Cyanotech Reports Financial Results for the Second Quarter and First Six Months of Fiscal 2013
Cyanotech Reports Financial Results for the Second Quarter and First Six Months of Fiscal 2013
KAILUA KONA, Hawaii--(BUSINESS WIRE)-- Cyanotech Corporation (Nasdaq Capital Market: CYAN), a world leader in microalgae-based, high-value nutrition and health products, today announced financial results for the second quarter and first six months of fiscal year 2013, ended September 30, 2012.
Second Quarter 2013
For the second quarter of fiscal 2013 compared to the second quarter of fiscal 2012, revenues were $6,936,000 compared to $5,989,000, an increase of 16%. Gross profit was $2,812,000, with gross profit margin of 40.5%, compared to gross profit of $2,790,000 and gross profit margin of 46.6%. Net income was $476,000 or $0.08 per diluted share, compared to net income of $875,000 or $0.16 per diluted share.
Commenting on the second quarter fiscal 2013 results, Brent Bailey, President and CEO, noted: "We are pleased with the record net sales of $6,936,000 in the second quarter and growth of 16%, including a 46% increase in our US branded consumer business and 36% in our bulk astaxanthin business. Our market shares of both spirulina and astaxanthin in the natural products distribution channel were above 40% and growing in the most recent 12-week period. However, this solid net sales growth was offset by the following factors, resulting in a net income decline:
Planned addition of new employees to build our capabilities
Planned increase in marketing spending to drive our consumer products business
Lower spirulina production, resulting in abnormal costs of $481,000 for the quarter, due to difficulties in harvesting smaller cell sizes that have proliferated over time. Our spirulina quality and nutrient levels remain high. We've taken steps to improve our harvest efficiency and our harvest level has improved and stabilized at a higher level but has not yet reached targeted levels.
"The shift in mix from spirulina to astaxanthin and from bulk to retail sales has led to year-to-date performance slightly ahead of expectations in spite of the factors listed above."
First Six Months 2013
For the first six months of fiscal 2013 compared to the first six months of fiscal 2012, revenues were $13,442,000 compared to $11,939,000, an increase of 12.6%. Gross profit was $5,386,000, with gross profit margin of 40.1%, compared to gross profit of $4,894,000 and gross profit margin of 40.0%. Net income was $969,000 or $0.17 per diluted share, compared to net income of $1,361,000 or $0.25 per diluted share.
Trailing 12 Months
For the trailing 12 months ended September 30, 2012, compared to the trailing 12 months ended September 30, 2011, revenues were $26,134,000 compared to revenues of $21,076,000, an increase of 24.0%. Gross profit was $10,266,000, with gross profit margin of 39.3%, compared to gross profit of $7,924,000 and gross profit margin of 37.6%. Net income was $3,240,000 or $0.58 per diluted share, compared to $2,166,000, or $0.40 per diluted share.
About Cyanotech — Cyanotech Corporation, a world leader in microalgae technology, produces BioAstin® Natural Astaxanthin and Hawaiian Spirulina Pacifica®—all natural, functional nutrients that leverage our experience and reputation for quality, building nutritional brands which promote health and well being. Cyanotech's Spirulina products offer complete nutrition, and augment energy and immune response. They are FDA-reviewed and accepted as Generally Recognized as Safe (GRAS) for use in food products. BioAstin's superior antioxidant activity and ability to support and maintain a natural anti-inflammatory response enhance skin, muscle and joint health. All Cyanotech products are produced from microalgae grown at our 90-acre facility in Kona, Hawaii using patented and proprietary technology. Cyanotech distributes to nutritional supplement, nutraceutical and cosmeceutical manufacturers and marketers in more than 54 countries worldwide. Cyanotech was the first microalgae company in the world to obtain quality management standards ISO 9001:2000 certification and is GMP-certified by the Natural Products AssociationTM. Visit www.cyanotech.com for more information.
"Safe Harbor" Statement under the U.S. Private Securities Litigation Reform Act of 1995 Besides statements of present fact and historical fact, this press release may contain forward-looking statements. Forward-looking statements relate to the future and are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. Our actual results may differ materially from those contemplated by forward-looking statements. We caution against relying on forward-looking statements. Important factors that could change actual, future results include: changes in sales levels to our largest customers, weather patterns in Hawaii, production problems, risks associated with new products, foreign exchange fluctuations, and availability of financing, as well as national and global political, economic, business, competitive, market and regulatory conditions. Other factors are more fully detailed in the Company's recent Form 10-Q and annual Form 10-K filings with the Securities and Exchange Commission.
(Financial Tables Follow: The following tables do not contain footnotes or other information contained in the Company's Form 10-Q for the period ended September 30, 2012. As such the following Financial Tables are provided only as a guide and other factors are more fully detailed in the Company's Form 10-Q and annual Form 10-K filings with the Securities and Exchange Commission.)
