabilities,supplyreliability,and customerrelationships.The Companybelieves itsverticallyintegrated
supplychain,accesstoshellegginputs,manufacturingcapabilities,andbroadcustomerrelationshipspositionittocompete
effectivelyin these markets.
Seasonality
Retail sales ofshell eggs historicallyhave beenhighest duringthe fall and wintermonthsand lowest duringthe summermonths.
Prices forshell eggsfluctuatein response toseasonaldemandfactors anda naturalincrease inegg productionduring thespring
and earlysummer.Historically,shell eggprices tendto increasewith thestart of theschoolyear andtendto be highestpriorto
holidayperiods,particularlyThanksgiving,ChristmasandEaster.Asaresult,wehavehistoricallyexperienced,andmay
experiencein thefuture,lower shellegg sellingprices,salesvolumesandshell eggsales (andhaveincurred, andmayincur in
the future, netlosses)in our firstand fourthfiscal quartersending in August/Septemberand May/June,respectively.Becauseof
theseasonalandquarterlyfluctuations,comparisonsof ournet salesandoperatingresultsbetweendifferentquarterswithin
a
single fiscal yearare notnecessarily meaningfulcomparisons.
Certainofourpreparedfoodsexhibitmodestseasonality,withdemandgenerallysofteningduringthesummermonths,
particularlyinschool-related foodservicechannels.Overall,demandremainsrelatively stablegiven theportfolio’sbroadretail
andfoodserviceapplications.
Trademarksand LicenseAgreements
Thetable belowshows thetrademarksthat we ownedor licensedpursuantto licenseagreementsatMay 30,2026,as allocated
within ourreportablesegments. Webelieve thesetrademarksandlicense agreementsare importantto our business.
ReportableSegment
Trademark
ConventionalShell Eggs
Sunups® and Sunny Meadow®
SpecialtyShell Eggs
FarmhouseEggs®,4Grain®, Egg-Land's Best®and LandO'
Lakes®
PreparedFoods
Van's®and Crepini®
GovernmentRegulation
Our facilitiesand operationsare subjectto regulationby variousfederal,state,and localagencies,including,but not limitedto,
theFDA,USDA,EnvironmentalProtectionAgency(“EPA”),OccupationalSafetyandHealthAdministration(“OSHA”)and
correspondingstate agencies.The applicableregulations relateto grading,qualitycontrol, labeling,sanitarycontrol and reuse or
disposalofwaste.OurshelleggfacilitiesaresubjecttoperiodicUSDA,FDA,EPAandOSHAinspections.Ourshellegg
productionand feedmillfacilities as well as our prepared foodsoperationsare subject to FDA,USDA, EPAand OSHA regulation
and inspections,as applicable.We maintaininspection programsand in certain casesutilize independentthird-partycertification
bodiestomonitorcompliancewithregulations,ourownstandardsandcustomerspecifications.Itis possiblethatwe willbe
requiredtoincursignificantcostsforcompliancewithsuchstatutesandregulations.Inthefuture,additionalrulescouldbe
proposedthat, if adopted,could increaseour costs.
Further,the marketing,labeling andadvertisingof our productsare subjectto extensiveregulation underfederal,state andlocal
laws, includingconsumer protectionlaws. Changesin legal orregulatory requirements,including with respectto nutritionfacts,
13
allergendisclosures,servingsizestandards,front-of-packlabeling, ingredientor packagingrestrictions,or marketingpractices,
or differingor evolving enforcementpriorities, mayincrease our compliancecosts or require changesto our products,packaging
or marketingpractices.
A number of states havepassed legislation orregulations mandatingminimum spaceor cage-free requirements for egg production
or havemandatedthe saleof onlycage-free eggsandegg productsin theirstates.For furtherinformationrefer tothe heading
“SpecialtyShell Eggs”within thissection.
In addition,federalantitrustlaws requireregulatory approvalof acquisitionsthatexceedcertainthresholdlevels of significance
or thatcould otherwiseharmcompetition,andwe cannotguaranteethat suchapprovalswould beobtained.Further, currentor
future federalantitrust regulationsmayadversely affectcurrent operationsor financialconditionsuch asrequired divestitures or
spin-offs ofcertainbusiness or assetsandlimitations onthe typesor amountsof productswe could produce.
For moreinformationregarding governmentregulations thatmayaffectour business, refer to
.
EnvironmentalRegulation
Our operationsand facilitiesare subject tovarious federal,state, andlocal environmental,health andsafetylaws and regulations
governing,amongotherthings,thegeneration,storage,handling,use,transportation,disposal,andremediationofhazardous
materials. Underthese laws andregulations, we must obtainpermits from governmentalauthorities, including,but not limitedto,
wastewaterdischarge permits.Wehave made,and willcontinue tomake,capitaland otherexpenditures relatingto compliance
withexistingenvironmental,healthandsafetylawsandregulationsandpermits.Wearenotcurrentlyawareofanymaterial
capital expendituresnecessary tocomply withsuch lawsand regulations;however,as environmental,health andsafetylaws and
regulationsare becomingincreasinglymore stringent,includingthose relatingto animalwastes andwastewater discharges,itis
possible thatwe will have toincur significant costsfor compliancewith such laws andregulations in thefuture.
Human CapitalResources
AsofMay30,2026,wehad 4,909employees,ofwhom4,292 workedinoperationsandmarketing,and 617,includingour
executiveofficers, wereadministrativeemployees. Approximately3.0% ofourpersonnelare part-time. Wealso usetemporary
employmentagenciesandindependentcontractorsto supplementourworkforcewhenneeded;forfiscal2026,wehad1,943
averagemonthlycontingent workers.As of May 30, 2026, 40 employeeswere coveredby a collective bargainingagreement.We
believe ouremployeerelations aregood.
Our abilityto operatesafely,efficientlyand incompliancewithapplicablefood,workplacesafetyand employmentregulations
dependson attracting,retaining,training anddevelopingemployeesacross ouroperations,sales,marketingandadministrative
functions. Wefocus our humancapital efforts on workplacehealth and safety,employee relations, competitivecompensationand
benefits,compliancetraining, operationaltraining andleadership development.
Health and Safety
The healthand safetyof our employeesis a priority.Our Safetyand HealthProgram is designedto promote safework practices,
reduce workplace accidentsand illnesses, and support compliancewithapplicableOccupationalSafety and Health Administration
requirements.Theprogram appliesacross theCompanyand is supported by anenterprisesafetycommitteeand site-level safety
committeeswith employeerepresentation.
Wereview our writtensafetypolicies at least annuallyand monitorsafetyperformanceon a monthly basis to identifytrends and
opportunities for improvement.We also providemulti-lingualsafetyand compliancetraining on topics relevant to our operations,
including use of personalprotective equipment,emergency response,equipmentsafety,chemical hazard communication,hearing
conservation,lockout/tagoutprocedures, forkliftsafetyand other job-specific safetypractices. Contractorsand vendorsworking
atour facilities are expectedto complywith applicablesafetyrequirements.
14
Employee Culture and Conduct
Weseek to maintaina workplace culture groundedin integrity,respect, productivityand ethical conduct.Our
Code of Ethics and
Business Conduct
,
HumanRightsStatement
and otheremployee policiessupport ourcommitmentto lawful and ethicalconduct
andto aworkplacefree fromharassment,discrimination,unlawfulconductandretaliation.
WeareanEqualOpportunityEmployerandprohibit discriminationon anybasis protectedby applicablefederal,stateor local
law.Wearecommittedto providingemployeeswithopportunitiesconsistentwithouroperationalneeds andtheir experience,
goals andcontributions.
Compensation,Benefits,Trainingand Development
Weseek to attract,retain and developemployees byofferingcompetitivewages andbenefits andby providing trainingrelevant
to safety,regulatory compliance,job-specific skillsandleadership development.We offereligible full-timeemployeesa range
ofhealth,welfareandretirementbenefits,includingparticipationinourKSOPretirementplan,underwhichtheCompany
contributesshares ofCompanystock or acashequivalentequalto 3%of eligiblecompensationfor eachpayperiodin which
hours areworked.Wealso supportemployeedevelopmentthrough safety,complianceand task-specific training, aswellas our
ManagementIntern,ManagementTraineeandinformalmentoring programs.
Sustainability
Weunderstandthat responsible managementof our flocks, among other things, is vital to theproductionof high-quality eggs and
eggproductsand tothe successoftheCompany.Wehaveengagedinagriculturalproductionformorethan60years.Our
agriculturalpracticescontinuetoevolveaswe continuetostriveto meettheneedfor nutritious,affordablefoods tofeeda
growingpopulationwhilestillexercisingresponsiblenaturalresourcestewardshipandconservation.Wewillpublishour
sustainabilityimpactreportforourfiscal2025inthefirstquarteroffiscal2027,whichwillbeavailableonourwebsite.
Informationcontainedon our website is nota partof this reporton Form 10-K.
Our CorporateInformation
Wemaintainawebsiteatwww.calmainefoods.comwheregeneralinformationaboutourbusinessandcorporategovernance
mattersis available.The informationcontainedon our websiteis nota partof thisreport.Our AnnualReports onForm10-K,
QuarterlyReports onForm 10-Q,Current Reportson Form 8-K,proxystatements,and all amendmentsto those reportsfiled or
furnishedpursuantto Section13(a) or15(d)of theExchangeActareavailable,free ofcharge,through ourwebsiteas soonas
reasonablypracticableafterwefilethemwith,orfurnishthemto,theSEC.Inaddition,theSECmaintainsawebsiteat
www.sec.govthatcontainsreports,proxyandinformationstatements,andotherinformationregardingissuersthatfile
electronicallywith theSEC.
ITEM 1A.RISK FACTORS
Our businessand resultsof operationsare subjectto numerousrisks anduncertainties,many of whichare beyondour control.
Thefollowingisa descriptionoftheknownfactorsthathaveormayinthefuturemateriallyaffectourbusiness,financial
condition orresults of operations.They shouldbe consideredcarefully, inaddition tothe informationset forthelsewhere inthis
AnnualReporton Form10-K, includingunderPart II.Item 7.Management’sDiscussionand Analysisof FinancialCondition
and Resultsof Operations,inmakingany investmentdecisionswithrespectto oursecurities.Additionalrisks oruncertainties
that arenot currently known tous,orthat weare awareof butcurrently deemto beimmaterial orthat could apply to any
company couldalso materiallyadversely affectour business, financialcondition or results of operations.
See
“Forward-Looking
Statements” at the beginning of thisreport.
INDUSTRYRISK FACTORS
Marketpricesof wholesaleshelleggs arevolatileand decreasesin thesepriceshavehad, and inthefuture mayhave, a
materiallyadverse impacton our revenuesand profits.
Our operatingresults aresignificantlyaffectedby wholesale shellegg marketprices, whichfluctuatewidely andare outsideour
control.Wholesaleshelleggmarketpricesdirectlyaffectthe sellingpricesofourproductssoldundermarket-basedpricing
formulasandmayindirectly impactour productssoldunder cost-basedandhybrid pricingformulasas customersmayseek to
renegotiatethetermsof theirarrangementsduringperiodsof sustainedlowprices.Accordingly,ourhistoricalresultsare not
necessarilyindicativeof futureperformance.
15
Modest increasesin industry supplyor decreases in demandhave resulted in, and mayinthe future havea material adverse effect
on shell eggprices. Lowshell egg pricesadverselyaffectour revenuesandprofits.
Market pricesfor wholesaleshell eggshave been,and inthe futuremaybe, volatile andcyclical.Shell eggprices haverisenin
the pastduring periodsof highdemandsuch asthe initial outbreakof theCOVID-19 pandemicandperiods when highprotein
dietsarepopular.Shelleggpriceshavealsorisenduringperiodsofconstrainedsupply,suchasduringoutbreaksofhighly
pathogenicavianinfluenza(“HPAI”).Duringtimeswhenpricesare high,the eggindustryhastypicallyproducedmoreeggs,
primarilybyincreasingthenumberoflayers,whichhistoricallyhasultimatelyresultedinanoversupplyof eggs,leadingto
periodsof lower prices.
As discussed abovein
,seasonal fluctuationsimpactshellegg prices.Therefore, comparisons
ofoursalesandoperatingresultsbetweendifferentquarterswithinasinglefiscalyeararenotnecessarilymeaningful
comparisons.
Adeclineinconsumerdemandfor shelleggsorour preparedfoodsofferingshave had,and inthefuturemay have,a
materialadverse impactour business.
Webelieve high-proteindiet trends,industry advertisingcampaigns,the improvednutritionalreputationof eggs andan increase
in at-home consumptionof eggs duringthe COVID-19pandemic,have allcontributedat onetime oranotherto increasedshell
egg demand.However,it is possible thatthe demandfor shell eggs will declinein the future. Adversepublicity relatingto health
orsafetyconcernsandchangesintheperceptionof thenutritionalvalueofshelleggs,changesinconsumerviewsregarding
consumptionof animal-based products,as well as movementaway fromhigh protein diets,have hadand in thefuture mayhave
an adverseeffecton demandfor shell eggs, which has hadand in the future couldhave a materialadverse effecton our results of
operationsandfinancialcondition.
Certainof our preparedfoods offeringsare generallysubject to changingconsumer trends,demandsand preferencesas well asa
modest amountof seasonality. Trends withinthe prepared foodsindustry change often,and failure toidentify and reactto changes
inthesetrendscouldleadto,amongotherthings,reduceddemandandpricereductionsforourpreparedfoodsbrandsand
products.Westriveto respondtoconsumerpreferencesandsocialexpectations,but wemaynot besuccessfulinourefforts.
Further,wecouldbeadverselyaffectedifconsumersloseconfidenceinthesafetyandqualityofcertainfoodproductsor
ingredients,or thefoodsafetysystemgenerally.Prolongednegativeperceptionsconcerningthe healthimplicationsof certain
food productsor ingredientsor lossof confidencein thefood safetysystem generally couldinfluenceconsumer preferencesand
acceptanceof someof ourproductsandmarketingprograms.Continuednegativeperceptionsandfailuretosatisfyconsumer
preferencescould havea materialadverseeffecton our sales,financialconditionandresults of operations.
Feed costsarevolatile andincreasesin thesecostshavehad,andin the futuremay have,a materialadverse impactour
results ofoperations.
Feedcosts arethe largestelementof ourshell eggproductioncost,typically exceeding50% ofour totalfarm productioncosts.
Although feed ingredients,primarily corn andsoybeanmeal, are available froma number of sources, we do not have control over
thepricesof theingredientswepurchase,which areaffectedby weather,variousglobalandU.S. supplyanddemandfactors,
transportationandstorage costs,speculators,agricultural,energyandtradepolicies intheU.S.andinternationally,andglobal
instability,includingas a result of geopolitical conflicts. For example,while feed costs declined during fiscal 2026,we saw higher
prices for cornand soybeanmeal over the lastfour fiscalyears as aresult ofweather-related shortfallsin productionandyields,
ongoingsupplychaindisruptions,andgeopoliticalconflictsandtheirimpactontheexportmarkets.Ourcostsforcornand
soybeanmealare alsoaffectedby local basisprices.
Increasesinfeed costsunaccompaniedby increasesinthe sellingpriceof eggshave hadand inthe futuremayhave amateria
l
adverseeffecton theresults ofouroperationsandcashflow. Decreasesin feedcosts canlead toincreasedegg productionand
increases inthe egg supply,possiblyresulting inlower egg pricesandlower revenue.
Increasesinotherinputcostssuchaspackagingmaterials,deliveryexpenses,constructionmaterialsandequipment,
includingasa resultofinflationandtariffs,havehadandinthefuturemayhave,a materialadverseimpactonour
profitability.
In addition tofeed ingredientcosts,other significantinput costs includecosts of packagingmaterials anddelivery expenses.Our
costsof packagingmaterialsincreasedduring thepastthree fiscalyears dueto inflationandhigher laborcosts,andthesecosts
maycontinueto increase.Wehavealso experiencedincreases indelivery expensesdue toincreasesin fuelandlabor costsfor
bothourfleetandcontracttrucking, andthese costsmaycontinueto increase.ChangesinU.S.tradeandtariffspolicieshave
causedandmaycontinueto causehigher costsforconstructionmaterials,equipment,packagingandother items.Increasesin
these costsare largelyoutside ofour controlandcould havea materialadverseeffecton our profitabilityandcashflow.
16
Agriculturalrisks,includingoutbreaksof aviandiseasessuchas HPAI,have harmedand inthefuture couldharmour
business.
Our shellegg productionactivitiesare subjectto avariety ofagriculturalrisks.Unusualor extremeweatherconditions,disease
and pestshave hadand in the future mayhave a materialadverse effecton the quality andquantityof shell eggs we produceand
distribute.HPAIiscurrentlywidespreadinthewildbirdpopulationworldwide.OutbreaksofHPAIamongpoultryoccur
periodicallyworldwide,includingrecentlyintheU.S.,withanincreasedrisk duringmigratoryseasonsforwildbirds.HPAI
outbreaksinthe U.S.have in the past causedsignificant depopulationof U.S.commercialtable egg layer flocks, which contributed
tolowershelleggsuppliesandhighershelleggprices.Forexample,duringthethirdandfourthquartersof fiscal2024,we
experiencedHPAIoutbreakswithin ourfacilitieslocatedin KansasandTexas,andin Marchof 2026weexperienceda HPAI
outbreakwithin ourpulletfacilityin Maryland,resulting inthe depopulationof approximately352,000pullets. Foradditional
information,refer to
Wemaintaincontrolsandproceduresdesignedtoreducetheriskof exposingourflocksandemployeestoharmfuldiseases;
however,despitethese efforts,outbreaksof aviandiseases haveoccurred andmayoccur, which hashadandin the future may
have a materialadverse impacton thehealth of our flocksand inthe futurecould adverselyimpactthe health ofour employees.
Continuedor intensifiedspreadof HPAIcouldhavea materialadverseimpacton our financialresults by,amongother things,
decreasingrevenue,increasingcosts, increasinggovernmentrestrictionson thesale anddistributionof ourproducts,other new
regulatoryrequirementsandrequiringus toeuthanizethe affectedlayers. NegativepublicityfromHPAIoutbreakswithinour
industry cannegativelyimpactcustomerperception.If a substantialportion of ourlayers orproductionfacilitiesareaffected by
any ofthese factorsin anygiven quarteror year,our business,financial condition,and resultsof operationscould bematerially
andadverselyaffected.
Our shelleggs, preparedfoodsand eggproductsofferingsare susceptibleto contamination,and wemaybe requiredto,
or we mayvoluntarily,recallcontaminated products.
We sellfood productsfor humanconsumption, including shell eggs, prepared foodsand egg products, which involvesfood safety
risks suchas:
●
food contaminationcausedby disease-producingorganismsor pathogens,such as Listeriamonocytogenes,Salmonella
Enteritidis,and pathogenicE Coli., including contaminationcausedby introduction of pathogensas a result of improper
handlingbycustomersorconsumers(overwhichwehavenocontrol),orbyoperationalerrorsbysuppliersorco-
manufacturersor in our facilities;
●
mislabeling,includingwith respectto foodallergens;
●
foodspoilage;
●
nutritionalandhealth-related concerns;and
●
producttampering.
Shipmentof contaminated,mislabeled, spoiledor otherwisedeficient products,even ifinadvertent,could result ina violationof
law andlead to increasedrisk of exposureto productliability claims,product recallor withdrawaland scrutinyby federal,state
and local regulatoryagencies. Wehave little, if any,control over proper handlingonce the product hasbeen shippedor delivered.
In addition, productspurchasedfrom other producers could containcontaminants, or be spoiled, mislabeled or otherwisedeficient
that mightbeinadvertentlyredistributedor sold byus. Assuch, we mightdecideor berequiredto recallor withdrawa product
if we, our customers or regulators believeit poses a potentialhealth risk. This has occurred in the past andmayoccur inthe future.
Any shipmentof deficient productor anyaction takenin response, suchas aproductrecall or withdraw, couldresult in a lossof
consumerconfidencein our products,adverselyaffectour reputationwith existingand potentialcustomersand havea material
adverseeffectonourbusiness,resultsofoperationsandfinancialcondition.Wecurrentlymaintaininsurancewithrespectto
certainof these risks,includingproduct liabilityinsurance,business interruptioninsurance,product recallinsurance andgeneral
liability insurance,but in manycases such insurance is expensiveand difficult toobtain, andno assurancecan be given thatsuch
insurance will adequatelycover our costs orcan be maintainedinthe future on acceptable termsor insufficient amountsto protect
us againstlosses dueto anysuch events,or at all.
BUSINESSAND OPERATIONALRISK FACTORS
Our acquisitiongrowth strategysubjects usto variousrisks.
As discussed in
we plan tocontinue topursue a growthstrategy thatincludes, in part,
selective acquisitionsof other businessesengagedin the productionand sale ofshell eggs andprepared foods,with apriorityon
those thatwill facilitateour ability toexpandour specialtyshell egg andprepared foodsproductioncapabilitiesin key locations
and markets.We may over-estimate or under-estimate the demandfor specialty shell eggs or our preparedfoods offerings,which
17
couldcauseouracquisitionstrategytobeless-than-optimalforourfuturegrowthandprofitability.Thenumberofexisting
businesseswithspecialtyshell eggcapacitythat we maybe ableto purchaseis limited.Conversely,whenwe acquirespecialty
shell egg productioncapacity,which is more expensive to purchaseand operate,and customer demandsor legalrequirementsfor
specialtyshell eggswereto change,anyresultinglack ofdemandfor specialtyshelleggshasandinthe futuremayresult in
higher costs andlower profitability.
Althoughwehadalreadydiversifiedourbusinesswithsomepreparedfoodsproductofferings,ouracquisitionofEchoLake
Foods in the first quarterof fiscal 2026 representeda significant expansionof our strategy to diversify ourproduct mixto include
more preparedfoods.Accordingly,we haveexperiencedand inthe futuremayexperienceunexpectedchallengesin integrating
andmanagingthepreparedfoodsbusinessesandbrandsthatweacquirefromtimetotime.Integratingthepreparedfoods
businessesandbrandsthatweacquire,maybemorecostlyortime-consumingthanweexpect.Evenifthesebusinessesand
brands aresuccessfully integrated,we maynot realize thebenefitswe expectfromthe acquisitions,including the synergies, cost
savings,reductioninearningsvolatility,strongmanagementteam,marginexpansion,financialreturns,neworexpanded
customer andvendor relationships, or sales or growth opportunities.Our experience managingprepared foodsbusinesses is much
more limitedthanour experiencemanagingour shellegg andegg productsbusinesses,and ourstrategyto diversify ourproduct
mix to includemore preparedfoods maynot producethe favorablefinancial andother resultsthat weanticipate.For additional
informationregarding ouracquisitionsand ourstrategy to diversifyour productmixto includemore preparedfoods,see PartI.
Item1. Business –
and
Acquisitionsrequire capital resourcesand candivert management’sattention fromour existing business. Acquisitionsalso entail
an inherent risk thatwe could become subjectto contingentor other liabilities, including liabilities arising from eventsor conduct
priortoouracquisitionof abusinessthatwere unknowntous atthetimeofacquisition.Wecouldincur significantlygreater
expendituresin integrating anacquiredbusiness thanwe anticipatedatthe timeof its purchase.
Wecannotassure youthatwe:
●
will identifysuitable acquisitioncandidates;
●
canconsummateacquisitionson acceptableterms;
●
cansuccessfully integrateanacquiredbusiness into ouroperations;or
●
cansuccessfully managethe operationsof anacquiredbusiness.
Noassurancecanbegiventhatbusinessesweacquireinthefuturewillcontributepositivelytoourresultsofoperationsor
financialcondition.In addition,federalantitrustlaws requireregulatoryapprovalof acquisitionsthatexceedcertainthreshold
levelsof significanceor thatcould otherwisenegativelyaffectcompetition,and wecannotguaranteethat such approvalswould
be obtained.Further, currentor future federal antitrustregulations mayadversely affectcurrent operationsor financialcondition
suchas requireddivestituresor spin-offsof certainbusinessor assetsandlimitationsonthetypes oramountsof productswe
could produce.
Theconsiderationwe payinconnectionwith anyacquisitionaffectsour financialresults.If wepay cash,we couldbe required
touseaportionofouravailablecashorcreditfacilitytoconsummatethe acquisition.Totheextentweissuesharesofour
CommonStock, existing stockholdersmaybe diluted. In addition, acquisitionsmayresult inadditionaldebt. Our ability to access
anyadditionalcapitalthatmaybe neededfor anacquisitionmaybe adverselyimpactedby higher interestrates andeconomic
uncertainty.
Disruptionstoourproduction,supplychainordistributionoperations,ortotheoperationsof keycustomersorsales
channels, couldhave a materialadverse effectour business andoperations.
Our abilityto produce, supplyand distributeshell eggsand preparedfoods efficientlyand reliablyis criticalto our success.Our
operationsdepend on thecontinuedavailability andeffectivefunctioningof ourproductionfacilities, supply chain,logistics and
distributionnetworks, some ofwhich are supportedby third-party providers.A significant disruptionto any of these capabilities,
whether due tooperationalfailures, labor shortages,transportationdisruptions, facility outages,facility upgradesor other events,
could impairour ability to meet customerrequirements oroperateina profitable manner.For example, Echo LakeFoods has and
is expectedtocontinueto experiencea temporaryreductionin productionvolumesandhigher costs,whichbeganlateinthe
second quarterof fiscal 2026 andare expectedto be completed in fiscal2027. Wemaynot be able to successfullycomplete these
expansionprojectstimely or onbudget,if at all.
Inaddition,werelyonourcustomersandestablishedsaleschannelstosellourproductstoultimateconsumers.Disruptions
affectinga significant customer, distributor,foodserviceprovider, retailer or other sales channel,including operationaldisruptions
or changes in purchasingor distribution practices,could result in reduced salesvolumes,delays in product movement,or changes
in themix ofproducts sold.Anysuch disruptionscould havea materialadverse effecton our resultsof operationsand financial
condition.
18
Our largestcustomershave accountedfor a significantportion ofour netsales, andthe loss of,reduced purchasesby,or
pricing pressurefrom, oneor moreof suchlargecustomers couldhave a materialadverse effecton our business.
Our top threecustomersaccountedfor an aggregate of 43.1%,49.2% and49.0% of our netsales for fiscal2026,2025 and2024,
respectively.Ourlargestcustomer,WalmartInc.(includingSam's Club),accountedfor 30.0%,33.6% and34.0%of netsales
dollarsforfiscal2026,2025and2024,respectively.Althoughwehaveestablishedlong-termrelationshipswithmostofour
customerswhocontinuetopurchasefromus basedon our abilityto servicetheirneeds,theyare generallyfreeto acquireour
productsfromothersources.If, foranyreason,oneor moreofourlarge customerswereto purchasesignificantlyless ofour
products inthe future,terminatetheir purchasesfrom us ordemandsignificantly lowerpricing, andwe were notable tosellour
products tonew customers atcomparablelevels, it would havea material adverseeffecton our business, financial condition,and
results ofoperations.
The sophisticationand buying power of certainof our customers,includingtheir ability to expandprivate-labelofferings,
could adverselyaffectour pricing, marginsand resultsof operations.
Certainofourcustomers,includinglargeretailers,warehouseclubs,foodserviceprovidersanddistributors,arelargeand
sophisticatedand havesignificant bargainingpower.These customersmaybe more capableof resisting priceincreases and may
demandlower pricing,increasedpromotionalactivity,alternativepricingstructures,orcustomizedproductsandservices.In
addition,some of thesecustomershave thescale andresourcesto operatewithreducedinventories,modify sourcingstrategies,
ordevelopandmarkettheirownprivate-label orstore-brandproductsthatdirectlycompetewithourbrandedandspecialty
offerings.Shelf spaceand productplacementat retail customersare not guaranteed,and customersmaychoose to allocateshelf
spaceto competingproducts,including private-labelor lower-pricedalternatives.
Theserisks maybe exacerbatedduring periods ofeconomic weakness,inflation,or elevatedfood prices,whenconsumers may
trade down to lower-pricedoptions,reduce purchasesof specialty products, or shiftpurchasesto private-label offerings.If we are
unabletoeffectivelyrespondtothesecompetitivepressuresthroughpricing,costcontrol,operationalefficiencies,orproduct
innovation,orif ourcustomersmateriallychangetheirpurchasingpracticesorexpandcompetingprivate-label offerings,our
sales volumes,profitabilityandresults of operationscould bemateriallyadverselyaffected.
High market prices foreggs, primarilycaused by HPAI-relatedreductionsin supply, haveled to pressurefrom customers
to changelong-standingmarket-basedpricing frameworksand/or otherwisereducethe priceof our eggsand maydo so
in thefuture.Amaterialchangein oursalesarrangementswithkey customerscouldhave amaterialadverseeffecton
our revenues,gross profitsand net income.Otherreactionsto highegg prices,includingby stateorfederal government
agencies, mayalso adverselyimpact our business.
Market pricesfor wholesaleshell eggs havebeen volatileand cyclicalovertime. Marketpricesfor eggstend to increaseduring
andfollowing outbreaksof agriculturaldiseasesin theeggindustrythatreduce thesupplyofeggs, whichhasoccurredduring
HPAIoutbreaks,until thesupplyand demandbalanceis restored. Someof oursales arrangementswithcustomers,particularly
forconventionalshelleggs,arebasedonformulasthattakeintoaccount,invaryingways,independentlyquotedregional
wholesale marketprices foreggs. High marketprices foreggs have led to pressure from customers to change longstandingmarket-
based pricingframeworksand/orotherwise reducethe price ofour eggsand maydo so in the future.To remaincompetitiveand
retain our customersand gain new ones, wemust consider ourcustomer relationshipsand the reactionsand potentialreactions of
competitors. A materialchange in our sales arrangementswithkey customers could havea material adverse effecton our revenues
andgross profits.
