NutraCea Announces Second Quarter and Six Months Financial Results

NutraCea (NTRZ) , a leader in stabilized rice bran ("SRB") nutrient research and technology, announced today its financial results for the second quarter and six months ended June 30, 2007.

Total revenues for the second quarter were approximately $13.0 million, an increase of $8.8 million, or 212% from the second quarter fiscal 2006. For the three months ended June 30, 2007, the Company's net profit was $2 million, or $0.01 per diluted share, compared to a net profit of $399,000, or $0.00 per diluted share, in the same period last year. For the six months ended June 30, 2007, the Company's net profit was $1.8 million, or $0.01 per diluted share compared to a net profit of $166,000, or $0.00 per diluted share for the six months ended June 30, 2006.

Gross margin from product sales in the second quarter was $4.1 million, or 52%, compared to $1.8 million, or 44%, during the second quarter of last year. Gross margin from product sales for the six months was $5.0 million, or 50%, compared to $3.5 million or 44% during the six months of the previous year.

For the six months ended June 30, 2007, consolidated revenues were approximately $15 million, an increase of approximately $7 million, or 89% compared to the comparable six months of the previous year.

Chief Executive Officer Mr. Bradley Edson stated, "NutraCea has delivered a solid quarter of sales growth and new initiatives. During the quarter several new products were launched with our stabilized rice bran as a primary ingredient and we expect more product launches from major food companies going forward and to experience progress in all channels of distribution. We have expanded our production capacity and we intend to continue to do so both domestically and internationally. In the past year we have increased our capacity from less that ten thousand tons annually to over 40,000 with expectations of reaching 80,000 tons during first quarter of 2008. The estimated global demand still far exceeds our current production capacity and we will endeavor to meet that demand as quickly as possible."
Mr. Leo Gingras, COO of NutraCea noted, "Our expansion in the U.S. continues at an aggressive pace with completion of our Mermentau, LA and Arbuckle, CA plants, completion of our expansion at Dillon, MT and the acquisition of assets in Freeport, TX. Construction of our Lake Charles, LA, facility, although delayed by weather, should be completed in the first quarter of 2008. We are particularly pleased that our international expansion plans have taken a large step forward with the formation of our joint venture in Southeast Asia, a region that produces more than ten times as much rice bran as the U.S. and E.U combined. We are also moving ahead on our first European facility and look forward to servicing our customers in the E.U. with local production in 2008.

Edson concluded, "We see diverse markets for stabilized rice bran and have taken appropriate steps to increase demand, develop marketing channels and increase production capacity. We have a proprietary product which has unique nutritional benefits, and, to date, we are the only company that can lay claim to the process that can stabilize rice bran with a shelf life of over one year without diminishing its superior nutrient profile. The balance sheet continues to remain strong with $51.5 million in cash and cash equivalents and no debt. We look forward to successfully capitalizing on the opportunities that lay ahead."

About NutraCea
NutraCea is a leader in stabilized rice bran nutrient research and dietary supplement development. Through its wholly owned subsidiary RiceX, the company manufacturers as well as distributes products and food ingredients made from Rice Bran through its proprietary technology and processes. The Company has developed intellectual properties to create a range of proprietary product formulations, delivery systems and whole food nutrition products. NutraCea's proprietary technology enables the creation of food and nutrition products from rice bran, normally a wasted by-product of standard rice processing. In addition to its whole foods products, NutraCea develops families of health- promoting "nutraceuticals," including natural arthritic relief and cholesterol-lowering products. More information can be found in the company's filings with the SEC and you can visit the NutraCea web site

Forward Looking Statements
This release contains forward-looking statements, including, but not limited to, statements regarding revenue recognition, the timing for completion of our facilities, our ability to advance international initiatives, and our anticipated sales and production capacity. Actual results may differ from those projected due to a number of risks and uncertainties, including, but not limited to the possibility that any increased production capacity will be delayed or reduced in whole or in part, market demand for our products does not remain strong, future customers are unable to timely pay for our products, and by all other matters specified in the Company's filings with the Securities and Exchange Commission. These statements are made based upon current expectations that are subject to risk and uncertainty. The Company does not undertake to update forward-looking statements in this news release to reflect actual results, changes in assumptions or changes in other factors affecting such forward-looking information. Assumptions and other information that could cause results to differ from those set forth in the forward-looking information can be found in the Company's filings with the Securities and Exchange Commission, including the company's most recent periodic report.

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