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) October
10, 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):
¨
Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
¨
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
¨
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act
(17
CFR
240.14d-2(b))
¨
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
October 10, 2008, Oil-Dri Corporation of America (the “Registrant”) issued a
press release announcing its results of operations for its fourth quarter and
fiscal year ended July 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 October 10,
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:
October 10, 2008
Exhibit
Index
|
Number
|
Description
of Exhibits
|
|
|
99.1
|
Press
Release of the Registrant dated October 10,
2008
|
Exhibit
99.1
News
Release
|
Release:
Immediate
|
Contact:
|
Ronda J. Williams
|
|
312-706-3232
|
Oil-Dri
Announces Record Sales and Record Earning Per Share for the
Fiscal
Year ended July 31, 2008
CHICAGO –
(OCTOBER 10, 2008) – Oil-Dri Corporation of America (NYSE: ODC) today
announced that the combination of increased unit shipments and higher per unit
selling prices contributed to record sales and increased earnings for both
the
fourth quarter and the fiscal year ended July 31, 2008.
The
Company reported net sales for the fiscal year of $232,359,000, a 10% increase
compared with net sales of $212,117,000 for the previous fiscal year. Net income
for the fiscal year was $9,039,000, or $1.25 per diluted share, a 15% increase
compared with net income of $7,660,000, or $1.09 per diluted share, for fiscal
2007. The $1.25 earnings per diluted share for fiscal 2008 eclipsed the previous
high mark of $1.13, adjusted for stock splits.
Net
sales
for the quarter were $59,505,000, a 10% increase compared with sales of
$54,159,000 in the same quarter one year ago. The Company reported net income
for the quarter of $2,453,000, or $0.34 per diluted share, a 17% increase
compared with net income of $2,051,000, or $0.29 per diluted share, in the
same
quarter one year ago.
During
the second and fourth quarters of the fiscal year, the Company sold California
emission reduction credits to an unaffiliated third party. The sales of these
credits totaled $831,000 for the fiscal year and were reported as a reduction
to
the cost of sales.
Fourth
Quarter and Fiscal Year Review
President
and Chief Executive Officer Daniel S. Jaffee said, “We had a very good year of
net sales and earnings growth. We gained new business and expanded product
distribution in both reporting segments. While our energy costs to process
and
transport our products continued to increase throughout the year, we were able
to partially recover profit margins lost through price increases and better
manufacturing efficiency.
The
following chart shows key metrics that illustrate our continued growth over
the
past five years. We are encouraged by our progress and believe that our approach
to achieving long-term sales and profitability growth and cash generation is
reflected in the figures shown below. In particular, we are pleased by our
ability to invest in our company while continually increasing value for our
stockholders.”
|
Key
Metrics
|
F’08
|
F’07
|
F’06
|
F’05
|
F’04
|
|||||||||||
|
Cash,
cash equivalents & investments
|
$
|
27,764,000
|
$
|
30,027,000
|
$
|
25,855,000
|
$
|
19,435,000
|
$
|
23,069,000
|
||||||
|
Notes
payable minus cash and equivalents (debt net of cash)
|
$ |
(684,000
|
)
|
$
|
1,133,000
|
$
|
9,385,000
|
$
|
3,885,000
|
$
|
4,331,000
|
|||||
|
Return
on average stockholders’ equity
|
10.8
|
%
|
10.0
|
%
|
7.2
|
%
|
9.0
|
%
|
7.1
|
%
|
||||||
|
*Net
income per diluted share
|
$
|
1.25
|
$
|
1.09
|
$
|
0.73
|
$
|
0.88
|
$
|
0.68
|
||||||
|
Research
and development expenses
|
$
|
2,497,000
|
$
|
2,154,000
|
$
|
1,809,000
|
$
|
2,429,000
|
$
|
2,453,000
|
||||||
|
Capital
expenditures
|
$
|
7,302,000
|
$
|
7,757,000
|
$
|
10,827,000
|
$
|
7,311,000
|
$
|
6,067,000
|
||||||
|
Dividends
paid
|
$
|
3,377,000
|
$
|
3,038,000
|
$
|
2,403,000
|
$
|
2,206,000
|
$
|
1,998,000
|
||||||
|
Dividends
paid per Common Stock share
|
$
|
0.52
|
$
|
0.48
|
$
|
0.38
|
$
|
0.34
|
$
|
0.31
|
||||||
*Net
income per diluted share reflects the five-for-four stock split effected on
September 8, 2006.
