Second quarter revenue was 36% higher than last year’s Q2. Revenue for the first six months at $5.4 million was 28% higher than last year’s first half. Net income was $0.7 million in Q2, a boost of $0.6 million or 603% over prior year Q2 bringing first half net income to $0.9 million contrast to $0.3 million in fiscal 2016. Sales grew in all business sectors except non-aqua. The leading revenue increase was in Latin America but Asia had the leading percentage increase.
The shrimp industry began to recover in Q3 of fiscal 2016 as shrimp prices started to rise. Prices continue to slowly increase. Also, the industry has begun to adapt to disease presence by improving culturing practices such as the use of raceway systems. Disease prevalence in Asia and Mexico inhibits sales recovery to 2015 levels so shrimp production will be slow to recover. But, with higher shrimp prices farmers are more willing to try a crop, which is good for Epicore’s hatchery product sales.
Results as contrast to prior fiscal year quarter two are as follows:
- Q2 revenue of $3.0 million was 36% higher than Q2 last year
- Q2 gross profit of $1.8 million was 54% higher than Q2 last year
- Q2 operating expenses of $1.0 million were 1% higher than Q2 last year
- Q2 earnings before taxes of $0.8 million were 382% higher than Q2 last year
- Q2 net income of $0.7 million was 603% higher than Q2 last year
- Q2 EBITDA1 of $0.9 million was 280% higher than last year Q2
- Q2 basic earnings per share of $0.03 were 575% higher than Q2 last year
- Q2 shareholders’ equity of $10.4 million was 22% higher than Q2 last year
- Q2 cash balance of $3.5 million was 107% higher than Q2 last year
- YTD cash flow from operating activities was $0.3 million
Gross profit raised 54% in Q2 because of the increase in revenues and to a higher average selling price because of product sales mix. Operating expense was controlled to a small increase of 1% over prior year Q2 and only a 3% increase for the first six months. Efficiencies were created from recent capital expenditures.
Epicore continues to generate positive net income from operating activities. Cash at the end of the quarter was $3.5 million as contrast to $3.4 million, the same as the end of fiscal 2016. With these funds, expected sales revenue growth and continued relatively low operating costs, administration anticipates there will be sufficient cash to meet the fiscal year’s financial requirements, to fund expansion of aquaculture and environmental remediation marketing efforts and to pursue new strategies for enhancing shareholder value.
Over the last two years, Epicore has invested materially in a second building and automated packaging equipment. This added space has been critical to our ability to increase production levels. All automated packaging equipment is in place and operational. The board has approved an ongoing capital program to enhance efficiencies and ensure redundancies in critical applications of our operations.