Item 1. Financial Statements
ITEM 1. Financial Statements
OIL-DRI CORPORATION OF AMERICA
Condensed Consolidated Balance Sheet
(in thousands, except for share and per share amounts, unaudited)
ASSETS April 30,
2026 July 31,
2025
Current Assets
Cash and cash equivalents $ 62,941 $ 50,458
Accounts receivable, net of allowances of $ 1,065 and $ 1,493 at April 30, 2026 and July 31, 2025, respectively
75,772 69,370
Inventories, net 52,420 51,594
Prepaid expenses and other assets 5,212 5,961
Total Current Assets 196,345 177,383
Other Assets
Property, plant and equipment, net 150,799 149,704
Goodwill 16,017 16,017
Trademarks, trade names and patents, net of accumulated amortization of $ 724 and $ 693 at April 30, 2026 and July 31, 2025, respectively
6,575 6,603
Customer list, net of accumulated amortization of $ 10,124 and $ 9,278 at April 30, 2026 and July 31, 2025, respectively
18,061 18,907
Deferred income taxes 1,182 1,291
Operating lease right-of-use assets 13,440 14,219
Other 6,371 7,553
Total Other Assets 212,445 214,294
Total Assets $ 408,790 $ 391,677
The accompanying notes are an integral part of the Condensed Consolidated Financial Statements.
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OIL-DRI CORPORATION OF AMERICA
Condensed Consolidated Balance Sheet (continued)
(in thousands, except for share and per share amounts, unaudited)
LIABILITIES & STOCKHOLDERS’ EQUITY April 30,
2026 July 31,
2025
Current Liabilities
Current maturities of notes payable $ 1,000 $ 1,000
Accounts payable 13,848 16,808
Dividends payable 2,750 2,444
Operating lease liabilities 3,936 4,071
Accrued expenses 38,386 44,864
Total Current Liabilities 59,920 69,187
Noncurrent Liabilities
Long-term debt, net of unamortized debt issuance costs of $ 153 and $ 183 at April 30, 2026 and July 31, 2025, respectively
38,847 38,817
Deferred compensation 6,419 5,777
Long-term operating lease liabilities 10,546 11,296
Other 7,832 7,540
Total Noncurrent Liabilities 63,644 63,430
Total Liabilities 123,564 132,617
Commitments and contingencies (See note 7)
Stockholders’ Equity
Common Stock, par value $ .10 per share, issued 15,349,661 shares at April 30, 2026
and 15,276,261 shares at July 31, 2025
1,535 1,528
Class B Stock, par value $ .10 per share, issued 4,650,484 shares at April 30, 2026
and 4,650,484 shares at July 31, 2025
465 465
Additional paid-in capital 70,344 66,138
Retained earnings 312,119 277,500
Accumulated other comprehensive income 976 969
Less Treasury Stock, at cost ( 5,095,266 Common and 416,544 Class B shares at
April 30, 2026 and 4,902,881 Common and 380,628 Class B shares at July 31, 2025)
( 100,213 ) ( 87,540 )
Total Stockholders’ Equity 285,226 259,060
Total Liabilities & Stockholders’ Equity $ 408,790 $ 391,677
The accompanying notes are an integral part of the Condensed Consolidated Financial Statements.
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OIL-DRI CORPORATION OF AMERICA
Condensed Consolidated Statements of Operations
(in thousands, except for share and per share amounts, unaudited)
For the Nine Months Ended April 30,
2026 2025
Net Sales $ 364,552 $ 360,360
Cost of Goods Sold ( 263,027 ) ( 252,110 )
Gross Profit 101,525 108,250
Selling, General and Administrative Expenses ( 51,785 ) ( 55,674 )
Income from Operations 49,740 52,576
Other Income (Expense)
Interest expense ( 1,648 ) ( 1,888 )
Interest income 1,087 358
Other, net 2,220 ( 336 )
Total Other Income (Expense), Net 1,659 ( 1,866 )
Income Before Income Taxes 51,399 50,710
Income Tax Expense ( 8,848 ) ( 9,769 )
Net Income 42,551 40,941
Earnings Per Share
Basic Common $ 3.15 $ 3.03
Basic Class B $ 2.37 $ 2.28
Diluted Common $ 2.93 $ 2.81
Diluted Class B $ 2.37 $ 2.28
Average Shares Outstanding
Basic Common 9,884 9,882
Basic Class B 4,035 3,991
Diluted Common 13,919 13,873
Diluted Class B 4,035 3,991
Dividends Declared Per Share
Common Stock $ 0.590 $ 0.465
Class B Stock $ 0.441 $ 0.350
The accompanying notes are an integral part of the Condensed Consolidated Financial Statements.
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OIL-DRI CORPORATION OF AMERICA
Condensed Consolidated Statements of Comprehensive Income
(in thousands, unaudited)
For the Nine Months Ended April 30,
2026 2025
Net Income Attributable to Oil-Dri $ 42,551 $ 40,941
Other Comprehensive Income (Loss):
Postretirement expenses (net of tax) ( 64 ) ( 71 )
Cumulative translation adjustment 71 53
Other Comprehensive Income (Loss)
7 ( 18 )
Total Comprehensive Income $ 42,558 $ 40,923
The accompanying notes are an integral part of the Condensed Consolidated Financial Statements.
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OIL-DRI CORPORATION OF AMERICA
Condensed Consolidated Statements of Operations
(in thousands, except for share amounts, unaudited)
For the Three Months Ended April 30,
2026 2025
Net Sales $ 126,329 $ 115,501
Cost of Goods Sold ( 92,601 ) ( 82,479 )
Gross Profit 33,728 33,022
Selling, General and Administrative Expenses ( 16,635 ) ( 19,118 )
Income from Operations 17,093 13,904
Other Income (Expense)
Interest expense ( 537 ) ( 548 )
Interest income 386 122
Other, net 969 770
Total Other Income, Net 818 344
Income Before Income Taxes 17,911 14,248
Income Tax Expense ( 3,385 ) ( 2,604 )
Net Income 14,526 11,644
Earnings Per Share
Basic Common $ 1.08 $ 0.86
Basic Class B
$ 0.81 $ 0.65
Diluted Common $ 1.00 $ 0.80
Diluted Class B
$ 0.81 $ 0.65
Average Shares Outstanding
Basic Common 9,848 9,907
Basic Class B
4,048 4,002
Diluted Common 13,896 13,909
Diluted Class B
4,048 4,002
Dividends Declared Per Share
Basic Common $ 0.2050 $ 0.1550
Basic Class B
$ 0.1530 $ 0.1165
The accompanying notes are an integral part of the Condensed Consolidated Financial Statements.
