UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of
1934
|
Date
of Report (Date of earliest event
reported) March
7, 2008
|
|
Oil-Dri
Corporation of America
|
|
(Exact
name of registrant as specified in its
charter)
|
|
Delaware
|
0-8675
|
36-2048898
|
||
|
(State
or other jurisdiction of
incorporation) |
(Commission
File
Number) |
(IRS
Employer
Identification
No.)
|
|
410
North Michigan Avenue
Suite
400
Chicago,
Illinois
|
60611-4213
|
|
(Address
of principal executive offices)
|
(Zip
Code)
|
|
Registrant’s
telephone number, including area
code (312)
321-1515
|
|
(Former
name or former address, if changed since last
report.)
|
Check
the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction A.2. below):
o
Written communications
pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o
Soliciting material pursuant to Rule
14a-12 under the Exchange Act (17 CFR 240.14a-12)
o
Pre-commencement communications pursuant
to Rule 14d-2(b) under the Exchange Act (17
CFR 240.14d-2(b))
o
Pre-commencement communications pursuant
to Rule 13e-4(c) under the Exchange Act (17
CFR 240.13e-4(c))
Item
2.02
Results of Operations and Financial Condition.
On
March
7, 2008, Oil-Dri Corporation of America (the “Registrant”) issued a press
release announcing its results of operations for its second quarter and first
half ended January 31, 2008. A copy of the press release is attached as Exhibit
99.1 and the information contained therein is incorporated herein by reference.
The information contained in this Item 2.02, including Exhibit 99.1, shall
not
be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of
1934 (the “Exchange Act”), and it shall not be deemed incorporated by reference
into any filing under the Exchange Act or the Securities Act of 1933, except
as
shall be expressly set forth by specific reference in such filing.
Item
9.01
Financial Statements and Exhibits.
(d)
Exhibits
|
Exhibit
Number
|
Description
of Exhibits
|
|
|
99.1
|
Press
Release of the Registrant dated March 7,
2008
|
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the Registrant
has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
|
OIL-DRI
CORPORATION OF AMERICA
|
|||
|
By:
|
/s/
Charles P. Brissman
|
||
|
Charles
P. Brissman
|
|||
|
Vice
President and General Counsel
|
|||
Date:
March 7, 2008
Exhibit
Index
|
Exhibit
Number
|
Description
of Exhibits
|
|
|
99.1
|
Press
Release of the Registrant dated March 7,
2008
|
Exhibit
99.1
 |
News
Release
|
|
Release:
Immediate
|
Contact: Ronda
J. Williams
|
|
312-706-3232
|
Oil-Dri
Announces Record Second Quarter Net Sales
and
Increased Earnings
CHICAGO –
(March 7, 2008) – Oil-Dri Corporation of America (NYSE: ODC) today
announced record net sales of $58,026,000 for its second fiscal quarter ended
January 31, 2008, a 10% increase compared with net sales of $52,873,000 in
the
same quarter one year ago. The Company reported net income for the quarter
of
$2,089,000, or $0.29 per diluted share, a 4% increase compared with net income
of $1,963,000, or $0.28 per diluted share, in the same quarter one year
ago.
Net
sales
for the six-month period were $113,311,000, an 8% increase compared with sales
of $105,002,000 in the same period one year ago. Net income for the six-month
period was $4,573,000, or $0.64 per diluted share, a 23% increase compared
with
net income of $3,610,000, or $0.52 per diluted share, in the same period last
fiscal year.
On
November 1, 2007, the Company completed the sale of emission reduction credits
to an unaffiliated party in the State of California. The Company received net
proceeds of $507,000, which were recorded as a reduction of cost of sales.
The
sale of these emission reduction credits added $0.05 per diluted share to
reported earnings in the quarter.
