Cal-maine Foods, Inc. · NASDAQ:CALM
Cal-maine Foods — Burkenroad Reports Investment Conference 2022
35 slides from Cal-maine Foods's conference presentation, Apr 29, 2022
Slide 1: Cal-Maine Foods Burkenroad Reports Investment Conference
CalMaine Foods Burkenroad Reports Investment Conference April 29, 2022 Max Bowman, Chief Financial Officer
Slide 2: Forward-looking statements and use of non-GAAP financial measures
Forwardlooking statements and use of nonGAAP financial measures Forward‐Looking and Cautionary Statements This presentation contains “forward‐looking statements” relating to, among other things, our shell egg business, including estimated future production data, expected construction schedules, proj
Slide 3: Cal-Maine Foods: corporate snapshot
CalMaine Foods: corporate snapshot U.S. EGG MARKET SCALE #1 shell egg producer and distributor(1) ~19% shell egg market share(2) ~13% share of U.S table egg layer flock(3) Category sales(4) 39% 3% 58% Conventional Specialty Egg products and other 9 MONTHS ENDED 2262022 FINANCIAL HIGHLIGHTS(5) $1.2 b
Slide 4: Scaled production and distribution capacity
Scaled production and distribution capacity(1) FULLY INTEGRATED OPERATIONS ~6.8 million eggs per hour production and processing capacity 41 production facilities 44 processing and packaging facilities 25 feed mills 3 breeding facilities 2 hatcheries ROBUST PRODUCTIONTO DISTRIBUTION CYCLE Support lay
Slide 5: CALM investment thesis: Why Cal-Maine Foods?
CALM investment thesis Why CalMaine Foods? 1 FOCUS ON FOOD CHOICE Affordable and nutritious protein portfolio Shift to premium, including cagefree, nutritionally enhanced, organic and hardcooked offerings Leverage scale to drive network efficiencies and customer reach Deploy key consumer insights to
Slide 6: Focus on food choice
Focus on food choice Image courtesy of Ksenia Gashkova, Unsplash. CALMAINE FOODS | BURKENROAD REPORTS INVESTMENT CONFERENCE | APRIL 29, 2022 5
Slide 7: Position food portfolio to meet nutrition imperatives
Position food portfolio to meet nutrition imperatives 1 — Focus on food choice 2 — Value drivers 3 — Growth positioned 2050 GLOBAL TRAJECTORIES ~9.7 billion people(1) 60% more food required(2) 69% calorie gap(3) PUBLIC HEALTH NEEDS E ggs supply “key nutrients” that support infant brain development i
Slide 8: Drive favorable mix while meeting customer needs
Drive favorable mix while meeting customer needs 1 Focus on food choice 2 — Value drivers 3 — Growth positioned CONTINUED VOLUME MIX SHIFT Market shift accelerated in 2019 w ith state cage free mandates and retailer commitments Driving higher specialty shell egg sales volumes, largely in line with r
Slide 9: Scale hardcooked egg offerings
Scale hardcooked egg offerings HARDCOOOKED IS AN ATTRACTIVE CATEORY Proteinpacked Ketofriendly and glutenfree Convenient for meal preparation and snacking Kidfriendly OUR CAPABILITIES ARE SCALING Hardcooked operation expected online in late 2Q FY 23 with ~26 million pounds annual capacity Plan to se
Slide 10: Value drivers
Value drivers Image courtesy of Allison Marras, Unsplash. CALMAINE FOODS | BURKENROAD REPORTS INVESTMENT CONFERENCE | APRIL 29, 2022 9
Slide 11: Excellent service for blue-chip customer base
Excellent service for bluechip customer base 1 —Focus on food choice 2 —Value drivers 3 —Growthpositioned MANAGE TOP10 RELATIONSHIPS(1) 1: Walmart/Sam’s Club 6: ALDI 2: H.E.B. 7: Costeo 3: Publix 8: Specialty Egg<2> 4: Food Lion 9: Kroger 5:Wakefern 10: C&S Wholesale Largest customer represents 29.8
Slide 12: Continued key consumer insights evaluation
Continued key consumer insights evaluation 1 — Focus on food choice 2 — Value drivers 3 — Growth positioned CONVENTIONAL EGG BUYERS' SELECT DEMOGRAPHIC TRAITS«1» Four plus person households Households with children Hispanic households Percent of U S. conve ntional egg spend Gen Z bom 1995+ 1% Millen