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OIL-DRI CORPORATION OF AMERICA
Condensed Consolidated Statements of Comprehensive Income
(in thousands, unaudited)
For the Three Months Ended April 30,
2026 2025
Net Income Attributable to Oil-Dri
$ 14,526 $ 11,644
Other Comprehensive Income (Loss):
Postretirement expenses (net of tax)
( 21 ) ( 24 )
Cumulative translation adjustment ( 78 ) 214
Other Comprehensive (Loss) Income ( 99 ) 190
Total Comprehensive Income
$ 14,427 $ 11,834
The accompanying notes are an integral part of the Condensed Consolidated Financial Statements.
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OIL-DRI CORPORATION OF AMERICA
Condensed Consolidated Statements of Stockholders' Equity
(in thousands, except for share amounts, unaudited)
For the Three Months Ended April 30
Number of Shares
Common & Class B Stock Treasury
Stock Common
& Class B
Stock Additional
Paid-In
Capital Retained
Earnings Treasury
Stock Accumulated
Other
Comprehensive
Income Total
Stockholders’
Equity
Balance, January 31, 2025 19,866,445 ( 5,275,972 ) $ 1,987 $ 63,195 $ 257,349 $ ( 87,232 ) $ 561 $ 235,860
Net Income — — — — 11,644 — — 11,644
Other Comprehensive Income — — — — — — 190 190
Dividends Declared — — — — ( 2,104 ) — — ( 2,104 )
Purchases of Treasury Stock — ( 1,545 ) — — — ( 69 ) — ( 69 )
Net issuance of stock under long-term incentive plans 53,300 ( 400 ) 5 3 — ( 8 ) — —
Amortization of Restricted Stock — — — 1,338 — — — 1,338
Balance, April 30, 2025 19,919,745 ( 5,277,917 ) $ 1,992 $ 64,536 $ 266,889 $ ( 87,309 ) $ 751 $ 246,859
Balance, January 31, 2026 19,989,245 ( 5,506,829 ) $ 1,999 $ 68,980 $ 300,343 $ ( 99,947 ) $ 1,075 $ 272,450
Net Income — — — — 14,526 — — 14,526
Other Comprehensive Loss — — — — — — ( 99 ) ( 99 )
Dividends Declared — — — — ( 2,750 ) — — ( 2,750 )
Purchases of Treasury Stock — ( 2,481 ) — — — ( 173 ) — ( 173 )
Net issuance of stock under long-term incentive plans 10,900 ( 2,500 ) 1 92 — ( 93 ) — —
Amortization of Restricted Stock — — — 1,272 — — — 1,272
Balance, April 30, 2026 20,000,145 ( 5,511,810 ) $ 2,000 $ 70,344 $ 312,119 $ ( 100,213 ) $ 976 $ 285,226
For the Nine Months Ended April 30
Number of Shares
Common & Class B Stock Treasury Stock Common & Class B Stock Additional Paid-In Capital Retained Earnings Treasury Stock Accumulated Other Comprehensive Income Total Stockholders' Equity
Balance, July 31, 2024 19,825,170 ( 5,230,529 ) $ 1,982 $ 60,031 $ 232,247 $ ( 84,441 ) $ 769 $ 210,588
Net Income — — — — 40,941 — — 40,941
Other Comprehensive Loss — — — — — — ( 18 ) ( 18 )
Dividends Declared — — — — ( 6,299 ) — — ( 6,299 )
Purchases of Treasury Stock — ( 34,966 ) — — — ( 2,233 ) — ( 2,233 )
Net issuance of stock under long-term incentive plans 94,575 ( 12,422 ) 10 625 — ( 635 ) — —
Amortization of Restricted Stock — — — 3,880 — — — 3,880
Balance, April 30, 2025 19,919,745 ( 5,277,917 ) $ 1,992 $ 64,536 $ 266,889 $ ( 87,309 ) $ 751 $ 246,859
Balance, July 31, 2025 19,926,745 ( 5,283,509 ) $ 1,993 $ 66,138 $ 277,500 $ ( 87,540 ) $ 969 $ 259,060
Net Income — — — — 42,551 — — 42,551
Other Comprehensive Income — — — — — — 7 7
Dividends Declared — — — — ( 7,932 ) — — ( 7,932 )
Purchases of Treasury Stock — ( 224,601 ) — — — ( 12,537 ) — ( 12,537 )
Net issuance of stock under long-term incentive plans 73,400 ( 3,700 ) 7 129 — ( 136 ) — —
Amortization of Restricted Stock — — — 4,077 — — — 4,077
Balance, April 30, 2026 20,000,145 ( 5,511,810 ) $ 2,000 $ 70,344 $ 312,119 $ ( 100,213 ) $ 976 $ 285,226
The accompanying notes are an integral part of the Condensed Consolidated Financial Statements.
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OIL-DRI CORPORATION OF AMERICA
Condensed Consolidated Statements of Cash Flows
(in thousands, unaudited)
For the Nine Months Ended April 30,
CASH FLOWS FROM OPERATING ACTIVITIES 2026 2025
Net Income $ 42,551 $ 40,941
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization 17,186 16,391
Non-cash stock-based compensation 4,077 3,880
Provision for bad debts and cash discounts ( 169 ) 436
Loss on impairment of patent applications — 48
Accretion of asset retirement obligation 190 143
Loss on the disposals of property, plant and equipment 413 29
(Increase) decrease in assets:
Accounts receivable ( 6,203 ) ( 3,816 )
Inventories ( 766 ) ( 2,547 )
Prepaid expenses 463 1,234
Deferred income taxes
73 ( 116 )
Other assets 4,091 3,012
Increase (decrease) in liabilities:
Accounts payable ( 641 ) 495
Accrued expenses ( 5,529 ) ( 2,268 )
Deferred compensation 642 548
Other liabilities ( 3,170 ) ( 3,422 )
Total Adjustments 10,657 14,047
Net Cash Provided by Operating Activities 53,208 54,988
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures ( 20,918 ) ( 24,483 )
Proceeds from sale of property, plant and equipment — 89
Acquisition of a business — ( 115 )
Dispositions of short-term investments 312 —
Net Cash Used in Investing Activities ( 20,606 ) ( 24,509 )
CASH FLOWS FROM FINANCING ACTIVITIES
Payments on revolving credit facility — ( 10,000 )
Dividends paid ( 7,626 ) ( 6,290 )
Purchases of treasury stock ( 12,537 ) ( 2,233 )
Net Cash Used in Financing Activities ( 20,163 ) ( 18,523 )
Effect of exchange rate changes on cash and cash equivalents 44 38
Net Increase in Cash and Cash Equivalents 12,483 11,994
Cash, Cash Equivalents and Restricted Cash, Beginning of Period
50,458 24,481
Cash, Cash Equivalents and Restricted Cash, End of Period $ 62,941 $ 36,475
The accompanying notes are an integral part of the Condensed Consolidated Financial Statements.