Business
Review
Net
sales
for the Company’s Retail
and Wholesale Products Group
were
$40,260,000 and group income was $3,557,000 in the fourth quarter. Net sales
for
the fiscal year were $157,311,000 and group income was $14,973,000. Net sales
in
the quarter and the fiscal year increased as a result of strategic pricing
and
new business in private label cat litter. Additionally industrial and automotive
business increased in the fourth quarter from new customers acquired through
a
small asset acquisition. Gross margins for the Group, however, were negatively
impacted by higher transportation, packaging and materials costs.
Net
sales
for the Company’s Business-to-Business
Products Group
were
$19,245,000, and group income was $4,221,000 in the fourth quarter. Net sales
for the fiscal year were $75,048,000, and group income was $15,782,000. Net
sales in the quarter and fiscal year increased as a result of new business
and
pricing strategy. Throughout the year, the Group experienced net sales and
volume growth primarily in bleaching clay and animal health and nutrition
products; however, the Group experienced sales and volume declines in
agricultural carriers and sports turf products. Increased manufacturing
processing costs and transportation negatively impacted the Group’s gross
margins.
Financial
Review
On
June
10, 2008, Oil-Dri’s Board of Directors declared quarterly cash dividends of
$0.14 per share of outstanding Common Stock and $0.105 per share of outstanding
Class B stock. The dividends were payable on September 5, 2008 to stockholders
of record at the close of business on August 22, 2008. At the July 31, 2008
stock closing price of $17.22 per share and assuming cash dividends continue
at
the same rate, the annual yield on the Company’s Common Stock is 3.3%.
The
Company has paid cash dividends continuously since 1974. The Company’s Board of
Directors has increased dividends annually for the past five years.
Cash,
cash equivalents and short-term investments at July 31, 2008, totaled
$27,764,000. Capital expenditures for the fiscal year totaled $7,302,000, which
was $153,000 less than the fiscal year’s depreciation and amortization of
$7,455,000.
Looking
Forward
Jaffee
said, “We have invested a great deal of resources in strengthening our core
business and advancing new product development. While we will continue to take
a
long-term approach to our business, we will become more aggressive in
introducing new products and building our infrastructure to support growth
in
the coming fiscal year. Our short-term focus will be on repairing our gross
margins which have been negatively impacted by the rising cost of
fuel.”
###
The
Company will offer a live webcast of the fourth quarter earnings teleconference
on Monday, October 13, 2008, at 10am CDT. 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.
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.
