Cyanotech posts third
profitable quarter

Cyanotech Corp., coming off its first profitable year since 1997, posted its third consecutive winning quarter but saw production drop off significantly from the previous three-month period due to heavy rains.

The Kona-based company, which makes human nutritional and animal feed products from microalgae, swung to a gain of $113,000, or 1 cent a share in its first quarter that ended June 30 from a net loss of $141,000, or 1 cent a share, a year ago. Net sales rose 11.5 percent to $2.7 million from $2.4 million a year earlier.

A nutrient imbalance in the company's culture ponds hurt production of dietary supplement Spirulina and resulted in the company's overall sales falling $583,000 from $3.3 million in the previous quarter.

Gerald Cysewski, chairman, president and chief executive officer of Cyanotech, gave the quarter a mixed review.

"While we are disappointed with the quarter's results that mark a departure from our recent trend of sequential quarterly increases in revenue and net income, we are encouraged with the progress we have made from a year ago," he said.

"Compared to the first quarter of the prior fiscal year, we have increased revenues, maintained control of our expenses and recorded net income."

Cyanotech, which suffered through 22 straight losing quarters before turning profitable last year, said its cash and cash equivalents fell $90,000 to $2.4 million from the previous quarter while its working capital grew $191,000 from the previous three months to $4.3 million.