Oil-Dri Corp of America

Previous wording

Total SG&A increased $1.4 million, or 2% in fiscal year 2025 compared to fiscal year 2024. The increase was primarily driven by operating segment SG&A, which increased by $3.4 million, partially offset by a $2.0 million reduction in corporate unallocated expenses. SG&A expenses at the operating segments level are discussed below in the discussion of our segments' operating income. The decrease in corporate unallocated fiscal year 2025, was primarily due to a decrease in acquisition-related expenses compared to fiscal year 2024.

Current wording

Operating income remained relatively flat as the decrease in SG&A offset the decrease in gross profit. Total SG&A decreased $5.3 million, or 7% in fiscal year 2026 compared to fiscal year 2025. The decrease was driven by a $4.6 million reduction in corporate unallocated expenses and, to a lesser extent, by SG&A incurred by the operating segments. The decrease in corporate unallocated expenses in fiscal year 2026 as compared to fiscal year 2025 was primarily as a result of lower human resource costs attributed to corporate functions, lower incentive bonus and a reduction of outside services costs. SG&A expenses at the operating segments level are discussed below in the discussion of our segments' operating income.

Previous wording

Tax expense for fiscal year 2025 was $12.2 million with an effective tax rate of 18% compared to $10.2 million with an effective tax rate of 21% in fiscal year 2024. The increase in tax expense was driven by higher net income. Favorable return to provision adjustments for returns filed in 2025 drove a decrease in the 2025 effective tax rate. Tax credits and a change in timing of deductions drove the lower 2024 tax return rate. See Note 6 of the Notes to the Consolidated Financial Statements for additional information about our income taxes.

Current wording

Tax expense for fiscal year 2026 was $12.5 million compared to $12.2 million with an effective tax rate of 18% in both fiscal year 2026 and fiscal year 2025. Our effective tax rate is based on annual taxable income and our assessment of various tax adjustments, including depletion and discrete items. See Note 6 of the Notes to the Consolidated Financial Statements for additional information about our income taxes.

Previous wording

Consolidated net income for fiscal year 2025 was $54.0 million, or $3.70 per share of diluted Common Stock, compared to $39.4 million, or $2.72 per share of diluted Common Stock in fiscal year 2024. This increase was primarily due to the increase in net sales which more than offset the increase in operating expenses, interest expenses and income tax.

Current wording

Consolidated net income for fiscal year 2026 was $57.0 million, or $3.92 per share of diluted Common Stock, compared to $54.0 million, or $3.70 per share of diluted Common Stock in fiscal year 2025.

Previous wording

Our Consolidated Balance Sheets as of July 31, 2025, and our Consolidated Statements of Cash Flows for fiscal year 2025 show an increase in total cash and cash equivalents from fiscal year-end 2024. The increase is mainly due to cash flows from operating activities. Refer to the "Liquidity and Capital Resources" section below for additional information about our cash and cash equivalents.

Current wording

Our Consolidated Balance Sheets as of July 31, 2026, and our Consolidated Statements of Cash Flows for fiscal year 2026 show an increase of $23.2 million in total cash and cash equivalents from fiscal year-end 2025. The increase is mainly due to cash flows from operating activities. Refer to the "Liquidity and Capital Resources" section below for additional information about our cash and cash equivalents.

Previous wording

Net sales of the Business to Business Products Group for fiscal year 2025 were $182.6 million, an increase of $32.1 million, or 21%, from net sales of $150.5 million in fiscal year 2024, driven primarily by sales of our fluids purification products and, to a lesser extent, agricultural and animal health products. Net sales of fluids purification products increased $17.6 million or 19% in fiscal year 2025 compared with fiscal year 2024, driven primarily by the increase in demand for our products used in renewable diesel filtration. Net sales of our agricultural and horticultural chemical carrier products increased $10.8 million, or 32%, for fiscal year 2025 compared to fiscal year 2024 mainly as a result of stronger demand, primarily as key customers resumed purchasing after working through inventory surpluses. Net sales of our animal health and nutrition products increased $3.7 million, or 15%, in fiscal year 2025 compared to the fiscal year 2024, primarily due to higher sales volumes.