Consolidated
Statements of Income
(in
thousands, except for per share amounts)
(unaudited)
|
Fourth
Quarter Ended July 31,
|
|||||||||||||
|
2008
|
%
of Sales
|
2007
|
%
of Sales
|
||||||||||
|
Net
Sales
|
$
|
59,505
|
100.0
|
%
|
$
|
54,159
|
100.0
|
%
|
|||||
|
Cost
of Sales
|
(48,270
|
)
|
81.1
|
%
|
(42,158
|
)
|
77.8
|
%
|
|||||
|
Gross
Profit
|
11,235
|
18.9
|
%
|
12,001
|
22.2
|
%
|
|||||||
|
Operating
Expenses
|
(7,993
|
)
|
13.4
|
%
|
(9,836
|
)
|
18.2
|
%
|
|||||
|
Operating
Income
|
3,242
|
5.4
|
%
|
2,165
|
4.0
|
%
|
|||||||
|
Interest
Expense
|
(493
|
)
|
0.8
|
%
|
(538
|
)
|
1.0
|
%
|
|||||
|
Other
Income
|
404
|
0.7
|
%
|
918
|
1.7
|
%
|
|||||||
|
Income
Before Income Taxes
|
3,153
|
5.3
|
%
|
2,545
|
4.7
|
%
|
|||||||
|
Income
Taxes
|
(700
|
)
|
1.2
|
%
|
(494
|
)
|
0.9
|
%
|
|||||
|
Net
Income
|
$
|
2,453
|
4.1
|
%
|
$
|
2,051
|
3.8
|
%
|
|||||
|
Net
Income Per Share:
|
|||||||||||||
|
Basic
Common
|
$
|
0.37
|
$
|
0.32
|
|||||||||
|
Basic
Class B Common
|
$
|
0.30
|
$
|
0.24
|
|||||||||
|
Diluted
|
$
|
0.34
|
$
|
0.29
|
|||||||||
|
Average
Shares Outstanding:
|
|||||||||||||
|
Basic
Common
|
5,114
|
4,962
|
|||||||||||
|
Basic
Class B Common
|
1,862
|
1,840
|
|||||||||||
|
Diluted
|
7,237
|
7,100
|
|||||||||||
|
Twelve
Months Ended July 31,
|
|||||||||||||
|
2008
|
%
of Sales
|
2007
|
%
of Sales
|
||||||||||
|
Net
Sales
|
$
|
232,359
|
100.0
|
%
|
$
|
212,117
|
100.0
|
%
|
|||||
|
Cost
of Sales
|
(186,289
|
)
|
80.2
|
%
|
(166,417
|
)
|
78.5
|
%
|
|||||
|
Gross
Profit
|
46,070
|
19.8
|
%
|
45,700
|
21.5
|
%
|
|||||||
|
Operating
Expenses
|
(33,340
|
)
|
14.3
|
%
|
(35,163
|
)
|
16.6
|
%
|
|||||
|
Operating
Income
|
12,730
|
5.5
|
%
|
10,537
|
5.0
|
%
|
|||||||
|
Interest
Expense
|
(2,189
|
)
|
0.9
|
%
|
(2,389
|
)
|
1.1
|
%
|
|||||
|
Other
Income
|
1,634
|
0.7
|
%
|
2,297
|
1.1
|
%
|
|||||||
|
Income
Before Income Taxes
|
12,175
|
5.2
|
%
|
10,445
|
4.9
|
%
|
|||||||
|
Income
Taxes
|
(3,136
|
)
|
1.3
|
%
|
(2,785
|
)
|
1.3
|
%
|
|||||
|
Net
Income
|
$
|
9,039
|
3.9
|
%
|
$
|
7,660
|
3.6
|
%
|
|||||
|
Net
Income Per Share:
|
|||||||||||||
|
Basic
Common
|
$
|
1.38
|
$
|
1.22
|
|||||||||
|
Basic
Class B Common
|
$
|
1.11
|
$
|
0.90
|
|||||||||
|
Diluted
|
$
|
1.25
|
$
|
1.09
|
|||||||||
|
Average
Shares Outstanding:
|
|||||||||||||
|
Basic
Common
|
5,068
|
4,902
|
|||||||||||
|
Basic
Class B Common
|
1,854
|
1,834
|
|||||||||||
|
Diluted
|
7,215
|
7,028
|
|||||||||||
Consolidated
Balance Sheets
(in
thousands, except for per share amounts)
(unaudited)
|
As
of July 31,
|
||||||||
|
2008
|
2007
|
|||||||
|
Current
Assets
|
||||||||
|
Cash
and Cash Equivalents
|
$
|
6,848
|
$
|
12,133
|
||||
|
Investment
in Treasury Securities
|
20,916
|
17,894
|
||||||
|
Accounts
Receivable, net
|
31,383
|
27,933
|
||||||
|
Inventories
|
17,744
|
15,237
|
||||||
|
Prepaid
Expenses
|
5,760
|
5,103
|
||||||
|
Total
Current Assets
|
82,651
|
78,300
|
||||||
