UNITED STATES
SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549

# FORM 10-K

||X| | ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
         FOR FISCAL YEAR ENDED May 28, 2005
|--- | --------------------------------------------------------------------------------------------------------------------------------

||_| | TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF       1934
|--- | ----------------------------------------------------------------------------------------------

Commission file number: 000-04892

CAL-MAINE FOODS, INC.
(Exact name of registrant as specified in its charter)

|                                |                    
|------------------------------- | -------------------
|Delaware                        | 64-0500378         
|(State or other Jurisdiction of | (I.R.S. Employer   
|Incorporation or Organization)  | Identification No.)

3320 Woodrow Wilson
Avenue, Jackson, Mississippi 39209 (Address of principal executive offices) (Zip Code)

(601) 948-6813
(Registrants telephone number, including area code)

Securities registered pursuant to
Section 12 (b) of the Act:  NONE

Securities registered pursuant to
Section 12 (g) of the Act:  Common Stock, $0.01 par value

Indicate by check mark whether the
registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.

| | Yes  X     No
| | -------------

Indicate by check mark if disclosure
of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and
will not be contained, to the best of registrants knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. (  )

Indicate by check mark whether the
registrant is an accelerated filer (as defined in Exchange Act Rule 12b-2).

| | Yes  X     No
| | -------------

The aggregate market value, as
reported by the NASDAQ National Market, of the registrants Common Stock, $0.01 par
value, held by non-affiliates at November 27, 2004, which was the date of the last
business day of the registrants most recently completed second fiscal quarter, was
$161,898,900.

As of August 3,2005,
21,148,291 shares of the registrants Common Stock, $0.01 par value, and 2,400,000
shares of the registrants Class A Common Stock, $0.01 par value, were outstanding.

DOCUMENTS INCORPORATED
BY REFERENCE

The information called for by Part
III of the form 10-K is incorporated herein by reference from the registrants
Definitive Proxy Statement which will be filed pursuant to Regulation 14A not later than
120 days after the end of the fiscal year covered by this report.

1

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# TABLE OF CONTENTS

# Part I

|  
|--
|1.
|2.
|3.
|4.

# Part II

|    |                                                                                                                     |   
|--- | ------------------------------------------------------------------------------------------------------------------- | --
|5.  | Market for the Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of    Equity Securities | 15
|6.  | Selected Financial Data                                                                                             | 17
|7.  | Management's Discussion and Analysis of Financial Condition and Results of Operations                               | 18
|7A. | Quantitative and Qualitative Disclosures About Market Risk                                                          | 25
|8.  | Financial Statements and Supplementary Data                                                                         | 25
|9.  | Changes in and Disagreements with Accountants on Accounting and Financial Disclosure                                | 46
|9A. | Controls and Procedures                                                                                             | 46
|9B. | Other Information                                                                                                   | 46

# Part III

|    |                                                                                                |   
|--- | ---------------------------------------------------------------------------------------------- | --
|10. | Directors and Executive Officers of the Registrant                                             | 47
|11. | Executive Compensation                                                                         | 47
|12. | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters | 47
|13. | Certain Relationships and Related Transactions                                                 | 47
|14. | Principal Accountant Fees and Services                                                         | 47

# Part IV

|    |                                            |   
|--- | ------------------------------------------ | --
|15. | Exhibits and Financial Statement Schedules | 48
|    | Signatures                                 | 51

2

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# PART I

# ITEM 1. BUSINESS

Our
Business

Cal-Maine
Foods, Inc. (we, us, our, or the Company)
is the largest producer and marketer of shell eggs in the United States. In fiscal year
2005, we sold approximately 575 million dozen shell eggs, which represented about 13% of
domestic shell egg consumption in the United States. Our total flock, which is comprised
of approximately 18 million layers and 4 million pullets and breeders, is the largest in
the United States. Layers are mature female chickens, pullets are young female chickens
usually under 20 weeks of age, and breeders are male or female chickens used to produce
fertile eggs to be hatched for egg production flocks. Our primary business is the
production, grading, packaging, marketing and distribution of shell eggs. We sell the
majority of our shell eggs in 28 states, primarily in the southwestern, southeastern,
mid-western and mid-Atlantic regions of the United States. We market our shell eggs
through our extensive distribution network to a diverse group of customers, including
national and regional grocery store chains, club stores, foodservice distributors and egg
product manufacturers. The strength of our position is evidenced by the fact that we have
the largest market share in the grocery segment for shell eggs and we sell shell eggs to 9
of the 10 largest food retailers in the United States.

We
are also the largest producer and marketer of value-added specialty shell eggs in the
United States. Specialty shell eggs include reduced cholesterol, cage free and organic
eggs and are a rapidly growing segment of the market. In fiscal 2005, specialty shell eggs
were estimated to represent approximately 14% of our shell egg dollar sales. Retail prices
for specialty eggs are higher than standard shell eggs due to consumer willingness to pay
for the increased benefits from those products. We market our specialty shell eggs under
two distinct brands: Egg-Lands Best(TM) and
Farmhouse(TM). We own a 20% equity interest in Egg-Lands Best,
Inc., which markets the leading brand in the specialty shell egg segment. We have
exclusive license agreements to market and distribute Egg-Lands Best(TM)
specialty shell eggs in major metropolitan areas, including New York City, and a number of
states in the southeast and southwest. We market cage free eggs under our trademarked
Farmhousebrand and distribute those shell eggs across the southeast and southwest
regions of the United States. We also produce market and distribute private label
specialty shell eggs to several customers. Sales of specialty shell eggs accounted for
approximately 6.5% of our total shell egg dozen volume in fiscal 2005 and 5.6% for fiscal
2004.

We
are also a leader in industry consolidation. Since 1989, we have completed ten
acquisitions ranging in size from 600,000 layers to 7.5 million layers. On July 28, 2005,
we entered into an agreement for the acquisition of the operations of Hillandale Farms,
Inc. and Hillandale Farms of Florida, Inc. Despite a market that has been characterized by
increasing consolidation, the shell egg production industry remains highly fragmented.
There are currently 61 producers who each own more than one million layers and the ten
largest producers own approximately 40% of total industry layers. We believe industry
consolidation will continue and we plan to capitalize on opportunities as they arise.

Hillandale
Acquisition

We
have entered into an Agreement to Form a Limited Liability Company, Transfer Assets
Thereto, and Purchase Units of Membership Therein, dated July 28, 2005, with Hillandale
Farms, Inc. and Hillandale Farms of Florida, Inc. (together, Hillandale), and
the Hillandale shareholders (the Agreement). Pursuant to the Agreement, we
will acquire Hillandales egg production and marketing operations. Hillandales
production facilities are principally located in Florida, where it began operations over
30 years ago. Hillandale has a strong marketing presence in Florida, Georgia and Alabama.
When completed, the Hillandale acquisition is expected to increase our current egg
production capacity by approximately 30%.

Under
the terms of the Agreement, the Hillandale assets to be acquired and liabilities to be
assumed by us will be transferred to a new Florida limited liability company named
Hillandale, LLC. The two Hillandale companies will be the initial members of Hillandale,
LLC, for formation purposes. Upon the completion of an evaluation of the assets and
liabilities to be acquired and assumed by us, as agreed to by the parties to the
Agreement, we will purchase 51% of the Units of Membership in Hillandale, LLC. The
remaining 49% of the Units of Membership in Hillandale, LLC, are to be acquired in
essentially equal annual installments over a four-year period, with the purchase price of
the units equal to their book value as calculated in accordance with the terms of the
Agreement. The acquisition will be made for cash, from our available funds, and borrowings
to the extent necessary. We will acquire our initial 51% interest in Hillandale, LLC, at a
presently estimated cost of approximately $30 to $35 million, subject to adjustment
upwards or downwards, based upon the valuations agreed upon by the parties to the
Agreement.

3

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During
2004, Hillandale sold approximately 129.3 million dozen eggs produced by its flock of
layers at eight production facilities located in Florida and Alabama, including
approximately 3.9 million dozen produced under contract arrangements with others. Like us,
Hillandale is a fully integrated producer with its own feed mills and distribution
facilities.

Our
Corporate Information

We
were incorporated in Delaware in 1969. Our principal executive office is located at 3320
Woodrow Wilson Drive, Jackson, Mississippi 39209. The telephone number of our principal
executive office is (601) 948-6813. We maintain a website at www.calmainefoods.com
where general information about our business is available. The information contained in
our website is not a part of this document. Our annual reports on Form 10-K, our quarterly
reports on Form 10-Q, our current reports on Form 8-K, Forms 3 and 4, and all amendments
to those reports are available, free of charge, through our web site as soon as reasonably
practicable after they are filed with the SEC. Information concerning corporate governance
matters is also available on the website.

Our
Common Stock is traded on the NASDAQ National Market under the symbol CALM. On
May 27, 2005, the last sale price of our Common Stock was $6.76 per share.Our
fiscal year 2005 ended May 28, 2005 and the first three fiscal quarters of fiscal 2005
ended August 28, 2004, November 27, 2004 and February 26, 2005. All references to a fiscal
year means our fiscal year and all references to a year mean a calendar year.

We
have adopted a Code of Conduct and Ethics for Directors, Officers and Employees, including
the chief executive and principal financial and accounting officers of the Company. We
will provide a copy of the code free of charge to any person that requests a copy by
writing to:

Cal-Maine Foods, Inc.
 P.O.           Box 2960  Jackson, Mississippi 39207  Attn.: Investor Relations

Requests can be made by
phone at (601) 948-6813

A
copy is also available at our website www.calmainefoods.com. Information contained
on our website is not a part of this report.

IMPORTANT FACTORS
RELATING TO FORWARD-LOOKING STATEMENTS

This
report contains numerous forward-looking statements relating to the Companys shell
egg business, including estimated production data, expected operating schedules, expected
capital costs and other operating data. Such forward-looking statements are identified by
the use of words such as believes, intends, expects,
hopes, may, should, plan,
projected, contemplates, anticipates or similar words.
Actual production, operating schedules, results of operations and other projections and
estimates could differ materially from those projected in the forward-looking statements.
The factors that could cause actual results to differ materially from those projected in
the forward-looking statements include (i) the risk factors set forth below under this
Item 1, (ii) the risks and hazards inherent in the shell egg business (including disease,
pests, and weather conditions), (iii) changes in the market prices of shell eggs, and (iv)
changes that could result from the Companys future acquisition of new flocks or
businesses. Readers are cautioned not to put undue reliance on forward-looking statements.
The Company disclaims any intent or obligation to update publicly these forward-looking
statements, whether as a result of new information, future events or otherwise.

4

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Industry
Background

The United States Department of Agriculture reported that in 2003 the wholesale shell
egg industry was a $4.5 billion market. Shell eggs are a staple food product and 94% of US
homes buy shell eggs according to the 2003 Progressive Grocer Consumer Expenditure Study.
Based on historical consumption trends, demand for shell eggs increases in line with
overall population growth, averaging an increase of about 1% per year. According to U.S.
Department of Agriculture reports, since 1999, annual per capita consumption in the United
States has varied between 250 and 256 eggs. In 2004, per capita consumption in the United
States was 253 eggs, or approximately five eggs per person per week.

Prices
for Shell Eggs

Shell
egg prices are a critical component of profitability in the industry. Over 90% of all
shell eggs sold in the United States in the retail and foodservice channels are sold at
prices related to the Urner Barry wholesale quotation for shell eggs. For fiscal 2005,
wholesale shell egg prices averaged 71.9 cents per dozen compared to an average of 84.3
cents per dozen for fiscal years 2002 to 2004. The current price environment is weak due
to moderate demand for shell eggs and a slight oversupply of eggs.

Factors
currently influencing demand:

| |  | industry
advertising campaigns successfully promoting the health benefits of eggs;
| | - | ----------------------------------------------------------------------------------

| |  | positive
announcements from the medical community highlighting eggs as a good source of protein;
| | - | ------------------------------------------------------------------------------------------------

| |  | increased
consumption resulting from the factors noted above as well as the reduced level of
cholesterol in eggs;              and
| | - | ----------------------------------------------------------------------------------------------------------------------------------

| |  | increased
demand from the foodservice channel.
| | - | ----------------------------------------------

Factors currently
influencing supply:

| |  | living
space for newly hatched layers will increase 20% by 2008 according to guidelines put in
place by the United Egg Producers, in conjunction with the Food Marketing Institute, both
industry trade associations; and
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | the
process to bring new shell egg production capacity online has become more complex than in
the past, increasing the time it takes to bring new capacity to market .
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------

Feed
Costs for Shell Egg Production

Feed
is a primary cost component in the production of shell eggs and represents over one-half
of industry production costs. Most shell egg processors are vertically integrated;
manufacturing the majority of the feed they require themselves. Although feed ingredients
are available from a number of sources, prices for ingredients can fluctuate and can be
affected by weather and by various supply and demand factors. Current prices for corn and
soybeans, essential feed ingredients, are favorable this year compared to with last year.
However, there are wide swings in corn and soybean prices because of dry conditions in the
Midwest and widely varying forecast projections for the 2005 fall crop and harvest season
in September and October.

5

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Growth
Strategy and Acquisitions

For
many years, we have pursued a growth strategy focused on the acquisition of existing shell
egg production and processing facilities, as well as the construction of new and more
efficient facilities. Since the beginning of fiscal 1989, we have completed ten
acquisitions, and built seven new in-line shell egg production and processing
facilities and one pullet growing facility, adding 8 million layers and 1.5 million
growing pullets to our capacity. Each of the new shell egg production facilities generally
provides for the processing of approximately 400 cases of shell eggs, or 12,000 dozen
eggs, per hour. These increases in capacity have been accompanied by the retirement of
older and less efficient facilities and a reduction in eggs produced by contract
producers. The in-line facilities result in the gathering, grading and
packaging of shell eggs by less labor-intensive, more efficient, mechanical means.

As
a result of our strategy, our total flock, including pullets, layers and breeders, has
increased from approximately 6.8 million at May 28, 1988 to an average of approximately
23.9 million for each of the past five fiscal years. Also, the number of dozens of shell
eggs sold has increased from approximately 117 million in the fiscal year ended May 28,
1988 to an average of approximately 571.6 million over the past five fiscal years. Net
sales amounted to $375.3 million in fiscal 2005 compared to net sales of $69.9 million in
fiscal 1988.

The
completion of our acquisition of the Hillandale operations will significantly increase our
production and processing facilities, and enhance our market penetration in the
southeastern part of the country. With our investment in Hillandale, LLC, our total flock
of pullets, layers and breeders will increase from 22.3 million at May 28, 2005, to
approximately 29.5 million. Also, our egg production and processing facilities will expand
through our acquisition of Hillandales production operations located in Alabama and
Florida. We anticipate that, in the normal course, members of Hillandales present
management will be integrated with our management. A copy of the Agreement, as
incorporated by reference to our Form 8-K Current Report dated July 28, 2005, is included
as an exhibit to this Form 10-K Annual Report. Financial statements of Hillandale, as
required under Rules of the SEC, will be provided in Form 8-K current report to be filed
by us at a later date.

We
propose to continue to pursue opportunities for the acquisition of other companies engaged
in the production and sale of shell eggs. We will continue to evaluate and selectively
pursue acquisitions that will expand our shell egg production capabilities in existing
markets and broaden our geographic reach. We have extensive experience identifying,
valuing, executing and integrating acquisitions and we intend to leverage that experience
in the evaluation and execution of future acquisitions. We will seek to acquire regional
shell egg businesses that have significant market share and long-standing customer
relationships. We believe that enhancing our national presence will help us further
strengthen our relationships with existing customers which have operations across the
United States.

Through
exclusive license agreements with Egg-Lands Best, Inc. in several key territories
and our trademarked Farmhousebrand, we are the leading producer and marketer of
value-added specialty shell eggs. We also produce, market and distribute private label
specialty shell eggs to several customers. Since selling prices of specialty shell eggs
are not related to the generic shell egg market, we believe that growing our specialty
eggs business will enhance the stability of our margins. We expect that the price of
specialty eggs will remain at a premium to regular shell eggs. We intend to pursue
acquisitions that may expand our specialty shell egg production.

Federal
anti-trust laws require regulatory approval of acquisitions that exceed certain threshold
levels of significance. Also, we are subject to federal and state laws generally
prohibiting anti-competitive conduct. Because the shell egg production and distribution
industry is so fragmented, we believe that our sales of shell eggs during its last fiscal
year represented only approximately 13% of domestic shell egg sales notwithstanding that
we are the largest producer and distributor of shell eggs in the United States based on
independently prepared industry statistics. We believe that regulatory approval of any
future acquisitions either will not be required, or, if required, that such approvals will
be obtained.

