Martek revenues up 30pc on sales of branded consumer products
The company posted total revenues for the fourth quarter ended October 31, 2010 at $119.1m; up 36 per cent on the same period of last year.
Revenue and earnings for the fourth quarter include the results of Amerifit Brands and revenue and earnings for the full year fiscal 2010 include the results of Amerifit since the February 12, 2010 date on which Martek acquired the company.
Steve Dubin, Martek’s chief executive officer said, "Revenue grew across all business segments in 2010, our core infant formula ingredients business was strengthened through the extension of the terms of two of our key infant formula sole source supply agreements, and significant improvements on the operational side of the business were implemented which helped drive growth in both margins and income.
“In addition, we expanded our business platform through the acquisition of Amerifit, and made significant progress on our product and technology pipeline, both of which provide Martek with exciting opportunities for future growth."
Martek generated cash flow from operations of $46.3m and $146m respectively, for the fourth quarter and full year 2010. It ended fiscal 2010 with a cash balance of $63.7m, no debt, and its $100m credit line available since paying off the $86m of acquisition-related debt in the third quarter of 2010.
Fourth quarter sales reached $117.6m, up 44 per cent compared with the fourth quarter of fiscal 2009.
For the full year 2010, product sales increased 32 per cent to $434.8m reflecting the growth in sales of branded consumer health products resulting from the acquisition of Amerifit.
Fourth quarter infant formula sales growth resulted mainly from increased sales of ARA and DHA for use in international markets.
Gross margin for the fourth quarter of fiscal 2010 was 52 per cent compared with the 44 per cent gross margin achieved in the fourth quarter of fiscal 2009.
The full year gross margin was 48%, an increase from the 43% gross margin realized for the full year 2009.
Consumer health products
Both improvements reflected cost reductions for ARA and DHA plus the positive impact of higher gross margins on sales of branded consumer health products.
Research and development (R&D) expenses for the fourth quarter of fiscal 2010 were $9.2m representing 8 per cent of sales.
R&D expenses for the full year reached $33.6m, up from $27.4m in fiscal 2009. The company’s R&D programme focuses on broadening the market applications for life'sDHA through new product and process innovations.
Martek is also developing its microbial technology platform to develop new product offerings for its core nutritional markets and new high-value opportunities beyond nutrition.