Martek sales stable, inventory destocking looms
This article was originally published in The Tan Sheet
The maker of life'sDHA reports second quarter revenues inched up 1.9 percent to $92.4 million, despite a 1.3 percent dip in infant formula sales to $77.4 million. Martek Biosciences set records for revenues and pretax profits during the quarter ended April 30, reporting 19.7 percent growth in net income to $11 million over the year-ago period. The Columbia, Md.-based nutritional oils firm said during a June 3 earnings call it expects a $10 million to $15 million revenue hit due to destocking of infant formula during its fiscal 2009 third and fourth quarters. CEO Steve Dubin expects the destocking to be temporary and infant formula sales growth should resume in 2010
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The maker of life'sDHA nutritional additive plans to overcome a drop in the U.S. birthrate by growing in global markets and conventional food applications. Martek Biosciences reported third-quarter revenues fell 12 percent to $77.8 million mainly due to inventory destocking, which the Columbia, Md., firm predicted (1"The Tan Sheet" June 8, 2009, In Brief). Martek's infant formula sales fell 15.4 percent, to $63.3 million, in the May-July period, although its pregnancy and nursing, nutritional supplements and animal feeds businesses shot up 58 percent to $7.9 million. Third-quarter net income dipped 4.3 percent to $8.9 million, Martek reported Sept. 2. ... DHA patents prevail: A ruling by the U.S. Court of Appeals for the Federal Circuit supports certain Martek patents on the process of extracting lipids from fermented microorganisms to produce DHA. Martek previously asserted that Swiss ingredients manufacturer Lonza infringed its patents, which Lonza said were invalid. In a Sept. 3 2decision, the court remands the case
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