Welcome to the Annual Meeting for Oil-Dri Corporation of America. Our host for today's call is Leslie Garber, Manager of Investor Relations. At this time, all participants will be in a listen-only mode. I will now turn the call over to your host, Leslie Garber, you may begin.

Good morning and welcome to Oil-Dri Corporation of America's 2022 Annual Meeting of Stockholders. My name is Leslie Garber and I am the Manager of Investor Relations at Oil-Dri. We are conducting this meeting virtually, a format utilized during the COVID-19 pandemic, which enables greater stockholder attendance and participation, improved efficiencies, increases our ability to communicate with stockholders and reduces costs. On your screen under Meeting Materials, you will find the Meeting Agenda, Rules of Conduct, List of Stockholders of Record and Oil-Dri's Proxy Statement and Annual Report. During the meeting today, we will be covering the election of directors and one other proposal. Next will be the business presentations and financial review followed by time for Q&A. We ask that you submit your questions online under the Ask a Question field on your screens. Only stockholders of record are able to ask questions during the meeting. Stockholders will also be able to vote online by clicking on the Vote Here button on your screens. Now it is my pleasure to introduce our General Counsel and Secretary, Laura Scheland, who will conduct the formal portion of today's meeting.

Good morning ladies and gentlemen. I now call to order the 2022 Annual Meeting of Stockholders of Oil-Dri Corporation of America to conduct the formal business set forth in the notice of meeting and proxy statements. Commencing on October 25, 2022, a notice regarding the availability of proxy materials or a copy of the proxy materials was mailed to all Oil-Dri stockholders of record as of the close of business on October 10, 2022, which is the record date fixed by Oil-Dri's Board of Directors for the determination of stockholders entitled to notice of and to vote at this meeting. Broadridge Financial Services has delivered an affidavit confirming the foregoing. Oil-Dri has appointed Peter Sablich of CT Hagberg to serve as the Inspector of Election for this meeting. He is present on the webcast and has taken the oath of office. As of October 2022 the record date for this meeting, there were 5,075,302 shares of Oil-Dri's common stock and 2,045,415 shares of Oil-Dri's Class B stock outstanding. Holders of our common stock are entitled to one vote per share and holders of our Class B stock are entitled to 10 votes per share and generally vote together without regard to Class. A quorum is present at this meeting if holders of a majority of our common stock and Class B stock outstanding and entitled to vote are present in person or represented by proxy. Thus, the number of votes necessary to constitute a quorum at this meeting is 12,790,255 votes. Mr. Sablich has informed me that there are more than such numbers of votes represented at this meeting. Therefore, I declare there is a quorum present for purposes of transacting business. Now, I will present the matters to be voted upon. If any stockholder would like to make a…

Thank you, Laura and welcome to our shareholders, our Oil-Dri teammates, I know they tune in and I know we even have some parents of teammates that are tuning in today, and so welcome everyone. Thank you. Proud of the quarter, proud of how the team performed in a very dynamic environment. Those of you who have owned our shares for a long time know what I like to do at this point in the presentation is cover new promotions of existing people in new positions of importance of the company and then also Vice Presidents who have joined us during the year or people that have been promoted to the Vice Presidential level during the year, because an investment in Oil-Dri really is a twofold investment. Number one, you're investing in our mineral and its value and our ability to understand that, but then you're really investing in our team who is going to help communicate that value to our customers and then sharing that value with them. So with that being your twofold investment, you know about our mineral and you'll hear more about our opportunities as we move forward. I'd like to cover our new Vice Presidents and senior promotions that occurred during the year. First, Chris Lamson is our Group Vice President of Retail and Wholesale. We feel very fortunate that Chris joined our team almost a year ago. He received his BS in Finance from St. Mary's of California. He then spent 18 years with The Clorox in many positions, including VP, General Manager of the Food and Charcoal Division, and Vice President of the Walmart Customer Team. He spent four and a half years as a Senior VP at Central Garden and Pet, again, giving him knowledge not only of the consumer products arena,…

