Oil-Dri Cites Price Inflation in Fourth Quarter Income – Commodity Commentary

By Mary de Moist

Oil-Dri Company of America stated increased costs for resin, lumber and pure gasoline took a toll on its fourth quarter outcomes.

In its fourth trimester:

“Our efficiency within the fourth quarter and in fiscal 2021 was disappointing regardless of important income progress with report consolidated internet gross sales for each intervals,” stated President and CEO Daniel S Jaffee.

“Our profitability has been drastically decreased as a result of important value inflation throughout all enter channels. Not solely has the value of resin utilized in our jugs and buckets elevated, however the increased prices of lumber for pallets have additionally contributed to the dramatic enhance in our total packaging bills, ”says Mr. Jaffee. .

“Dramatic will increase within the prices of freight, pure gasoline and different supplies have additionally negatively impacted our margins. In response to those rising prices, we’ve carried out value will increase throughout our portfolio. Nevertheless, it’s clear that we’ve not saved up with the speedy tempo of inflation.

“As well as, our provide chain has been challenged by capability constraints in trucking and ocean carriers mixed with a nationwide labor scarcity.”

The producer and provider of specialty absorbent merchandise stated internet gross sales reached an all-time excessive quarterly excessive of $ 78 million, up 20% from the comparable quarter a yr in the past.

“Gross sales from our cat litter, industrial, athletic and agricultural companies had been answerable for most of this progress. Demand for co-packaged coarse cat litter and fluid purification merchandise additionally elevated within the fourth quarter from a yr in the past, whereas income from and dietary merchandise was largely flat, ”the corporate stated.

“Though revenues elevated considerably throughout the quarter, these good points had been offset by a 7% enhance within the home value of products bought per tonne manufactured from the prior yr. Trucking capability constraints and excessive gas prices resulted in a 7% enhance in home freight per tonne manufactured in comparison with the identical interval final yr.

“Because of excessive resin and lumber value inflation, home packaging prices per tonne manufactured have elevated by 40%. The margin discount was additional contributed to the rise in home pure gasoline per tonne manufactured, which rose 67% within the fourth quarter from a yr earlier. “

Write to Mary de Moist at [email protected]

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