Dairy alternatives producer Galaxy Nutritional Foods is still making losses, reporting a loss of $744,437 for the third quarter of 2003, compared to $181,653 in the same period last year.
But the company reported an operating income of $115,198 for the quarter. Excluding a $190,720 compensation expense relating to accounting procedures, this would have been $305,918 compared to an operating loss of ($437,987) for the 2002 quarter.
EBITDA for the quarter was $819,559, or 8.3 per cent, fitting the growth over the last three quarters which have been higher than prior years. The company expects this trend to continue through fiscal 2004.
Gross margin continued to be strong, with the company posting a solid 30.8 per cent gross profit on sales for the third quarter of fiscal 2003. The annual gross margin for fiscal 2002 was 19 per cent.
Net sales for the third quarter were $9.8 million compared to net sales of $10.3 million for the comparable quarter one year ago, a decrease of 5 per cent. The company claims that it has kept sales at this level to allow it to improve operations, realign the product sales mix, restructure management, and conclude its financial restructuring.
For the nine months ended December 31, 2002, the company reported a net income available to common shareholders of $792,621, compared to a net loss of $8.6 million in the 2001 period. Average EBITDA for the nine months is 8.6 per cent versus a negative average EBITDA of (3.5%) for the comparable period one year ago. Net sales for the nine months ended December 31, 2002 were $29,993,813 compared with net sales of $33,500,132 for previous year's period.
CEO Christopher J. New said the current strategy would position Galaxy to meet the rapidly growing demand for its products, especially in the mass retail market. "Once our financial restructuring is completed, we should begin to better realize the vast opportunities that lie ahead of us."
New board members and managerial changes are expected to further strengthen operations, sales and marketing, to begin profitable sales growth. Galaxy has taken on Charles L. Jarvie, past president of Dr. Pepper and former CEO of Schenley Industries, as chairman of the board. Christopher J. New, formerly the company's COO, is now CEO and a director of the company.
Galaxy is to use micro-marketing methods and promotional partnerships to raise brand awareness. The company added that it expects fourth quarter sales, operating profit and margins to exceed those achieved in the third quarter of 2003.
Galaxy products are made from soy, rice and oats and are low in cholesterol and lactose free. Brand names include Veggie, Nature's Alternative, Soyco, Wholesome Valley and Lite Bakery.