6

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The
construction of new, more efficient production and processing facilities is an integral
part of our growth strategy. Any such construction will require compliance with applicable
environmental laws and regulations, including the receipt of permits that could cause
schedule delays, although we have not experienced any significant delays in the past.

Shell
Eggs *

Production. Our
operations are fully integrated. At our facilities, we hatch chicks,           grow
pullets, manufacture feed and produce and distribute shell eggs.           Company-owned
facilities accounted for approximately 88% of our total fiscal           2005 egg
production, with the balance attributable to contract producers used by           us.
Under arrangements with our contract producers, we own the entire flock,
          furnish all feed and supplies, own the shell eggs produced and assume all
market           risks. The contract producers own their facilities and are paid a fee
based on           production with incentives for performance.

The
commercial production of shell eggs requires a source of baby chicks for laying flock
replacement. We produce approximately 98% of our chicks in our own hatcheries and obtain
the balance from commercial sources. We own breeder facilities producing 13 million pullet
chicks per year in a computer-controlled environment. These pullets are distributed to 19
state-of-the-art laying operations around the southwestern, southeastern, mid-western and
mid-Atlantic regions of the United States. The facilities produce an average of 13 million
shell eggs per day and process the shell eggs through grading and packaging without
handling by human hands. We have spent a cumulative total of $40 million over the past
five years upgrading our facilities with the most advanced equipment and technology
available in our industry. We believe our focus on automation throughout the supply chain
enables us to be a low cost supplier in all the markets in which we compete.

Feed
for the laying flocks is produced by Company-owned and operated mills located in the
southwestern, southeastern, mid-western and mid-Atlantic regions of the United States. All
ingredients necessary for feed production are readily available in the open market and
most are purchased centrally from Jackson, Mississippi. Approximately 97% of the feed for
our flocks is manufactured at feed mills owned and operated by us. Poultry feed is
formulated using a computer model to determine the least-cost ration to meet the
nutritional needs of the flocks. Although most feed ingredients are purchased on an
as-needed basis, from time-to-time, when deemed advantageous, we purchase ingredients in
advance with a delayed delivery of several weeks or a few months.

Feed
cost represents the largest element of our farm egg production cost, ranging from 53% to
57% of total cost in the last five years, or an average of approximately 55%. Although
feed ingredients are available from a number of sources, we have little, if any, control
over the prices of the ingredients we purchase, which are affected by weather and by
various supply and demand factors. Increases in feed costs not accompanied by increases in
the selling price of eggs can have a material adverse effect on the results of our
operations. However, higher feed costs may encourage producers to reduce production,
possibly resulting in higher egg prices. Alternatively, low feed costs can encourage
industry overproduction, possibly resulting in lower egg prices. Historically, we have
tended to have higher profit margins when feed costs are higher. However, this may not be
the case in the future.

After
the eggs are produced, they are graded and packaged. Substantially all of our farms have
modern in-line facilities that mechanically gather, grade and package the eggs
produced. The increased use of in-line facilities has generated significant cost savings
as compared to the cost of eggs produced from non-in-line facilities. In addition to
greater efficiency, the in-line facilities produce a higher percentage of grade A eggs,
which sell at higher prices. Eggs produced on farms owned by contractors are brought to
our processing plants where they are graded and packaged. Since shell eggs are perishable,
we maintain very low shell egg inventories, usually consisting of approximately four days
of production.

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*
The business and industry discussion set forth in this section and elsewhere in this Form
10-K Annual Report also is generally applicable to Hillandale. However, information
relating to our chick and layer population, production facilities, number of eggs
produced, number of employees, properties, and other such facts, does not give effect to
the Hillandale acquisition.

7

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Our
egg production activities are subject to risks inherent in the agriculture industry, such
as weather conditions and disease factors. These risks are not within our control and
could have a material adverse effect on our operations. Also, the marketability of our
shell eggs is subject to risks such as possible changes in food consumption opinions and
practices reflecting perceived health concerns.

We
operate in a cyclical industry with total demand that is generally level and a product
that is price-inelastic. Thus, small increases in production or decreases in demand can
have a large adverse effect on prices and vice-versa. However, economic conditions in the
egg industry are expected to exhibit less cyclicality in the future. The industry is
concentrating into fewer but stronger hands, which should help lessen the extreme
cyclicality of the past.

Marketing. Of
the 575 million dozen shell eggs sold by us in the fiscal year ended May           28,
2005, 435 million were produced by our flocks.

We
sell our shell eggs to a diverse group of customers, including national and local grocery
store chains, club stores, foodservice distributors and egg product manufacturers. We
utilize electronic ordering and invoicing systems that enable us to manage inventory for
certain of our customers. Our top 10 customers accounted for an aggregate of 64.7% of net
sales in the fiscal 2005 and 58.4% of net sales for fiscal 2004. One customer, H.E. Butt
Grocery Co., accounted for 12.1% of net sales during fiscal 2005 and 11.9% of net sales
for fiscal 2004, and two affiliated customers, Wal-Mart Stores and Sams Clubs, on a
combined basis, accounted for 30.9% of net sales during fiscal 2005 and 26.8% of net sales
for fiscal 2004.

The
majority of eggs sold are merchandised on a daily or short-term basis. Most sales to
established accounts are on open account with terms ranging from seven to 30 days.
Although we have established long-term relationships with many of our customers, they are
free to acquire shell eggs from other sources.

The
shell eggs we sell are either delivered by us to our customers warehouses and
facilities with our own fleet of owned or contracted delivery trucks or are picked up by
our customers at our warehouses.

We
sell our shell eggs at prices generally related to independently quoted wholesale market
prices. Wholesale prices are subject to wide fluctuations. The prices of our shell eggs
reflect fluctuations in the quoted market, and the results of our shell egg operations are
materially affected by changes in market quotations. Egg prices reflect a number of
economic conditions, such as the supply of eggs and the level of demand, which, in turn,
are influenced by a number of factors that we cannot control. No representation can be
made as to the future level of prices.

According
to U.S. Department of Agriculture reports, since 1999, annual per capita consumption in
the United States has varied between 250 and 256 eggs. While we believe that increased
fast food restaurant consumption, high protein diet trends, reduced egg cholesterol levels
and industry advertising campaigns may result in a continuance of the recent increases in
current per capita egg consumption levels, no assurance can be given that per capita
consumption will not decline in the future.

We
sell the majority of our shell eggs in approximately 28 states across the southwestern,
southeastern, mid-western and mid-Atlantic regions of the United States. We are a major
factor in egg marketing in a majority of these states. Many states in our market area are
egg deficit regions; that is, production of fresh shell eggs is less than total
consumption. Competition from other producers in specific market areas is generally based
on price, service, and quality of product. Strong competition exists in each of our
markets.

Seasonality.  Shell
eggs are perishable. Consequently, we maintain very low           shell egg inventories,
usually consisting of approximately four days of           production. Retail sales of
shell eggs are greatest during the fall and winter           months and lowest during the
summer months. Prices for shell eggs fluctuate in           response to seasonal demand
factors and a natural increase in egg production           during the spring and early
summer. We generally experience lower sales and net           income in our fourth and
first fiscal quarters ending in May and August,           respectively. During the past
ten years, eight of our first quarters and five of           our fourth quarters have
resulted in net operating losses.

8

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Specialty
Eggs. We also produce specialty eggs such as Egg-Lands
Best and Farmhouse eggs. Egg-Lands Besteggs are
patented eggs that are believed by its developers, based on scientific studies, to cause
no increase in serum cholesterol when eaten as part of a low fat diet. We produce and
process Egg-Lands Besteggs, under license from Egg-Lands
Best, Inc. (EB), at our existing facilities, under EB guidelines. The product
is marketed to our established base of customers at prices that reflect a premium over
ordinary shell eggs. Egg-Lands Best eggs accounted for approximately
11.0% of our net sales in fiscal 2005. Farmhousebrand eggs are produced at our
facilities by hens that are not caged, and are provided with a diet of natural grains and
drinking water that is free of hormones or other chemical additives. Farmhouse eggs
accounted for 2.4% of our net sales in fiscal 2005. They are intended to meet the demands
of consumers who are sensitive to environmental and animal welfare issues.

Competition. The
production, processing, and distribution of shell eggs is an intensely
          competitive business, which, traditionally, has attracted large numbers of
          producers. Shell egg competition is generally based on price, service, and
          quality of production. Although we are the largest combined producer,
processor,           and distributor of shell eggs in the United States, we do not occupy
a           controlling market position in any area where our eggs are sold.

While
the shell egg industry remains highly fragmented, it has been characterized by a growing
concentration of producers. In 2004, 61 producers with one million or more layers owned
84% of the 287 million total U.S. layers, compared with the 56 producers with one million
or more layers owning 64% of the 232 million total U.S. layers in 1990, and 61 producers
with one million or more layers owning 56% of the 248.0 million total U.S. layers in 1985.
We believe that a continuation of that concentration trend may result in the reduced
cyclicality of shell egg prices, but no assurance can be given in that regard. A
continuation of this trend could also create greater competition among fewer producers.

Patents and Tradenames.We own the trade names Farmhouse, Rio Grande and
Sunups. We do not own any patents or proprietary technologies. We produce and market
Egg-Lands Best(TM) eggs under license agreements with EB. We own a 20% equity
interest in EB.

Government Regulation.Our facilities and operations are subject to
regulation by various federal, state and local agencies, including, but not limited to,
the FDA, the USDA, the Environmental Protection Agency, the Occupational Safety and Health
Administration and corresponding state agencies. The applicable regulations relate to
grading, quality control, labeling, sanitary control and waste disposal. Our shell egg
facilities are subject to periodic USDA inspections. Our feed production facilities are
subject to FDA regulation and inspections. In addition, we maintain our own inspection
program to assure compliance with our own standards and customer specifications. We do not
know of any major capital expenditures necessary to comply with such statutes and
regulations; however, there can be no assurance that we will not be required to incur
significant costs for compliance with such statutes and regulations in the future.

Environmental Regulation.Our operations and facilities are subject to
various federal, state and local environmental laws and regulations governing, among other
things, the generation, storage, handling, use, transportation, disposal and remediation
of hazardous materials. Under these laws and regulations, we are also required to obtain
permits from governmental authorities, including, but not limited to, wastewater discharge
permits. We have made and will continue to make capital and other expenditures relating to
compliance with existing environmental, health and safety laws and regulations and
permits. We do not currently know of any major capital expenditures necessary to comply
with such laws and regulations; however, because environmental, health and safety laws and
regulations are becoming increasingly more stringent, including those relating to animal
wastes and wastewater discharges, there can be no assurance that we will not be required
to incur significant costs for compliance with such laws and regulations in the future. In
addition, under certain circumstances, we may incur costs associated with our contract
producers failure to comply with laws and regulations, including environmental laws
and regulations.

9

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Employees. As
of May 28, 2005, we had a total of approximately 1,400 employees of whom           1,270
worked in egg production, processing and marketing, 80 were engaged in           feed
mill operations and 50 were administrative employees, including officers,           at
our executive offices. Approximately 5% of our personnel are part-time. None           of
our employees are covered by a collective bargaining agreement. We consider           our
relations with employees to be good.

Risk
factors

We
are subject to numerous risks and uncertainties, including the following:

Market prices of wholesale shell eggs are volatile and changes in these prices and costs
can adversely impact our results of operations.

Our
operating results are significantly affected by wholesale shell egg market prices, which
fluctuate widely and are outside of our control. Small increases in production or small
decreases in demand can have a large adverse effect on shell egg prices. Shell egg prices
have experienced an upward trend since 2002 and rose to historical highs in late 2003 and
early 2004. In the early fall of 2004, the demand trend related to the popular diets faded
dramatically. During this time of increased demand, the egg industry had geared up to
produce more eggs to meet the demand. During the past nine to twelve months, the industry
has experienced an oversupply of eggs resulting in lower egg prices. In March 2005, the
egg industry took action to reduce the size of the laying flocks. Current U.S. Department
of Agriculture statistics indicate a reduced flock size that is now more in line with
current demand. There can be no assurance that shell egg prices will remain at or near
current levels and that the supply of shell eggs will remain level in the future.

Retail
sales of shell eggs are greatest during the fall and winter months and lowest during the
summer months. Prices for shell eggs fluctuate in response to seasonal factors and a
natural increase in shell egg production during the spring and early summer. Shell egg
prices tend to increase with the start of the school year and are highest prior to holiday
periods, particularly Thanksgiving, Christmas and Easter. Consequently, we generally
experience lower sales and net income in our first and fourth fiscal quarters ending in
August and May, respectively. As a result of these seasonal and quarterly fluctuations,
comparisons of our sales and operating results between different quarters within a single
fiscal year are not necessarily meaningful comparisons.

Changes in consumer demand for shell eggs can negatively impact our business.

As
discussed above, demand for shell eggs has increased in recent years as a result of a
number of factors. We believe that increased fast food restaurant consumption, favorable
reports from the medical community regarding the health benefits of shell eggs, reduced
shell egg cholesterol levels, high protein diet trends and industry advertising campaigns
have all contributed to the increase in shell egg demand. However, there can be no
assurance that the demand for shell eggs will not decline in the future. Adverse publicity
relating to health concerns and changes in the perception of the nutritional value of
shell eggs, as well as movement away from high protein diets, could adversely affect
demand for shell eggs, which would have a material adverse effect on our future results of
operations and financial condition.

Feed costs are volatile and changes in these costs can adversely impact our results of
operations.

Feed
costs represent the largest element of our shell egg production cost, ranging from 53% to
57% of total annual cost in each of the last five fiscal years. Although feed ingredients
are available from a number of sources, we have little, if any, control over the prices of
the ingredients that we purchase, which are affected by various demand and supply factors
and have experienced significant fluctuations in the past. Prices for corn and soybeans,
essential feed ingredients, are favorable this year compared to with last year. However,
there are wide swings in corn and soybean prices because of dry conditions in the Midwest
and widely varying forecast projections for the 2005 fall crop and harvest season in
September and October. Increases in feed costs which are not accompanied by increases in
the selling price of shell eggs will have a material adverse effect on the results of our
operations.

10

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Due to the cyclical nature of our business, our financial results from year to year may
fluctuate.

The
shell egg industry has traditionally been subject to periods of high profitability
followed by periods of significant loss. In the past, during periods of high
profitability, shell egg producers have tended to increase the number of layers in
production with a resulting increase in the supply of shell eggs, which generally has
caused a drop in shell egg prices until supply and demand return to balance. As a result,
our financial results from year to year may vary significantly.

We purchase approximately 25% of the shell eggs we sell from outside producers and our
ability to obtain such eggs at prices and in quantities acceptable to us could fluctuate.

We
produce approximately 75% of the total number of shell eggs sold by us and purchase the
remaining amount from outside producers. As the wholesale price for shell eggs increases,
our cost to acquire shell eggs from outside producers also increases. There can be no
assurance that we will be able to continue to acquire shell eggs from outside producers in
quantities and prices that are satisfactory and our inability to do so may have a material
adverse affect on our business and profitability.

Our
acquisition growth strategy subjects us to various risks.

We
plan to pursue a growth strategy which includes acquisitions of other companies engaged in
the production and sale of shell eggs. Acquisitions can require capital resources and
divert managements attention from our existing business. Acquisitions also entail an
inherent risk that we could become subject to contingent or other liabilities, including
liabilities arising from events or conduct prior to our acquisition of a business that
were not known to us at the time of acquisition. We may also incur significantly greater
expenditures in integrating an acquired business than we had anticipated at the time of
its purchase. We cannot assure you that we:

| |  | will
identify suitable acquisition candidates;
| | - | ----------------------------------------------

| |  | can
consummate acquisitions on acceptable terms; or
| | - | ---------------------------------------------------

| |  | can
successfully integrate any acquired business into our operations or successfully manage
the operations of               any acquired business.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------

No
assurance can be given that companies acquired by us in the future will contribute
positively to our results of operations or financial condition. In addition, federal
anti-trust laws require regulatory approval of acquisitions that exceed certain threshold
levels of significance.

The
consideration we pay in connection with any acquisition also affects our financial
results. If we pay cash, we could be required to use a portion of our available cash to
consummate the acquisition. To the extent we issue shares of our Common Stock, existing
stockholders may be diluted. In addition, acquisitions may result in the incurrence of
debt.

We presently have no understandings or agreements with respect to any acquisitions,
other than the agreement we have entered into for the Hillandale acquisition.

Our largest customers have historically accounted for a significant portion of our net
sales volume. Accordingly, our business may be adversely affected by the loss of, or
reduced purchases by, one or more of our large customers.