And then last but not least, we have a new Vice President of Human Resources, Pat Walsh. Pat received his BS in Psychology from the University of Illinois, his Masters in HR and Industrial Relations, also from the University of Illinois. He spent 14 years with PepsiCo Frito Lay. He was a Senior HR Director, HR Manager. He's been with us a little under a year and has already had a major impact on our company, really embracing our lessons learned and our core values and leading the charge from that. And then also spearheading our talent management program which we -- really is nascent and he's been doing a great job at that. So Pat, really happy to have you on the team and investors you should be proud of the team that is every day trying to maximize your shareholder value. I'm not going to get into any of the details because that's what Susan Kreh is for. So I'm going to turn it over to our CFO and Chief Information Officer, Susan Kreh. world: And then last but not least, we have a new Vice President of Human Resources, Pat Walsh. Pat received his BS in Psychology from the University of Illinois, his Masters in HR and Industrial Relations, also from the University of Illinois. He spent 14 years with PepsiCo Frito Lay. He was a Senior HR Director, HR Manager. He's been with us a little under a year and has already had a major impact on our company, really embracing our lessons learned and our core values and leading the charge from that. And then also spearheading our talent management program which we -- really is nascent and he's been doing a great job at that. So Pat, really happy to have you on the…

Thank you, Dan. So we're going to talk a little bit about fiscal year 2022, but that's history. It was a tough year. We're glad to have that behind us. And we'll look at the results here for the first quarter of 2023. If I start fiscal 2022, our net sales were up 14% over the prior year with a lot of the trajectory and momentum coming in the back half of the year. And that momentum carried forward into the first quarter of fiscal '23 when we achieved record sales of $99 million, representing 19% growth over the first quarter in fiscal 2022. And that 19% growth is entirely attributable to pricing. Now, we did have some shift in mix in volume, meaning that we were down about 5% in volume in the quarter in our retail and wholesale business, but that was offset by the same amount of growth in our B2B business. And I think, Chris, can you give us a little color on what happened there in the first quarter?

Yes, and I think it's noted in the management discussion as well Susan. Primarily in our Co-man business, our Co-man partner exited really the entirety of the international piece of their business, expect we will lap that in March. So really, single biggest driver, if you look back at our consumer business and our industrial business volumes were flat slightly.

Thanks Chris. Internally, we assess our profitability on a per ton basis to ensure that we're generating the most value out of our non-renewable resources, our mineral, as Dan mentioned earlier. The volume was up 6% in terms of tons in fiscal year 2022 with volume gains in both the retail and wholesale and business to business channels. Moving forward to the first quarter of fiscal 2023, volume was essentially flat. And again, with the shift in mix, B2B being up, retail and wholesale being down for the reason Chris just gave you color on. When we look at net sales per ton of $421, that highlights the impact of our pricing actions in fiscal 2022 and dial forward to the first quarter of fiscal 2023 and that number is a record $473 per ton. And you can see that compares to $394 in the first quarter of 2022. As we talked about throughout all of fiscal 2022, gross profit per ton was adversely impacted by the timing of cost increases that hit us versus the timing of when we were able to get pricing into the market and into our customers. So a challenging year on a gross profit per ton basis in 2022, so we are excited about where we are sitting in 2023 with the first quarter gross profit per ton being $107 per ton, an increase of 62% over the first quarter a year ago. That flows through to net income per ton, both in the year and for the quarter. And that flows through to our basic earnings per common share, which you see in Q1 at $0.80 per share is almost equal to fiscal 2022's full year number of $0.83 per share. So momentum is on our side. We're seeing the impact of our…

Thanks, Susan. Happy to field that question. You know, as we've alluded to in prior quarters, service has been immensely challenged over the past year. One of our priorities has clearly been to restore service levels to historic levels. One of the ways we've done that is with very intentional and selective choiceful addition of inventory in the right places and our highest value added products to ensure that we can leverage our superior service as an advantage compared to our competitors and other customers.

Wonderful, thanks. With that, I'm going to wrap it up and actually turn it over to you, Aaron.

Thanks, Susan. Today I'd like to take a few minutes and I'm really excited to have the opportunity to talk about how Oil-Dri is investing in our future. We invest in many ways. We invest in our brands, we invest in our culture, we invest in our minerals and reserves, we invest in the environment, we invest in new products and innovation, and we invest in our teammates. Today, I would specifically like to talk about how we invest in our infrastructure. Oil-Dri is an 80-year business. Our producing facility is our foundation to what we do. I'm going to provide some really brief insight into our capital outlay, not in depth, but some examples of how we have invested and are continuing to invest in our facilities through our capital spend. Both Susan and Dan have made comments and there's a note in the disclosure and press release about our ongoing commitment. First, I'd like to talk about our philosophy. Any business finds itself with a continual conflict between investing in business growth endeavors, cost savings, and business continuity. And by business continuity, I mean savings, environmental compliance, safety, and the ongoing simple maintenance of our facilities. Oil-Dri looks for very intentional and intelligent ways to find investments that align with our growth strategy, but also deliver on cost compression and continuity of business. In fiscal 2022, Oil-Dri spent just less than $23 million. I believe there's a question that's been fielded in the portal. Susan alluded to it earlier. We fully anticipate and expect investing in a very similar way, similar philosophy and similar level in the years ahead. Later today, you're going to hear from several of our commercial leaders about our growth strategies in those areas, specifically in the area of litter and animal health. I'm…

