Landec Corporation F4Q10 (Qtr Ended 05/30/2010) Earnings Call Transcript

The non-cash impairment charge represents Landec's best estimate of the net realizable value of this investment in Aesthetic Sciences in light of the expected royalty stream associated with the technology sale. This does not affect Landec's cash in anyway,

Our remaining $800,000 investment in the Aesthetic Sciences will be periodically reviewed for possible additional impairment.

Turning to our fourth quarter of fiscal year 2010 results, revenues increased over 10% compared to the year ago quarter. Relative to the prior three quarters in fiscal year 2010 we improved our overall gross profit and gross margin. We are starting to see improvements in the fresh cut produce industry volume sales but victory should not yet be declared.

Pricing pressured continue as retailers continue to struggle with consumers' tight budgets. Also during the fourth quarter, we completed our acquisition of Lifecore. We also shipped large numbers of BreatheWay membrane for Chiquita's Avocado roll out. We advanced our technical work with Monsanto on seed coatings. We've launched new products with Air Products in the personal care field, including adding several new customers and we advanced our technology licensing discussions with several strategic partners as well as concluding and announcing a recent agreement with Windset Farms.

Let me turn it over to Greg Skinner to discuss the specifics of our results.

Greg Skinner

Thank you, Gary. Good morning, everyone. As outlined in yesterday's new release, Landec reported total revenues for fiscal year 2010 of $238 million versus revenues of $236 million for the same period a year ago.

The increase in total revenues during fiscal year 2010 was due to a $6.8 million or 4% increase in revenues from Apio's value added vegetable business, and from $1.5 million of revenues generated by Lifecore in the month of May. These increases were partially offset by $5.5 million or 9% decrease in revenues from Apio's commodity trading business.

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