Otherreactionstohigheggprices,includinginvestigationsorlawsuitsbystateorfederalgovernmentagenciesorprivate
plaintiffs,mayalso adverselyimpactour business.In March2025,we receiveda civilinvestigativedemandinconnectionwith
awidelypublicizedinvestigationbytheAntitrustDivisionoftheDepartmentofJustice(“DOJ”)intothecausesbehind
nationwideincreases inegg prices.Wesettled thecase in June2026, but thesettlement remainssubject tocourt approvalwhich
mayor maynot beobtained.Since November2025,wehavebeen namedas adefendant,along with othereggproducersand
industryassociations,invariousclassactionsthatallegethe defendantsconspiredtofix theprices ofconventionalshell eggs
nationwide,primarilythroughmanipulationofindustrypricebenchmarks,coordinatedreporting,andsupplyrestrictions,
particularlyduringthe2022avianflu outbreak.In addition,persistent highegg pricesmaycausesome consumersto purchase
fewereggs.Persistenthigh-pricecycles,investigationsandlawsuitsmayalsoincreaseattentionon theeggindustry,andthe
Companyspecifically,bystateandfederalgovernmentagenciesorplaintiffs,whichmayleadtoadditionalgovernment
investigations,lawsuits orrelated activities,includingbut not limitedto the adoptionof new regulations.For further discussion,
see Part I. Item 3. Legal Proceedings below andPart II. Item 8. Notes to the Consolidated FinancialStatements,
.Thepotentialimpactsofthesereactionsonourbusinessareunclear,unpredictableandmaydivertour
resourcesandattentionfromour core businessactivities, which mayhavea materialadverseeffecton our business.
19
Our businessis highly competitive.
The productionandsale offresh shell eggs, whichaccountedfor 84.6% to 94.3%of ournet salesin our last threefiscal years,is
intenselycompetitive.Wecompetewitha largenumberof competitorsthatmayprove tobemoresuccessfulthanwe arein
producing,marketing andselling shell eggs.Wecannotprovide assurancethat we willbe able to competesuccessfully withany
or all of thesecompanies.Increasedcompetitioncould result in price reductions,greater cyclicality,reduced marginsand loss of
marketshare, which would negativelyaffectour business, results ofoperations,andfinancialcondition.
Inaddition,ourgrowthstrategyincludesexpansionofourproductofferingsincludingpreparedfoods.Thepreparedfoods
businessis intenselycompetitiveand includescompetitionfrom otherpreparedfood companiesand other suppliersof prepared
andconveniencefoods,includingrestaurants,grocery storesandconveniencestores, manyof whichhavemore experienceor
scale operatingprepared andconveniencefoods businesses.In responseto thesecompetitivepressures,we mayhave toreduce
the prices of our products,or increase or reallocateour spending on marketing,advertisingand promotionalactivity.Competitive
pressuresmayalso restrictour abilityto increase prices,includingin responseto commodityand other input costincreases.Our
profitscould decreaseif eithera reductioninprices orincreasein costswithout comparableincrease in priceis not offsetwith
increasedsalesvolume.Alternatively,if wedo notreduce ourpricesor increaseour prices,as applicable,andour competitors
seek advantagethrough pricing or promotionalchanges, our revenues,profitabilityand marketshare could be adversely affected.
Weare dependenton ourmanagementteam, andthe lossof anykey memberof thisteam mayhave amaterialadverse
effecton the implementationof our businessplan in atimely manner.
Our successdependslargely uponthe continuedservice ofoursenior managementteamand the recruitmentof additionalteam
membersaswegrow.Thelossorinterruptionofserviceofoneor moreofourkeyexecutiveofficerscouldhaveamaterial
adverseeffecton our abilityto manageour operationseffectivelyand/orpursue ourgrowth strategy.Wehavenot enteredinto
anyemploymentor non-competeagreementswithanyof ourexecutiveofficers.Competitioncouldcauseus tolosetalented
employees,andunplannedturnovercould depleteinstitutionalknowledge.Increasedcompetitionfor employeeshas, andmay
continueto, result in increasedcosts.
Ourbusinessisdependentonourinformationtechnologysystemsandsoftware,andfailuretoprotectagainstor
effectivelyrespond to cyber-attacks,securitybreaches,orother incidentsinvolvingthosesystems, couldadversely affect
day-to-dayoperationsanddecisionmakingprocessesandhaveamaterialadverseeffectonourperformanceand
reputation.
The efficientoperationof our businessdepends onour informationtechnology systems,which werely on to effectivelymanage
ourbusinessdata,communications,logistics,accounting,regulatoryandotherbusinessprocesses.Ifwedonotallocateand
effectivelymanagethe resources necessary tobuild and sustainan appropriatetechnology environment,our business, reputation,
or financialresults couldbe negativelyimpacted.In addition, our informationtechnology systemsmaybe vulnerableto damage
orinterruptionfromcircumstancesbeyondourcontrol,includingsystemsfailures,naturaldisasters,terroristattacks,viruses,
ransomware,securitybreachesorcyberincidents.Cyber-attacksare becomingmoresophisticatedandareincreasinginthe
number ofattemptsand frequencyby groups andindividuals witha widerange ofmotives.Wehave experiencedand expectto
continueto experienceattemptedcyber-attacksof ourinformationtechnologysystemsor networks.
We regularlyengage with third-party service providersas part of our operationsto provide a highlevel of service to ourcustomers.
Wehave implementedcertain practicesand policiesto minimize thepotential risksassociatedwith the exchangeof information
withcontractedvendors.Despite thesepracticesandpolicies, wecannotguaranteethat informationtechnologysystemsof our
third-partyserviceproviderswillpreventanddetectall cybersecuritybreachesandincidents.Althoughwerequirethird-party
service providersto notify us upon a potentialbreach or incident, there is a potential risk that our business, reputation,or financial
results couldbe negativelyimpactedby cybersecurityincidents attheir businesses.
Additionally,future or past business transactions(such as acquisitions or integrations) haveexposed andinthe future mayexpose
us toadditionalcybersecurityrisks andvulnerabilities,as oursystemscouldbe negativelyaffectedby vulnerabilitiespresentin
acquiredor integratedsystemsandtechnologies.Furthermore,we maydiscover securityissuesthatwere not foundduring due
diligence of such acquiredor integrated businesses, anditmaybe difficult to integrate businessesinto our informationtechnology
environmentandsecurity program.
Our informationtechnology systemsalso subjectus to numerousdataprivacy obligations.We mayat times fail(or be perceived
to havefailed) inourefforts tocomplywith ourdataprivacy obligations.If weor thethird partieson whichwe relyfail, orare
perceived tohave failed,to addressor complywith applicabledataprivacy obligations,we couldface significantconsequences,
including but not limited to governmentenforcementactions and litigation.A security breach of sensitive informationcould result
in damageto our reputationand ourrelationswith ourcustomersor employees.Anysuch damageor interruptioncould have a
materialadverseeffecton our business.
20
Technologyandrelatedbusinessandregulatoryrequirementscontinueto changerapidly.Failuretoupdateor replacelegacy
systemstoaddressthesechangescouldresultinincreasedcosts,includingremediationcosts,systemdowntime,thirdparty
litigation,regulatory actionsor cyber securityvulnerabilitieswhich couldhavea materialadverseeffecton our business.
Weare currentlyimplementinga newenterpriseresourceplanning(“ERP”) system,and difficultieswith thistransition
could have amaterialadverse effecton our business
.
We arein the process of replacingand modernizingour core financial andoperational systemsthrough a new ERP platform.This
implementationis a complex,multi-phaseprojectthathasandwill requiresignificantinvestmentof time,capital,andinternal
resources.Therecan beno assurancethat the ERPsystem willbe implementedon theexpectedtimeline,withinbudgetor with
the intendedfunctionality.
Challengesassociatedwith the ERPtransition,includingdataconversion issues,system integrationproblems, processredesign,
user adoptiondifficulties, or disruptions to existing operationscould impair our ability to process transactions,manage our supply
chainandhumanresources,produceaccurateandtimelyfinancialreports,maintaineffectiveinternalcontrolsoverfinancial
reporting or otherwisedisrupt our businessoperations.The implementationmay also divert management’s attentionfrom normal
businessoperations.
If we areunable to successfully completethe ERP implementation,or ifunexpectedissues ariseduring the transition, our business,
financialcondition,results of operations,andinternal controlenvironmentcould bemateriallyadverselyaffected.
Laborshortagesorincreasesinlaborcostshavehadandinthefuturecouldhaveamaterialadverseimpactonour
businessand resultsof operations.
Oursuccessisdependentuponrecruiting,motivating,andretainingstaffto operateourproductionfacilities.Approximately
80.7% ofour employeesare paidat hourlyrates, oftenin entry-level positions.While allouremployeesare paid atrates above
the federalminimumwage requirements,anysignificantincreaseinlocal, stateor federalminimumwage requirementscould
increase ourlabor costs.In addition,any regulatorychangesrequiring usto provideadditionalemployee benefitsor mandating
increases inother employee-related costs,such as unemploymentinsurance or workerscompensation,would increaseour costs.
Ashortagein thelaborpool,which maybe causedby competitionfromother employers,theremotelocationsof manyof our
productionfacilities, decreasedlaborparticipationratesorchangesingovernment-providedsupportorimmigrationlawsor
policies,particularlyintimesof lowerunemployment,hashadandin the futurecouldhaveanadversematerialeffecton our
business andresults of operations. A shortage of labor availableto us could cause our production facilitiesto operate with reduced
staff,which could negativelyimpactour productioncapacityand efficiencies. Infiscal 2025and 2026,labor wages continuedto
rise duetoinflationandlow unemployment.Any significant laborshortagesor increasesin ourlabor costshashad,andin the
futurecould have,a materialadverseeffecton our results ofoperations.
Wealso relyon third-partysuppliersfor theprovisionof contingentworkers,andour failuretoeffectivelymanageour use of
such contingentworkerscould increaseour costs andadversely affectour results of operations.Wemaybe subject to shortages,
oversupply,or fixedcontractualterms relatingto contingentworkers.Ourabilityto managethe size andcostof ourcontingent
workforcemaybe subjectto additionalconstraintsimposedby local laws.
Global or regionalhealth crises,including pandemicsor epidemics,could have a materialadverse impacton our business
and operations.
Theeffectsofglobalorregionalpandemicsorepidemicshavehadandinthefuturemayhaveasignificantimpactonour
operations.Althoughdemandforourproductscouldincreaseasaresultofrestrictionssuchastravelbansandrestrictions,
quarantines, shelter-in-place orders, andbusiness and governmentshutdowns, whichcan promptmore consumers to eatat home,
theserestrictionscouldalsosignificantlyincreaseourcost ofdoing businessdue tolaborshortages,supply-chaindisruptions,
increasedcosts anddecreasedavailability of packagingsupplies orfeed, and increasedmedical andother costs.Weexperienced
theseimpactsas aresultof theCOVID-19pandemic,primarilyduringourfiscalyears 2020and2021.Theimpactsof health
crises are difficult topredict anddepend on numerousfactors including the severity, lengthand geographicscope of the outbreak,
resurgencesof thediseaseandvariants,availabilityandacceptanceof vaccines,andgovernmental,businessandindividuals’
responses.
LEGAL ANDREGULATORYRISK FACTORS
Pressurefrom animal rightsgroups regardingthe treatmentof animals may subjectus to additional coststo conform our
practicestocomplywithdevelopingstandardsorsubjectustomarketingcoststodefendchallengestoourcurrent
practicesand protectour imagewith ourcustomers.In particular,changes incustomerpreferencesand statelegislation
21
have acceleratedan increasein demand forcage-free eggs,which increasesuncertaintyin our businessand increases our
costs.
Weand manyof our customers facepressure from animal rightsgroups, such as People forthe Ethical Treatmentof Animals and
theHumaneSociety ofthe U.S., torequirecompaniesthatsupply foodproductsto operatetheir businessesina mannerthat
treats animalsin conformitywith certainstandardsdeveloped or approvedby thesegroups. In general,we mayincur additiona
l
costs ifwe conformour practicesto addressany of thesestandardsor to defendour existing practicesto protectour imagewith
ourcustomers.Thestandardspromotedby thesegroups changeover time,but typicallyrequire minimumcagespacefor hens,
amongother requirements,and someof these groupshave led successfullegislative effortsto banany formof cagedhousing in
variousstates.
Asdiscussedin
,tenstateshavepassedminimumspaceand/orcage-free
requirementsforhens,andotherstatesare consideringsuchrequirements.Inaddition,asignificantnumberof ourcustomers
have announcedgoals to either exclusivelyoffercage-free eggs or significantlyincrease the volumeof cage-free egg sales in the
future, subjectin most casesto availabilityof supply,affordabilityand consumerdemand,amongother contingencies.While we
anticipatethat our retail and foodservice customerswillcontinue to transitionto selling cage-free eggs given publicly statedgoals,
thereis noassurancethatthis transitionwilltakeplace ortakeplace accordingtothetimeline ofcurrentcage-freegoals. For
example,customers mayacceleratetheir transition to stocking cage-free eggs,which maychallenge our ability tomeet the cage-
freevolumeneeds ofthose customersandresult ina lossof shellegg sales.Similarly,customerswhocommitto stockgreater
proportionalquantities of cage-free eggs are under noobligation to continue to do so, whichmayresult in an oversupply of cage-
freeeggsandresultinlowerspecialtyshelleggprices,whichcouldreducethereturnonourcapitalinvestmentincage-free
production.In addition,on July9, 2025,the DOJfiled alawsuitagainstthe Stateof Californiaalleging thatCalifornia’scage-
free laws“imposeburdensomered tape on theproductionof eggsand poultry productsnationallyin violation ofthe Supremacy
Clause of the U.S.Constitution”and lead to higher egg pricesfor U.S. consumers.Althoughthis lawsuit was dismissedin March
2026,potentialsimilarfuturelitigationcouldfurthercomplicateandthecage-freeegglandscapeandaffectourabilityto
successfullynavigatethese issues.
Changingourinfrastructureandoperatingprocedurestoconformtoconsumerpreferences,customerdemands,lawsand
challenges tothese laws has resulted andwill continue to result inadditionalcosts, including capital andoperating cost increases.
In responseto ourcustomers’announcedgoals andincreasedlegal requirementsforcage-freeeggs, wehaveincreasedcapital
expenditurestoincreaseourcage-freeproductioncapacity.Wearealsoenhancingourfocusoncage-freecapacitywhen
consideringacquisitionopportunities.Ourcustomerstypicallydonotcommittolong-termpurchasesof specificquantitiesor
typeof eggswith us,and asa result,wecannotpredict with anycertaintywhich typesof eggstheywill requireus tosupplyin
future periods.The productionof cage-free eggs is morecostlythanthe production ofconventionalshell eggs,and these higher
productioncosts contributeto the pricesof cage-free eggs,which historicallyhave typicallybeen higherthanconventionalshell
egg prices.Manyconsumers prefer to buy less expensiveconventionalshell eggs. These consumerpreferences, in additionto the
regulatory landscape,mayin turn influenceour customers’futureneeds forcage-free andconventionalshell eggs. Dueto these
uncertainties, we mayover-estimatefuturedemandfor cage-free eggs, which could increase ourcosts unnecessarily,or we may
under-estimatefuturedemandfor cage-free eggs, whichcould harmus competitively.If ourcompetitorsobtain non-cancelable
long-termcontracts to provide cage-free eggs to our existingor potentialcustomers, then theremaybe decreased demandfor our
cage-freeeggsduetotheselostpotentialsales.Ifweandourcompetitorsincreasecage-freeeggproductionandthereisno
commensurateincrease in demand for cage-free eggs, this overproductioncould lead to an oversupply of cage-free eggs, reducing
the salesprice forspecialtyshell eggs andour return oncapitalinvestmentsin cage-free production.
Failuretocomplywithapplicablegovernmentalregulations,includingenvironmentalregulations,couldharmour
operating results,financialcondition,and reputation.Further,we may incur significantcosts to comply withany current
or futureregulations.
Wearesubjecttofederal,stateandlocalregulationsrelatingtograding,processing,packaging,qualitycontrol,distribution,
advertising,labeling, sanitarycontrol, foodsafety,storage, waste disposal,and other areasof our business andmaybe subject to
additionalregulations inthe future.As a fully-integratedshell egg producer,our shellegg facilitiesare subjectto regulationand
inspectionby theUSDA, OSHA,EPAand FDA,as well asstate andlocalhealth andagriculturalagencies,amongothers.Our
shell egg productionand feedmill facilities as well as ourprepared foodsoperationsare subjectto FDA, USDA,EPAand OSHA
regulationandinspections,as applicable.Inaddition,rulesare oftenproposedthat,if adoptedas proposed,could increaseour
costs.
Further,the marketing,labeling andadvertisingof our productsare subjectto extensiveregulation underfederal,state andlocal
laws, including consumerprotection laws. Wemakestatements in our marketing, labeling andadvertising regarding, amongother
things,productattributes,nutritionalcontent,sourcingpractices,animalwelfarestandardsandsustainabilitycharacteristics.
Thesestatementsmaybechallengedasfalse,misleadingor deceptive.Changesin legal orregulatoryrequirements,including
22
withrespecttonutritionfacts,allergendisclosures,servingsizestandards,front-of-packlabeling,ingredientorpackaging
restrictions,or marketing practices,or differingor evolving enforcementpriorities, mayincrease our compliancecosts or require
changes toour products,packagingor marketingpractices. Failure, or
a
perceived failure,to complywith applicableregulations
could subjectus to civilpenalties, injunctions,product relabeling,recalls or withdrawals,loss of necessaryapprovalsor permits,
lossof customersordamagetoourreputation,anyofwhichcouldhaveamaterialadverseeffectonourbusiness,financial
conditionandresults of operations.
Our operationsand facilitiesare subject tovarious federal,state andlocal environmental,health, andsafetylaws and regulations
governing,amongotherthings,thegeneration,storage,handling,use,transportation,disposal,andremediationofhazardous
materials.Under these lawsand regulations,we arerequired to obtainpermits fromgovernmentalauthorities,including,but not
limited towastewaterdischarge permitsandmanureandlitter land applications.
If wefail tocomplywithapplicablelaws orregulations,or failto obtainnecessarypermits,we couldbesubjectto significant
fines andpenalties orother sanctions,our reputationcould be harmed,and our operatingresults andfinancial conditioncould be
materiallyadverselyaffected.In addition,becausetheselawsandregulationsarebecomingincreasinglymorestringent,iti
s
possible thatwe will be required toincur significantcosts forcompliancewith existing andfuturelaws andregulations.
Eventsbeyondourcontrol,suchasextremeweather,naturaldisastersandchangingclimateconditions,andlegalor
regulatoryresponsesmay havea materialadverse impacton our businessand resultsof operations.
Extremeweather events,such asderechos, wildfires,drought, tornadoes,hurricanes,other storms,excessive coldor heat, floods
or other naturaldisasters, as wellas other eventsbeyondour control, suchas bioterrorism,water rights restrictionsand otherfire
events, some of whichhave in the past andinthe future could havea material adverseeffecton our operating results and financial
condition.Such events have,and in thefuture may,amongother things, causeone or moreof the following:impairthe health or
growth of our flocks, decrease productionor availability of feed ingredients, or interfere with our operationsdue to power outages,
fuel shortages,dischargesfrom overtoppedor breachedwastewater treatmentlagoons, damageto our productionand processing
facilities,labor shortagesor disruption oftransportationchannels.
Increasedglobal temperaturesand morefrequentoccurrencesof extremeweathereventsmaycause cropand livestockareas to
become unsuitable,including due to water scarcityor high or unpredictabletemperatures,which may result in much greater stress
onfoodandwater systemsandmorepronouncedfoodinsecurityglobally.Lower globalcropproduction,includingcornand
soybeanmeal, which arethe primaryfeedingredientsthatsupportthe healthof ouranimals,mayresult insignificantlyhigher
prices forthese commodityinputs, impact ourability to source thecommoditieswe use to feed ourflocks, andnegatively impact
ourabilityto maintainor growouroperations.Changingclimateconditionsmayincreasinglyexposeworkersandanimalsto
high heatand humiditystressors that adversely impactpoultry productionand our costs. Increased greenhousegas emissions may
alsonegativelyimpactairquality,soilqualityandwaterquality,whichmayhamperourabilitytosupportouroperations,
particularlyin higher water-andsoil-stressed regions.
Increasingfrequencyof severeweatherevents maynegativelyimpactour ability toraise poultryand produceeggs profitablyor
to operateourtransportationand logisticssupplychains. Thesechangesmaycauseus to change,significantly,ourday-to-day
businessoperationsand ourstrategy.Changing climateconditionsand extremeweathereventsmayalso impact demandfor our
products givenevolution of consumerfood preferences.Even if we takemeasuresto position our business in anticipationof such
changes, compliancewith current and future legal or regulatoryrequirements mayrequire significant managementtime, oversight
and enterpriseexpense.We mayalso incur significantexpensetied to regulatory finesif laws andregulations are interpretedand
appliedina mannerthatis inconsistent withourbusinesspractices.Wecanmakeno assurancesthat oureffortsto preparefor
these adverse eventswillbe in line with future marketand regulatory expectationsand our access to capital to support our business
mayalso be adverselyimpacted.
Currentand future litigationand otherlegal matters couldexpose us to significantliabilities andhave a materialadverse
effecton our businessreputation.
Weandcertainofoursubsidiariesareinvolvedinvariouslegalproceedingsandotherlegalmatters.Litigation,government
investigationsandotherlegalmattersareinherentlyunpredictableandcostly,andalthoughwebelievewehavemeaningful
defensesinthesematters,wemayincurliabilitiesdueto adversejudgmentsor penaltiesorwemayenter intosettlementsof
claims, which couldhave a materialadverse effecton our resultsof operations, cashflow and financial condition.For a discussion
ofourongoinglegalproceedingsseePartI. Item3.LegalProceedingsbelowandPartII.Item8. NotestotheConsolidated
FinancialStatements,
.Suchlawsuits,investigationsandotherlegalmattersare
expensive torespond to anddefend, divert management’sattention, andmay result in significant adversejudgments,penaltiesor
settlements.In addition, legal proceedingsmayexpose us to negativepublicity,all of whichcould have a materialadverse effect
on our business,financialcondition,result of operations,reputationandcustomerpreferencefor our productsandbrands.
23
FINANCIALAND ECONOMICRISK FACTORS
Economicconditions,includinginflationand interest rates,couldnegativelyimpact our business.
Economicconditions,including inflationandinterest rates,mayadverselyaffectour business by:
●
Limiting ouraccessto capitalmarketsor increasing the costof capitalwe mayneed togrow or operateour business;
●
Changing consumerspending and habitsand demand for eggs, particularly higher-priced eggs,as well as prepared foods;
●
Restrictingthe supplyof energysources or increasingourcost toprocure energy;or
●
Reducing the availabilityof feed ingredients, packagingmaterial, andother raw materials, or increasingthe cost of these
items.
Deteriorationof economicconditionscould alsonegativelyimpact:
●
The financialconditionof oursuppliers, which maymakeit more difficultfor themto supplyraw materials;
●
The financialconditionof ourcustomers, whichmaydecrease demandfor eggs andprepared foodsor increase ourbad
debt expense; or
●
Thefinancialconditionof ourinsurers,whichcould increaseourcost toobtaininsurance,and/ormakeit difficultfor
our insurersto meettheir obligations inthe eventwe experience aloss due to aninsured peril.
AccordingtotheU.S.BureauofLaborStatistics,fromJune2021toJune2022,theConsumerPriceIndexforAllUrban
Consumers(“CPI-U”)increased9.1%,thelargest12-monthincreasesincetheperiodendingDecember1981.TheCPI-
U
increased3.3%,2.4% and4.2% annuallyfromMay 2023to May2026.Inflationarycosts have increasedourinput costs,and if
we areunableto passthese coststhrough tothe customerit could havea materialadverseeffecton our business.
Weholdsignificantcashbalancesin depositaccountswithdepositsinexcessofthe amountsinsuredbytheFederalDeposit
InsuranceCorporation(“FDIC”). Inthe event of a bankfailure at an institution where wemaintaindeposits in excess of the FDIC-
insuredamount,we maylose such excessdeposits.
Thelossofanyregisteredtrademarkorotherintellectualpropertycouldenableothercompaniestocompetemore
effectivelywith us.
Weutilizeintellectualpropertyinourbusiness,includingtrademarks,copyrightsandtradesecrets.Forexample,weownthe
trademarks
FarmhouseEggs
®,
4Grain
®,
Sunups
®,
SunnyMeadow®,Van’s®,
and
Crepini®.
Weproduceandmarket
Egg-
Land’sBest
®and
LandO’Lakes
®underlicenseagreementswithEB.Wehaveinvestedasignificantamountof moneyin
establishingand promotingour trademarkedbrands. The loss or expiration of any intellectual propertycould requireus to rebrand
or discontinue affectedproducts, reduce sales volumes, or incur additionalcosts and mayenable our competitors to competemore
effectivelywithus byallowingthemtomakeandsell productssubstantiallysimilartothoseweoffer.Thiscouldnegatively
impactour ability to produce andsell those products, thereby having a materialadverse effecton our business,financial condition
andresults of operations.
Impairmentin the carrying valueof goodwill or other assets couldnegativelyaffect our results ofoperations ornet worth.
Goodwillrepresentstheexcessofthecostof businessacquisitionsoverthefairvalueoftheidentifiablenetassetsacquired.
Goodwillisreviewedatleastannuallyforimpairmentbyassessingqualitativefactorstodeterminewhethertheexistenceof
events orcircumstancesleads toa determinationthat it ismore likelythannot thatthe fairvalue ofa reportingunit isless than
its carrying amount.As of May 30, 2026, we had$97.1 of goodwill.While we believe thecurrent carryingvalue ofthis goodwill
isnot impaired,futuregoodwillimpairmentchargescouldhavea materialadverseeffectonourresultsofoperationsinany
particularperiod andour net worth.
RISK FACTORSRELATINGTO OUR COMMONSTOCK
Provisions of ourcertificate of incorporation,bylaws, and Delawarelaw may makean acquisition of usor a change in our
managementmore difficult.
Certain provisionsof our certificate of incorporationand bylaws could discourage,delay or prevent a merger,acquisitionor other
change incontrol thatstockholdersmayconsider favorable,including transactionsin which an investormight otherwise receive
a premium forits shares.These provisions alsocould limit the pricethat investorsmight be willingto pay in the future forshares
of our CommonStock, thereby depressingthe marketprice of our CommonStock. Stockholderswho wish to participatein these
transactionsmaynot havethe opportunitytodoso.Furthermore,theseprovisionscouldpreventorfrustrateattemptsby our
stockholdersto replaceor removeour management.These provisions:
24
●
providefor thedivisionof theBoardinto threeclassesas nearlyequalin size aspracticablewith staggeredthree-year
terms andlimit the removalof directors andthe filling of vacancies;
●
authorizeourBoard toset the termsof andissue preferredstock, withoutstockholderapproval,that couldbe issuedto
personsfriendlyto managementor could operateas a“poison pill”to dilutethe stockownershipof a potentialhostile
acquirer topreventanacquisitionthatis not approvedby our Board;
●
prohibitstockholderactionby written consent;
●
prohibitstockholdersfromcalling special meetingsof stockholders;
●
establish advancenotice requirements for stockholdernominationsto our Board or for stockholderproposals thatcan be
actedon atstockholdermeetings; and
●
require the approvalof the holders of at least66-2/3% of the voting powerof all then outstandingshares of capital stock
of the Companyentitled to vote generally in the election ofdirectors, votingtogether as a single class,in order to amend
our certificateof incorporationandbylaws.
Inaddition,wearegovernedby theprovisionsofSection203of theDelawareGeneralCorporationLaw,whichmay,unless
certain criteriaare met, prohibitlarge stockholders,in particular those owning15% or more of our outstandingvoting stock, from
mergingor combiningwith us fora prescribedperiod oftime.
The priceof ourCommonStockmaybe affectedby theavailabilityof sharesfor salein the market,andinvestorsmay
experiencesignificant dilutionas a resultof future issuancesof our securities,which couldhave a materialadverse effect
on themarket priceof our CommonStock.
The saleor availabilityfor sale ofsubstantialamountsof our CommonStock couldadverselyimpactthe priceof ourCommon
Stock. OurFourth Amendedand RestatedCertificate of Incorporationauthorizes us to issue 120,000,000shares of our Common
Stockand10,000,000sharesofpreferredstock.AsofJuly22,2026,therewere46,917,080sharesofourCommonStock
outstandingandno sharesof preferredstock outstanding.Accordingly,a substantialnumberof sharesofourCommonStock
remain authorizedfor issuance andcould becomeavailablefor sale in the market.Our Fourth Amendedand RestatedCertificate
of Incorporationauthorizes our Board to set the termsof and issue preferredstock, without stockholderapproval,and such shares
ifissuedcoulddilutethevotingandeconomicinterestsofholdersofCommonStock.Also,wemaybeobligatedtoissue
additionalshares of our CommonStock in connection with employeebenefit plans (includingequity incentiveplans or underour
KSOP).
Inthefuture,wemaydecidetoraisecapitalthroughofferingsofourCommonStock,preferredstock,additionalsecurities
convertibleinto or exchangeablefor our CommonStock or preferredstock, orrights to acquirethose securitiesor ourCommon
Stockor preferredstock. Wemayalso issuesuchsecuritiesas considerationin anacquisition.Theissuanceofsuchsecurities
could resultin dilution of existingstockholders’equity interestsin us. Issuancesof substantial amountsof our CommonStock or
preferred stock, or the perceptionthat such issuancescould occur, mayadversely affectprevailing market prices for our Common
Stock.
The priceof our CommonStock mayfluctuate significantly.
