Cyanotech Corporation (NASDAQ:CYAN) Q3 2024 Earnings Call Transcript

Cyanotech Corporation (NASDAQ:CYAN) Q3 2024 Earnings Call Transcript February 12, 2024

Cyanotech Corporation isn’t one of the 30 most popular stocks among hedge funds at the end of the third quarter (see the details here).

Matt Custer: Aloha from Kona, Hawaii. Thank you all for joining us today. I'm Matt Custer, President and Chief Executive Officer of Cyanotech. Joining me on the call today is Felicia Ladin, our Chief Financial Officer. I will turn the call over to Felicia to provide our forward-looking statement.

Felicia Ladin: Thanks, Matt. Our discussion today may include forward-looking statements. We do not undertake any obligation to update forward-looking statements, either as a result of new information, future events or otherwise. Our actual results may differ materially from what is described in these forward-looking statements. Some of the factors that may cause results to differ are listed in our publicly filed documents. For additional information, we encourage you to review our 10-Q and fiscal year 2023 and 10-K report filed with the Securities and Exchange Commission. I will turn it back to Matt for comments on the quarter. Matt?

A customer satisfied with their purchase of the company's dietary supplements.

Matt Custer: The macroeconomic environment led to lower sales across the portfolio on a year-to-date basis being driven particularly by Spirulina bulk sales. Industry data shows consumers are not pulling back from dietary supplements, but they have begun trading down the private label brands to save on cost. The market for bulk material is increasingly price-sensitive with many companies sourcing lower-priced international ingredients. In the face of these challenges, we have revitalized our sales and marketing team, starting with the addition of a Chief Commercial Officer this past August and strengthening the sales team. We have focused on enhancing our consumer message on our premium quality and competitive advantages. Our naturally formed microalgae from our location in Hawaii with pristine waters and natural sourcing practices aligns with rising consumer objectives and growing demand for responsible, sustainable and U.S. grown products.

Now I'd like to turn over the call to Felicia to discuss the third quarter. Felicia, please?

Felicia Ladin: Thank you, Matt, and good evening, everyone. Net sales for the third quarter of fiscal year 2024 were $5,582,000 compared to $5,891,000 for the third quarter of fiscal year 2023 and a decrease of 5% due to the reasons Matt mentioned. Gross profit for the third quarter of fiscal year 2024 was $1,649,000, with a gross profit margin of 29.5% and compared to gross profit of $1,764,000 and a gross profit margin of 29.9% in the third quarter of fiscal year 2023. Operating loss for the third quarter was $848,000 compared to operating loss of $404,000 last year, reflecting a decrease of $404,000 due to lower sales and higher manufacturing costs as a result of matching production volumes with demand, which is lower than historical levels.

See also 20 Cities with the Highest Quality of Life in the US and 25 Largest Economies in the World by 2040.

To continue reading the Q&A session, please click here.