Slide 13: Leverage production to manage expense
Leverage production to manage expense 1 — Focus on food choice 2 — Value drivers 3 — Growth positioned MANAGE COST OF SALES (COS) Farm produc tion costs, largely feed ingredients, facility and amortization, drives COS expense Since 2019, reduction in outside egg purc hased have helped offset shell e
Slide 14: Navigate volatile feed ingredient pricing
Navigate volatile feed ingredient pricing 1 — Focus on food choice 2 — Value drivers 3 — Growth positioned MONITOR FEED INGREDIEN T INPUTS Expect continued feed market volatility given market drivers Russian war against Ukraine has hampered Black Sea grai n exports USDA’s March projections estimate
Slide 15: Build on strong acquisition and integration track record
Build on strong acquisition and integration track record SUCCESSFUL INTEGRATION HISTORY INFORMS OUR OUTLOOK 23 SUCCESSFUL INTEGRATIONS SINCE 1989(1) ACQUISITION BENEFITS Geography Cagefree capability Milling Processing SYNERGY HIGHLIGHTS Customer proximity Specialty franchise access Integrated distr
Slide 16: Focus on improving our financial results
Focus on improving our financial results 1 —Focus on food choice 2 — Value drivers 3 —GrowthpositionedDRIVE NET SALES(1) Strive to improve topline growth that is levered to shell egg price and continued customer wins Mix shift to specialty helps mitigate reliance on more volatile conventional shell
Slide 17: Seasoned HPAI risk management team
Seasoned HPAI risk management team 1 — Focus on food choice 2 —Value drivers 3 —Growthpositioned MANAGING THROUGH AVIAN INFLUENZA Our longtenured and seasoned operations team helped us manage through the 2014 2015 avian influenza outbreak. They continue to help us protect our people, our food and ou
Slide 18: Growth-positioned
Growthpositioned Image courtesy of Jingxi Lau, Unsplash. CALMAINE FOODS | BURKENROAD REPORTS INVESTMENT CONFERENCE | APRIL 29, 2022 17
Slide 19: Poised to execute amidst tighter supply indicators
Poised to execute amidst tighter supply indicators 1 —Focus on food choice 2 —Value drivers 3 Growthpositioned U.S. LAYER HEN TIGHTENED SUPPLY«» Layer hen supply is a key indicator of table egg production capacity* • Apr. l, 2022: table egg layer hen inventory of 305.2 million reflects recent HPAI i
Slide 20: Continue to evolve our strong human capital focus
Continue to evolve our strong human capital focus 1 — Focus on food choice 2 Value drivers 3 —Growth-positioned Jia Scott, left, serves as Vice President, Treasury, and oversees the company’s treasury management, accounts payable and corporate tax functions. Jia also helps oversee the company’s phil
Slide 21: Drive colleague engagement and safety outcomes
Drive colleague engagement and safety outcomes 1 —Focus on food choice 2 —Value drivers 3 —Growthpositioned Trisha Perkins, left, and Melvin Bonds serve as Corporate Safety Managers who develop and deploy enterprise safetyprotocols and training. They also manage enterprise health and safety complian
Slide 22: Execute against capital allocation priorities
Execute against capital allocation priorities 1 — Focus on food choice 2 Value drivers 3 —Growthpositioned OX leverage Our $250 million undrawn credit facility provides flexibility and allows for growth(1) MANAGE CASH PRIORITIES Selective acquisition posture for cagefree capacity Variable dividend p
Slide 23: Positioned to supply transitioning shell egg demand
Positioned to supply transitioning shell egg demand 1 — Focus on food choice 2 — Value drivers 3 Growth positioned CAGE F REE DEMAND DRIVERS Husbandry focus Appetite for diverse housing conditions Consumer social responsibility Focus on human and animal health and well being Legislative actions 27 3
