Galaxy Nutritional Foods, Inc., the Florida-based producer of cheese products and plant-based cheese alternatives, has posted improved earnings for both the third quarter and the first nine months of the current year.
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Net income for the three months to the end of December reached $0.73m, or $0.03 per diluted share, against a net loss of $11.75m in the corresponding period last year. Net sales were 33% lower at $6.1m.
For the nine-month period, the company trimmed its net loss to $54,681, from $22.32m in the corresponding period last year. Sales for the nine months fell from $29.4m to $20.7m.
CEO Michael E. Broll said the improved profit performance in the third quarter was primarily driven by an improvement in gross margin to 44.0% of net sales, versus a gross margin of 20.8% in the same quarter the previous year.
Lower sales during the first three quarters of the 2007 fiscal year reflected the elimination of unprofitable and marginally profitable private label and Galaxy imitation sales, Broll added.
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By GlobalData“Our focus on a brand-oriented sales and marketing strategy has allowed gross margins to improve significantly from prior-year levels,” Broll said. “With profitability and positive operating cash flows having been restored, our strategic initiatives going forward will include a greater emphasis on sales and marketing activities and new product introductions that are designed to increase sales to existing customers and expand overall consumer awareness of Galaxy’s ‘healthy alternative’ food product lines.”
Broll said that fourth-quarter sales would continue to lag behind the corresponding period in the previous year, but the company expected a further improvement in profitability in the fourth quarter, against the fourth quarter of the previous fiscal year.
