Cyanotech Reports Financial Results for the Fourth Quarter and Fiscal Year 2022

KAILUA KONA, Hawaii, June 22, 2022– (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 fourth quarter and fiscal year 2022, ended March 31, 2022.

Commenting on the fiscal year results (changes shown vs. fiscal 2021), Cyanotech’s Chief Executive Officer Emeritus and Chief Scientific Officer, Gerald R. Cysewski, Ph.D., said:

“Net sales increased to $ 36.0 million in the fiscal year, 11.2% over the prior year, with an improved gross profit as a result of lower cost of spirulina due to higher production volumes and astaxanthin as a result of production efficiencies. We generated $ 2.4 million in cash from operations, deleveraged the Balance Sheet by $ 1.7 million and invested over $ 1.0 million in capital expenditures. “

“Two new solar power systems were installed in our facility continuing Cyanotech’s commitment to renewable energy. In addition to the 791 metric tons of carbon dioxide (CO2) emissions we currently offset annually with our existing solar power system, the two new systems further reduce CO2 emissions by 163 metric tons per year. “

“After 39 years with Cyanotech, I have stepped down from my position at Cyanotech as Chief Executive Officer and as a member of the Board of Directors (‘Board’) effective June 16, 2022, to have more personal time in my last years. My time at Cyanotech has been both challenging and very rewarding.I will assume the position of CEO Emeritus and remain as Chief Scientific Officer.I will be available for consultation on business strategy on an as needed basis.I want to sincerely thank shareholders and employees for their support throughout the years. “

“Matt Custer has been appointed as President and Chief Executive Officer and as a member of the Board effective June 16, 2022. Matt has been the President of the Company since May 2021. He is a very talented and insightful leader, and I am confident the company is in good hands. “

“I am honored and humbled to lead the organization and thank Gerry for creating a legacy for all of us to continue to uphold,” commented Matt Custer, President and Chief Executive Officer.

Fiscal Year 2022

Cyanotech reported net sales of $ 35,968,000 for fiscal 2022 compared to $ 32,345,000 in fiscal 2021, an increase of 11.2%. Gross profit was $ 13,566,000, with gross profit margin of 37.7%, compared to gross profit of $ 11,117,000 and gross profit margin of 34.4%. Operating income was $ 2,574,000 compared to operating income of $ 84,000.

Net income was $ 2,154,000 or $ 0.35 per diluted share, compared to net income of $ 920,000 or $ 0.15 per diluted share. Net income in fiscal 2021 includes $ 1,389,000, including accrued interest of $ 8,000 for the forgiveness of the loan under the Paycheck Protection Program.

Fourth Quarter Fiscal 2022

Cyanotech reported net sales of $ 8,126,000 for the fourth quarter of fiscal year 2022 compared to $ 9,438,000 in the fourth quarter of fiscal 2021, a decrease of 13.9%. Gross profit was $ 2,894,000 with gross profit margin of 35.6%, compared to gross profit of $ 2,771,000 and gross profit margin of 29.4% in the fourth quarter of fiscal 2021. Operating income was $ 364,000 compared to operating loss of $ 24,000 in the fourth quarter of fiscal 2021 Net income was $ 277,000, or $ 0.04 per diluted share, compared to net loss of $ 200,000, or ($ 0.03) per diluted share in the fourth quarter of fiscal 2021.

Please review the Company’s Form 10-K for the period ended March 31, 2022 for more detailed information.

– Cyanotech will host a broadcast at 8:00 PM EDT on Thursday, June 23, 2022 to respond to questions about its operating results and other topics of interest. Interested parties are asked to submit questions to questions@cyanotech.com before 12 pm EDT on Thursday, June 23, 2022. The Company will respond only to relevant questions relating to the Company’s fourth quarter and 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 Pacific®. 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 supplements, 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 US 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-K for the fiscal year ended March 31, 2022, 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

CONSOLIDATED BALANCE SHEETS

March 31,

2022

2021

(in thousands, except
share data)

ASSETS

Current assets:

Cash

$

2,589 th most common

$

3,767 th most common

Accounts receivable, net of allowance for doubtful accounts of $ 67 in 2022 and $ 32 in 2021

3,664 th most common

2,436 th most common

Inventories

9,466 th most common

8,415 th most common

Prepaid expenses and other current assets

545

488

Total current assets

16,264 th most common

15,106 th most common

Equipment and leasehold improvements, net

11,885 th most common

12,136 th most common

Operating lease right-of-use assets, net

3,787 th most common

3,517 th most common

Other assets

109

120

Total assets

$

32,045 th most common

$

30,879 th most common

LIABILITIES AND STOCKHOLDERS ‘EQUITY

Current liabilities:

Payable accounts

$

2,362 th most common

$

2,287 th most common

Accrued expenses

1,412 th most common

844

Customer deposits

164

124

Operating lease obligations, current portion

393

343

Line of credit

1,000

Current maturities of long-term debt

490

1,210 th most common

Total current liabilities

4,821 th most common

5,808 th most common

Long-term debt, less current maturities

4,336 th most common

4,823 th most common

Long-term operating lease obligations

3,386 th most common

3,175 th most common

Other long-term liabilities

15

32

Total liabilities

12,558 th most common

13,838 th most common

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 6,202,223 shares at March 31, 2022 and 6,116,073 shares at March 31, 2021

124

122

Additional paid-in capital

33,557 th most common

33,267 th most common

Accumulated deficit

(14,194

)

(16,348

)

Total stockholders’ equity

19,487 th most common

17,041 th most common

Total liabilities and stockholders’ equity

$

32,045 th most common

$

30,879 th most common

CYANOTECH CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

Years ended March 31,

2022

2021

2020

(in thousands, except per share data)

Net sales

$

35,968 th most common

$

32,345 th most common

$

31,899 th most common

Cost of sales

22,402 th most common

21,228 th most common

19,199 th most common

Gross profit

13,566 th most common

11,117 th most common

12,700 th most common

Operating expenses:

General and administrative

5,367 th most common

4,876 th most common

5,281 th most common

Sales and marketing

4,913 th most common

5,518 th most common

5,758 th most common

Research and development

712

639

608

Total operating expense

10,992 th most common

11,033 th most common

11,647 th most common

Income from operations

2,574 th most common

84

1,053 th most common

Other income (expense):

Interest expense, no

(392

)

(550

)

(657

)

Gain on extinguishment of debt

1,389 th most common

Total other income (expense), no

(392

)

839

(657

)

Income before income taxes

2,182 th most common

923

396

Income tax expense

(28

)

(3

)

(9

)

Net income

$

2,154 th most common

$

920

$

387

Net income per share:

Basic

$

0.35

$

0.15

$

0.06

Diluted

$

0.35

$

0.15

$

0.06

Shares used in calculation of net income per share:

Basic

6,157 th most common

6,070 th most common

5,956 th most common

Diluted

6,168 th most common

6,079 th most common

5,959 th most common

View source version on businesswire.com: https://www.businesswire.com/news/home/20220622005334/en/

Contacts

Bruce Russell
(310) 346-6131
brussell@cyanotech.com

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