Cheese, lassi and yoghurt producer Lifeway Foods has posted a fall in third-quarter profits in the face of “record” input costs.
For the three months ending 30 September, the US company reported operating income decreased to US$1.6m, compared to US$1.9m in the same period last year. Net income was US$1m compared to US$0.9m in the same-year period.
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The company said profit was hit by increased transportation and other production supply costs, as well as the increased price of conventional milk, which was approximately 35% to 45% higher in the third quarter of 2011 than the same period in 2010.
Lifeway had better news on revenues, with consolidated net sales increasing 21% to US$17.7m.
Julie Smolyansky, CEO of Lifeway Foods, was upbeat despite the profit drop. “We are very pleased with our ability to continue to grow our sales and profits despite facing record high input costs”, she said.
“We will continue to intently manage the controllable aspects of our business as we realise increased production efficiencies and economies of scales to achieve record annual sales and profits in 2011.
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By GlobalData“Going forward, we intend to take advantage of the opportunity to expand distribution in the US and internationally with Lifeway’s market-leading position.”
The nine-month results showed net income fell to US$3.2m from US$3.9m in 2010. Operating income decreased 19% to US$5.5m. Net sales, meanwhile, increased 22% to US$53.2m.