The marketprice of our CommonStock has fluctuatedsignificantly and maycontinue to do so for variousreasonsincluding, but
not limitedto, the following,manyof which arebeyondour control:
●
our quarterlyor annualearnings or thoseof othercompaniesin our industry;
●
the public’sreactionto our press releases,our otherpublic announcementsandour filings withthe SEC;
●
changes inrecommendationsby research analystswho track ourCommonStock or the stock ofother companiesin our
industry,or adecision by suchananalystto reduceor ceasecoverageregarding our CommonStock;
●
changes in general conditions in the U.S. and global economy,financial marketsor ourindustry, including those resulting
fromchangesintradeandtariffpolicies,changesinfuelpricesorfuelshortages,geopoliticalconflicts,incidentsof
terrorism,pandemicsor responses tosuch events;
●
changesinthecompetitivelandscapeforourbusiness,includinganychangesresultingfromindustryconsolidation
whether ornot involvingus;
●
our liquidityposition;
●
futuresales ofour CommonStock;
●
anychangesin our dividend policyor share repurchaseprogram;and
●
other risks,including thosedescribed inthis Risk Factorssection.
Theactualtiming,numberandvalueofsharesrepurchasedunderoursharerepurchaseprogramwillbedeterminedby
managementinitsdiscretion andwilldepend on a numberof factors, including but not limited to,the marketprice of ourCommon
25
Stock andgeneral marketand economicconditions.The sharerepurchaseprogram maybe suspended,modifiedor discontinued
atanytime withoutprior notice.
ITEM 1B.UNRESOLVEDSTAFFCOMMENTS
None.
ITEM 1C.CYBERSECURITY
Risk Managementand Strategy
Weunderstandthe importanceof cybersecurityand itsrole inthe successof theCompany.Our businessoperationsdepend on
the effectiveuse ofour informationsystemsin order toproperlyserve ourcustomers,manageour business andtrack andreport
ourfinancialresults.Ourinformationtechnologyteamconsidersrisksfromcybersecuritythreatsintheimplementationand
executionofourbusinessprocesses.Weconsiderandassesstherisksfromcybersecuritythreatsaspartofouroverallrisk
assessment
process
using the NationalInstituteof StandardsandTechnology(“NIST”) CybersecurityFramework.
In order to identify, assessand manage materialrisksarising from cybersecuritythreats, we maintaininternal resources to monitor
and quicklyrespondto suchthreats. Weperform vulnerabilityscans andpenetrationtesting designedto test the effectivenessof
oursecuritypractices.We
engage
third
-partyserviceproviderstoassistintheevaluationofourinternalcontrolsoverour
informationsystemsthrough auditandconsulting servicestotest thedesignandoperationaleffectivenessof securitycontrols.
Wecontinually monitorour systems to detect andidentify cybersecuritythreats. Prior to contractingwith third-partyvendors,we
perform risk assessmentsof the vendorsand require thevendors to managecybersecurity risks to our businessoperationsas well
asnotifyus ofanypotentialorknowncybersecurityrisks.Wealsorequireouremployeestocompletetrainingprogramsto
increasetheirawarenessof andsensitivitytocybersecuritythreats.Thesetrainingprogramsincludetheidentificationofsuch
threatsandthe properresponsesto apotentialcybersecuritybeachthataligns with our adoptedprocesses.
The Companyhas developeda response process in the event of a cybersecurityincident.The process includesthe cooperation of
the informationtechnologyteamand ourmanagementteamto properlydetectandrespondto theseincidents.These responses
includedeterminationofthepotentialimpactandmaterialityoftheincident,potentialdisclosureandlitigationmatters,and
mitigationofactualorpotentialdamagetooursystemsorreputationarisingfromtheincident.Mitigationmeasuresare
implementedto respond to anypotential cybersecuritybreach in order to continueto effectivelyserve our customersand conduct
ouroperationswithaslittleinterruptionaspracticable.Theinformationtechnologyteamreviewstheresponseprocess
periodicallyto ensurethatit isdesignedto be effectiveandto encompasscurrent or new cybersecuritythreats.
As of July 22, 2026, we are
no
t aware of any risks from cybersecurity threats, including as a result of prior cybersecurityincidents,
thathavematerially affectedor thatwe believeare reasonablylikely tomateriallyaffectthe Company,including ourbusiness
strategy,resultsofoperationsorfinancialcondition.See
forfurtherdiscussionaboutrisksfrom
cybersecuritythreats.
Governance
The Boardis responsiblefor theoversightof management’sprocess for identifyingand mitigatingrisks relatedto cybersecurity
threats.
On a quarterly basis, the Directorof InformationTechnologyprovides a report to the Audit Committeeregarding ongoing
processesto improveand updateour currentcybersecurityprotocols,new cybersecuritythreats,results ofinternalassessments,
and anyrecent cybersecurityincidents.
The
Audit
Committeewill makethe Board awareof anyinformationit deems necessary
or appropriatein order for theBoardto effectivelyoversee theCompany’scybersecurityrisk managementandstrategy.
TheDirectorof InformationTechnologyandtheteamhemanagesareresponsiblefortheoperationandmaintenanceof our
informationsystems, includingthe assessment,identificationand managementof risks from cybersecuritythreats.
Together,the
Directorof InformationTechnologyand histeamhave over150 yearsof experiencein theinformationtechnology andsecurity
environment.Our
Chief Financial Officer
, to whom the Director of InformationTechnology reports, has served as Chief Financial
Officeranda Boardmembersince 2018andhasover 40years ofrisk managementexperience.
26
ITEM 2.PROPERTIES
Our corporateheadquartersislocated in Ridgeland,Mississippi. Weoperatenumerousproduction, manufacturingand processing
facilities,as well as maintainadministrativeoffices throughout 22 states. Webelieve thatall of our facilities arewell maintained
and suitable for current use. Wecontinue to invest in our facilitieswith a focus on expandingcapacityspecifically within prepared
foodsandspecialtyshell eggs as well as regular maintenanceandcost-reductionprojects.
Thetablebelowprovidessummaryinformationabouttheprimaryoperationalfacilities weusein ourbusinessbyreportable
segmentas ofMay30, 2026.Manyofourfacilities areutilized bybothourConventionalShell Egg andSpecialtyShell Egg
segmentsand it is not practical to assign to just onesegment. Therefore,we have identifiedbelow certain of our facilitiesas being
utilized bybothour ConventionalShell Egg and SpecialtyShell Egg segments.
Facility Type
Quantity
(a)
Primary Segment(s)
Capacity
(b)
Breeding Facilities
2
ConventionalandSpecialtyShell Egg
House up to 215,000 hens
Hatcheries
2
ConventionalandSpecialtyShell Egg
Hatchup to712,600chicks per week
Pullet Facilities
38
ConventionalandSpecialtyShell Egg
Houseup to15.5 million pullets
Shell EggProduction
51
ConventionalandSpecialtyShell Egg
Houseup to57.0 million layers
Shell EggProcessingand
Packaging
52
ConventionalandSpecialtyShell Egg
Processes approximately702,600dozen
shell eggs perhour
Feed Mills
29
ConventionalandSpecialtyShell Egg
Productioncapacityof 1,100tons offeed
per hour
Food Manufacturing
5
PreparedFoods
Productioncapacityof 25,700poundsper
hour
(a)
Weownandoperateallof thesefacilities.Thetabledoesnotincludeidledfacilitiesor contractproductionand
growers. Includedin Food Manufacturingis our facility owned by ourmajority-owned joint venture Crepini Foods.
(b)
Capacityis notanindicationofproductionrates.Utilizationofcapacityvaries byfacilitybasedonthelevelof
demandfor productsproducedateachfacility.
As ofMay30,2026,weownedapproximately34.2 thousandacresofland.Therearenomaterialmortgagesor liensonour
properties.
ITEM 3.LEGAL PROCEEDINGS
Refer tothe descriptionof certain legalproceedings underPart II.Item 8.Notes to theConsolidatedFinancialStatements,
, which discussion is incorporatedherein by reference.
ITEM 4.MINE SAFETYDISCLOSURES
Not applicable.
PARTII.
ITEM5.MARKETFORREGISTRANT’SCOMMONEQUITY,RELATEDSTOCKHOLDERMATTERSAND
ISSUERPURCHASESOF EQUITY SECURITIES
OurCommonStocktradesontheNasdaqGlobalSelectMarketunderthesymbol“CALM”.AtJuly 14,2026,therewere
approximately243 record holdersof ourCommonStock and approximately138,539beneficialowners whose shareswere held
by nomineesor broker dealers.
Dividends
TheCompanyhasa variabledividendpolicyadoptedby theBoard. Pursuanttothepolicy,the Companypaysa dividendto
stockholdersof itsCommonStock ona quarterlybasis foreach quarterforwhich theCompanyreports netincomeattributable
toCal-Maine Foods,Inc.computedin accordancewith generallyacceptedaccountingprinciples(“GAAP”)in theU.S.,in an
amountequal to one-third (1/3)ofsuch quarterlynet income.Dividendsarepaidtostockholdersofrecordas ofthe 60thday
following thelast dayof such quarter,except forthe fourth fiscalquarter.For the fourthquarter, theCompanypaysdividends to
stockholdersofrecordon the65thdayafterthe quarterend. Dividendsare payableon the15thdayfollowing therecorddate.
27
Following a quarterfor which theCompanydoes not report net incomeattributableto Cal-MaineFoods,Inc., the Companywill
not paya dividend fora subsequentprofitable quarteruntil the Companyis profitable ona cumulativebasis computedfrom the
dateof thelast quarterfor whicha dividendwaspaid. Inaccordancewith our variabledividendpolicy,we willnot paya cash
dividendtoholdersofourCommonStock withrespecttoourfourthquarterof fiscal2026,andwillnot paya dividendfor a
subsequentprofitable quarteruntil the Companyisprofitableon a cumulativebasis computedfrom the dateof the last quarterin
which a dividend waspaid. At the end of the fourthquarter of fiscal 2026, the amountof cumulative losses to be recovered before
paymentof anyfuturedividendsunder ourvariabledividend policywas $35.9million.
Underthe Company'sCredit Facility,dividendsare restrictedtothe amountpermittedunder theCompany’scurrent dividend
policy,andmaynot bepaidif adefaultexists orwillarise aftergivingeffectto thedividendorifthe sumofcashandcash
equivalentsof theCompanyandits subsidiaries plus availabilityunder theCredit Facility equalsless than$50 million.
Stock PerformanceGraph
TheCompanyutilizedthe(i)Russell2000TotalReturn,and(ii)S&PComposite1500FoodProductsIndustryIndexto
benchmarkthe Company’stotalshareholderreturn. The Companyis a memberof eachof theseindexes andbelieves the other
companiesincluded in theseindexes provideproductsand servicessimilar tothe Company.The graph presentscumulativetotal
shareholderreturn andassumes$100was investedon May28, 2021in the stockor index anddividends were reinvested.
May28, 2021
May27, 2022
June 2, 2023
May31, 2024
May30, 2025
May29, 2026
Cal-Maine Foods,Inc.
$
100.00
$
138.27
$
150.19
$
201.88
$
337.66
$
276.80
Russell2000TotalReturn
100.00
84.13
82.89
95.13
96.26
137.73
S&P Composite1500Food
Products IndustryIndex
100.00
107.14
113.16
103.03
95.52
93.33
28
Issuer Purchasesof EquitySecurities
The followingtableis a summaryof ourfourthquarter2026shares repurchases:
Issuer Purchasesof EquitySecurities
TotalNumber of
MaximumApproximate
SharesPurchased
DollarValueof
TotalNumber
Average
as Partof Publicly
Sharesthat May Yet
of Shares
Price Paid
AnnouncedPlans
Be PurchasedUnder
Period
Purchased
(a)
per Share
or Programs
the Plansor Programs
(b)
3/1/26 to 3/28/26
—
$
—
—
$
—
3/29/26 to 4/25/26
239,936
76.15
239,770
332,583,260
4/26/26 to 5/30/26
156,313
75.85
156,313
320,726,332
396,249
$
76.03
396,083
$
320,726,332
(a)As permittedunder our Amended and Restated 2012 Omnibus Long-Term Incentive Plan, 166 shares were withheldby us tosatisfy taxwithholding
obligationsforan employeein connectionwith thevestingof restrictedcommonstock.
(b)On February25, 2025, the Company announced a $500million share repurchase program. The share repurchase programauthorizes the Company,in
management’s discretion, to repurchase shares of CommonStock from time to time for an aggregatepurchase price up to$500 million (exclusive of any fees,
taxes, commissions or otherexpensesrelatedto such repurchases),subjectto marketconditionsand otherfactors. Theshare repurchaseprogram doesnot obligate
the Company to repurchaseany specificamountof shares, doesnot havean expirationdate, andmay be suspended,modified or discontinuedat any timewithout
prior notice.
RecentSales ofUnregisteredSecurities
No salesof securitieswithout registrationunder theSecuritiesAct of 1933occurred duringour fiscal yearendedMay 30,2026.
ITEM 6.RESERVED
ITEM7.MANAGEMENT’SDISCUSSIONANDANALYSISOFFINANCIALCONDITIONANDRESULTSOF
OPERATIONS
RISK FACTORS;FORWARD-LOOKINGSTATEMENTS
Forinformationrelatingtoimportantrisksanduncertaintiesthatcouldmateriallyadverselyaffectourbusiness,securities,
financialcondition,operatingresults,orcashflow,referenceismadetothedisclosureset forthunder
. Inaddition,becausethefollowing discussionincludesnumerousforward-lookingstatementsrelating toourbusiness,
securities,financial condition,operatingresults andcash flow,reference is madeto the disclosure set forthunder
andtotheinformationset forthinthesectionofPartIimmediatelyprecedingItem1 aboveunderthecaption
“
.”
COMPANYOVERVIEW
Cal-Maine Foods,Inc. (“Cal-MaineFoods,”the“Company,”“we,” “us,”“our”)is thelargestegg companyin theU.S.and a
leadingplayer intheegg-basedfoodindustry,headquarteredin Ridgeland,Mississippi.Witha strongnationalfootprint,Cal-
Maine Foodsprovides nutritious,affordable,and sustainableprotein to millions of householdsevery day.In fiscal 2026, we sold
approximately1.2 billiondozenshelleggs.OurtotalflockasofMay30,2026ofapproximately50.0millionlayersand
14.5 millionpullets andbreeders is thelargest in theU.S.
TheCompany’sshelleggportfoliospansthefulleggvalueladder—fromconventionaltospecialty,includingcage-free,
nutritionallyenhanced,organic,brown,pasture-raisedandfree-rangeeggs—servingbothretailandfoodservicecustomers
nationwide.Cal-MaineFoodsalsoparticipatesinthegrowingpreparedfoodssector,withofferingssuchaspre-cookedegg
patties,omelets,foldedandscrambledeggformats,hard-cookedeggs,pancakes,waffles,andspecialtywraps.Ourbranded
portfolio includesEggland’sBest®,Land O’Lakes®,FarmhouseEggs®,4Grain®,Sunups®,Van’s®, MeadowCreekFoods®,
andCrepini®.
We sellour products to a diverse groupof customers, includingnationaland regional grocery store chains, club stores,companies
servicing independentsupermarketsin theU.S.,and foodservicedistributorsserving restaurants,conveniencestores,healthcare
29
and educationfacilities, andhotelsthroughoutthe majorityof theU.S. andaim tomaintainefficient,state-of-the-artoperations
locatedclose to our customers.
Ourstrategyincludesthreeprimarypriorities:expandingspecialtyshell eggsandpreparedfoods,pursuing disciplinedgrowth
through acquisitionsand leveragingour scale, verticalintegration,operationalexcellence and financialstrength.Throughoutour
history, wehave acquiredother businesses in our industry. Since1989, we have acquiredand integrated28 businesses, and within
the last2 fiscalyears, wehave madevarious acquisitionsaimedat furtheringourgrowth strategy.For furtherdiscussionofour
acquisitions,refer to
Our fiscal year end isthe Saturdayclosest to May 31. The fiscal years2026, 2025 and2024 each included 52 weeks. Allreferences
herein toa fiscalyearmeansour fiscal yearandall references toa yearmeana calendaryear.
Our operating results are materiallyimpactedby marketprices foreggs and feed grains (corn and soybeanmeal), whichare highly
volatile, independentof each other, andout of our control. Generally,higher marketprices for eggs havea positive impacton our
financial resultswhile highermarketprices forfeed grainshave anegative impacton our financialresults. Ourpricing forshell
eggsisnegotiatedwithourcustomersonindividualterms.Wesellourshell eggsatpricesbasedonformulasthattakeinto
account,invarying ways, one of the independentlyquoted regional wholesale market prices for shell eggs, our costs of production,
such as grain-based andvariationsof cost-plus arrangements, or hybrid models including cost of productionand wholesale market
prices.
Almostallofourconventionalshelleggsarepricedandsoldundermarket-basedpricing frameworksorthehybridmodels
described above,split almost evenly between such frameworks.The majorityof our specialty shell eggs arepriced and sold under
frameworksthat are basedon cost of production, althoughwe do havesome customersthat prefer market-based pricing forcage-
freeeggs. Asa result,specialtyshell eggpricestypically donot fluctuateas muchas conventionalshell egg prices.Wedo not
sell eggsdirectly toconsumersor set theprices at which eggsare sold toconsumers.
Retail sales ofshell eggs historicallyhave beenhighest duringthe fall and wintermonthsand lowest duringthe summermonths.
Prices forshell eggsfluctuatein response toseasonaldemandfactors anda naturalincrease inegg productionduring thespring
and earlysummer.Historically,shell eggprices tendto increasewith thestart of theschoolyear andtendto be highestpriorto
holidayperiods,particularlyThanksgiving,ChristmasandEaster.Asaresult,wehavehistoricallyexperienced,andmay
experiencein thefuture,lower shellegg sellingprices,salesvolumesandshell eggsales (andhaveincurred, andmayincur in
the future, netlosses)in our firstand fourthfiscal quartersending in August/Septemberand May/June,respectively.Becauseof
the seasonaland quarterlyfluctuations,comparisonsof our sales andoperatingresults between differentquarterswithin a single
fiscal yearare notnecessarily meaningfulcomparisons.
Ourindustryhasbeen greatlyimpactedby severaloutbreaksof HPAIin recentyears.Following theHPAIoutbreaksin 2015,
there were noreportedsignificant outbreaksof HPAIin the commercialtableegg layer flocksuntil Februarythrough December
2022.Thereafter,therewere no HPAIcases affectingcommerciallayersuntil November2023.Since 2023,outbreaksof HPAI
have continuedto occur inU.S. poultry flocks.In 2024 and2025, 40.2 million and 45.2 million commercial layer hensand pullets
weredepopulateddue toHPAI,respectively.Todatein 2026,through July20,2026,19.2million layerhens andpullets have
been depopulateddue toHPAI.
An importantcompetitiveadvantagefor Cal-Maine Foodsis our ability tomeetour customers’evolving needswitha favorable
mix ofbrandedandprivate-label productsof conventionalandspecialtyshell eggs,includingcage-free, nutritionallyenhanced,
organic,brown, pasture-raised andfree-range eggs,as well aspreparedfoodsandegg products.
For furtherdescription ofour business,refer to
TheCompanypreviously operatedas oneoperatingandone reportablesegment. Effectivein thefourthquarterof fiscal2026,
the Companydetermined its operationsare organizedinto three reportableoperatingsegments:(1) ConventionalShell Eggs;(2)
SpecialtyShell Eggs; and (3) Prepared Foods.As we have expandedour prepared foods productofferings throughoutfiscal 2026,
theseoperatingsegmentsalignwithhowtheCompany’smanagementreviews operatingresultsandmakesdecisionsabout
resourceallocationand strategicinitiatives. Allpriorfiscal year periodshave beenrecast toreflectthe new reportablesegments.
For furtherinformationon ourreportable segments,see
in PartII. Item8. Notesto Consolidated
FinancialStatements.
EXECUTIVEOVERVIEW
For fiscal2026, werecognizednet salesof $2.9billion andnet incomeof $316.7million.Werecorded agross profitof $672.0
million comparedto $1.9 billionfor fiscal2025. Thedecrease wasa resultof a decreasein the netaverageselling priceofshell
eggs, primarilyconventionalshell egg prices, partiallyoffsetby anexpansionof ourPreparedFoods segment.
30
Ouraverageconventionalshell egg priceper dozenforfiscal 2026declined50.9% comparedto fiscal 2025.Averagespecialty
shell egg priceper dozen declined9.5% comparedto fiscal year 2025. Eggprices declinedwith therepopulationof the egg layer
flock during fiscal2026. According to the USDA, the sizeof the layer hen flock was 312.0 millionhens at July 1, 2026, compared
to the five-yearaverageof 308.0 million hens.AmericanEgg Board estimatesthe U.S.laying flock
as
of May2026 at 340–347
millionhens,basedonproducerassessmentdatacollectedacrossthecommercialeggindustry,materiallyaboveUSDA’s
published estimateandindicativeof abundantegg supplies.
In fiscal 2026, preparedfoods accountedfor $244.8 million or 8.4% of our net sales. Prepared food sales forfiscal 2026 increased
$240.8million, comparedto fiscal 2025,primarily dueto our acquisitionof EchoLakeFoods in thefirst quarterof fiscal2026.
Wholesaleshell eggpricesarevolatile,cyclical,andimpactedby anumberoffactors,includingconsumerdemand,seasonal
fluctuations,thenumberandproductivityoflayinghensintheU.S.,outbreaksof agriculturaldiseasessuchas HPAI,severe
weatherpatternsandretailers go-to-marketstrategiesandhow theymanagetheir inventories.Webelieve therecentdecline in
wholesaleegg pricesprimarilyreflectsimprovedeggsupply,followingdisruptionsassociatedwith HPAIinfiscalyear2025.
Comparedto the prior fiscalyear,panic-driven purchasingactivity appearsto have subsided,and improvedpipeline availability
relativeto thepriorfiscal yearappearsto havereducedthe needfor acceleratedpurchasingor inventorybuilds byretailersand
foodserviceoperators.Asa result,wholesaleshelleggpriceshavedeclined,whileretailshelleggpriceshaveadjustedmore
gradually.
RESULTSOF OPERATIONS
CONSOLIDATEDRESULTS
Fiscal YearEnded
2026 Comparedto
2025 Comparedto
May30, 2026
May31, 2025
June 1, 2024
2025% Change
2024% Change
Net sales
$
2,911,632
$
4,261,885
$
2,326,443
(31.7)
%
83.2
%
Operatingincome
350,186
1,536,539
312,452
(77.2)
391.8
Totalother income
60,818
66,603
47,519
(8.7)
40.2
Incometaxexpense
92,892
384,910
83,689
(75.9)
359.9
Less:Net income(loss) attributable
to noncontrollinginterest
1,430
(1,816)
(1,606)
(178.7)
13.1
Net incomeattributableto
Cal-Maine Foods,Inc.
$
316,682
$
1,220,048
$
277,888
(74.0)
%
339.0
%
Net Sales
Net salesfor fiscal year2026 was$2.9 billioncomparedto $4.3billion infiscal2025,a decreaseof $1.3billion or31.7%.The
decreasewas primarilydue tothe decreaseinprices for conventionalshell egg,as thelayerpopulationrecoveredin 2025fro
m
the recentHPAIoutbreaks,partiallyoffsetby sales growthdue toacquisitionsmadeduring fiscal2026, particularlyEcho Lake
Foods.For furtherdiscussion, referto “SegmentResults” within thissection.
Net salesfor fiscal year2025 were $4.3billion comparedto $2.3 billion in fiscal2024, an increaseof $1.9 billionor 83.2%.The
increase wasprimarilydueto theincrease inpricesfor conventionalshell eggsdueto a resurgenceof HPAIoutbreaksin 2024
and2025,which decreasedsupply.
For moreinformationregarding the HPAIoutbreaks,refer to
.
OperatingIncome
For fiscal 2026, operatingincome was $350.2 millioncomparedto $1.5 billionin fiscal 2025, a decreaseof $1.2 billion, or 77.2%.
Thedecreasewasprimarilyduetoa decreaseinpricesforconventionalshell egg,partiallyoffsetbyadecreaseinpriceand
volumeof outsideegg purchases. For furtherdiscussion, referto “SegmentResults” within thissection.
31
Operating income was $1.5 billionin fiscal 2025 comparedto $312.5 millionin fiscal 2024, an increaseof $1.2 billion,or 391.8%.
The increasewas primarilydue to higher net averageselling prices,particularlyfor conventionalshell eggs, and highershell egg
volumes,as well aslower feedingredient prices,partiallyoffsetby anincrease in volumeandprice of outsideegg purchases.
For more informationregarding shell egg andfeed prices, referto
Other Income(Expense)
Totalotherincome(expense)consistsofitemsnotdirectlychargedto,orrelatedto,operationssuchasinterestincomeand
expense,equity inincomeor lossof unconsolidatedentities, andpatronagedividends, amongother items. Patronagedividends
are paidto us fromour membershipin the EB cooperative.
Werecorded interestincomeof $46.7million infiscal2026, comparedto $48.7million infiscal2025,primarilydue to slightly
lower cash andcash equivalentsand investmentsecuritiesavailable-for-sale balancesas the Companyused these investmentsfor
acquisitionsthroughoutfiscal 2026.We recordedinterest expenseof $556thousandand $612thousandinfiscal 2026and 2025,
respectively,primarilyrelatedto commitmentfees underour Credit Facility describedbelow.
Werecorded interestincomeof $48.7 millionin fiscal 2025,an increaseof $16.4million comparedto fiscal 2024, primarilydue
to significantlyhighercashandcashequivalentsand investmentsecurities available-for-sale balancesand yields. Werecorded
interestexpenseof $612thousandin fiscal 2025primarily relatedto commitmentfees underour Credit Facility.
IncomeTaxes
For fiscal 2026,our pre-tax incomewas $411.0 million, comparedto $1.6 billionfor fiscal 2025.Werecognizeda tax provision
of $92.9million forfiscal2026 comparedto $384.9millionin fiscal2025.Forfiscal 2026,the primarydifferencebetweenthe
U.S.statutoryrateof21%andtheeffectiverateof22.6%wasrelatedtostateincometaxes.Forfiscal2025,theprimary
differencesbetweenthe U.S.statutoryrate of 21%and theeffectivetax rateof 24.0%relatedto stateincometaxes, federaltax
credits, andcertain non-taxable and non-deductibleitems. Forfiscal 2024, incometax expensewas $83.7 millionwith an effective
taxrate of23.2%.
Itemscausingoureffectivetaxrate todifferfromthefederalstatutoryincometaxrate of21% arestateincometaxes,certain
federaltaxcredits andcertainitems includedin incomeor lossfor financialreportingpurposesthatare notincluded intaxable
incomeor lossfor incometaxpurposes, includingtaxexemptinterest income,certainnondeductibleexpenses,andnet income
or lossattributableto noncontrollinginterest.
Net income(loss) attributableto noncontrollinginterest
Net incomeattributableto noncontrollinginterestwas$1.4million forfiscal2026 comparedto anet lossof $1.8million and a
net loss $1.6 million for fiscal 2025 andfiscal 2024, respectively. The increase in net income attributableto noncontrolling interest
for fiscal 2026as comparedto fiscal 2025was dueto increasesales volumeof ourCrepini Foods of406%.
Net IncomeAttributableto Cal-Maine Foods,Inc.
Net incomeattributableto Cal-Maine Foods,Inc.for fiscal2026was$316.7million,or $6.65per basicand$6.63per diluted
share, comparedto $1.2billion,or $25.04per basic and$24.95per diluted sharefor fiscal 2025.
Net incomeattributableto Cal-Maine Foods,Inc.forfiscal2024was $277.9million,or$5.70per basicand$5.69per diluted
share.
32
SEGMENTRESULTS
ConventionalShell Eggs
Fiscal YearEnded
2026Comparedto
2025Comparedto
May30, 2026
May31, 2025
June 1, 2024
2025% Change
2024% Change
Net sales
$
1,348,076
$
2,755,859
$
1,247,292
(51.1)
%
120.9
%
Cost ofsales
1,059,179
1,393,212
970,031
(24.0)
%
43.6
Selling, generalandadministrative
72,256
72,644
63,560
(0.5)
%
14.3
Segment income
$
216,641
$
1,290,003
$
213,701
(83.2)
%
503.6
%
Fiscal 2026comparedto fiscal 2025
-
Net salesdecreased$1.4 billion,or 51.1%comparedto fiscal 2025,primarilydue toa decreaseof 50.9%in pricesfor
conventionalshelleggs,resultingina$1.4billiondecreaseinnetsales.Volumesforconventionalshelleggswere
relativelyflatcomparedto fiscal 2025.
-
Cost of sales decreased$334.0 million, or24.0% comparedto fiscal 2025, primarily dueto a 23.8% decreasein the cost
per dozensold as totalvolume soldwas relatively flat.Cost per dozensold decreasedprimarilydue to a decreasein the
price andvolumeof outsideegg purchasescomparedto theprior fiscal year.
Fiscal 2025comparedto fiscal 2024
-
Net sales increased$1.5 billion, or120.9% in fiscal 2025comparedto fiscal 2024primarily dueto an increase of99.7
%
inpricesforconventionalshell eggs,whichresultedina$1.4billionincreaseinnetsales,anda 10.6%increasein
volumeof conventionaldozenssold, which resulted in a $132.5 million increase in net sales.
-
Cost of sales increased$423.2 million,or 43.6% infiscal 2025comparedto fiscal 2024, primarily due a 29.8%increase
in thecost per dozensold as wellas an increaseof 10.6%in sales volume.Cost per dozensold increasedprimarilydue
to the increasein theaverageprice and volumeof outside eggpurchases, whichwas partiallyoffsetby a 5.6% decrease
in productioncost primarily drivenby lower feedingredient pricesas ourproductionincreased9.1%.
