CONFORMED COPY
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-Q
Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the Quarter Ended October 31, 1994 Commission File Number 0-8675
OIL-DRI CORPORATION OF AMERICA
(Exact name of registrant as specified in its charter)
DELAWARE 36-2048898
(State or other jurisdiction of (I.R.S. Employer
Incorporation or organization) Identification No.)
410 North Michigan Avenue
Chicago, Illinois 60611
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (312) 321-1515
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months and (2) has been subject to such
filing requirements for at least the past 90 days.
Yes X No
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the close of the period covered by this report.
Common Stock - 5,100,623 Shares (Including 283,696 Treasury Shares)
Class B Stock - 2,132,895 Shares
<PAGE>
OIL-DRI CORPORATION OF AMERICA & SUBSIDIARIES
Consolidated Statement of Financial Position
ASSETS
[CAPTION]
<TABLE>
October 31 July 31
(Unaudited)
1994 1993 1994
CURRENT ASSETS
<S> <C> <C> <C>
Cash and Cash Equivalents $ 2,248,147 $ 2,586,077 $ 6,394,315
Investment Securities, at Cost 3,586,569 5,234,971 3,351,423
Accounts Receivable 24,424,847 19,619,457 19,854,899
Allowance for Doubtful Accounts (186,038) (211,144) (171,940)
Inventories 12,592,104 9,719,105 11,203,008
Prepaid Expenses and Taxes 3,879,701 3,164,016 3,730,298
Total Current Assets 46,545,330 40,112,482 44,362,003
<CAPTION>
PROPERTY, PLANT AND EQUIPMENT - AT COST
<S> <C> <C> <C>
Cost 102,235,020 90,304,566 100,192,811
Less Accumulated Depreciation and
Amortization 41,763,672 35,623,509 39,949,247
Total Property, Plant
and Equipment, Net 60,471,348 54,681,057 60,243,564
OTHER ASSETS
Excess of Investment Subsidiary
Over Fair Value of Assets (Net
<S> <C> <C> <C>
of Accumulated amortization) 4,403,394 4,527,859 4,436,334
Other 3,346,939 2,835,546 3,225,281
Total Other 7,750,333 7,363,405 7,661,615
Assets
TOTAL ASSETS $114,767,011 $102,156,944 $112,267,182
</TABLE>
<PAGE>
OIL-DRI CORPORATION OF AMERICA & SUBSIDIARIES
Consolidated Statement of Financial Position
LIABILITIES & STOCKHOLDERS EQUITY
<TABLE>
<CAPTION>
October 31 July 31
(Unaudited)
1994 1993 1994
CURRENT LIABILITIES
<S> <C> <C> <C>
Current Maturities of Note
Payable $ 649,944 $1,017,142 $ 1,243,479
Accounts Payable - Trade 5,258,876 4,005,840 4,677,793
Income Taxes Payable - 296,812 -
Dividends Payable 520,552 454,117 449,302
Accrued Expenses 9,377,605 8,505,606 9,230,664
Total Current Liabilities 15,806,977 14,279,517 15,601,238
<CAPTION>
NONCURRENT LIABILITIES
<S> <C> <C> <C>
Notes Payable 21,519,373 17,170,020 21,521,243
Deferred Income Taxes 326,284 1,209,486 323,379
Deferred Compensation 1,610,740 1,456,309 1,761,818
Total Noncurrent Liabilities 23,456,397 19,835,815 23,606,440
Total Liabilities 39,263,374 34,115,332 39,207,678
<CAPTION>
STOCKHOLDERS EQUITY
<S> <C> <C> <C>
Common Stock 723,352 720,208 723,352
Paid-In Capital in Excess of Par
Value 7,657,394 7,255,015 7,657,394
Retained Earnings 72,375,658 64,151,733 70,077,278
Cumulative Translation Adjustment (954,458) (1,026,811) (1,135,951)
79,801,946 71,100,145 77,322,073
Less Treasury Stock, At Cost 4,298,309 3,058,533 4,262,569
Total Stockholders 75,503,637 68,041,612 73,059,504
Total Liabilities & Stockholders
