Oil-Dri Corp. of America (NYSE:ODC) Q4 2019 Earnings Conference Call - Final Transcript
Oct 11, 2019 • 11:00 am ET
Susan M. Kreh
finished goods and packaging. Some of this inventory increases the impact of the increased costs we discussed earlier and some has been driven by the build of incremental safety stock resulting from launching our ERP. During the fourth quarter, we have made good progress in reducing our inventory levels as inventory dropped $2.5 million from the third quarter of fiscal '19. This occurred primarily in finished goods as safety stock moved towards more normal levels.
During the year, we've also seen an increase in receivables of $1.9 million. This is driven by stronger sales in the fouth quarter. So to put a little color on that, fourth quarter sales this year our $70.1 million compared to fourth quarter sales last year of $65.6 million. So this increase has been partially offset by improvements we've achieved in driving down our days sales outstanding. We've driven them down by 10.1 days from the peak of 58.8 days, just subsequent to launching our ERP.
So with that brief summary, I'm going to turn it back over to you, Dan.
Daniel S. Jaffee
Great. Thank you, Susan. And before I open up to Q&A, I just want all of you to know, I'm on the road here. We are at a Latin American Animal Health Conference and it's been fantastic. We've met a lot of great customer meetings all around our new product offering Varium, but then I sat in on a couple of lecturers and not only are they talking about ABF, which is Antibiotic-Free, but now it's moving rapidly towards NAE, which is No Antibiotics Ever, and then they have NAE Plus, which is No Antibiotics Ever Plus, the animals are fed all vegetarian products.
So the globe is moving rapidly in favor of eliminating all antibiotics from the food chain, which creates a huge void because there are many issues that need to solved that the antibiotics were solving and we believe if we don't have the next best mousetrap [Phonetic], we certainly have one of the next best mousetrap. So we are in test and getting orders from all sorts of new customers, and the science is firmly on our side that our play has a very synergistic benefit and some of these other additives that have been known to help for years and years. So we're very excited about the future of our Amlan International Group, and if you sense a little disconnect and how this call is going, it's because Mike and I are in Latin America. Bunch of them are in Chicago and I think someone else is actually dialing in from somewhere too, but maybe I'm wrong.
But anyway let's open up the call to Q&A. As always ask your most important question first and then get to the end of the queue. This allows everyone the chance to ask at least one question and let's go from here.