Cyanotech second quarter revenues increase to $5,989,000

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 2012, ended September 30, 2011.

“We're pleased with our progress on key measures in the second quarter compared to the second quarter of fiscal 2011”

Second Quarter 2012

For the second quarter of fiscal 2012 compared to the second quarter of fiscal 2011, revenues were $5,989,000 compared to $3,834,000. Gross profit was $2,790,000, with gross profit margin of 47%, compared to gross profit of $1,652,000 and gross profit margin of 43%. Net income was $875,000 or $0.16 per diluted share, compared to net income of $526,000 or $0.10 per diluted share.

Six Months 2012

For the first six months of fiscal 2012 compared to the first six months of fiscal 2011, revenues were $11,939,000 compared to $7,690,000. Gross profit was $4,894,000, with gross profit margin of 41%, compared to gross profit of $3,311,000 and gross profit margin of 43%. Net income was $1,361,000 or $0.25 per diluted share, compared to net income of $925,000 or $0.17 per diluted share.

Trailing 12 Months

For the trailing 12 months ended September 30, 2011, compared to the trailing 12 months ended September 30, 2010, revenues were $21,076,000 compared to revenues of $15,486,000. Gross profit was $7,924,000, with gross profit margin of 38%, compared to gross profit of $6,449,000 and gross profit margin of 42%. Net income was $2,166,000 or $0.40 per diluted share, including a non-cash tax benefit of $552,000 due to a reduction in the deferred tax valuation allowance and recording of a net deferred tax asset in the fourth quarter of fiscal 2011, compared to $1,304,000, or $0.26 per diluted share. Income before the income tax benefit was $1,623,000 compared to $1,326,000.

Commenting on the second quarter results, Brent Bailey, President and CEO, said "We're pleased with our progress on key measures in the second quarter compared to the second quarter of fiscal 2011:

• Net sales reached a record $5,989,000 (+$2,155,000 and +56%)
• Gross margin increased to 46.6% (+3.5 pts.)
• Net Income grew to $875,000 (+$349,000 and +66%)
• Cash increased to $4,091,000 (+$3,308,000 and +422%)
• Inventory declined to $3,188,000 (-$1,425,000 and -31%)

In addition, our Nutrex-branded sales grew 73% and represented 37% (+3 pts.) of our net sales."

For the second quarter of fiscal 2011, Spirulina sales accounted for 40% of total revenues and natural Astaxanthin sales for 60%. International sales were 27% of total sales.