Equity $114,767,011 $102,156,944 $112,267,182
</TABLE>
<PAGE>
OIL-DRI CORPORATION OF AMERICA & SUBSIDIARIES
Consolidated Statement of Income and Retained Earnings
Three Months Ended October 31
<TABLE>
<CAPTION>
1994 1993
(Unaudited) (Unaudited)
<S> <C> <C>
Net Sales $36,799,337 $33,554,070
Cost Of Sales 26,631,621 23,824,916
Gross Profit 10,167,716 9,729,154
Selling, General And Administrative
Expenses 5,995,711 5,984,119
Operating Income 4,172,005 3,745,035
OTHER INCOME (EXPENSE)
Interest Expense (487,535) (389,325)
Interest Income 103,539 99,248
Foreign Exchange Gain (Loss) 3,369 1,233
Other, Net (21,496) (15,152)
(402,123) (303,996)
Income Before Income Taxes 3,769,882 3,441,039
Income Taxes 950,950 866,300
Net Income 2,818,932 2,574,739
RETAINED EARNINGS
Balance at Beginning of Year 70,077,278 62,031,814
Less: Cash Dividends Declared 520,552 454,820
Retained Earnings - October 31 $72,375,658 $64,151,733
Average Shares Outstanding 6,957,700 7,027,506
Net Income Per Share $ 0.41 $ 0.37
</TABLE>
<PAGE>
OIL-DRI CORPORATION OF AMERICA & SUBSIDIARIES
Consolidated Statement of Cash Flows
For the Three Months Ended October 31 (Unaudited)
<TABLE>
<CAPTION>
1994 1993
Unaudited Unaudited
CASH FLOWS FROM OPERATING ACTIVITIES
<S> <C> <C>
Net Income $2,818,932 $2,574,739
Adjustments to Reconcile Net Income to
Net Cash
Provided by Operating Activities:
Depreciation and Amortization 1,821,537 1,558,384
Provision for bad debts 9,229 24,232
(Increase) Decrease in:
Accounts Receivable (4,515,026) (1,231,276)
Inventories (1,350,335) (1,697,586)
Prepaid Expenses and Taxes (154,179) (365,412)
Other Assets (97,794) (40,199)
Increase (Decrease) in:
Accounts Payable 595,723 (1,595,002)
Income Taxes Payable - 60,945
Accrued Expenses 168,050 165,683
Deferred Compensation (151,078) 76,363
Total Adjustments (3,673,873) (3,053,748)
Net Cash Used In Operating Activities ( 854,941) (479,009)
CASH FLOWS FROM INVESTING ACTIVITIES
Capital Expenditures (2,025,333) (2,528,594)
Purchases of Investment Securities (2,116,842) (4,251,980)
Dispositions of Investment Securities 1,905,413 4,610,717
Other 7,600 -
Net Cash Used in Investing Activities (2,229,162) (2,169,857)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from Short Term Borrowings - 362,895
Principal Payments on Long Term Debt (595,405) (684,289)
Proceeds from Issuance of Common Stock - 294,935
Dividends Paid (455,483) (453,452)
Foreign Currency TranslatioN
Adjustment 24,563 94,350
Purchases of Treasury Stock (35,740) (690,726)
Net Cash Used In Financing Activities (1,062,065) (1,076,287)
Net (Decrease) in Cash and Cash
Equivalents (4,146,168) (3,725,153)
Cash and Cash Equivalents, Beginning of
Year 6,394,315 6,311,230
Cash and Cash Equivalents, October 31 $ 2,248,147 $2,586,077
</TABLE>
<PAGE>
MANAGEMENT DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
THREE MONTHS ENDED OCTOBER 31, 1994 COMPARED TO THREE
MONTHS ENDED OCTOBER 31, 1993
RESULTS OF OPERATIONS
Consolidated net sales for the three months ended October 31, 1994 were
$36,799,000, an increase of $3,245,000, or 9.7%, over sales of $33,554,000
in the first three months of fiscal 1994. Net income for the three months
ended October 31, 1994 was $2,819,000 or $0.41 per share, an increase of
9.5% from $2,575,000 or $0.37 per share earned in the first quarter of
fiscal 1994.
