Cyanotech posts
a winning year
Cyanotech Corp., providing further evidence that it has turned the corner, posted its second winning quarter in a row to finish with a profitable year for the first time since fiscal 1997.
The Kona-based company, which makes human nutritional and animal feed products from microalgae, had net income of $441,000, or 2 cents a share, in its fiscal 2004 fourth quarter that ended March 31. A year ago, Cyanotech posted a loss of $270,000, or 1 cent a share.
Net sales in the quarter jumped 35.6 percent to $3.3 million from $2.4 million a year earlier.
For fiscal 2004, Cyanotech swung to a net profit of $399,000, or 2 cents a share, from a loss of $1.8 million, or 10 cents a share, in fiscal 2003. Annual revenues rose 29.4 percent to $11.6 million from $9 million.
"Throughout fiscal 2004, our continued focus on marketing and productivity has resulted in sequential sales growth, improved gross margins, increased cash balances and profitability," said Gerald Cysewski, chairman, president and chief executive officer of Cyanotech.
Cyanotech had suffered through 22 straight losing quarters until ending the drought with a $109,000 profit in the quarter that ended Dec. 31. The March quarter's earnings enabled the company to end its fiscal year profitable as well.
It's been a difficult climb to profitability for Cyanotech, which ended fiscal 1997 with record net income of $4.2 million and record sales of $11.4 million. Its fortunes soured in June 1997 -- the fiscal 1998 year -- when its largest customer was forced out of business. The Hong Kong-based customer, which represented 30 percent of Cyanotech's sales, had been selling the nutritional supplement Spirulina through a multilevel organization in mainland China when the Chinese government abruptly outlawed multilevel marketing.
Today, NatuRose and BioAstin are driving the company's sales. NatuRose gives fish farmers the ability to grow pink-fleshed salmon and other fish using a natural substance rather than synthetic pigmentation. BioAstin contains natural astaxanthin, an antioxidant that has been shown to have health benefits.
Cyanotech's cash position also strengthened throughout the year as the company ended fiscal 2004 with working capital of $4.1 million compared with $2.4 million a year ago. Cash and cash equivalents improved to $2.5 million from $579,000 a year ago.