For
the fiscal years ended May 28, 2005, and May 29, 2004, one customer, H.E. Butt Grocery
Co., accounted for 12.1% of our net sales and 11.9% of our net sales, respectively, and
two affiliated customers, Wal-Mart Stores and Sams Clubs, on a combined basis,
accounted for 30.8% and 26.8% of our net sales, respectively. Our top 10 customers
accounted for 64.7% and 58.4% of net sales during those periods. Although we have
established long-term relationships with many of our customers, we do not have contractual
relationships with any of our major customers for the sale of our shell eggs. If, for any
reason, one or more of our larger customers were to purchase significantly less of our
shell eggs in the future or were to terminate their purchases from us, and we are not able
to sell our shell eggs to new customers at comparable levels, it would have a material
adverse effect on our business, financial condition and results of operations.

11

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Failure to comply with applicable governmental regulations, including environmental
regulations, could harm our operating results, financial condition and reputation.

We
are subject to federal and state regulations relating to grading, quality control,
labeling, sanitary control and waste disposal. As a fully-integrated shell egg producer,
our shell egg facilities are subject to United States Department of Agriculture, the USDA,
and Food and Drug Administration, the FDA, regulation and various state and local health
and agricultural agencies. Our shell egg processing facilities are subject to periodic
USDA inspections. Our feed production facilities are subject to FDA regulation and
inspections.

Our
operations and facilities are also subject to various federal, state and local
environmental, health and safety laws and regulations governing, among other things, the
generation, storage, handling, use, transportation, disposal and remediation of hazardous
materials. Under these laws and regulations, we are also required to obtain permits from
governmental authorities, including, but not limited to wastewater discharge permits.

If
we fail to comply with any applicable law or regulation or permit, or fail to obtain any
necessary permits, we could be subject to significant fines and penalties or other
sanctions, our reputation could be harmed and our operating results and financial
condition could be materially and adversely affected. In addition, because these laws and
regulations are becoming increasingly more stringent, there can be no assurances that we
will not be required to incur significant costs for compliance with such laws and
regulations in the future.

Our
business is highly competitive.

The
production and sale of fresh shell eggs, which have accounted for virtually all of our net
sales in recent years, is intensely competitive. We compete with a large number of
competitors that may prove to be more successful than we are in marketing and selling
shell eggs. We cannot assure you that we will be able to compete successfully with any or
all of these companies. In addition, increased competition could result in price
reductions, greater cyclicality, reduced margins and loss of market share, which would
negatively affect our business, results of operations and financial condition.

Pressure from animal rights groups regarding the treatment of animals may subject us to
additional costs to conform our practices to comply with developing standards or subject
us to marketing costs to defend challenges to our current practices and protect our image
with our customers.

We
and many of our customers are facing pressure from animal rights groups, such as People
for the Ethical Treatment of Animals, or PETA, to require that any companies that supply
food products operate their business in a manner that treats animals in conformity with
certain standards developed by these animal rights groups. As a result, we are changing
our operating procedures with respect to our flock of hens to meet some or all of these
treatment standards. The treatment standards require, among other things, that we provide
increased cage space for our hens and modify beak trimming and forced molting practices
(the act of putting chickens into a regeneration cycle). Changing our procedures and
infrastructure to conform to these guidelines has resulted and will continue to result in
additional costs to our internal production of shell eggs, including cost increases from
housing and feeding the increased flock population resulting from the modification of
molting practices, and the cost for us to purchase shell eggs from our outside suppliers.
While some of these increased costs have been passed on to our customers, we cannot assure
you that we can continue to pass on these costs, or any additional costs we will face, in
the future.

We are dependent on our management team, and the loss of any key member of this team may
adversely affect the implementation of our business plan in a timely manner.

Our
success depends largely upon the continued services of our senior management team,
including Fred R. Adams, Jr., our chairman and chief executive officer. The loss or
interruption of Mr. Adams services or those of one or more of our other executive
officers could adversely affect our ability to manage our operations effectively and/or
pursue our growth strategy. We have not entered into any employment or non-compete
agreements with any of our executive officers nor do we carry any key-man life insurance
on any such persons.

12

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Agricultural
risks could harm our business.

Our
shell egg production activities are subject to a variety of agricultural risks. Unusual or
extreme weather conditions, disease and pests can materially and adversely affect the
quality and quantity of shell eggs we produce and distribute. If a substantial portion of
our production facilities are affected by any of these factors in any given quarter or
year, our business, financial condition and results of operations could be materially and
adversely affected.

We
are controlled by a principal stockholder.

Fred R. Adams, Jr., our chairman of the board and chief executive officer, and his
spouse own 34.4% of the outstanding shares of our Common Stock, which has one vote per
share, and Mr. Adams owns 90.4% and his son-in-law, Adolphus B. Baker, our president,
chief operating officer and one of our directors, owns 9.6% of the outstanding shares of
Class A Common Stock, which has ten votes per share. Mr. Baker and his spouse also own
1.8% of the outstanding shares of our Common Stock. As a result, currently Mr. Adams and
his spouse possess 66.0%, and Messrs. Adams and Baker and their spouses possess 72.0% of
the total voting power represented by the outstanding shares of our Common Stock and Class
A Common Stock. These stockholdings include shares of our Common Stock accumulated under
our employee stock ownership plan for the respective accounts of Messrs. Adams and Baker.

The
Adams family intends to retain ownership of a sufficient amount of Common Stock and Class
A Common Stock to assure its continued ownership of over 50% of the combined voting power
of our outstanding shares of capital stock. Such ownership will make an unsolicited
acquisition of us more difficult and discourage certain types of transactions involving a
change of control of our company, including transactions in which the holders of Common
Stock might otherwise receive a premium for their shares over then current market prices.
In addition, certain provisions of our Certificate of Incorporation require that our Class
A Common Stock be issued only to Fred R. Adams, Jr. and members of his immediate family,
and that if shares of the Class A Common Stock, by operation of law or otherwise, are
deemed not to be owned by Mr. Adams or a member of his immediate family, the voting power
of any such shares shall be automatically reduced to one vote per share. The Adams family
controlling ownership of our capital stock may adversely affect the market price of our
Common Stock.

Based
on Mr. Adams beneficial ownership of our outstanding capital stock, we are a
controlled company, as defined in Rule 4350(c) (5) of the listing standards of
the NASDAQ National Market on which our shares of Common Stock are quoted. Accordingly, we
are exempt from certain requirements of NASDAQs corporate governance listing
standards, including the requirement to maintain a majority of independent directors on
our board of directors and the requirements regarding the determination of compensation of
executive officers and the nomination of directors by independent directors.

ITEM
2. PROPERTIES

We
operate farms, processing plants, hatcheries, feed mills, warehouses, offices and other
properties located in Arkansas, Georgia, Kansas, Kentucky, Louisiana, Mississippi, New
Mexico, North Carolina, Ohio, South Carolina, Tennessee, Texas and Utah. The facilities
currently include two breeding facilities, one hatchery, two wholesale distribution
centers, 13 feed mills, 19 shell egg production facilities, 18 pullet growing facilities,
and 20 processing and packing facilities Most of our operations are conducted from
properties we own.

Presently,
we own approximately 15,000 acres of land in various locations throughout our geographic
market area. We have the ability to hatch 13 million pullet chicks annually, grow 13
million pullets annually, house 18 million laying hens and control the production of an
aggregate total of 20 million layers. We also own or control mills that can produce 500
tons per hour of feed, and processing facilities capable of processing 7,000 cases of
shell eggs per hour (with each case containing 30 dozen shell eggs). Our facilities are
well-maintained and operate at a high level of efficiency. Typically, we insure our
facilities for replacement value.

13

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Over
the past five fiscal years, our capital expenditures have totaled an aggregate amount of
approximately $65 million. The Companys facilities currently are maintained in good
operable condition and are insured to an extent the Company deems adequate.

ITEM
3. LEGAL PROCEEDINGS

Chicken
Litter Litigation

On
December 26, 2002, Cal-Maine Farms, Inc. (Cal-Maine Farms), a Delaware
corporation wholly owned by us, was served with process in a civil complaint filed in the
Circuit Court of the First Judicial District of Hinds County, Mississippi, on behalf of
plaintiffs, Hunter McWhorter, his two parents, and Michael Green. In addition to Cal-Maine
Farms, Fred Adams, Adolphus Baker, Charles Collins, R. K. Looper and B. J. Raines,
officers of our company, are among the 50 named defendants. Other defendants include
Cargill, Incorporated, Georges Farms, Inc., Peterson Farms, Inc., Simmons Foods,
Inc., Simmons Poultry Farms, Inc., and Tyson Foods, Inc., each of which is engaged in the
broiler business. Individual defendants that were affiliated with the other corporate
defendants also were named in the suit.

The
suit alleges that plaintiffs suffered medical problems from living near land upon which
litter from the flocks of hens owned by certain of the defendants was spread
as fertilizer. The suit specifically addresses conditions alleged to exist in Washington
County, Arkansas, where there is a relatively high concentration of broiler farms.
Cal-Maine Farms is not engaged in any broiler production and, compared to the broiler
producers, has a very small portion of hens located in Washington County. The suit alleges
actual damages in the amount of $55,000,000 and requests punitive damages in the amount of
$100,000,000. On December 31, 2002, an amended complaint was filed, bringing the number of
plaintiffs to 93.

On
November 7, 2003, an Order of Dismissal Without Prejudice was issued by the First Judicial
District of Hinds County, Mississippi. On December 5, 2003, the plaintiffs appealed the
order to the Mississippi Supreme Court which ruled in favor of Cal-Maine and affirmed the
order of dismissal.

On
February 3, 2004, Cal-Maine Farms was served with process in a civil complaint filed in
the Circuit Court of Washington County, Arkansas, on behalf of Keith McWhorter and Patsy
McWhorter, individually and as next friends and guardians of Hunter McWhorter, a plaintiff
in the action described above. Other defendants include Alpharma Inc., Alpharma Animal
Health Co., Cargill, Incorporated, Georges Farms, Inc., Peterson Farms, Inc.,
Simmons Foods, Inc., Simmons Poultry Farms, Inc., and Tyson Foods, Inc., each of which is
engaged in the broiler business, and an individual.

The
suit alleges that the plaintiffs have suffered medical problems resulting from living near
land upon which litter from the defendants flocks was spread as
fertilizer. This suit focuses on a feed ingredient that contains arsenic and is alleged to
be in the litter that was spread. This particular feed ingredient is not used in our shell
egg production feed formulation. The suit, like the suit described above, also addresses
conditions alleged to exist in Washington County. The suit seeks unspecified actual
damages and requests unspecified punitive damages. An answer has been filed on behalf of
Cal-Maine Farms and no discovery has taken place. At this stage, it is impossible to
evaluate the potential exposure, if any, of Cal-Maine Farms to damages in this suit.

Contract
Grower Litigation

On
March 23, 2004, a civil complaint was filed against Cal-Maine Foods, Inc. by Olen L.
Wells, a former contract producer. The complaint was filed in the United States District
Court for the Middle District of Georgia. The complaint alleged that we verbally agreed to
place layer-hen flocks in a particular production facility for a period of ten years if
the plaintiff would install a new feeder system in that facility. The complaint sought
unspecified damages. We filed our answer denying the existence of any such verbal contract
and explaining that all arrangements with contract producers are on a flock-to-flock
basis. The Court ruled in Cal-Maines favor, and the plaintiff agreed not to appeal.

14

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State
of Oklahoma Watershed Pollution Litigation

On
June 18, 2005, the State of Oklahoma filed suit, in the United States District Court for
the Northern District of Oklahoma, against a number of companies, including Cal-Maine
Foods, Inc. Most of the companies are broiler producers. Process has not yet been
served.  Accordingly, no answer is yet due.  No other filings of any nature have
been made. The State of Oklahoma claims that through the disposal of chicken litter the
defendants have polluted the Illinois River Watershed.  This watershed provides water
to eastern Oklahoma.  The Complaint seeks injunctive relief and monetary
damages.  The parties are presently attempting to mediate a resolution of the issues
raised in the Complaint.  The mediation is being conducted in stages.  At
present, the mediation is focused on Oklahomas demand that chicken litter be
disposed of by methods other than as use as fertilizer in the watershed.  Cal-Maine
no longer has any operation in the watershed, so Cal-Maine is not greatly affected by this
aspect of the mediation.  We are not able at present to give an opinion regarding the
ultimate resolution of this action.

ITEM
4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

No
matters were submitted to a vote of our security holders, through the solicitation of
proxies or otherwise, during the fourth quarter of the fiscal year.

# PART II.

ITEM
5. MARKET FOR REGISTRANTS COMMON EQUITY, RELATED SHAREHOLDER MATTERS AND   ISSUER
PURCHASES Of EQUITY SECURITIES

Our
Common Stock is traded on the NASDAQ National Market under the symbol CALM.
The last reported sale price for our Common Stock on August 3, 2005 was $6.34 per share.
The following table sets forth the high and low daily sale prices and dividends for four
quarters of fiscal 2004 and fiscal 2005. The sales prices have been adjusted to reflect
the recent 2-for-1 split of our Common Stock effective April 14, 2004, as if the split had
occurred at the beginning of fiscal 2004.

|                  |                | Sales Price | Dividends
|----------------- | -------------- | ----------- | ---------
|Fiscal Year Ended | Fiscal Quarter | High        | Low      
|May 29, 2004      | First Quarter  | $ 3.900     | $ 2.535  
|                  | Second Quarter | 10.630      | 3.490    
|                  | Third Quarter  | 22.800      | 10.550   
|                  | Fourth Quarter | 21.710      | 10.210   
|May 28, 2005      | First Quarter  | $16.490     | $ 9.800  
|                  | Second Quarter | 14.450      | 9.910    
|                  | Third Quarter  | 14.930      | 9.110    
|                  | Fourth Quarter | 10.550      | 5.720    

There
is no public trading market for the Class A Common Stock, the majority outstanding shares
of which are owned by Fred R. Adams, Jr., Chairman of the Board of Directors and Chief
Executive Officer of the Company.

STOCKHOLDERS

At
July 28, 2005, there were approximately 295 record holders of our
Common Stock and approximately 5,400 beneficial owners whose shares were held by nominees
or broker dealers.

15

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DIVIDENDS

We
have paid cash dividends on our Common Stock since 1998. Prior to the 2-for-1 stock split,
a cash dividend at the annual rate of $0.05 per share of Common Stock, or $0.0125 per
quarter, was paid in each of the full quarters shown in the table above. We expect to pay
cash dividends on our Common Stock at the same annual rate of $0.05 per share on a
post-split basis, thus doubling the aggregate amount of cash dividends payable by us.
Since 1998, we have also paid cash dividends on our Class A Common Stock at a rate equal
to 95% of the annual rate on our Common Stock. Our Board of Directors will continue to
consider the declaration of cash dividends in the future in light of our results of
operations, financial condition, capital requirements for possible acquisitions and new
construction, and other relevant economic factors. In addition, under the terms of
agreements with our principal lenders, we are subject to various financial covenants,
including a limitation on our ability to pay cash dividends in an aggregate amount not to
exceed $500,000 per quarter.

RECENT
SALES OF UNREGISTERED SECURITIES

No
sales of securities without registration under the Securities Act of 1933 occurred during
our fiscal year ended May 28, 2005.

EQUITY
COMPENSATION PLAN INFORMATION

The
following table contains information, as of May 28, 2005, about our equity compensation
plans, all of which were approved by security holders.

|Plan Category                                             | Number of Securities to
Be Issued upon Exercise of
Outstanding Options,
Warrants and Rights
(A) | Weighted Average
Exercise Price of
Outstanding Options,
Warrants and Rights
(B) | Number of Securities
Remaining Available for
Future Issuance Under
Equity Compensation Plans
(Excluding Securities
Reflected in Column (A))
(C)
|--------------------------------------------------------- | ----------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------
|
|Equity Compensation Plans Approved by Security Holders(1) | 128,800                                                                                         | $1.91                                                                           | 8,000                                                                                                                                          

|(1) | Consists
of our 1993 Stock Option Stock Option Plan and our 1999 Stock Option           Plan. See
Note 8 Stock Option Plan in our Consolidated Financial           Statements
for the fiscal year ended May 28, 2005.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

PURCHASES
OF EQUITY SECURITIES

Stock
Repurchase Program

On
August 3, 2004, our Board of Directors approved a repurchase program whereby we may
purchase up to 2,000,000 shares of our Common Stock. The repurchase program expired on
July 31, 2005. We do not have any other stock repurchase programs.

