Cyanotech sales climb


POSTED: Friday, November 13, 2009

Cyanotech Corp., a producer of human nutritional products from microalgae, posted a 267 percent increase in fiscal second-quarter earnings as sales improved for its two core products.

The Kona-based company said yesterday that demand for Spirulina Pacific and BioAstin Natural Astaxanthin for the period ended Sept. 30 helped boost revenue 20 percent to $3.9 million from $3.3 million a year ago, while its gross profit margin — what's left after deducting the cost of the product — improved to 45 percent from 42 percent.

Net income rose to $599,000, or 11 cents a share, from $163,000, or 3 cents a share.

Cyanotech's stock surged 20.2 percent, or 46 cents, to $2.74 yesterday to bring its gain for the year to 87.7 percent, the best of any Hawaii-based company.

“;These results affirm the company's strategy of focusing on and building sound business fundamentals throughout the organization,”; said Andy Jacobson, president and chief executive officer of Cyanotech. “;Improved production levels increased inventory, allowing better customer service. Continued cost containment delivered margin growth. Sustained high quality continued our nutritional leadership, and our dedicated employees made it all possible.”;





Second-quarter net
        Year-earlier net


Spirulina has more than 100 nutrients, including protein, and “;is like nature's multivitamin,”; Jacobson said. “;It's good for general health. If you take three grams of Spirulina a day, it's the same antioxidant value of five servings of fruit and vegetables.”;

BioAstin is a dietary supplement with antioxidant and other health benefits, including the support of healthy joints and ultraviolet protection.

Jacobson, who has been with Cyanotech for about 18 months, said the company is now focusing on its new Nutrex branding, which is Cyanotech's brand packaged under its own label. The company has been selling most of its products outside Hawaii to other brand owners to use in those companies' products.

“;Our main objective is to produce the highest-quality product possible,”; he said. “;In this economy you also have to have cost containment and cost-reducing programs in place to get the appropriate margin growth. Increased productivity also contributes to the margin, and we're able to make enough product now to fill demand. That's been a problem in the past with the company.”;