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 April 30, 1995 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 - 5,118,824 Shares (Including 332,196 Treasury Shares)
Class B Stock - 2,114,694 Shares
<PAGE>
OIL-DRI CORPORATION OF AMERICA & SUBSIDIARIES
Consolidated Statement of Financial Position
ASSETS
<TABLE>
<CAPTION>
April 30 July 31
(Unaudited)
1995 1994 1994
CURRENT ASSETS
<S> <C> <C> <C>
Cash and Cash Equivalents $ 7,245,120 $ 8,474,756 $ 6,394,315
Investment Securities, at Cost 1,602,028 4,760,889 3,351,423
Accounts Receivable 22,686,856 20,863,356 19,854,899
Allowance for Doubtful Accounts ( 603,482) ( 242,618) ( 171,940)
Inventories 10,551,549 9,916,081 11,203,008
Prepaid Expenses and Taxes 6,642,597 4,142,662 3,730,298
Total Current Assets 48,124,668 47,915,126 44,362,003
PROPERTY, PLANT AND EQUIPMENT - AT COST
Cost 105,551,718 95,043,969 100,192,811
Less Accumulated Depreciation and
Amortization (45,543,896) (38,186,425) (39,949,247)
Total Property, Plant
and Equipment, Net 60,007,822 56,857,544 60,243,564
OTHER ASSETS
Excess of Investment in
Subsidiaries
Over Fair Value of Assets (Net
of Accumulated Amortization) 4,337,514 4,469,515 4,436,334
Other 3,755,190 3,290,638 3,225,281
Total Other Assets 8,092,704 7,760,153 7,661,615
TOTAL ASSETS $116,225,194 $112,532,823 $112,267,182
</TABLE>
<PAGE>
OIL-DRI CORPORATION OF AMERICA & SUBSIDIARIES
Consolidated Statement of Financial Position
LIABILITIES & STOCKHOLDERS EQUITY
<TABLE>
<CAPTION>
April 30 July
(Unaudited)
1995 1994 1994
CURRENT LIABILITIES
<S> <C> <C> <C> <C>
Current Maturities of Notes $ 597,959 $ 1,279,361 $ 1,243,479
Payable
Accounts Payable - Trade 4,893,316 4,527,369 4,677,793
Dividends Payable 518,836 468,859 449,302
Accrued Expenses 9,222,145 9,530,770 9,230,664
Total Current Liabilities 15,232,256 15,806,359 15,601,238
NONCURRENT LIABILITIES
Notes Payable 20,925,659 21,524,621 21,521,243
Deferred Income Taxes 325,406 754,796 323,379
Deferred Compensation 1,722,484 1,580,151 1,761,818
Other 273,706 - -
Total Noncurrent
Liabilities 23,247,255 23,859,568 23,606,440
Total Liabilities 38,479,511 39,665,927 39,207,678
STOCKHOLDERS EQUITY
Common Stock 723,352 723,336 723,352
Paid-In Capital in Excess of Par 7,657,394 7,654,851 7,657,394
Value
Retained Earnings 75,449,203 68,850,188 70,077,278
Cumulative Translation Adjustment (996,222) (1,049,054) (1,135,951)
82,833,727 76,179,321 77,322,073
Less Treasury Stock, At Cost (5,088,044) (3,312,425) (4,262,569)
Total Stockholders
Equity 77,745,683 72,866,896 73,059,504
TOTAL LIABILITIES & STOCKHOLDERS $116,225,194 $112,532,823 $112,267,182
EQUITY
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
OIL-DRI CORPORATION OF AMERICA & SUBSIDIARIES
Consolidated Statement of Income and Retained Earnings
Nine Months Ended April 30
1995 1994
(Unaudited) (Unaudited)
<S> <C> <C>
Net Sales $109,360,556 $108,274,994
Cost Of Sales 81,371,973 78,624,184
Gross Profit 27,988,583 29,650,810
Selling, General And Administrative 17,281,450 17,953,434
Expenses
Operating Income 10,707,133 11,697,376
OTHER INCOME (EXPENSE)
Interest Expense (1,457,217) (1,213,222)
Interest Income 286,137 262,981
Foreign Exchange Gain (Loss) (4,514) 5,111
Other, Net (168,325) 85,962
(1,343,919) (859,168)
Income Before Income Taxes 9,363,214 10,838,208
Income Taxes 2,430,985 2,656,933
Net Income 6,932,229 8,181,275
RETAINED EARNINGS