The
following table sets forth the share repurchase activity for the fourth quarter ended May
28, 2005:

16

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|                                   | Thirteen Weeks February 26, 2005 to May 28, 2005
|---------------------------------- | ------------------------------------------------
|
|February 26, 2005 - March 26, 2005 | 50,000                                          
|March 26, 2005 - April 23, 2005    | 50,000                                          
|April 23, 2005 - May 28, 2005      | 140,000                                         
|                                   |                                                 
|Total                              | 240,000                                         
|                                   |                                                 

ITEM
6. SELECTED FINANCIAL DATA

The
per share data shown in the following table has been adjusted to reflect the 2-for-1 split
of our Common Stock effective April 14, 2004, as if the split had occurred at the
beginning of fiscal year 2001.

|                                             
|---------------------------------------------
|May 28,
2005                                 
|(Amounts in thousands, except per share data)
|Statement of Operations Data:                
|Net sales                                    
|Cost of sales                                
|                                             
|Gross profit                                 
|Selling, general and administrative          
|                                             
|Operating income (loss)                      
|Other income (expense):                      
|Interest expense (net)                       
|Equity in income (loss) of affiliates        
|Other (net)                                  
|                                             
|                                             
|                                             
|Income (loss) before income tax              
|Income tax expense (benefit)                 
|                                             
|Net income (loss)                            
|                                             
|Net income (loss) per common share:          
|Basic                                        
|                                             
|Diluted                                      
|                                             
|Cash dividends declared per share            
|                                             
|Weighted average shares outstanding:         
|Basic                                        
|                                             
|Diluted                                      
|                                             
|Balance Sheet Data:                          
|Working capital                              
|Total assets                                 
|Total debt (including current portion)       
|Total stockholders' equity                   
|Operating Data:                              
|Total number of layers at                    
|period ended (thousands)                     
|Total shell eggs sold (millions of dozens)   

17

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ITEM
7. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIALCONDITION AND RESULTS OF
OPERATIONS

Risk
Factors; Forward-Looking Statements

For
information relating to important risks and uncertainties that could materially adversely
affect our business, securities, financial condition or operating results, reference is
made to the disclosure set forth under Item 1 above under the caption Risk
Factors. In addition, because the following discussion includes numerous
forward-looking statements relating to us, our results of operations and financial
condition and business, reference is made to the information set forth above in Item 1
under the caption Important Factors Relating to Forward-Looking Statements.

OVERVIEW

We
are primarily engaged in the production, grading, packing, and sale of fresh shell eggs.
Our fiscal year end is the Saturday nearest to May 31 which was May 28, 2005 (52 weeks),
May 29, 2004 (52 weeks) and May 31, 2003 (52 weeks) for the most recent three fiscal years.

Our
operations are fully integrated. At our facilities we hatch chicks, grow pullets,
manufacture feed, and produce, process, and distribute shell eggs. We currently are the
largest producer and distributor of fresh shell eggs in the United States. Shell eggs
accounted for approximately 96% of our net sales in fiscal 2005 and fiscal 2004. We
primarily market our shell eggs in the southwestern, southeastern, mid-western and
mid-Atlantic regions of the United States. Shell eggs are sold directly by us primarily to
national and regional supermarket chains.

We
currently use contract producers for approximately 12% of our total egg production.
Contract producers operate under agreements with us for the use of their facilities in the
production of shell eggs by layers owned by us. We also own the eggs produced. Also, shell
eggs are purchased, as needed, for resale by us from outside producers.

Our
operating income or loss is significantly affected by wholesale shell egg market prices,
which can fluctuate widely and are outside of our control. Retail sales of shell eggs are
greatest during the fall and winter months and lowest during the summer months. Prices for
shell eggs fluctuate in response to seasonal factors and a natural increase in egg
production during the spring and early summer.

Our
cost of production is materially affected by feed costs, which average about 55% of our
total farm egg production cost. Changes in feed costs result in changes in our cost of
goods sold. The cost of feed ingredients is affected by a number of supply and demand
factors such as crop production and weather, and other factors, such as the level of grain
exports, over which we have little or no control.

18

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RESULTS
OF OPERATIONS

The
following table sets forth, for the years indicated, certain items from our consolidated
statements of operations expressed as a percentage of net sales.

|                                          
|------------------------------------------
|May 28, 2005                              
|Net sales                                 
|Cost of sales                             
|                                          
|Gross profit                              
|Selling, general & administrative expenses
|                                          
|Operating income  (loss)                  
|Other income (expense)                    
|                                          
|Income (loss) before taxes                
|Income tax expense (benefit)              
|                                          
|Net income  (loss)                        
|                                          

Fiscal
Year Ended May 28, 2005 Compared to Fiscal Year Ended May 29, 2004

Net Sales.Approximately 96% of our net sales consist of shell egg sales.
Approximately 3% of our net sales include incidental feed sales to outside egg producers,
with the 1% balance consisting of net sales from other farming activities. Net sales for
the fiscal year ended May 28, 2005 were $375.3 million, a decrease of $197.0 million, or
34.4%, from net sales of $572.3 million for fiscal 2004. Total dozens of eggs sold and egg
selling prices decreased as compared to fiscal 2004. In fiscal 2005, total dozens of shell
eggs sold were 575.4 million, a decrease of 29.8 million dozen, or 4.9%, compared to 605.2
million dozen sold in fiscal 2004. Our average selling price of shell eggs decreased from
$.914 per dozen for fiscal 2004 to $.625 per dozen for fiscal 2005, a decrease of $.289
per dozen, or 32.0%. Our operating results are significantly affected by wholesale shell
egg market prices, which are outside of our control. Small changes in production or demand
levels can have a large effect on shell egg prices. During fiscal 2004 and the first
quarter of fiscal 2005, consumer demand increased. This increase in demand was partially
due to the popularity of high protein diets. At the start of fiscal 2004, egg supply was
level and, during fiscal 2004, egg producers increased egg supply to meet consumer demand.
During our second fiscal 2005 quarter, consumer demand decreased to normal levels. At this
same time, egg supply continued at the higher levels and resulted in a drop in egg selling
prices for the remainder of fiscal 2005.

Cost of Sales.Cost of sales consists of costs directly related to production and
processing of shell eggs, including feed costs, and purchases of shell eggs from outside
egg producers. Cost of sales for the fiscal year ended May 28, 2005 was $339.8 million, a
decrease of $56.9 million, or 14.3%, as compared to cost of sales of $396.7 million for
fiscal 2004. Dozens sold, cost of purchases from outside shell egg producers and cost of
feed ingredients decreased in fiscal 2005. Dozens produced in our facilities decreased
5.0% and dozens purchased from outside shell egg producers decreased 4.5%. The decrease in
the cost of the shell eggs purchased from outside producers was due to lower egg market
selling prices. Feed cost for fiscal 2005 was $.225 per dozen, compared to $.234 per dozen
for the prior fiscal year, a decrease of 3.8%. A 32.0% decrease in egg selling prices,
offset by a small decrease in feed ingredient costs and lower cost of purchases from
outside egg producers, resulted in a decrease in gross profit from 30.7% of net sales for
fiscal 2004 to 9.4% of net sales for fiscal 2005.

19

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Selling, General and Administrative Expenses.Selling, general and administrative
expenses include costs of marketing, distribution, accounting and corporate overhead.Selling, general and administrative expense was $47.8 million in fiscal 2005, a
decrease of $21.5 million as compared to $69.3 million for fiscal 2004. In fiscal 2004, we
recorded $22.1 million for stock compensation expense as compared to a benefit of $1.3
million for fiscal 2005, applicable to stock options and Tandem Stock Appreciation Rights
accounted for under the variable plan accounting requirements of APB Opinion No.25,
Accounting for Stock Issued to Employees. The market price of our outstanding
common stock ranged from $2.62 at May 31, 2003 to $13.80 at May 29, 2004 to $6.76 at May
28, 2005. Excluding the stock compensation expense, fiscal 2005 selling, general and
administrative expense was $49.1 million compared to $47.2 million for fiscal 2004, an
increase of $1.9 million, or 4.0%. The increase is due to increases in general insurance,
franchise fees, employee health benefits, fuel costs, and costs to comply with the
internal control reporting requirements of the Sarbanes-Oxley Act. On a cost per dozen
sold basis, excluding the stock compensation expense, selling, general and administrative
expense was $0.083 for fiscal 2005 as compared to $0.080 for fiscal 2004. As discussed
above, total dozens sold in fiscal 2005 decreased 4.9%. As a percent of net sales,
selling, general and administrative expense increased from 12.1% for fiscal 2004 to 12.7%
for fiscal 2005.

Operating Income(Loss) .As a result of the above, our operating loss was $12.3
million for fiscal 2005, as compared to operating income of $106.3 million for fiscal
2004. As a percent of net sales, the operating loss for fiscal 2005 was 3.3%, as compared
to operating income of 18.6% for fiscal 2004.

Other Income (Expense).Other income or expense consists of costs or income not
directly charged to, or related to, operations such as interest expense and equity in
income of affiliates. Other expense for fiscal 2005 was $3.1 million as compared to other
expense of $80,000 for fiscal 2004. For fiscal 2005, net interest expense decreased $2.3
million, the net result of a $1.7 million decrease in interest expense and a $600,000
increase in interest income. Interest expense decreased due to reduced long-term debt
balances and additional interest income was received from cash equivalent investments.
Other income for fiscal 2005 decreased from equity in lower income of affiliates. As a
percent of net sales, other expense was 0.8% for fiscal 2005, as compared to 0.1% for
fiscal 2004.

Income Taxes.For the fiscal year ended May 28, 2005, our pre-tax loss was $15.4
million, as compared to pre-tax income of $106.2 million for fiscal 2004. For fiscal 2005,
an income tax benefit of $5.0 million was recorded with an effective tax rate of 32.8%, as
compared to an income tax expense of $39.8 million with an effective tax rate of 37.5% for
fiscal 2004.

Net Income.As a result of the above, net loss for fiscal 2005 was $10.4 million, or
$0.43 per basic and diluted share, compared to net income of $66.4 million, or $2.78 per
basic share, or $2.73 per diluted share, for fiscal 2004.

Fiscal
Year Ended May 29, 2004 Compared to Fiscal Year Ended May 31, 2003

Net Sales.Approximately 96% of our net sales consist of shell egg sales.
Approximately 3% of our net sales include incidental feed sales to outside egg producers,
with the 1% balance consisting of other farming activities. Net sales for the fiscal year
ended May 29, 2004 were $572.3 million, an increase of $184.8 million, or 47.7%, from net
sales of $387.5 million for fiscal 2003. Total dozens of eggs sold increased in fiscal
2004 and egg selling prices increased as compared with prices in fiscal 2003. In fiscal
2004, total dozens of shell eggs sold were 605.2 million, an increase of 34.5 million
dozen, or 6.0%, compared to 570.7 million dozen sold in fiscal 2003. Consumer demand was
good and egg supply was level, which resulted in higher egg selling prices during fiscal
2004. Our average selling price of shell eggs increased from $.645 per dozen for fiscal
2003 to $.914 per dozen for fiscal 2004, an increase of $.269 per dozen, or 41.7%. We
believe our financial results for the past fiscal year have been positively affected by
increased demand, primarily caused by favorable publicity about eggs from the medical
community, increased use of eggs in high protein diets that are currently popular and a
level egg supply within the industry.

Cost of Sales.Cost of sales consists of costs directly related to production and
processing of shell eggs, including feed costs, and purchases of shell eggs from outside
egg producers. Cost of sales for the fiscal year ended May 29, 2004 was $396.7 million, an
increase of $81.5 million, or 25.9%, as compared to cost of sales of $315.2 million for
fiscal 2003. Dozens sold, cost of purchases from outside egg producers and cost of feed
ingredients increased in fiscal 2004. During fiscal 2003, we recognized $9.5 million as a
reduction in cost of sales for our share of the settlement of certain class action feed
ingredient lawsuits. The 6.0 % increase in dozens sold was from increases in dozens
produced in our facilities and in the number of dozens purchased from outside egg
producers. The increase in the cost of the eggs purchased from outside producers was due
to higher egg market selling prices. Feed cost for fiscal 2004 was $.234 per dozen,
compared to $.213 per dozen for the prior fiscal year, an increase of 10.0%. A 41.7%
increase in egg selling prices, offset by higher feed ingredient costs and higher cost of
purchases from outside egg producers, resulted in an increase in gross profit from 18.7%
of net sales for fiscal 2003 to 30.7% of net sales for fiscal 2004.

20

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Selling, General and Administrative Expenses.Selling, general and administrative
expenses include costs of marketing, distribution, accounting and corporate overhead.Selling, general and administrative expense was $69.3 million in fiscal 2004, an
increase of $23.3 million as compared to an expense of $46.0 million for fiscal 2003. For
fiscal 2004, we recorded an expense of $22.1 million for stock compensation due to the
increase in the market price of our outstanding common stock from $2.62 at May 31, 2003 to
$13.80 at May 29, 2004, as compared to an expense of $1.1 million for fiscal 2003.
Excluding the $21.0 million increase in stock compensation expense, the fiscal 2004 year
increase for selling, general and administrative expense was $2.3 million, or 5.0%. The
increase is the net of increases in legal and professional fees, general insurance and
franchise fees, offset by a reduction in bad debt expense. The biggest increase,
approximately $2.4 million was for legal and professional fees, primarily related to our
going private transaction that was terminated in November 2003 and our proposed
underwritten public offering of common stock that was withdrawn in April 2004. In fiscal
2003, one of our customers filed for bankruptcy and we increased our bad debt allowance by
$1.1 million. Due to the increased sales volume in fiscal 2004, general administrative
expenses increased slightly. On a cost per dozen sold basis, excluding the $21.0 million
increase in stock compensation expense, selling, general and administrative expense was
$0.080 for fiscal 2004 as compared to $0.076 for fiscal 2003. As a percent of net sales,
selling, general and administrative expense increased from 11.9% for fiscal 2003 to 12.1%
for fiscal 2004.

Operating Income .As a result of the above, our operating income was $106.3 million
for fiscal 2004, as compared to operating income of $26.3 million for fiscal 2003. As a
percent of net sales, the operating income for fiscal 2004 was 18.6%, as compared to
operating income of 6.8% for fiscal 2003.

Other Income (Expense).Other income or expense consists of costs or income not
directly charged to, or related to, operations such as interest expense and equity in
income of affiliates. Other expense for fiscal 2004 was $80,000, a decrease of $7.0
million, as compared to other expense of $7.1 million for fiscal 2003. For fiscal 2004,
net interest expense decreased $1.6 million and other income increased $5.4 million. Net
interest expense decreased as the result of reduced long term debt balances and receipt of
$944,000 interest income as part of an income tax refund. Other income for fiscal 2004
increased from equity in income of affiliates. As a percent of net sales, other expense
was 0.1% for fiscal 2004, as compared to 1.8% for fiscal 2003.

Income Taxes.For the fiscal year ended May 29, 2004, our pre-tax income was $106.2
million, as compared to pre-tax income of $19.1 million for fiscal 2003. For fiscal 2004,
an income tax expense of $39.8 million was recorded with an effective tax rate of 37.5%,
as compared to an income tax expense of $6.9 million with an effective tax rate of 36.2%
for fiscal 2003.

Net Income.As a result of the above, net income for fiscal 2004 was $66.4 million, or
$2.78 per basic share, or $2.73 per diluted share, compared to net income of $12.2
million, or $0.52 per basic share, or $.515 per diluted share, for fiscal 2003.

Capital Resources and Liquidity.Our working capital at May 28, 2005 was
$73.6 million compared to $92.9 million at May 29, 2004. Our current ratio was 2.41 at May
28, 2005 as compared with 2.58 at May 29, 2004. Our need for working capital generally is
highest in the first and second fiscal quarters ending in August and November. During the
first quarter shell egg prices are normally at seasonal lows. In the second quarter, we
usually build inventory balances in anticipation of the holiday season. Seasonal borrowing
needs frequently are higher during these periods than during other fiscal periods. We have
a $35 million line of credit with three banks, $2.6 million of which was utilized as a
standby letter of credit at May 28, 2005. Our long-term debt at that date, including
current maturities, totaled $83.0 million, as compared to $90.0 million at May 29, 2004.

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For
the fiscal year ended May 28, 2005, $9.6 million in net cash was provided by operating
activities. This compares to $85.1 million of net cash for fiscal year ended May 29, 2004.
In fiscal 2005, $12.0 million was used for purchases of property, plant and equipment, and
$879,000 was received from sales of property, plant and equipment. Net cash of $13.9
million was used in investments and payments of $1.3 million were received on notes
receivable. Approximately $9.0 million was used for net purchases of common stock for the
treasury, and $1.2 million was used for payments of dividends on our common stock.
Proceeds from long-term borrowings of $2.5 million were received in additional long-term
debt and payments of $9.5 million were made on long-term debt. The net result was a
decrease in cash and cash equivalents of approximately $31.3 million.

