Cyanotech Reports Financial Results for the First Quarter of Fiscal 2022

KAILUA KONA, Hawaii--(BUSINESS WIRE)--Cyanotech Corporation (Nasdaq Capital Market: CYAN), a world leader in microalgae-based, high-value nutrition and health dietary supplement products, announced financial results for the first quarter of fiscal year 2022, ended June 30, 2021.

First Quarter Fiscal 2022

Cyanotech reported net sales of $8,964,000 for the first quarter of fiscal 2022 compared to $7,352,000 for the first quarter of fiscal 2021, an increase of 22%. Gross profit was $3,672,000, with gross profit margin of 41.0%, compared to gross profit of $2,975,000, with gross profit margin of 40.5%. Operating income for the first quarter of fiscal 2022 was $619,000 compared to $268,000 in the same period of the prior year.

Net income for the current fiscal quarter was $520,000, or $0.08 per diluted share, compared to net income of $138,000, or $0.02 per diluted share, for the same period of the prior year.

Commenting on the first quarter fiscal 2022 results, Cyanotech’s Chief Executive Officer, Gerald R. Cysewski, Ph.D., said: “We had a good start to the year with strong sales and an improvement in gross profit margin. Climatic conditions were generally stable during the first quarter on Hawaii Island, and we saw cultivation and production metrics above trend.”

Trailing Twelve Months

For the trailing twelve months ended June 30, 2021, compared to the trailing twelve months ended June 30, 2020, net sales were $33,957,000 compared to $31,179,000. Gross profit was $11,813,000, with gross profit margin of 34.8%, compared to $11,999,000 and 38.5%. Net income was $1,302,000, or $0.21 per diluted share, which included $1,389,000 for the forgiveness of the loan under the Paycheck Protection Program, compared to net income of $659,000, or $0.11 per diluted share.

Please review the Company’s Form 10-Q for the period ended June 30, 2021 for more detailed information.

— Cyanotech will host a virtual broadcast at 8:00 PM EDT on Thursday, August 12, 2021 to respond to questions about its operating results and other topics of interest. Interested parties are asked to submit questions to [e-mail] before 12 p.m. (noon) EDT on Thursday, August 12, 2021. The Company will respond only to relevant questions relating to the Company’s first quarter fiscal 2022 financial performance and will not be accepting any questions or comments during the broadcast.

To join the broadcast, please browse http://cyanotech.com/meet approximately five minutes prior to the start time.

About Cyanotech — Cyanotech Corporation, a world leader in microalgae technology for more than 30 years, produces BioAstin® Hawaiian Astaxanthin® and Hawaiian Spirulina Pacifica®. These all-natural, dietary ingredients and supplements leverage our experience and reputation for quality, building nutritional brands which promote health and well-being. The Company’s mission is to fulfill the promise of whole health through Hawaiian microalgae. Cyanotech’s BioAstin® offers superior antioxidant activity which supports skin, eye and joint health, as well as recovery from exercise*. Cyanotech's Spirulina products offer nutrition that supports cardiovascular health and immunity*. All Cyanotech products are produced from microalgae grown at our 96-acre facility in Kona, Hawaii using patented and proprietary technology and are Generally Recognized as Safe (“GRAS”) for use in food products. Cyanotech sells its products direct to consumers at retail locations in the United States and online at www.nutrex-hawaii.com and also distributes to dietary supplement, nutraceutical and cosmeceutical manufacturers and marketers. The Company is regulated by the Food and Drug Administration. Visit www.cyanotech.com for more information.

*These statements have not been evaluated by the Food and Drug Administration. This product is not intended to diagnose, treat, cure or prevent any disease.

“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 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 first quarter fiscal 2022 ended June 30, 2021, which can be found on the Cyanotech website (www.cyanotech.com) under Investors>Investor Filings upon filing. As such, the following Financial Tables are provided only as a guide and other factors are more fully detailed in the Company’s annual Form 10-K filings with the Securities and Exchange Commission.

CYANOTECH CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except per share amounts)
(Unaudited)
	June 30, 2021			March 31, 2021
ASSETS
Current assets:
Cash	$	1,061		$	3,767
Accounts receivable, net of allowance for doubtful accounts of $75 as of June 30, 2021 and $32 as of March 31, 2021		5,036			2,436
Inventories, net		9,234			8,415
Prepaid expenses and other current assets		374			488
Total current assets		15,705			15,106
Equipment and leasehold improvements, net		11,905			12,136
Operating lease right-of-use assets, net		3,435			3,517
Other assets		122			120
Total assets	$	31,167		$	30,879
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	2,471		$	2,287
Accrued expenses		1,133			844
Customer deposits		156			124
Operating lease obligations, current portion		348			343
Line of credit		1,000			1,000
Current maturities of long-term debt		720			1,210
Total current liabilities		5,828			5,808
Long-term debt, less current maturities		4,647			4,823
Long-term operating lease obligations		3,085			3,175
Other long-term liabilities		28			32
Total liabilities		13,588			13,838
Commitments and contingencies
Stockholders’ equity:
Preferred stock of $0.01 par value, authorized 10,000,000 shares; no shares issued and outstanding		—			—
Common stock of $0.02 par value, authorized 50,000,000 shares; issued and outstanding 6,117,719 shares at June 30, 2021 and 6,116,073 shares at March 31, 2021		122			122
Additional paid-in capital		33,285			33,267
Accumulated deficit		(15,828	)		(16,348	)
Total stockholders’ equity		17,579			17,041
Total liabilities and stockholders’ equity	$	31,167		$	30,879

CYANOTECH CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)
	Three Months Ended June 30,
	2021			2020
Net sales	$	8,964		$	7,352
Cost of sales		5,292			4,377
Gross profit		3,672			2,975
Operating expenses:
General and administrative		1,347			1,328
Sales and marketing		1,550			1,244
Research and development		156			135
Total operating expenses		3,053			2,707
Income from operations		619			268
Interest expense, net		(95	)		(131	)
Income before income taxes		524			137
Income tax expense (benefit)		4			(1	)
Net income	$	520		$	138
Net income per share:
Basic	$	0.09		$	0.02
Diluted	$	0.08		$	0.02
Shares used in calculation of net income per share:
Basic		6,117			6,029
Diluted		6,293			6,036