Kona-based microalgae products producer Cyanotech Corp. reported Wednesday that its sales plunged 45% in its fiscal second quarter due to a confluence of events that is prompting the company to tighten its cost structure.

CEO Matthew Custer attributed the decline to “the increased U.S. dollar exchange rate affecting international sales, lower sales in the bulk business, primarily in Asia, due in part to inventory adjustments after the global supply chain issues eased, and weaker sales in the e-commerce business.”

Cyanotech posted sales last quarter of $5.2 million compared with $9.4 million in the year-earlier period. The health dietary supplement product maker swung to a loss of $940,000, or a loss of 15 cents a share, from a gain of $970,000, or 16 cents a share, in the fiscal second quarter of 2021.

Custer said the reduction in sales reduced the company’s working capital by $354,000, with its debt increasing $239,000 from the year-earlier quarter.

“The company has been through challenging times before that have provided a road map to reducing our spending, controlling our inventory, and protecting our working capital,” Custer said in a statement. “As sales slowed, we took steps to address our cost structure and we are also initiating renewed focus on our sales and marketing functions. These steps, I believe, will position us for success when our sales normalize.”

Cyanotech produces BioAstin, Hawaiian Astaxanthin and Hawaiian Spirulina Pacifica.

Shares fell 38 cents to $1.53 after the earnings were announced.

SECOND-QUARTER LOSS

$940,000

YEAR-EARLIER NET

$970,000