For
the fiscal year ended May 29, 2004, $85.1 million in net cash was provided by operating
activities. In fiscal 2004, $8.7 million was used for purchases of property, plant and
equipment, $594,000 was received from sales of property, plant and equipment, and $2.0
million was used for construction projects. Net cash of $19.1 million was used in
investments and a decrease in notes receivable. Approximately $8.4 million was received
from the exercise of stock options, and $746,000 was used for payments of dividends on our
common stock. Long-term borrowings of $5.0 million were received and $20.0 million was
received in restructuring and re-pricing certain other long-term debt. Payments of $43.2
million were made on long-term debt. The net result was an increase in cash and cash
equivalents of approximately $45.4 million.

Substantially
all trade receivables and inventories collateralize our line of credit and property, plant
and equipment collateralize our long-term debt under our loan agreements with our lenders.
Unless otherwise approved by our lenders, we are required by provisions of these loan
agreements to (1) maintain minimum levels of working capital (ratio of not less than 1.25
to 1) and net worth (minimum of $90.0 million tangible net worth, and, effective with
fiscal 2005 year end, 45% of cumulative net income); (2) limit dividends to an aggregate
amount not to exceed $500,000 per quarter (allowed if no default), capital expenditures
(not to exceed depreciation for the same four fiscal quarters), lease obligations and
additional long-term borrowings (total funded debt to total capitalization not to exceed
55%); and (3) maintain various current and cash-flow coverage ratios (1.25 to 1), among
other restrictions. At May 28, 2005, we were in compliance with the provisions of all loan
agreements. Under certain of the loan agreements, the lenders have the option to require
the prepayment of any outstanding borrowings in the event we undergo a change in control.

Under
the terms of our Agreement with Hillandale and the Hillandale shareholders, the egg
production and marketing operations to be acquired and liabilities to be assumed by us
will be transferred to a new Florida limited liability company named Hillandale, LLC. The
two Hillandale companies will be the initial members of Hillandale, LLC, for formation
purposes. Upon the completion of an evaluation of the assets and liabilities to be
acquired and assumed by us, as agreed to by the parties to the Agreement, we will purchase
51% of the Units of Membership in Hillandale, LLC. The remaining 49% of the Units of
Membership in Hillandale, LLC, are to be acquired in essentially equal annual installments
over a four-year period, with the purchase price of the units equal to their book value as
calculated in accordance with the terms of the Agreement. The acquisition will be made for
cash, from our available funds, and borrowings to the extent necessary. We will acquire
our initial 51% interest in Hillandale, LLC, at a presently estimated cost of
approximately $30 to $35 million, subject to adjustment upwards or downwards, based upon
the valuations agreed upon by the parties to the Agreement. Funding of the Hillandale
acquisition is expected to be provided by our cash balances and possible borrowings that
may be secured by the assets acquired.

We
project capital expenditures of an aggregate of approximately $10.3 million during fiscal
2006.

We
currently have a $2.2 million deferred tax liability due to a subsidiarys change
from a cash basis to an accrual basis taxpayer on May 29, 1988. The Taxpayer Relief Act of
1997 provides that this liability is payable ratably over the 20 years beginning in fiscal
1999. However, such taxes will be due in their entirety in the first fiscal year in which
there is a change in ownership control so that we no longer qualify as a family farming
corporation. We are currently making annual payments of approximately $150,000 related to
this liability. However, while these current payments reduce cash balances, payment of the
$2.1 million deferred tax liability would not impact our consolidated statement of
operations or stockholders equity, as these taxes have been accrued and are
reflected on our consolidated balance sheet. See Note 9 of Notes to Consolidated Financial
Statements.

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We
believe that our existing cash and investments, as well as our unused lines of credit, if
needed, will satisfy our foreseeable working capital requirements for at least the next
twelve months.

Off-Balance
Sheet Arrangements

We
have no existing off-balance sheet arrangements as defined under SEC regulations.

Contractual
Obligations

The
following table summarizes future estimated cash payments, in thousands, to be made under
existing contractual obligations. Further information on debt obligations is contained in
Note 6, and on lease obligations in Note 5, of Notes to Consolidated Financial Statements.
The table does not reflect the obligations incurred by us for the Hillandale acquisition,
the exact amounts of which are to be determined under the terms of the Agreement. At the
closing of the Hillandale transaction, we will purchase 51% of the Units of Membership in
Hillandale, LLC at a presently estimated cost of approximately $30 to $35 million, subject
to adjustment upwards or downwards, based on valuations agreed to by the parties to the
Agreement. We will incur costs, which cannot now be estimated, for our purchase of the
remaining 49% of the Units of Membership over the four-year period following the closing.

|                 | Total | 2006 | 2007 | 2008    | 2009 | 2010 | Over 5 years
|---------------- | ----- | ---- | ---- | ------- | ---- | ---- | ------------
|Long-term debt   |       |      | $    | 82,993  |      | $    | 10,149      
|Operating leases |       |      | $    | 25,410  |      | $    | 8,373       
|                 |       |      |      |         |      |      |             
|Total            |       |      | $    | 108,403 |      | $    | 18,522      

Impact
of Recently Issued Accounting Standards.

In
November 2004, the FASB issued Statement of Financial Accounting Standards
(SFAS) No. 151, Inventory Costs. SFAS No. 151 amends Accounting
Research Bulletin (ARB) No. 43, Chapter 4, to clarify that abnormal amounts of
idle facility expense, freight, handling costs and spoilage should be recognized as
current-period charges. In addition, SFAS No. 151 requires that allocation of fixed
production overhead to inventory be based on the normal capacity of the production
facilities. SFAS No. 151 is effective for inventory costs incurred during fiscal years
beginning after June 15, 2005. We are currently assessing the impact that SFAS No. 151
will have on the results of operations, financial position or cash flows.

In
December 2004, the FASB issued SFAS No. 123 (Revised 2004), Share-Based
Payment (SFAS No. 123(R)), which replaces SFAS No. 123, Accounting
for Stock-Based Compensation, and supercedes APB No. 25, Accounting for Stock
Issued to Employees. SFAS 123(R) required companies to measure compensation costs
for share-based payments to employees, including stock options, at fair value and expense
such compensation over the service period beginning with the first annual period after
December 15, 2005. The pro forma disclosures previously permitted under SFAS No. 123 will
no longer be an alternative to financial statement recognition. The Company expects to
adopt SFAS No. 123(R) in the first quarter of fiscal 2007. FAS No. 123(R) permits public
companies to adopt its requirement using either a modified prospective method or a
modified retrospective method. Under the modified prospective method, companies are
required to record compensation cost for new and modified awards over the related vesting
period of such awards prospectively and record compensation cost prospectively for the
unvested portion, at the date of adoption, of previously issued and outstanding awards
over the remaining vesting period of such awards. No change to prior periods presented is
permitted under the modified prospective method. Under the modified retrospective method,
companies record compensation costs for prior periods retroactively through restatement of
such periods using the proforma amounts previously disclosed in the footnotes. Also, in
the period of adoption and after, companies record compensation cost based on the modified
prospective method. We have not yet determined the method of adoption we will use, and we
cannot currently estimate the future effects of adopting this new guidance.

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Critical Accounting Policies.The preparation of financial statements in
accordance with accounting standards generally accepted in the United States requires
management to make estimates and assumptions that affect the reported amounts of assets
and liabilities at the date of the financial statements and the reported amounts of
revenues and expenses during the reporting period. Actual results could differ from these
estimates.

Management
suggests that our Summary of Significant Accounting Policies, as described in Note 1 of
the Notes to Consolidated Financial Statements, be read in conjunction with this
Managements Discussion and Analysis of Financial Condition and Results of
Operations. We believe the critical accounting policies that most impact our consolidated
financial statements are described below.

Allowance for Doubtful Accounts. In the normal course of business, we extend credit
to our customers on a short-term basis. Although credit risks associated with our
customers are considered minimal, we routinely review our accounts receivable balances and
make provisions for probable doubtful accounts. In circumstances where management is aware
of a specific customers inability to meet its financial obligations to us (e.g.
bankruptcy filings), a specific reserve is recorded to reduce the receivable to the amount
expected to be collected. For all other customers, we recognize reserves for bad debts
based on the length of time the receivables are past due, generally 100% for amounts more
than 60 days past due.

Inventories. Inventories of eggs, feed, supplies and livestock are valued           principally
at the lower of cost (first-in, first-out method) or market. If           market prices
for eggs and feed grains move substantially lower, we would record           adjustments
to write-down the carrying values of eggs and feed inventories to           fair market
value. The cost associated with flock inventories, consisting           principally of
chick purchases, feed, labor, contractor payments and overhead           costs, are
accumulated during the growing period of approximately 18 weeks.           Capitalized
flock costs are then amortized over the productive lives of the           flocks,
generally one to two years. Flock mortality is charged to cost of sales           as
incurred. High mortality from disease or extreme temperatures would result in
          abnormal adjustments to write-down flock inventories. Management continually
          monitors each flock and attempts to take appropriate actions to minimize the
          risk of mortality loss.

Long-Lived Assets. Depreciable long-lived assets are primarily comprised of buildings
and improvements and machinery and equipment. Depreciation is provided by the
straight-line method over the estimated useful lives, which are 15 to 25 years for
buildings and improvements and 3 to 12 years for machinery and equipment. An increase or
decrease in the estimated useful lives would result in changes to depreciation expense. We
continually reevaluate the carrying value of our long-lived assets, for events or changes
in circumstances, which indicate that the carrying value may not be recoverable. As part
of this reevaluation, we estimate the future cash flows expected to result from the use of
the asset and its eventual disposal. If the sum of the expected future cash flows
(undiscounted and without interest charges) is less than the carrying amount of the asset,
an impairment loss is recognized to reduce the carrying value of the long-lived asset to
the estimated fair value of the asset.

Investment in Affiliates. We have invested in other companies engaged in the
production, processing and distribution of shell eggs and egg products. Our ownership
percentages in these companies range from less than 20% to 50%. Therefore, these
investments are recorded using the cost or the equity method, and accordingly, not
consolidated in our financial statements. Changes in the ownership percentages of these
investments might alter the accounting methods currently used. Our investment in these
companies amounted to $8.5 million at May 28, 2005. The combined total assets and total
liabilities of these companies were approximately $30 million and $14 million,
respectively, at May 28, 2005. We are a guarantor of approximately $6.0 million of
long-term debt of one of the affiliates.

Goodwill. At May 28, 2005, our goodwill balance represented 1.2% of total           assets and
2.6% of stockholders equity. Goodwill relates to the fiscal           1999
acquisition of Hudson Brothers, Inc. We adopted, as of June 3, 2001,           Statement
of Financial Accounting Standards No. 142, Goodwill and Other           Intangible
Assets (SFAS 142). Under SFAS 142, goodwill and indefinite           lived
intangible assets are no longer amortized but are reviewed annually or           more
frequently if impairment indicators arise, for impairment. An impairment           loss
would be recorded if the recorded goodwill exceeds its implied fair value.           We
have only one operating segment, which is our sole reporting unit.           Accordingly,
goodwill is tested for impairment at the entity level. Significant           adverse
industry or economic changes, or other factors not anticipated could           result in
an impairment charge to reduce recorded goodwill.

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Income Taxes. We determine our effective tax rate by estimating our permanent
differences resulting from differing treatment of items for tax and accounting purposes.
We are periodically audited by taxing authorities. Any audit adjustments affecting
permanent differences could have an impact on our effective tax rate.

Forward Looking Statements. The foregoing statements contain
forward-looking statements which involve risks and uncertainties and our actual experience
may differ materially from that discussed above. Factors that may cause such a difference
include, but are not limited to, those discussed in Factors Affecting Future
Performance below, as well as future events that have the effect of reducing our
available cash balances, such as unanticipated operating losses or capital expenditures
related to possible future acquisitions. Readers are cautioned not to place undue reliance
on forward-looking statements, which reflect managements analysis only as the date
hereof. We assume no obligation to update forward-looking statements.

Factors Affecting Future Performance.Our future operating results may be
affected by various trends and factors which are beyond our control. These include adverse
changes in shell egg prices and in the grain markets. Accordingly, past trends should not
be used to anticipate future results and trends. Further, our prior performance should not
be presumed to be an accurate indication of future performance.

ITEM
7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS

Our interest expense is sensitive to
changes in the general level of U.S. interest rates. We maintain certain of our debt as
fixed rate in nature to mitigate the impact of fluctuations in interest rates. Under our
current policies, we do not use interest rate derivative instruments to manage our
exposure to interest rate changes. A 1% adverse move (decrease) in interest rates would
adversely affect the net fair value of our debt by $3.3 million at May 28, 2005. We are a
party to no other market risk sensitive instruments requiring disclosure.

ITEM
8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Managements
Report on Internal Control Over Financial Reporting

The
following sets forth, in accordance with Section 404(a) of the Sarbanes-Oxley Act of 2002
and Item 308 of the Securities and Exchange Commissions Regulation S-K, the
report of management on our internal control over financial reporting.

1.                 Our
management is responsible for establishing and maintaining adequate internal
          control over financial reporting. Internal control over financial
          reporting is a process designed by, or under the supervision of, our
Chief           Executive Officer and Chief Financial Officer, together with other
financial           officers, and effected by our Board of Directors, management and
other           personnel, to provide reasonable assurance regarding the reliability of
          financial reporting and the preparation of financial statements for external
          purposes in accordance with generally accepted accounting principles and
          includes those policies and procedures that:

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| |  | Pertain
to the maintenance of records that in reasonable detail accurately and fairly reflect the
transactions and                   dispositions of our assets;
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Provide
reasonable assurance that transactions are recorded as necessary to permit preparation of
financial statements in accordance with generally accepted accounting principles, and
that our receipts and expenditures are being made only in accordance with authorizations
of our management and directors; and
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Provide
reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use or disposition of our assets that could have a material effect on the
financial statements.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

2.                 Our
management, in accordance with Rule 13a-15(c) under the Securities Exchange           Act
of 1934 and with the participation of our Chief Executive Officer and Chief
          Financial Officer, together with other financial officers, evaluated the
          effectiveness of our internal control over financial reporting as of May 28,
          2005. The framework on which managements evaluation of our internal
          control over financial reporting is based is the Internal Control           Integrated
Frameworkpublished in 1992 by the Committee of           Sponsoring
Organizations (COSO) of the Treadway Commission.

3.                 We
maintain documentation providing reasonable support for managements
          assessment of the effectiveness of our internal control over financial
          reporting. Managements documentation includes:

| |  | The
design of controls over all relevant assertions related to all significant accounts and
disclosures in the financial                   statements;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Information
about how significant transactions are initiated, authorized, recorded, processed and
reported;
| | - | -----------------------------------------------------------------------------------------------------------

| |  | Sufficient
information about the flow of transactions to identify the points at which material
misstatements due to error or fraud could occur;
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------

| |  | Controls
designed to prevent or detect fraud, including who performs the controls and the related
segregation of duties;
| | - | ------------------------------------------------------------------------------------------------------------------------

| |  | Controls
over the period-end financial reporting process;
| | - | ---------------------------------------------------------

| |  | Controls
over safeguarding of assets; and
| | - | -----------------------------------------

| |  | The
results of management's testing and evaluation.
| | - | ---------------------------------------------------

4.                 Management
has determined that our internal control over financial reporting as           of May 28,
2005, is effective and that there is no material weakness in our           internal
control over financial reporting as of that date. In that connection, a           material
weakness, is a significant deficiency, or a combination of           significant
deficiencies, that results in more than a remote likelihood that a           material
misstatement of the financial statements will not be prevented or           detected. A
significant deficiency is a control deficiency or a           combination of
control deficiencies, that adversely affects our ability to           initiate,
authorize, record, process, or report external financial data reliably           in
accordance with generally accepted accounting principles such that there is
          more than a remote likelihood that a misstatement of our financial statements
          that is more than inconsequential will not be prevented or detected. A
          control deficiency exists when the design or operation of a control
          does not allow management or employees, in the normal course of performing
their           assigned functions, to prevent or detect misstatements on a timely basis.
It is           noted that internal control over financial reporting cannot provide
absolute           assurance of achieving financial reporting objectives, but rather
reasonable           assurance of achieving such objectives.

5.                 The
attestation report of Ernst & Young LLP on managements assessment           of
our internal control over financial reporting, which includes that           firms
opinion on managements assessment of the effectiveness of           internal
control over financial reporting and opinion on the effectiveness of           internal
control over financial reporting, is set forth below.

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# Report of Independent
Registered Public Accounting Firm on Internal Control Over Financial Reporting

The Board of Directors
and StockholdersCal-Maine Foods, Inc.

