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Marketwire  06/06/2014 4:04 PM ET
Oil-Dri Announces Third Quarter and Nine-Month Results of Fiscal 2014

CHICAGO, IL -- (Marketwired) -- 06/06/14 -- Oil-Dri Corporation of America (NYSE: ODC) today announced net sales of $67,417,000 for the third quarter of fiscal 2014 ended April 30, 2014, a 5% increase compared with net sales of $64,152,000 in the same quarter one year ago. Net income for the third quarter was $722,000, or $0.10 per diluted share, down 78% from net income of $3,251,000, or $0.46 per diluted share, in the third quarter of fiscal 2013.

Net sales for the nine-month period ended April 30, 2014 were $200,268,000, a 7% increase compared with net sales of $186,691,000 in the same period one year ago. Net income for the nine-month period was $7,890,000, or $1.11 per diluted share, down 21% from net income of $9,849,000, or $1.40 per diluted share, in the same period of fiscal 2013.

BUSINESS REVIEW

President and Chief Executive Officer Daniel S. Jaffee said, "The quarterly results reflect continued cost pressures, planned advertising and promotional support for our Retail and Wholesale products and weakness in the sales and profitability of certain Business to Business products.

"Quarterly earnings were negatively impacted by increased packaging, freight and manufacturing costs, which included mining, hauling, a 25% increase in natural gas and additional labor needed for the packaging of private label products obtained through the acquisition of certain assets of MFM Industries, Inc. (the "MFM acquisition").

"As previously disclosed, we implemented a robust marketing plan in support of Cat's Pride Fresh & Light and our other scoopable litters during the quarter. Our investment was in multiple touch point advertising and included print and digital advertising and feature in-store displays. We are optimistic about the velocity of our products as unit shipments of Fresh & Light products increased 28% and overall scoopable litter shipments increased 19% in the quarter. This increase significantly outpaced the overall category growth of 6% during the period, as reported by a third party market research company.

"While the quarterly results reflect a long-term investment in our Retail & Wholesale products, the performance of our Business to Business products did not meet our expectations. Sales and income were affected by a reduction in the sales of Agsorb as a carrier for Corn Rootworm insecticides and lower sales of our animal health products."

SEGMENT REVIEW

Third Quarter Results

---------------------------------------------------------------------------- Business to Business Three Month Period Change Products February 1 - April 30 ---------------------------------------------------------------------------- Fiscal 2014 Fiscal 2013 Net Sales $22,470,000 $24,525,000 -8% Segment Income $5,336,000 $7,957,000 -33% ----------------------------------------------------------------------------

Sales were up for Pure-Flo B80 bleaching clay used in palm oil processing and for MD-09, our new feed additive used to reduce wet droppings in poultry production. Sales were down 38% for our agricultural products and 11% for our animal health products. Co-packaged traditional coarse cat litter sales were also down slightly compared to the third quarter of the prior year.

Selling, general and administrative expenses increased 23% compared to the third quarter of fiscal 2013. These expenses included the startup costs for our new subsidiary in China, Amlan Trading (Shenzhen) Company, Ltd. Segment income was also negatively impacted by the reduction in sales and increased packaging, materials and freight costs.

Nine-Month Results

 

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