Cyanotech Corporation (Nasdaq Capital Market: CYAN), a world leader in microalgae-based, high-value nutrition and health products, today announced financial results for the fourth quarter and fiscal year 2012, ended March 31, 2012. Fiscal Year 2012 For fiscal year 2012 compared to fiscal year 2011, revenues were $24,631,000 compared to $16,827,000. Gross profit was $9,774,000, with gross profit margin of 39.7%, compared to gross profit of $6,341,000 and gross profit margin of 37.7%. Net income was $3,632,000 or $0.66 per diluted share, compared to net income of $1,730,000 or $0.32 per diluted share. Highlighting the fiscal year 2012 results, Brent Bailey, President and CEO, noted:
- Net sales increased $7.8 million or 46.4% over the prior year to a record $24.6 million, driven primarily by an increase in demand for astaxanthin products.
- Gross margin increased to 39.7% from 37.7%, aided by the growth in higher margin astaxanthin sales.
- Operating income increased $1.7 million or 136% to $2.9 million, driven by the net sales growth.
- Net income increased $1.9 million or 110% to $3.6 million, driven by the volume increase and a partial reversal of the valuation allowance on our deferred tax asset.
- Earnings per diluted share increased $0.34 to $0.66.
- Cash from operating activities increased $3.3 million to $5.1 million, resulting from the increased volume and non-cash items such as stock option compensation and increases in accounts payable and accrued expenses.
- Cash and cash equivalents at March 31, 2012 increased $3.0 million to $5.1 million. As a result, working capital increased $1.8 million or 29% to $8.1 million at March 31, 2012.
For the year, spirulina sales accounted for 35% of total revenues and natural astaxanthin sales for 65%. International sales were 33% of total sales.Mr. Bailey commented, “We are pleased with our business results and made significant progress in improving our processes, systems, facilities and organization in fiscal 2012. We are focused on continuing to strengthen our infrastructure to support the substantial growth we expect to generate for the foreseeable future.” Vice President and CFO Jolé Deal commented that “as part of strengthening our foundation, we’ve made significant improvements in the effectiveness of our internal controls and procedures. As a result, the material weakness that had been identified in previous years no longer exists.” Fourth Quarter 2012 For the fourth quarter of fiscal 2012 compared to the fourth quarter of fiscal 2011, revenues were $5,986,000 compared to $5,218,000. Gross profit was $2,053,000, with gross profit margin of 34.3%, compared to gross profit of $1,798,000 and gross profit margin of 34.5%. Net income was $1,158,000 or $0.20 per diluted share, compared to net income of $795,000 or $0.14 per diluted share. Net income for the fourth quarter included a reversal of the valuation allowance on our deferred tax asset of $892,000 in the current year and $552,000 last year. 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 its 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 Association TM . 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-K for the period ended March 31, 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)|
|(in thousands, exceptshare data)|
|Cash and cash equivalents||$||5,061||$||2,062|
|Accounts receivable, net of allowance for doubtful accounts of $16 in 2012 and $58 in 2011||2,373||2,641|
|Deferred tax assets||137||17|
|Prepaid expenses and other current assets||300||134|
|Total current assets||11,419||8,481|
|Equipment and leasehold improvements, net||5,834||4,557|
|Deferred tax assets||1,307||535|
|LIABILITIES AND STOCKHOLDERS’ EQUITY|
|Current maturities of long-term debt||$||234||$||204|
|Total current liabilities||3,361||2,196|
|Long-term debt, excluding current maturities||400||553|
|Commitments and contingencies|
|Common stock of $0.02 par value, authorized 7,500,000 shares; issued and outstanding 5,440,968 shares at 2012 and 5,395,168 shares at 2011||109||108|
|Additional paid-in capital||28,324||27,803|
|Total stockholders’ equity||15,265||11,111|
|Total liabilities and stockholders’ equity||$||19,038||$||13,860|
|CYANOTECH CORPORATION AND SUBSIDIARY|
|CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS|
|(Dollars in thousands, except per share amounts)|
|Year ended March 31,|
|(in thousands, except per share data)|
|Cost of sales||14,857||10,486||9,109|
|General and administrative||4,014||2,822||3,311|
|Sales and marketing||2,480||1,986||1,402|
|Research and development||320||282||264|
|Loss on disposal of equipment and leasehold improvements||57||22||155|
|Total operating expense||6,871||5,112||5,132|
|Income from operations||2,903||1,229||1,501|
|Other income (expense):|
|Interest expense, net||(55||)||(70||)||(109||)|
|Other income, net||5||4||23|
|Total other expense, net||(50||)||(66||)||(86||)|
|Income before income tax benefit (expense)||2,853||1,163||1,415|
|Income tax benefit (expense)||779||567||(24||)|
|Net income per share:|
|Shares used in calculation of net income per share:|