Oil-Dri of America(ODC) - 2025 Q2 - Quarterly Results

Financial Performance - Consolidated net sales for Q2 FY2025 reached $116.9 million, an 11% increase from $105.7 million in Q2 FY2024, driven by 7% organic growth and a 4% contribution from the acquisition of Ultra Pet Company[7] - Operating income rose to $17.5 million, a 15% increase compared to $15.2 million in the same period last year, supported by improved product mix and higher prices[10] - Net income for Q2 FY2025 was $12.9 million, reflecting a 4% increase from $12.4 million in Q2 FY2024, while EBITDA grew 16% to $22.2 million[13] - Gross profit for Q2 FY2025 was $34.4 million, an 11% increase, with gross margins at 29.5%, marking the tenth consecutive quarter of year-over-year margin expansion[8] - Operating income for the first six months of 2025 was $38,672,000, representing a 36.5% increase from $28,321,000 in the first six months of 2024[31] - Net income for the six months ended January 31, 2025, was $29,297,000, up 26.7% from $23,124,000 in the same period of 2024[33] - EBITDA for the second quarter of 2025 was $22,216,000, compared to $19,233,000 in Q2 2024, indicating a growth of 15.4%[34] - The company’s basic common net income per share increased to $2.17 for the six months ended January 31, 2025, from $1.72 in the same period of 2024[31] Revenue Breakdown - The Business to Business (B2B) Products Group reported revenues of $43.4 million, a 20% increase year-over-year, with fluids purification sales reaching $26.5 million, up 17%[15] - The Retail and Wholesale (R&W) Products Group's revenues increased to $73.5 million, a 6% rise, with $4.4 million contributed from the Ultra Pet acquisition[18] - Net sales for the second quarter ended January 31, 2025, increased to $116,914,000, a 10.4% rise from $105,668,000 in the same period of 2024[30] Expenses and Liabilities - Selling, general and administrative expenses (SG&A) increased by 8% to $17.0 million, reflecting higher compensation and strategic investments in data analytics[9] - The company reported a decrease in total liabilities from $77,340,000 as of July 31, 2024, to $65,697,000 as of January 31, 2025[32] Cash Flow and Investments - Cash and cash equivalents decreased to $22,589,000 as of January 31, 2025, from $27,800,000 at the end of the previous year[33] - The company paid down $5.0 million of its revolving credit facility used for the Ultra Pet acquisition, maintaining a focus on debt reduction and infrastructure investment[14] - The company paid dividends totaling $4,194,000 during the six months ended January 31, 2025, compared to $3,889,000 in the same period of 2024[33] Strategic Outlook - The company aims to continue driving sustainable growth while executing its strategic vision with discipline and efficiency in the second half of FY2025[6] - The effective tax rate increased to 20.5% in Q2 FY2025 from 15.7% in Q2 FY2024, due to higher pre-tax income[12] Other Financial Metrics - Total current assets rose slightly to $149,016,000 as of January 31, 2025, compared to $147,158,000 as of July 31, 2024[32] - Gross profit margin improved to 29.5% in Q2 2025, compared to 29.3% in Q2 2024, with gross profit reaching $34,448,000[30]