-
Selling,general, andadministrativeexpensesincreased$9.1 million,or 14.3%in fiscal2025 comparedto fiscal 2024,
primarily due to increaseddelivery and employeerelated costs. The increase in delivery costs relatedto a 10.6% increase
in volume of conventionalshell eggs sold due to our acquisition of ISE America,Inc. (“ISE”) andour facilities in Chase,
KS and Farwell, TX returningto full operationsin fiscal 2025 followingHPAIoutbreaksinthe third and fourthquarters
offiscal2024.Employeerelatedcostsincreasedduetoanincreaseinbonusescomparedtofiscal2025.Formore
informationregarding our acquisitions,refer to
in Part II. Item 8. Notesto ConsolidatedFinancial
Statements.For more informationregarding HPAI,refer to
.
SpecialtyShell Eggs
Fiscal YearEnded
2026Comparedto
2025Comparedto
May30, 2026
May31, 2025
June 1, 2024
2025% Change
2024% Change
Net sales
$
1,070,458
$
1,154,951
$
873,619
(7.3)
%
32.2
%
Cost ofsales
777,920
717,411
648,236
8.4
%
10.7
Selling, generalandadministrative
110,994
103,938
89,188
6.8
%
16.5
Segment income
$
181,544
$
333,602
$
136,195
(45.6)
%
144.9
%
Fiscal 2026comparedto fiscal 2025
-
Net salesdecreased$84.5million,or7.3%comparedto fiscal2025, primarilydue toadecreaseof 9.5%in pricesof
specialtyshell eggs,resulting ina $112.6million decreasein netsales, partiallyoffsetby a2.4% increasein specialty
dozenssold, resulting ina $28.1million increasein net sales.
33
-
Cost of sales increased$60.5million, or 8.4%comparedto fiscal 2025, primarilydue toa 5.9% increasein the cost per
dozen soldas well as anincrease of2.4% in salesvolume.Cost per dozensold increasedas ourspecialty shellegg mix
shiftedto higher costspecialtytypes.
-
Selling, general,and administrativeexpenses increased$7.1 million,or 6.8% comparedto fiscal 2025, primarilydue to
a$4.7millionincreaseinfranchisefees.Infiscal2025,thehigherpricesforconventionalshelleggscomparedto
specialty shelleggs diminished theneed to promote specialtyshell eggs, duringwhich time,EB temporarily reducedthe
relatedfranchisefeesforcertainspecialtyshellegg brandsto encouragecontinuedproductionof thesebrandedeggs.
Additionally,delivery chargesincreased$2.3 million asspecialtydozens soldincreased 2.4%comparedto fiscal 2025.
Fiscal 2025comparedto fiscal 2024
-
Netsalesincreased$281.3million,or 32.2%infiscal2025comparedto fiscal2024primarilyduetoanincreaseof
20.7%in volume of specialty shell eggs sold,which resulted in a $180.9million increase in net sales, and a 9.5% increase
in pricesof specialtyshell eggs, whichresulted in a$100.5million increase in netsales.
-
Cost of sales increased $69.2million, or 10.7% in fiscal 2025comparedto fiscal 2024, primarily due to a 20.7% increase
in sales volume,partially offsetby an 8.3% decreasein the cost per dozen sold.Cost per dozensold decreasedprimarily
due to a 8.3%decrease in our productioncosts primarilydriven by lowerfeed ingredientprices infiscal 2025compared
to fiscal 2024.
-
Selling,general, andadministrativeexpenses increased$14.8 million,or 16.5%in fiscal 2025 comparedto fiscal 2024,
primarilydue toan$11.1million increase in delivery expenseresulting fromhigher contracttrucking expenses.
PreparedFoods
Fiscal YearEnded
2026Comparedto
2025Comparedto
May30, 2026
May31, 2025
June 1, 2024
2025% Change
2024% Change
Net sales
$
244,802
$
4,050
$
—
5,944.5
%
100.0
%
Cost ofsales
185,370
4,511
—
4,009.3
100.0
Selling, generalandadministrative
25,550
1,658
—
1,441.0
100.0
Segment income
$
33,882
$
(2,119)
$
—
(1,699.0)
%
100.0
%
Fiscal 2026comparedto fiscal 2025
-
Net salesincreased$240.8 million,comparedto fiscal 2025,primarilydue tothe significantexpansionof ourprepared
foods segment followingour acquisitionof Echo Lake Foods.For more informationregarding ouracquisitions,refer to
in PartII. Item8. Notes to ConsolidatedFinancialStatements.
-
Cost of sales increased$180.8 million comparedto fiscal 2025, primarily due to increasedproductionresulting from the
acquisitionof EchoLakeFoods.
-
Selling,general,andadministrativeexpensesincreased$24.1million,comparedtofiscal2025,primarilydueto
increasedemployeecosts anddelivery chargesresulting fromthe acquisitionof EchoLakeFoods.
34
Fiscal 2025comparedto fiscal 2024
-
Net salesincreased$4.1million infiscal 2025comparedto fiscal 2024due tothe acquisitionofCrepini duringfiscal
2025.Formoreinformationregardingouracquisitions,referto
inPartII.Item8.Notesto
ConsolidatedFinancialStatements.
-
Cost ofsales increased$4.5 million in fiscal2025comparedto fiscal 2024due tothe acquisitionof Crepini.
-
Sales,general,andadministrativeexpensesincreased$1.7millioninfiscal2025comparedto fiscal2024duetothe
acquisitionof Crepini.
UnallocatedIncome(Expenses)
Fiscal YearEnded
2026Comparedto
2025Comparedto
May30, 2026
May31, 2025
June 1, 2024
2025% Change
2024% Change
Other - segmentincome
$
19,044
$
42,091
$
33,566
(54.8)
%
25.4
%
UnallocatedcorporateSG&A(a)
(108,353)
(127,141)
(94,516)
(14.8)
34.5
Gain (loss)on involuntary
conversions
8,819
(156)
23,532
(5,753.2)
(100.7)
Gain (loss)on disposalof fixed
assets
(1,391)
259
(26)
(637.1)
(1,096.2)
(a)
UnallocatedcorporateSG&Aprimarilyconsistsof unallocatedcorporateoverheadcosts, administrativeexpenses,and
amortizationthatare notdirectly relatedor allocatedto theoperatingsegments.
Fiscal 2026comparedto fiscal 2025
-
Other –segmentincomedecreased$23.0 million,or 54.8%comparedto fiscal 2025, primarilydue to
a
decrease inthe
averageselling price ofour co-packegg sales as well as liquid andfrozenegg products.
-
UnallocatedcorporateSG&Adecreased$18.8million, or14.8%, comparedto fiscal 2025,primarilydue toa decrease
inthe accrualforemployeebonusescomparedto thepriorfiscalyearaswellas a$15.0millionadjustmentin fiscal
2025tothefairvalueofcontingentconsiderationassociatedwiththe FassioEggFarms,Inc.(“Fassio”)acquisition.
Thesewerepartiallyoffsetbyadditionalamortizationof intangiblesthatwereacquiredfromouracquisitionsduring
fiscal 2026.For moreinformationregarding our acquisitions,refer to
in PartII. Item 8. Notesto
ConsolidatedFinancialStatements.
-
In fiscal2026,we recognized$8.8million ofgains frominvoluntaryconversions,primarilydrivenby a$7.5million
gain recordedin the first quarterrelated to businessinterruptioninsurancerecoveriesassociatedwith a weather-related
eventthatoccurred in fiscal 2021.
Fiscal 2025comparedto fiscal 2024
-
Other –segmentincomeincreased$8.5 million,or 25.4%in fiscal2025comparedto fiscal 2024primarilydue toan
increasein volumeof liquideggproductssold, primarilyrelatedtothe acquisitionof ISE,whichincludeda breaking
facility.
-
UnallocatedcorporateSG&Aincreased $32.6 millionor 34.5% comparedto fiscal 2024, primarilydue employee related
costs whichincreaseddue toan increasein employeebonusesand a $15.0million adjustmentinfiscal 2025compared
to a $5.5 millionadjustmentto increase the fair value of contingentconsiderationassociatedwith the Fassio acquisition
andincreasedprofessionalfees mainlyassociatedwith $6.6 milliontransactioncosts recordedin thefourthquarter of
fiscal2025 forEcho LakeFoods acquisition.These werepartiallyoffsetby a$19.6 millionreductionin litigationloss
contingencyaccrual.
-
Infiscal2025,lossoninvoluntaryconversionwas$156thousandcomparedto
a
$23.5million gainoninvoluntary
conversionin fiscal 2024. The decrease of $23.7million wasprimarily dueto recoveries infiscal 2024under indemnity
andinsuranceprogramsthatexceededthe amortizedbookvalueof thecoveredassetsandourdirect costs,primarily
relatedto theHPAIoutbreakatour KansasandTexasfacilities thatoccurred in fiscal2024.
35
LIQUIDITYAND CAPITALRESOURCES
We aim to maintaina strong balance sheet and liquidity, particularlygiven the cyclical natureof our business. We believe astrong
balancesheet supports our growthopportunitiesand stockholderreturns. Our prioritiesfor theuse of cash inrecent periodshave
included the paymentof dividends pursuantto our variable dividend policy,inorganic growththrough acquisitionsof businesses,
organicgrowthincludingconstructionandconversionofcage-freefacilitiesandinvestmentinvalue-addedproducts,and
maintenancecapitalexpenditures.
WorkingCapitalandCurrent Ratio
OurworkingcapitalatMay30, 2026was $1.4billion,comparedto $1.7billionatMay31, 2025.Thecalculationofworking
capital isdefined ascurrent assetsless current liabilities.Our currentratio was7.7 at May30, 2026comparedto 6.4 atMay 31,
2025. The currentratio is calculatedby dividing current assetsby current liabilities.The increasein our currentratio is primarily
dueto thedecreaseintotalcurrentliabilities,specificallydividendspayable,which decreasedby $114.1millioncomparedto
May31,2025.Duetoseasonalfactorsdescribedin
, wegenerallyexpectourneedfor
workingcapitalto be highest in thefourthandfirst fiscal quartersending in May/June andAugust/September,respectively.
CashFlows fromOperating Activities
Netcashprovidedbyoperatingactivitieswas$479.8millionforfiscal2026,comparedto$1.2billionforfiscal2025.The
decrease incash flow fromoperating activitiesresulted primarilyfrom lowernet averageegg sales prices perdozen,particularly
for conventionalshell eggs, partially offsetby the increasein volume andhigher price of outsideegg purchasesin the prior fiscal
year.
CashFlows Used in InvestingActivities
For fiscal 2026, $503.8million was used in investing activities, primarily due to the acquisitionof assets of Echo Lake, Creighton,
andotherbusinessesaswellassalesandmaturitiesofinvestmentsecuritiescomparedto$575.5million usedininvesting
activitiesin fiscal 2025,primarilydue topurchasesof investmentsecurities,purchasesof property,plant andequipmentand the
acquisitionof assetsof ISE.Purchasesof investmentsecuritieswere$648.9million infiscal2026comparedto $1.2billion in
fiscal2025.Sales andmaturitiesofinvestmentsecuritieswere$745.2millioninfiscal2026,comparedto $907.6millionfor
fiscal2025.Cashpaidforbusinessacquisitionswas$427.8millioninfiscal2026,primarilyrelatedtotheEchoLakeand
Creightonacquisitions,and$116.2millioninfiscal2025,relatedtotheISEacquisition.Purchasesofproperty,plantand
equipmentwere$151.2million and$161.3millionin fiscal2026and2025, respectively,primarilyreflectingprogressonour
constructionprojects.
CashFlows Used in FinancingActivities
Wepaiddividendstotaling$231.6millionand$330.3millioninfiscal2026and2025, respectively.Werepurchased$131.1
million in shares of CommonStock in fiscal 2026, comparedto $54.0 million in fiscal 2025, primarily under ourshare repurchase
program.See “ShareRepurchaseProgram,” below.
Increase(decrease)in CashandCashEquivalents
As ofMay30,2026, cashandcashequivalentsdecreased$386.9millionsinceMay31,2025, comparedto
a
$262.5million
increaseduringfiscal2025. Thedecreaseis primarilyduetothe acquisitionsofEchoLakeFoods,CreightonBrothers,LLC,
CleanEgg, LLC,and Van’sFoods, totaling$452.6 million.Refer toPart II.Item 8. Notesto theFinancialStatements,
for furtherinformationregarding our recentacquisitions.
Credit Facility
OnNovember15,2021,weenteredintoanAmendedandRestatedCredit Agreement(asamended,the “CreditAgreement”),
expiring November21, 2026. The Credit Agreementprovides fora senior securedrevolving credit facility (the“Credit Facility”),
up to $250 million.As of May 30,2026, no amountswere borrowed underthe Credit Facility.As of May 30,2026, we had$5.9
million inoutstandingstandbyletters of credit,which wereissued underourCredit Facilityfor thebenefitof certaininsurance
companies.Refer to Part II. Item 8. Notesto the Financial Statements,
for further informationregarding
our long-termdebt.
36
Share RepurchaseProgram
In February2025,the Company’sBoardof Directors (“Board”)approveda $500million share repurchaseprogram.The share
repurchaseprogramauthorizes theCompany,in management’sdiscretion, to repurchaseshares of ourcommonstock fromtime
to time foran aggregatepurchaseprice upto $500million(exclusive ofany fees,taxes,commissionsor otherexpensesrelated
to suchrepurchases),subject tomarketconditionsand otherfactors. Theactualtiming, numberand valueof sharesrepurchased
under the programwill be determinedby managementinits discretion andwill dependon a number of factors,including, but not
limitedto,themarketpriceofourcommonstockandgeneralmarketandeconomicconditions.TheCompanyrepurchased
1,571,950and 551,876shares during fiscal 2026and 2025,respectively,under the program.As of the end of fiscal2026, we had
remaining authorizationto purchaseup to$320.7million under the repurchaseprogram.
The Companyexpects to strategicallyandopportunisticallyrepurchaseshares fromtime to timethrough solicited or unsolicited
transactionsin the openmarket,in privatelynegotiatedtransactionsor by othermeansin accordancewith securities laws.The
Companyexpects that sharerepurchasesunder the program will be fundedfrom existing cash balancesand futurefree cash flow.
Thesharerepurchaseprogramdoes notobligatetheCompanyto repurchaseanyspecific amountof shares,doesnot havean
expirationdate,andmaybe suspended,modifiedor discontinuedatanytimewithoutprior notice.See
andPart II.Item8. Notes to theFinancialStatements,
for furtherinformation.
Dividends
In accordancewith our variabledividend policy,wewill notpay a cashdividendto holdersof ourCommonStock withrespect
to our fourthquarter of fiscal2026. The Companywillnot paya dividend fora subsequentprofitable quarteruntil the Company
is profitableon acumulativebasiscomputedfromthe dateof thelast quarterin whichadividend waspaid.At theendof the
fourth quarterof fiscal2026, theamountof cumulativelosses to be recoveredbeforepaymentof adividend was$35.9 million.
MaterialCashRequirements
Materialcashrequirementsfor operatingactivitiesprimarilyconsistof feedingredients,processing,packagingandwarehouse
costs,employeerelatedcosts,maintenancecapitalexpendituresandothergeneraloperatingexpenses.Ourmaterialcash
requirementsfor growth capitalexpenditures consistprimarilyof our constructionprojects to increaseour productioncapacity of
prepared foodsand cage-free shell egg production. Webelieve our currentcash balances,investments,projectedcash flows from
operations,andavailableborrowings underourCredit Facilitywill besufficientto fundourcashneeds foratleast thenext12
monthsand to fund our capital commitmentscurrently inplace thereafter.Future acquisitions of businesses mayrequire additional
financing.
IMPACTOF RECENTLYISSUED ACCOUNTINGSTANDARDS
For informationon changesin accountingprinciplesand new accountingprinciples, see“
New AccountingPronouncementsand
Policies
” in Part II. Item8. Notes to ConsolidatedFinancialStatements,
.
CRITICALACCOUNTINGESTIMATES
The preparationof financial statementsinaccordancewithU.S. GAAP requiresmanagementto make estimatesand assumptions
that affectthe reported amounts of assets and liabilities at the date of the financial statements and the reported amounts ofrevenues
and expensesduring the reporting period. Actual results could differmaterially fromthese estimates. Critical accountingestimates
are those estimatesmadein accordancewithGAAP thatinvolve a significantlevel of estimationuncertaintyand havehad or are
reasonablylikely tohave a materialimpacton thefinancialconditionor results of operations.Our critical accountingestimates
are describedbelow.
BusinessCombinations
The Companyapplies the acquisitionmethodof accounting,which requiresthat oncecontrol is obtained,all theassets acquired
and liabilitiesassumed,includingamountsattributableto noncontrollinginterests,are recordedattheir respectivefair valuesat
thedateof acquisition.Theexcessofthepurchasepriceoverfairvaluesofidentifiableassetsandliabilities isrecordedas
goodwill.
Weusevariousmodelsandmethodstodeterminethefairvaluesofidentifiableassetsandliabilities,suchastop-downand
bottom-upapproachfor inventory,cost methodandmarketapproachfor property,relief-from-royaltyandmulti-periodexcess
37
earnings tovalue intangibles.Significantestimatesin valuingcertain intangibleassets include,but are not limitedto, the amount
andtiming of futurecashflows, growth rates, discountrates anduseful lives.
Thefairvaluesofidentifiableassetsandliabilitiesaregenerallydeterminedinternallyandrequiresestimatesandtheuseof
variousvaluationtechniques.Whena marketvalueisnot readilyavailable,ourinternalvaluationmethodologyconsidersthe
remainingestimatedlife ofthe assetsacquiredandsignificantjudgmentis requiredas managementdeterminesthe fairmarket
valuefor thoseassets.
Duetoinherentindustryuncertaintiesincludingvolatileeggpricesandfeedcosts,unanticipatedmarketchanges,events,or
circumstancesmayoccur thatcould affectthe estimatesandassumptionsused,which could result in subsequentimpairments.
Inventories
Inventoriesof eggs,feed, suppliesand flocksare valuedprincipallyat the lowerofcost or netrealizablevalue. Ifmarketprices
foreggsandfeedgrains movesubstantiallylower,werecordadjustmentsto writedownthecarryingvaluesof eggsandfeed
inventories tofair marketvalue. The cost associatedwith flock inventories,consisting principallyof chick purchasesor hatching
costs,feed,labor,contractorpaymentsandoverheadcosts,areaccumulatedduringthehatchingandgrowingperiodsof
approximately22weeks. Capitalizedflockcostsarethenamortizedovertheflock’sproductivelife,generallyonetotwo
years. Judgmentexists indeterminingthe flock’sproductivelife includingfactorssuch aslaying rateand eggsize, moltcycles,
and customerdemand.Furthermore,other factorssuch as hentypeor weatherconditionscould affectthe productivelife. These
factorscould makeour estimates of productivelifediffermaterially fromactual results. Flock mortalityis charged to cost of sales
asincurred. Highmortalityfromdiseaseorextremetemperatureswillresultinabnormalwrite-downstoflock
inventories.Managementcontinuallymonitorseachflockandattemptstotakeappropriateactionstominimizetheriskof
mortalityloss.
Goodwill
As a resultof acquiringbusinesses,the Companyhad $97.1million of goodwillas ofMay 30,2026, representing3.1%of total
assetsand3.7%ofstockholders’equity.Goodwillisevaluatedforimpairmentannually(ormorefrequentlyifimpairment
indicatorsarise) by first performinga qualitativeassessmentto determine whether a quantitativegoodwilltest is necessary.After
assessingthe totalityof eventsor circumstances,if wedetermineit ismore likelythannot thatthe fairvalueof a reportingunit
is lessthanits carryingamount,thenwe performadditionalquantitativetests to determinethemagnitudeof anyimpairment.
Duringourannualimpairmenttest,whichwasthefirstdayofthefourthquarter,wedeterminedthatgoodwillpassedthe
qualitativeassessmentandthereforeno quantitativeanalysisof goodwill impairmentwas necessaryin fiscal 2026.
As partof thechangetoourreportableoperatingsegmentsin fiscal2026,thegoodwillof theCompany’shistoricalreporting
units were reallocatedto the new reporting units on a relativefair value basisas of the date of the reorganization.The Company’s
determinationof fairvalueinvolved theuse ofestimatesandassumptions.Following theallocationof goodwill,the Company
performedaquantitativeimpairmenttest, forwhichtheCompanydeterminedthe estimatedfairvalueofeachreportingunit
exceededitscarryingvalueandthereforenoimpairmentwasidentified.WhentheCompanyacquiresanewlocation,a
determinationis made on how toallocategoodwillamongthe reportingunits. See
for updateddisclosures regarding theallocationof goodwill.
Judgment existsin management’sevaluationof the qualitativefactorswhich include macroeconomicconditions,the currentegg
industry environment,cost inputs such as feed ingredientsand overall financialperformance.Furthermore, judgmentexists in the
evaluationof thethresholdofwhetheritis morelikelythannot thatthefairvalueofareporting unitis less thanits carrying
amount.Uncertaintyexists due touncontrollableeventsthatcould occurthatcould negativelyaffectour operatingconditions.
RevenueRecognition
Revenuerecognitioniscompleteduponsatisfactionof theperformanceobligationwhichgenerallyoccursuponshipmentor
delivery toa customerbasedon termsof thesale.
Revenuesarerecognizedinanamountthat reflectsthe netconsiderationweexpectto receivein exchangefordeliveryof the
products. The Companyperiodically offers sales incentivesor other programssuch as rebates,discounts,coupons, volume-based
incentives,guaranteedsales andother programs.TheCompanyrecords anestimatedallowancefor costsassociatedwith these
programs,whichis recordedas a reductionin revenueat the timeof saleusinghistoricaltrends andprojectedredemptionrates
ofeachprogram.TheCompanyregularlyreviewstheseestimatesandanydifferencebetweentheestimatedcostsandactual
realizationof theseprogramswould be recognizedin thesubsequentperiod.
38
As theestimatesnotedaboveare basedon historical information,we donot believethatthere willbe amaterialchangein the
estimatesand assumptionsused to recognize revenue.However,if actualresults varied significantlyfromour estimates,it could
exposeus to materialgains or losses.
Loss Contingencies
The Companyevaluateswhether a losscontingencyexists,and if theassessmentof a contingencyindicatesit isprobable that
a
material losshasbeen incurredand theamountof the loss canbe reasonablyestimated,the estimatedloss would be accruedin
the Company’sfinancialstatements.The Companyexpensesthe costsof litigation astheyare incurred.
The Companyaccrued$4.0 million in litigationloss contingencyin fiscal 2026and $19.6million infiscal 2024.Therewere no
loss contingency accrualsfor fiscal 2025. Our evaluationof whether losscontingencies existprimarily relates to litigationmatters.
The outcomeof litigation is uncertain due to,amongother things, uncertaintiesregarding the factsthatwillbe establishedduring
theproceedings,uncertaintiesregardinghowthelawwillbeappliedtothefactsestablished,anduncertaintiesregardingthe
calculationofanypotentialdamagesor thecostsofanypotentialinjunctiverelief.IfthefactsdiscoveredortheCompany’s
assumptionschange, futureaccruals forloss contingenciesmaybe required. Resultsof operationsmaybe materiallyaffectedby
losses ora loss contingencyaccrualresulting from adverselegal proceedings.
IncomeTaxes
Wedetermineoureffectivetax rateby estimatingour permanentdifferences resultingfromdifferingtreatmentof itemsfor tax
and accountingpurposes. Judgmentand uncertaintyexist with management’sapplicationof tax regulationsand evaluationof the
more-likely-than-not recognitionand measurementthresholds. We are periodicallyauditedby taxing authorities.An adversetax
settlementcould havea negativeimpacton our effectivetaxrateandour results of operations.
ITEM 7A.QUANTITATIVEAND QUALITATIVEDISCLOSURESABOUTMARKET RISKS
COMMODITYPRICE RISK
Our primary exposureto marketrisk arises from changesin the prices of conventionalshell eggs, which are subjectto significant
price fluctuationsthat are largely beyond our control. Weare focused ondiversifying ouregg-basedplatformthat extends beyond
conventionalshell eggs andenhancesour earnings profile andresilience across marketcycles.
Ourexposureto marketrisk alsoincludeschangesinthepricesof cornandsoybeanmeal, whicharecommoditiessubjectto
significantprice fluctuationsdue tomarketconditionsthatare largelybeyondourcontrol.Toensurecontinuedavailabilityof
feedingredients,wemayenter into contractsfor futurepurchasesof cornandsoybeanmeal, andas partof thesecontracts,we
maylock-in thebasis portionof ourgrain purchasesseveral monthsin advanceandcommit topurchaseorganic ingredientsto
helpassure supply.Ordinarily,wedo not enterlong-termcontractsbeyonda yearto purchasecorn andsoybeanmealor hedge
againstincreasesin thepriceof cornandsoybeanmeal. The followingtableoutlinestheimpactof pricechangesfor cornand
soybeanmealon feedcosts per dozenas feedingredient pricing varies:
Changein price per bushelof corn
$
(0.84)
$
(0.56)
$
(0.28)
$
0.00
$
0.28
$
0.56
$
0.84
Change
in price
per ton
soybean
meal
$
(76.50)
0.42
0.43
0.44
0.45
0.46
0.47
0.48
$
(51.00)
0.43
0.44
0.45
0.46
0.47
0.48
0.49
$
(25.50)
0.44
0.45
0.46
0.47
0.48
0.49
0.50
$
0.00
0.45
0.46
0.47
0.48
(a)
0.49
0.50
0.51
$
25.50
0.46
0.47
0.48
0.49
0.50
0.51
0.52
$
51.00
0.47
0.48
0.49
0.50
0.51
0.52
0.53
$
76.50
0.48
0.49
0.50
0.51
0.52
0.53
0.54
(a)
Based on2026actualcosts, table flexesfeed cost inputsto show $0.01impacts toper dozenegg feed productioncosts.
39
INTERESTRATERISK
Wehave
a $
250 millionCreditFacility,borrowingsunderwhichwouldbearinterestatvariablerates.Noamountswere
outstandingunder theCredit Facilityduringfiscal2026or fiscal2025.Under ourcurrentpolicies,wedonot useinterestrate
derivativeinstrumentsto manageour exposureto interest ratechanges.
FIXEDINCOMESECURITIES RISK
At May 30, 2026,the effectivematurityof our cash equivalentsand investmentsecuritiesavailablefor sale was 11.3 months,and
the compositecredit ratingof theholdingsare A+/ A1/ A+(S&P /Moody’s/ Fitch).Generallyspeaking,rising interestrates
decreasethevalueoffixedincomesecuritiesportfolios.AsofMay30,2026,theestimatedfairvalueofourfixedincome
securitiesportfoliowasapproximately$816.8million andreflectednet unrealizedlossesof approximately$953thousand.For
additionalinformationsee
undertheheading“InvestmentSecurities
Available-for-Sale” and
in Part II. Item 8. Notesto the ConsolidatedFinancial
Statements.
CONCENTRATIONOF CREDITRISK
Our financialinstruments exposedto concentrationsof credit risk consist primarilyof trade receivables.Concentrationsof credit
risk withrespectto receivablesare limiteddue toourlarge numberof customersandtheir dispersionacross geographicareas,
except thatat May 30,2026and May31, 2025,26.2%and 28.1%,respectively,of ournet accountsreceivable balancewas due
fromWalmartInc.(includingSam’sClub).Noothersinglecustomerorcustomergrouprepresented10%orgreaterofnet
accountsreceivableatMay30, 2026andMay31, 2025.
40
ITEM 8.FINANCIALSTATEMENTSAND SUPPLEMENTARYDATA
Report ofIndependentRegisteredPublicAccounting Firm
Boardof Directors andStockholders
Cal-Maine Foods,Inc. andSubsidiaries
Ridgeland,Mississippi
Opinion on theConsolidatedFinancialStatements
Wehave auditedthe accompanyingconsolidatedbalancesheets ofCal-Maine Foods,Inc. andSubsidiariesas ofMay 30,2026
and May31,2025, therelatedconsolidatedstatementsof income,comprehensiveincome, stockholders’equity,and cashflows
for eachof the threeyears inthe periodended May30, 2026,and the relatedconsolidatednotes and schedulelisted in theIndex
at Items 15(a)(1)and 15(a)(2) (collectively referred to as the “consolidated financialstatements”).In our opinion, the consolidated
financial statementspresent fairly,in all materialrespects,the financialposition of Cal-Maine Foods,Inc. andSubsidiaries as of
May 30,2026 andMay 31, 2025,and the resultsof theiroperationsand their cashflows foreach ofthe three yearsin the period
endedMay30, 2026,in conformitywith accountingprinciples generally acceptedin the United Statesof America.
Wealsohaveaudited,inaccordancewith thestandardsofthePublic CompanyAccountingOversightBoard(UnitedStates)
(“PCAOB”),the Cal-Maine Foods,Inc. andSubsidiaries’ internalcontrol overfinancial reportingas ofMay 30,2026, basedon
the criteriaestablishedin
2013 InternalControl– IntegratedFramework
issued bythe Committeeof SponsoringOrganizations
of theTreadwayCommissionandour report datedJuly 22, 2026expressedanunqualifiedopinion.
Basis forOpinion
Theseconsolidatedfinancialstatementsare theresponsibilityof theentities’management.Our responsibilityis toexpressan
opinionontheseconsolidatedfinancialstatementsbasedon ouraudits.Weareapublicaccountingfirmregisteredwiththe
PCAOB andare requiredto be independentwith respectto Cal-Maine Foods,Inc. andSubsidiariesin accordancewith the U.S.
federalsecurities lawsandthe applicablerules andregulations ofthe Securities andExchangeCommissionandthe PCAOB.
