Seafood and specialty foods group Vita Food Products has reported a consolidated net loss of US$725,000, or $0.15 per share, for the third quarter, against a net loss of $257,000, or $0.07 per share, in the third quarter of 2005, and has warned that it will not make a profit for the full 2006 fiscal year.
Go deeper with GlobalData
Total net sales for the quarter rose to $12.5m, from $11.4m in the third quarter of 2005.
Losses at the company’s seafood division declined for the quarter from $320,000 to $291,000, which the company attributed to reduced employment-related selling and administrative expenses, partially offset by a decline in gross profit. Vita Seafood’s net sales for the quarter rose by 12.4% to $6.5m, driven by higher salmon sales to major grocery and mass merchandise customers.
Vita’s other division Vita Specialty Foods (VSF), which produces salad dressings, marinara sauces, cooking sauces, honey and other specialty food products, posted a net loss of $434,000, against net income in the corresponding quarter last year of $63,000.
Vita attributed the loss to start-up costs associated with items produced under a new licensing agreement, and by an increase in reserves for potential returns of unsaleable product, as well as increased selling and distribution expenses. VSF’s net sales rose by 6.4% to $5.9m, on the back of growth in sales of brand name licensed products.
US Tariffs are shifting - will you react or anticipate?
Don’t let policy changes catch you off guard. Stay proactive with real-time data and expert analysis.
By GlobalData“We are pleased with the continued growth in sales this year for both segments and the improved results from the seafood segment,” said president and CEO Cliff Bolen, “but the significant start-up costs associated with items produced under a new licensing agreement, together with a material increase in reserves for potential product returns incurred by the VSF segment have removed any profit expectations for 2006. However, the company believes these costs were largely of a one-time nature and therefore are not expected to impact future results.”