Balance at Beginning of Year 70,077,278 62,031,814
Less Cash Dividends Declared (1,560,304) (1,362,901)
Retained Earnings - April 30 $75,449,203 $68,850,188
Average Shares Outstanding 6,947,709 7,017,894
Net Income Per Share $1.00 $1.17
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
OIL-DRI CORPORATION OF AMERICA & SUBSIDIARIES
Consolidated Statement of Income and Retained Earnings
Three Months Ended April 30
1995 1994
(Unaudited) (Unaudited)
<S> <C> <C>
Net Sales $34,732,345 $37,270,906
vost Of Sales 26,750,874 27,998,348
Gross Profit 7,981,471 9,272,558
Selling, General And Administrative 5,411,016 5,952,705
Expenses
Operating Income 2,570,455 3,319,853
OTHER INCOME (EXPENSE)
Interest Expense (472,309) (409,423)
Interest Income 118,797 86,135
Foreign Exchange Gain (Loss) 6,735 (431)
Other, Net (99,417) 89,862
(446,194) (233,857)
Income Before Income Taxes 2,124,261 3,085,996
Income Taxes 584,254 730,008
Net Income $ 1,540,007 $ 2,355,988
Average Shares Outstanding 6,928,923 7,014,995
Net Income Per Share $ 0.22 $ 0.34
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
OIL-DRI CORPORATION OF AMERICA & SUBSIDIARIES
Consolidated Statement of Cash Flows
For the Nine Months Ended April 30
1995 1994
Unaudited Unaudited
CASH FLOWS FROM OPERATING ACTIVITIES
<S> <C> <C>
Net Income $6,932,229 $8,181,275
Adjustments to Reconcile Net Income to
Net Cash
Provided by Operating Activities:
Depreciation and Amortization 5,796,844 4,748,936
Provision for bad debts 38,843 56,487
(Increase) Decrease in:
Accounts Receivable (2,397,324) (2,492,384)
Inventories 687,155 (1,904,614)
Prepaid Expenses and Taxes (2,932,901) (1,607,148)
Other Assets ( 475,768) (381,839)
Increase (Decrease) in:
Accounts Payable 212,120 (942,454)
Accrued Expenses 15,262 1,208,227
Deferred Taxes and Noncurrent
Income Taxes - (461,144)
Deferred Compensation ( 39,334) 200,205
Other 273,706 -
Total Adjustments 1,178,603 (1,575,728)
Net Cash Used In Operating Activities 8,110,832 6,605,547
CASH FLOWS FROM INVESTING ACTIVITIES
Capital Expenditures (5,464,611) (8,169,961)
Purchases of Investment Securities (2,781,036) (8,014,406)
Dispositions of Investment Securities 4,534,553 8,726,762
Other 19,698 295,175
Net Cash Used in Investing Activities (3,691,396) (7,162,430)
CASH FLOWS FROM FINANCING ACTIVITIES
Principal Payments on Long-Term Debt (1,241,104) (741,319)
Proceeds from Issuance of Long-Term
Debt - 5,036,745
Proceeds from Issuance of Common Stock - 697,899
Dividends Paid (1,496,951) (1,346,791)
Foreign Currency Translation
Adjustment (5,101) 18,493
Purchases of Treasury Stock (825,475) (944,618)
Net Cash Used In Financing Activities (3,568,631) 2,720,409
Net (Decrease) in Cash and Cash
Equivalents 850,805 2,163,526
Cash and Cash Equivalents, Beginning of 6,394,315 6,311,230
Year
Cash and Cash Equivalents, April 30 $7,245,120 $8,474,756
</TABLE>
<PAGE>
MANAGEMENT DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
NINE MONTHS ENDED APRIL 30, 1995 COMPARED TO NINE
MONTHS ENDED APRIL 30, 1994
RESULTS OF OPERATIONS
Consolidated net sales for the nine months ended April 30, 1995 were
$109,361,000, an increase of 1.0% over net sales of $108,275,000 in the
first nine months of fiscal 1994. Net income for the first nine months of
fiscal 1995 was $6,932,000 or $1.00 per share, a decrease of 15.3% from
$8,181,000 or $1.17 per share earned in the nine months ended April 30,
1994.
