Martek Announces Fourth Quarter and FY 2007 Financi...(supplements and animal feeds ...)

and animal feeds 4,444 2,935 17,439 10,121

Non-nutritional products 629 970 4,064 3,816

Total product sales $79,025 $63,809 $292,549 $255,838

The overall increase in product sales reflects continued strong demand from Martek's U.S. and international infant formula customers, the launch of new and growth of existing food and beverage products containing life'sDHA(TM) and the Company's increased penetration into the pregnancy and nursing and nutritional supplements markets. Compared to the third quarter of fiscal 2007, there was a decline of $600,000 in non-infant formula nutritional revenues as a result of customer ordering patterns associated with new product launches. Martek expects non-infant formula nutritional revenues to be between $6.2 million and $7.6 million in the first quarter of fiscal 2008.

New products launched during the fourth quarter co-branded with the Martek life'sDHA(TM) logo include:

Food and Beverage Products

-- Minute Maid(R) Pomegranate Blueberry Flavored 100% fruit juice blend

with life'sDHA(TM)

-- Beech-Nut(R) DHA Plus with life'sDHA(TM) baby food and cereals

-- British Biologicals' Kids-Pro Nutrition Drink with life'sDHA(TM)

(India)

-- Ricos(R) Cheese Sauce with life'sDHA(TM)

Pregnancy and Nursing Products

-- NutraBella's Bellybar(TM) with life'sDHA(TM) (expanded to entire

product line)

Gross Margin and Operating Expenses

The Company's gross margin has improved each quarter of fiscal 2007. Gross margin for the fourth quarter of fiscal 2007 was 40.2%, a sequential improvement over the third quarter gross margin of 38.5%. Gross profit margin continues to improve as a result of DHA productivity gains at Martek's plants and reductions in ARA costs. Gross profit margin in the fourth quarter also included a non-recurring property tax reco
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