Oil-Dri Corporation of America reports record sales

by Nicole Duarte

published by the Medill News Service, February 23, 2006

Oil-Dri Corporation of America, a Chicago-based sorbent minerals manufacturer, posted record sales although high energy costs resulted in a 13 percent decrease in second-quarter earnings.

The company reported income of $1.87 million or 32 cents per diluted share, compared with $2.15 million or 36 cents per diluted share.

Sales for the quarter ended Jan. 31, 2006 totaled $53.96 million, a 9 percent increase from $49.48 million in the year-prior quarter.

No analysts cover the company.

"We are quite pleased with our second-quarter results as they reflect an improving trend in our overall business. Quarterly results demonstrate the company's progress in rebuilding our profit margins after the unprecedented increase in energy and other costs following hurricanes Katrina and Rita," said Oil-Dri CEO and President Dan Jaffee.

Oil-Dri makes and markets mineral products for the pet care, agricultural, industrial and automotive, and fluids purification markets.

"We have been able to raise prices to help offset some of the energy cost increases, which have now leveled off but are nearly double since last year. Additional price increases are scheduled in the second half of the year, which should further improve our profit margins," Jaffee said in a statement.

Earnings for the six months ended Jan. 31 were $2.9 million or 50 cents per diluted share, compared with $3.43 million or 57 cents per diluted share in the prior-year period.

Revenue for the six months topped $101.75 million, up from $93.6 million in the prior-year period.

In a conference call, the company said additional energy costs incurred after the hurricanes resulted in a 54 cents per share hit to earnings in the first six months of the year.

The stock closed at $18.93, up 42 cents or 2.3 percent