Thanks a bunch, Aaron. Good to be with you all this morning. And we're going to talk about staying the course and our focus on lightweight litter. I would have loved the double entendre if we were talking about staying the course with our coarse litter. And we feel good about that business, but really we see our growth coming in the lightweight litter business, both on the branded side and on the private label side. And Dan talked about may be and about a year into the role, and as I came in and looked at strategy, sometimes the new person wants to come in and candidly make a bunch of changes and really this presentation is about why we're not. We'll talk about a few new tactics and a few things that we're excited about in terms of lifting both of our branded and our private label business. But fundamentally, we are staying the course of private label because one highly consumer relevant. Who wouldn't want all other things equal, who wouldn't want a product that is a lot easier to shop for, a lot easier to handle at the point of consumption? Incredibly customer relevant, significantly lower cost than a freight laden business for our customers. And virtually all of our major customers are also driving environmental programs. It takes trucks off the road and we're advantaged here. Our mineral is the best natural way to achieve lightweight litter. And in a couple slides the focus here is working, so we'll share that as well. So again, a few tweaks, but we are staying the course in terms of our focus on lightweight litter. Overall a quick look at the growth in the overall cat litter business since 2018. You see impressive compounded growth up at the…

Thank you, Chris and good morning everyone. It's a real privilege to be able to speak with you this morning and to represent the Amlan Nutrition and Health team globally. Very excited about the opportunity we have with Amlan to build another very strong element of Oil-Dri’s business, and really bring a tremendous amount of value to an industry that is in really great need of innovation as we continue to meet the challenges to feed a hungry world. As we -- as I talked this morning, I want to focus on our North American team and really highlight one of the key regions of the world where Amlan has tremendous opportunity to grow our business. But before I do that, I'd like to start where we always like to start, which is the advantage that Amlan has being part of Oil-Dri and the legacy that the Oil-Dri Corporation brings to our business. There are a number of key elements to that. First and foremost is the leadership that we have with Dan and the Jaffee family. Dan is the third generation leader of our business, and because of that, we have very consistent strategy focus and our strong core values that we bring to this business. Oil-Dri also has, as I mentioned, a very diverse portfolio Amlan and the Animal Nutrition Health business is a great addition to that. We leveraged the very strong vertical integration of Oil-Dri being able to control the product from the ground all the way to the customer, ensuring that we have quality and traceability and sustainability in our products. We use a single source mineral, a number of locations, but a single source mineral that brings tremendous technology to this space. And Oil-Dri has been very consistent over the years in the investments…

Then below sorbent, we have a range of formulated products that utilize our clay as its backbone, but also bring in other additional compounds or adjuvants that allow us to have a broad portfolio focusing on a range of opportunities. Again, as pharmaceuticals other drugs or chemicals are removed from the diet driven both by regulatory requirements as well as consumer demand for clean food and feed. So this is the portfolio we're bringing to the United States, very excited about the opportunity that it offers, and we're seeing good acceptance by our customers as we roll this out. Year-over-year, the Amlan global sales have increased approximately 18%, tremendously strong growth, again driven by growth in all world areas, but also our rollout of our U.S. products, our North American products that are starting to penetrate the market. As feed prices rise in this state, we currently have a high commodity prices with the ban in Europe on meat being fed antibiotics. All of these are helping to drive the need for natural solutions that can provide the value that products previously utilized or once did. So we're seeing growth that we believe will be sustained and rapid across North America. Our sales have doubled in this region as we launched our new branded portfolio, as I mentioned, and this in large part is due to the team that we have and the strong efficacy that customers are seeing as they test and begin to utilize our products. I do want to mention that Asia still remains important to our long-term growth. We expect our sales in China to stabilize in fiscal year 2023. We saw a lot of challenges in the region from the pandemic, from supply chain, from the African swine flu. But all these are starting to…

Wade, thank you very, very much. Thank you to the whole Oil-Dri team. As I opened up an investment in Oil-Dri’s and investment in our people, and I'm sure you are as impressed with our team as I am, and so that we have a lot of momentum heading into the next quarters and the next fiscal years. We're going to open up the floor for questions. People who are submitting their questions, using the Ask a Question field on the webcast, questions or remarks obviously must be relevant to the meeting and pertinent to the matters brought before the meeting. Leslie will read the questions and then I will either answer it directly or direct it to a specific Oil-Dri teammate to field the question. So Leslie, number one?

