October 14, 1997
Orlando, FL
Contact: Rebecca Barksdale
(407) 855-5500, extension 105
GALAXY FOODS ANNOUNCES SECOND QUARTER RECORD PROFITS
Galaxy Foods Company (NASDAQ: GALX), makers of healthy cheese and dairy-related products, today announced record net profit of $125,392 for the quarter ended September 30, 1997, compared to a net loss of $89,942 for the same quarter in the previous year. The Company also announced an enhanced gross margin of 24.9% for the quarter, an improvement of 50% over the same quarter in the previous year. Sales for the six months ended September 30, 1997 increased 28.6% to $10,915,451 as compared to $8,488,436 for the corresponding period in the prior year.
Angelo S. Morini, Galaxy’s president stated, "The return to profitability during this current fiscal year is the result of a long rebuilding process. We attribute the increase in gross margin to a strategic re-balancing of product mix, eliminating lower margin foodservice products and substituting higher profit margin retail products, including introduction of new and improved items. Retail sales for the six months ended September 30, 1997, represented 72% of the Company’s business, as opposed to 52% of sales for the year ended March 31, 1997. We intend to continue to increase retail supermarket sales of the Company's higher margin products and to expand distribution of our health food products into mainstream supermarkets."
Morini further stated, "We anticipate a significant increase in sales when our new Pullman loaf machine becomes operational, which is expected to be later this month. This new machine can produce up to $100 million annually and will establish the Company as a one stop shop, rounding out the foodservice product line which currently includes shreds, soft cheeses, cheese sauces, as well as grated and block cheeses. This increase in sales, combined with steadily improving gross margins and an effort to maintain administrative expenses will favorably impact net earnings as we continue to grow."
Galaxy Foods Company produces a complete line of healthy cheese and dairy-related products for the retail, food service and industrial markets. Galaxy Foods is the inventor and originator of form�gg�, a new, healthier and better way to make cheese and dairy-related products. Form�gg products are low or no fat, no saturated fat, have low or no cholesterol and no lactose and contain more vitamins and minerals than conventional cheese. Other brands' names include Soyco�, Soymage�, Veggie Slices�, Lite Bakery�, and Wholesome Valley�. For more information, contact Rebecca Barksdale at 407-855-5500, extension 105. You may also obtain more information, including the Monthly Insight newsletter, through Galaxy's web site at http://www.galaxyfoods.com (best viewed through Netscape Navigator). To be added to the mailing list for the Monthly Insight newsletter, call 407-855-5500, extension 307.