We have audited managements
assessment, included in the accompanying Managements Report on Internal Control over
Financial Reporting, that Cal-Maine Foods, Inc. maintained effective internal control over
financial reporting as of May 28, 2005 based on criteria established in Internal
Control  Integrated Framework issued by the Committee of Sponsoring Organizations of
the Treadway Commission (the COSO criteria). Cal-Maine Foods, Inc.s management is
responsible for maintaining effective internal control over financial reporting and for
its assessment of the effectiveness of internal control over financial reporting. Our
responsibility is to express an opinion on managements assessment and an opinion on
the effectiveness of the Companys internal control over financial reporting based on
our audit.

We conducted our audit in accordance
with the standards of the Public Company Accounting Oversight Board (United States). Those
standards require that we plan and perform the audit to obtain reasonable assurance about
whether effective internal control over financial reporting was maintained in all material
respects. Our audit included obtaining an understanding of internal control over financial
reporting, evaluating managements assessment, testing and evaluating the design and
operating effectiveness of internal control, and performing such other procedures as we
considered necessary in the circumstances. We believe that our audit provides a reasonable
basis for our opinion.

A companys internal control
over financial reporting is a process designed to provide reasonable assurance regarding
the reliability of financial reporting and the preparation of financial statements for
external purposes in accordance with generally accepted accounting principles. A
companys internal control over financial reporting includes those policies and
procedures that (1) pertain to the maintenance of records that, in reasonable detail,
accurately and fairly reflect the transactions and dispositions of the assets of the
company; (2) provide reasonable assurance that transactions are recorded as necessary
to permit preparation of financial statements in accordance with generally accepted
accounting principles, and that receipts and expenditures of the company are being made
only in accordance with authorizations of management and directors of the company; and
(3) provide reasonable assurance regarding prevention or timely detection of
unauthorized acquisition, use, or disposition of the companys assets that could have
a material effect on the financial statements.

Because of its inherent limitations,
internal control over financial reporting may not prevent or detect misstatements. Also,
projections of any evaluation of effectiveness to future periods are subject to the risk
that controls may become inadequate because of changes in conditions, or that the degree
of compliance with the policies or procedures may deteriorate.

In our opinion, managements
assessment that Cal-Maine Foods, Inc. maintained effective internal control over financial
reporting as of May 28, 2005, is fairly stated, in all material respects, based on
the COSO criteria. Also, in our opinion, Cal-Maine Foods, Inc. maintained, in all material
respects, effective internal control over financial reporting as of May 28, 2005,
based on the COSO criteria.

27

---

We also have audited, in accordance
with the standards of the Public Company Accounting Oversight Board (United States), the
consolidated balance sheets of Cal-Maine Foods, Inc. as of May 28, 2005 and May 29, 2004,
and the related consolidated statements of operations, stockholders equity, and cash
flows for the years ended May 28, 2005, May 29, 2004, and May 31, 2003, and
our report dated August 5, 2005 expressed an unqualified opinion thereon.

| | /s/
Ernst & Young LLP
| | ---------------------

New Orleans, LouisianaAugust
5, 2005

28

---

Report of Independent
Registered Public Accounting Firm

The Board of Directors
and StockholdersCal-Maine Foods, Inc.

We have audited the accompanying
consolidated balance sheets of Cal-Maine Foods, Inc. and subsidiaries as of May 28,
2005 and May 29, 2004, and the related consolidated statements of operations,
stockholders equity, and cash flows for the three years ended May 28, 2005,
May 29, 2004, and May 31, 2003. Our audits also included the financial statement
schedule listed in the Index at Item 15(c). These financial statements are the
responsibility of the Companys management. Our responsibility is to express an
opinion on these financial statements based on our audits.

We conducted our audits in accordance
with the standards of the Public Company Accounting Oversight Board (United States). Those
standards require that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis for our
opinion.

In our opinion, the financial
statements referred to above present fairly, in all material respects, the consolidated
financial position of Cal-Maine Foods, Inc. at May 28, 2005 and May 29, 2004,
and the consolidated results of its operations and its cash flows for each of the years
ended May 28, 2005, May 29, 2004, and May 31, 2003, in conformity with U.S. generally
accepted accounting principles.

We also have audited, in accordance
with the standards of the Public Company Accounting Oversight Board (United States), the
effectiveness of Cal-Maine Foods Inc.s internal control over financial reporting as
of May 28, 2005, based on criteria established in Internal Control  Integrated
Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission
and our report dated August 5, 2005 expressed an unqualified opinion thereon.

| | /s/
Ernst & Young LLP
| | ---------------------

New Orleans, LouisianaAugust 5, 2005

29

---

Cal-Maine Foods, Inc.
and Subsidiaries  Consolidated Balance Sheets  (in thousands, except per share amounts)

|                                                          
|----------------------------------------------------------
|Assets                                                    
|Current assets:                                           
|Cash and cash equivalents                                 
|Investments                                               
|Receivables:                                              
|Trade receivables, less allowance for doubtful            
|accounts of $92 in 2005 and $90 in 2004                   
|Other                                                     
|                                                          
|                                                          
|Recoverable federal and state income taxes                
|Inventories                                               
|Prepaid expenses and other current assets                 
|                                                          
|Total current assets                                      
|Other assets:                                             
|Notes receivable and investments                          
|Goodwill                                                  
|Other                                                     
|                                                          
|                                                          
|Property, plant and equipment, less accumulated           
|depreciation                                              
|                                                          
|Total assets                                              
|                                                          
|Liabilities and stockholders' equity                      
|Current liabilities:                                      
|Trade accounts payable                                    
|Accrued wages and benefits                                
|Accrued expenses and other liabilities                    
|Current maturities of long-term debt                      
|Deferred income taxes                                     
|                                                          
|Total current liabilities                                 
|Long-term debt, less current maturities                   
|Other noncurrent liabilities                              
|Deferred income taxes                                     
|                                                          
|Total liabilities                                         
|Stockholders' equity:                                     
|Common stock, $.01 par value                              
|Authorized shares - 60,000 in 2005 and 2004               
|Issued and outstanding shares - 35,130 in 2005 and 2004   
|Class A common stock, $.01 par value                      
|Authorized shares - 2,400 in 2005 and 2004                
|Issued and outstanding shares - 2,400 in 2005 and 2004    
|Paid-in capital                                           
|Retained earnings                                         
|Common stock in treasury (14,043 shares in 2005 and 13,307
|shares in 2004)                                           
|                                                          
|Total stockholders' equity                                
|                                                          
|Total liabilities and stockholders' equity                
|                                                          

See accompanying
notes.

30

---

Cal-Maine Foods, Inc.
and Subsidiaries  Consolidated Statements of Operations  (in thousands, except per share
amounts)

|                                     
|-------------------------------------
|May 28
2005                          
|Net sales                            
|Cost of sales                        
|                                     
|Gross profit                         
|Selling, general and administrative  
|                                     
|Operating income (loss)              
|Other income (expense):              
|Interest expense                     
|Interest income                      
|Equity in income (loss) of affiliates
|Other, net                           
|                                     
|                                     
|                                     
|Income (loss) before income taxes    
|Income tax expense (benefit)         
|                                     
|Net income (loss)                    
|                                     
|Net income (loss) per share:         
|Basic                                
|                                     
|Diluted                              
|                                     
|Weighted average shares outstanding: 
|Basic                                
|                                     
|Diluted                              
|                                     

See accompanying
notes.

31

---

Cal-Maine Foods, Inc.
and Subsidiaries  Consolidated Statements of Stockholders Equity  (in thousands,
except per share amounts)

|                           | Common Stock | 
|-------------------------- | ------------ | 
|
|Balance at June 1, 2002    |              | 
|Cash dividends paid        |              | 
|($.05 per common share)    |              | 
|Net income for fiscal 2003 |              | 
|                           |              | 
|Balance at May 31, 2003    |              | 
|Two-for-one stock split    |              | 
|effected in the form of a  |              | 
|stock dividend             |              | 
|Cash dividends paid ($.05  |              | 
|per common share)          |              | 
|Issuance of common stock   |              | 
|from treasury              |              | 
|Net income for fiscal 2004 |              | 
|                           |              | 
|Balance at May 29, 2004    |              | 
|Purchase of treasury stock |              | 
|Cash dividends paid ($.05  |              | 
|per common share)          |              | 
|Issuance of common         |              | 
|stock from treasury        |              | 
|Net loss for fiscal 2005   |              | 
|                           |              | 
|Balance at May 28, 2005    |              | 
|                           |              | 

See accompanying
notes.

32

---

Cal-Maine Foods, Inc.
and Subsidiaries  Consolidated Statements of Cash Flows (in thousands)

|                                                 
|-------------------------------------------------
|May 28
2005                                      
|Cash flows from operating activities             
|Net income (loss)                                
|Adjustments to reconcile net income (loss)       
|to net cash provided by operating activities:    
|Depreciation and amortization                    
|Deferred income taxes                            
|Equity in (income) loss of affiliates            
|Gain on disposal of property, plant and          
|equipment                                        
|Change in operating assets and liabilities:      
|Receivables and other assets                     
|Inventories                                      
|Accounts payable, accrued expenses               
|and other liabilities                            
|                                                 
|Net cash provided by operating activities        
|Cash flows from investing activities             
|Purchases of investments                         
|Sales of investments                             
|Payments received on notes receivable and        
|from investments                                 
|Purchases of property, plant and equipment       
|Increase in notes receivable and investments     
|Net proceeds from disposal of property,          
|plant and equipment                              
|                                                 
|Net cash used in investing activities            
|Cash flows from financing activities             
|Net payments on note payable to bank             
|Long-term borrowings                             
|Principal payments on long-term debt             
|Proceeds from issuance of common stock from      
|treasury                                         
|Purchases of common stock for treasury           
|Payments of dividends                            
|                                                 
|Net cash used in financing activities            
|                                                 
|Increase in cash and cash equivalents            
|Cash and cash equivalents at beginning of year   
|                                                 
|Cash and cash equivalents at end of year         
|                                                 
|Non-cash investing activity - note receivable for
|sale of livestock                                
|                                                 

See accompanying notes.

33

---

# Cal-Maine Foods, Inc.
and Subsidiaries

Notes to Consolidated
Financial Statements  (in thousands, except share and per share amounts)  May 28, 2005

# 1. Significant
Accounting Policies

# Principles of
Consolidation

The consolidated financial statements
include the accounts of Cal-Maine Foods, Inc. and its subsidiaries (the
Company) all of which are wholly-owned. All significant intercompany
transactions and accounts have been eliminated in consolidation.

# Business

The Company is engaged in the
production, processing and distribution of shell eggs. The Companys operations are
significantly affected by the market price fluctuation of its principal products sold,
shell eggs, and the costs of its principal feed ingredients, corn and other grains.

Primarily all of the Companys
sales are to wholesale egg buyers in the southeastern, southwestern, mid-western and
mid-Atlantic regions of the United States. Credit is extended based upon an evaluation of
each customers financial condition and credit history and generally collateral is
not required. Credit losses have consistently been within managements expectations.
One customer accounted for 30.9%, 26.8% and 21.3% of the Companys net sales in
fiscal 2005, 2004 and 2003, respectively. Another customer accounted for 12.1%, 11.9% and
12.8% of the Companys net sales in fiscal 2005, 2004 and 2003, respectively.

# Use of Estimates

The preparation of the consolidated
financial statements in conformity with accounting principles generally accepted in the
United States requires management to make estimates and assumptions that affect the amount
reported in the consolidated financial statements and accompanying notes. Actual results
could differ from those estimates.

# Cash Equivalents

The Company considers all highly
liquid investments with a maturity of three months or less when purchased to be cash
equivalents.

# Investments

Investments include primarily
pre-funded municipal bonds and certificates of deposit with maturities of three to six
months when purchased. We have designated these investments as available-for-sale
securities and have accounted for them in accordance with the standards of Statement of
Financial Accounting Standards SFAS No.115, Accounting For Certain Investments: Debt
and Equity Securities. Due to the nature of the investments, the cost at May 28,
2005 and May 29, 2004 approximates fair value; therefore, accumulated other comprehensive
income (loss) has not been recognized as a separate component of stockholders
equity.

# Trade Receivables

Trade receivables are comprised
primarily of amounts owed to the Company from customers, which amounted to $16,044 at May
28, 2005 and $21,943 at May 29, 2004. Trade receivables are presented net of allowance for
doubtful accounts of $92 at May 28, 2005 and $90 at May 29, 2004.

34

---

# Allowance for Doubtful
Accounts

In the normal course of business, we
extend credit to our customers on a short-term basis. Although credit risks associated
with our customers are considered minimal, we routinely review our accounts receivable
balances and make provisions for probable doubtful accounts. In circumstances where
management is aware of a specific customers inability to meet its financial
obligations to us (e.g. bankruptcy filings), a specific reserve is recorded to reduce the
receivable to the amount expected to be collected. For all other customers, we recognize
reserves for bad debts based on the length of time the receivables are past due, generally
100% for amounts more than 60 days past due.

# Inventories

Inventories of eggs, feed, supplies
and livestock are valued principally at the lower of cost (first-in, first-out method) or
market.

The cost associated with flocks,
consisting principally of chick purchases, feed, labor, contractor payments and overhead
costs, are accumulated during a growing period of approximately 18 weeks. Flock costs are
amortized over the productive lives of the flocks, generally one to two years.

# Property, Plant and
Equipment

Property, plant and equipment are
stated at cost. Depreciation is provided by the straight-line method over the estimated
useful lives, which are 15 to 25 years for buildings and improvements and 3 to 12 years
for machinery and equipment. We expense repair and maintenance costs as incurred.

# Impairment of Long-Lived
Assets

The Company continually reevaluates
the carrying value of its long-lived assets for events or changes in circumstances which
indicate that the carrying value may not be recoverable. When triggering events or
circumstances indicate a fixed asset may be impaired, we perform an impairment analysis in
accordance with SFAS No. 144, Accounting for the Impairment Disposal of Long-Lived
Assets.

# Intangible Assets

Included in other assets are loan
acquisition costs which are amortized over the life of the related loan and franchise fees
which are amortized over ten years.

# Goodwill

Goodwill represents the excess of
cost of a business acquisition over the fair value of the net identifiable assets
acquired. Goodwill is reviewed for impairment annually or more frequently if impairment
indications arise.

# Revenue Recognition and
Delivery Costs

Revenue is recognized when product is
delivered and title has passed to customers.

Costs to deliver product to customers are
included in selling, general and administrative expenses in the accompanying consolidated
statements of operations and totaled $18,311, $18,172, and $18,234 in fiscal 2005, 2004
and 2003, respectively.

35

---

# Advertising Costs

The Company expenses advertising
costs as incurred. Total advertising costs were $821 in fiscal 2005, $564 in fiscal 2004,
and $471 in fiscal 2003.

# Income Taxes

Income taxes have been provided using
the liability method. Deferred income taxes reflect the net tax effects of temporary
differences between the carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for income tax purposes.

# Stock Based Compensation

The Company accounts for stock option
grants in accordance with APB Opinion No. 25, Accounting for Stock Issued to
Employees.

The following table illustrates the
effect on net income (loss) and earnings (loss) per share if the Company had applied the
fair value recognition provisions of Statement of Financial Accounting Standards (SFAS)
No. 123, Accounting for Stock-Based Compensation, which require compensation
cost for all stock-based employee compensation plans to be recognized based on the use of
a fair value method.

|                                            
|--------------------------------------------
|May 28
2005                                 
|Net income (loss)                           
|Add:  Stock-based employee compensation     
|expense income included in reported         
|net income (loss)                           
|Deduct:  Total stock-based employee         
|compensation (expense) income determined    
|under fair value based method for all awards
|                                            
|Pro forma net income (loss)                 
|                                            
|Net income (loss) per share:                
|Basic-- as reported                         
|                                            
|Basic-- pro forma                           
|                                            
|Diluted-- as reported                       
|                                            
|Diluted-- pro forma                         
|                                            

The fair value of our stock options
were estimated as of the date of the grant using a Black-Scholes option pricing model with
the following weighted average assumptions for the prior year grants: risk-free interest
rate of 3%; a dividend yield of 1%; expected volatility of 39.2%; and a weighted average
expected life of the options of 5 years.

# Net Income (Loss) per
Common Share

Basic earnings (loss) per share are
based on the weighted average common shares outstanding. Diluted earnings (loss) per share
include any dilutive effects of options and warrants.

36

---

# Stock Split

On April 14, 2004, the Shareholders
of the Company approved amendments to the Certificate of Incorporation to facilitate a
two-for-one stock split approved by the Board of Directors on January 26, 2004. The split
was effected in the form of a stock dividend paid on April 23, 2004 to stockholders of
record on April 14, 2004. All share and per share data in this report has been adjusted to
reflect this stock split.