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OIL-DRI CORPORATION OF AMERICA
Condensed Consolidated Statements of Cash Flows - Continued
(in thousands, unaudited)
For the Nine Months Ended April 30,
2026 2025
Supplemental disclosures:
Restricted Cash included in prepaid expenses and other assets:
Beginning balance $ — $ 1,000
Converted to unrestricted cash $ — $ ( 885 )
Final settlement of acquisition of Ultra Pet $ — $ ( 115 )
Ending balance $ — $ —
Other cash flows:
Interest payments, net of amounts capitalized $ 1,152 $ 1,172
Income tax payments, net of refunds
$ 7,635 $ 9,588
Non-cash investing and financing activities:
Change in capital expenditures in accounts payable $ ( 2,323 ) $ ( 2,253 )
Change in capital expenditures in accrued expenses $ ( 1,014 ) $ ( 4,620 )
Cash dividends declared and accrued $ 2,750 $ 2,105
The accompanying notes are an integral part of the Condensed Consolidated Financial Statements.
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OIL-DRI CORPORATION OF AMERICA
Notes To Condensed Consolidated Financial Statements
(Unaudited)
1. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information and in compliance with instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The financial statements and the related notes are condensed and should be read in conjunction with the Consolidated Financial Statements and related notes included in our Annual Report on Form 10-K for the fiscal year ended July 31, 2025.
The unaudited Condensed Consolidated Financial Statements include the accounts of Oil-Dri Corporation of America and its subsidiaries. All significant intercompany transactions are eliminated. Except as otherwise indicated herein or as the context otherwise requires, references to "Oil-Dri," the "Company," "we," "us" or "our" refer to Oil-Dri Corporation of America and its subsidiaries.
The unaudited Condensed Consolidated Financial Statements reflect all adjustments, consisting of normal recurring accruals which are, in the opinion of management, necessary for a fair presentation of the statements contained herein. Operating results for the three and nine months ended April 30, 2026, are not necessarily an indication of the results that may be expected for the fiscal year ending July 31, 2026.
Management Use of Estimates
The preparation of the unaudited Condensed Consolidated Financial Statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, and disclosure of contingent assets and liabilities as of the date of the unaudited Condensed Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period, as well as the related disclosures. Estimates and assumptions about future events cannot be made with certainty. All of our estimates and assumptions are revised periodically. Actual results could differ from these estimates.
Summary of Significant Accounting Policies
Our significant accounting policies, which are summarized in detail in our Annual Report on Form 10-K for the fiscal year ended July 31, 2025, have not materially changed. The following is a description of certain of our significant accounting policies:
Trade Receivables. We recognize trade receivables when control of finished products is transferred to our customers. We record an allowance for credit losses based on our expectations and a periodic review of our accounts receivable, including a review of the overall aging of accounts, consideration of customer credit risk, and analysis of facts and circumstances about specific accounts. A customer account is determined to be uncollectible when it is probable that a loss will be incurred after we have completed our internal collection procedures, including termination of shipments, direct customer contact and formal demand of payment. We retain outside collection agencies to facilitate our collection efforts. Past due status is determined based on contractual terms and customer payment history. We also include an allowance for expected cash discounts to be taken by our customers. Accounts receivable was $ 75.8 million, $ 69.4 million, and $ 62.2 million as of April 30, 2026, July 31, 2025, and July 31, 2024, respectively.
Property, Plant and Equipment. Property, plant and equipment includes depreciable assets such as building, machinery, equipment, furniture, vehicles, and capitalized spare parts. These assets are depreciated using the straight-line method over their estimated useful lives. Major improvements and betterments are capitalized, while maintenance and repairs that do not extend the useful life or increase functionality of the applicable assets are expensed as incurred. Interest expense may also be capitalized for assets that require a period of time to prepare them for their intended use.
These assets are carried at cost on the unaudited Condensed Consolidated Balance Sheet and are reviewed for possible impairment on an annual basis or when circumstances indicate that an asset may become impaired. We take into consideration idle and underutilized equipment and review business plans for possible impairment. When impairment is indicated, an
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impairment charge is recorded for the difference between the carrying value of the asset and its fair market value.
The composition of property, plant and equipment is as follows (in thousands):
April 30,
2026 July 31,
2025
Gross property, plant and equipment $ 366,934 $ 356,079
Accumulated depreciation and amortization ( 216,135 ) ( 206,375 )
Total Property, Plant and Equipment, Net $ 150,799 $ 149,704
Land, Mining Property and Mineral Rights. We surface mine sorbent minerals on property that we either own or lease as part of our overall operations. A significant part of our overall mining cost is incurred during the process of removing the overburden (non-usable material) from the mine site, thus exposing the sorbent material used in a majority of our production processes. These stripping costs are treated as a variable inventory production cost and are included in cost of goods sold in the period they are incurred. We defer and amortize the pre-production overburden removal costs during the development phase associated with opening a new mine.
Additionally, it is our policy to capitalize the purchase cost of land and mineral rights, including associated legal, survey and real estate fees. The costs of obtaining mineral rights, including legal fees and drilling expenses, are also capitalized. Pre-production development costs on new mines and any prepaid royalties that may be offset against future royalties due upon extraction of the minerals are also capitalized. All exploration related costs are expensed as incurred.
Reclamation. We perform ongoing reclamation activities during the normal course of our overburden removal. As overburden is removed from a mine site, it is hauled to previously mined sites and is 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. The reclamation assets are depreciated over the estimated useful lives of the respective mines. The reclamation liabilities are increased based on a yearly accretion charge over the estimated useful lives of the respective mines.
Leases. ASC 842, Leases , provides that a contract is, or contains, a lease if it conveys the right to control the use of an identified asset and, accordingly, a lease liability and a related right-of-use ("ROU") asset is recognized at the commencement date on our unaudited Condensed Consolidated Balance Sheet. As provided in ASC 842, we have elected not to apply these measurements and recognition requirements to short-term leases (i.e., leases with a term of 12 months or less). Short-term leases will not be recorded as ROU assets or lease liabilities on our unaudited Condensed Consolidated Balance Sheet, and the related lease payments will be recognized in net earnings on a straight-line basis over the lease term. For leases other than short-term leases, the lease liability is equal to the present value of unpaid lease payments over the remaining lease term. The lease term may reflect options to extend or terminate the lease when it is reasonably certain that such options will be exercised. To determine the present value of the lease liability, we use an incremental borrowing rate, which is defined as the rate of interest we would have to pay to borrow (on a collateralized basis over a similar term) an amount equal to the lease payments in similar economic environments. The ROU asset is based on the corresponding lease liability adjusted for certain costs such as initial direct costs, prepaid lease payments and lease incentives received. Both operating and finance lease ROU assets are reviewed for impairment, consistent with other long-lived assets, whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. After a ROU asset is impaired, any remaining balance of the ROU asset is amortized on a straight-line basis over the shorter of the remaining lease term or the estimated useful life. After the lease commencement date, we evaluate lease modifications, if any, that could result in a change in the accounting for leases.
