Oil-Dri Corporation of America (ODC) 14 Oct 222022 Q4 Earnings call transcript

Hello everyone. Welcome to Oil-Dri’s Fourth Quarter and Fiscal 2022 Year-End Teleconference.

We are doing this virtually, so I want to introduce the group to you. Susan Kreh is on hand today. She’s our CFO. VP of Jessica Lamson, Manager Manager President Moskowitz, Products not Wade Leslie President Retail VP of least of Vice Amlin the Controller Division, Wholesale, & Investor and General of and VP Robey, Atkinson, Strategic Christiansen, Partnerships Operations, Scheland, our Counsel, Group Chris Relations. of Consumer Marketing, and Aaron Laura Agriculture David Vice VP of Garber, and but General last Safe you Harbor. if walk would through our Leslie, And us

Thank everyone. the may performance materially results Welcome we press you forward-looking in contain a affect of consider important you filings, periods Dan? in SEC our stock. our review that those highlight for Actual comments Dan. release number factors We those call, evaluating today's On our Oil-Dri and periods. us. statements risk may Company's Company's regarding In and in you ask in any differ. factors, performance. trends comments may Thank evaluating joining that future the in in and investment and uncertainties future

got profitability on pandemic, at return us not go, prices, but going we enough and and the we We you. I to it. in inflation, long say financial the a still to we our turn earnings. that's a given need to for highlights Susan the to the good else world, finally of the good war, way strong supply quarter. high with have review I’d before thank a chain to – seeing just good where like quarter, everything disruption, least be, And you’re were it to happy over Yes, a felt they delivered We of that

under making points, going our we XX gross points or quarter. points, the just we profit XX XX As XX four only years, back, made Well, I in see trend five points? were

it was. made. business me, need our invest more teammates, still And you not because but So our interest, our we a capital where clearly everyone's rapidly. see our in get back have is not the the to we really capital, we growth good income we have best expenditure the are requires only to health but financial business, feel segment almost just Trust and well, our growing about done, also shareholders plants. continue every to customers, greater not can working we And focus to to on that it's in

the cautiously a done we're progress. to we're of recognize carry of sort optimistic happy we've of clearly as But fiscal XXXX. long into So that yet. the winded not way made momentum over is that hopeful, what a release, we very first mentioned in will And say I quarter lot the off

So will Susan I it results. financial to for our turn over

Thanks, Dan.

out we a You'll put release. pretty detailed note that press

comments to my really So I'm your and to for prior more feedback, of responding going keep time in brief Q&A. leave some

the that were we and started see and As seeing into quarter exited the during quarter, third we first. we we the talking fourth that about to momentum in continued

just of You'll XX% year-over-year, momentum that XX% on was a XX% it line And was idea, dive of volume. about about on little million, volume, revenue on and continued. talk little I was XX%, segment our on balanced, that more the XX% the on XX% volume. results XX% price, that If it retail by fourth BXB a the to whereas other so quarter we in growth the in an if revenue bit wholesale quarter into based their fourth based note pricing during you bit pricing, give $XX was or of

on up but So we restoring direction. our the XX.X%, to the to moving pre continue right we the continued And quarter, achieve levels, below to pandemic in momentum improved profit fourth during with focus back definitely gross moving those still margins. that

cover to transportation, inflation increases many We on the and areas. and others labor materials are to energy, other fronts, seek experiencing in even we price like raw multiple continue

key highlights subsequent in kind event. momentum note of we knew a was are those in So don't the the there about focus there on, a

to announced that on defined at prior are Note your that we financial are many statements. to funded. contained is plan. recent pension There plan our plan essentially terminating actuarial most the end, basically, level, So our X value we details high a fully in But benefit indicates our our

company, move and a to mode We've So shifted down, as hit assets most that actually don't liabilities that losses. most we're there'll settle be sure material able make on we draws wind that be those we trying market to terminate, expect as pension get pay presentation that of with pension. that assets are to we the no to cash in we'll equity into of our with this the