Weconductedour audits in accordancewith the standardsof the PCAOB.Those standardsrequire that we plan and performthe
audittoobtainreasonableassuranceaboutwhethertheconsolidatedfinancialstatementsarefreeofmaterialmisstatement,
whetherduetoerrororfraud.Ourauditsincludedperformingproceduresto assessthe risksof materialmisstatementof the
consolidatedfinancialstatements,whether duetoerroror fraud,andperforming proceduresthatrespondtothoserisks.Such
proceduresincludedexamining,ona testbasis,evidenceregardingthe amountsanddisclosuresintheconsolidatedfinancial
statements.Our auditsalso includedevaluatingthe accountingprinciplesused andsignificantestimatesmadeby management,
as well as evaluatingthe overall presentationof the consolidatedfinancial statements.We believe our audits providea reasonable
basis forour opinion.
Critical AuditMatters
Thecriticalauditmatterscommunicatedbelow aremattersarisingfromthecurrentperiodauditof theconsolidatedfinancial
statementsthat were communicatedor requiredto be communicatedto theAudit Committeeandthat:(1) relate to accountsor
disclosuresthat arematerialto theconsolidatedfinancialstatementsand (2) involvedour especiallychallenging,subjective,or
complexjudgments.The communicationof the criticalaudit mattersdoes notalter inany wayouropinion onthe consolidated
financial statements,takenas awhole, andwe are not,by communicatingthe criticalauditmattersbelow,providinga separate
opinion onthe criticalauditmattersor on theaccountsor disclosures to which theyrelate.
ContingentLiabilities– Litigationand Claims– Refer to Note16 in the ConsolidatedFinancialStatements
Critical Audit Matter Description
Cal-MaineFoods,Inc.andSubsidiariesrecordliabilitiesforlegalproceedingsandclaimsinthoseinstanceswheretheycan
reasonablyestimatethe amountof the lossand whenthe liability is probable.Where the reasonableestimateof the probableloss
is a range, Cal-Maine Foods,Inc. andSubsidiaries recordthe most likelyestimateof the loss, or thelow end of the rangeif there
is no onebest estimate.Cal-Maine Foods,Inc. andSubsidiarieseither disclosethe amountof a possible lossor rangeofloss in
excess of established accrualsif estimable, or states thatsuch an estimate cannot be made.Cal-Maine Foods, Inc. and Subsidiaries
41
disclose significant legal proceedingsand claims even where liability is not probableor the amount of the liabilityis not estimable,
or both, if Cal-Maine Foods,Inc. andSubsidiaries believethere is atleast areasonablepossibility thata loss maybe incurred.
Weidentified litigationand claims asa critical auditmatterbecauseof the challenges auditingmanagement’sjudgmentsapplied
in determiningthe likelihoodof loss relatedto the resolutionof such claims.Specifically,auditing management’sdetermin
at
ion
of whetherany contingentloss arisingfrom therelatedlitigation andclaims isprobable, reasonablypossible, or remote,andthe
relateddisclosures,is subjectiveandrequires significant judgmentdue tothe sensitivity ofthe issue.
How the Critical Audit Matter was addressed during the Audit
Addressingthematterinvolvedperformingproceduresandevaluatingauditevidenceinconnectionwithformingouroverall
opinion onthe consolidatedfinancialstatements.These proceduresincluded testing theeffectivenessof thecontrols relatingto
the Cal-Maine Foods,Inc. and Subsidiaries’evaluationof theliability related tolegal proceedings andclaims, including controls
overdeterminingthelikelihoodofalossandwhethertheamountof losscanbereasonablyestimated,aswellasfinancial
statement disclosures overthe legal proceedingsand claims.These proceduresalso included obtainingand evaluatingthe letters
of audit inquiry withexternal legal counsel, evaluatingthe reasonablenessof Cal-Maine Foods, Inc. and Subsidiaries’assessment
regardingwhetheranunfavorableoutcomeisreasonablypossibleorprobable,andreasonablyestimable,evaluatingthe
sufficiencyof Cal-MaineFoods,Inc.andSubsidiaries’disclosuresrelatedto legalproceedingsandclaims andevaluatingthe
completenessandaccuracyof Cal-Maine Foods,Inc. andSubsidiaries’ legal contingencies.
AcquisitionofEchoLakeFoods,LLC–EstimatedforValuationofAcquiredIntangibleAssets– RefertoNote2 inthe
ConsolidatedFinancialStatements
Critical Audit Matter Description
Cal-MaineFoods,Inc.andSubsidiariescompletedthe acquisitionsof EchoLakeFoods,LLCandcertainrelatedcompanies,
effectiveJune2,2025foratotalnetconsiderationofapproximately$275million.Cal-MaineFoods,Inc.andSubsidiaries
accountedfortheacquisitionsofEchoLakeFoods,LLCandcertainrelatedcompaniesasabusinesscombination,and
accordingly,allocatedthe purchaseprice tothe assetsacquiredandliabilitiesassumedbasedon theirrespectiveestimatedfair
valuesas ofthedateof theacquisition.Identifiableintangibleassetsacquiredincludedcustomerrelationships,tradenames,
brand names,contractsand non-competeagreements.The excess of the purchaseconsiderationover the fair value of identifiable
assets acquiredand liabilitiesassumedwas recorded as goodwill.The valuationof acquired intangible assetsrequires significant
managementjudgmentdue totheuseofvaluationmodels thatincorporateunobservableinputs.Inparticular,thefairvalue
estimatesare sensitive to assumptionssuch as projected revenue,growth rates, customer attrition, discountrates, and contributory
assetcharges, whichrequire significant estimation.
Weidentifiedthevaluationof acquiredintangibleassetsas acriticalauditmatterbecauseof thesignificantauditorjudgment
requiredtoevaluatethe reasonablenessof management’sassumptionsandthe complexityinvolved inassessingthevaluation
methodologies utilized.
How the Critical Audit Matter was addressed during the Audit
Our auditproceduresrelatedto thevaluationof acquiredintangible assetsincluded thefollowing, among others:
●
TestingcontrolsoverCal-Maine Foods,Inc. andSubsidiariesacquisitionaccountingprocess,includingcontrolsover
the developmentandreview of key assumptionsused in thevaluationof intangibleassets
●
Evaluatingthevaluationmethodologiesusedbymanagementanditsthird-partyvaluationspecialists,including
assessingwhether themethodswere appropriateandconsistentwith applicablevaluationguidance.
●
Assessingkey assumptionsused in thevaluationmodels, including:
o
Projectedrevenuegrowth rates
o
Customerattritionrates
o
Discountrates
o
Contributoryassetcharges,bycomparingthemtohistoricalperformance,marketdata,andindustry
benchmarks
●
Involvingafairvaluespecialisttoassistinevaluatingthemethodologiesandsignificantassumptionsusedinthe
valuationmodels.
●
Evaluatingthe mathematicalaccuracyof thevaluationmodels andrecalculatingselected fairvalues.
●
Assessingthe competence,capabilities, andobjectivityof management’sthird-partyvaluationspecialists.
42
/s/ Frost, PLLC
Wehaveserved asthe Company’sauditorsince 2007.
Little Rock,Arkansas
July 22,2026
43
Cal-MaineFoods, Inc.and Subsidiaries
ConsolidatedBalanceSheets
(in thousands,exceptfor par valueamounts)
May30, 2026
May31, 2025
Assets
Current assets:
Cashandcashequivalents
$
107,217
$
499,392
Investmentsecurities available-for-sale
816,840
892,708
Receivables:
Tradereceivables, net
136,249
244,079
Incometaxreceivable
107,867
13,057
Other
20,315
15,225
Totalreceivables, net
264,431
272,361
Inventories,net
375,265
295,670
Prepaid expensesandother currentassets
17,789
7,979
Totalcurrent assets
1,581,542
1,968,110
Property,plant& equipment,net
1,318,335
1,026,684
Goodwill
97,059
46,776
Intangibleassets, net
73,130
15,157
Other assets
37,504
27,892
Totalassets
$
3,107,570
$
3,084,619
Liabilities andstockholders’equity
Current liabilities:
Tradeaccountspayable
$
96,106
$
101,033
Dividends payable
—
114,163
Accruedwages andbenefits
48,371
60,263
Accruedexpensesandother currentliabilities
61,039
32,912
Totalcurrent liabilities
205,516
308,371
Other liabilities
39,650
55,582
Deferredincometaxes
221,872
154,651
Totalliabilities
467,038
518,604
Commitmentsandcontingencies- see
Note 16
—
—
Stockholders’equity:
Commonstock ($
0.01
par value):
Commonstock– authorized
120,000
shares, issued
75,061
shares in 2026and2025
751
751
Paid-in capital
86,106
80,845
Retainedearnings
2,765,108
2,565,928
Accumulatedother comprehensiveloss, net of tax
(1,466)
(1,007)
Commonstock in treasury,atcost –
28,080
and
26,567
shares in 2026and2025,respectively
(217,767)
(85,893)
TotalCal-Maine Foods,Inc. stockholders’equity
2,632,732
2,560,624
Noncontrollinginterest in consolidatedequity
7,800
5,391
Totalstockholders’equity
2,640,532
2,566,015
Totalliabilities andstockholders’equity
$
3,107,570
$
3,084,619
See Notesto ConsolidatedFinancialStatements.
44
Cal-MaineFoods, Inc.and Subsidiaries
ConsolidatedStatementsof Income
(in thousands,exceptper shareamounts)
Fiscal yearsended
May30, 2026
May31, 2025
June 1, 2024
52 weeks
52 weeks
52 weeks
Net sales
$
2,911,632
$
4,261,885
$
2,326,443
Cost ofsales
2,239,583
2,411,000
1,784,872
Gross profit
672,049
1,850,885
541,571
Selling, generalandadministrative
329,291
314,449
252,625
(Gain) losson involuntaryconversions
(8,819)
156
(23,532)
(Gain) losson disposalof fixedassets
1,391
(259)
26
Operatingincome
350,186
1,536,539
312,452
Other income(expense):
Interestincome, net
46,175
48,059
31,726
Patronagedividends
11,670
11,197
11,331
Other,net
2,973
7,347
4,462
Totalother income
60,818
66,603
47,519
Incomebeforeincometaxes
411,004
1,603,142
359,971
Incometaxexpense
92,892
384,910
83,689
Net income
318,112
1,218,232
276,282
Less:Income(loss) attributableto noncontrollinginterest
1,430
(1,816)
(1,606)
Net incomeattributableto Cal-Maine Foods,Inc.
$
316,682
$
1,220,048
$
277,888
Net incomeper shareattributableto Cal-Maine Foods,Inc.:
Basic
$
6.65
$
25.04
$
5.70
Diluted
$
6.63
$
24.95
$
5.69
Weightedaverageshares outstanding:
Basic
47,650
48,719
48,717
Diluted
47,781
48,891
48,873
See Notesto ConsolidatedFinancialStatements.
45
Cal-MaineFoods, Inc.and Subsidiaries
ConsolidatedStatementsof
Comprehensive Income
(in thousands)
Fiscal yearsended
May30, 2026
May31, 2025
June 1, 2024
Net income
$
318,112
$
1,218,232
$
276,282
Other comprehensiveincome(loss), before tax:
Unrealizedholding gain(loss) available-for-sale securities,net of
reclassificationadjustments
(693)
928
1,271
Decrease inaccumulatedpost-retirementbenefitsobligation, netof
reclassificationadjustments
70
54
167
Other comprehensiveincome(loss), before tax
(623)
982
1,438
Incometaxexpense(benefit) relatedto items ofother comprehensiveincome
(loss)
(164)
216
325
Other comprehensiveincome(loss), net oftax
(459)
766
1,113
Comprehensiveincome
317,653
1,218,998
277,395
Less: comprehensiveincome(loss) attributableto thenoncontrolling interest
1,430
(1,816)
(1,606)
Comprehensiveincomeattributableto Cal-Maine Foods,Inc.
$
316,223
$
1,220,814
$
279,001
See Notesto ConsolidatedFinancialStatements.
46
Cal-MaineFoods, Inc.and Subsidiaries
ConsolidatedStatementsof Stockholders’Equity
(in thousands)
Accum.
Other
CommonStock
Comp.
Shares
Amount
Class A
Shares
Class A
Amount
Treasury
Shares
Treasury
Amount
Paid In
Capital
Retained
Earnings
Income
(loss)
Noncontrolling
Interest
Total
BalanceatJune 3, 2023
70,261
$
703
4,800
$
48
26,077
$
(30,008)
$
72,112
$
1,571,112
$
(2,886)
$
(1,498)
$
1,609,583
Stock compensationplan transactions
—
—
—
—
(55)
(1,589)
4,259
—
—
—
2,670
Dividends ($
1.889
per share)
Common
—
—
—
—
—
—
—
(83,565)
—
—
(83,565)
Class A common
—
—
—
—
—
—
—
(9,040)
—
—
(9,040)
Net income(loss)
—
—
—
—
—
—
—
277,888
—
(1,606)
276,282
Other comprehensiveincome, netof tax
—
—
—
—
—
—
—
—
1,113
—
1,113
BalanceatJune 1, 2024
70,261
703
4,800
—
48
26,022
(31,597)
76,371
1,756,395
(1,773)
(3,104)
1,797,043
Stock compensationplan transactions
—
—
—
—
(7)
(3,900)
4,474
—
—
—
574
Conversionof ClassA Shares
4,800
48
(4,800)
(48)
—
—
—
—
—
—
—
Repurchaseof Shares
—
—
—
—
552
(50,396)
—
—
—
—
(50,396)
Contributionsto Crepini FoodsLLC
—
—
—
—
—
—
—
—
—
6,485
6,485
Acquisitionof noncontrollinginterestin
MeadowCreekFoods LLC
—
—
—
—
—
—
—
(3,826)
—
3,826
—
Dividends ($
8.319
per share)
Common
—
—
—
—
—
—
—
(378,062)
—
—
(378,062)
Class A common
—
—
—
—
—
—
—
(28,627)
—
—
(28,627)
Net income(loss)
—
—
—
—
—
—
—
1,220,048
—
(1,816)
1,218,232
Other comprehensiveincome, netof tax
—
—
—
—
—
—
—
—
766
—
766
BalanceatMay31, 2025
75,061
751
—
—
26,567
(85,893)
80,845
2,565,928
(1,007)
5,391
2,566,015
Stock compensationplan transactions
—
—
—
—
(59)
(1,354)
5,261
—
—
—
3,907
Repurchaseof Shares
—
—
—
—
1,572
(130,520)
—
—
—
—
(130,520)
Dividends ($
2.458
per share)
Common
—
—
—
—
—
—
—
(117,502)
—
—
(117,502)
Contributions
—
—
—
—
—
—
—
—
—
979
979
Net income
—
—
—
—
—
—
—
316,682
—
1,430
318,112
Other comprehensiveloss, net of tax
—
—
—
—
—
—
—
—
(459)
—
(459)
BalanceatMay30, 2026
75,061
$
751
—
$
—
28,080
$
(217,767)
$
86,106
$
2,765,108
$
(1,466)
$
7,800
$
2,640,532
See Notes toConsolidatedFinancial Statements.
47
Cal-MaineFoods, Inc.and Subsidiaries
ConsolidatedStatementsof Cash Flows
(in thousands)
Fiscal yearended
May30, 2026
May31, 2025
June 1, 2024
Cash flowsfromoperating activities:
Net income
$
318,112
$
1,218,232
$
276,282
Adjustmentsto reconcile netincometo netcashprovidedby operating
activities:
Depreciationandamortization
124,342
94,021
80,241
Deferredincometaxes
67,363
11,570
(9,672)
Stock compensationexpense
5,757
4,527
4,358
Loss onchangein fair valuecontingentconsideration
—
15,000
5,500
Other operatingactivities, net
(4,425)
(15,426)
(6,908)
Changein operating assetsandliabilities, net of effectsfromacquisitions:
(Increase)decreasein tradereceivables
139,753
(104,997)
(27,570)
(Increase)decreasein inventories
(34,978)
(12,224)
28,800
Increase(decrease)in accountspayableandcurrent accruedexpenses
(8,338)
65,311
9,353
Net changein income taxesreceivableandpayable
(94,810)
(45,946)
91,567
Net changesin other operatingassetsandliabilities
(33,023)
(5,334)
(553)
Net cashprovidedby operatingactivities
479,753
1,224,734
451,398
Cash flowsfromused in investingactivities:
Purchasesof investments
(648,915)
(1,213,593)
(573,565)
Sales of investments
745,240
907,640
358,932
Acquisitionof businesses,net ofcashacquired
(427,794)
(116,193)
(53,746)
Acquisitionof Van's
(24,776)
—
—
Investmentin unconsolidatedentities
—
—
(363)
Distributionsfromunconsolidatedentities
3,253
4,050
3,000
Purchasesof property,plantandequipment
(151,220)
(161,255)
(147,116)
Net proceedsfromdisposal ofproperty,plantandequipment
328
3,882
272
Net cashused in investing activities
(503,884)
(575,469)
(412,586)
Cash flowsusedin financingactivities:
Principal paymentson long-termdebt
—
(2,481)
—
Principal paymentson financelease
—
—
(214)
Purchaseof commonstock bytreasury
(131,124)
(53,953)
(1,688)
Paymentsof dividends
(231,622)
(330,290)
(91,856)
Net cashused in financingactivities
(362,746)
(386,724)
(93,758)
Increase(decrease)in cash, cashequivalentsandrestricted cash
(386,877)
262,541
(54,946)
Cash,cashequivalentsandrestricted cashatbeginning of year
500,419
237,878
292,824
Cash,cashequivalentsandrestricted cashatend ofyear
$
113,542
$
500,419
$
237,878
See Notesto ConsolidatedFinancialStatements.
48
Cal-MaineFoods, Inc.and Subsidiaries
Notes toConsolidatedFinancialStatements
Note 1 -Summary ofSignificantAccounting Policies
Nature of Operations
Cal-Maine Foods,Inc. (“we,”“us,”“our,”or the“Company”)is thelargesteggcompanyin the UnitedStates(“U.S.”)and a
leadingplayerintheegg-basedfoodindustry.TheCompany’sshelleggportfoliospansthefulleggvalueladder—from
conventionaltospecialty,includingcage-free,nutritionallyenhanced,organic,brown,pasture-raised, andfree-rangeeggs—
serving both retail and foodservicecustomers nationwide. Cal-Maine Foods also participatesinthe growing prepared foodssector,
with offeringssuch as pre-cookedegg patties,omelets,folded andscrambled eggformats,hard-cooked eggs, pancakes,waffles,
and specialtywraps.Our brandedportfolio includesEggland’sBest®, LandO’Lakes®,FarmhouseEggs®, 4Grain®,Sunups®,
Van’s®,MeadowCreekFoods®,and Crepini®.Wesell most ofour productsthroughoutmuch ofthe U.S.and aimto maintain
efficient, state-of-the-artoperationslocated close to ourcustomers. Wewere foundedin1957 andare headquartered in Ridgeland,
Mississippi.
Principles of Consolidation
The consolidatedfinancial statementsinclude the accountsof all wholly-ownedsubsidiariesand of majority-owned subsidiaries
over whichwe exercisecontrol. Allsignificant intercompanytransactionsandaccountshavebeen eliminatedin consolidation.
Fiscal Year
TheCompany’sfiscalyear-end is onthe Saturdayclosest to May31.The fiscalyears endingon May30,2026,May 31,2025,
June 1, 2024eachincluded
52
weeks.
Use of Estimates
The preparationof the consolidatedfinancialstatementsin conformitywith generally acceptedaccountingprinciples (“GAAP”)
in the UnitedStates ofAmerica requiresmanagementto make estimatesand assumptionsthat affectthe amountsreported in the
consolidatedfinancialstatementsandaccompanyingnotes. Actualresults could differfromthose estimates.
Cash and Cash Equivalents
TheCompanyconsidersallhighlyliquidinvestmentswithamaturityofthreemonthsorlesswhenpurchasedtobecash
equivalents.Wemaintainbankaccountsthatare insuredbytheFederalDepositInsuranceCorporationupto$
250,000
.The
Companyroutinelymaintainscashbalanceswithcertainfinancialinstitutionsinexcessoffederallyinsuredamounts.The
Companyhas not experiencedany loss in such accounts.The Companymanages this risk through maintainingcash depositsand
other highlyliquidinvestmentsin high quality financialinstitutions.
InvestmentSecuritiesAvailable-for-Sale
The Companyhas determinedthat itsdebt securitiesare available-for-sale investmentsand areclassifiedas currentbecausethe
amountsinvestedareavailableforcurrentoperations.Available-for-salesecuritiesarecarriedatfairvalue,basedonquoted
marketpricesasofthebalancesheetdate,withunrealizedgainsandlossesrecordedinothercomprehensiveincome.The
amortizedcost of debt securitiesis adjustedfor amortizationof premiums andaccretion ofdiscounts to maturityand is recorded
in interest income.The Companyregularly evaluateschanges to therating of its debtsecurities bycredit agenciesand economic
conditionstoassessandrecordanyexpectedcredit lossesthrough allowanceforcreditlosses,limitedtotheamountthatfair
valuewas less thanthe amortizedcost basis.There was
no
allowancefor credit losses atMay30, 2026andMay31, 2025.
Thecost basisfor realizedgains andlosses onavailable-for-sale securitiesis determinedby thespecific identificationmethod.
Gains andlosses are recognized in otherincome (expense)as “Other,net”in the Company’sConsolidatedStatementsof Income.
Interestanddividendsonsecuritiesclassifiedasavailable-for-salearerecordedin“Interestincome,net”intheCompany’s
ConsolidatedStatementsof Income.
49
Trade Receivables
Tradereceivablesare statedattheircarryingvalues,whichincludea reserveforcredit losses.At May30,2026andMay31,
2025, reservesfor credit losseswere $
719
thousandand $
745
thousand,respectively.The Companyextends credit to customers
basedonanevaluationofeachcustomer’sfinancialconditionandcredithistory.Collateralis generallynotrequired.The
Companyminimizes exposuretocounterpartycreditrisk throughcreditanalysisandapprovals,credit limits,andmonitoring
procedures.Indeterminingourreserveforcreditlosses,receivablesareassignedanexpectedlossbasedonhistoricalloss
informationadjustedasneededforeconomicandotherforward-lookingfactors.AtMay30,2026andMay31,2025,
one
customeraccountedfor approximately
26.2
% and
28.1
% of theCompany’stradeaccountsreceivable, respectively.
Inventories
Inventories of flocks,feed, supplies, raw materialsand finishedgoods are valuedprincipallyat the lowerof cost or net realizable
value.The costof inventoriesis determinedby either thefirst-in, first-out methodor the weighted-averagemethod.
Thecostassociatedwithflocks,consistingprincipallyofchicks,feed,labor,contractorpaymentsandoverheadcosts,are
accumulatedduring a growing periodof approximately
22
weeks. Flock costsare amortizedto costof salesover theproductive
lives of theflocks, generally
one
to
two years
. As the amortizationperiod of the flocksis relativelyshort,disclosure ofthe gross
cost andaccumulatedamortizationis omitted. Flock mortalityis charged tocost ofsales asincurred.
Property,Plantand Equipment
Property,plant andequipmentare statedat cost.Depreciationis providedby thestraight-linemethodover theestimateduseful
lives,which are
15
to
25
years forbuildingsandimprovementsand
3
to
12
years formachineryandequipment.Expenditures
thatsignificantlyextendtheusefullifeoftherelatedassetsare capitalized.Normalrepairsandmaintenanceare expensedas
incurred. Whenproperty, plant,and equipmentare retired, sold, or otherwisedisposed of, theasset’s carryingamountand related
accumulateddepreciationare removed fromthe accountsandanygain or loss is includedin operations.Whencertainevents or
changesinoperatingconditionsoccur,assetlivesmaybeadjustedandanimpairmentassessmentmaybeperformedonthe
recoverabilityof thecarrying amounts.
Investmentsin UnconsolidatedEntities
The equitymethodof accountingis usedwhen theCompanycan exert significantinfluenceoveran entity,but doesnot control
itsfinancialandoperatingdecisions.Undertheequitymethod,originalinvestmentsarerecordedatcostandadjustedby the
Company’sshare of undistributedearnings orlosses of these entities. Equity investmentswithout readily determinablefair values,
whentheCompanydoesnothavetheabilitytoexercisesignificantinfluenceovertheinvestee,arerecordedatcost,less
impairment,plus or minus observableprice changes.
Goodwill
Goodwillrepresentstheexcessofthepurchasepriceoverthefairvalueoftheidentifiablenetassetsacquired.Goodwill is
evaluatedfor impairmentatleastannuallyormorefrequentlyifimpairmentindicatorsarisebyfirstperforminga qualitative
assessmentto determine whether a quantitativegoodwill test is necessary.After assessingthe totality of events or circumstances,
if wedetermineit is morelikely thannot thatthe fairvalue ofa reportingunit isless thanits carryingamount,then we perform
additionalquantitativetests to determinethe magnitudeof anyimpairment.
IntangibleAssets
Intangible assetsare initially recorded at fair value in businessacquisitions,which include franchiserights, customer relationships,
non-competeagreements, trademarksand right of use intangibles.They are amortizedover their estimateduseful lives of
5
to
15
years. Thegrosscostandaccumulatedamortizationofintangibleassetsareremovedwhentherecordedamountsarefully
amortizedandthe assetis no longerin useor thecontracthasexpired. When certaineventsor changesinoperatingconditions
occur, assetlives may be adjustedand an impairment assessmentmay be performed on the recoverability of the carrying amounts.
Indefinite lifeassetsare recorded atfair value inbusinessacquisitionsand representbrand namesand waterrights. They are not
amortized,but arereviewed for impairmentatleast annuallyor more frequentlyif impairmentindicatorsarise.
50
Insurance Liabilities and Restricted Cash
TheCompanyusesacombinationofinsuranceandself-insuranceprograms,includingawholly-ownedcaptiveinsurance
subsidiary(the “Captive”)to providecoveragefor thepotential liabilitiesforworkers’compensation,autoliability and general
liabilityrisks. Liabilitiesassociatedwith theserisksthatare retainedby theCompanyare not discountedandare estimated,in
part, byconsideringhistoricalclaims experience,severityfactorsand otheractuarialassumptions.These liabilitiesare recorded
within“Accruedexpensesand othercurrentliabilities”in theCompany’sConsolidatedBalanceSheets andwere$
11.4
million
and$
8.0
million at May30, 2026andMay31, 2025,respectively.
The Captivemaintainscertain levelsof cashand cashequivalentswhichare restrictedin useto securethe insurer’sobligations
for workers’ compensation,autoliability and generalliability programs.Restrictedcash was $
6.3
million and$
1.0
million as of
May30,2026andMay31,2025,respectively,andis recordedwithin“Prepaidexpensesandothercurrentassets”inthe
Company’sConsolidatedBalanceSheets.
TheCompanyalso maintainsmedicalplanscovering substantiallyall full-timeemployees.Under theplan, theCompanyself-
insures its portion of medical claims anduses stop-loss insurance to limit its portion of medical claims to $
275,000
per occurrence.
Liabilitiesassociatedwiththeserisksareestimatedinpartbyconsideringhistoricalclaimsexperience,medicalcosttrends,
demographicfactors, severityfactorsand otheractuarialassumptions.The Company’sexpensesincluding accrualsfor incurred
but not reportedclaims were approximately$
26.6
million, $
22.8
million, and$
23.0
million in fiscal years2026, 2025, and2024,
respectively.Theliability recordedfor incurredbut notreportedclaimswas$
4.3
millionand$
3.0
million asof May30, 2026,
andMay31,2025,respectivelyandareclassifiedwithin“Accruedexpensesandothercurrentliabilities”intheCompany’s
ConsolidatedBalanceSheets.
DividendsPayable
Dividends areaccruedat the endof eachquarter accordingto theCompany’sdividend policyadoptedby its Boardof Directors
(“Board”).TheCompanypays adividend tostockholdersof itsCommonStock ona quarterlybasis foreach quarterfor which
the Companyreports net income attributableto Cal-MaineFoods, Inc.,computedinaccordancewithGAAP,in an amountequal
to
one-third
(1/3) of such quarterlynet income.Dividends are paidto stockholdersof record asof the 60thday following thelast
dayof suchquarter,exceptfor thefourthfiscal quarter.For thefourthquarter,the Companypays dividendsto stockholdersof
record on the 65thday after the quarterend. Dividends are payableon the 15th day following the record date.Following a quarter
for whichthe Companydoes not reportnet incomeattributableto Cal-Maine Foods,Inc., theCompanywill not paya dividend
fora subsequentprofitablequarteruntil theCompanyis profitable ona cumulativebasis computedfromthe dateof themost
recent quarterfor which adividend waspaid. The dividendpolicy issubject to periodicreviewby the Board.In accordancewith
our variabledividend policy,we will notpay a cashdividend to holdersof our CommonStock with respectto our fourthquarter
of fiscal2026.
Revenue Recognition
TheCompanyrecognizes revenuethroughsaleof itsproductstocustomersthroughretail,foodserviceandotherdistribution
channels.ThemajorityoftheCompany’srevenueisderivedfromagreementsorcontractswithcustomersbaseduponthe
customerorderingitsproductswithasingleperformanceobligationofdeliveringtheproduct.TheCompanybelievesthe
performanceobligationis metupondeliveryandacceptanceof theproductbyourcustomers,whichgenerallyoccursupon
shipment or deliveryto a customer basedon terms of the sale. Costs paid to third partybrokers to obtainagreementsare expensed
as theCompany’sagreementsare generally less thanone year.
Revenuesarerecognizedinanamountthat reflectsthe netconsiderationweexpectto receivein exchangefordeliveryof the
products. The Companyperiodically offers sales incentivesor other programssuch as rebates,discounts,coupons, volume-based
incentives,guaranteedsales andother programs.TheCompanyrecords anestimatedallowancefor costsassociatedwith these
programs,whichis recordedas a reductionin revenueat the timeof saleusinghistoricaltrends andprojectedredemptionrates
ofeachprogram.TheCompanyregularlyreviewstheseestimatesandanydifferencebetweentheestimatedcostsandactual
realizationof theseprogramswould be recognizedthe subsequentperiod.