|
Property,
Plant and Equipment
|
51,440
|
51,445
|
||||||
|
Other
Assets
|
14,897
|
12,342
|
||||||
|
Total
Assets
|
$
|
148,988
|
$
|
142,087
|
||||
|
Current
Liabilities
|
||||||||
|
Current
Maturities of Notes Payable
|
$
|
5,580
|
$
|
4,080
|
||||
|
Accounts
Payable
|
7,491
|
6,181
|
||||||
|
Dividends
Payable
|
919
|
833
|
||||||
|
Accrued
Expenses
|
16,111
|
16,311
|
||||||
|
Total
Current Liabilities
|
30,101
|
27,405
|
||||||
|
Long-Term
Liabilities
|
||||||||
|
Notes
Payable
|
21,500
|
27,080
|
||||||
|
Other
Noncurrent Liabilities
|
9,761
|
7,360
|
||||||
|
Total
Long-Term Liabilities
|
31,261
|
34,440
|
||||||
|
Stockholders'
Equity
|
87,626
|
80,242
|
||||||
|
Total
Liabilities and Stockholders' Equity
|
$
|
148,988
|
$
|
142,087
|
||||
|
Book
Value Per Share Outstanding
|
$
|
12.66
|
$
|
11.91
|
||||
|
Acquisitions
of
Property,
Plant and
Equipment
|
Fourth Quarter |
$
|
2,950
|
$
|
1,141
|
|||
|
|
Year
to Date
|
$
|
7,302
|
$
|
7,757
|
|||
|
Depreciation
and Amortization
Charges
|
Fourth Quarter |
$
|
1,859
|
$
|
1,951
|
|||
|
|
Year
to Date
|
$
|
7,455
|
$
|
7,498
|
|||
Consolidated
Statements of Cash Flows
(in
thousands)
(unaudited)
|
For
the Twelve Months Ended
|
|||||||
|
July
31,
|
|||||||
|
|
2008
|
2007
|
|||||
|
CASH
FLOWS FROM OPERATING ACTIVITIES
|
|||||||
|
Net
Income
|
$
|
9,039
|
$
|
7,660
|
|||
|
Adjustments
to reconcile net income to net cash provided
by operating activities:
|
|||||||
|
Depreciation
and Amortization
|
7,455
|
7,498
|
|||||
|
(Increase)
in Accounts Receivable
|
(3,538
|
)
|
(2,141
|
)
|
|||
|
(Increase)
Decrease in Inventories
|
(2,507
|
)
|
460
|
||||
|
Increase
(Decrease) in Accounts Payable
|
1,438
|
(934
|
)
|
||||
|
(Decrease)
Increase in Accrued Expenses
|
(200
|
)
|
1,628
|
||||
|
Other
|
(346
|
)
|
2,680
|
||||
|
Total
Adjustments
|
2,302
|
9,191
|
|||||
|
Net
Cash Provided by Operating Activities
|
11,341
|
16,851
|
|||||
|
CASH
FLOWS FROM INVESTING ACTIVITIES
|
|||||||
|
Capital
Expenditures
|
(7,302
|
)
|
(7,757
|
)
|
|||
|
Purchase
of Strategic Intangible Assets
|
(1,300
|
)
|
—
|
||||
|
Net
(Purchases) Dispositions of Investment Securities
|
(2,331
|
)
|
2,233
|
||||
|
Other
|
43
|
57
|
|||||
|
Net
Cash Used in Investing Activities
|
(10,890
|
)
|
(5,467
|
)
|
|||
|
CASH
FLOWS FROM FINANCING ACTIVITIES
|
|||||||
|
Principal
payments on Long-Term Debt
|
(4,080
|
)
|
(4,080
|
)
|
|||
|
Dividends
Paid
|
(3,377
|
)
|
(3,038
|
)
|
|||
|
Purchase
of Treasury Stock
|
(20
|
)
|
(16
|
)
|
|||
|
Other
|
1,811
|
1,588
|
|||||
|
Net
Cash Used in Financing Activities
|
(5,666
|
)
|
(5,546
|
)
|
|||
|
Effect
of exchange rate changes on cash and cash
equivalents
|
(70
|
)
|
(312
|
)
|
|||
|
Net
(Decrease) Increase in Cash and Cash Equivalents
|
(5,285
|
)
|
5,526
|
||||
|
Cash
and Cash Equivalents, Beginning of Year
|
12,133
|
6,607
|
|||||
|
Cash
and Cash Equivalents, July 31
|
$
|
6,848
|
$
|
12,133
|
|||