-
continued
-
Second
Quarter Review
President
and Chief Executive Officer Daniel S. Jaffee said, “This quarter we experienced
overall sales and volume growth. Private label cat litter, bleaching clay
adsorbents and animal health and nutrition products drove the business in the
second quarter; however, we experienced significantly higher material and
freight costs which contributed to a reduction in our gross profit margin from
22.5% in the first quarter to 19.6% in the second quarter. We are disappointed
that the price increases we have been executing have fallen short of the cost
increases we have incurred. We will certainly strive to repair our margins
during the back half of this fiscal year.”
Business
Review
Net
sales
for the Company’s Retail
and Wholesale Products Group
were
$39,463,000 and group income was $3,883,000 in the second quarter. Net sales
for
the six-month period were $77,831,000 and group income was $8,233,000. Net
sales
and volume growth were primarily driven by private label cat litter products.
The Group also realized increased sales of Oil-Dri industrial products in the
United Kingdom. Significant increases in freight costs, however,
negatively impacted gross profit for the Group in the quarter.
Net
sales
for the Company’s Business-to-Business
Products Group
were
$18,563,000 and group income was $3,656,000 in the second quarter. Net sales
for
the six-month period were $35,480,000 and group income was $7,657,000. Net
sales
and
volume growth were driven by sales of our bleaching clays and animal health
and
nutrition products. The Group also realized net sales and volume increases
in
its co-packaged cat litter business. Higher freight and materials costs
negatively affected gross profit for the Group in the
quarter.
-
continued
-
Financial
Review
On
December 4, 2007, Oil-Dri’s Board of Directors declared quarterly cash dividends
of $0.13 per share of outstanding Common Stock and $0.0975 per share of
outstanding Class B Stock. The dividends will be payable on March 7, 2008 to
stockholders of record at the close of business on February 22, 2008. At the
January 31, 2008 closing price of $20.05 per share and assuming cash dividends
continue at the same rate, the annual yield on the Company’s Common Stock is
2.6%.
Cash
and
cash equivalents totaled $4,325,000 and short-term investments totaled
$24,355,000 at January 31, 2008. Capital expenditures for the six-month period
totaled $3,828,000, which was $93,000 more than the depreciation and
amortization of $3,735,000.
Looking
Forward
Jaffee
said, “We are focused on new business growth and implementing price increases in
the second half of the fiscal year to cover our rising costs of goods. We have
been vigilant in monitoring our costs and identifying ways in which we can
profitably manage our business. We are very aware of the volatile energy
environment and are proactively taking steps to manage unforeseen variances
to
our production, materials and freight costs.”
###
The