We will XX And going what's on. be highlight to expect next the Dan, within a that so pass I'll just this back it terminated on there you. months, little that, with

And advance. Appreciate Susan. you in sort it. who answers. allowed to you, our questions got It's prepare us them and through those of Thank appreciate Great.

also the can and field after click the if webcast You select, using submit. submit want question on you questions

So is Leslie, what our first question?

for changed? question Okay, Are able to And currently take you to If number? Bob Performance XXXX [Indiscernible] from Center from his for one? question Dan, reaffirm you for last budgeting is, want has Amlin. million what in the do Investing. $XX that comes our referenced fiscal that call, you not, revenues during first

I Yes, mode, much Even hit startup great miss. it's last it or very a question. And and look, was quarter, said, as

the cautiously two still for That's fiscal only fiscal number are into year. We months We're the our year. optimistic.

We have business. trials, lot of a repeat we have

either. the not blow not I'm So we're through that's number to going I'm I But the number. would change anything seeing saying say to ready

of positive. don't cautiously you, still going optimistic. results got know bunch if but are helps a trials we're We've and initial that So the on, Bob, I very

I So that's how about feel that.

there costs, of overall Advisors. next question John in quarters? seeing as and or that Wealth a material congrats from says packaging you a the great. comes his there's done. second answer been The Kreh raw quarter bottlenecks? the and from Has of So second such meaningful buybacks Bair next on And Susan to relief is part few Aaron's will shipping that our and and improvement revenues. Operations VP the what was, that, after over margins Aaron solid take part help any resins share Okay, but in logistics Ascend Christiansen, Are record improve may of status will any question. He flattening

John, we thank of thanks your And quarter acknowledgement question. for the for you had. the

and key which drivers your cost we area gas natural in even of of of seeing input areas element the compression, question, signs costs, of first us. in some flattening a similar The notably packaging utilities, for of mild of our costs, are are and diesel, number

your about and more to we continue and two improved parts. international the to anticipated area has and year. have different freight has that is extraordinarily cost absolutely place we story. and Domestic fantastic was Export a freight Domestic cost, become the a unavailable, available That's be much see in in to pandemic. really compression. seen question to expectation hope it's readily need freight So and be mild Export continues of to to up far and flattening, unique more throughout it freight of absolutely Oil-Dri. there's To availability. pre as not I availability expensive split freight some my into continue answer

on ways end. we equipment's ship can available, adapt other same when to more be trying ensure carry in the we to and are ready the and the local overcome freight to We where domestic

So I has hope been feedback my beneficial.

Thanks, of is part second jump Susan. in the that's Aaron. our order ones. share on on And question I'll In lower of this one of the repurchases. priorities, the cash

to up some growth and longer. fund business our working capital. fund support as opportunities to of other Amlin for commitment is those capital little for longer some a order initiatives. our these we And see foreign you our fund to spending, priority And that ratcheting of those. first capital can And and Our more some of opportunities. year-over-year Aaron our And to bit in mentioned requires are growth we'll growth some and the support fund have businesses, working logistics probably to

of all taken those come fund share We priorities and repurchases. of dividend our after are also care then

don't plan have do any So I'd this something any to in but time, we on point always that's basis. say at just on-going evaluate an we

The there Lamson, brands, expensive or demand The your trace next causing that investigator. higher great. for reflecting question from factors more comes private Starr noted a a you. consumers reduced what please? because is spending litter for [ph] are for Okay, cat answer need that XX-K Chris was pride Thank demand? switching other Ethan higher will cats to you the

Yes. for the Ethan. Good morning, Thanks question.