Certain of our leases provide for variable lease payments that vary due to changes in facts and circumstances occurring after the commencement date, other than the passage of time. Variable lease payments that are dependent on an index or rate (e.g., the Consumer Price Index) are included in the initial measurement of the lease liability and the ROU asset. Variable lease payments that are not known at the commencement date and are determinable based on the performance or use of the underlying asset, are expensed as incurred. Our variable lease payments primarily include common area maintenance charges based on the percentage of the total square footage leased and the usage of assets, such as photocopiers.
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Some of our contracts may contain lease components as well as non-lease components, such as an agreement to purchase services. As allowed under ASC 842, we have elected not to separate the lease components from non-lease components for all asset classes, and we will not allocate the contract consideration to these components. This policy was applied to all existing leases upon adoption of ASC 842 and will be applied to new leases on an ongoing basis.
Revenue Recognition. We recognize revenue when performance obligations under the terms of the contracts with customers are satisfied. Our performance obligation generally consists of the promise to sell finished products to wholesalers, distributors, retailers or consumers and our obligations have an original duration of one year or less. Control of the finished products are generally transferred upon shipment to, or receipt at, customers' locations, as determined by the specific terms of the orders. We have one customer who requested that the title and risk of loss transfer when production is completed. For that customer, we produce and physically segregate finished goods in our warehouses. We have completed our performance obligation when control is transferred, and we recognize revenue accordingly. Taxes collected from customers and remitted to governmental authorities are excluded from net sales. Sales returns are not material nor are warranties or any related obligations.
We have an unconditional right to consideration under the payment terms specified in the contracts upon completion of the performance obligation. We may require certain customers to provide payment in advance of product shipment. We recorded a liability for these advance payments of $ 0.6 million as of April 30, 2026 and $ 0.3 million as of July 31, 2025. This liability is reported in Other within Accrued Expenses on the unaudited Condensed Consolidated Balance Sheet. There was $ 0.3 million revenue recognized during the nine months ended April 30, 2026, that was included in the liability for advance payments at the beginning of the period.
We routinely commit to one-time or ongoing trade promotion programs directly with consumers, such as coupon programs, and also with customers, such as volume discounts, cooperative marketing and other arrangements. We estimate and accrue the expected costs of these programs. These costs are considered variable consideration under ASC 606, Revenue from Contracts with Customers , and are netted against sales when revenue is recorded. The accruals are based on our best estimate of the amounts necessary to settle future and existing obligations on products sold as of the balance sheet date. To estimate these accruals, we rely on our historical experience of trade spending patterns and that of the industry, current trends and forecasted data.
Selling, General and Administrative Expenses. Selling, general and administrative expenses ("SG&A") include salaries, wages and benefits associated with staff outside the manufacturing and distribution functions, all marketing related costs, any miscellaneous trade spending expenses not required to be included in net sales, research and development costs, depreciation and amortization related to assets outside the manufacturing and distribution process, and all other non-manufacturing and non-distribution expenses.
Other Current and Noncurrent Liabilities. Other liabilities include the accruals for general expenses not yet paid, cash collected not yet vouchered, legal reserves, postretirement health benefit obligations, and reclamation liability accrual. Current liabilities are due to be paid within the next 12 months. Other noncurrent liabilities on the unaudited Condensed Consolidated Balance Sheet include $ 6.1 million and $ 5.9 million for the reclamation liability as of April 30, 2026, and July 31, 2025, respectively, and $ 1.7 million and $ 1.6 million for the postretirement health benefit as of April 30, 2026 and July 31, 2025, respectively.
New Accounting Pronouncements and Regulations.
Recently Adopted Accounting Standards
In November 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2023-07, "Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures" ("ASU 2023-07"). These amendments primarily require enhanced disclosures about significant segment expenses regularly provided to the chief operating decision maker and included within each reported measure of segment profit or loss. In addition, ASU No. 2023-07 also requires all annual disclosures currently required by Topic 280 to be included in interim periods. These amendments are to be applied retrospectively for all periods presented in the financial statements and are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. Refer to Note 10 - Operating Segments of this Form 10-Q for the enhanced disclosures added as a result of the adoption of ASU 2023-07.
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Recently Issued Accounting Standards Not Yet Adopted
In December 2023, the FASB issued ASU No. 2023-09, "Income Taxes (Topic 740): Improvements to Income Tax Disclosures." These amendments primarily require enhanced disclosures and disaggregation of income tax information by jurisdiction in the annual income tax reconciliation and quantitative disclosures regarding income taxes paid. These amendments are to be applied prospectively, with the option to apply the standard retrospectively, for annual periods beginning after December 15, 2024. Early adoption is permitted. We plan to adopt this amendment as of July 31, 2026. We do not expect the amendment to have a material impact on the Company's consolidated financial statement disclosures.
In November 2024, the FASB issued ASU No. 2024-03, "Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses" ("ASU 2024-03"). The pronouncement expands the disclosure requirements for expenses, specifically by providing more detailed information about the types of expenses in commonly presented expense captions. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. We are currently evaluating the impact that ASU 2024-03 will have on the Company's consolidated financial statement disclosures.
In July 2025, the FASB issued ASU 2025-05, "Measurement of Credit Losses for Accounts Receivable and Contract Assets" ("ASU 2025-05"), which provides a practical expedient that assumes current conditions as of the balance sheet date remain unchanged when developing forecasts for estimating expected credit losses. Under ASU 2025-05, an entity is required to disclose that it has elected to use the practical expedient and the election should be applied prospectively. ASU 2025-05 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2025, with early adoption permitted. We do not expect the amendment to have a material impact on the Company's consolidated financial statement disclosures, however we will continue to assess through the adoption period.
In September 2025, the FASB issued ASU 2025-06, "Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software" ("ASU 2025-06"), which provides clarification and improvements to the accounting for internal-use software costs under ASC 350-40, Intangibles – Goodwill and Other – Internal-Use Software. The guidance includes amendments related to capitalization of implementation costs, subsequent measurement, and related presentation and disclosure requirements. ASU 2025-06 is effective for fiscal years beginning after December 15, 2027, including interim periods within those fiscal years. We are currently evaluating the impact that ASU 2025-06 will have on the Company's consolidated financial statement disclosures.
In December 2025, the FASB issued ASU 2025-10, "Government Grants (Topic 832): Accounting for Government Grants Received by Business Entities" ("ASU 2025-10"). This amendment establishes authoritative guidance on the recognition, measurement and presentation of government grants received by business entities. ASU 2025-10 is effective for fiscal years beginning after December 15, 2028, including interim periods within those years, with early adoption permitted. Given the nature of our existing government-related arrangements, we do not expect the amendment to have a material impact on the Company's consolidated financial statement disclosures, however we will continue to assess through the adoption period.