Current wording

Net sales of the Business to Business Products Group for fiscal year 2026 were $180.2 million, a decrease of $2.4 million, or 1%, from net sales of $182.6 million in fiscal year 2025, driven primarily by a reduction in sales of our fluids purification and animal health products and partially offset by an increase in sales of agricultural and horticultural products. Net sales of fluids purification products decreased $5.4 million or 5% in fiscal year 2026 compared with fiscal year 2025, driven primarily by the decrease in demand for our products used in renewable diesel filtration, which was significantly higher in fiscal year 2025 when several new customers began operations in new plants. Net sales of our animal health and nutrition products decreased $1.9 million, or 7%, in fiscal year 2026 compared to the fiscal year 2025, due to lower volume primarily driven by the temporary loss of a key customer at one of our distributors. Net sales of our agricultural and horticultural products increased $4.9 million, or 11%, for fiscal year 2026 compared to fiscal year 2025 mainly as a result of stronger demand from key customers.

Previous wording

Gross profit and operating income increased in fiscal year 2025 compared to fiscal year 2024, despite higher cost of goods sold and SG&A expenses. Cost of goods sold increased 16.9 million, or 19%, mainly due to per ton cost of goods sold which increased 5% in the fiscal year 2025 compared to fiscal year 2024. This increase was primarily due to higher transportation costs. SG&A expenses for the Business to Business Products Group increased $1.0 million, or 7%, for fiscal year 2025 compared to fiscal year 2024. The increase was mainly driven by higher research and development costs and a foreign value-added tax ("VAT") assessment, partially offset by cost reductions across other general and administrative expenses.

Current wording

Gross profit and operating income decreased in fiscal year 2026 compared to fiscal year 2025, due to lower net sales and higher cost of goods sold and SG&A. Cost of goods sold increased $1.9 million, or 2%, mainly due to per ton cost of goods sold which increased 4% in the fiscal year 2026 compared to fiscal year 2025. This increase was primarily due to higher per ton manufacturing costs, including materials, which increased 6%. SG&A expenses for the Business to Business Products Group increased $0.1 million, or 1%, for fiscal year 2026 compared to fiscal year 2025.

Previous wording

Net sales of the Retail and Wholesale Products Group for fiscal year 2025 were $303.0 million, an increase of $15.9 million, or 6%, from net sales of $287.1 million in fiscal year 2024, primarily driven by sales of our cat litter products. Domestic cat litter net sales, excluding co-packaged cat litter, were $225.9 million for fiscal year 2025, an increase of $13.1 million, or 6%, when compared to fiscal year 2024. Crystal cat litter sales represented $14.9 million of the increase, partially offset by a net decrease in clay-based litter. $3.7 million of the decrease was due to the loss of a private label account and $3.2 million due to customer bankruptcies. These losses were offset by other revenue gains within coarse and branded light-weight cat litter products due to new distribution with both existing and new customers. Net sales of co-packaged products increased by $0.9 million in fiscal year 2025 compared to fiscal year 2024, mainly due to higher prices. Net sales of our domestic industrial and sports products increased by $1.9 million, or 4%, compared to fiscal year 2024, primarily driven by higher pricing to offset elevated costs. Net sales by our subsidiary in Canada remained flat in fiscal year 2025 compared to fiscal year 2024.

