Martek Increases Sales, Manufacturing Capabilities

January 14, 2002

2 Min Read
Martek Increases Sales, Manufacturing Capabilities

Martek Increases Sales, Manufacturing Capabilities

COLUMBIA, Md.--Martek Biosciences Corp.(NASDAQ:MATK) reportedthat for its fourth quarter (4Q01) and fiscal year (FY01), ended Oct. 31, thecompany experienced huge sales increases but will need to increase production tomeet product demands. Net sales for the company's 4Q01 came in at $5.8 million,an 87.3-percent increase over 4Q00's $3.1 million. Gross margin came in at 31.5percent of sales compared to 15.8 percent in the same quarter last year, withgross profit being affected by the cost of arachidonic acid (ARA) oil, which iscurrently bought from a third party, DSM Gist B.V. Operating expenses increasedto $5.7 million from $4.9 million due to an increase in research and developmentcosts, as well as general corporate insurance and legal expenses. Net lossimproved to $3.6 million (or $.18 per share lost) from $4.1 million (or $.23 pershare lost) posted in the same quarter last year.

For the year, sales almost doubled to $18.8 million from $9.7 million postedin FY00. Gross margin was 33.3 percent of sales in FY01, compared to 26.7percent for the year prior. Operating expenses increased slightly to $21.2million from $19.5 million logged in FY00. The bottom line improved, coming inat a net loss of $13.7 million (or $.73 per share lost) rather than FY00's $15.7million (or $.91 per share lost).

"Sales took off throughout FY01," stated Henry Linsert Jr., chiefexecutive officer. "Next year, sales should continue to grow." Headded that this was due to the company doubling its production capacity inWinchester, Ky., as well as having just signed a non-binding letter of intent toacquire certain assets of FermPro Manufacturing LP. This acquisition would bringwith it a 150-acre site in Kingstree, S.C., where FermPro provides tollfermentation and recovery technologies for organisms such as algae and fungi.Not only will this provide expanded capabilities for Martek's manufacture ofnutritional oils, but the company plans to continue operating FermPro's tollmanufacturing business, which has yearly revenues of approximately $20 million.

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