CYAN anyone? Couple of nice turnaround quarters with fiscal Q1 earnings of .09/share and Q2 earnings of .08/share. That's despite Q2 being hurt by these water restrictions, which were lifted at the end of the quarter. From the last earnings PR:
“On a year to date basis, sales of our packaged products remain stable, showing a 7% increase over last year. The company’s second quarter net sales decrease of 18% was driven by a 16% decrease in sales of our packaged products and a 28% decrease in sales of our bulk products. The packaged sales decrease is related to the quarterly variance year to year in the timing of orders, as well as the shift away from lower margin channels into higher margin ones. The 28% decrease in bulk sales was primarily the result of a lack of sufficient Spirulina supply. The company engaged in various alternative cultivation methods for Spirulina during the quarter prompted by self-imposed water conservation efforts related to county wide water restrictions. These alternative methods had a net negative impact on Spirulina production for the quarter. The county wide water restrictions were lifted at the end of the quarter."
Think production will be back up in fiscal Q3. Although there is some seasonality with less production during the winter. I like the focus on higher margins (gross margins were impressive in Q2). Bottom line benefiting from lower legal expenses. Tough revenue comp in Q2. Couple of much easier comps coming up. Top & bottom lines should look good.
CYAN not super cheap at $4. But I feel like if Q3 comes in with a decent profit vs. a loss last year, this low floater will get a pop. If they manage another .08+ quarter, could zoom back to the $5's. I'll be accumulating ahead of that Q3 report in early February.