# Reclassifications

Certain reclassifications were made
to the fiscal 2004 and 2003 financial statements to conform to the current year
presentation.

# Impact of Recently
Issued Accounting Standards

In November 2004, the FASB issued
Statement of Financial Accounting Standards (SFAS) No. 151, Inventory
Costs. SFAS No. 151 amends Accounting Research Bulletin (ARB) No. 43,
Chapter 4, to clarify that abnormal amounts of idle facility expense, freight, handling
costs and spoilage should be recognized as current-period charges. In addition, SFAS No.
151 requires that allocation of fixed production overhead to inventory be based on the
normal capacity of the production facilities. SFAS No. 151 is effective for inventory
costs incurred during fiscal years beginning after June 15, 2005. The Company is currently
assessing the impact that SFAS No. 151 will have on the results of operations, financial
position or cash flows.

In December 2004, the FASB issued
SFAS No. 123 (Revised 2004), Share-Based Payment (SFAS No.
123(R)), which replaces SFAS No. 123, Accounting for Stock-Based
Compensation, and supercedes APB No. 25, Accounting for Stock Issued to
Employees. SFAS 123(R) required companies to measure compensation costs for
share-based payments to employees, including stock options, at fair value and expense such
compensation over the service period beginning with the first annual period after December
15, 2005. The pro forma disclosures previously permitted under SFAS No. 123 will no longer
be an alternative to financial statement recognition. The Company expects to adopt SFAS
No. 123(R) in the first quarter of fiscal 2007. FAS No. 123(R) permits public companies to
adopt its requirement using either a modified prospective method or a modified
retrospective method. Under the modified prospective method, companies are required to
record compensation cost for new and modified awards over the related vesting period of
such awards prospectively and record compensation cost prospectively for the unvested
portion, at the date of adoption, of previously issued and outstanding awards over the
remaining vesting period of such awards. No change to prior periods presented is permitted
under the modified prospective method. Under the modified retrospective method, companies
record compensation costs for prior periods retroactively through restatement of such
periods using the proforma amounts previously disclosed in the footnotes. Also, in the
period of adoption and after, companies record compensation cost based on the modified
prospective method. We have not yet determined the method of adoption we will use, and we
cannot currently estimate the future effects of adopting this new guidance.

# Fiscal Year

The Companys fiscal year-end is
on the Saturday nearest May 31, which was May 28, 2005, May 29, 2004 and May 31,
2003, for the most recent three fiscal years.

# 2. Investment in
Affiliates

The Company owns 50% of Cumberland
Milling JV, Specialty Eggs LLC and Delta Egg Farm, LLC (Delta Egg) and 44% of
American Egg Products, Inc. at May 28, 2005. Investment in affiliates, recorded using the
equity method of accounting, totaled $8,502 and $9,948 at May 28, 2005 and at May 29,
2004, respectively. Equity in income or (loss) of ($88), $5,923 and $442 from these
entities have been included in the consolidated statements of operations for fiscal 2005,
2004 and 2003, respectively.

37

---

The Company is a guarantor of 50% of
Delta Eggs long-term debt, which totaled approximately $12 million at May 28, 2005.
Delta Eggs long-term debt is secured by substantially all fixed assets of Delta Egg
and is due in monthly installments through fiscal 2009. Delta Egg is engaged in the
production, processing and distribution of shell eggs. The other 50% owner also guarantees
50% of the debt. The guarantee arose when Delta Egg borrowed funds to construct its
production and processing facility in 1999. The guarantee would be required if Delta Egg
is not able to pay the debt. Management of the Company believes this possibility is
unlikely because Delta Egg is now well capitalized.

# 3. Inventories

Inventories consisted of the
following:

|                 
|-----------------
|Flocks           
|Eggs             
|Feed and supplies
|Livestock        
|                 
|                 
|                 

# 4. Property, Plant and
Equipment

Property, plant and equipment
consisted of the following:

|                             
|-----------------------------
|Land and improvements        
|Buildings and improvements   
|Machinery and equipment      
|Construction-in-progress     
|                             
|                             
|Less accumulated depreciation
|                             
|                             
|                             

Depreciation expense was $16,367,
$16,520 and $16,370 in fiscal 2005, 2004 and 2003, respectively.

38

---

# 5. Leases

Future minimum payments under
noncancelable operating leases that have initial or remaining noncancelable terms in
excess of one year at May 28, 2005 are as follows:

|2006                         |  |  | $ | 8,373  | 
|---------------------------- |  |  | - | ------ | 
|2007                         |  |  |   | 7,982  | 
|2008                         |  |  |   | 5,999  | 
|2009                         |  |  |   | 2,523  | 
|2010                         |  |  |   | 533    | 
|                             | 
|Total minimum lease payments |  |  | $ | 25,410 | 
|                             | 

Substantially all of the leases
provide that the Company pay taxes, maintenance, insurance and certain other operating
expenses applicable to the leased assets. The Company has guaranteed under certain
operating leases the residual value of transportation equipment at the expiration of the
leases. Rent expense was $8,109, $9,193 and $9,457 in fiscal 2005, 2004 and 2003,
respectively. Included in rent expense are vehicle rents totaling $1,318, $1,766 and
$2,336 in fiscal 2005, 2004 and 2003, respectively.

# 6. Credit Facilities and
Long-Term Debt

Long-term debt consisted of the
following:

|                                                    
|----------------------------------------------------
|Note payable at 6.7%; due in monthly installments   
|of $100, plus interest, maturing in 2009            
|Note payable at 8.26%; due in monthly installments  
|of $155, including interest, maturing in 2015       
|Series A Senior Secured Notes at 6.87%; due in      
|annual principal installments of $1,917 beginning in
|December 2002 through 2008 with interest due        
|semi-annually                                       
|Series B Senior Secured Notes at 7.18%; due in      
|annual principal installments of $2,143 beginning in
|December 2003 through 2009 with interest due        
|semi-annually                                       
|Industrial revenue bonds at 6.10%; due in           
|monthly installments of $146, including interest,   
|maturing in 2011                                    
|Note payable at 7.5%; due in monthly installments   
|of $36, including interest, maturing in 2011        
|Note payable at 7.06%; due in monthly installments  
|of $53, including interest, maturing in 2015        

39

---

|                                                    
|----------------------------------------------------
|Note payable at 6.87%; due in monthly installments  
|of $45, including interest, maturing in 2015        
|Note payable at 6.80%; due in monthly installments  
|of $165, plus interest, maturing in 2013            
|Note payable at 5.8%; due in annual principal       
|installments of $250 beginning in April 2006 through
|2015 with interest due quarterly                    
|                                                    
|                                                    
|Less current maturities                             
|                                                    
|                                                    
|                                                    

The aggregate annual fiscal year
maturities of long-term debt at May 28, 2005 are as follows:

|2006       |  |  | $ | 10,149 | 
|---------- |  |  | - | ------ | 
|2007       |  |  |   | 10,339 | 
|2008       |  |  |   | 10,543 | 
|2009       |  |  |   | 17,088 | 
|2010       |  |  |   | 5,737  | 
|Thereafter |  |  |   | 29,138 | 
|           | 
|           |  |  | $ | 82,994 | 
|           | 

The Company has a $35,000 line of
credit with three banks. The line of credit, which expires on December 31, 2006, is
limited in availability based upon accounts receivable and inventories. The Company had
$32.4 millionavailable to borrow under the line of credit at May 28, 2005.
Borrowings under the line of credit bear interest at 3% above the federal funds rate.
Facilities fees of 0.5% per annum are payable quarterly on the unused portion of the line.

Substantially all trade receivables
and inventories collateralize the line of credit and property, plant and equipment
collateralize the long-term debt. The Company is required, by certain provisions of the
loan agreements, to maintain minimum levels of working capital and net worth; to limit
dividends, capital expenditures and additional long-term borrowings; and to maintain
various current, debt-to-equity and interest coverage ratios. Additionally, the chief
executive officer of the Company, or his family, must maintain ownership of not less than
50% of the outstanding voting stock of the Company.

Interest of $5,860, $7,386 and $8,435
was paid during fiscal 2005, 2004 and 2003, respectively. Interest of $72 and $419 was
capitalized for construction of certain facilities during fiscal 2005 and 2003,
respectively. No interest was capitalized during fiscal 2004.

# 7. Employee Benefit Plans

The Company maintains a medical plan
that is qualified under Section 401(a) of the Internal Revenue Code and not subject to tax
under present income tax laws. Under its plan, the Company self-insures, in part, coverage
for substantially all full-time employees with coverage

40

---

by insurance carriers for certain
stop-loss provisions for losses greater than $150 for each occurrence. The Companys
expense, including accruals for incurred but not reported claims, were approximately
$7,065, $5,911 and $6,258 in fiscal 2005, 2004 and 2003, respectively.

The Company has a 401(k) plan which
covers substantially all employees. Participants in the Plan may contribute up to the
maximum allowed by Internal Revenue Service regulations. The Company does not make
contributions to the 401(k) plan.

The Company has an employee stock
ownership plan (ESOP) that covers substantially all employees. The Company makes
contributions to the ESOP of 3% of participants compensation, plus an additional
amount determined at the discretion of the Board of Directors. Contributions may be made
in cash or the Companys common stock. Company contributions to the ESOP vest
immediately. The Companys contributions to the plan were $1,643, $1,755 and $2,056
in fiscal 2005, 2004 and 2003, respectively.

The Company has deferred compensation
agreements with certain officers for payments to be made over specified periods beginning
when the officers reach age 65 or over as specified in the agreements. Amounts accrued for
these agreements are based upon deferred compensation earned over the estimated remaining
service period of each officer. Deferred compensation expense totaled approximately $72 in
fiscal 2005, $80 in fiscal 2004 and $50 in fiscal 2003.

# 8. Stock Option Plan

The Company has elected to follow APB
No. 25 and related Interpretations in accounting for its employee stock options. Pro forma
information regarding net income and net income per share is required by SFAS No. 123, and
has been determined as if the Company had accounted for its employee stock options under
the fair value method of that Statement. The fair value for these options was estimated at
the date of grant using a Black-Scholes option pricing model with the following
weighted-average assumptions for fiscal 2003: risk-free interest rate of 3%; dividend
yield of 1%; volatility factor of the expected market price of the Companys common
stock of 39.2%, and a weighted-average expected life of the options of 5 years. No options
were granted by the Company during fiscal 2005 and 2004. The weighted-average fair value
of options granted during fiscal 2003 was $0.72.

A summary of the Companys stock
option activity and related information is as follows:

|                           
|---------------------------
|Outstanding at June 1, 2002
|Granted                    
|Exercised                  
|                           
|Outstanding at May31, 2003 
|Exercised                  
|Forfeited                  
|                           
|Outstanding at May 29, 2004
|Exercised                  
|                           
|Outstanding at May 28, 2005
|                           

41

---

The Company has reserved 1,600,000
shares under its 1993 Stock Option Plan. The options have ten-year terms and vest annually
over five years beginning one year from the grant date. At May 28, 2005, no shares
were available for grant under the 1993 plan.

The Company has reserved 1,000,000
shares under its 1999 Stock Option Plan, all of which were granted to officers and key
employees in fiscal 2000. Each stock option granted under the 1999 Stock Option Plan was
accompanied by the grant of a Tandem Stock Appreciation Right (TSAR). The
options and TSARs have ten-year terms and vest annually over five years beginning one year
from the grant date. Upon exercise of a stock option, the related TSAR is also considered
to be exercised, and the holder will receive a cash payment from the Company equal to the
excess of the fair market value of the Companys common stock and the option exercise
price. Compensation expense (benefit) of $(1,277), $23,225 and $1,119 applicable to this
plan was recognized in fiscal 2005, 2004 and 2003, respectively.

The weighted average remaining
contractual life of the options outstanding was 5 years at May 28, 2005, 6 years at May
29, 2004, and 7 years at May 31, 2003. Of the total options outstanding, 39,600, 25,000
and 551,200 were exercisable at May 28, 2005, May 29, 2004, and May 31, 2003,
respectively.

# 9. Income Taxes

Income tax expense (benefit)
consisted of the following:

|           
|-----------
|May 28
2005
|Current:   
|Federal    
|State      
|           
|           
|Deferred:  
|Federal    
|State      
|           
|           
|           
|           
|           

42

---

Significant components of the
Companys deferred tax liabilities and assets were as follows:

|                                
|--------------------------------
|Deferred tax liabilities:       
|Property, plant and equipment   
|Cash basis temporary differences
|Inventories                     
|Investment in affiliates        
|Other                           
|                                
|Total deferred tax liabilities  
|Deferred tax assets:            
|Accrued expenses                
|Other                           
|                                
|Total deferred tax assets       
|                                
|Net deferred tax liabilities    
|                                

Effective May 29, 1988, the Company
could no longer use cash basis accounting for its farming subsidiary because of tax law
changes. TheTaxpayer Relief Act of 1997 provides that taxes on the cash basis
temporary differences as of that date are generally payable over 20 years beginning in
fiscal 1999 or in full in the first fiscal year in which there is a change in ownership
control. The Company uses the farm-price method for valuing inventories for income tax
purposes.

The differences between income tax
expense (benefit) at the Companys effective income tax rate and income tax expense
(benefit) at the statutory federal income tax rate were as follows:

|                                      
|--------------------------------------
|May 28
2005                           
|Statutory federal income tax (benefit)
|State income taxes (benefit), net     
|Other, net                            
|                                      
|                                      
|                                      

Federal and state income taxes of
$391, $41,868, and $1,610 were paid in fiscal 2005, 2004 and 2003, respectively. Federal
and state income taxes of $3,062, $6,875 and $1,377 were refunded in fiscal 2005, 2004 and
2003, respectively.

# 10. Other Matters

The carrying amounts in the
consolidated balance sheet for cash and cash equivalents, accounts receivable, notes
receivable and investments and accounts payable approximate their fair values. The fair
value of the Companys long-term debt is estimated to be $87,300. The fair values for
notes receivable and long-term debt are estimated using discounted cash flow analysis,
based on the Companys current incremental borrowing rates for similar arrangements.

43

---

The Companys interest expense
is sensitive to changes in the general level of U.S. interest rates. The Company maintains
certain of its debt as fixed rate in nature to mitigate the impact of fluctuations in
interest rates. Under its current policies, the Company does not use interest rate
derivative instruments to manage its exposure to interest rate changes. A one percent (1%)
adverse move (decrease) in interest rates would adversely affect the net fair value of the
Companys debt by $3,300 at May 28, 2005. The Company is a party to no other market
risk sensitive instruments requiring disclosure.

The Company is the defendant in
certain legal actions. It is the opinion of management, based on advice of legal counsel,
that the outcome of these actions will not have a material adverse effect on the
Companys consolidated financial position or operations.

In fiscal 2003, the Company
recognized $9,466 in vendor settlements pertaining to overcharges for vitamins purchased
by the Company over a number of years. The settlements are reflected in the accompanying
consolidated financial statements as a reduction of cost of sales.

# 11. Subsequent Event

The Company has entered into an
Agreement to Form a Limited Liability Company, Transfer Assets Thereto, and Purchase Units
of Membership Therein, dated July 28, 2005 (the Agreement), with Hillandale
Farms of Florida, Inc. and Hillandale Farms, Inc. (collectively, Hillandale
herein) and the shareholders of Hillandale, whereby the Company will acquire most of the
egg production and marketing operations of Hillandale. The parties to the Agreement will
form a new limited liability company, Hillandale, LLC, to which the assets, liabilities
and operations of Hillandale to be acquired will be transferred. The two Hillandale
companies will be the initial members of Hillandale, LLC for formational purposes. At the
closing of the acquisition, the Company will purchase 51% of the Units of Membership of
Hillandale, LLC from Hillandale at a presently estimated cost of approximately $30,000 to
$35,000, subject to adjustment upwards or downwards, based upon valuations agreed upon by
the parties to the Agreement. The remaining 49% of the Units of Membership of Hillandale,
LLC, are to be acquired in essentially equal annual installments over a four-year period,
with the purchase price of the units equal to their book value as calculated in accordance
with the terms of the Agreement. The acquisition will be made for cash, from the
Companys available funds, and borrowings to the extent necessary. When completed,
the acquisition is expected to increase the Companys current egg production capacity
by approximately 30%.