Shipping and Distribution
Coststodeliverproducttocustomersareincludedinselling,generalandadministrativeexpensesintheaccompanying
ConsolidatedStatementsof Incomeand totaled $
108.0
million, $
93.5
million, and$
72.7
million in fiscalyears 2026,2025, and
2024,respectively.
51
IncomeTaxes
Incometaxesareaccountedforusingtheliabilitymethod.Deferredincometaxesreflectthenettaxeffectsoftemporary
differencesbetweenthecarryingamountsof assetsandliabilitiesforfinancialreportingpurposesandtheamountsusedfor
income taxpurposes. The Company’spolicy withrespect to evaluating uncertaintax positions is based upon whether management
believesitis morelikelythannot theuncertaintaxpositionswillbesustaineduponreviewbythe taxingauthorities.Thetax
positionsmust meetthe more-likely-than-not recognitionthresholdwith considerationgiven tothe amountsand probabilities of
theoutcomesthatcould berealizeduponsettlementusingthefacts,circumstancesandinformationatthe reportingdate.The
Companywill reflectonlythe portionofthetaxbenefitthatwillbesustaineduponresolutionof thepositionandapplicable
intereston the portion ofthe tax benefitnot recognized.The Companyinitially and subsequentlymeasuresthe largest amountof
taxbenefitthatis greaterthan50% likelyto berealizeduponsettlementwitha taxingauthoritythathasfull knowledgeof all
relevantinformation.TheCompanyrecordsinterestandpenaltiesonuncertaintaxpositionsasacomponentofincometax
expense.Baseduponmanagement’sassessment,there areno uncertaintaxpositions expectedto havea materialimpacton the
Company’sconsolidatedfinancialstatements.
Business Combinations
The Companyapplies the acquisitionmethodof accounting,which requiresthat oncecontrol is obtained,all theassets acquired
and liabilitiesassumed,includingamountsattributableto noncontrollinginterests,are recordedattheir respectivefair values at
thedateof acquisition.Theexcessofthepurchasepriceoverfairvaluesofidentifiableassetsandliabilities isrecordedas
goodwill.
Weusevariousmodelsandmethodstodeterminethefairvaluesofidentifiableassetsandliabilities,suchastop-downand
bottom-upapproachfor inventory,cost methodandmarketapproachfor property,relief-from-royaltyandmulti-periodexcess
earnings tovalue intangibles.Significantestimatesin valuingcertain intangibleassets include,but are not limitedto, the amount
andtiming of futurecashflows, growth rates, discountrates anduseful lives.
Gain (Loss)on InvoluntaryConversions
TheCompanymaintains insurancefor bothpropertydamageandbusiness interruptionrelatingto catastrophicevents, suchas
fires,hurricanes,tornadoesandother actsof God,andis eligibletoparticipatein U.S.Departmentof Agriculture(“USDA”)
indemnityandcompensationprogramsforcertainlossesduetodiseaseoutbreakssuchashighlypathogenicavianinfluenza
(“HPAI”).Specifically,the AnimalHealth ProtectionAct authorizesthe USDA toprovide indemnitypaymentsto producers for
birds andeggsthatmust be destroyedduring adisease response.Paymentsreceived underthese programsare basedon thefair
marketvalueof thepoultryand/oreggs at thetime thatHPAIvirusis detectedin theflock.Other coveredcostsincludefeed,
depopulationanddisposal costs,andvirus eliminationcosts.TheUSDAdoesnot provideindemnityfor incomeorproduction
lossessufferedduetodowntimeorotherbusinessdisruptionsnorforindirectcontinuingexpenses.Recoveriesreceivedfor
propertydamage,businessinterruptionanddiseaseoutbreaksin excessof orless thanthenet bookvalueof damagedassets,
including poultry,clean-up anddemolition costs, and other direct post-event costs are recorded within“Gain (loss) on involuntary
conversions”in theperiod receivedor committedwhen all contingenciesassociatedwith the recoveries areresolved.
Loss Contingencies
Certain conditions mayexist as of the date the consolidated financial statements are issued thatmay resultina loss to the Company
but which willonly be resolvedwhen one ormore future eventsoccur or fail to occur.The Company’smanagementand its legal
counselassesssuchcontingentliabilities,andsuch assessmentinherentlyinvolvesanexerciseofjudgment.In assessingloss
contingenciesrelatedtolegalproceedingsthatare pendingagainsttheCompanyor unassertedclaims thatmayresult insuch
proceedings,the Company’slegalcounsel evaluatesthe perceivedmerits ofany legalproceedingsor unassertedclaims aswell
as theperceived meritsof theamountof relief sought or expectedto be soughttherein.
If theassessmentof acontingencyindicatesit is probablethata materialloss hasbeen incurredandthe amountof theliability
can be estimated,the estimatedliability wouldbe accruedin the Company’sconsolidatedfinancial statements.If the assessment
indicates a potentiallymaterial loss contingency is not probable,but is reasonablypossible, or isprobable butcannotbe estimated,
thenthe natureof thecontingentliability,togetherwith anestimateof therangeof possiblelossif determinableandmaterial,
would bedisclosed.Loss contingenciesconsideredremote aregenerallynot disclosedunless theyinvolveguarantees,in which
casethe natureof theguaranteewould be disclosed.
The Companyexpensesthe costsof litigation astheyare incurred.
52
New Accounting Pronouncements and Policies
In December2023, theFASBissued ASU2023-09,
Income Taxes(Topic740) -Improvementsto Income TaxDisclosures
. This
ASUrequiresthatanentity,onanannualbasis,discloseadditionalincometaxinformation,primarilyrelatedtotherate
reconciliationand incometaxes paid.TheASU isintendedto enhancethe transparencyand decisionusefulnessof incometax
disclosures.ASU 2023-09 iseffectivefor fiscalperiodsbeginningafterDecember15,2024.TheCompanyhas adoptedASU
2023-09for theyearendedMay30, 2026,on aprospectivebasis.See
IncomeTaxes
for additionaldisclosures.
InNovember2024,theFASBissuedASU2024-03,
IncomeStatement
—
ReportingComprehensiveIncome
—
Expense
DisaggregationDisclosures(Subtopic220-40)
. The objectiveof ASU 2024-03 is to improvedisclosuresabouta public entity’s
expenses,primarilythrough additionaldisaggregationof incomestatementexpenses.Additionally,in January2025,the FASB
furtherclarifiedtheeffectivedateofASU2024-03 withtheissuanceof ASU2025-01. ASU2024-03 is effectiveforannual
periodsbeginningafterDecember15,2026,andinterim periodswithinannualreporting periodsbeginningafterDecember15,
2027.Earlyadoptionis permitted andmaybe appliedeither on aprospectiveor retrospectivebasis.TheCompanyis currently
evaluatingthe impactof ASU 2024-03on its consolidatedfinancialstatementdisclosures.
Thereare noother newaccountingpronouncementsissued or effectiveduringthe fiscalyearthat hador are expectedtohave
a
materialimpacton our consolidatedfinancialstatements.
Note 2 – Acquisitions
Acquisition of Creighton Brothers, LLC
Effectiveon
March 2, 2026
, the Companyacquired the shell egg,egg products,and preparedfoods assets ofCreighton Brothers
LLC andincludingCrystal LakeLLC(“Creighton”).The acquiredassetsincludecommercialshell eggproductionand grading
with capacityof approximately
3.2
million layers, including
500
thousandcage-free layers, and
865
thousandpullets, a feed mill,
1,007
acres ofland, aswellas anegg products andhard-cookedegg processing facility locatednearWarsaw,Indiana.
Thefollowingtablesummarizesthe considerationpaidforCreightonandthe valueofassetsacquiredandliabilitiesassumed
recognizedatthe acquisitiondate(in thousands):
Cashconsiderationpaid
$
128,784
Recognizedamountsof identifiableassetsacquiredandliabilitiesassumed
Inventories
$
16,504
Prepaid expensesandother currentassets
890
Property,plant& equipment
101,883
Intangibleassets, net
60
119,337
Accountspayableandother currentliabilities
(553)
Totalidentifiablenet assets
118,784
Goodwill
10,000
$
128,784
Inventories consistedprimarilyof flock, feedingredients,packaging, andegg inventory.Flock inventorywas valuedat carrying
valueasmanagementbelievesthatitscarryingvaluebestapproximatesitsfairvalue.Feedingredients,packagingandegg
inventorywere all valuedbasedon marketprices as ofMarch2, 2026.
53
Property,plantandequipmentwerevaluedutilizingthecostapproachandmarketapproach.Machineryandequipmentwere
valuedutilizingthecostapproachwhichisbasedonreplacementorreproductioncostsoftheassetsandsubtractingany
depreciationresultingfrom physicaldeteriorationand/orfunctionalor economicobsolescence.Landandbuildings were valued
utilizingthe marketapproachby using a realestatevaluation.
Goodwill recorded inconnectionwiththe Creighton acquisitionis primarily attributableto improved efficiencies from integrating
the assetsof Creightonwith theoperationsof theCompany.The Companyrecognized goodwill of$
10.0
millionas aresult of
the acquisition.
Acquisitionof CleanEgg, LLC
Effective
October 10, 2025
,the Companyacquiredcertainassetsof CleanEgg,LLC (“CleanEgg”) basedin Langwood,Texas,
forapproximately$
23.7
million. Theassetsacquiredincluded
677
thousandbrown cage-freeandfree-rangelayersandpullets
andotherinventory,machineryandequipmentrelatedtoitscontractproductionandegg processingbusiness.TheCompany
recognizedgoodwillof $
10.2
millionas aresultoftheacquisition.TheCompanyaccountedfor theacquisitionasa business
combination.
Acquisitionof EchoLake Foods,LLC
Effective
June 2, 2025
, the Companyacquired EchoLakeFoods, LLC andcertainrelatedcompanies(collectively “EchoLake
Foods”).EchoLakeFoods isbasedin Burlington,Wisconsinandproduces,packages,marketsanddistributes preparedfoods,
including pre-cookedegg patties,omelets, folded andscrambled egg formats,pancakes andwaffles. The Companyaccounted for
the acquisitionas abusiness combination.
54
TheCompanyfinalizedthebusinesscombinationaccountingduringthesecondquarteroffiscal2026,whichresultedin
immaterialmeasurementperiod adjustments.The followingtablesummarizesthe considerationpaidforEcho LakeFoods and
the valueof assetsacquiredandliabilitiesassumedrecognized atthe acquisitiondate(in thousands):
Cashconsiderationpaid
$
275,406
Recognizedamountsof identifiableassetsacquiredandliabilitiesassumed
Cash
$
115
Investmentsecurities available-for-sale
14,147
Accountsreceivable
31,923
Inventories
21,601
Prepaid expensesandother currentassets
3,131
Property,plant& equipment
151,697
Intangibleassets
36,800
259,414
Accountspayableandother currentliabilities
(14,114)
Totalidentifiablenet assets
245,300
Goodwill
30,106
$
275,406
Cash andaccounts receivableacquired along with liabilitiesassumedwere valued at their carrying valuewhich approximatesfair
valuedue tothe shortmaturityof theseinstruments.
Inventoriesconsistedprimarilyofraw materials,suppliesandfinished goods.Rawmaterialsandsupplies werevaluedattheir
carryingvalueas managementbelieves thattheir carryingvalue bestapproximatestheir fair value.Finishedgoods werevalued
using both thebottom-up and top-downapproach.The bottom-up approachmeasures the value of inventoryas the valuecreated
by thetargetcompany(i.e., the costsincurred, profitrealized,andtangible andintangibleassetsutilized)pre-acquisitiondate.
Thetop-downapproachmeasuresthe valueof inventoryas theincrementalinventoryvaluecreatedby themarketparticipant
buyer aspart ofitsselling effortto anend customer(i.e., thecoststhat willbe incurred,the profitthat willberealized,and the
tangible andintangible assetsthatwillbe utilized)post-acquisitiondate.
Property,plantandequipmentwerevaluedutilizingthecostapproachandmarketapproach.Machineryandequipmentwere
valuedutilizingthecostapproachwhichisbasedonreplacementorreproductioncostsoftheassetsandsubtractingany
depreciationresultingfrom physicaldeteriorationand/orfunctionalor economicobsolescence.Landandbuildings were valued
utilizingthe marketapproachby using a realestatevaluation.
Intangibleassetsconsistedprimarilyof customerrelationshipsand atradename.Customer relationshipswerevalued usingthe
multi-periodexcess earningsmethodandthe tradenamewas valuedusing the relief-from-royaltymethod.
Goodwillrepresents the excessof the purchaseprice of the acquiredbusiness overthe acquisitiondate fair valueof the netassets
acquired.Goodwill recordedin connectionwith theEcho LakeFoods acquisitionis primarilyattributableto projected synergies
from integratingthe operationsof Echo LakeFoods withthe operationsof the Company.The Companyrecognized goodwill of
$
30.1
million as aresult of theacquisition,all of which is deductiblefor taxpurposes.
The Companyrecorded transactioncosts of $
594
thousand in the first quarter of fiscal 2026and $
6.6
million in the fourthquarter
of fiscal 2025, respectively,as a result of the Echo LakeFoods acquisition,within “Selling,generaland administrativeexpenses”
in theCompany’sConsolidatedStatementsof Income.
Acquisitionof Deal-RiteFeeds, Inc. Assets
Effective
February 3, 2025
,the Companyacquired certain assets of Deal-Rite Feeds, Inc. and certainof itsaffiliates(“Deal-Rite”)
forapproximately$
4.7
million.Theassetsacquiredincluded
two
feedmills,storagefacilities,usablegrain,vehicles,related
55
equipmentanda retailfeedsalesbusinesslocatedin NorthCarolina.Theacquiredassetswillproduceanddeliverfeedtoour
nearbyshell egg productionfacilities. The Companyaccountedfor theacquisitionas abusiness combination.
Property,plantandequipmentwere valuedutilizingthe costapproachwhich is basedon replacementor reproductioncostsof
the assetsandsubtractinganydepreciationresulting from physicaldeteriorationand/orfunctionalor economicobsolescence.
Goodwill recordedin connectionwith the Deal-Rite acquisitionis primarily attributableto improved efficiencies from integrating
the assets ofDeal-Ritewith the operationsof the Company.The Companyrecognized goodwill of $
1.0
million as aresult of the
acquisition.
Acquisitionof ISE America, Inc. Assets
Effective
June 28, 2024
, theCompanyacquiredsubstantiallyall ofthecommercialshelleggproduction,processingandegg
productsbreakingfacilitiesof ISEAmerica,Inc. andcertainof itsaffiliates(“ISE”).The assetsacquiredincludedcommercial
shell egg productionand processingfacilities witha capacityat the time of acquisitionof approximately
4.7
million laying hens,
including
1.0
million cage-free,and
1.2
millionpullets,feedmills,approximately
4,000
acres ofland,inventoriesandanegg
products breakingfacility.The acquiredassetsalso include anextensivecustomer distributionnetwork acrossthe Northeastand
Mid-Atlantic states, andproductionoperationsinMaryland,NewJersey,Delaware and SouthCarolina.The Companyaccounted
for theacquisitionas abusiness combination.
ThefollowingtablesummarizestheconsiderationpaidfortheISEassetsandtheamountsof assetsacquiredandliabilities
assumedrecognized atthe acquisitiondate(in thousands):
Cashconsiderationpaid
$
111,521
Recognizedamountsof identifiableassetsacquiredandliabilitiesassumed
Inventories
$
20,547
Property,plantandequipment
90,572
Intangibleassets
710
111,829
Accountspayableandother currentliabilities
(308)
Totalidentifiablenet assets
$
111,521
Inventories consistedprimarilyof flock, feedingredients,packaging, andegg inventory.Flock inventorywas valuedat carrying
valueasmanagementbelievesthatitscarryingvaluebestapproximatesitsfairvalue.Feedingredients,packagingandegg
inventorywere all valuedbasedon marketprices as ofJune 28,2024.
Property,plantandequipmentwere valuedutilizingthe costapproachwhich is basedon replacementor reproductioncostsof
the assetsandsubtractinganydepreciationresulting from physicaldeteriorationand/orfunctionalor economicobsolescence.
Intangible assetsconsistedprimarilyof customer listsacquired. Customerslists were valuedusing the incomemethodapproach.
Other Acquisitionsand Investments
Effective
May 12, 2026
,the Companyacquired certain assets of Van’sFoods business of Sara Lee Frozen Bakey,LLC (“Van’s”)
for approximately$
24.8
million. The assets acquired included trademarksand trade names, customernetworks and inventory and
willsupportourpreparedfoodssegmentanddelivergreatervalueacrossthesupplychain.TheCompanyaccountedfor the
acquisitionas anassetacquisition.
Effective
September 9, 2024
, the Companycompleteda strategicinvestmentwith Crepini LLC, establishing a new egg products
and preparedfoods venture. The new entity, located in Hopewell Junction, New York,operatesas Crepini Foods LLC (“Crepini”).
TheCompanycapitalizedCrepini withapproximately$
6.75
million incashto purchaseadditionalequipmentandother assets
56
andfundworkingcapitalinexchangefora
51
% interestinthenewventure.CrepiniLLCcontributeditsexistingassetsand
businessin exchangefor a
49
% interest in the new venture.
Effective
November 30, 2024
,theCompanyacquiredtheremaining
9.23
%interestinourmajority-ownedsubsidiary,
MeadowCreekFoods LLC.
Note 3 -InvestmentSecuritiesAvailable-for-Sale
ThefollowingpresentstheCompany’sinvestmentsecuritiesavailable-for-saleasofMay30,2026andMay31,2025(in
thousands):
May30, 2026
Amortized
Cost
Unrealized
Gains
Unrealized
Losses
EstimatedFair
Value
Municipal bonds
$
12,362
$
4
$
—
$
12,366
Commercialpaper
42,562
—
16
42,546
Corporatebonds
569,137
—
742
568,395
Certificatesof deposits
3,226
—
6
3,220
US governmentandagencyobligations
153,172
—
187
152,985
Treasurybills
37,334
—
6
37,328
Totalcurrent investmentsecurities
$
817,793
$
4
$
957
$
816,840
May31, 2025
Amortized
Cost
Unrealized
Gains
Unrealized
Losses
EstimatedFair
Value
Municipal bonds
$
21,695
$
3
$
—
$
21,698
Commercialpaper
90,880
—
50
90,830
Corporatebonds
431,378
130
—
431,508
Certificatesof deposits
5,200
—
6
5,194
US governmentandagencyobligations
240,655
—
260
240,395
Treasurybills
103,119
—
36
103,083
Totalcurrent investmentsecurities
$
892,927
$
133
$
352
$
892,708
Actual maturitiesmaydiffer fromcontractualmaturities assome borrowershavethe right tocall orprepayobligationswithor
without penalties.Contractualmaturitiesof currentinvestmentsecurities atMay30, 2026are asfollows (in thousands):
EstimatedFair Value
Within oneyear
$
474,328
1-5 years
342,512
Total
$
816,840
Note 4 -Fair ValueMeasurements
TheCompanyis requiredtocategorizebothfinancialandnonfinancialassetsandliabilitiesbasedon thefollowingfair value
hierarchy.Thefairvalueofanassetis thepriceatwhichthe assetcouldbesold inanorderlytransactionbetweenunrelated,
knowledgeable,and willingparties ableto engagein thetransaction.A liability’sfair value isdefined asthe amountthat would
be paid totransfer theliability to a newobligor in atransactionbetween such parties, notthe amountthat would be paid tosettle
the liability withthe creditor.
●
Level 1
- Quotedprices inactivemarketsfor identicalassetsor liabilities
●
Level2
-Inputsotherthanquotedprices includedinLevel 1thatare observablefortheassetorliability,either
directly orindirectly,including:
o
Quotedprices for similarassetsor liabilities inactivemarkets
o
Quotedprices for identicalor similarassetsin non-activemarkets
o
Inputsother thanquotedprices thatare observablefor theassetor liability
o
Inputsderived principally fromor corroboratedby otherobservablemarketdata
57
●
Level3
-Unobservableinputsfortheassetorliabilitythatare supportedbylittleornomarketactivityandare
significantto thefair valueof theassetsor liabilities
The disclosureof fairvalueof certainfinancialassetsandliabilitiesthatare recordedatcost areas follows:
Cash and Cash Equivalents, Accounts Receivable, andAccounts Payable
The carryingamountapproximatesfair valuedue tothe shortmaturityof theseinstruments.
Assets andLiabilitiesMeasuredat Fair Valueon a RecurringBasis
In accordancewith the fair valuehierarchydescribedabove,the followingtableshows the fairvalueof ourfinancial assetsand
liabilitiesthat are requiredto be measuredat fair value on a recurringbasis as of May30, 2026 andMay 31, 2025 (in thousands
):
May30, 2026
Level 1
Level 2
Level 3
Balance
Investmentsecurities available-for-sale
Municipal bonds
$
—
$
12,366
$
—
$
12,366
Commercialpaper
—
42,546
—
42,546
Corporatebonds
—
568,395
—
568,395
Certificatesof deposits
—
3,220
—
3,220
US governmentandagencyobligations
—
152,985
—
152,985
Treasurybills
—
37,328
—
37,328
Totalinvestmentsecurities available-for-sale
measuredatfair value
$
—
$
816,840
$
—
$
816,840
Liabilities
Contingentconsideration
—
—
21,500
21,500
Totalliabilities measuredatfair value
$
—
$
—
$
21,500
$
21,500
May31, 2025
Level 1
Level 2
Level 3
Balance
Investmentsecurities available-for-sale
Municipal bonds
$
—
$
21,698
$
—
$
21,698
Commercialpaper
—
90,830
—
90,830
Corporatebonds
—
431,508
—
431,508
Certificatesof deposits
—
5,194
—
5,194
US governmentandagencyobligations
—
240,395
—
240,395
Treasurybills
—
103,083
—
103,083
Totalinvestmentsecurities available-for-sale
measuredatfair value
$
—
$
892,708
$
—
$
892,708
Liabilities
Contingentconsideration
—
—
21,500
21,500
Totalliabilities measuredatfair value
$
—
$
—
$
21,500
$
21,500
Investmentsecurities – available-for-sale are all classifiedas Level 2 andconsist ofsecurities with maturitiesof threemonthsor
longerwhenpurchased.Weclassifiedthesesecuritiesascurrentbecauseamountsinvestedarereadilyavailableforcurrent
operations.Observableinputs forthese securitiesare yields, creditrisks, defaultrates, andvolatility.
Contingentconsiderationclassifiedas Level3 consistsof thepotentialobligationto payanearnoutto FassioEgg Farms,Inc.
(“Fassio”)contingenton theacquiredbusinessmeetingcertainreturnonprofitabilitymilestonesoverathree-yearperiodthat
commencedon the dateof theacquisitionin the secondquarterof fiscal2024.The fair valueof thecontingentconsiderationis
estimatedusing a discountedcash flowmodel. Keyassumptionsand unobservableinputs that requiresignificantjudgmentused
in theestimateinclude weightedaveragecost ofcapital,eggprices,projectedrevenueandexpensesover theperiodforwhich
thecontingentconsiderationismeasured,andtheprobabilityassessmentswithrespecttothelikelihoodofachievingthe
forecastedprojections.
58
The followingtableshows thebeginningandendedbalancesin fair valuefor thecontingentconsideration:
Fassio ContingentConsideration
Balance,June 4, 2023
$
—
Acquisitionof Fassio
1,000
Fair valueadjustments
5,500
Balance,June 1, 2024
6,500
Fair valueadjustments
15,000
Balance,May31, 2025
21,500
Fair valueadjustments
—
Balance,May30, 2026
$
21,500
At May30, 2026, the contingentconsiderationis recordedwith accruedexpenses andother currentliabilities in the consolidated
balancesheets.Adjustmentstothefairvalueofcontingentconsiderationarerecordedwithintheselling,generaland
administrativeexpensesin the consolidatedstatementsof income.
Note 5 -Inventories
Inventoriesconsistedof thefollowing (in thousands):
May30, 2026
May31, 2025
Flocks, netof amortization
$
192,673
$
166,507
Feed andsupplies
84,769
65,192
Raw materialsandfinished goodsinventory
97,823
63,971
$
375,265
$
295,670
Wegrow andmaintain flocks of layers(mature femalechickens), pullets(female chickensunder 18 weeksof age), andbreeders
(male andfemalechickens usedto producefertile eggsto hatchfor egg productionflocks).Ourtotal flockat May 30,2026 and
May 31,2025, consistedof approximately
14.1
million and
11.5
millionpullets andbreedersand
50.0
millionand
48.3
million
layers,respectively.
The Companyexpensedamortizationandmortalityassociatedwith the flocksto costof salesas follows (in thousands):
May30, 2026
May31, 2025
June 1, 2024
Amortization
$
205,041
$
196,248
$
198,298
Mortality
11,170
10,619
10,640
Totalflock costschargedto costof sales
$
216,211
$
206,867
$
208,938
Note 6 -Property,Plant and Equipment
Property,plantandequipmentconsistedof thefollowing (in thousands):
May30, 2026
May31, 2025
Landandimprovements
$
176,243
$
158,627
Buildings andimprovements
835,670
722,552
Machineryandequipment
1,085,789
876,024
Construction-in-progress
207,006
148,621
2,304,708
1,905,824
Less: accumulateddepreciation
986,373
879,140
$
1,318,335
$
1,026,684
Depreciationexpense was $
116.6
million, $
91.1
million and$
77.2
million in the fiscal years endedMay 30, 2026, May31, 2025,
andJune 1, 2024,respectively.
59
Note 7 -Investmentin UnconsolidatedEntities
As of May30, 2026 andMay 31,2025,the Companyowned
50
% of SpecialtyEggs,LLC (“SpecialtyEggs”) andof Southwest
SpecialtyEggs,LLC (“SouthwestSpecialtyEggs”),which areaccountedfor using the equitymethodof accounting.Specialty
Eggs owns the Egg-Land’sBest franchisefor most of Georgia andSouth Carolina,as well as a portionof western North Carolina
and easternAlabama.Southwest Specialty Eggsowns the Egg-Land’sBest franchisefor Arizona, southernCalifornia andClark
County,Nevada(including Las Vegas).
Equitymethodinvestmentsareincludedin“Otherassets”intheaccompanyingConsolidatedBalanceSheetsandtotaled
$
5.6
million and$
10.3
million at May30, 2026andMay31, 2025,respectively.
Equity in income (loss) of unconsolidatedentities of a $
1.3
million loss, $
6.2
million income,and $
1.4
million income from these
entitieshasbeen includedin“Other,net” intheaccompanyingConsolidatedStatementsof Incomefor fiscal2026,2025,and
2024,respectively.
The followingrelates tothe Company’stransactionswith these unconsolidatedaffiliates(in thousands):
For thefiscal yearended
May30, 2026
May31, 2025
June 1, 2024
Sales to unconsolidatedentities
$
76,130
$
110,106
$
100,553
Purchasesfromunconsolidatedentities
75,031
76,167
63,916
Distributionsfromunconsolidatedentities
3,253
4,050
3,000
May30, 2026
May31, 2025
Accountsreceivablefromunconsolidatedentities
$
5,224
$
5,090
Accountspayableto unconsolidatedentities
955
613
Note 8 -Goodwill andOther IntangibleAssets
Goodwill
During thefourthquarter offiscal 2026,the Companytransitionedinto its new reportingstructure whichresultedin changesto
the Company’soperating segments andreporting units.The goodwill of the Company’shistorical reporting units were reallocated
to thenew reportingunits on arelative fairvaluebasis asof the dateof the reorganization.TheCompanyassessedgoodwill for
impairmentimmediatelybefore andimmediatelyafter thereorganizationand concludedthatthere was nogoodwill impairment.
Formore informationregarding thechangestoourreportablesegmentsinthe fourthquarterof fiscal2026,refer to
The changesin the carrying amountof goodwill were (in thousands):
Consolidated
Business
Conventional
Shell Eggs
SpecialtyShell
Eggs
PreparedFoods
Total
BalanceJune 1, 2024
$
45,776
$
—
$
—
$
—
$
45,776
Additions
1,000
—
—
1,000
BalanceMay31, 2025
46,776
—
—
—
46,776
Additions
50,283
—
—
—
50,283
BalanceMarch2, 2026
97,059
—
—
—
97,059
Goodwillreallocation
(97,059)
13,790
53,163
30,106
—
BalanceMay30, 2026
$
—
$
13,790
$
53,163
$
30,106
$
97,059
60
IntangibleAssets
The carryingamountsfor indefinite-livedintangibles consistedof thefollowing (in thousands):
May30, 2026
May31, 2025
Brandname
$
14,526
$
—
Waterrights
2,942
2,942
Total
$
17,468
$
2,942
Duringfiscal2026,theCompanypurchasedtheVan’sbrandnameaspartoftheassetacquisition.Thisintangibleassetis
classifiedas anindefinite-lived brandname.
Intangibleassets, net,subjectto amortization,consistedof thefollowing (inthousands):
Franchise rights
Customerrelationships
Other intangibles
Total
BalanceJune 1, 2024
$
11,787
$
608
$
659
$
13,054
Additions
—
700
619
1,319
Amortization
(1,596)
(353)
(209)
(2,158)
BalanceMay31, 2025
10,191
955
1,069
12,215
Additions
—
40,000
10,212
50,212
Amortization
(1,595)
(3,555)
(1,615)
(6,765)
BalanceMay30, 2026
$
8,596
$
37,400
$
9,666
$
55,662
Forintangibleassetssubjecttoamortization,thegrosscarryingamountsandaccumulatedamortizationareasfollows(in
thousands):
May30, 2026
May31, 2025
Gross carrying
Accumulated
Gross carrying
Accumulated
amount
amortization
amount
amortization
Amortizableintangibleassets:
Franchise rights
$
27,979
$
(19,383)
$
29,284
$
(19,093)
Customerrelationships
41,700
(4,300)
1,700
(745)
Other intangibles
11,981
(2,315)
1,769
(700)
Total
$
81,660
$
(25,998)
$
32,753
$
(20,538)
No significantresidual value is estimatedfor these intangible assets.Aggregate amortizationexpense for fiscal years 2026,2025,
and 2024totaled $
6.8
million, $
2.2
million and $
2.2
million, respectively.Amortizationexpenses is classified in “Selling,general
andadministrativeexpenses”in the accompanyingConsolidatedStatementsof Income.
