Opta Food reports 4Q results

Opta Food Ingredients has reported a loss in the fourth quarter ended 31 December 2001 of €360,748. Revenue for the quarter was $5.9 million (€6.73m) compared with $6.0 million for the comparable 2000 quarter.

Results for the latest quarter included a previously announced charge of $389,000, or $.04 per share, for non-recurring costs. The company claims this is related to a corporate restructuring that is designed to reduce its cost structure by around $1 million annually.

For the year ended 31 December, 2001, revenue was $25.0 million compared with $25.8 million in the prior year. The net loss for 2001 was $3.0 million, or $.28 per share, compared with a net loss of $423,000, or $.04 per share, for 2000.

In addition to the fourth quarter restructuring charge, 2001 results included a one-time charge of $713,000, or $.07 per share, recorded in the third quarter for the write-off of inventory that no longer met Opta's quality specifications.

Arthur J. McEvily, president and chief executive officer, said the company's fourth quarter revenue remained flat due to continued softness in sales to a major quick-service restaurant as well as a reduction in shipments to a few other major customers.

The lower sales levels and higher than anticipated inventory levels continue to have a negative impact on the company's gross margins due to inefficient utilization of plant manufacturing capacity. Gross margins were 19 and 21 percent of revenue for the fourth quarter and 2001, respectively, compared with 23 and 29 percent of revenue for the respective prior-year periods. McEvily said the company is focused on reducing inventory levels by managing plant production rates during 2002. He also noted that from 1 January 2002, Opta implemented a five per cent price increase on all fibre products.

McEvily said: ``Increasing sales and diversifying Opta's customer base are key priorities for 2002. We are focusing our sales resources on opportunities that leverage commercially proven applications of our products and provide improvements in product quality as well as potential cost savings to our customers.''​

McEvily said Opta is focusing on seven key application areas encompassing both its fibre and ingredient system product lines. These include breakage reduction for baked goods and snack foods; meat extension; total dietary fibre enhancement for cereals, breakfast bars and nutritional drinks; cheese extension; salad dressings; cultured dairy and dairy alternative products; and vegetarian burgers.