Net sales of industrial and environmental sorbents decreased $241,000 from
prior year levels. Sales of industrial clay absorbents decreased slightly
in dollar volume while sales of nonclay sorbents decreased $202,000 or
13.1%, reflecting increased competition in the markets in which the Company
participates. Sales of cat box absorbents increased $2,484,000 or 14.7%
from fiscal 1994 first quarter results. This growth is primarily the
result of sales increases in branded and private label products, both
scoopable and traditional coarse litter, in both the grocery and mass
merchandise markets. Sales of agricultural absorbents increased $397,000
or 9.2% from fiscal 1994. Worldwide sales of fluid filtration and
purification products remained unchanged from prior year levels.
Consolidated gross profit as a percentage of net sales for the three months
ended October 31, 1994 decreased to 27.6% from 29.0% in the first three
months of fiscal 1993. Changes in sales mix towards greater value added
products was offset by increased costs of packaging materials and shipping.
Operating expenses as a percentage of net sales decreased to 16.3% in the
first quarter of fiscal 1995 from 17.8% in the first quarter of fiscal
1994. This change reflects continued emphasis on controlling variable
costs and matching fixed overhead costs to volume.
Interest expense increased $98,200 due to increased debt levels. Interest
income increased slightly.
The Companys effective tax rate was unchanged at 25.5% of income in the
first quarter of 1995 as compared to 25.2% the first quarter of fiscal
1994.
Total assets of the Company increased $2,500,000 during the three months
ended October 31, 1994. Current assets increased $2,183,000 or 4.9% from
fiscal year end balances reflecting increased accounts receivable and
inventory balances offset against reduced cash and investments to fund
increased sales. Property, plant and equipment, net of accumulated
depreciation, increased $228,000.
Total liabilities in the three months ended October 31, 1994 increased
slightly. Current liabilities increased $206,000 or 1.3% from July 31,
1994 balances while noncurrent liabilities decreased $150,000 or 0.6% from
year end.
The Company expects recent sales patterns to continue in fiscal 1995.
Growth is expected to come primarily from the cat box and fluid
purification product lines. Consumer growth is expected to be achieved
through increased distribution in the grocery industry and by maintaining
the Companys strong position in the fast growing mass merchandising and
warehouse club outlets. Growth of specialty adsorbents is expected to
continue with increased market penetration of the Companys value-added
fluid filtration and purification products. Finally, the Companys
recently completed expansion of its Ripley, Mississippi manufacturing
facility is expected to provide significant new capacity for the
agricultural product line, relieving capacity constraints experienced
during fiscal 1994.
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES
The current ratio increased to 2.94 at October 31, 1994 from 2.84 at July
31, 1994. Working capital increased $1,978,000 in the three months ended
October 31, 1994 to $30,738,000. Cash provided by operations continues to
be the Companys primary source of funds to finance operating needs and
capital expenditures. During the quarter the balances of cash, cash
equivalents and other investments declined $3,911,000. This reduction in
cash and investments was used to fund capital expenditures of $2,025,000,
to pay dividends of $455,000 and to reduce debt by $595,000. Total cash and
investment balances held by the Companys foreign subsidiaries at October
31, 1994 and 1993 were $3,501,000 and $4,408,000 respectively.
FOREIGN OPERATIONS
The Companys net sales by its foreign subsidiaries for the three months
ended October 31, 1994 were $2,775,000 constituting 7.5% of sales. This
represents a increase of $244,000 or 9.6%, primarily due to increased sales
in Canada, from the first quarter of fiscal 1994 in which foreign
subsidiary sales were $2,531,000 and constituted 7.5% of sales. Net
income of the Companys foreign subsidiaries for the three months ended
October 31, 1994 was $94,000 compared with $257,000 in the first quarter
of fiscal 1994. Identifiable assets of the Companys foreign subsidiaries
as of October 31, 1994 were $9,803,000 an decrease of $1,113,000
from $10,916,000 as of October 31, 1993.