function noted we especially everybody what the reduction in The yes, to has year-over-year. unique to litter, else was We and Strong both but more were XX-K against. is our the we business the that strong, up our in strong not lightweight up of malaise of strategic segments demand across continued. demand trade the really supply So were against include chain us, right. was demand also certainly that

results, course, bit elasticity in of volume a see a the been amount As little you has pricing little the showing of bit, by of time. category marketplace, the tempered

in to starting the as So we're are good candidly, way in across as competition do we see drives about trade, that, our to us. going that rational reinvest for well. think forward, And a and we pay we able it that as out

has the we a into Aaron category, So his litter when lifted as we and fully can us, job fantastic the getting in trade the Nielsen, the have back and position we demand done for other specifically look into promotion, same, see back players where is getting can malaise we into meet cat business. a promote team doing the and us supply

you. The Bob from Thank next Smith. Great. question comes

[Indiscernible]. to relates Amlin, As it that fiscal the will ‘XX be feel

was question. rough, know, really audio Leslie, I'll the You your read

true leading accelerated As feel do percentage-wise. terms, it be point not to you will if F absolute the in relates growth continued to ‘XX that Amlin, inflection

to very, a I health embellish don’t guess, do, have XX,XXX and look markets can when very, around key wait, great non-antibiotic animals. solution that of best still gut our of my for comments. the we We you mean, I'd are bullish. what we I think have outreach products to believe love fit. sort But natural they And on and very we I

Wade, you So of don’t that? why handle some

thank the Absolutely. question. Thank you, absolutely. And Yes, Dan. for you

in the animal means have see Dan to in things year, need around going the said, You been over see look over by that keep pace. the last and the the people. growth continued of of we that spite the by a we industries on production protein, that other consumption folks world, As pandemic, And as obviously

for products first pursue kind markets, of targets a Our positioned well of we and swine industry are interest. the industry, only not those as very poultry

into sell We aqua also as and dairy well. into

products those have important we that a roll for as of This can will industries. us internationally. we serve can our So year all as broad that spectrum out be portfolio very

we're And know, largest obviously from one species. is the in positive we've which and launched they seeing as well, uptake number our receptivity the trial as you U.S. in great world, of great the customers in also of As see a a portfolio markets those results.

preservation So remove in we're Amlin, like market about for other only replacement large of markets the grain and micro preventing natural antibiotic antibiotics, and a the world the more more the toxicosis, and regions seek traditional also prospects, is but solutions. more customers as of growth or to an excited very more pharmaceuticals, opportunity not drugs, pursue

as opportunity So about the Amlin for itself a whole. we're bullish and for very the industry

Wade this culling within the publicized. Hey are specific the Or situation in year has been are read outbreaks that uptake stay on had widely geographically flocks sales U.S. poultry not this Has situation of market the widespread the a this U.S. got helped John to as questions so We’ve great. has From large line. products flocks resulted as those re-established? impact or slowing Avian of on conversely, Amlin Amlin flocks, I'm some but re-established? Flu Bear, numbers has the of going in negative

tend year outbreaks you, Yes, happens. have one this part specifically publicized as years you. or Yes, of influenza, is we we it's It's been that past few is Thank not infrequent have thank reason Every thing and Avian John. this two. the is here. HXNX not which an severe of common its widely the that to very

situations directly in can impacted really you of United farms States sorts to the not little here with that occurring, does as travel. influenza, about know. quarantines that are birds million thing our happens, We impacted you when and there's some depopulation cause difficulty exist. As but sales travel the in It's you then to repopulation do only it over limit customers. had We, these is when and we've know, XX Avian

has believe has our And bit it so that really don't It challenging, the little penetrate a doesn't our more made increase market. I opportunity, ability impeded significantly either. but to

are for products or really Our around the not designed treatment Avian mitigation influenza.

herds. and frankly, repopulation ability, their the their to our repopulate rapid, the United drive have But regions of way. doesn't strong quick in world other flocks, that it very is So growth States very ability very the

And depopulation so occurs. happen that we're as the seeing

going is some hopefully stable, we're the pretty actually in market growth So U.S. coming see to year. the in

hasn't a really in our business So no, it impacted negative way.

you Wade. same couple all aiming thing. We've of Great, sort thank questions of a at got the

So synthesize it have business. States when what and recession if the just a I'll United them, impact comes what on in your