Thefollowingtablepresentsthetotalestimatedamortizationexpenseofintangibleassetsforthefivesucceedingyears(in
thousands):
For fiscal year
Estimatedamortizationexpense
2027
$
7,735
2028
7,665
2029
7,602
2030
7,512
2031
6,351
Thereafter
18,797
Total
$
55,662
61
Note 9 -EmployeeBenefit Plans
KSOP
TheCompanymaintainsaKSOP coveringsubstantiallyall employees(the“Plan”).TheCompanycontributes
3
% ofeligible
compensation,plus discretionaryamounts,withcontributionsvestingimmediately.CashcontributionstothePlanwere$
7.0
million,$
5.5
million and$
4.3
millioninfiscal2026,2025,and2024,respectively.The PlanpurchasesCompanystock in the
openmarketusing Companycontributionsanddividends.
Deferred Compensationand Other PostretirementPlans
The Companymaintains severaldeferredcompensationand other postretirementplans forcertainofficersand aselect groupof
managementandhighly compensatedemployees ofthe Company.The liabilityrecordedrelatedtotheseagreementswas$
6.7
million and$
4.1
million atMay 30,2026and May31, 2025,respectivelyand is classifiedwithin “Accruedexpensesand other
currentliabilities”and“Otherliabilities”inthe Company’sConsolidatedBalanceSheets. Therelatedexpensefor theseplans
was $
1.1
million, $
1.5
million and$
1.2
million in fiscal 2026,2025and2024,respectively.
Note 10- Credit Facility
Forfiscalyears2026,2025and2024,interestexpensewas$
556
thousand,$
612
thousandand$
549
thousand,respectively,
primarilyrelatedto commitmentfees onthe Credit Facility describedbelow.
On November 15, 2021,we entered into an Amendedand RestatedCredit Agreement (as amended,the “Credit Agreement”) with
a
five-year
term, expiringNovember15, 2026. TheCredit Agreementprovidesfor
a
senior securedrevolvingcredit facility(the
“CreditFacility”or “Revolver”)inaninitialaggregateprincipalamountof upto$
250
million,whichincludesa $
15
million
sublimitfortheissuanceof standbylettersofcreditanda $
15
millionsublimitforswinglineloans.TheCreditFacilityalso
includesan accordionfeaturepermitting,with theconsent ofBMO HarrisBank N.A.(the “AdministrativeAgent”),an increase
intheCreditFacilityintheaggregateupto$
200
millionbyaddingoneormoreincrementalseniorsecuredtermloansor
increasingoneormoretimestherevolvingcommitmentsundertheRevolver.
No
amountswereborrowedundertheCredit
Facility as ofMay 30,2026 or May31, 2025 or duringfiscal 2026or fiscal2025. The Companyhad $
5.9
million of outstanding
standbyletters of credit issued underthe Credit FacilityatMay30, 2026.
On May26,2023, weenteredinto theFirst Amendment(the “FirstAmendment”)to theCreditAgreement,which replacedthe
London InterbankOffered Rateinterest rate benchmarkwith the secured overnightfinancing rateas administeredby the Federa
l
ReserveBank ofNew Yorkor asuccessoradministratorof thesecured overnightfinancingrate (“SOFR”).Theinterestrate in
connectionwith loansmadeunder theCredit Facilityis basedon, atthe Company’selection,either theAdjustedTermSOFR
Rate plusthe ApplicableMarginor the BaseRate plus theApplicableMargin.The“Adjusted TermSOFR”meanswith respect
to anytenor, theper annumrate equalto thesum of(i)TermSOFR as definedin the Credit Agreementplus (ii)
0.10
% (10 basis
points);provided, ifAdjustedTermSOFR determinedas providedaboveshall everbe lessthanthe Floor,thenAdjusted Term
SOFR shallbe deemed to be the Floor.The “Floor” meansthe rate per annumof interest equal to
0.00
%. The “BaseRate” means
a fluctuatingrate perannumequal to the highest of (a)the federal fundsrate plus
0.50
% per annum,(b) the prime rate of interest
establishedby theAdministrativeAgent, and(c) theAdjustedTermSOFR fora
one
-month tenorplus
1.00
%. The“Applicable
Margin”means
0.00
% to
0.75
% per annumfor Base RateLoans and
1.00
% to
1.75
% per annumfor SOFRLoans, ineach case
dependingupon theTotal FundedDebtto CapitalizationRatio for the Companyat the quarterly pricing date.The Companywill
pay a commitmentfee on the unused portion of the CreditFacility payablequarterly from
0.15
% to
0.25
%, ineach case depending
uponthe TotalFundedDebt to CapitalizationRatiofor theCompanyatthe quarterlypricing date.
OnMarch25, 2025,the Companyenteredinto theSecondAmendment(the “SecondAmendment”)totheCredit Agreement.
UndertheCredit Agreement,aChangeofControlis aneventof default.TheSecondAmendmentamendedthe definitionof
ChangeofControlto excludefromthatdefinition theconversion(the“ClassAConversion”)ofall outstandingsharesof the
Company’sClass A CommonStock intoCommonStock which occurredon April 14, 2025.
The Credit Facility is guaranteedby substantially all the current and futurewholly-owned directand indirect domesticsubsidiaries
oftheCompany(the“Guarantors”),andissecuredbyafirst-priorityperfectedsecurityinterestinsubstantiallyallofthe
Company’sand the Guarantors’ accounts, paymentintangibles, instruments (including promissory notes),chattel paper,inventory
(including farmproducts)anddeposit accountsmaintainedwith the AdministrativeAgent.
TheCredit Agreementcontainscustomarycovenants,including restrictionson theincurrenceof liens,incurrenceof additiona
l
debt, salesof assetsandother fundamentalcorporatechanges andinvestments.The Credit Agreementrequiresmaintenanceof
62
two financialcovenants:(i) a maximumTotal FundedDebtto CapitalizationRatio testedquarterly ofno greaterthan
50
%; and
(ii) a requirementto maintainMinimum TangibleNet Worthat all timesof $
700
Millionplus
50
% of net income (ifnet income
ispositive)lesspermittedrestrictedpaymentsforeachfiscalquarterafterNovember27,2021.TheCreditAgreementalso
includescustomaryevents of defaultand customaryremedies upon theoccurrenceof an eventof default, includingacceleration
of theamountsdue underthe Credit Facility andforeclosure ofthe collateralsecuring the Credit Facility.
Further,under thetermsof theCreditAgreement,paymentof dividendsunder theCompany’s current dividendpolicy ofone-
third of theCompany’s net income,computedin accordancewithGAAP,and paymentof other dividends orrepurchasesby the
Companyof its capitalstock is allowed,as longas aftergiving effectto suchdividendpaymentsor repurchasesno defaulthas
occurred andis continuingand the sumof cashand cashequivalentsof the Companyand its subsidiariesplus availabilityunder
the Credit Facilityequalsatleast $
50
million.
At May30, 2026,we were in compliancewith the covenantrequirementsof theCredit Agreement.
Note
11
- Equity
On April14, 2025,all
4.8
million sharesof ClassACommonStock wereconvertedintoCommonStock. Uponthe conversion
of theClass A Stock, theCompanywas no longer acontrolled companyunder therules of The NasdaqStock Market.
On February25, 2025,the Boardapproved
a
$
500
millionshare repurchaseprogram.The sharerepurchaseprogramauthorizes
the Company,inmanagement’sdiscretion, to repurchaseCommonStock from time to time for anaggregate purchaseprice up to
$
500
million(exclusiveofanyfees,taxes,commissionsorotherexpensesrelatedtosuchrepurchases),subjecttomarket
conditionsand otherfactors. Theactualtiming, numberand valueof sharesrepurchasedunder theprogramwillbe determined
by managementin its discretionandwill dependon anumberoffactors,including,but notlimited to,themarketprice ofthe
CommonStock andgeneral marketandeconomicconditions.
The Companyrepurchased
1,571,950
and
551,876
shares during fiscal2026 and2025, respectively,under theshare repurchase
program.As of May30, 2026, theCompanyhad remaining authorizationto purchase up to$
320.7
million underthe repurchase
program.
Authorizedpreferredstockconsistsof
10,000,000
shares,withaparvalueof$
0.01
,ofwhich
no
shareswereissuedand
outstandingas ofMay30, 2026andMay31, 2025.
Note 12- Net Income perCommonShare
Basic net income pershare attributableto Cal-MaineFoods, Inc. is basedon the weighted averageshares of CommonStock (and
when they were outstanding,shares of Class ACommonStock) outstanding. All shares of Class A CommonStock wereconverted
into CommonStock on April 14, 2025.Dilutednet incomeper share attributableto Cal-MaineFoods, Inc.is based onweighted-
averageCommonStock outstandingduring the relevantperiod adjustedfor thedilutive effectof share-basedawards.
63
The followingtable provides a reconciliationof the numeratorsand denominatorsused to determine basic anddiluted net income
per commonshare attributableto Cal-MaineFoods, Inc.(amountsin thousands,exceptper sharedata):
May30, 2026
May31, 2025
June 1, 2024
Numerator
Net income
$
318,112
$
1,218,232
$
276,282
Less: Net income(loss) attributableto noncontrollinginterest
1,430
(1,816)
(1,606)
Net incomeattributableto Cal-Maine Foods,Inc.
$
316,682
$
1,220,048
$
277,888
Denominator
Weighted-averagecommonshares outstanding,basic
47,650
48,719
48,717
Effectof dilutive securitiesof restrictedshares
131
172
156
Weighted-averagecommonshares outstanding,diluted
47,781
48,891
48,873
Net incomeper commonshare attributableto Cal-Maine Foods,Inc.
Basic
$
6.65
$
25.04
$
5.70
Diluted
$
6.63
$
24.95
$
5.69
Note 13– Stock-BasedCompensation
TheCompany’sstock-basedcompensationplan,the Amendedand RestatedCal-Maine Foods,Inc. 2012Omnibus Long-Term
IncentivePlan (the“LTIPPlan”),providesforthe grantingof equity-basedawardssuch asrestrictedstock,performancestock
units andstock options.Awardsmaybe granted underthe LTIPPlan to any employee,any non-employee memberof the Board,
andanyconsultantwhois anaturalpersonandprovidesservices tous oroneofoursubsidiaries(exceptforincentivestock
options,which maybe grantedonlyto ouremployees).As ofMay30,2026,the totalnumberof sharesavailablefor issuance
was
719,234
, andmaybe authorizedbut unissuedshares ortreasuryshares. CommonStock issuedfromtreasuryshares under
the planwas
89,867
shares,
47,700
shares and
86,803
shares forfiscal 2026,2025and2024,respectively.
RestrictedStock
Restrictedstockoutstandingunder theLTIPPlanvests
three years
fromthe grantdate,or upondeathor disability,changein
control, orretirement(subject to certainrequirements).The restrictedstock containsno other serviceor performanceconditions.
Restrictedstock isawardedin thenameof therecipient and,exceptfor theright ofdisposal, constitutesissued andoutstanding
shares of theCompany’sCommonStock forall corporatepurposesduring the period ofrestriction including the right to receive
dividends. Compensationexpense is a fixed amountbased on the grant date closing price and is amortizedon a straight-line basis
over thevesting period.Forfeituresare recognizedas theyoccur.
Totalstock-basedcompensationexpense related tothe restrictedstock was$
5.3
million,$
4.5
million and$
4.4
million infiscal
2026,2025and2024,respectively.
Our unrecognizedcompensationexpense asa resultof non-vestedshares was$
9.0
million atMay 30,2026and $
8.0
million at
May31, 2025.Theunrecognizedcompensationexpensewillbeamortizedto stockcompensationexpenseover aperiod
of
2.1
years.
64
A summaryof ouractivityandrelatedinformationfor our restrictedstock is as follows:
Number of
Shares
WeightedAverageGrant
Date Fair Value
Outstanding,June 1, 2024
277,954
$
49.38
Granted
47,700
109.97
Vested
(108,058)
41.32
Forfeited
(4,879)
54.86
Outstanding,May31, 2025
212,717
$
66.93
Granted
89,867
76.47
Vested
(88,519)
55.61
Forfeited
(5,063)
83.85
Outstanding,May30, 2026
209,002
$
75.42
Performance-BasedLong-TermIncentiveAwards
EffectiveJune1, 2025,theCompanyimplementeda newperformance-based long-termincentiveawardunderourexecutive
compensationprogram,which providesforawardsof performanceshare units(“PSUs”)to certainkeyexecutives.Pursuantto
these awards,certainofficers havethe opportunityto receiveCommonShares aftera three-yearperformanceperiod contingent
on (a)the executive’scontinuedservicethrough theperformanceperiod, exceptas otherwiseprovidedin theaward agreement,
and(b)theCompany’sachievementof specificperformancegoals tiedtothefollowingtwo equallyweightedmeasures:the
Company’scumulativeadjustedEBITDA and relative total stockholderreturn comparedto a peer group. Dependingon the level
of achievementof these twomeasuresoverthe performanceperiod, the PSUswill payout between
0
% and
150
% of thetarget
award.
Totalcompensationexpenseas aresult of theperformance-basedprogramwas $
387
thousandin fiscal 2026.
Our unrecognizedcompensationexpense as a resultof non-vestedshares inthe performance-basedprogram was $
779
thousand
at May 30, 2026.The unrecognized compensationexpense will be amortizedto stock compensationexpense over a period
of
2.0
years.
A summaryof ouractivityandrelatedinformationfor ourperformance-basedawardsis as follows:
Number of
Shares
WeightedAverageGrant
Date Fair Value
Outstanding,May31, 2025
—
$
—
Granted
9,260
101.95
Outstanding,May30, 2026
9,260
$
101.95
65
Note 14- Income Taxes
IncomeTaxProvision
The componentsof ourincometaxprovision (benefit)were (in thousands):
Fiscal yearended
May30, 2026
May31, 2025
June 1, 2024
Current:
Federal
$
29,749
$
312,000
$
83,721
State
(4,220)
61,340
9,640
25,529
373,340
93,361
Deferred:
Federal
59,739
12,703
(7,371)
State
7,624
(1,133)
(2,301)
67,363
11,570
(9,672)
Totalincometaxprovision
$
92,892
$
384,910
$
83,689
Deferred Taxes
The taxeffectsof significanttemporarydifferencescreating deferredtaxassetsandliabilitieswere (in thousands):
May30, 2026
May31, 2025
Deferredtaxassets:
Accruedexpenses
$
3,985
$
3,620
Stateoperatingloss carryforwards
2
6
Other comprehensiveincome
913
770
Right ofuse - asset
3,334
234
Other
12,969
13,239
Totaldeferredtaxassets
21,203
17,869
Deferredtaxliabilities:
Property,plantandequipment
$
(180,377)
$
(128,789)
Inventories
(49,478)
(35,041)
Investmentin affiliates
(1,618)
(2,205)
Right ofuse - liability
(3,358)
(240)
Other
(8,244)
(6,245)
Totaldeferredtaxliabilities
(243,075)
(172,520)
Net deferredtaxliabilities
$
(221,872)
$
(154,651)
The companyhad income taxnet operating loss carryforwardsrelated to itsstate operationsof approximately$
96
thousand as of
May30, 2026.The loss carryforwardsare notsubjectto expiration.
On July 4, 2025,H.R. 1, informally knownas the One Big BeautifulBill Act ("The TaxAct"), was enacted.The Tax Act extends
and makespermanentseveral keyprovisions ofthe TaxCuts andJobs Act of2017previously set toexpire as ofDecember31,
2025. The impactsof the Tax Act arereflected in ourresults forthe year ended May30, 2026,and hadno material impacton our
incometaxexpenseor effectivetaxrate.
Reconciliationof the U.S. FederalStatutory Rateto theEffectiveRate
TheCompanyhaselectedtoprospectivelyadopttheguidancein ASU 2023-09,
IncomeTaxes(Topic740):Improvementsto
IncomeTaxesDisclosures
. Thefollowing tableis areconciliationof theU.S. federalstatutorytax rateto thetotaleffectivetax
rates forthe yearendedMay30, 2026in accordancewith the guidancein ASU2023-09(in thousands):
66
Fiscal yearend May30, 2026
Amount
Percent
U.S. federalstatutorytaxrate
$
86,226
21.0
%
Stateandlocal incometaxes*
4,290
1.1
Taxcredits
(251)
(0.1)
Nontaxableor nondeductibleitems
2,627
0.7
Provision forincometaxes
$
92,892
22.7
%
*State taxesinGeorgia, Florida,Mississippi, andTexasmade up the majority (greater than50%) of the tax effectinthis category.
The followingtableis a reconciliationof the
U.S.
federal statutorytax rate to thetotal effectivetax rate forthe yearsended May
31, 2025andJune 1, 2024in accordancewith guidanceprior to the adoptionof ASU 2023-09(in thousands):
Fiscal yearend
May31, 2025
June 1, 2024
Statutoryfederalincometax
$
337,042
$
75,931
Stateincometaxes,net
47,169
5,798
Other,net
699
1,960
$
384,910
$
83,689
IncomeTaxPayments
The followingtable is a summaryof income taxespaid (net of refunds) by jurisdictionpursuantto the disclosure requirementsof
ASU 2023-09for theyearendedMay30, 2026(in thousands):
Fiscal yearend
May30, 2026
Federal
$
89,583
State
30,344
Incometaxpayments
$
119,927
Wepaidincometaxes, netof refunds,of $
119.9
million, $
426.2
million, and$
35.1
million duringfiscalyears 2026,2025,and
2024,respectively.
As of May30, 2026,we had
no
significant unrecognizedtax benefits.Weaccruedand paid
no
interest or penaltiesduring2026
or 2025relatedto uncertaintaxpositions.
Weare subjectto incometaxin manyjurisdictionswithinthe U.S.Wearecurrentlynotunderauditby theInternalRevenue
Serviceorbyanystateandlocaltaxauthorities.Taxperiodsforallyearsbeginningwithfiscalyear2021remainopento
examinationby federalandstatetaxing jurisdictionsto which we are subject.
Note 15– SegmentReporting
The Companypreviously manageditsbusinessas
one
operatingand reportablesegment.Effectivein thefourth quarterof 2026,
theCompanyrevised itsinternalreportingtochangethemannerin whichitsbusinessis managed,which reflectsafocuson
managingoperationsbased onthe Company’sproduct categoriesratherthanon aconsolidatedbasis.As a result,the Company
identifiedthreereportablesegments:ConventionalShellEggs,SpecialtyShellEggs,andPreparedFoods.TheCompany’s
remainingoperations,whichincludeco-packshell eggs,egg products,hard-cookedeggs andotherbusinessactivities,are not
reportable segments,as defined bythe applicable accountingstandard.Allprior fiscal yearperiodshave beenrecast to reflect the
new reportablesegments.
ConventionalShell Eggs
TheConventionalShellEggssegmentconsistsprimarilyoftheproduction,grading,packaging,marketingand
distributionof shell eggssold as conventionalshell eggs, which includes ourbrands
Sunups®
and
Sunny Meadow®.
67
SpecialtyShell Eggs
The SpecialtyShell Eggssegmentconsistsprimarilyof the production,grading,packaging, marketingand distribution
of shell eggs sold as cage-free, nutritionallyenhanced,organic, brown, pasture-raised and free-rangeeggs. This segment
includesourbrands
FarmhouseEggs
® and
4Grain®
as wellasbrandedproductsfromour membershipof Eggland’s
Best, Inc. cooperativewhich includes
Egg-Land’sBest®
and
Land O’ Lakes®.
PreparedFoods
ThePreparedFoodssegmentconsistsprimarilyof theproduction,packaging,marketinganddistributionofprepared
foodsofferingssuchaspre-cookedeggpatties,omelets,foldedandscrambledeggformats,pancakes,waffles,and
specialtywraps.This segmentincludesour brands
Van’s®
and
Crepini®.
The Company’soperating segmentsare determinedon thebasis of our organizationalstructure andinformationthatis regularly
reviewedby our ChiefOperatingDecisionMaker(“CODM”).The Company’sCODMis ShermanMiller,Presidentand Chief
ExecutiveOfficer.Segmentincomeisutilizedduringourforecastingprocesstoassessprofitability,strategicinitiativesand
capitalinvestments.TheCODMprimarilycomparesactualperformanceof segmentsales andsegmentincometoprior period
results andperiodic forecaststo assist with assessingperformanceanddeciding how to allocateresources.
The accountingpolicies of the segments are generally the sameas those presented in
Segment SG&A representsdirect costsassociatedwitheach segmentfor
mar
keting, delivery and employeecosts.Other
– segmentincomerepresentsthe totalsegmentincomefrom otheroperatingsegmentssuchas co-packshell egg,egg products,
hard-cookedeggs andother businessactivitiesthatdo notindividuallymeetthe quantitativethresholds forseparatedisclosure.
UnallocatedCorporateSG&Arepresentsoverheadsuchascorporatepayrollrelatedexpenses,legalandprofessionalfees,
amortizationandother expensesthatare notused tomeasuresegmentincomeandis managedatthe corporateoffice.
Intersegmentsales representsales between segmentsas part of our vertical integration.Intersegmentsales from the Conventional
andSpecialtyShellEggsegmentsareprimarilysalesrelatedtoournon-reportableeggproductsorhard-cookedsegments.
Conventionaland SpecialtyShell Egg intersegmentsales are transferredat discountedfixed ratesto accountfor undergrades and
yield loss,marketrates, or atproductioncosts.
The Companydoes not report total assets by segment as operationsare highlyintegrated,and assetsare shared amongstsegments.
The CODM doesnot assessperformanceor allocateresources basedon segmentassets.
Segment results, includingthe significant expensecategories regularly providedto the CODM, are provided below (in thousand
s):
Fiscal yearendedMay30, 2026
Conventional
Shell Eggs
SpecialtyShell
Eggs
PreparedFoods
TotalReportable
Segments
Net sales- externalcustomers
$
1,309,557
$
1,049,228
$
244,802
$
2,603,587
Intersegmentsales
38,519
21,230
—
59,749
Totalsegmentsales
1,348,076
1,070,458
244,802
2,663,336
Segment COGS
1,059,179
777,920
185,370
2,022,469
Segment SG&A
72,256
110,994
25,550
208,800
Segment income
$
216,641
$
181,544
$
33,882
$
432,067
Other - segmentincome
19,044
UnallocatedcorporateSG&A
(108,353)
Gain on involuntaryconversions
8,819
Loss ondisposal offixed assets
(1,391)
Operatingincome
350,186
Other income,net
60,818
Incomebeforeincometaxes
$
411,004
68
Fiscal yearendedMay31, 2025
Conventional
Shell Eggs
SpecialtyShell
Eggs
PreparedFoods
TotalReportable
Segments
Net sales- externalcustomers
$
2,703,502
$
1,126,601
$
4,050
$
3,834,153
Intersegmentsales
52,357
28,350
—
80,707
Totalsegmentsales
2,755,859
1,154,951
4,050
3,914,860
Segment COGS
1,393,212
717,411
4,511
2,115,134
Segment SG&A
72,644
103,938
1,658
178,240
Segment income
$
1,290,003
$
333,602
$
(2,119)
$
1,621,486
Other - segmentincome
42,091
UnallocatedcorporateSG&A
(127,141)
Loss oninvoluntaryconversions
(156)
Gain on disposalof fixedassets
259
Operatingincome
1,536,539
Other income,net
66,603
Incomebeforeincometaxes
$
1,603,142
Fiscal yearendedJune 1, 2024
Conventional
Shell Eggs
SpecialtyShell
Eggs
TotalReportable
Segments
Net sales- externalcustomers
$
1,226,903
$
863,297
$
2,090,200
Intersegmentsales
20,389
10,322
30,711
Totalsegmentsales
1,247,292
873,619
2,120,911
Segment COGS
970,031
648,236
1,618,267
Segment SG&A
63,560
89,188
152,748
Segment income
$
213,701
$
136,195
$
349,896
Other - segmentincome
33,566
UnallocatedcorporateSG&A
(94,516)
Gain on involuntaryconversions
23,532
Loss ondisposal offixed assets
(26)
Operatingincome
312,452
Other income,net
47,519
Incomebeforeincometaxes
$
359,971
The followingtableshows the reconciliationof netsales to consolidatedresults (in thousands):
Fiscal YearEnded
May30, 2026
May31, 2025
June 1, 2024
Totalreportablesegments
$
2,603,587
$
3,834,153
$
2,090,200
Other - segmentsales
308,045
427,732
236,243
Totalconsolidatednet sales
$
2,911,632
$
4,261,885
$
2,326,443
Other– segmentsalesrepresentsalesfromournon-reportablesegmentswhichincludesco-packshell eggsales,eggproduct
sales, hard-cookedeggs and otherbusiness activities.
69
Revenue primarilyderives fromsalesthroughoutthe U.S.The followingtableprovidesrevenuedisaggregatedby segmentand
by sales channel(in thousands):
Fiscal yearMay30, 2026
Retail
Foodservice
Other
Total
ConventionalShell Egg
$
1,099,245
$
193,614
$
16,698
$
1,309,557
SpecialtyShell Egg
952,556
92,343
4,329
1,049,228
PreparedFoods
92,031
104,157
48,614
244,802
Other - segmentsales
245,415
60,269
2,361
308,045
$
2,389,247
$
450,383
$
72,002
$
2,911,632
Fiscal yearMay31, 2025
Retail
Foodservice
Other
Total
ConventionalShell Egg
$
2,247,913
$
424,133
$
31,456
$
2,703,502
SpecialtyShell Egg
1,022,253
98,508
5,840
1,126,601
PreparedFoods
4,050
—
—
4,050
Other - segmentsales
337,489
89,347
896
427,732
$
3,611,705
$
611,988
$
38,192
$
4,261,885
Fiscal yearJune 1, 2024
Retail
Foodservice
Other
Total
ConventionalShell Egg
$
1,007,282
$
210,423
$
9,198
$
1,226,903
SpecialtyShell Egg
835,826
25,879
1,592
863,297
Other - segmentsales
198,943
36,972
328
236,243
$
2,042,051
$
273,274
$
11,118
$
2,326,443
Retail customersincludeprimarilynationaland regional grocerystore chains,clubstores, andcompaniesservicing independent
supermarketsintheU.S.Foodservicecustomersincludeprimarilycompaniesthatsellfoodproductsandrelateditemsto
restaurants, healthcareandeducationfacilities andhotels.
Our largestcustomer,WalmartInc. (includingSam’s Club)accountedfor
30.0
%,
33.6
% and
34.0
% of net sales dollarsfor fiscal
2026,2025,and2024,respectively.
Note 16- Commitmentsand Contingencies
In re ShellEggs Litigation
SinceNovember2025,theCompanyhasbeennamedasadefendantinseverallawsuitsfiledinfederalcourtsalleging
substantiallyidentical claims,including:(1) thefollowing lawsuitsin theSouthernDistrict ofIndiana:(a) King KullenGrocery
Co., Inc. v. Cal-Maine Foods, Inc.,et al., Case No. 1:25-cv-2274, (b) NineteenseventynineLLC d/b/aThe BreakfastJoynt v. Cal-
MaineFoods, Inc.,etal., CaseNo. 1:25-cv-2301, (c)TaylorEgg Products,Inc. v.Cal-Maine Foods,Inc., etal., CaseNo. 1:25-
cv-2554,(d) Hudsonv.Cal-Maine Foods,Inc. et al.,CaseNo. 1:25-cv-02573, (e) BrandonHuyler v.Cal-Maine Foods,Inc.,et
al., Case No. 1:26-cv-00135, and(f) GloriaEmery,Carol Goldberg,and CaseyWhalen v. Cal-Maine Foods, Inc.,et al., Case No.
1:26-cv-00135;(2) thefollowinglawsuitsin theNorthernDistrictofIllinois: (a)BirchmansParisian,LLC (d/b/aLisciandro's
Restaurant)v. Cal-Maine Foods,Inc.,et al., CaseNo.1:25-cv-14030, (b)Phil-N-Cindy'sLunch,Inc. v.Cal-Maine Foods,Inc.,
et al., CaseNo. 1:25-cv-14082, (c) Yell-O-GlowCorporationv.Cal-Maine Foods,Inc., etal., CaseNo. 1:25-cv-15084, and(d)
TariqHabash,Delia Govea, AndrewPhillips,andCatalinaTorres v.UrnerBarryPublications,Inc.,Cal-Maine Foods,Inc.,et
al., CaseNo.1:25-cv-14112;(3) the followinglawsuitsin theWesternDistrictof Wisconsin:(a) MatthewEdlin v.Cal-Maine
Foods, Inc.,et al., Case No. 3:25-cv-946, and (b) India Price, Lakia Session,and Karen Solomonv. Cal-Maine Foods,Inc., et al.,
CaseNo.3:25-cv-1016;and (4)
a
lawsuit inthe WesternDistrictof Missouri:Ryanv. Cal-Maine Foods,Inc.,et al.,CaseNo.
4:25-cv-00999.ThelawsuitsgenerallyallegethattheCompany,alongwithothereggproducersandindustryassociations,
conspired to artificiallyinflate the prices ofconventionalshell eggs nationwide, primarilythrough manipulationof industry price
benchmarks(such asthe UrnerBarryEgg IndexandEggs Clearinghouse,Inc. spotmarket),coordinatedreporting andsupply
restrictions,particularlyduringthe calendaryear2022highly pathogenicavianinfluenza(“HPAI”)outbreak.In eachcase, the
plaintiffseekscertificationofaputativeclassofeitherdirectorindirectpurchasers,monetarydamages,injunctiverelief,
attorneys’fees, and, in some cases, restitution under Section 1 of the ShermanAct, 15 U.S.C. § 1 (the “Sherman Act”) and various
stateantitrustandconsumerprotectionstatutes.
