Oil-Dri Corporation of America (ticker: ODC, exchange: New York Stock Exchange (.N))
News Release -
8-Dec-2011
Oil-Dri Announces First Quarter ResultsCHICAGO, IL, Dec 08, 2011 (MARKETWIRE via COMTEX) -- Oil-Dri Corporation of America (NYSE: ODC) today announced net
sales of $59,582,000 for the first quarter ended October 31, 2011, a
6% increase compared with net sales of $56,285,000 in the same
quarter one year ago. Net income for the first quarter was
$1,075,000, or $0.15 per diluted share, a 57% decrease compared with
net income of $2,519,000, or $0.35 per diluted share, for the same
quarter one year ago.
First Quarter Business Review
President and Chief Executive Officer
Daniel S. Jaffee said, "This quarter's results reflect increased net
sales of higher margin products combined with significant promotional
spending to support our newly introduced Cat's Pride Fresh & Light
cat litter.
"Business to Business products showed significant sales and income
growth which helped to defray advertising and promotional costs for
Cat's Pride Fresh & Light. During the quarter advertising and
promotional expenses were nearly $3,000,000 more than those same
expenditures one year ago. We are pleased with the initial positive
retailer and consumer response to our new litter and expect
distribution to grow for this product throughout the balance of the
fiscal year."
First Quarter Segment Review
Business to Business First Quarter
--------------------------------
Fiscal 2012 Fiscal 2011
--------------- ---------------
Net Sales $ 20,934,000 $ 19,045,000
--------------- ---------------
Segment Income $ 7,440,000 $ 5,288,000
--------------- ---------------
Net sales for the Company's Business to Business products were up 10%
from one year ago driven by a higher average net selling price which
offset the Group's volume decrease. Group income was up 41% in the
quarter due to increased product sales. Net sales of fluids
purification and animal health products increased, agricultural
carriers were flat, and co-packaged cat litters were down. The Group
benefited from net sales and volume growth of fluids purification
products sold to vegetable oil and petroleum refineries, and
increased sales and volume of animal health products for livestock
production. Sales of co-packaged cat litters declined as the market
for cat litter continues to shift from traditional coarse litter to
scoopable litter.
Retail and Wholesale First Quarter
-------------------------------
Fiscal 2012 Fiscal 2011
-------------- ---------------
Net Sales $ 38,648,000 $ 37,240,000
-------------- ---------------
Segment Income $ (1,219,000) $ 3,066,000
-------------- ---------------
Net sales for the Company's Retail and Wholesale products for the
first quarter were up 4% due to the launch of Cat's Pride Fresh &
Light and the benefit of increased sales of Cat's Pride scoopable
litters. These sales more than overcame the decline in coarse cat
litter and private label accounts. Group income was down due to heavy
advertisement and promotional spending for Cat's Pride Fresh & Light
cat litters. Industrial floor absorbents and sports field products
realized increased net sales in the quarter. The Company's foreign
subsidiaries sales were down significantly due to strong competition.
Financial Review
On October 18, 2011, Oil-Dri's Board of Directors
declared quarterly cash dividends of $0.17 per share of outstanding
Common Stock and $0.1275 per share of outstanding Class B Stock. The
dividends were payable December 2, 2011 to stockholders of record at
the close of business on November 18, 2011. The Company has paid cash
dividends continuously since 1974 and has increased dividends
annually for the past eight years.
At the end of the first quarter, the annualized dividend yield on the
Company's Common Stock was 3.4%, based on the quarter's stock closing
price of $20.05 per share and the latest cash quarterly dividend of
$0.17.
Cash, cash equivalents and short-term investments at October 31,
2011, totaled $29,390,000. Capital expenditures for the first quarter
totaled $1,611,000, which was $734,000 less than the quarter's
depreciation and amortization of $2,345,000.
Looking Forward
Jaffee continued, "We are focused on building brand
awareness of Cat's Pride Fresh & Light by optimizing our promotional
activity for our target audience and closely monitoring these
expenses. Our sales team is energized by the positive response we
have received from our retail partners.
"While increased distribution is expected in the remaining fiscal
quarters, we expect the introduction of Cat's Pride Fresh & Light to
negatively impact consolidated earnings compared with those reported
in fiscal 2011."
The Company will offer a live webcast of the first quarter earnings
teleconference on Friday, December 9, 2011 from 10:00 a.m. to 10:30
a.m., Chicago Time. To listen to the call via the web, please visit
www.streetevents.com or www.oildri.com. An archived recording of the
call and written transcripts of all teleconferences are posted on the
Oil-Dri website.
Cat's Pride is a registered trademark of Oil-Dri Corporation of
America. Fresh & Light is a trademark of Oil-Dri Corporation of
America.
Oil-Dri Corporation of America is a leading supplier of specialty
sorbent products for agricultural, horticultural, fluids
purification, specialty markets, industrial and automotive, and is
the world's largest manufacturer of cat litter.
Certain statements in this press release may contain forward-looking
statements that are based on our current expectations, estimates,
forecasts and projections about our future performance, our business,
our beliefs, and our management's assumptions. In addition, we, or
others on our behalf, may make forward-looking statements in other
press releases or written statements, or in our communications and
discussions with investors and analysts in the normal course of
business through meetings, webcasts, phone calls, and conference
calls. Words such as "expect," "outlook," "forecast," "would",
"could," "should," "project," "intend," "plan," "continue,"
"believe," "seek," "estimate," "anticipate," "believe", "may,"
"assume," variations of such words and similar expressions are
intended to identify such forward-looking statements, which are made
pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995.