As know, high the focused domestically States. that, very the business high on in little of United but you we're occurs a ish I'm in XX% it's XXs. our Maybe in the definitely

And so pets, proof, the have primarily is recessions are past news which fairly past. the food, are We've but all recession navigated good as on and our very products renewables, been that they focused well. in

people are try for to our save a make the segment, people largest mistake. you on just the the pet side, If bifurcates; which who brands on is they're trade you zero priced; OPP, to they down because the business, actually But go are afraid them really where premiumization, value get opening are lot market popularly money. of a are. price get a to And then going point and the our you in who the super

trade like existence weighted retailers We of benefit. a who United our with have that to and then definitely private focus business and whole of really our as stores the litter. lately, label accrue litters, so But Walmart, And lightweight towards large leaning advent only and cat and will the the we dollar private Canada. lightweight into And on have forth. label people share value been States are we heavily in heavily absolutely the down,

negative So feel of could business, recession. create opportunities. on are unmindful we real impact we some and to it not But our that possibly say a additional possible have even don't would a

that And that. questions. covers good So

one. because number manner for years. numbers figure right, we've Let's Amlin we've by go of I'm the we'll got just total about, All looking capture than -- market, a addressable the realistic for that you the might get way, give and covering a that bunch a the TAM this and see pick market comfortable of narrow, what in be to can at you and share bandied relating you questions that to with about a a the one? few narrow more how looking TAM got more Wade, have are been to broad feel next me will

absolutely. Yes,

to levels dollar world. has world in market preservation, animal So opportunities which when are, we it's talked kind with business, grain based health are and clear minerals. very broad look about market the market that be well the various technology a opportunity nutrition in that There very and Amlin the in tried we've like opportunity area different But the in cloud core of of the is That's as we pursued over that large across the our areas. billion opportunity. at there a

obviously in storage. the focus in or we front Now crops we don't, end on don't field the

ability removed there space have a preserve a market to we've can about come pharmaceuticals, feeds the most as target and our the recently billion, antibiotics can X that's that formulated in to product animal in anticoccidial or there then our whether the neutral X we are utilized But billion now a very market. in That's be antibiotics people own segment the whether path very look the of again been or product has antibiotics When are bit fairly even products. down enormous [Indiscernible] quality It's is an that's feed. world. still it's at a products of we or of that's that launched new replacement really removal the significant other our closer products that around bandied it market Our but that large cereals here a target. and flow

that? a Europe. Latin multibillion No, we Asia. in there's of focusing the Are not opportunity world United now, dollar now. States, in areas So pursuing like we're Right America, all we're

us, not but that is dollar still of multibillion to a So some available opportunity. it's

there's space. players look we lot share, a in market this of As at

business in So and that that, additions Amlin at we take more Oil-Dri. we markets, look a larger headspace, obviously, will a, would can grow our on for of company We substantial our a but share other some for of portfolio XX% and But portfolio, huge market to if the be we're lot of a and grow broader that opportunity time, efficacy conservatively the for not these than today. participation products. focusing X%, as we in demonstrate hope our

more, we question and I to Great, ask part have the going Chris Ethan's covered. I, of for one thank you you. already Lamson. I'm just then second one Wade.

conventions, was interest its participation drive is part of industry recent awareness shows, how in product. but Amlin’s first The helped and trade in primarily

thank tremendous this receptivity the and question, you to appreciate point. for Yes, Ethan. that, Dan, We've had

all our Recently, year. last great exposition last with, it’s Expo great portfolio You are showing familiar at Dairy part products another the we World were that. in did coming International our Wisconsin, we targeting. industry poultry We week the had what and Madison, a of out of we're with in sector interest in

