Oil-Dri to lose sales to largest customer

CHICAGO - Oil-Dri Corp. of America said Friday it expects to lose a "material amount" of branded cat litter sales and related profitability with its largest customer, which will hurt fiscal 2010 sales and net income.

Oil-Dri, which makes cat litter and other absorbent products, said the customer, which it did not name, "has decided to emphasize a reduced number of cat litter brands and the customer's own private label cat litter products in its stores."

The changes are expected to go into effect in August. The company's fiscal year ends in July.

"Given everything we see at this time, we expect that we will deliver meaningful earnings in fiscal 2010, though most likely below what we have reported in the past couple of fiscal years," said President and Chief Executive Daniel S. Jaffee in a statement.

The company's shares slumped $1.36, or 7.3 percent, to $17.40 in after-hours trading. The stock had closed up 50 cents at $18.76 in the regular session.

Copyright 2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.