Such statements are subject to certain risks, uncertainties and
assumptions that could cause actual results to differ materially
including, but not limited to, the dependence of our future growth
and financial performance on successful new product introductions,
intense competition in our markets, volatility of our quarterly
results, risks associated with acquisitions, our dependence on a
limited number of customers for a large portion of our net sales and
other risks, uncertainties and assumptions that are described in Item
1A (Risk Factors) of our most recent Annual Report on Form 10-K and
other reports we file with the Securities and Exchange Commission.
Should one or more of these or other risks or uncertainties
materialize, or should underlying assumptions prove incorrect, our
actual results may vary materially from those anticipated, intended,
expected, believed, estimated, projected or planned. You are
cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date of this press release.
Except to the extent required by law, we do not have any intention or
obligation to update publicly any forward-looking statements after
the distribution of this press release, whether as a result of new
information, future events, changes in assumptions, or otherwise.
O I L - D R I C O R P O R A T I O N O F A M E R I C A
Consolidated Statements of Income
(in thousands, except for per share amounts)
(unaudited)
Three Months Ended October 31,
------------------------------------------
% of % of
2011 Sales 2010 Sales
--------- --------- --------- ---------
Net Sales $ 59,582 100.0% $ 56,285 100.0%
Cost of Sales (45,379) 76.2% (43,077) 76.5%
--------- --------- --------- ---------
Gross Profit 14,203 23.8% 13,208 23.5%
Operating Expenses (12,407) 20.8% (9,386) 16.7%
--------- --------- --------- ---------
Operating Income 1,796 3.0% 3,822 6.8%
Interest Expense (524) 0.9% (411) 0.7%
Other Income 201 0.3% 69 0.1%
--------- --------- --------- ---------
Income Before Income Taxes 1,473 2.5% 3,480 6.2%
Income Taxes (398) 0.7% (961) 1.7%
--------- --------- --------- ---------
Net Income $ 1,075 1.8% $ 2,519 4.5%
========= ========= ========= =========
Net Income Per Share:
Basic Common $ 0.16 $ 0.38
Basic Class B Common $ 0.12 $ 0.30
Diluted $ 0.15 $ 0.35
Average Shares Outstanding:
Basic Common 5,114 5,086
Basic Class B Common 1,920 1,897
Diluted 7,100 7,123
O I L - D R I C O R P O R A T I O N O F A M E R I C A
Consolidated Balance Sheets
(in thousands, except for per share amounts)
(unaudited)
As of October 31,
---------------------
2011 2010
---------- ----------
Current Assets
Cash and Cash Equivalents $ 21,000 $ 16,099
Investment in Short-term Securities 8,390 3,854
Accounts Receivable, net 31,294 28,037
Inventories 22,263 17,296
Prepaid Expenses 8,932 8,761
---------- ----------
Total Current Assets 91,879 74,047
---------- ----------
Property, Plant and Equipment 67,285 62,091
Other Assets 13,354 15,205
---------- ----------
Total Assets $ 172,518 $ 151,343
========== ==========
Current Liabilities
Current Maturities of Notes Payable $ 3,800 $ 4,100
Accounts Payable 6,621 6,424
Dividends Payable 1,132 1,061
Accrued Expenses 15,921 13,936
---------- ----------
Total Current Liabilities 27,474 25,521
---------- ----------
Long-Term Liabilities
Notes Payable 27,400 12,700
Other Noncurrent Liabilities 22,264 20,971
---------- ----------
Total Long-Term Liabilities 49,664 33,671
---------- ----------
Stockholders' Equity 95,380 92,151
---------- ----------
Total Liabilities and Stockholders' Equity $ 172,518 $ 151,343
========== ==========
Book Value Per Share Outstanding $ 13.56 $ 13.20
Acquisitions of
Property, Plant and Equipment
First Quarter $ 1,611 $ 1,638
Depreciation and Amortization Charges
First Quarter $ 2,345 $ 2,054
O I L - D R I C O R P O R A T I O N O F A M E R I C A
Consolidated Statements of Cash Flows
(in thousands)
(unaudited)
For the Three
Months Ended
October 31,
-------------------
CASH FLOWS FROM OPERATING ACTIVITIES 2011 2010
--------- ---------
Net Income $ 1,075 $ 2,519
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation and Amortization 2,345 2,054
(Increase) in Accounts Receivable (2,102) (897)
(Increase) in Inventories (3,033) (1,273)
Increase in Accounts Payable 449 55
Increase (Decrease) in Accrued Expenses 539 (2,830)
Other 1,104 (92)
--------- ---------
Total Adjustments (698) (2,983)
--------- ---------
Net Cash Provided by (Used in) Operating Activities 377 (464)
--------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES
Capital Expenditures (1,611) (1,638)
Net Dispositions of Investment Securities 7,435 2,001
Other 10 110
--------- ---------
Net Cash Provided by Investing Activities 5,834 473
--------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES
Principal Payments on Long-Term Debt (2,100) (1,500)
Dividends Paid (1,130) (1,043)
Purchase of Treasury Stock -- (511)
Other 7 420
--------- ---------
Net Cash (Used in) Financing Activities (3,223) (2,634)
--------- ---------
Effect of exchange rate changes on cash and cash
equivalents 127 (38)
Net Increase (Decrease) in Cash and Cash Equivalents 3,115 (2,663)
Cash and Cash Equivalents, Beginning of Year 17,885 18,762
--------- ---------
Cash and Cash Equivalents, October 31 $ 21,000 $ 16,099
========= =========
SOURCE: Oil-Dri Corporation of America
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Oil-Dri Corporation of America