In December 2025, the FASB issued ASU 2025-11, "Interim Reporting (Topic 270): Narrow-Scope Improvements" ("ASU 2025-11"). These amendments are intended to improve the navigability of interim reporting guidance, clarify when ASC 270 applies, and provide a comprehensive list of required interim disclosures including a requirement for entities to disclose events that occur after the end of the most recent annual reporting period that have a material impact on the entity. ASU 2025-11 is effective for interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. We are currently evaluating the impact that ASU 2025-11 will have on the Company's consolidated financial statement disclosures.
In December 2025, the FASB issued ASU 2025-12, "Codification Improvements" ("ASU 2025-12") which includes amendments for technical corrections, clarifications and revisions to existing codification intended to improve consistency of application, remove ambiguity and enhance overall usability. These improvements do not introduce new accounting requirements and are not expected to result in significant changes to accounting practices. ASU 2025-12 is effective for annual periods beginning after December 15, 2026, including interim periods within those fiscal years. We are currently evaluating the impact that ASU 2025-12 will have on the Company's consolidated financial statement disclosures.
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2. EARNINGS PER SHARE
We utilize the two-class method to report our earnings per share ("EPS"). The two-class method is an earnings allocation formula that determines EPS for each class of common stock according to dividends declared and participation rights in undistributed earnings. Common Stock is entitled to cash dividends equal to at least 133.33 % on a per share basis of the cash dividend paid on Class B Stock. In computing EPS, the Company has allocated dividends declared to shares of Common Stock and Class B Stock based on amounts declared for each class of stock and 33.33 % more of the undistributed earnings have been allocated to shares of Common Stock than to shares of Class B Stock on a per share basis. Common Stock is entitled to one vote per share and Class B Stock is entitled to ten votes per share. Common Stock have no conversion rights. Class B Stock is convertible by the holders thereof on a share-by-share basis into Common Stock at any time and is subject to mandatory conversion under certain circumstances. Basic EPS is computed by dividing net earnings, reduced for any distributed and undistributed earnings allocated to unvested restricted shares, by the weighted-average number of shares outstanding during the period for each class of common stock. Diluted EPS for Common Stock is derived utilizing the most dilutive result of the if-converted, treasury stock and two-class methods. In our case, the if-converted method is more dilutive than the two-class method and because our unvested restricted stock participates in dividends and is therefore anti-dilutive the treasury stock method does not apply. For Class B Stock, diluted EPS is derived utilizing the two-class method since, as with our Common Stock, our unvested restricted stock participates in dividends and is therefore anti-dilutive, making the treasury stock method inapplicable. The reverse treasury stock method is also inapplicable to both classes as we have no obligation to repurchase our Common Stock or Class B Stock. In both the if-converted and two-class methods, diluted EPS is computed by dividing net earnings by the weighted-average number of shares and potential shares outstanding during the period, taking into consideration different potential shares outstanding based on the method used. Dilution for Common Stock takes into consideration the effect of both unvested restricted shares and convertible shares of Class B Stock, unless such shares are anti-dilutive, in which case they are not considered. Dilution for Class B Stock takes into consideration the effect of unvested restricted shares, unless such shares are anti-dilutive, in which case they are not considered.
Below is a reconciliation of the calculation of basic and diluted EPS.
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For the Nine Months Ended April 30, 2026 For the Nine Months Ended April 30, 2025
(in thousands, except for per share data) (in thousands, except for per share data)
Total Common Class B Total Common Class B
Net income $ 42,551 $ 32,501 $ 10,050 $ 40,941 $ 31,201 $ 9,740
Distributed and undistributed earnings on restricted shares $ ( 1,820 ) $ ( 1,334 ) $ ( 486 ) $ ( 1,940 ) $ ( 1,285 ) $ ( 655 )
Income available to stockholders $ 40,731 $ 31,167 $ 9,564 $ 39,001 $ 29,916 $ 9,085
Net Income (Numerator) $ 31,167 $ 9,564 $ 29,916 $ 9,085
Weighted Average Shares Outstanding (Denominator) 9,884 4,035 9,882 3,991
Basic EPS $ 3.15 $ 2.37 $ 3.03 $ 2.28
Effect of dilution - Net Income (1)
$ 9,564 $ — $ 9,085 $ —
Net income assuming dilution (Numerator) $ 40,731 $ 9,564 $ 39,001 $ 9,085
Effect of dilution - Shares (1)
4,035 — 3,991 —
Shares assuming dilution (Denominator) 13,919 4,035 13,873 3,991
Diluted EPS $ 2.93 $ 2.37 $ 2.81 $ 2.28
(1) The impact of 281,219 unvested shares of Common Stock and 135,090 unvested shares of Class B Stock were anti-dilutive therefore not included in the calculation of diluted EPS for the nine months ended April 30, 2026. The impact of 259,469 unvested shares of Common Stock and 124,187 unvested shares of Class B Stock were anti-dilutive, and therefore not included in the calculation of diluted EPS for the nine months ended April 30, 2025.
For the Three Months Ended April 30, 2026 For the Three Months Ended April 30, 2025
(in thousands, except for per share data) (in thousands, except for per share data)
Total Common Class B Total Common Class B
Net income $ 14,526 $ 11,097 $ 3,429 $ 11,644 $ 8,884 $ 2,760
Distributed and undistributed earnings on restricted shares ( 623 ) ( 472 ) ( 151 ) ( 540 ) ( 367 ) ( 173 )
Income available to stockholders $ 13,903 $ 10,625 $ 3,278 $ 11,104 $ 8,517 $ 2,587
Net Income (Numerator) $ 10,625 $ 3,278 $ 8,517 $ 2,587
Weighted Average Shares Outstanding (Denominator) 9,848 4,048 9,907 4,002
Basic EPS $ 1.08 $ 0.81 $ 0.86 $ 0.65
Effect of dilution - Net Income (1)
$ 3,278 $ — $ 2,587 $ —
Net income assuming dilution (Numerator) $ 13,903 $ 3,278 $ 11,104 $ 2,587
Effect of dilution - Shares (1)
4,048 — 4,002 —
Shares assuming dilution (Denominator) 13,896 4,048 13,909 4,002
Diluted EPS $ 1.00 $ 0.81 $ 0.80 $ 0.65
(1) The impact of 267,018 unvested shares of Common Stock and 125,345 unvested shares of Class B Stock were anti-dilutive therefore not included in the calculation of diluted EPS for the three months ended April 30, 2026. The impact of 268,920 unvested shares of Common Stock and 132,528 unvested shares of Class B Stock were anti-dilutive, and therefore not included in the calculation of diluted EPS for the three months ended April 30, 2025.
3. INVENTORIES
The composition of inventories is as follows (in thousands):
April 30,
2026 July 31,
2025
Finished goods $ 29,970 $ 29,401
Packaging 7,985 8,114
Spare parts
6,679 6,822
Other 7,786 7,257
Total Inventories $ 52,420 $ 51,594
Inventories are valued at the lower of cost (first-in, first-out) or net realizable value. Inventory costs include the cost of raw materials, packaging supplies, labor, and other overhead costs. The Company maintains reserves against inventory to reduce the carrying value to the expected net realizable value. These reserves are based upon a combination of factors including historical issues and market trends. Inventory reserves were $ 3.8 million as of April 30, 2026 and $ 3.7 million as of July 31, 2025.
