Oil-Dri Faces Competition from New Offerings from Major Competitors

Oil-Dri Corporation of America of Chicago, IL has announced net sales of US$65.2 million for its third quarter ended April 30, 2015 compared with US$67.4 million in the same period of 2014. Net income increased from US$722,000 to US$1.38 million. The company notes that the results reflect moderating cost pressures and reduced promotional consumer market spending. Daniel S Jaffee, Oil-Dri’’s CEO, said, “In the consumer market, continued competitive activity supporting new product offerings by our major competitors put pressure on our cat litter sales. According to the most recent 12 week data available from an independent market reporting service, the lightweight scoopable litter segment of the cat litter category continues to grow and now represents 18.4% of the scoopable segment, while other sub-segments, including coarse litter, continue to decline. “In the Business-to-Business segment, the decrease in the sales of our fluid purification products was the key driver in the reduced sales for the segment. Our agricultural and animal health businesses contributed to our performance with increased sales and profitability for the quarter.” Oil-Dri’’s Business-to-Business products group’s third quarter operating income increased 25%, to US$6.7 million on net sales 3% lower at US$21.9 million. Net sales of fluid purification products were approximately 18% lower primarily as a result of fewer tons sold. In addition, sales in foreign markets suffered due to the strength of the US dollar. The group’s co-packaged traditional coarse cat litter net sales reflected the continued decline in the coarse litter market and were down approximately 7% compared with the third quarter of the prior year. Partially offsetting these declines were approximately 39% higher sales of the group’s standard and engineered granule products used by agricultural and horticultural chemical producers. Oil-Dri’’s Retail and Wholesale segment recorded an operating income of US$373,000 on net sales of US$43.3 million versus an operating loss of US$694,000 million on net sales of US$44.9 million in the same period of 2014. The segment’s private label cat litter sales increased approximately 6%. The increased sales were attributed to new customers and sales of its new lightweight private label cat litter products, which launched at the end of the second quarter of fiscal 2015. Branded and generic floor absorbent sales increased approximately 7% as the result of increased volume and a higher average selling price.

Volume 29 issue 11

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