Okay, the first one in the queue is, can you please address the implications of the Albertsons Kroger merger on Oil-Dri specifically, and the branded private label cat little market more broadly? As I recall, Nestle has a plant in California that is dedicated to supplying Kroger's private label that may or may not still be the case.

Great, thank you. Chris?

Yes, thanks, Leslie. We and Dan, we do business with both customers today. We see the -- I think we see the impending merger as having both some potential for real upside candidly, and I think, probably others across CPG that's selling to selling into one or both like we do would say there's a little bit of, a little bit of risk as well. I think most importantly, our existing business with them is in the litter – in the lightweight segment of litter with our existing business within the context of both where, and hopefully took this from the last presentation or from my presentation, we have significant advantage probably as evidenced by our private label market share being north of 70% our private label market share with lightweight. So that gives us confidence. I'd also say the question alluded to California in terms of a private label producer of lightweight, but even of course, I put our footprint up against really against anybody we compete with. We have a great footprint, which is particularly important given the freight cost driver that we talked about before. And specifically we too have a manufacturing facility that's vertically integrated like all of ours in California.

Great. Thank you.

Thank you.

Okay, so we have two questions related. One is from John Bair. And then the second one is from Robert Smith. So I'm going to just read them sort of together and have a joint answer. What is your outlook for Amlan sales growth that is driven from the combination of both, from repeat orders, from early adopters of products versus new potential customers? And then secondly, are you able to reaffirm your $40 million revenue budget target for Amlan in this fiscal year?

Great. And I'll field this Wade because you've covered a lot of it in your presentation, but we're in a very dynamic state with Amlan because it's truly a startup. We are in tests with major customers, and as Wade said, if any one of them begins to roll out and we have every confidence that they will, it will have a dramatic impact on the overall not just the division, but the whole business. So, we do -- we have communicated that our plan for the year is $40 million. We did $5.5 million in the first quarter, which only annualizes to 22. But it was a 52% increase over the prior year. But we're still not -- we're still in trials with these companies that could flip the needle pretty dramatically. So if you put a gun to my head, would I say we're going to do $40 million this year? I'd probably take the under, but the momentum is in the right direction. So let's say we hope at the very least we'll have a run rate of $40 million in the fourth quarter. But I'd like to actually make it, I just, it's so dynamic that, I'm not willing to bet my life on it, but we're still very, very, very bullish on the short, medium, and long-term future of Amlan.

Okay, great. The next question comes from Ethan Starr. Congratulations on a nice quarter. Dan. You mentioned last quarter that Amlan products are in numerous trials. What's the average length of a trial before a decision is made to buy or not buy Amlan's products? What percentage of companies that try Amlan’s product end up purchasing them?

Yes. And Wade, I'll turn this over to you. And it's very subjective because this is all new, but I would like to tap in your experience here and have you answer that question?

Yes, thank you, Dan. And thank you for the question. And it'll depend a lot by world area, but let me kind of give you a general sense. And this really plays off what Dan mentioned a moment ago. The runway or the time necessary to trial the products and to convince customers of the efficacy and the value really takes a number of months. We've generally worked through a presentation of information and data and R&D to moving to field trials with customers and then gradual adoption in their various complexes as they roll it out across an operation. So, understandably, that can take a number of months to achieve. I can report to you that we're well into that process in North America and certainly around the world, both with existing products and the new products that we have launched, we've consistently seen excellent performance and not only re-trialing, but beginning of commercial use by these large customers. So, as Dan said, we're very bullish on the year. We believe the volume will come in large tranches as customers adopt and be begin utilizing across their commercial operations. And we hope by year end, it'll be at a run rate that is consistent with our targets.

Great. Thank you, Wade.

Thank you. The next two questions that are related come from John Bair and Ethan Star, fluids purification sales growth. Is this a result of higher domestic demand, or is there much of this attributable to international sales? If mostly domestic what are your opportunities internationally? And then the second related question it says, Dan in your annual sorry, in your letter to stakeholders in the 2022 annual report, you noted that several renewable diesel plants are scheduled to begin operating in 2023. How many plants, do you expect to begin operating and what's the size of the opportunity for Oil-Dri?

Yes, and I'm going to turn this over to Bruce Patsey, our Vice President of Fluids purification Division, with the one caveat, he's not in the room with us here. So Bruce, just stay general. We don't give specifics on absolute numbers of plants or absolute dollars, but your general comments would be appreciated.