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4. FAIR VALUE MEASUREMENTS
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The inputs used to measure fair value are prioritized into categories based on the lowest level of input that is significant to the fair value measurement. The categories in the fair value hierarchy are as follows:
Level 1: Quoted market prices in active markets for identical assets or liabilities.
Level 2: Observable market-based inputs for similar assets or liabilities or valuation models whose inputs are observable, directly or indirectly.
Level 3: Unobservable inputs.
Cash equivalents are classified as Level 1 of the fair value hierarchy because they are valued using quoted market prices in active markets. These cash instruments are primarily money market funds and are included in cash and cash equivalents on the unaudited Condensed Consolidated Balance Sheet. We had $ 46.2 million in cash equivalents as of April 30, 2026, and $ 35.3 million in cash equivalents as of July 31, 2025.
Balances of accounts receivable, short-term investments and accounts payable approximated their fair values as of April 30, 2026, and July 31, 2025, due to the short maturity and nature of those balances.
Debt is reported at outstanding face value, less unamortized debt issuance costs. The estimated fair value of debt, including current maturities, was $ 40.7 million and $ 40.3 million as of April 30, 2026, and July 31, 2025, respectively. The fair value was estimated using the exit price notion of fair value and is classified as Level 2. See Note 8 of the Notes to the unaudited Condensed Consolidated Financial Statements for further information about such debt.
5. INTANGIBLE ASSETS AND GOODWILL
Our intangible assets are mainly comprised of customer lists, patents, trademarks, trade names and goodwill.
We amortize customer lists on a straight-line basis over a useful life of 18 years and patents on a straight-line basis over periods ranging from 7 to 20 years. Estimated intangible amortization for fiscal year 2026 is $ 1.2 million. Estimated intangible amortization for each of the next five fiscal years is $ 1.2 million.
Trademarks and trade names acquired via acquisitions, with a carrying value of $ 5.6 million, were determined to have an indefinite life and are not amortized.
There have been no triggering events in fiscal years 2026 or 2025 that would indicate a new impairment analysis is needed.
6. ACCRUED EXPENSES
Accrued expenses are as follows (in thousands):
April 30,
2026 July 31,
2025
Salaries, Wages, Commissions and Employee Benefits $ 14,933 $ 20,532
Payables 12,962 13,036
Trade Promotions and Advertising
2,976 3,105
Freight 2,961 2,700
Taxes 1,687 2,249
Georgia Landfill Modification Reserve
149 819
Other 2,718 2,423
$ 38,386 $ 44,864
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7. OTHER CONTINGENCIES
We are party to various legal actions that arise from time to time that are ordinary in nature and incidental to the operation of our business, including ongoing litigation. While it is not possible at this time to determine with certainty the ultimate outcome of these or other lawsuits, we believe that none of the pending proceedings will have a material adverse effect on our business, financial condition, results of operations or cash flows.
In fiscal year 2023, we recorded a reserve of $ 2.5 million for anticipated modification costs that we expected to incur to address capacity issues at our sole landfill located in Ochlocknee, Georgia. Reserves are recorded when it is probable that a liability has been incurred, and the amount of the liability can be reasonably estimated. The amount of the reserve represented management’s best estimate of the costs for the modification with respect to this matter, at the time. Work began on the modifications during fiscal year 2024. We increased the total estimated cost by $ 0.6 million and $ 0.7 million in fiscal years 2024 and 2025, respectively. In fiscal year 2026, we decreased the total estimated cost by $ 0.2 million resulting in a total $ 3.6 million expense related to this matter. The modification work is expected to be completed during fiscal year 2026 and, as inherent uncertainties exist in these estimates, we will monitor through the completion of the modification but do not expect that remaining costs in excess of amounts accrued would have a material impact on the Company’s results of operations, financial condition and cash flows.
8. DEBT
We are party to an Amended and Restated Note Purchase and Private Shelf Agreement (as amended, the "Note Agreement") with PGIM, Inc. ("Prudential") and certain existing noteholders and purchasers affiliated with Prudential named therein. Pursuant to the Note Agreement, (i) on May 15, 2020 , we issued $ 10 million in aggregate principal amount of our 3.95 % Series B Senior Notes due May 15, 2030 (the "Series B Senior Notes"), of which $ 5 million aggregate principal amount remained outstanding as of April 30, 2026, (ii) on December 16, 2021 , we issued an additional $ 25 million in aggregate principal amount of our 3.25 % Series C Senior Notes due December 16, 2031 (the "Series C Senior Notes"), all of which remained outstanding as of April 30, 2026, and (iii) on April 30, 2024 we issued $ 10 million in aggregate principal amount of our 6.47 % Series D Senior Notes due April 30, 2033 (the "Series D Senior Notes"), all of which remained outstanding as of April 30, 2026. The Note Agreement also provides us with the ability to request, from time to time until September 21, 2026 , that Prudential affiliate(s) purchase, at Prudential’s discretion and on an uncommitted basis, additional senior unsecured notes of Oil-Dri (the “Shelf Notes,” and collectively with the Series B Senior Notes, Series C Senior Notes, and Series D Senior Notes, the “Notes”) in an aggregate principal amount of up to $ 75 million minus the aggregate principal amount of Notes then outstanding and Shelf Notes that have been accepted for purchase. Interest payable on any Shelf Note agreed to be purchased under the Note Agreement will be at a rate determined by Prudential and will mature no more than fifteen years after the date of original issue of such Shelf Note.
We are party to the Credit Agreement, dated as of January 27, 2006 (as previously amended, the “Credit Agreement”), among us, BMO Harris Bank N.A (“BMO Bank”), and certain of our domestic subsidiaries. The Credit Agreement provides for a $ 75 million unsecured revolving credit facility, including a maximum of $ 20 million for letters of credit.
The Credit Agreement contains restrictive covenants that, among other things and under various conditions, limit our ability to incur additional indebtedness or to dispose of assets. These restrictive covenants include certain financial covenants such as a covenant to maintain a maximum debt to earnings ratio and to maintain a certain fixed charge coverage ratio. On September 30, 2024, the Company entered into the Eighth Amendment to Credit Agreement (the “Eighth Amendment”). The Eighth Amendment amends the Credit Agreement to, among other things: (i) increase the amount the Company may borrow from BMO Bank from time to time pursuant to its revolving line of credit from up to $ 45 million to up to $ 75 million; (ii) increase the aggregate maximum amount of letters of credit from up to $ 10 million to up to $ 20 million; (iii) add an accordion provision to allow the Company to increase the revolving line of credit by up to an additional $ 50 million, subject to the terms and conditions set forth in the Eighth Amendment; (iv) extend the termination date to September 30, 2029 ; and (v) increase certain restrictive covenant thresholds, including but not limited to, an increase to the permitted acquisitions threshold in the restricted covenants from a cumulative total of $ 45 million to $ 100 million.