Domestic and U.S. Export Sales
Domestic net sales of industrial and environmental sorbents decreased
$724,000 (5.1%) from prior years levels. Sales of industrial clay
sorbents decreased slightly by $229,000 (2.5%) while sales of non-clay
sorbents decreased $495,000 (10.1%)from the same period last year. The non-
clay sorbents market continues to exhibit increasing competition in the
markets in which the Company participates. Domestic net sales of cat box
absorbents increased $1,405,000 (2.7%)from the same period last year. This
growth is the result of increased shipments of scoopable cat litters in
both grocery and mass merchandise markets, and increased sales of coarse
cat litters in the mass merchandise market, predominantly private labels.
Domestic net sales of agricultural products decreased $1,016,000 (7.0%)
from the same period last fiscal year due to production schedule changes at
certain agricultural chemical producers. Sales of specialty absorbents,
primarily fluid filtration and purification products decreased $416,000
(5.3%) from fiscal 1994 due primarily to reduced demand associated with
high quality crude oil being refined and the effect of increased competition.
Sales by the Companys transportation subsidiary increased $740,000 due to
expansion of the fleet.
Gross Margins
Consolidated gross profits as a percentage of net sales for the nine months
ended April 30, 1995 decreased to 25.6% from 27.4% in the first nine months
of fiscal 1994. A number of factors contributed to this decline, including
a) changes in sales mix towards lower margin products, particularly in the
consumer market, b) increased costs of packaging materials and
transportation which, due to competitive pressures, have not been fully
recovered in the form of price increases, and, c) in the third quarter, reduced
production, resulting in lower absorption of fixed overhead.
Operating and Expenses and Interest
Operating expenses as a percentage of net sales decreased to 15.8% in the
nine months ended April 30, 1995 from 16.6% in the same period last year.
This change reflects continued selling and administrative cost controls.
Interest expense increased $244,000 due to increased average debt
outstanding. Interest income increased slightly from fiscal 1994 due to
interest rate increases.
Taxes
The Companys effective tax rate was 26.0% of income in the first nine
months of fiscal 1995 as compared to 24.5% in the same period last year.
This change is a result of two factors: a lower share of domestic income
was subject to depletion allowances and a greater share of total income was
earned by higher tax paying foreign subsidiaries.
<PAGE>
Balance Sheet
Total assets of the Company increased $3,958,000 from fiscal year end
balances. Current assets increased $3,763,000 from year end due to higher
accounts receivable, inventory and prepaid balances. Property, plant and
equipment, net of accumulated depreciation, decreased $236,000.
Total liabilities decreased $728,000 in the nine months ended April 30,
1995. Current liabilities decreased $369,000 while non-current liabilities
decreased $359,000 from July 31, 1994.
Outlook for the Coming Quarter
The Company anticipates that sales for the last quarter of the fiscal year
will not materially change from the same period in fiscal 1994. With the
leveling of sales in the quarter, earnings are not anticipated to exceed
those of the fourth quarter of fiscal 1994.
