By Mays C G
Oil-Dri Corporation (ODC) reported solid first quarter earnings, increase in net sales by 5% to 56.3 million (see the transcript of the Conference here call). Net income increased by 17% to 2.5 million, or $0.35 per share diluted, compared with a net profit of 2.2 million or $0.30 per share a year ago.
Oil-Dri Canada President clearly proud of the quarter, the company CEO & Dan Jaffee, and maybe feel a little beside him, decided to make South speech skills a week before the annual meeting, conference call listeners and participants. He spoke of making Oil - Dri companies with a long-term orientation and who want investors see the company in the same perspective. He then used his screening inventory Charles Schwab to illustrate that, in terms of total return OIL - Dri, companies stock performance was more than double the stock of Berkshire Hathaway (BRK.A) and has outperformed Microsoft (MSFT) stock by 14 times in the past five years. (And then his ego separated from the head exploded and stopped calling while someone has introduced some clay in room to clean.)
DOING BUSINESS
Industry products business group's net sales increased by 2.27 million or 14% to 19.05 million. Net sales of agricultural chemicals has increased from 59% to 49% sold tons. This is in line with the increase in commodity prices of wheat, corn, soybean, etc.. Net sales for the purification of fluids has increased from 19% to 17% sold tons. These gains offset by was a decrease in sales of products of animal health by 12%, which was mainly attributable to the loss of a customer. Private label cat liter net sales decreased by 1% due to an overall decrease in overall demand.
Sale at retail and wholesale Products Group had net sales, which rose from $corresponding to 2% of $ 37.2 million. Net sales of litre of brand cat has increased 12% to 6% sold tons. Wal-Mart (WMT) has much to do with the resurgence of brand Cat litre category. Sales at Wal-Mart are higher than last year, but below the level they were at before that Wal-Mart reduces the number of stores sold brand Cat liter. Industrial absorbents net sales increased by 4% due to increased demand from industrial distributors.
Internationally, profits were not so easy to absorb. Net sales by foreign subsidiaries declined sizable 20%, from 7% to 5% of total sales. The subsidiaries are located in the Canada and the United Kingdom. The Canadian subsidiary net sales were down 15% and the United Kingdom sales were down 38%. The loss of a customer in the animal health and nutrition products group has been a key to decline reason the Canada retail weakness in industrial markets while and £: exchange rate $ have been the culprit in the United Kingdom.
On the side of cost accounting, have increased by 23% because of higher sales of merchandise exports and diesel fuel costs. Costs of SG & A were higher in both segments with an 8% increase in operating business group and 3% in Group wholesale and retail. Higher in the Group business costs were due to increased marketing costs used to promote animal health and nutrition products likely to replace the client was lost. It was important to any client whose loss translates into a decline of double-digit sales growth. Higher in the Group wholesale and retail costs was mainly due to market research. Packing costs increased due to the increase in costs of paper and resin retail segments and business.
Overall, it was a solid quarter for Oil - Dri Corporation. I expect fluid purification and sales remain strong as agricultural products remain at or near record, automotive industry continues its ascent and demand of fuel industrial absorbent products, agricultural chemicals and products tanker base remains stable. I'm also looking forward to win more sales of animal nutrition and health when they introduce the next generation of clay based products. They can earn same customer return lost.
This exchanged very thin stock closed at a recent price of $21.19, which is less than the $21.98 rated when I discussed the stock about a month ago. The stock is even more value to these levels. For the moment, I am now my price target to $26 per share. Finally, OIL - Dri provides a review of their products by Wal-Mart in the period of March. If they decide to return brand pride in cat cat litre more stores Wal - Mart Oil - Dri could absorb even more profits.
Disclosure:I am long ODC. Neither the author of this article or any members of the family actions specific to Wal - Mart (WMT) this editorial. For full disclosure of my policy on written or recommended stocks property, see the Mays report page.
GC mays, equity analyst and editor of The Mays is an independent trader with equity exchanges of experience. With a background in accounting, finance and information technology, it is the driving force behind the collection of data, financial statement analysis and modeling... More
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