Cyanotech posts profit as revenue jumps 43%
, a Kona-based nutritional products company, said yesterday that higher spirulina and natural astaxanthin sales helped it post its second profitable quarter in more than a year.
Net income for the quarter ending June 30 was $271,000, or 5 cents a share, compared to a loss of $382,000, or 7 cents a share, a year earlier. Revenue was up 43 percent to $3.7 million from $2.6 million.
Cyanotech is coming off its third-straight annual loss for the fiscal year that ended March 31, but the company had a fourth-quarter profit of $181,000. Last year, the company delayed earnings results several times due to an internal accounting probe and also laid off about 20 percent of its 64 full-time employee work force shortly after Gerald Cysewski, Cyanotech's founder, stepped down as chairman, president and chief executive officer.
The company grows and processes microalgae into finished products at its 90-acre Big Island facility.
Spirulina sales increased by one-third in the fiscal first quarter to $2 million from $1.5 million last year, while natural astaxanthin product sales rose 63 percent to $1.6 million from $997,000. Bulk and packaged product sales increased while prices rose "only slightly," according to Cyanotech's regulatory filing.
"The company is now focused on building market share based on nutritional brands which promote health and well-being," the filing stated. Last year, Cyanotech discontinued a wholly owned Japanese subsidiary because of poor sales of NatuRose, an astaxanthin used in animal feeds.
Cyanotech said it expects spirulina sales to remain flat since a portion of the upward trend in sales is attributable to filling orders it could not fill during the third and fourth quarters of last year due to insufficient inventory. International sales were 41 percent of total sales for the first quarter of fiscal year 2009 and 2008.
Operating expenses for the quarter were 27 percent of sales, or $1 million, compared to 42 percent of sales, or $1.1 million, a year earlier from sales and marketing expense reductions
Variable production costs increased 5 percent in the quarter from a year ago from electrical rates, which have jumped 31 percent, and from the shipping costs of chemicals used in production. Fixed costs declined by 9 percent due to production equipment becoming fully depreciated.
Cash and cash equivalents at June 30 totaled $1.1 million, an increase of $9,000 from March 31.
At June 30, the company had an accumulated deficit of $20.8 million compared to $21.1 million in the prior quarter.