CYANOTECH CORPORATION AND SUBSIDIARY | ||||||||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||||||||
(Dollars in thousands except par value and number of shares) | ||||||||||||||
(Unaudited) | ||||||||||||||
Sept. 30, | March 31, | |||||||||||||
2012 | 2012 | |||||||||||||
ASSETS | ||||||||||||||
Current assets: | ||||||||||||||
Cash and cash equivalents | $ | 3,603 | $ | 5,061 | ||||||||||
Accounts receivable, net of allowance for doubtful accounts of $6 | ||||||||||||||
at September 30, 2012 and $16 at March 31, 2012 | 3,818 | 2,373 | ||||||||||||
Inventories, net | 3,357 | 3,548 | ||||||||||||
Deferred tax assets | 137 | 137 | ||||||||||||
Prepaid expenses and other current assets | 268 | 300 | ||||||||||||
Total current assets | 11,183 | 11,419 | ||||||||||||
Equipment and leasehold improvements, net | 6,704 | 5,834 | ||||||||||||
Restricted cash | 2,250 | — | ||||||||||||
Deferred tax assets | 1,307 | 1,307 | ||||||||||||
Other assets | 759 | 478 | ||||||||||||
Total assets | $ | 22,203 | $ | 19,038 | ||||||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||||||
Current liabilities: | ||||||||||||||
Current maturities of long-term debt | $ | 60 | $ | 234 | ||||||||||
Customer deposits | 43 | 49 | ||||||||||||
Accounts payable | 2,176 | 1,726 | ||||||||||||
Accrued expenses | 971 | 1,352 | ||||||||||||
Total current liabilities | 3,250 | 3,361 | ||||||||||||
Long-term debt, excluding current maturities | 2,310 | 400 | ||||||||||||
Deferred rent | 15 | 12 | ||||||||||||
Total liabilities | 5,575 | 3,773 | ||||||||||||
Commitments and contingencies | ||||||||||||||
Stockholders' equity: | ||||||||||||||
Common stock of $0.02 par value, shares authorized 50,000,000; | ||||||||||||||
5,463,488 shares issued and outstanding at September 30, 2012 | ||||||||||||||
and 5,440,968 shares at March 31, 2012 | 109 | 109 | ||||||||||||
Additional paid-in capital | 28,718 | 28,324 | ||||||||||||
Accumulated deficit | (12,199 | ) | (13,168 | ) | ||||||||||
Total stockholders' equity | 16,628 | 15,265 | ||||||||||||
Total liabilities and stockholders' equity | $ | 22,203 | $ | 19,038 | ||||||||||
CYANOTECH CORPORATION AND SUBSIDIARY | ||||||||||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||||||||||
(Dollars in thousands, except per share amounts) | ||||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||||||||||
NET SALES | $ | 6,936 | $ | 5,989 | $ | 13,442 | $ | 11,939 | ||||||||||||||||
COST OF SALES | 4,124 | 3,199 | 8,056 | 7,045 | ||||||||||||||||||||
Gross profit | 2,812 | 2,790 | 5,386 | 4,894 | ||||||||||||||||||||
OPERATING EXPENSES: | ||||||||||||||||||||||||
General and administrative | 1,285 | 1,117 | 2,433 | 2,065 | ||||||||||||||||||||
Sales and marketing | 880 | 609 | 1,718 | 1,176 | ||||||||||||||||||||
Research and development | 80 | 89 | 131 | 160 | ||||||||||||||||||||
Loss on disposal of equipment and | ||||||||||||||||||||||||
leasehold improvements | 13 | 62 | 35 | 64 | ||||||||||||||||||||
Total operating expenses | 2,258 | 1,877 | 4,317 | 3,465 | ||||||||||||||||||||
Income from operations | 554 | 913 | 1,069 | 1,429 | ||||||||||||||||||||
OTHER EXPENSE: | ||||||||||||||||||||||||
Loss on extinguishment of debt | (51 | ) | — | (51 | ) | — | ||||||||||||||||||
Interest expense, net | (17 | ) | (10 | ) | (29 | ) | (24 | ) | ||||||||||||||||
Total other expense, net | (68 | ) | (10 | ) | (80 | ) | (24 | ) | ||||||||||||||||
Income before provision for income taxes | 486 | 903 | 989 | 1,405 | ||||||||||||||||||||
PROVISION FOR INCOME TAXES | (10 | ) | (28 | ) | (20 | ) | (44 | ) | ||||||||||||||||
NET INCOME | $ | 476 | $ | 875 | $ | 969 | $ | 1,361 | ||||||||||||||||
NET INCOME PER SHARE: | ||||||||||||||||||||||||
Basic | $ | 0.09 | $ | 0.16 | $ | 0.18 | $ | 0.25 | ||||||||||||||||
Diluted | $ | 0.08 | $ | 0.16 | $ | 0.17 | $ | 0.25 | ||||||||||||||||
SHARES USED IN CALCULATION OF NET INCOME PER SHARE: | ||||||||||||||||||||||||
Basic | 5,450 | 5,398 | 5,445 | 5,397 | ||||||||||||||||||||
Diluted | 5,635 | 5,473 | 5,758 | 5,471 | ||||||||||||||||||||
for Cyanotech Corporation
Bruce Russell, 310-559-4955 x101
brussell@cyanotech.com
KEYWORDS: United States North America Hawaii
INDUSTRY KEYWORDS:
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