44

---

12.         Quarterly
Financial Data: (unaudited, amount in thousands, except per share           data):

|                            
|----------------------------
|First
Quarter               
|Net sales                   
|Gross profit                
|Net income (loss)           
|Net income (loss) per share:
|Basic                       
|Diluted                     
|                            
|Fiscal Year 2004            
|First
Quarter               
|Net sales                   
|Gross profit                
|Net income                  
|Net income per share:       
|Basic                       
|Diluted                     

# SCHEDULE II VALUATION
AND QUALIFYING ACCOUNTS  Years ended May 28, 2005, May 29, 2004, and May 31, 2003  (in
thousands)

|Description                     | Balance at
Beginning of
Period | Charged to
Cost and
Expense | Write-off
of
Accounts | Balance at
End of
Period
|------------------------------- | ------------------------------ | --------------------------- | --------------------- | ------------------------
|Year ended May 28, 2005:        |                                |                             |                       |                         
|Allowance for doubtful accounts |                                |                             | $                     | 90                      
|                                |                                |                             |                       |                         
|Year ended May 29, 2004:        |                                |                            
|Allowance for doubtful accounts |                                |                             | $                     | 1,158                   
|                                |                                |                             |                       |                         
|Year ended May 31, 2003:        |                                |                            
|Allowance for doubtful accounts |                                |                             | $                     | 175                     
|                                |                                |                             |                       |                         

45

---

# ITEM 9. CHANGES IN AND
DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

# ITEM 9A. CONTROLS AND
PROCEDURES

# Disclosure Controls and
Procedures

Our
disclosure controls and procedures are designed to provide reasonable assurance that
information required to be disclosed by it in its periodic reports filed with the
Securities and Exchange Commission is recorded, processed, summarized and reported, within
the time periods specified in the Commissions rules and forms. Based on an
evaluation of our disclosure controls and procedures conducted by our Chief Executive
Officer and Chief Financial Officer, together with other financial officers, such officers
concluded that our disclosure controls and procedures were effective as of May 28, 2005.

# Internal Control Over
Financial Reporting

| | (a) | Management's
Report on Internal Control Over Financial Reporting
| | --- | ----------------------------------------------------------------

In accordance with Section 404(a) of
the Sarbanes-Oxley Act of 2002 and Item 308(a) of the Commissions Regulation S-K,
the report of management on our internal control over financial reporting is set forth in
this Annual Report on Form 10-K under Item 8. Financial Statements and Supplementary Data.

| | (b) | Attestation
Report of the Registrant's Public Accounting Firm
| | --- | -------------------------------------------------------------

The attestation report of Ernst &
Young LLP on managements assessment of our internal control over financial reporting
is set forth in this Annual Report on Form 10-K under Item 8. Financial Statements and
Supplementary Data.

| | (c) | Changes
in Internal Control Over Financial Reporting
| | --- | ----------------------------------------------------

In accordance with Rule 13a-15(c)
under the Securities Exchange Act of 1934, management, with the participation of our Chief
Executive Officer and Chief Financial Officer, together with other financial officers,
evaluated the effectiveness, as of May 28, 2005, of our internal control over financial
reporting. Management determined that there was no change in our internal control over
financial reporting that occurred during the fourth quarter ended May 28, 2005, that has
materially affected, or is reasonably likely to materially affect, our internal control
over financial reporting.

# ITEM 9B OTHER INFORMATION

Not applicable

46

---

# PART III

# ITEM 10. DIRECTORS AND
EXECUTIVE OFFICERS OF THE REGISTRANT

The
information concerning directors and executive officers is incorporated by reference from
our definitive proxy statement which is to be filed pursuant to Regulation 14A under the
Securities Exchange Act of 1934 in connection with our 2005 Annual Meeting of
Shareholders.

# ITEM 11. EXECUTIVE
COMPENSATION

The
information concerning executive compensation is incorporated by reference from our
definitive proxy statement which is to be filed pursuant to Regulation 14A under the
Securities Exchange Act of 1934 in connection with our 2005 Annual Meeting of
Shareholders.

# ITEM 12. SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The
information concerning security ownership of certain beneficial owners and management and
related stockholder matters is incorporated by reference from our definitive proxy
statement which is to be filed pursuant to Regulation 14A under the Securities Exchange
Act of 1934 in connection with our 2005 Annual Meeting of Shareholders.

# ITEM 13. CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS

The
information concerning certain relationships and related transactions is incorporated by
reference from our definitive proxy statement which is to be filed pursuant to Regulation
14A under the Securities Exchange Act of 1934 in connection with our 2005 Annual Meeting
of Shareholders.

# ITEM 14. PRINCIPAL
ACCOUNTANT FEES AND SERVICES

The
information concerning principal accounting fees and services is incorporated by reference
from our definitive proxy statement which is to be filed pursuant to Regulation 14A under
the Securities Exchange Act of 1934 in connection with our 2005 Annual Meeting of
Shareholders.

47

---

# PART IV

# ITEM 15. EXHIBITS AND
FINANCIAL STATEMENT SCHEDULES

| | (a)(1) | Financial
Statements
| | ------ | --------------------

The following financial statements
are filed herewith:

The following consolidated financial
statements of Cal-Maine Foods, Inc. and subsidiaries are included in Item 8:

Report of Independent Registered
Public Accounting Firm

Consolidated Balance Sheets  May
28, 2005 and May 29, 2004.

Consolidated Statements of
Operations  Years Ended May 28, 2005, May 29, 2004 and May 31, 2003.

Consolidated Statements of Changes
in Shareholders Equity for the Years Ended May 28, 2005, May 29, 2004 and May 31,
2003.

Consolidated Statements of Cash
Flows for the Years Ended May 28, 2005, May 29, 2004 and May 31, 2003.

Notes to Consolidated Financial
Statements.

| | (a)(2) | Financial
Statement Schedule
| | ------ | ----------------------------

Schedule II  Valuation and
Qualifying Accounts

All other schedules are omitted
either because they are not applicable or required, or because the required information
is included in the financial statements or notes thereto.

| | (a)(3) | Exhibits
Required by Item 601 of Regulation S-K
| | ------ | -----------------------------------------------

See Part (b) of this Item 15.

| | (b) | Exhibits
Required by Item 601 of Regulation S-K
| | --- | -----------------------------------------------

| | The
following exhibits are filed herewith or incorporated by reference:
| | -----------------------------------------------------------------------

|ExhibitNumber | Exhibit
|------------- | -------

|2.1 | Agreement
to Form a Limited Liability Company, Transfer Assets Thereto, and Purchase Units of
Membership              Therein, dated July 28, 2005, by and among Hillandale Farms of
Florida, Inc., Hillandale Farms, Inc., Cal-Maine  Foods, Inc. and Jack E. Hazen, Jack E.
Hazen, Jr., Homer E. Honeycutt, Jr., Orland R. Bethel and Dorman W.   Mizell. **********
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

48

---

|3.1 | Amended
and Restated Certificate of Incorporation of the Registrant.*
|--- | ---------------------------------------------------------------------

|3.1(a) | Amendment
to Article 4 of the Certificate of Incorporation of the           Registrant.*********
|------ | ------------------------------------------------------------------------------------------------

|3.2 | By-Laws
of the Registrant, as amended.*
|--- | ---------------------------------------

|4.1 | See
Exhibits 3.1 and 3.2 as to the rights of holders of the Registrant's common stock.
|--- | --------------------------------------------------------------------------------------

|10.1 | Amended
and Restated Term Loan Agreement, dated as of May 29, 1990, between Cal-Maine Foods, Inc.
and Cooperative Centrale          Raiffeisen - Boerenleenbank B.A., "Rabobank Nederland,"
New York Branch, and Amended and Restated Revolving Credit Agreement          among
Cal-Maine Foods, Inc., and Barclays Banks PLD (New York) and Cooperatieve Centrale
Raiffeisen-Borenleenbank B.A.,  dated as of 29 May 1990, and amendments thereto (without
exhibits).*
|---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.1(a) | Amendment
to Term Loan Agreement (see Exhibit 10.1) dated as of June 3, 1997           (without
exhibits). **
|------- | -------------------------------------------------------------------------------------------------------------

|10.1(b) | Amendment
to Term Loan Agreement (see Exhibit 10.1) dated as of March 31, 2004           (without
exhibits).*********
|------- | ---------------------------------------------------------------------------------------------------------------------

|10.1(c) | Amendment
to Term Loan Agreement (see Exhibit 10.1) dated as of April 14, 2004           (without
exhibits).*********
|------- | ---------------------------------------------------------------------------------------------------------------------

|10.1(d) | Amendment
to Term Loan Agreement (see Exhibit 10.1) dated as of August 6,2004 (without
exhibits).
|------- | -------------------------------------------------------------------------------------------------

|10.1(e) | Amendment
to Term Loan Agreement (see Exhibit 10.1) dated as of March 15,2005 (without
exhibits).
|------- | -------------------------------------------------------------------------------------------------

|10.2 | Note
Purchase Agreement, dated as of November 10, 1993, between John Hancock Mutual Life
Insurance Company and Cal-Maine Foods, Inc., and amendments thereto (without exhibits).*
|---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.3 | Loan
Agreement, dated as of May 1, 1991, between Metropolitan Life Insurance Corporation and
Cal-Maine Foods, Inc., and          amendments thereto (without exhibits).*
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.4 | Employee
Stock Ownership Plan, as Amended and Restated.* +
|---- | ----------------------------------------------------------

|10.5 | 1993
Stock Option Plan, as Amended.*+
|---- | -------------------------------------

|10.6 | Wage
Continuation Plan, dated as of January1, 1986, among R.K. Looper, B.J. Raines, and the
Registrant.* +
|---- | ----------------------------------------------------------------------------------------------------------

|10.6(a) | Amendment
dated October 29, 1997 to Wage Continuation Plan, dated as of January                1,
1986, between B.J. Raines and the Registrant. ****+
|------- | -----------------------------------------------------------------------------------------------------------------------------------------------------

|10.7 | Wage
Continuation Plan, dated as of July 1, 1986, between Jack Self and the Registrant, as
amended on September 2, 1994.* +
|---- | ---------------------------------------------------------------------------------------------------------------------------

|10.8 | Wage
Continuation Plan, dated as of April 15, 1988, between Joe Wyatt and the Registrant.* +
|---- | --------------------------------------------------------------------------------------------

|10.9 | Redemption
Agreement, dated March 7, 1994, between the Registrant and Fred R. Adams, Jr.*
|---- | -----------------------------------------------------------------------------------------

|10.10 | Note
Purchase Agreement, dated December 18, 1997, among Cal-Maine Foods, Inc., Cal-Maine
Farms, Inc.,             Cal-Maine Egg Products, Inc., Cal-Maine Partnership, LTD, CMF of
Kansas LLC and First South Production             Credit Association and Metropolitan
Life Insurance Company (without exhibits, except names of guarantors and
            forms of notes) ***
|----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.11 | Wage
Continuation Plan, dated as of January 14, 1999, among Stephen Storm, Charles F. Collins,
Bob Scott, and the          Registrant  *****+
|----- | ---------------------------------------------------------------------------------------------------------------------------------------------

49

---

|10.12 | Secured
note purchase agreement dated September 28, 1999 among Cal-Maine Foods, Inc., Cal-Maine
Partnership, LTD, and John Hancock Mutual Life Insurance Company, and John Hancock
Variable Life Insurance Company (without exhibits, annexes and disclosure schedules)
******
|----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10.13 | 1999
Stock Option Plan ********+
|----- | --------------------------------

|21 | Subsidiaries
of the Registrant
|-- | ------------------------------

|23 | Consent
of Independent Auditors
|-- | -------------------------------

|31.1 | Certification
of Chief Executive Officer
|---- | ----------------------------------------

|31.2 | Certification
of Chief Financial Officer
|---- | ----------------------------------------

|32 | Written
Statement of the Chief Executive Officer and the Chief Financial Officer
|-- | --------------------------------------------------------------------------------

---

|+ | Management
contract or compensatory plan.
|- | -----------------------------------------

|* | Incorporated
by reference to the same exhibit number in Registrant's Form S-1 Registration Statement
No. 333-14809.
|- | -------------------------------------------------------------------------------------------------------------------

|** | Incorporated
by reference to the same exhibit number in Registrants Form 10-K for fiscal year
ended May 31, 1997.
|-- | ------------------------------------------------------------------------------------------------------------------

|*** | Incorporated
by reference to the same exhibit number in Registrants Form 10-Q for the quarter
ended November 29, 1997.
|--- | -----------------------------------------------------------------------------------------------------------------------

|**** | Incorporated
by reference to the same exhibit number in Registrants Form 10-K for fiscal year
ended May 30, 1998.
|---- | ------------------------------------------------------------------------------------------------------------------

|***** | Incorporated
by reference to the same exhibit number in Registrants Form 10-K for fiscal year
ended May 29, 1999.
|----- | ------------------------------------------------------------------------------------------------------------------

|****** | Incorporated
by reference to the same exhibit number in Registrants Form 10-Q for the quarter
ended November 27, 1999.
|------ | -----------------------------------------------------------------------------------------------------------------------

|******* | Incorporated
by reference to the same exhibit number in Registrants Form 8-K, dated September
30, 1999.
|------- | --------------------------------------------------------------------------------------------------------

|******** | Incorporated
by reference to Registrant's Form S-8 Registration Statement No. 333-39940, dated June
23, 2000.
|-------- | -------------------------------------------------------------------------------------------------------------

|********* | Incorporated
by reference to the same exhibit number in Registrants Form 10-K for fiscal year
ended May 29, 2004.
|--------- | ------------------------------------------------------------------------------------------------------------------

|********** | Incorporated
by reference to the same exhibit number in Registrants Form 8-K, dated July 28,
2005.
|---------- | ---------------------------------------------------------------------------------------------------

The Company agrees to file with the
Securities and Exchange Commission, upon request, copies of any instrument defining the
rights of the holders of its consolidated long-term debt.

| | (c) | Financial
Statement Schedules Required by Regulation S-X
| | --- | --------------------------------------------------------

The financial statement schedule
required by Regulation S-X is filed at page 45. All other schedules for which provision
is made in the applicable accounting regulations of the Securities and Exchange
Commission are not required under the related instructions or are inapplicable and
therefore have been omitted.

50

---

# SIGNATURES

Pursuant to the requirements of
Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused
this report to be signed on its behalf by the undersigned, thereunto duly authorized, in
Jackson, Mississippi, on this 10thday of August, 2005.

CAL-MAINE FOODS, INC.

/s/ Fred R. Adams, Jr.
                                                       Fred R. Adams, Jr.                 Chairman of
the Board and                 Chief Executive Officer

Pursuant to the requirements of the
Securities Exchange Act of 1934, this report has been signed below by the following
persons on behalf of the registrant and in the capacities and on the dates indicated:

|Signature              | Title                                 | Date           
|---------------------- | ------------------------------------- | ---------------
|/s/ Fred R. Adams, Jr  | Chairman of the Board and             | August 10, 2005
|Fred R. Adams, Jr      | Chief Executive Officer              
|                       | (Principal Executive Officer)        
|/s/ Richard K. Looper  | Vice Chairman of the Board            | August 10, 2005
|Richard K. Looper      | and Director                         
|/s/ Adolphus B. Baker  | President and Director                | August 10, 2005
|Adolphus B. Baker     
|/s/ Bobby J. Raines    | Vice President, Treasurer             | August 10, 2005
|Bobby J. Raines        | and Director                         
|/s/ Timothy A. Dawson  | Vice President, Chief Financial       | August 10, 2005
|Timothy A. Dawson      | Officer (Principal Financial Officer)
|/s/ Charles F. Collins | Vice President, Controller            | August 10, 2005
|Charles F. Collins     | (Principal Accounting Officer)       
|/s/ Letitia C. Hughes  | Director                              | August 10, 2005
|Letitia C. Hughes     
|/s/ R. Faser Triplett  | Director                              | August 10, 2005
|R. Faser Triplett     
|/s/ James E. Poole     | Director                              | August 10, 2005
|James E. Poole        

51

---

CAL-MAINE FOODS, INC. Form
10-K for the fiscal year  Ended May 28, 2005  EXHIBIT INDEX

|ExhibitNumber | Exhibit
|------------- | -------

|10.1(d) | Amendment
to Term Loan Agreement dated as of August 6, 2004 (without exhibits).
|------- | -------------------------------------------------------------------------------

|10.1(e) | Amendment
to Term Loan Agreement dated as of March 15, 2005 (without exhibits).
|------- | -------------------------------------------------------------------------------

|21 | Subsidiaries
of Cal-Maine Foods, Inc
|-- | ------------------------------------

|23 | Consent
of Independent Auditors
|-- | -------------------------------

|31.1 | Certification
of The Chief Executive Officer
|---- | --------------------------------------------

|31.2 | Certification
of The Chief Financial Officer
|---- | --------------------------------------------

|32 | Written
Statement of The Chief Executive Officer and Chief Financial Officer
|-- | ----------------------------------------------------------------------------

52