Sure. Thanks Dan. Basically we had growth mostly in our domestic, in North America and Latin America is where we saw our growth this year or the first quarter, I should say. And we do have opportunities internationally going forward. I think both in the fats and oils business and the renewable diesel business will have opportunities, as we look out in 2023 and 2024. With regard to the second question, there's going to be, there's not going to be a million plants coming on. These are very large facilities, so there'll be several plants in the next two years that will be built and be up and operating. Of course, Oil-Dri will be going after as much business as we possibly can in this marketplace. If I would take a guess that we might have a chance to get 15% to 30% growth in terms of production of our bleaching clay products in this market space. But we'll see, we'll be working hard to get earn that business.

Fantastic. And for those of you who are, I guess, new to the Oil-Dri investment, in many of our businesses, it's very much like the game of risk. If you played that when you were growing up, meaning you can only attack contiguous properties. So our plant is in Georgia, and so we have a unique competitive advantage in North America against our competitors who are in Malaysia or Singapore, or even in Europe. Conversely, they have a big advantage to us in those markets. And so that -- it's not a coincidence that a lot of our growth comes in U.S., in particular North America in general, and then South America in the bleaching of the business because we are closer to those markets than many, many of our competitors. But then the opposite is also true as you cross our moats of the Atlantic and Pacific oceans. So, thank you, Bruce.

Okay, next question. Are you seeing any meaningful improvement in your logistics bottlenecks? What are the biggest pressure points, meaning trucking rail, maritime shipping so on?

Great, and I'll call on J.T. Harrison, our Vice President of Logistics and Procurement. And if you're on mute, JT?

Good question, folks. And can you hear me, Dan?

Yes, we do. Thank you.

So maritime shipping is still the biggest bottleneck that we face. Our freight procurement strategies executed for domestic trucking for rail, for North American intermodal shipping are all driving great successes to prevent or alleviate any bottlenecks. The maritime market is still a difficult one for us, and most shippers. The global vessels schedule reliability is continuing to hover around 40%, which is a huge challenge. And despite that, we have unlocked some successes by our internal metrics. We are outperforming the market by 30%. And some of that success is the inventory we have built that was mentioned earlier, not just having that inventory, but also positioning it closer to the key export ports that we utilize to give us agility to meet the constantly changing vessel schedules of the ocean carriers.

Awesome, thank you, JT. We have one question that actually came into me, which is ironic, but I got it. And the question is, we've talked in the past about how Canada has gone all lightweight for Nestle Purina and how I think what about 55% of the market is now lightweight. And the question is, if the U.S. replicated that lightweight percentage, what would the growth be potentially in the United States?

Yes, so Dan, I'm doing a little back of the envelope math here, but we've obviously looked at this, and you're right, the number one player in Canada, we're benefiting significantly in that market. If the same thing were to happen in the U.S. by way today is around a $400 million at retail category it would more than double that. So I'm sorry, the growth would be more than double that. So the growth would be, about $800 million. So the lightweight category, if really if heavyweight and lightweight were roughly split would grow to over a $1 billion, so $800 million or so growth.

Fantastic. Yes, so great opportunity. And there's no reason to believe that U.S. cats are that different from Canadian cats.

Having lived in Canada, I can tell you they look pretty much the same. Consumer might be even more enlightened up there -- trickle down.

So we're very, very bullish. Like, I'm going to summarize, we're out questions and out of time, but you can see all of our business units are thriving and doing very well. Even, our industrial and sports business, which is sort of the Granddaddy of the divisions is doing well. And then some of our strategic initiatives are all starting to hit at the same time. You've got renewable diesel, our ag business is booming. You've got a lightweight cat litter. And again, we've talked about in the past, but it's very much an ESG effort. I mean, if the whole country adopted lightweight cat litter like they did with detergent, with concentrated detergent, they forced the shelves to go concentrated for carbon footprint reasons and logistical reasons. If the whole country went lightweight, it would reduce the carbon footprint of cat litter by about 40%. And so that Genie's not going back in the bottle. I don't see people in the future saying, I want heavier. I want to have a bigger impact on the environment. I see the exact opposite where I want lighter and I want to do things that are good from the environment, especially if they don't cost me money and don't suffer from performance. So I've always said all things being equal, if the, when lightweight and we believe it is, is at the right price and the right performance, the whole category's going. And so I'm very excited about the animal health business. Again, Genie is not going back into bottle. They're not going to reverse fields and say, okay, you guys, you can all start pumping antibiotics back into food production for humans. It's not happening. So we're in the right place in the right time, and we believe, again, we have…

That concludes today's conference call. Thank you for joining and have a pleasant day.