As of April 30, 2026, and July 31, 2025, we were in compliance with the restrictive covenants under the Credit Agreement. There were no new borrowings during the third quarter of fiscal year 2026. As of April 30, 2026, we do not have any outstanding borrowings under the Credit Agreement. We had $ 3.0 million of letters of credit outstanding under the Credit Agreement as of both April 30, 2026, and July 31, 2025.
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The Credit Agreement states that we may select a variable interest rate based on either the Bank of Montreal ("BMO") prime rate or an adjusted Secured Overnight Financing ("SOFR")-based rate, plus a margin that varies depending on our debt to earnings ratio, or a fixed rate as agreed between us and BMO. As of April 30, 2026, the variable rates would have been 6.75 % for the BMO prime-based rate or 5.06 % for the adjusted SOFR-based rate.
9. LEASES
We have operating leases primarily for real estate properties, including corporate headquarters, customer service and sales offices, manufacturing and packaging facilities, warehouses, and research and development facilities, as well as for rail tracks, railcars and office equipment. Certain of our leases for a shared warehouse and office facility, rail track and railcars have options to extend which we are reasonably certain we will exercise and, accordingly, have been considered in the lease term used to recognize our ROU assets and lease liabilities. To determine the present value of the lease liability, we use an incremental borrowing rate, which is defined as the rate of interest that the Company would have to pay to borrow (on a collateralized basis over a similar term) an amount equal to the lease payments in similar economic environments. Further information about our accounting policy for leases is included in Note 1 of the Notes to the unaudited Condensed Consolidated Financial Statements.
We have no material finance leases, and variable costs for operating leases are immaterial for the nine months ended April 30, 2026. Operating lease costs are included in Cost of Goods Sold or SG&A expenses in the unaudited Condensed Consolidated Statements of Operations based on the nature of the lease. The following table summarizes total lease costs for our operating leases (in thousands):
For the Three Months Ended April 30, For the Nine Months Ended April 30,
2026 2025 2026 2025
Operating lease cost $ 1,249 $ 1,337 $ 3,709 $ 4,076
Short-term operating lease cost $ 446 $ 318 $ 1,240 $ 1,025
Supplemental cash flow information related to leases was as follows (in thousands):
For the Three Months Ended April 30, For the Nine Months Ended April 30,
2026 2025 2026 2025
Cash paid for amounts included in the measurement of operating lease liabilities: $ 1,089 $ 1,137 $ 3,214 $ 3,423
Right-of-use assets obtained in exchange for new operating lease liabilities $ 52 $ — $ 2,433 $ —
Operating lease ROU assets and operating lease liabilities are separately presented on the unaudited Condensed Consolidated Balance Sheet, excluding leases with an initial term of twelve months or less. Other supplemental balance sheet information related to leases was as follows:
April 30, 2026 July 31, 2025
Weighted-average remaining lease term - operating leases 4.6 years 4.8 years
Weighted-average discount rate - operating leases 5.18 % 5.12 %
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Lease liability maturities as of April 30, 2026 are as follows (in thousands):
Fiscal year 2026 (remaining three months) $ 1,210
Fiscal year 2027 4,331
Fiscal year 2028 3,506
Fiscal year 2029 2,915
Fiscal year 2030 1,661
Thereafter 2,544
Total 16,167
Less: imputed interest ( 1,685 )
Net lease obligation $ 14,482
10. OPERATING SEGMENTS
We have two reportable operating segments: (1) Retail and Wholesale Products Group and (2) Business to Business Products Group. The Retail and Wholesale Products Group is comprised of our Cat Litter and Industrial and Sports Products and the Business to Business Products Group is comprised of our Agricultural and Horticultural, Fluids Purification, and Animal Health & Nutrition Products. These operating segments are managed separately, and each segment's major customers have different characteristics. The Retail and Wholesale Products Group customers include mass merchandisers, the farm and fleet channel, drugstore chains, pet specialty retail outlets, dollar stores, retail grocery stores, distributors of industrial cleanup and automotive products, environmental service companies, sports field product users and marketers of consumer products. The Business to Business Products Group customers include processors and refiners of edible oils, renewable diesel, petroleum-based oils and biodiesel fuel; manufacturers of animal feed and agricultural chemicals; and distributors of animal health and nutrition products. Our operating segments are also our reportable segments. The accounting policies of the segments are the same as those described in Note 1 of the Notes to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended July 31, 2025.
Net sales for our principal products by segment are as follows (in thousands):
Business to Business Products Group Retail and Wholesale Products Group
For the Nine Months Ended April 30,
Product 2026 2025 2026 2025
Cat Litter $ — $ — $ 198,895 $ 190,656
Industrial and Sports — — 35,553 35,195
Agricultural and Horticultural 36,615 32,396 — —
Fluids Purification 77,180 82,384 — —
Animal Health & Nutrition 16,309 19,729 — —
Net Sales $ 130,104 $ 134,509 $ 234,448 $ 225,851
Business to Business Products Group Retail and Wholesale Products Group
For the Three Months Ended April 30,
Product 2026 2025 2026 2025
Cat Litter $ — $ — $ 69,219 $ 59,743
Industrial and Sports — — 13,269 13,080
Agricultural and Horticultural 12,442 11,639 — —
Fluids Purification 25,040 25,269 — —
Animal Health & Nutrition 6,359 5,770 — —
Net Sales $ 43,841 $ 42,678 $ 82,488 $ 72,823
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Our chief operating decision maker (“CODM”) is our President and CEO. The CODM regularly reviews net sales, gross profit, and operating income by segment to assess profitability and assist in the allocation of resources. Net sales and operating income for each segment are provided below, along with the significant segment expense categories that are regularly provided and used by the CODM when assessing segment profitability and the allocation of resources. The significant amounts within the segment operating expenses include cost of goods sold, compensation and benefits, and advertising. Other operating expenses in the table below is comprised of all other SG&A expenses which include but are not limited to travel, research & development, technical service support, and amortization of intangibles. Our CODM reviews the performance of each segment regularly by analyzing financial results in conjunction with our internal financial forecasts.
The corporate expenses line in the table below represents certain unallocated expenses, including primarily salaries, wages and benefits, purchased services, rent, utilities and depreciation and amortization associated with corporate functions such as information systems, finance, legal, human resources and customer service.