LIQUIDITY AND CAPITAL RESOURCES
The current ratio increased to 3.16 at April 30, 1995 from 2.84 at July 31,
1994. Working capital increased $4,131,000 in the nine months ended April
30, 1995 to $32,892,000. Cash provided by operations continues to be the
Companys primary source of funds to finance operating needs and capital
expenditures. During the first nine months of the fiscal year, balances of
cash equivalents and other investments increased $851,000. Cash provided
by operating activities was used to fund capital expenditures of
$5,465,000, to pay dividends of $1,497,000, to reduce long-term debt by
$1,241,000 and to repurchase shares of the Companys common stock at a cost
of $825,000. Total cash and investment balances held by the Companys
foreign subsidiaries at April 30, 1995 and 1994 were $2,898,000 and
$4,276,000 respectively.
THREE MONTHS ENDED APRIL 30, 1995 COMPARED TO
THREE MONTHS ENDED APRIL 30, 1994
RESULTS OF OPERATIONS
Consolidated net sales for the three months ended April 30, 1995 were
$34,732,345 a decrease of 7.3% from net sales of $37,271,000 in the same
period last year. Net income for the quarter ended April 30, 1995 was
$1,540,000 or $0.22 per share, a decrease of 34.6% from net income of
$2,356,000 or $0.34 per share reported in the quarter ended April 30, 1994.
Domestic and U.S. Export Sales
Domestic net sales of industrial and environmental sorbents decreased
$543,000 (10.3%). Sales of industrial clay sorbents decreased $217,000
(6.4%). Sales of non-clay sorbents decreased $326,000 (17.2%). Domestic
net sales of cat box absorbents, agricultural products and specialty
absorbents decreased $1,539,000 (9.5%), $604,000 (11.5%) and $64,000
(14.0%) respectively in the third quarter of fiscal 1995 compared to the
same period last year. Sales by transportation services increased $413,000
(17.3%)in the third quarter of fiscal 1995 as compared to the third quarter
of fiscal 1994.
The decrease in sales of cat box absorbents was related to two factors: a)
changes in the timing and extent of promotional activities scheduled during
this years third quarter vs. last year, and b) milder weather than during
the same period last year, reducing demand for cat litter as a traction
aid. Other factors contributing to these quarterly variations are
substantially the same as those noted above for the first 9 months of the
fiscal year.
<PAGE>
Gross Profits
Gross profit for the three months ended April 30, 1995 decreased to 23.0%
of sales as compared to 24.9% in the third quarter of fiscal 1994.
Operating Expenses and Interest
Operating expenses decreased slightly to 15.6% of sales in the third
quarter of fiscal 1995 from 16.0% in the same period last year. Interest
expense in the third quarter of fiscal 1995 compared to the third quarter
of fiscal 1994 increased $63,000. Interest income increased $33,000 in the
same period.
Taxes
The Companys effective tax rate in the third quarter of fiscal 1995 was
27.5% of income as compared to 23.7% in the same period last year.
FOREIGN OPERATIONS
The Companys net sales by its foreign subsidiaries for the nine months
ended April 30, 1995 were $8,625,000 constituting 7.9% of sales. This
represents an increase of $907,000 or 11.8% from the first nine months of
fiscal 1994 in which foreign subsidiary sales were $7,718,000 and
constituted 7.1% of sales. This increase is primarily due to increased
sales of cat box absorbents in Canada. Net incomeof the Companys foreign
subsidiaries for the nine months ended April 30,1995 was $358,000 compared
with $206,000 in the first nine months of fiscal 1994. Identifiable
assets of the Companys foreign subsidiaries as of April 30, 1995 were
$9,408,000 a slight decrease from 9,608,000 as of July 31, 1994.
