Cyanotech Corporation

Aloha from Kona, Hawaii. Thank you all for joining us today. I'm Matt Custer, President and Chief Executive Officer of Cyanotech. Joining me on the call today is Felicia Layden, our Chief Financial Officer. I'm pleased to report Cyanotech's fourth quarter and fiscal year 2023 earnings result. I will turn the call over to Felicia to provide her forward-looking statement.

Thanks, Matt. Our discussion today may include forward-looking statements. We do not undertake any obligation to update forward-looking statements either as a result of new information, future events, or otherwise. Our actual results may differ materially from what is described in these forward-looking statements. Some of the factors that may cause results to differ are listed in our publicly filed documents. For additional information, we encourage you to review our 10-K fiscal year 2023 report filed with the SEC I will turn it back to Matt. Matt?

Thank you, Felicia. Fiscal year 2023 was a challenging year as a result of the number of macroeconomic events and timing of sales. Consumers shifted their spend from goods to experience and services Lower sales in the bulk business due in part to inventory adjustments after the global supply chain issues eased and lower sales in the e-commerce business that were driven by a difference in strategy implemented by our third-party distributor. Our manufacturing operations produce consistent and high-quality algae. However, the cost per kilo for spirulina in particular was a drag on gross margin as we reduced production volume to align with demand, resulting in a higher cost per kilo. In the fourth quarter of fiscal year 2023, the company generated cash flow of $583,000 from operations as a result of the cash-saving initiatives we implemented in the second quarter, including slowing production and reducing headcount. Despite the disappointing sales figures I'm hopeful for the future, we are well-positioned to meet customer needs in a growing market for naturally derived, high-value nutritional products. Now I'd like to turn over the call to Felicia to discuss the financials. Felicia, please.

In the fourth quarter of this fiscal year, net sales were 5.4 million as compared to 8.1 million last year, a decrease of 2.7 million or 33.7%. Total sales for the fiscal year were 23.2 million as compared to 36 million last year, a decline of 12.8 million or 35.6%. The declines were most pronounced in the bulk sales with a decline of 57% based on the items Matt discussed. Gross profit for the fourth quarter of fiscal 2023 was $1.4 million, with a gross profit margin of 25.7% compared to a gross profit of $2.9 million and gross profit margin of 35.6% in the fourth quarter of fiscal 2022. Total gross profit for the fiscal year was $7.3 million with a gross profit margin of 31.3% as compared to $13.6 million with a gross profit margin of 37.7% last year. The 6.4 percentage point decline was previously discussed. Fourth quarter operating loss was $1.3 million compared to operating income of $364,000 in the fourth quarter of fiscal year 2022. For the full year, operating loss was two point nine million compared to operating income of two point six million in the prior fiscal year. Net loss for the fourth quarter was one point four million or twenty three cents per loss. Twenty three cents loss per share compared to a net income of two hundred and seventy seven thousand four cent earnings per share in the prior year. Net loss for the full year was $3.4 million or $0.55 loss per share compared to net income of $2.2 million or $0.35 per share in the prior year. The company ended the current fiscal year with cash of $974,000 and working capital of $5.3 million as compared to $2.6 million and $11.4 million respectively as of March 31, 2022. I will hand the call back to Matt for concluding comments. Matt?

We have not had any questions. Thank you for attending the call. Please stay safe and healthy. Aloha.