On the the much than grow think I interviews we dairy lot engagement of we dairy We're side, again, a with a even did, tremendous opportunity dozen seeing faster with our media, market expected. customers. interest

support species the it's our just So for portfolio. demonstrating across

look a International we which give prominent March, Bangkok in really VIV a be in then exposition year. the in worldwide at again coming what us. future, we And Atlanta. a having poultry out in really into in at us do As That's global we'll and show January IPPE will show Asia the again, the for supplement impact in

marketing job the great Amlin. team of and brand by our awareness raising really So

Great, you. thank

you around lightweight Canada basically can site, can using which share a And the Jessica, is add, thing, it know to take United private there. the States? questions of A some a high I'll question. it. how we do And consumer add as of couple label up same to can we what kind you in grow the Here's beta maybe it’s color first. Chris, you'll

So can on maybe do to what's share what just and in is we the help bit to things then the U.S., gap. talk in about going a close Canada, and little then the what

we being a Thanks, Canadian view in of significantly share Dan. lightweight that of to market opportunity our share over significant to a within things We XX% Dan's close Yes, so the as has case in great taken share the and really lightweight overall to that able XX%. we've continues U.S. of market. of Canada is where gain study where, gap and to to terms the closer a overall market, the couple The do point. seen

as Dan to were that if a quality who the switch to given say, in price to want of value point to having price cat like upstairs. key from As equal, and home wouldn't wouldn't to lift of as jug heavy were cat and well lightweight switch litter consumer your in what pain equal just your if were, store and to lightweight litter

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to litter consumers improve that overall not see quality price so into to the increase a more value huge to and but also continue we bring So improve that lightweight we penetration can to continue even franchise. only the cat opportunity of relationship

add? to anything Chris Fantastic.

a I'd think names. a maybe Jess, add bit tactically name and part answer I only little won't more and Jess. thing I great the near in it’s And

per their was label We had lightweight, that higher a have where study label, than retailer perspective pricing case private we their from recently private heavyweight. use a a

take economic stronger a lightweight fantastic product that the team truck. customer you fact did so on more you account significantly job showing sales analytically into the when the get were can much a Our that

their So And, best on there grown aligned business we into they've has basis. story the could. lightweight kind that and faster them use a as and showed there, financials behold, price ever. them And, than lightweight we business crawled of label, private as per lo now

shelf, talked we She think, and to I value value, is referred to product, don't influences. value, looking control case example right? that comes I study And what that all there's think. down about to So price Jessica a we're that on it good the

converted United I back to and be about water they when reduce off were of whole towards look, is about heavyweight in the it know you're they the detergent then good. I love clearly months else stay for all or here the footprint footprint their basically actually somebody it's thing for trend the to would we're specific the reduce going add, able get you going here saw I've Yes, going Say before if eat took stay. to both Northwest. this. not And we're excuse And to and reformulate, working, XX%, way, lucky have past, the said can you huge. And in in sometimes retailers And which this if you And carbon we're that is great. They to by And concentrated global convert, comes same the this with the was growing, And States behind the jumped Walmart Walmart once the There's genie shelves. and two concentrate, lightweight. to idea of it liquid out better to our or to And all gave forced shipping only shipping because to said I they no either XX the the then over just of referenced be to the trend, by And house. thirds. us because in and that weight. it's in they on ESG going the would lightweight, that States one that's bottle. and water so than water switch the what which using is consumers formula the carbon by out the plenty the all have place lightweight. United weren't

pretty and Southeast, So east much. you're Northeast, talking litter, about sodium the markets there's primary bentonite, the Wyoming no of for the cat

I probably think if you you in a footprint than XX% reduction. strategically freight, And located. get the greater so even plants would carbon And our are factored

for lightweight. of for also consumer, very for also we're bullish it's the also good good a believe So It's good perfect good anyway, on environment. for the it's It's retailer. We Oil-Dri. what's and alignment the

So I at this able And focused. everybody everybody I time. questions, to of more format, will do we for wins. We're thank back you the first want more be we're quarter out like answer to stay of fiscal ‘XX. keep we much. fingers Year. And in that carries you over Take the fourth showed Thank momentum our the into you Be let's care. crossed all the New quarter safe. very toes and