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OilDri Corp. of America Reports Operating Results (10-Q)

June 08, 2010 | About:

10qk

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OilDri Corp. of America (ODC) filed Quarterly Report for the period ended 2010-04-30.

Oildri Corp. Of America has a market cap of $103 million; its shares were traded at around $19.79 with a P/E ratio of 15.3 and P/S ratio of 0.4. The dividend yield of Oildri Corp. Of America stocks is 3%.ODC is in the portfolios of Jim Simons of Renaissance Technologies LLC, Chuck Royce of Royce& Associates.

Highlight of Business Operations:

Consolidated net sales for the nine months ended April 30, 2010 were $164,397,000, a decrease of 9% from net sales of $180,311,000 in the first nine months of fiscal 2009. Net income for the first nine months of fiscal 2010 was $7,042,000, a slight increase from net income of $7,034,000 in the first nine months of fiscal 2009. Diluted net income per share for the first nine months of fiscal 2010 was $0.96 compared to $0.97 for the first nine months of fiscal 2009.

Net sales of the Business to Business Products Group for the first nine months of fiscal 2010 were $57,577,000, a decrease of $1,264,000, or 2%, from net sales of $58,841,000 in the first nine months of fiscal 2009. The decrease resulted primarily from a 4% decrease in tons sold for the Group; however, increased sales of higher priced products partially offset the decline in tons sold. Our co-packaged traditional coarse cat litter net sales decreased 14% with 4% fewer tons sold in the first nine months of fiscal 2010 compared to the first nine months of fiscal 2009. Net sales for the first nine months of fiscal 2010 were adversely affected by a lower net selling price; however, the net selling price increased in April 2010 under the terms of the agreement with our co-packaging partner. In addition, both the loss of a small co-packaging customer during the latter part of fiscal 2009 and a decline in the coarse cat litter market contributed to the decreased net sales and tons sold. Net sales of agricultural chemical carriers decreased 22% and tons sold decreased 20% compared to the first nine months of 2009 due primarily to the continued downturn in the agricultural chemical carriers market. Net sales of our flowability aid product were down 18% compared to the first nine months of 2009. Price competition and low levels of protein in the soybean crop, which inhibited the use of flowability aids in animal feed, drove the lower sales. Net sales of bleaching earth and fluid purification products increased 16% in the first nine months of fiscal 2010 due to 17% more tons sold. Sales in export markets improved as lower freight costs and a weaker U.S. dollar relative to certain foreign currencies during the first nine months of fiscal 2010 compared to the same period in the prior fiscal year made our products more competitive in the global marketplace. Some export markets also experienced a decline in the quality of soybean oil that resulted in increased demand for our bleaching earth products. In addition, sales of our fluid purification products used in the biodiesel industry and in palm oil processing increased compared to the first nine months of fiscal 2009. Net sales of animal health and nutrition products increased 1% in the first nine months of fiscal 2010. Increased sales of our enterosorbent products, which were introduced during fiscal 2009, were partially offset by a decline in net sales of our traditional animal health and nutrition products. Baseball-related sports products net sales increased 11% compared to the first nine months of fiscal 2009 due to customer purchases earlier in the baseball season and sales incentives.

Total assets increased $4,278,000, or 3%, during the first nine months of fiscal 2010. Current assets increased $2,675,000, or 4%, from fiscal 2009 year end balances due primarily to increased cash and cash equivalents. This increase was partially offset by decreases in investment in securities, accounts receivable, inventories and prepaid repairs expense. The changes in current assets are described below in Liquidity and Capital Resources. Property, plant and equipment, net of accumulated depreciation, increased $2,380,000 during the first nine months of fiscal 2010 due to additions in excess of depreciation expense. Additions were primarily for land, mineral rights, replacement of machinery and other capital projects at our manufacturing facilities. During the first nine months of fiscal 2010, we acquired land and mineral rights for approximately $3,000,000 near our Georgia production plant. Other noncurrent assets decreased $777,000 from fiscal 2009 year end balances due to payments received on a lease receivable related to a co-packaging agreement, lower deferred income taxes and amortization of certain other assets.

Consolidated net sales for the three months ended April 30, 2010 were $56,259,000, a decrease of 3% from net sales of $58,053,000 in the third quarter of fiscal 2009. Net income for the third quarter fiscal 2010 was $2,586,000, an increase of 7% from net income of $2,416,000 in the third quarter of fiscal 2009. Diluted net income per share for the third quarter of fiscal 2010 was $0.35 compared to $0.33 for the third quarter of fiscal 2009.

Cash used in investing activities was $3,593,000 in the first nine months of fiscal 2010 compared to cash provided by investing activities of $4,375,000 in the first nine months of fiscal 2009. Cash used for capital expenditures of $7,945,000 in the first nine months of fiscal 2010 included approximately $3,000,000 to purchase land and mineral rights near our Georgia production plant. Capital expenditures of $12,682,000 in the same period of fiscal 2009 included approximately $7,000,000 for capital projects related to new product development at our manufacturing facilities and land purchases. In the first nine months of fiscal 2010, net cash provided by dispositions of investment securities was $4,007,000 compared to $17,035,000 in the first nine months of fiscal 2009. In the first nine months of fiscal 2009, more cash was needed to fund capital expenditures and payments on long-term debt compared to the first nine months of fiscal 2010. Purchases and dispositions of investment securities in both periods are subject to variations in the timing of investment maturities. In addition, in the first nine months of fiscal 2010 we received $337,000 from the sale of land and buildings at our United Kingdom subsidiary.

Cash used in financing activities was $6,599,000 in the first nine months of fiscal 2010 compared to $8,740,000 in the first nine months of fiscal 2009. Cash used for payment of long-term debt in the first nine months of fiscal 2010 was $2,380,000 less than in the first nine months of fiscal 2009. In addition, cash provided by issuance of Common Stock in connection with stock option exercises was $827,000 higher in the first nine months of fiscal 2010. Conversely, $1,372,000 more cash was used to repurchase Common Stock in the first nine months of fiscal 2010 compared to the same period in fiscal 2009. Also, cash used for dividend payments was $235,000 higher in the first nine months of fiscal 2010 due to a dividend increase.

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10qk
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