Neptune reports year of growth and reduced losses
profitability after a full year 2005 in which it increased sales of
ingredient from marine biomasses by 45 per cent and slashed
operating losses by 50 per cent, compared to the previous twelve
months.
The Canadian company has reported sales of C$7.29m for the year ended May 31 2006, and net loss of $0.89m ($0.029 per share), from losses of $1.77m ($0.069 per share) last year.
It is a set of results that it said gives it confidence that it will reach the level of sales required to meet objective of operational profitability, and enable it to generate new sources of revenue within new markets.
In addition to consolidating its presence in existing US and Asian markets, it is looking forward to greater penetration in Europe, where its previously stated target is functional foods, and entry into new ones such as Australia.
Neptune uses a cold-processing technological platform to extract an oil from krill (a planktonic family of crustaceans), known as Neptune Krill Oil or NKO, that is loaded with omega-3 fatty acids, phospholipids and antioxidants. It also offers a marine protein concentrate called Neptune Krill Aquatein that boasts over 80 per cent purity and contains a mix of amino acids, digestive enzymes, and peptides.
Not only is the company conducting R&D with the end of improving the extraction process and applying it to more marine species (especially those that are presently under- or un-exploited), but also to develop products for other applications.
It is basing its plan for growth on new strategic alliances to exploit certain rights to NKO, and the development and commercialisation of new products.
At its facility in Sherbrooke, Neptune's full capacity is 60,000kg of NKO and 300,000kg of protein concentrates per year. It is not known what proportion of this it is presently using, but part of its 2006/2007 action plan is to gradually increase monthly production and improve productivity.
Neptune's recent marketing strategy for NKO has been to sell the processing rights for it to be used in the high-growth nutraceutical and biopharmaceutical markets - the former emerging market being used as a transitory step towards the latter, which is more established and profitable.
It has also said that, in the short to medium term, it intends to penetrate the cosmeceutical and nutrigenomics markets.
The company has said it plans to continue conducting clinical studies to validate applications of its products and new formulations.
"It is of critical importance for Neptune that the Company maintain a very active role in addressing this scientific challenge [of supporting research into the benefits of its products for human health] and in validating each of the components and compounds found in its products."
Results have been reported on NKO's applications for skin cancer prevention, premenstrual syndrome management, hyperlipidemia regulation, and anti-inflammatory properties.
Other studies currently underway in collaboration with research institutions are investigating its uses for Attention Deficit Disorder and Hyperactivity and Hypercholesterolemia.