The Companys net sales by its foreign subsidiaries for the three months
ended April 30, 1995 were $2,727,000 constituting 7.9% of sales. This
represents an increase of $169,000 or 6.6% from the third quarter of fiscal
1994 in which foreign subsidiary sales were $2,558,000 and constituted 6.9%
of sales. Net income of the Companys foreign subsidiaries for the three
months ended April 30, 1995 was $137,100 compared with $49,000 in the third
quarter of fiscal 1995.
<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: June 5, 1995
Exhibit 11
OIL-DRI CORPORATION OF AMERICA
Computation of Weighted Average Number
of Shares Outstanding
<TABLE>
<CAPTION>
Average
Shares-
(Weighted
Number Number of Shares) Number
of Shares Weighted of Days
Quarter End Period Days Outstanding Shares As Adjusted
<C> <C> <C> <C> <S><C> <C> <C> <C>
April 30, 1995 02/01/95 to 2/28/95 28 6,949,822 194,595,016
03/01/95 to 3/01/95 1 6,946,922 6,946,922
03/02/95 to 3/02/95 1 6,945,922 6,945,922
03/03/95 to 3/05/95 3 6,943,922 20,831,766
03/06/95 to 3/06/95 1 6,942,722 6,942,722
03/07/95 to 3/07/95 1 6,936,522 6,936,522
03/08/95 to 3/09/95 2 6,934,822 13,869,644
03/10/95 to 3/13/95 4 6,932,822 27,731,288
03/14/95 to 3/14/95 1 6,932,322 6,932,322
03/15/95 to 3/15/95 1 6,931,322 6,931,322
03/16/95 to 3/19/95 4 6,929,822 27,719,288
03/20/95 to 3/20/95 1 6,928,822 6,928,822
03/21/95 to 3/21/95 1 6,928,322 6,928,322
03/22/95 to 3/22/95 1 6,927,822 6,927,822
03/23/95 to 3/23/95 1 6,927,322 6,927,322
03/24/95 to 3/26/95 3 6,911,322 20,733,966
03/27/95 to 4/30/95 35 6,901,322 241,546,270
<C> <C> <C>
89 616,375,258 6,925,565
Assuming exercise of options reduced by the number of shares
which could have been purchased with the proceeds from
exercise of such options.
3,358
<C> <S><C> <C> <C> <C> <C>
<C>
6,928,923
<C> <C> <C> <C> <S><C> <C> <C> <C>
April 30, 1995 02/01/94 to 3/21/94 49 6,998,285 342,915,965
03/22/94 to 4/30/94 40 6,999,966 279,998,640
<C> <C> <C>
89 622,914,605 6,999,041
Assuming exercise of options reduced by the number of shares
which could have been purchased with the proceeds from
exercise of such options.
<C>
15,954
<C>
7,014,995
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUL-31-1995
<PERIOD-END> APR-30-1995
<CASH> 7,245,120
<SECURITIES> 1,602,028
<RECEIVABLES> 22,686,856
<ALLOWANCES> (603,482)
<INVENTORY> 10,551,549
<CURRENT-ASSETS> 48,124,668
<PP&E> 105,551,718
<DEPRECIATION> (45,543,896)
<TOTAL-ASSETS> 116,225,194
<CURRENT-LIABILITIES> 15,232,256
<BONDS> 20,925,659
<COMMON> 723,352
0
0
<OTHER-SE> 77,022,331
<TOTAL-LIABILITY-AND-EQUITY> 116,225,194
<SALES> 109,360,556
<TOTAL-REVENUES> 109,360,556
<CGS> 81,371,973
<TOTAL-COSTS> 102,428,327
<OTHER-EXPENSES> 1,343,919
<LOSS-PROVISION> 38,843
<INTEREST-EXPENSE> 1,457,217
<INCOME-PRETAX> 9,363,214
<INCOME-TAX> 2,430,985
<INCOME-CONTINUING> 6,932,229
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 6,932,229
<EPS-PRIMARY> 1.00
<EPS-DILUTED> 1.00
</TABLE>