For the Nine Months Ended April 30, 2026
(in thousands) Business to Business Products Group
Retail and Wholesale Products Group
Total
Net Sales $ 130,104 $ 234,448 $ 364,552
Cost of Goods Sold ( 79,334 ) ( 183,693 ) ( 263,027 )
Gross Profit 50,770 50,755 101,525
Compensation & Consultant
( 7,350 ) ( 6,364 ) ( 13,714 )
Advertising ( 736 ) ( 4,263 ) ( 4,999 )
Other Operating Expenses ( 4,292 ) ( 5,658 ) ( 9,950 )
Operating Income 38,392 34,470 72,862
Corporate Expenses ( 23,122 )
Income from Operations 49,740
Total Other Income, Net
1,659
Income Before Income Taxes 51,399
Income Tax Expense ( 8,848 )
Net Income $ 42,551
For the Nine Months Ended April 30, 2025
(in thousands) Business to Business Products Group
Retail and Wholesale Products Group
Total
Net Sales $ 134,509 $ 225,851 $ 360,360
Cost of Goods Sold ( 77,672 ) ( 174,438 ) ( 252,110 )
Gross Profit 56,837 51,413 108,250
Compensation & Consultant
( 6,615 ) ( 6,358 ) ( 12,973 )
Advertising ( 886 ) ( 4,602 ) ( 5,488 )
Other Operating Expenses ( 4,522 ) ( 6,039 ) ( 10,561 )
Operating Income 44,814 34,414 79,228
Corporate Expenses ( 26,652 )
Income from Operations 52,576
Total Other Expense, Net ( 1,866 )
Income Before Income Taxes 50,710
Income Tax Expense ( 9,769 )
Net Income $ 40,941
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For the Three Months Ended April 30, 2026
(in thousands) Business to Business Products Group
Retail and Wholesale Products Group
Total
Net Sales $ 43,841 $ 82,488 $ 126,329
Cost of Goods Sold ( 26,694 ) ( 65,907 ) ( 92,601 )
Gross Profit 17,147 16,581 33,728
Compensation & Consultant
( 2,521 ) ( 2,087 ) ( 4,608 )
Advertising ( 169 ) ( 1,554 ) ( 1,723 )
Other Operating Expenses ( 1,498 ) ( 1,641 ) ( 3,139 )
Operating Income 12,959 11,299 24,258
Corporate Expenses ( 7,165 )
Income from Operations 17,093
Total Other Income, Net
818
Income Before Income Taxes 17,911
Income Tax Expense ( 3,385 )
Net Income $ 14,526
For the Three Months Ended April 30, 2025
(in thousands) Business to Business Products Group
Retail and Wholesale Products Group
Total
Net Sales $ 42,678 $ 72,823 $ 115,501
Cost of Goods Sold ( 25,141 ) ( 57,338 ) ( 82,479 )
Gross Profit 17,537 15,485 33,022
Compensation & Consultant
( 2,263 ) ( 2,181 ) ( 4,444 )
Advertising ( 266 ) ( 1,772 ) ( 2,038 )
Other Operating Expenses ( 1,626 ) ( 1,823 ) ( 3,449 )
Operating Income 13,382 9,709 23,091
Corporate Expenses ( 9,187 )
Income from Operations 13,904
Total Other Income, Net 344
Income Before Income Taxes 14,248
Income Tax Expense ( 2,604 )
Net Income $ 11,644
We do not rely on any operating segment asset allocations, and we do not consider them meaningful because of the shared nature of our production facilities; however, we have estimated the segment asset allocations below for those assets for which we can reasonably determine. The unallocated asset category is the remainder of our total assets. The asset allocation is estimated and is not a measure used by our chief operating decision maker about allocating resources to the operating segments or in assessing their performance.
Assets
April 30, 2026 July 31, 2025
(in thousands)
Business to Business Products Group $ 100,249 $ 104,857
Retail and Wholesale Products Group 214,016 200,644
Unallocated Assets 94,525 86,176
Total Assets $ 408,790 $ 391,677
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11. STOCK-BASED COMPENSATION
The 2006 Plan permits the grant of stock options, stock appreciation rights, restricted stock, restricted stock units, performance awards and other stock-based and cash-based awards. Our employees and outside directors are eligible to receive grants under the 2006 Plan. The total number of shares of stock subject to grants under the 2006 Plan may not exceed 3,439,000 . As of April 30, 2026, there were 1,074,344 shares of Common Stock or Class B Stock available for future grants under this plan.
Restricted Stock
All of our non-vested restricted stock as of April 30, 2026 was issued under the 2006 Plan with vesting periods generally between one and five years . We determined the fair value of restricted shares as of the grant date. We recognize the related compensation expense over the period from the date of grant to the date the shares vest.
There were 73,400 and 135,850 restricted shares of Common Stock granted during the nine months ended April 30, 2026, and 2025, respectively. There were no restricted shares of Class B Stock granted during the nine months ended April 30, 2026, and 2025. Stock-based compensation expense was $ 1.0 million for the three months ended April 30, 2026, and 2025, and was $ 3.1 million and $ 2.9 million for the nine months ended April 30, 2026, and 2025, respectively.
A summary of restricted stock transactions is shown below:
Restricted Shares
(in thousands) Weighted Average Grant Date Fair Value
(per share)
Non-vested restricted stock outstanding at July 31, 2025 728 $ 28.52
Granted 73 $ 58.18
Vested ( 208 ) $ 21.42
Forfeitures ( 4 ) $ 36.82
Non-vested restricted stock outstanding at April 30, 2026 589 $ 34.66
12. ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)
The following table summarizes the changes in accumulated other comprehensive income (loss) by component as of April 30, 2026 (in thousands):
Postretirement Health Benefits Cumulative Translation Adjustment Total Accumulated Other Comprehensive Income (Loss)
Balance as of July 31, 2025 $ 1,205 $ ( 236 ) $ 969
Other comprehensive income before reclassifications, net of tax — 71 71
Amounts reclassified from accumulated other comprehensive income, net of tax ( 64 ) — ( 64 )
Net current-period other comprehensive (loss) income, net of tax ( 64 ) 71 7
Balance as of April 30, 2026 $ 1,141 $ ( 165 ) $ 976
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13. RELATED PARTY TRANSACTIONS
One member of our Board is currently the President and Chief Executive Officer of one of our vendors. Total payments to this vendor for fees and cost reimbursements were $ 0.1 million and $ 0.5 million for the three months ended April 30, 2026 and April 30, 2025, respectively, and $ 0.8 million and $ 1.0 million for the first nine months of fiscal years 2026, and 2025, respectively. There were no outstanding accounts payable due to that vendor as of either April 30, 2026, or July 31, 2025.
One member of our Board retired from the role of President and Chief Executive Officer of a customer of ours on September 28, 2019, and was party to a post-employment consulting agreement with the customer until September 30, 2025. Total sales to that customer, including sales to its subsidiaries, were $ 0.1 million for both the three months ended April 30, 2026, and April 30, 2025, and $ 0.2 million and $ 0.3 million for the first nine months of fiscal years 2026 and 2025, respectively. There were no outstanding amounts due from that customer as of either April 30, 2026, or July 31, 2025.
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Text extracted from the filing as submitted to EDGAR. Formatting, tables and exhibits are simplified for reading; the original document is authoritative for anything you rely on.