US kefir maker Lifeway Foods booked a drop in full-year profit as rising costs offset higher sales in the 12 months. 

The company said cost of goods sold as a percentage of sales rose to 74% from 71% in 2013. Total operating income fell by around 45% – or US$3.6m – to $4.4m in the period to end-December. Lifeway attributed the drop to “the cost of conventional and organic milk, our largest raw material”, which rose around 30% in the year. 

Net income fell to $2.8m from $5m last year. 

However, the company did see strong top line growth during the period. Revenue increased 22% to $119m thanks to increased awareness of the company's flagship Kefir line, as well as ProBugs, Organic Kefir and BioKefir. 

Julie Smolyansky, CEO, commented: "Fiscal 2014 was an exciting year for Lifeway, in which we achieved many important milestones including the launch of our first ever national television commercial. We are extremely pleased with the positive response we have seen thus far and believe our increased brand awareness will lead to continued success for Lifeway."