The demand for eggs has been on the rise. As a result, egg production in the U.S. reached 6.59 billion dozen eggs in 2013, an increase a 1.1% annualized increase from the 2010 level. While it may not be as high growth as other industries egg manufacturers operate in a stable, arguably necissary, and growing industry. A prime example of a key player in this staple industry is egg producer Cal-Maine Foods (NASDAQ:CALM) which posted a blockbuster quarter recently. Its numbers came in way ahead of the Street's estimates, which sent its stock price to an all-time high. Let's take a look at what happened during the quarter and what the company has in store for future. 

Key drivers of the quarter
Cal-Maine Foods' revenue for the quarter surged 10% over the year-ago quarter to $395.5 million. Not only did higher prices play an important role in this, an increase in egg demand during the holiday season also helped the company's sales grow. The average price for eggs stood at $1.416 per dozen, an increase of 4.8% over the price last year. Also, the number of eggs sold surged 4.6% to 268.9 million dozen eggs.  

One of the key drivers for Cal-Maine's growth was a 9% jump in demand for organic eggs. Organic eggs, which make up 17% of the company's revenue, are resonating well with customers. Since people are becoming increasingly health-conscious and retailers have benefited by providing organic products.

Egg sales also increased because many food players have added new items to their breakfast menus, many of which include eggs.

Food companies such as Kellogg (NYSE:K) have been trying to use innovation in breakfast items as tools to attract customers and boost sales. Since people look for healthy breakfast options, Kellogg has introduced new items such as breakfast sandwiches and smoothies. Also, Kellogg has started to offer yogurts which have become quite popular with customers.

Breakfast has indeed become a highly competitive space in which many food companies have been coming up with new products. Kellogg's peer General Mills too plans to introduce 50 new products this year, which will include items such as breakfast tortillas. One of the reasons why Kellogg remains focused on such products is because the demand for cereals has been declining, which has hampered the company's sales.

Along with the benefits of rising demand for eggs, Cal-Maine Foods enjoyed the advantage of lower feed costs. The feed cost declined by $0.09 per dozen to $0.46 per dozen eggs. Hence, the company could not only increase its top line, it could also boost its bottom line. Its earnings jumped a whopping 39% over the year-ago quarter to $1.77 per share. Moreover, its gross margin also expanded to 23.2% from 18.6% in the year-ago quarter.

Cal-Maine's strengths
Cal-Maine Foods has always used acquisitions as a tool to expand and grow its business. After its acquisitions of egg assets from Pilgrim's Pride Corporation and the egg producer Maxim Production, the company acquired the remaining 50% stake in Delta Egg Farm. Cal-Maine completed the buyout last month and this will expand the egg producer's reach further.

Many other companies have resorted to similar strategies. For instance, Tyson Foods (NYSE:TSN) also uses an acquisition strategy in order to grow. It acquired Circle Foods and Don Julio Foods last year and these purchases have improved its performance. Tyson Foods' revenue surged to $8.76 billion in its last quarter, an increase of 4.7% over the year-ago quarter. Also, its earnings jumped a whopping 47% from the year-ago quarter to $0.72 per share. The volume of the company's prepared foods segment has risen 3.5% over that of last year since both of the buyouts contributed to its growth. Hence, Cal-Maine should also perform well in the future.

Apart from the acquisition, Cal-Maine should enjoy the benefits of growing demand for organic eggs. Since they are becoming increasingly popular and Cal-Maine is one of the leading producers of these eggs, the company definitely has an advantageous position.

Final thoughts
Although rising demand for eggs has played a crucial role in its performance, Cal-Maine Foods' growth strategy has been quite fruitful. Recent acquisitions have helped the company boost its top line. Moreover, Delta Egg Farm will further add to its revenue. Higher demand for organic eggs should also prove beneficial for the company. Hence, this company looks attractive enough for an investment.

Pratik Thacker has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.