Company will offer a live webcast of the second quarter earnings teleconference
on Monday, March 10, 2008, at 10AM CT. 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.
Trademark
Notice: Oil-Dri is a registered trademark of Oil-Dri Corporation of America
or
of its subsidiaries.
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,” or 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.
Consolidated
Statements of Income
(in
thousands, except for per share amounts)
(unaudited)
|
Second
Quarter Ended January 31,
|
|||||||||||||
|
2008
|
% of Sales
|
2007
|
% of Sales
|
||||||||||
|
Net
Sales
|
$
|
58,026
|
100.0
|
%
|
$
|
52,873
|
100.0
|
%
|
|||||
|
Cost
of Sales
|
(46,678
|
)
|
80.4
|
%
|
(41,376
|
)
|
78.3
|
%
|
|||||
|
Gross
Profit
|
11,348
|
19.6
|
%
|
11,497
|
21.7
|
%
|
|||||||
|
Operating
Expenses
|
(8,251
|
)
|
14.2
|
%
|
(8,651
|
)
|
16.4
|
%
|
|||||
|
Operating
Income
|
3,097
|
5.3
|
%
|
2,846
|
5.4
|
%
|
|||||||
|
Interest
Expense
|
(570
|
)
|
1.0
|
%
|
(641
|
)
|
1.2
|
%
|
|||||
|
Other
Income
|
355
|
0.6
|
%
|
475
|
0.9
|
%
|
|||||||
|
Income
Before Income Taxes
|
2,882
|
5.0
|
%
|
2,680
|
5.1
|
%
|
|||||||
|
Income
Taxes
|
(793
|
)
|
1.4
|
%
|
(717
|
)
|
1.4
|
%
|
|||||
|
Net
Income
|
$
|
2,089
|
3.6
|
%
|
$
|
1,963
|
3.7
|
%
|
|||||
|
Net
Income Per Share:
|
|||||||||||||
|
Basic
Common
|
$
|
0.32
|
$
|
0.32
|
|||||||||
|
Basic
Class B Common
|
$
|
0.26
|
$
|
0.23
|
|||||||||
|
Diluted
|
$
|
0.29
|
$
|
0.28
|
|||||||||
|
Average
Shares Outstanding:
|
|||||||||||||
|
Basic
Common
|
5,062
|
4,871
|
|||||||||||
|
Basic
Class B Common
|
1,853
|
1,815
|
|||||||||||
|
Diluted
|
7,239
|
6,987
|
|||||||||||
|
Six
Months Ended January 31,
|
|||||||||||||
|
2008
|
% of Sales
|
2007
|
% of Sales
|
||||||||||
|
Net
Sales
|
$
|
113,311
|
100.0
|
%
|
$
|
105,002
|
100.0
|
%
|
|||||
|
Cost
of Sales
|
(89,533
|
)
|
79.0
|
%
|
(82,842
|
)
|
78.9
|
%
|
|||||
|
Gross
Profit
|
23,778
|
21.0
|
%
|
22,160
|
21.1
|
%
|
|||||||
|
Operating
Expenses
|
(17,111
|
)
|
15.1
|
%
|
(16,812
|
)
|
16.0
|
%
|
|||||
|
Operating
Income
|
6,667
|
5.9
|
%
|
5,348
|
5.1
|
%
|
|||||||
|
Interest
Expense
|
(1,144
|
)
|
1.0
|
%
|
(1,258
|
)
|
1.2
|
%
|
|||||
|
Other
Income
|
785
|
0.7
|
%
|
838
|
0.8
|
%
|
|||||||
|
Income
Before Income Taxes
|
6,308
|
5.6
|
%
|
4,928
|
4.7
|
%
|
|||||||
|
Income
Taxes
|
(1,735
|
)
|
1.5
|
%
|
(1,318
|
)
|
1.3
|
%
|
|||||
|
Net
Income
|
$
|
4,573
|
4.0
|
%
|
$
|
3,610
|
3.4
|
%
|
|||||
|
Net
Income Per Share:
|
|||||||||||||
|
Basic
Common
|
$
|
0.70
|
$
|
0.58
|
|||||||||
|
Basic
Class B Common
|
$
|
0.57
|
$
|
0.43
|
|||||||||
|
Diluted
|
$
|
0.64
|
$
|
0.52
|
|||||||||
|
Average
Shares Outstanding:
|
|||||||||||||
|
Basic
Common
|
5,033
|
4,861
|
|||||||||||
|
Basic
Class B Common
|
1,846
|
1,810
|
|||||||||||
|
Diluted
|
7,196
|
6,952
|
|||||||||||
Consolidated
Balance Sheet
(in
thousands, except for per share amounts)
(unaudited)
|
As of January 31,
|
|||||||
|
2008
|
2007
|
||||||
|
Current
Assets
|
|||||||
|
Cash
and Cash Equivalents
|
$
|
