Martek DHA Infiltrates Functional Market

Martek DHA Infiltrates Functional Market

COLUMBIA, Md.Martek Biosciences Corp. (NASDAQ:MATK) reporteddeclines in revenues and earnings for its first quarter, but noted it hasperformed to managements expectations and is positioned for growth in therest of 2006. Net revenues were down almost $4 million to $62.9 million, whilenet income fell $2.5 million to $5.6 million or $0.17 per share. The companypointed to numerous factors in the declines, but also highlighted numerousachievements during the quarter.

While a previously reported inventory build-up contributed to slow sales, thequarter results represent a sequential improvement from fourth quarter 2005, afeat Martek attributed to new core infant formula customers in new and existinginternational markets. Additionally, idle capacity costs and lower contract manufacturing margins narrowed gross margin, and thecompany continued its commitment to DHA research by spending an additional $700,000 on R&D in the quarter, primarily onclinical studies on cognitive benefits.

Among its highlights, Martek reported its DHA is featured in soymilk for thefirst time in the United States, via a partnership with Odwalla; is included in a new prescription prenatal vitamin from Mission Pharmacal; isslated for inclusion in an infant formula in Israel by Medici Medical Ltd; and will be an ingredient in a new PBM Products Inc. organic infantformula to be sold in Wal-Mart stores. Also, the Martek DHA logo is now included on numerous finished products, including certain Target Storesprivate label infant formulas.