Current wording

Net sales of the Retail and Wholesale Products Group for fiscal year 2026 were $313.6 million, an increase of $10.7 million, or 4%, from net sales of $303.0 million in fiscal year 2025, primarily driven by increased sales of our cat litter products. Net sales of co-packaged products increased 47% in fiscal year 2026 compared to fiscal year 2025, mainly due to higher volumes as we expanded our co-packaged offerings to include lightweight cat litter. Domestic cat litter net sales, excluding co-packaged cat litter, were $226.1 million for fiscal year 2026, which remained relatively flat when compared to fiscal year 2025. However, crystal cat litter sales increased $3.2 million due to higher volumes, while overall clay-based litter sales declined when compared to the prior fiscal year. The decrease in clay-based litter was driven by a $3.9 million decrease due to changes in private label distribution and a $1.7 million decrease related to the absence of non-recurring promotional activity from the prior year. These losses were partially offset by revenue gains with other customers. Net sales of our domestic industrial and sports products increased by $1.4 million, or 3%, compared to fiscal year 2025, primarily driven by higher pricing to offset increased costs including transportation costs. Net sales by our subsidiary in Canada increased $0.3 million in fiscal year 2026 compared to fiscal year 2025.

Previous wording

Foreign operations include our subsidiaries in Canada and the Netherlands, which are included in the Retail and Wholesale Products Group, and our subsidiaries in the United Kingdom, China, Mexico and Indonesia, which are included in the Business to Business Products Group. Net sales by our foreign subsidiaries during fiscal year 2025 were $20.1 million, a decrease of $0.9 million, or 4%, from net sales of $21.0 million during fiscal year 2024. The decrease in net sales was driven mainly by our subsidiary in China offset by increases in Mexico and the United Kingdom. Net sales of our subsidiary in China decreased $1.7 million, or 100%, during fiscal year 2025 compared to fiscal year 2024 primarily due to the sale of all existing inventory to a new master distributor in the first quarter of fiscal year 2024. Beginning in January 2023, sales to China went directly through Oil-Dri Corporation of America and not through our subsidiary in China. Net sales of our subsidiary in Mexico increased $0.5 million, or 27% during fiscal year 2025 compared to fiscal year 2024, due to higher volume. Net sales of our subsidiary in the United Kingdom in fiscal year 2025 increased by $0.4 million, or 13%, compared to net sales in fiscal year 2024, driven by higher prices. Total net sales of our subsidiary in Canada during fiscal year 2025 remained flat compared to fiscal year 2024. Net sales by our foreign subsidiaries represented 4% of our consolidated net sales in fiscal year 2025, and 5% of consolidated net sales in fiscal year 2024.

Current wording

Foreign operations include our subsidiaries in Canada and the Netherlands, which are included in the Retail and Wholesale Products Group, and our subsidiaries in the United Kingdom, China, Mexico and Indonesia, which are included in the Business to Business Products Group. Net sales by our foreign subsidiaries during fiscal year 2026 were $19.8 million, a decrease of $0.3 million, or 1%, from net sales of $20.1 million during fiscal year 2025. The decrease in net sales was driven mainly by our subsidiaries in Mexico and the United Kingdom, partially offset by an increase in Canada. Net sales of our subsidiary in Mexico decreased $0.4 million, or 20%, during fiscal year 2026 compared to fiscal year 2025 primarily due decreased sales volumes and lower prices. Net sales of our subsidiary in the United Kingdom decreased $0.1 million, or 3% during fiscal year 2026 compared to fiscal year 2025, due primarily to lower volume. Net sales of our subsidiary in Canada in fiscal year 2026 increased by $0.3 million, or 2%, compared to net sales in fiscal year 2025, driven by higher sales of lightweight litter. Net sales by our foreign subsidiaries represented 4% of our consolidated net sales in both fiscal year 2026 and fiscal year 2025.

Previous wording

For fiscal year 2025, our foreign subsidiaries reported a pre-tax net loss of $0.1 million, compared to $0.7 million of net income in fiscal year 2024. The decrease in net income was primarily driven by the foreign VAT assessment.

Current wording

For fiscal year 2026, our foreign subsidiaries reported a pre-tax net income of $0.1 million, compared to $0.1 million of pre-tax net loss in fiscal year 2025. The increase was primarily driven by the foreign VAT assessment recognized in fiscal year 2025.