Slide 24: Building on our sustainable cornerstone
Building on our sustainable cornerstone 1 — Focus on food choice 2 Value drivers 3 — Growth positioned QUALITY FOOD CHOICES Our efforts continue to drive strong results #1 score #1ISS score: product safety, quality & brand (1) zero product recalls or market bans in prior three fiscal y ears^ 100% SQ
Slide 25: Key takeaways
Key takeaways Image courtesy of Anshu A, Unsplash. CALMAINE FOODS | BURKENROAD REPORTS INVESTMENT CONFERENCE | APRIL 29, 2022 24
Slide 26: Key takeaways
Key takeaways Quality food choices 1.073 billion dozens sold FY21 60+ years operating Largest producer and distributor of fresh shell eggs and egg products in the U.S. Provenand highly efficient operators with deep talent bench and industry expertise Nimble and poised to meet evolving consumer foodc
Slide 27: Appendix
Appendix Image courtesy of Max Griss, Unsplash. CAL-MAINE FOODS | BURKENROAD REPORTS INVESTMENT CONFERENCE | APRIL 29, 2022 26
Slide 28: Key market indicators
Key market indicators URNER BARRY SOUTHEAST LARGE INDEX Observed FY average daily price per dozen(1) $1.55 $1.76 $0.85 $1.49 $1.23 $1.22 $1.16 $1.61 2015 2016 2017 2018 2019 2020 2021 2022 YTD U.S. CONSUMER EGG EXPENDITURES(2) U.S. consumer demographic egg expenditures 2015 through 2020 $90 $82 $69
Slide 29: Select income statement highlights
Select income statement highlights Cal Maine Foods' select income statement highlight (in thousands, excepted store amount) 39 weeks ended Fiscal year ended February 26. 2022 Februar / 27, 2021 May 29. 2021 May 30. 2020 Net sale 1,1 84,195 999,189 1,348,987 1,351,609 Cross profit 1 41,974 1 22,732 1
Slide 30: Select operating results
Select operating results (in thousands, except percentage data) 39 weeks ended Fiscal year ended February 26, 2022 February 27, 2021 May 29, 2021 May 30, 2020 Dozens sold: Conventional 568,51 1 599,625 785,446 81 3,255 Specialty 243,310 21 7,735 287,765 255,895 Total 81 1,821 81 7,360 1,073,21 1 1 ,
Slide 31: EBITDA reconciliation
EBITDA reconciliation NonGAAP Measure EBITDA EBITDA is a nonGAAP measure and defined as net income attributable to CalMaine Foods, Inc. plus interest, taxes, depreciation and amortization.The following table sets forth a reconciliation of EBITDA to net income attributable to CalMaine Foods, Inc.: Ea
Slide 32: Citations Slide – Cal-Maine Foods' snapshot
Citations Slide 2 – Cal Maine Foods’ snapshot 1) Rankings from Watt Poultry. “2022 Poultry Top U.S. Egg Producers Rankings.” Data as of December 31, 2021. 2) World Agricultural Supply and Demand Estimates (WASDE). U.S. market share data is as of calendar year end; CALM percent of shell egg market sh
Slide 33: Citations Slide – Continued key consumer insights evaluation
Citations Slide 11 Continued key consumer insights evaluation 1) IRI Unify. All Outlets, Last 52 Weeks ending 03.27.2022.Conventional Egg Buyers n=48,934 and Cage Free Egg Buyers n= 16,026 2) Numerator, Psychographics. Slide 12 –Leverage production to manage expense 1) Company data. Slide 13 Navigat
Slide 34: Citations Slide – Continue to evolve our strong human capital focus
Citations Slide 19 Continue to evolve our strong human capital focus 1) Cal Maine Foods’ Human Rights Statement. https://www.calmainefoods.com/medi a/1189/cal maine foods human rights - statement final.pdf. 2) Cal Maine Foods’ Company data. Slide 20 Drive colleague engagement and safety outcomes 1)
Slide 35: Cal-Maine Foods
CalMaine Foods CALMAINE FOODS | BURKENROAD REPORTS INVESTMENT CONFERENCE | APRIL 29, 2022 34
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