4,325
|
$
|
9,572
|
|||
|
Investment
in Treasury Securities
|
24,355
|
18,846
|
|||||
|
Accounts
Receivable, net
|
29,973
|
26,920
|
|||||
|
Inventories
|
16,396
|
14,429
|
|||||
|
Prepaid
Expenses
|
6,299
|
6,840
|
|||||
|
Total
Current Assets
|
81,348
|
76,607
|
|||||
|
Property,
Plant and Equipment
|
51,732
|
51,313
|
|||||
|
Other
Assets
|
12,281
|
12,615
|
|||||
|
Total
Assets
|
$
|
145,361
|
$
|
140,535
|
|||
|
Current
Liabilities
|
|||||||
|
Current
Maturities of Notes Payable
|
$
|
8,080
|
$
|
4,080
|
|||
|
Accounts
Payable
|
6,130
|
6,184
|
|||||
|
Dividends
Payable
|
846
|
758
|
|||||
|
Accrued
Expenses
|
14,366
|
14,588
|
|||||
|
Total
Current Liabilities
|
29,422
|
25,610
|
|||||
|
Long-Term
Liabilities
|
|||||||
|
Notes
Payable
|
23,000
|
31,080
|
|||||
|
Other
Noncurrent Liabilities
|
8,001
|
8,610
|
|||||
|
Total
Long-Term Liabilities
|
31,001
|
39,690
|
|||||
|
Stockholders'
Equity
|
84,938
|
75,235
|
|||||
|
Total
Liabilities and Stockholders' Equity
|
$
|
145,361
|
$
|
140,535
|
|||
|
Book
Value Per Share Outstanding
|
$
|
12.35
|
$
|
11.28
|
|||
|
Acquisitions
of Property, Plant and Equipment Second
Quarter
|
$
|
1,681
|
$
|
1,746
|
|||
|
Year
to Date
|
$
|
3,828
|
$
|
4,098
|
|||
|
Depreciation
and Amortization Charges Second
Quarter
|
$
|
1,873
|
$
|
1,848
|
|||
|
Year
to Date
|
$
|
3,735
|
$
|
3,672
|
|||
Consolidated
Statements of Cash Flows
(in
thousands)
(unaudited)
|
For
the Six Months Ended
|
|||||||
|
January
31,
|
|||||||
|
|
2008
|
2007
|
|||||
|
CASH
FLOWS FROM OPERATING ACTIVITIES
|
|||||||
|
Net
Income
|
$
|
4,573
|
$
|
3,610
|
|||
|
Adjustments
to reconcile net income to net cash provided
by operating activities:
|
|||||||
|
Depreciation
and Amortization
|
3,735
|
3,672
|
|||||
|
(Increase)
in Accounts Receivable
|
(2,159
|
)
|
(1,010
|
)
|
|||
|
(Increase)
Decrease in Inventories
|
(1,159
|
)
|
1,268
|
||||
|
Increase
(Decrease) in Accounts Payable
|
144
|
(968
|
)
|
||||
|
(Decrease)
in Accrued Expenses
|
(1,893
|
)
|
(95
|
)
|
|||
|
Other
|
(519
|
)
|
636
|
||||
|
Total
Adjustments
|
(1,851
|
)
|
3,503
|
||||
|
Net
Cash Provided by Operating Activities
|
2,722
|
7,113
|
|||||
|
CASH
FLOWS FROM INVESTING ACTIVITIES
|
|||||||
|
Capital
Expenditures
|
(3,828
|
)
|
(4,098
|
)
|
|||
|
Net
(Purchases) Dispositions of Investment Securities
|
(6,006
|
)
|
848
|
||||
|
Other
|
28
|
30
|
|||||
|
Net
Cash Used in Investing Activities
|
(9,806
|
)
|
(3,220
|
)
|
|||
|
CASH
FLOWS FROM FINANCING ACTIVITIES
|
|||||||
|
Principal
payments on Long-Term Debt
|
(80
|
)
|
(80
|
)
|
|||
|
Dividends
Paid
|
(1,678
|
)
|
(1,509
|
)
|
|||
|
Other
|
1,199
|
618
|
|||||
|
Net
Cash Used in Financing Activities
|
(559
|
)
|
(971
|
)
|
|||
|
Effect
of exchange rate changes on cash and cash
equivalents
|
(165
|
)
|
43
|
||||
|
Net
(Decrease) Increase in Cash and Cash Equivalents
|
(7,808
|
)
|
2,965
|
||||
|
Cash
and Cash Equivalents, Beginning of Year
|
12,133
|
6,607
|
|||||
|
Cash
and Cash Equivalents, January 31
|
$
|
4,325
|
$
|
9,572
|
|||