Previous wording

Identifiable assets of our foreign subsidiaries as of July 31, 2025, were $9.0 million compared to $8.7 million as of July 31, 2024.

Current wording

Identifiable assets of our foreign subsidiaries as of July 31, 2026, were $1.1 million compared to $1.2 million as of July 31, 2025.

Previous wording

Our principal liquidity needs are to fund our capital requirements, including funding working capital needs; purchasing and upgrading equipment, facilities, information systems, and real estate; supporting new product development; investing in infrastructure; repurchasing stock; paying dividends; and, from time to time, business acquisitions and funding our debt service requirements. During fiscal year 2025, we principally funded these short and long-term capital requirements using cash from current operations as well as cash generated from previous borrowings under our Credit Agreement and the Series B, C and D Senior Notes issued under the Note Agreement. On September 30, 2024, we amended the Credit Agreement to, among other things, increase our line of credit from $45 million to $75 million, providing more financial flexibility. See Note 4 of the Notes to the Consolidated Financial Statements in this Annual Report on Form 10-K for further information relating to our existing borrowings.

Current wording

Our principal liquidity needs are to fund our capital requirements, including funding working capital needs; purchasing and upgrading equipment, facilities, information systems, and real estate; supporting new product development; investing in infrastructure; repurchasing stock; paying dividends; and, from time to time, business acquisitions and funding our debt service requirements. During fiscal year 2026, we principally funded these short and long-term capital requirements using cash from current operations as well as cash generated from previous borrowings under our Credit Agreement and the Series B, C and D Senior Notes issued under the Note Agreement. On October 7, 2026, we amended the Note Agreement to increase the aggregate principal amount of Shelf Notes from $75 million to $150 million and the Credit Agreement to increase our line of credit from $45 million to $75 million, among other things, providing more financial flexibility. See Note 4 of the Notes to the Consolidated Financial Statements in this Annual Report on Form 10-K for further information relating to our existing borrowings.

Previous wording

Cash and cash equivalents, including restricted cash, totaled $50.5 million and $24.5 million as of July 31, 2025, and 2024, respectively. The following table sets forth certain elements of our Consolidated Statements of Cash Flows for the fiscal year (in thousands):

Current wording

Cash and cash equivalents, including restricted cash, totaled $73.7 million and $50.5 million as of July 31, 2026, and 2025, respectively. The following table sets forth certain elements of our Consolidated Statements of Cash Flows for the fiscal year (in thousands):

Previous wording

Accounts receivables, less allowance for credit losses and cash discounts, were $7.8 million higher at fiscal year-end 2025 compared to fiscal year-end 2024. The variation in accounts receivable balances reflects differences in the level and timing of collections as well as the payment terms provided to various customers.

Current wording

Accounts receivables, less allowance for credit losses and cash discounts, were $5.8 million higher at fiscal year-end 2026 compared to fiscal year-end 2025. The increase in accounts receivable balances is primarily driven by the increase in net sales and timing of collections.

Previous wording

Excluding the impact of payments related to capital expenditures, accounts payable were $0.9 million higher at fiscal year-end 2025 compared to fiscal year-end 2024. The increase is due to higher trade payables mainly due to timing. Changes in trade accounts payable in all periods are subject to normal fluctuations in the timing of payments, the cost of goods and services we purchased, production volume levels and vendor payment terms. In fiscal year 2025, there was a $0.9 million increase in accounts payable related to capital expenditures which reduced the cash used in investing activities as compared to fiscal year 2024.

Current wording

compared to fiscal year-end 2025. Changes in trade accounts payable in all periods are subject to normal fluctuations in the timing of payments, the cost of goods and services we purchased, production volume levels and vendor payment terms. In fiscal year 2026, there was a $0.7 million decrease in accounts payable related to capital expenditures which increased the cash used in investing activities as compared to fiscal year 2025.