70
On February10, 2026,theJointPanel onMultidistrictLitigationissued aTransferOrder,consolidatingthe aboveactions and
transferringthem to the WesternDistrict of Wisconsinfor pre-trial proceedings.An initial judicialmanagementconference took
placeon May8,2026,wherethe courtenteredaninitialcasemanagementorder, settingforthdeadlinesfortheconsolidated
complaintsand initialbriefingto be filed.No discoveryhas takenplace in any ofthe actions.The Companydisputes plaintiffs’
allegationsin eachof theseactionsandintends tovigorously defenditself in these actions.
Civil InvestigativeDemand
In March2025,the Companyreceived aCivil InvestigativeDemand(“CID”) fromtheU.S. DepartmentofJustice(“DOJ”) in
connectionwithanantitrustinvestigationtodeterminewhethertherewasaviolationoftheantitrustlawsthroughalleged
anticompetitiveconductby and among egg producers.In August 2025,the Companyreceived a subpoenafrom the State of New
Yorkrequesting informationand documentsrelated to its investigationof anticompetitiveconductandhigh eggprices in the egg
industry,and inMarch 2026, theCompanyreceived a similar subpoenafrom the State of Washingtonrelatedto its investigation
of anticompetitiveconductand high egg pricesin the eggindustry.Additionally,variousstates’attorneysgeneral soughtto join
the DOJ’sinvestigationor requestedaccessto theconfidentialdisclosures by theCompanyto theDOJ.
On or aboutJune 25, 2026,the Companyentered into anagreementwith the DOJand 17states’ attorneysgeneral to resolvethe
investigation,subject to applicablecourt approvalsand procedures.The Companydenied all wrongdoing or violations of law and
no finesor penaltieswere assessedagainstthe Company.In connectionwiththe agreement,the Companyagreed to implement
certainantitrustcomplianceandreportingmeasures,to donate
30
million eggsto foodbanksandnon-profits,andto pay$
1.5
million tothe settlingstatesto resolve thematter.
TheStateof Washingtondid notjoininthis settlementandthe Companycontinues tocomplywith theStateof Washington’s
subpoenaand cooperatewithits investigations.Managementcannot predict the eventualscope, duration or outcomeof the State
of Washington’sinvestigationandis unable toestimatethe amountor range ofpotentiallosses, if any,atthis time.
Kraft FoodsGlobal, Inc.et al. v.United EggProducers,Inc. et al.
On September25,2008,theCompanywas namedas oneof severaldefendantsin numerousantitrustcasesinvolving theU.S.
shelleggindustry.TheCompanysettled allofthesecases,exceptfortheclaimsof certainplaintiffswhosoughtsubstantia
l
damagesallegedly arising from the purchaseof egg products (as opposed to shell eggs). These remainingplaintiffs are Kraft Food
Global,Inc.,GeneralMills, Inc.,andNestleUSA,Inc. (the“Egg ProductsPlaintiffs”)and,untila subsequentsettlementwas
reachedas describedbelow, The KelloggCompany.
On September13, 2019, the case withthe Egg ProductsPlaintiffs was remandedfroma multi-district litigation proceeding in the
United States DistrictCourt for the EasternDistrict of Pennsylvania,In re Processed Egg ProductsAntitrust Litigation,MDLNo.
2002,totheUnitedStatesDistrictCourtfortheNorthernDistrictofIllinois,KraftFoodsGlobal,Inc.etal.v.UnitedEgg
Producers, Inc. et al., Case No. 1:11-cv-8808, for trial.The Egg Products Plaintiffsalleged thatthe Companyand other defendants
violatedSection1 of theShermanAct, byagreeingto limitthe productionof eggsandtherebyillegally toraise thepricesthat
plaintiffspaidfor processedegg products.In particular,the EggProducts Plaintiffsattackedcertainfeaturesof theUnitedEgg
Producersanimal-welfare guidelines andprogramused bythe Companyandmanyother egg producers.
On October24,2019, theCompanyentered into a confidentialsettlementagreementwith The KelloggCompanydismissing all
claimsagainst theCompanyfor an amountthat did nothave amaterial impactonthe Company’sfinancialconditionor results
ofoperations.OnNovember11,2019,astipulationfordismissalwasfiledwiththecourt,andon March28,2022,thecourt
dismissedthe Companywith prejudice.
The trialof this casebegan onOctober 17,2023. OnDecember1, 2023,the juryreturneda decisionawardingthe EggProducts
Plaintiffs$
17.8
millionin damages.On November6, 2024,the courtentereda finaljudgementagainst theCompanyand other
defendants,jointly and severally, totaling $
43.6
million after trebling. On December 4, 2024, the Companyfiled a renewedmotion
for judgmentas a matterof law or for a new trial, anda motion to alter or amendthe judgment. On December13, 2024, thecourt
granteddefendants’November20, 2024motion tostay enforcementof thejudgmentandenteredanagreed orderrequiring the
defendantsto post security duringpost-judgmentproceedingsand appeal,and stayedproceedings toenforcethe judgmentuntil
the dispositionof thepost-judgmentmotionsandultimateappeals. OnDecember17, 2024,the Companyposteda bondin the
approximateamountof $
23.9
million, representinga portionof thetotalbondrequiredto preservetheright toappealthe trial
court’sdecision. Another defendantposted a bond for the remaining amount.On November 19, 2025, the plaintiffs fileda motion
to lift stay of proceedings onattorney’sfees and costs, and on December5, 2025, the defendantsfiled theirresponse in opposition
to such motion. The court hasnot ruled on this motion. The Companyintends to continue to vigorously defendthe claims asserted
by theEgg Products Plaintiffs.
71
If thejury’sdecisionis ultimatelyupheld,the Companywould bejointlyandseverallyliablewithother defendantsfor treble
damages,or$
43.6
million,subjecttocreditforcertainsettlementswithprevioussettlingdefendants,plustheEggProduct
Plaintiffs’ reasonableattorneys’fees. During our secondquarter of fiscal2024, we recordedan accruedexpense of $
19.6
million
in selling,generaland administrativeexpenses inthe Company’sCondensedConsolidatedStatementsof Incomeand classified
as other noncurrentliabilitiesin the Company’sCondensedConsolidatedBalance Sheets. Although lessthanthe bond postedby
theCompany,theaccrualrepresentsourestimateoftheCompany’sproportionalshareofthereasonablypossibleultimate
damagesaward, excluding the Egg Product Plaintiffs’ attorneys’fees that we believe would be approximatelyoffsetby the credits
noted above.We haveentered into a judgmentallocationand joint defenseagreementwith the other defendantsremaining in the
case. Ouraccrualmaychangein the futureto theextentwe are successfulin further proceedingsin the litigation.
State ofOklahoma WatershedPollution Litigation
On June18,2005,the Stateof Oklahomafiled suit,in theUnitedStatesDistrictCourt forthe NorthernDistrictof Oklahoma,
against Cal-Maine Foods, Inc. andTyson Foods,Inc., Cobb-Vantress,Inc., Cargill, Inc., George’s,Inc., PetersonFarms, Inc. and
SimmonsFoods, Inc.,and certainof their affiliates.The State of Oklahomaclaims thatthrough the disposalof chickenlitter the
defendantspollutedtheIllinois RiverWatershed.ThiswatershedprovideswatertoeasternOklahoma.Thecomplaintsought
injunctiverelief and monetarydamages, but the claimfor monetarydamages was dismissedby the court.Cal-Maine Foods,Inc.
discontinuedoperationsin thewatershedin oraround2005.Since thelitigationbegan,Cal-MaineFoods, Inc.purchased
100
%
of the membershipinterests of Benton CountyFoods, LLC,which is an ongoing commercial shell egg operationwithin the Illinois
RiverWatershed.BentonCountyFoods,LLCisnotadefendantinthelitigation.Wealsohaveanumberofsmallcontract
producersthatoperatein the area.
The non-jurytrial inthe case beganin September2009 andconcluded inFebruary 2010.On January18, 2023, the courtentered
findings offact andconclusionsof lawin favorof theState ofOklahoma.The courtfoundthe defendantsjointly and severally
liable for statelaw nuisance, federal commonlaw nuisance, and statelaw trespass. The court also found the producersvicariously
liablefor theactionsof theircontractproducers. OnJune12, 2023,thecourt orderedthe partiesto mediate,but themediation
was unsuccessful.On June26, 2024, thedistrictcourt denieddefendants’motion to dismissthe case.On September13, 2024,
a
statushearingwasheldandthe courtscheduledanevidentiaryhearingforDecember3,2024,to determinewhetheranylegal
remedy is availablebased on the now 15-year-old record and changed circumstancesof the IllinoisRiver watershed. On December
9, 2025,the courtentereda final judgmentimposingapproximately$
420,000
in total penaltiesfor alldefendantsand awarding
certain non-monetaryremedies, including injunctiverelief. Pursuantto the finaljudgment,the Companyisto payapproximately
$
70,000
in penalties.The judgmentalso entitlesthe Stateof Oklahomato an awardof attorneys’fees andcosts inan amountto
be determinedata laterdate.
Theinjunctiverelief providesfor,amongother things,a specialmaster tooverseean investigation,developa remediationplan
subjectto courtapproval,andprovide ongoingmonitoringof remediationprojects,thecostsof whichwillbepaidjointlyand
severally bythe defendants.The defendantsare required to fund $
10
million within
5 days
of appointmentof the special master,
andongoing fundingrequirementsof $
5
million anytime thefundis below $
5
million. Thisfunding obligationis expectedto
continue for the
30 years
term. The defendantsare indiscussions of a potential expensesharing agreement;however, the Company
doesnot currentlyexpecttohavea materialshareofthefunding.Theinjunctiverelief alsoincludescertainannualreporting
requirementsand certainrequirementson futureoperationswithinthe IllinoisRiver Watershed,includingrelating toremovalof
litter,storage, transportation,disposal andfuturelandapplications.
On January2, 2026, the Company filed itsnotice of appealto the United States Court of Appeals for the Tenth Circuit. On January
16, 2026,the districtcourt stayedthe monetaryportions of thejudgementbut declinedto staythe injunctiveportions. Effective
July 10, 2026, the Companyand allother defendantsentered into a settlement agreementwiththe State of Oklahomathat provides
forthe paymentof fundsby thedefendantsinto anenvironmentalrelief fund,certainrestrictionson theapplicationofchicken
litter in the IRWand certainreporting andreporting measures.The agreementremains subjectto applicable court approvalsand
proceduresandis not expectedto havea materialimpacton theCompany’sfinancialconditionor results of operations.
Other Matters
In additionto theabove,the Companyis involvedin variousother claimsand litigationincidentalto itsbusiness.Althoughthe
outcomeof these matterscannotbe determined with certainty, management,upon the adviceof counsel, is of the opinion thatthe
final outcomeshould nothavea materialeffecton theCompany’sconsolidatedresults of operationsor financialposition.
Note 17– SubsequentEvents
Effective
July 10, 2026
, theCompanyacquiredtheEggland’sBest®franchiseterritory intheNortheastfor$
25
million. The
acquisitiongives usthe exclusiveright todistributeandsell
Egg-Land’sBest®
and
Land O’Lakes®
brandedeggs inMaine,
Massachusetts,New Hampshire,RhodeIsland,andselect key areasin Vermont,New York, andConnecticut.
72
ITEM9.CHANGESIN ANDDISAGREEMENTSWITHACCOUNTANTSONACCOUNTINGANDFINANCIAL
DISCLOSURE
None.
ITEM 9A.CONTROLSANDPROCEDURES
DisclosureControlsand Procedures
Our disclosurecontrols andprocedures are designedto provide reasonableassurancethat informationrequired to bedisclosedby
us inthe reportswefileorsubmitunderthe SecuritiesExchangeAct of1934,as amended(the “ExchangeAct”) is recorded,
processed,summarizedand reported,withinthetime periodsspecifiedin theSecuritiesand ExchangeCommission’srulesand
forms. Disclosurecontrolsandproceduresinclude,withoutlimitation,controlsandproceduresdesignedtoensurethat
informationrequiredtobedisclosedbyusinthereportsthatwefileor submitundertheExchangeActisaccumulatedand
communicatedto management,including ourprincipalexecutiveand principalfinancialofficers, orpersonsperforming similar
functions, as appropriateto allowtimely decisions regarding required disclosure.Based on an evaluationof our disclosurecontrols
and proceduresconductedby our Chief Executive Officer and ChiefFinancial Officer,together with other financialofficers, such
officersconcludedthatourdisclosurecontrolsandprocedureswereeffectiveasofMay30,2026atthereasonableassurance
level.
InternalControlOver FinancialReporting
(a)Management’sReporton Internal ControlOver FinancialReporting
Thefollowingsets forth,in accordancewith Section404(a)of theSarbanes-Oxley Actof 2002andItem308 ofthe Securities
andExchangeCommission’sRegulationS-K, the report ofmanagementon our internalcontrol overfinancialreporting.
1.
Our managementis responsible for establishingand maintainingadequateinternal control over financialreporting.
“Internalcontrol over financial reporting”is a process designed by,or under the supervisionof, our Chief Executive
Officerand ChiefFinancial Officer,together withother financialofficers, andeffectedby the Board,management
andotherpersonnel,toprovidereasonableassuranceregardingthereliabilityoffinancialreportingandthe
preparationoffinancialstatementsforexternalpurposesinaccordancewithgenerallyacceptedaccounting
principlesandincludes thosepolicies andproceduresthat:
●
Pertain tothe maintenanceof records that in reasonabledetail accuratelyand fairly reflect thetransactions
anddispositions ofour assets;
●
Provide reasonableassurancethat transactions are recorded as necessaryto permitpreparationof financial
statementsinaccordancewithgenerallyacceptedaccountingprinciples,andthatourreceiptsand
expenditures are beingmadeonly in accordancewithauthorizationsof our managementand directors; and
●
Provide reasonableassuranceregarding prevention ortimely detectionof unauthorizedacquisition, use or
dispositionof ourassetsthatcould havea materialeffecton thefinancialstatements.
2.Ourmanagement,in accordancewith Rule13a-15(c) undertheExchangeActandwiththeparticipationofour
ChiefExecutiveOfficerandChiefFinancialOfficer,togetherwithotherfinancialofficers,evaluatedthe
effectivenessofourinternalcontroloverfinancialreportingasofMay30,2026.Theframeworkonwhich
management’sevaluationofourinternalcontroloverfinancialreportingisbasedisthe“InternalControl–
IntegratedFramework”
publishedin2013bytheCommitteeofSponsoringOrganizations(“COSO”)ofthe
TreadwayCommission.
3.Managementhas determinedthat our internalcontrol overfinancial reportingas of May30, 2026is effective.It is
notedthatinternalcontroloverfinancialreportingcannotprovideabsoluteassuranceofachievingfinancial
reporting objectives,but ratherreasonableassuranceof achievingsuch objectives.
4.The attestationreport of FROST,PLLC onour internalcontrolover financialreporting, whichincludesthat firm’s
opinion onthe effectivenessof ourinternal controlover financialreporting, is set forth below.
(b)AttestationReportof the Registrant’sPublic AccountingFirm
73
Report ofIndependentRegisteredPublicAccounting Firm
on Internal ControlOver FinancialReporting
Boardof Directors andStockholders
Cal-Maine Foods,Inc. andSubsidiaries
Ridgeland,Mississippi
Opinion on InternalControlOverFinancialReporting
Wehave auditedCal-Maine Foods,Inc. andSubsidiaries’ internalcontrol overfinancial reportingas of May30, 2026,
basedoncriteriaestablishedin
2013InternalControl–IntegratedFramework
issuedbytheCommitteeofSponsoring
Organizationsof theTreadwayCommission(“COSO”).In ouropinion,Cal-Maine Foods,Inc. andSubsidiariesmaintained,in
all materialrespects,effectiveinternal controlover financialreportingas of May30, 2026,based oncriteria establishedin
2013
InternalControl– IntegratedFramework
issued by theCOSO.
As indicatedin the accompanyingChanges inInternal ControlOver FinancialReporting,management’sassessment of
and conclusionon the effectivenessof internal controlover financialreporting didnot include theinternal controlsof EchoLake
Foods,LLCandcertainrelatedcompanies,whichareincludedin theMay30,2026consolidatedfinancialstatementsof Cal-
MaineFoods,Inc. andSubsidiaries andconstituted9.7% oftotalassetsas ofMay30, 2026,and7.8% ofnet salesfor theyear
then ended.Our auditof internalcontrol overfinancial reportingof Cal-Maine Foods,Inc. andSubsidiaries also didnot include
anevaluationof theinternal controlover financialreporting of EchoLakesFoods, LLC andcertainrelatedcompanies.
Wealso haveaudited,in accordancewith the standardsof thePublicCompanyAccounting OversightBoard(United
States)(“PCAOB”),the consolidatedbalancesheets and therelatedconsolidatedstatementsof income, comprehensiveincome,
stockholders’equity,and cashflows ofCal-Maine Foods,Inc. andSubsidiaries andour report datedJuly 22,2026 expressed an
unqualifiedopinion.
Basis forOpinion
Cal-MaineFoods,Inc.andSubsidiaries’managementis responsibleformaintainingeffectiveinternalcontrolover
financialreporting,andfortheirassessmentoftheeffectivenessofinternalcontroloverfinancialreporting,includedinthe
accompanyingManagement’sReport on InternalControlOver FinancialReportingin Item 9A.Our responsibilityis to express
an opinion on the entities’ internalcontrol over financialreporting basedon our audit.We are a public accountingfirm registered
with thePCAOB andare requiredto be independentwith respectto Cal-Maine Foods,Inc. and Subsidiariesin accordancewith
theU.S.federalsecuritieslawsandtheapplicablerulesandregulationsoftheSecuritiesandExchangeCommissionandthe
PCAOB.
Weconductedour auditinaccordancewith thestandardsof thePCAOB.Thosestandardsrequire thatweplanand
perform the auditto obtain reasonableassuranceabout whether effectiveinternal control over financialreporting was maintained
inall materialrespects.Ourauditofinternalcontroloverfinancialreportingincludedobtaininganunderstandingofinternal
controloverfinancialreporting,assessingtheriskthata materialweaknessexists,andtestingandevaluatingthedesignand
operatingeffectivenessof internal controlbased onthe assessedrisk.Ouraudit also includedperforming suchother procedures
as we considerednecessaryin the circumstances.We believeour auditprovides areasonablebasis forour opinion.
Definition andLimitationsof Internal ControlOver FinancialReporting
An entities’ internalcontrol overfinancial reportingis a process designedto providereasonableassuranceregarding the
reliability of financialreporting andthe preparationof consolidated financial statementsfor external purposes in accordancewith
accountingprinciplesgenerallyacceptedin theUnitedStatesof America.Anentities’ internalcontrol overfinancial reporting
includesthose policiesandproceduresthat(1)pertaintothe maintenanceof recordsthat,in reasonabledetail,accuratelyand
fairly reflectthe transactionsand dispositionsof the assetsof theentities; (2)provide reasonableassurancethat transactionsare
recordedasnecessarytopermitpreparationofconsolidatedfinancialstatementsinaccordancewithaccountingprinciples
generallyacceptedin theUnitedStatesofAmerica,andthatreceiptsandexpendituresoftheentities arebeingmadeonlyin
accordancewithauthorizationsof managementanddirectorsoftheentities;and(3)providereasonableassuranceregarding
preventionor timelydetectionof unauthorizedacquisition,use, ordispositionof theentities’assetsthatcould havea material
effecton theconsolidatedfinancialstatements.
74
Becauseofitsinherentlimitations,internalcontroloverfinancialreportingmaynotpreventordetectmisstatements.Also
,
projections of anyevaluationof effectiveness to future periods are subject to the riskthat controls maybecome inadequatebecause
of changesin conditions, or thatthe degree ofcompliancewith the policies or proceduresmaydeteriorate.
/s/
Frost, PLLC
Little Rock, Arkansas
July 22,2026
(c)Changesin InternalControlOver FinancialReporting
Inconnectionwithitsevaluationoftheeffectiveness,asofMay30,2026,ofourinternalcontroloverfinancialreporting,
managementdetermined thatthere was no changein our internalcontrol overfinancial reportingthat occurredduring thefourth
quarterendedMay30, 2026,thathasmateriallyaffected,or is reasonablylikely tomateriallyaffect,our internalcontrolover
financialreporting.
As disclosedelsewhere inthis AnnualReport, we completedthe acquisitionof Echo LakeFoods duringthe first quarterof fiscal
2026. As permittedby SEC guidance, thescope of management’sreview of its internal controlover financialreportingexcluded
Echo LakeFoods.EchoLakeFoods constituted9.7%of totalassetsas ofMay30, 2026,and7.8%of totalnet salesfor fiscal
year2026.The Companyis in process of integrating EchoLakeFoods intoits internal controlframework.
ITEM 9B.OTHERINFORMATION
Duringour fourthquarterof fiscal2026,no directoror officerof theCompany
adopted
or
terminated
any Rule 10b5-1trading
arrangementor
non-Rule
10b5-1
trading arrangement,as suchterms aredefinedin Item408(a)or RegulationS-K.
ITEM 9C.DISCLOSUREREGARDINGFOREIGN JURISDICTIONSTHATPREVENTINSPECTIONS
Not applicable.
PARTIII.
ITEM 10.DIRECTORS,EXECUTIVEOFFICERSAND CORPORATEGOVERNANCE
Except as set forthbelow,the informationconcerning directors, executiveofficers andcorporategovernancerequired by Item 10
isincorporatedbyreferencefromourdefinitiveproxystatementwhichistobefiledpursuanttoRegulation14Aunderthe
Securities ExchangeAct of 1934in connectionwith our 2026AnnualMeeting ofStockholders.
We haveadopteda Code of Ethics and Business Conductthat applies to our directors, officersand employees,including the chief
executiveofficerandprincipalfinancialandaccountingofficers ofthe Company.Wewillprovidea copyof thecode freeof
chargeto anyperson thatrequests acopyby writing to:
Cal-Maine Foods,Inc.
1052HighlandColonyPkwy, Suite 200
Ridgeland,MS39157
Attn.:InvestorRelations
Requestscanbe madeby phoneat(601) 948-6813.
A copy is also available at our website www.calmainefoods.comunder the heading “InvestorRelations – Governance.” We intend
to discloseanyamendmentsto, or waiversfrom, theCode ofEthics andBusinessConducton ourwebsite promptlyfollowing
the dateof anysuch amendmentor waiver. Informationcontainedon our website is nota partof this report.
ITEM 11.EXECUTIVECOMPENSATION
The informationconcerning executivecompensationrequired by Item 11is incorporatedby referencefrom ourdefinitive proxy
statementwhich isto be filed pursuantto Regulation 14A under the SecuritiesExchangeAct of 1934 in connection with our2026
AnnualMeeting ofStockholders.
75
ITEM 12.SECURITY OWNERSHIPOF CERTAINBENEFICIALOWNERS ANDMANAGEMENTAND RELATED
STOCKHOLDERMATTERS
Exceptassetforthbelow,theinformationconcerningsecurityownershipofcertainbeneficialownersandmanagementand
relatedstockholdermattersrequiredby Item12 isincorporatedby referencefromour definitiveproxystatementwhich is tobe
filedpursuantto Regulation14Aunder theSecuritiesExchangeAct of1934in connectionwithour2026AnnualMeetingof
Stockholders.
SecuritiesAuthorizedfor Issuance underEquity CompensationPlans
Equity CompensationPlanInformation
(a)
(b)
(c)
Numberof securitiesto
be issuedupon exercise
of outstandingoptions,
warrants andrights
Weightedaverage
exercise price of
outstandingoptions,
warrants andrights
Numberof securitiesremaining
availablefor futureissuance under
equity compensationplans (excluding
securitiesreflectedin column(a))
Equity compensationplans
approvedby stockholders
9,260
$
—
719,234
Equity compensationplans not
approvedby stockholders
—
—
—
Total
9,260
$
—
719,234
(a)Consistsof9,260PSUsatthe targetperformancelevel outstandingunder ourAmendedandRestated2012Omnibus
Long-TermIncentivePlanas ofMay30,2026.If maximumperformancelevels areachieved,thenumberofshares
issuable forthe outstandingPSUs would be 13,890.
(b)There wereno outstandingoptions, warrantsor rights with an exercise priceas ofMay30, 2026.
(c)Reflects sharesavailablefor future issuance as of May30, 2026 underour Amendedand Restated2012 Omnibus Long-
TermIncentivePlan.
Foradditionalinformation,see
in PartII.Item8. NotestotheConsolidatedFinancial
Statements.
ITEM 13.CERTAINRELATIONSHIPSANDRELATEDTRANSACTIONS,AND DIRECTORINDEPENDENCE
Theinformationconcerningcertainrelationshipsandrelatedtransactions,anddirectorindependencerequiredbyItem13is
incorporatedby reference from our definitive proxy statementwhich isto be filed pursuant to Regulation14A under the Securities
ExchangeAct of 1934in connectionwith our 2026AnnualMeeting ofStockholders.
ITEM 14.PRINCIPALACCOUNTANTFEES ANDSERVICES
Theinformationconcerningprincipalaccountant feesandservices requiredbyItem14is incorporatedby referencefromour
definitiveproxystatementwhichistobefiledpursuanttoRegulation14AundertheSecuritiesExchangeActof1934in
connectionwith our 2026AnnualMeeting ofStockholders.
PARTIV.
ITEM 15.EXHIBIT ANDFINANCIALSTATEMENTSCHEDULES
(a)(1)FinancialStatements
76
Thefollowing consolidatedfinancialstatementsand notes theretoof Cal-Maine Foods,Inc. andits subsidiariesare includedin
Item8 andare filed herewith:
(PCAOB
5348
)
Fiscal YearsEndedMay30, 2026,May31, 2025andJune 1, 2024
(a)(2)FinancialStatementSchedule
All schedulesare omittedeither becausetheyare notapplicableor required, orbecausethe requiredinformationis includedin
the financialstatementsor notes thereto.
(a)(3)ExhibitsRequired byItem601 ofRegulationS-K
See Part(b) of this Item15.
(b)ExhibitsRequired byItem601 ofRegulationS-K
The followingexhibitsare filed herewithor incorporatedby reference:
Exhibit
Number
Exhibit
2.1
3.1
3.2
4.1
10.1
10.2
10.3
10.4*
10.5*
10.6*
10.7*
10.8*
10.9*
77
10.10*
10.11*
10.12*
SupplementalExecutive RetirementPlan, adoptedMarch 24, 2023 (incorporatedby reference toExhibit 10.1
10.13*
10.14*
19.1**
21**
23.1**
31.1**
31.2**
32***
97
101.SCH***+
Inline XBRLTaxonomyExtensionSchemaDocument
101.CAL***+
Inline XBRLTaxonomyExtensionCalculationLinkbaseDocument
101.DEF***+
Inline XBRLTaxonomyExtensionDefinition LinkbaseDocument
101.LAB***+
Inline XBRLTaxonomyExtensionLabel LinkbaseDocument
101.PRE***+
Inline XBRLTaxonomyExtensionPresentationLinkbaseDocument
104
Cover PageInteractiveDataFile(formattedas InlineXBRL andcontainedin Exhibit 101)
*Managementcontractor compensatoryplanor arrangement
**Filed herewithas anExhibit
***Furnishedherewith asanExhibit
+Submittedelectronically withthis AnnualReporton Form 10-K
(c)FinancialStatementSchedules Requiredby RegulationS-X
All schedulesfor whichprovisionis madein the applicableaccountingregulationsof theSecuritiesand ExchangeCommission
are notrequired underthe relatedinstructions or areinapplicableandthereforehavebeen omitted.
ITEM 16.FORM 10-K SUMMARY
None.
78
SIGNATURES
Pursuantto therequirementsof Section13 or15(d)of theSecuritiesExchangeAct of1934,the registranthas dulycausedthis
report tobe signed onits behalfby theundersigned, thereuntoduly authorized,in Ridgeland,Mississippi.
CAL-MAINEFOODS,INC.
/s/ ShermanL. Miller
ShermanL. Miller
PresidentandChief ExecutiveOfficer
Date:
July 22,2026
Pursuant tothe requirementsof theSecurities ExchangeAct of 1934,this report hasbeen signed below bythe following persons
on behalfof theregistrant andin the capacitiesandon thedatesindicated:
Signature
Title
Date
/s/ShermanL. Miller
President, ChiefExecutiveOfficer
ShermanL. Miller
andDirector
July 22,2026
(PrincipalExecutiveOfficer)
/s/MaxP. Bowman
VicePresident, Treasurer,Secretary,
MaxP. Bowman
Chief FinancialOfficerandDirector
July 22,2026
(PrincipalFinancialOfficer)
/s/ MatthewS. Glover
VicePresident, Accounting
July 22,2026
MatthewS. Glover
(PrincipalAccountingOfficer)
/s/Adolphus B.Baker
Chairmanof theBoardandDirectors
July 22,2026
Adolphus B.Baker
/s/Melanie Boulden
Director
July 22,2026
Melanie Boulden
/s/HaleyR. Fisackerly
Director
July 22,2026
HaleyR. Fisackerly
/s/Michael J.Highfield
Director
July 22,2026
Michael J.Highfield
/s/Letitia C.Hughes
Director
July 22,2026
Letitia C.Hughes
/s/Steve W.Sanders
Director
July 22,2026
Steve W.Sanders
/s/DudleyD. Wooley
Director
July 22,2026
DudleyD. Wooley
/s/CamilleS. Young
Director
July 22,2026
CamilleS. Young