<PAGE>
Part II - Other Information
Item 5. (a) Exhibits: The following documents are an exhibit to
this report. Exhibit - 11 - Statement Re: Computation
of per share earnings.
(b) During the quarter for which this report is filed, no
reports on Form 8-K were filed.
<PAGE>
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 thereunto duly authorized.
OIL-DRI CORPORATION OF AMERICA
(Registrant)
BY /s/ Donald J. Deegan
Donald J. Deegan
Director of Finance and Accounting,
Chief Accounting Officer
BY /s/ Richard M. Jaffee
Richard M. Jaffee
President
Dated: December 14, 1994
<PAGE>
INDEX TO EXHIBITS
EXHIBIT NUMBER EXHIBIT TITLE SEQUENTIALLY NUMBER PAGE
(11) Statement Re:
Computation of Per Share 12
Earnings
<PAGE>
<TABLE>
Exhibit 11
OIL-DRI CORPORATION OF AMERICA
Computation of Weighted Average Number
of Shares Outstanding
<CAPTION>
Average
Shares-
(Weighted
Number Number of Shares) Number
of Shares Weighted of Days
Quarter End Period Days Outstanding Shares As Adjusted
<S> <C> <C> <C> <S><C> <C> <C> <C>
October 31, 1994 08/01/94 to 08/08/94 8 6,951,822 55,614,576
08/09/94 to 10/31/94 84 6,949,822 583,785,048
92 639,399,624 6,949,996
Assuming exercise of options reduced by the number of shares
which could have been purchased with the proceeds from
exercise of such options.
<C>
7,704
<C>
6,957,700
<S> <C> <C> <C> <S><C> <C> <C> <C>
October 31, 1993 08/01/93 to 08/11/93 11 6,991,285 76,904,135
08/12/92 to 08/23/93 12 6,993,827 83,925,924
08/24/92 to 09/02/93 10 6,995,174 69,951,740
09/03/93 to 09/14/93 12 6,995,638 83,947,656
09/15/93 to 09/19/93 5 6,996,416 34,982,080
09/20/93 to 09/21/93 2 6,997,041 13,994,082
09/22/93 to 09/29/93 8 6,998,121 55,984,968
09/30/93 to 10/03/93 4 6,993,121 27,972,484
10/04/93 to 10/17/93 14 6,988,121 97,833,694
10/18/93 1 6,983,121 6,983,121
10/19/93 to 10/24/93 6 6,978,121 41,868,726
10/25/93 to 10/28/93 4 6,978,972 27,915,888
10/29/93 to 10/31/93 3 6,980,823 20,942,469
<C> <C> <C>
92 643,206,967 6,991,380
Assuming exercise of options reduced by the number of shares
which could have been purchased with the proceeds from
exercise of such options.
<C>
36,126
<C>
7,027,506
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> QTR-1
<FISCAL-YEAR-END> JUL-31-1994
<PERIOD-END> OCT-31-1994
<CASH> 2,248,147
<SECURITIES> 3,586,569
<RECEIVABLES> 24,424,847
<ALLOWANCES> (186,038)
<INVENTORY> 12,592,104
<CURRENT-ASSETS> 46,545,330
<PP&E> 102,235,020
<DEPRECIATION> 41,763,672
<TOTAL-ASSETS> 114,767,011
<CURRENT-LIABILITIES> 15,806,977
<BONDS> 21,519,373
<COMMON> 723,352
0
0
<OTHER-SE> 74,780,285
<TOTAL-LIABILITY-AND-EQUITY> 114,767,011
<SALES> 36,799,337
<TOTAL-REVENUES> 36,799,337
<CGS> 26,631,621
<TOTAL-COSTS> 33,980,405
<OTHER-EXPENSES> 402,123
<LOSS-PROVISION> 9,229
<INTEREST-EXPENSE> 487,535
<INCOME-PRETAX> 3,769,882
<INCOME-TAX> 950,950
<INCOME-CONTINUING> 2,818,932
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,818,932
<EPS-PRIMARY> 0.41
<EPS-DILUTED> 0.41
</TABLE>