Previous wording

Excluding the impact of payments related to capital expenditures, accrued expenses were $2.4 million higher at fiscal year-end 2025 compared to fiscal year-end 2024. The increase in accrued expenses during fiscal year 2025 was driven by higher accrued payables, accrued taxes, and trade promotions and advertising accruals, which fluctuate due to timing, cost of goods and services, and payment terms. In fiscal year 2025, there was a $1.6 million decrease in accrued expenses related to capital expenditures recognized as cash used in investing activities as compared to the fiscal year 2024. See Note 10 of the Notes to the Consolidated Financial Statements for further information regarding our accrued expenses.

Current wording

Excluding the impact of payments related to capital expenditures, accrued expenses were $0.1 million lower at fiscal year-end 2026 compared to fiscal year-end 2025. In fiscal year 2026, there was a $0.5 million decrease in accrued expenses related to capital expenditures recognized as cash used in investing activities as compared to the fiscal year 2025. See Note 10 of the Notes to the Consolidated Financial Statements for further information regarding our accrued expenses.

Previous wording

Cash used in investing activities was $32.5 million in fiscal year 2025. Cash used in investing activities primarily related to capital expenditures to expand our plant equipment and improve our facilities in order to support increased demand for our products.

Current wording

Cash used in investing activities was $32.9 million in fiscal year 2026. Cash used in investing activities primarily related to capital expenditures to expand our plant equipment and improve our facilities in order to support increased demand for our products.

Previous wording

Cash used in financing activities was $21.7 million in fiscal year 2025, primarily driven by $11 million in payment of our debt, including the full repayment of the borrowings under the Credit Agreement, as well as $8.4 million used for dividend payments and $2.3 million used for share repurchases.

Current wording

Cash used in financing activities was $24.0 million in fiscal year 2026, primarily driven by $12.6 million used for share repurchases and $10.4 million used for dividend payments.

Previous wording

Total cash and investment balances held by our foreign subsidiaries were $4.7 million as of July 31, 2025, and $4.5 million as of July 31, 2024. See further discussion in the “Foreign Subsidiaries” section above.

Current wording

Total cash and investment balances held by our foreign subsidiaries were $5.1 million as of July 31, 2026, and $4.7 million as of July 31, 2025. See further discussion in the “Foreign Subsidiaries” section above.

Previous wording

As of July 31, 2025, we had remaining authority to repurchase 360,946 shares of Common Stock and 244,113 shares of Class B Stock under a repurchase plan approved by our Board. Repurchases may be made on the open market (pursuant to Rule 10b5-1 plans or otherwise) or in negotiated transactions. The timing and number of shares repurchased will be determined by our management pursuant to the repurchase plan approved by our Board. In fiscal years 2025 and 2024, we made repurchases of stock as further discussed in Item 5 "Market for Registrant's Common Equity, Related Stockholders Matters and Issuer Purchases of Equity Securities."

Current wording

As of July 31, 2026, we had remaining authority to repurchase 171,909 shares of Common Stock and 208,197 shares of Class B Stock under a repurchase plan approved by our Board. Repurchases may be made on the open market (pursuant to Rule 10b5-1 plans or otherwise) or in negotiated transactions. The timing and number of shares repurchased will be determined by our management pursuant to the repurchase plan approved by our Board. In fiscal years 2026 and 2025, we made repurchases of stock as further discussed in Item 5 "Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities."

Previous wording

We recorded valuation allowances of $2.8 million and $2.5 million for the amount of the deferred tax benefit related to our foreign net operating loss carryforwards and certain state net operating loss carryforwards as of July 31, 2025 and 2024, respectively, because we believe it is unlikely we will realize the benefit of these tax attributes in the future.

Current wording

We recorded valuation allowances of $2.4 million and $2.8 million for the amount of the deferred tax benefit related to our foreign net operating loss carryforwards and certain state net operating loss carryforwards as of July 31, 2026 and 2025, respectively, because we believe it is unlikely we will realize the benefit of these tax attributes in the future.

