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Oil-Dri Corporation of America Q1 2015 sales up 4%

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Staff writer ▼ | December 8, 2014
Oil-Dri Corporation of America announced net sales of $66,044,000 for the first quarter 2015 ended October 31, 2014, a 4% increase compared with net sales of $63,546,000 in the same quarter one year ago.
Better result   Net sales of $66,044,000 for Oil-Dri
Net income for the first quarter was $2,120,000 or $0.30 per diluted share, down from $2,887,000 or $0.41 per diluted share in the first quarter of fiscal 2014.

There were 7% fewer tons sold of Business to Business products in the period, resulting in a slight decrease of net sales. Sales of fluids purification products and co-packaged traditional coarse cat litter sales were down. Declines were partially offset by higher average selling prices and improved sales of agricultural products.

Reduced sales and increased costs for packaging materials and freight negatively impacted segment income. Selling, general and administrative expenses increased in the period primarily because of our new subsidiary in China, Amlan Trading (Shenzhen) company, Ltd.

In the Retail and Wholesale segment, overall cat litter volume increased 18%, resulting in improved net sales. The acquisition of MFM costumers increased private label cat litter sales approximately 50%. Sales of industrial absorbents and sports turf products also increased in the period. Sales of our Canadian and United Kingdom subsidiaries declined in the quarter.

Product mix and higher resin costs for packaging materials caused segment income to decline in the period. A decrease in advertising expense reduced selling, general and administrative expenses in the quarter.

Cash, cash equivalents, restricted cash and short-term investments at October 31, 2014, totaled $10,407,000 compared to $32,963,000 a year ago. Significant uses of cash in the past twelve months included the purchase of MFM assets, capital expenditures, regularly scheduled debt payments and quarterly dividends.

Capital expenditures for the three months ended October 31, 2014 totaled $5,717,000, which was $2,797,000 more than depreciation and amortization of $2,920,000. By comparison, capital expenditures totaled $3,382,000 in the first three months of fiscal 2014. Capital expenditures were primarily made for business growth projects and equipment replacement at our manufacturing facilities. Cash provided by operating activities was $1,748,000 for the period compared to cash used in operating activities of $652,000 for the same period of fiscal 2014.

On October 16, 2014, Oil-Dri's Board of Directors declared quarterly cash dividends of $0.20 per share of outstanding Common Stock and $0.15 per share of outstanding Class B Stock. The dividends were paid on November 28, 2014 to stockholders of record at the close of business on November 14, 2014.

The company has paid cash dividends continuously since 1974 and has increased dividends annually for the past eleven years. At the end of the first quarter, the annualized dividend yield on the company's Common Stock was 2.7%, based on the quarter's closing stock price of $30.18 per share and the latest quarterly cash dividend of $0.20.