Previous wording

Trade Promotions. We routinely commit to one-time or ongoing trade promotion programs in our Retail and Wholesale Products Group. Promotional reserves are provided for sales incentives made directly to consumers, such as coupons, and sales incentives made to customers, such as slotting, discounts based on sales volume, cooperative marketing programs and other arrangements. All such trade promotion costs are netted against sales. Promotional reserves are established based on our best estimate of the amounts necessary to settle future and existing claims on products sold as of the balance sheet date. To estimate trade promotion reserves, we rely on our historical experience of trade spending patterns and that of the industry, current trends and forecasted data. While we believe our promotional reserves are reasonable and that appropriate judgments have been made, estimated amounts could differ from future obligations. We have accrued liabilities at the end of each period for the estimated trade spending programs. We recorded liabilities of approximately $3.1 million and $2.7 million for trade promotions as of July 31, 2025, and 2024, respectively.

Current wording

Trade Promotions. We routinely commit to one-time or ongoing trade promotion programs in our Retail and Wholesale Products Group. Promotional reserves are provided for sales incentives made directly to consumers, such as coupons, and sales incentives made to customers, such as slotting, discounts based on sales volume, cooperative marketing programs and other arrangements. All such trade promotion costs are netted against sales. Promotional reserves are established based on our best estimate of the amounts necessary to settle future and existing claims on products sold as of the balance sheet date. To estimate trade promotion reserves, we rely on our historical experience of trade spending patterns and that of the industry, current trends and forecasted data. While we believe our promotional reserves are reasonable and that appropriate judgments have been made, estimated amounts could differ from future obligations. We have accrued liabilities at the end of each period for the estimated trade spending programs. We recorded liabilities of approximately $3.3 million and $3.1 million for trade promotions as of July 31, 2026, and 2025, respectively.

Previous wording

Reclamation. During the normal course of our mining process, we remove overburden and perform on-going reclamation activities. As overburden is removed from a mine site, it is hauled to a previously mined site and used to refill older sites. This process allows us to continuously reclaim older mine sites and dispose of overburden simultaneously, therefore minimizing the costs associated with the reclamation process. On an annual basis we evaluate our potential reclamation liability in accordance with ASC 410, Asset Retirement and Environmental Obligations. We have recorded an estimated net reclamation asset of $3.1 million as of July 31, 2025, and $2.2 million, as of July 31, 2024, and a corresponding estimated reclamation liability of $5.9 million as of July 31, 2025, and $4.8 million as of July 31, 2024. These values represent the discounted present value of the estimated future mining reclamation and landfill closure and monitoring costs at the production plants. The reclamation assets are depreciated over the estimated useful lives of the various mines. The reclamation liabilities are increased based on a yearly accretion charge over the estimated useful lives of the mines.

Current wording

Reclamation. During the normal course of our mining process, we remove overburden and perform on-going reclamation activities. As overburden is removed from a mine site, it is hauled to a previously mined site and used to refill older sites. This process allows us to continuously reclaim older mine sites and dispose of overburden simultaneously, therefore minimizing the costs associated with the reclamation process. On an annual basis we evaluate our potential reclamation liability in accordance with ASC 410, Asset Retirement and Environmental Obligations. Reclamation assets are depreciated over the estimated useful lives of the various mines. Reclamation liabilities are increased based on a yearly accretion charge over the estimated useful lives of the mines. We have recorded an estimated net reclamation asset of $3.0 million as of July 31, 2026, and $3.1 million, as of July 31, 2025, and a corresponding estimated reclamation liability of $5.8 million as of July 31, 2026, and $5.9 million as of July 31, 2025. These values represent the discounted present value of the estimated future mining reclamation and landfill closure and monitoring costs at the production plants. In fiscal year 2026 we released a portion of our asset retirement obligation based on our annual evaluation of the future costs, resulting in a net decrease of the liability.