Omega Protein Corp. (NYSE:OME), a nutritional product company and a leading integrated provider of specialty oils, essential fatty acids and specialty protein products, reported financial results for the first quarter ended March 31, 2015.

First quarter highlights:

"We continued our movement towards becoming a more balanced nutrition company in the first quarter with our human nutrition segment generating a record $35 million of revenues," commented Bret Scholtes, Omega Protein's president and chief executive officer. "As we expected, our animal nutrition segment experienced lower sales volumes primarily due to lower beginning inventory levels. Looking ahead, our team remains focused on further integrating our recent acquisitions to drive growth and diversification in our nutrition businesses." 

First quarter 2015 results
The Company's revenues increased 13 percent from $63.5 million in the same period last year to $71.6 million. This increase was due to growth in human nutrition revenues of$26.6 million, partially offset by a decline in animal nutrition revenues of $18.4 million. The increase in human nutrition revenues was largely due to the addition of Bioriginal Food & Science Corp. ("Bioriginal"), which was acquired in September 2014. The decrease in animal nutrition revenues was due to lower sales volumes of 76 percent and 12 percent for the Company's fish oil and fish meal, respectively, partially offset by increased sales prices of 56 percent and 6 percent for the Company's fish oil and fish meal, respectively. The composition of revenues by nutritional product line for the first quarter of 2015 was 49 percent dietary supplements and food, 37 percent fish meal, 13 percent fish oil and 1 percent fish solubles and other. 

First quarter of 2015 revenues decreased 30 percent from $102.5 million in the fourth quarter of 2014 to $71.6 million. This decrease was due to a $31.3 million decline in animal nutrition revenues, partially offset by a $0.5 million increase in human nutrition revenues. The decrease in animal nutrition revenues was primarily due to lower fish meal and fish oil volumes of 46 percent and 66 percent, respectively, partially offset by higher fish meal and fish oil sales prices of 7 percent and 30 percent, respectively.

The Company reported gross profit of $14.8 million, or 20.7 percent as a percentage of revenues, for the first quarter of 2015, versus $20.5 million, or 32.3 percent as a percentage of revenues, in the first quarter of 2014. The decrease in gross profit as a percentage of revenues was due to corresponding reductions in both the animal and human nutrition segments. Animal segment gross profit as a percentage of revenues declined from 34.6 percent to 28.6 percent, due primarily to a higher cost per unit for the most recent season's production, as well as a $0.4 million expense for fuel hedge ineffectiveness in the first quarter of 2015. Human nutrition gross profit as a percentage of revenues decreased from 16.9 percent to 12.2 percent due primarily to changes in product mix and a lower gross profit as a percentage of revenues for protein products.

Compared to the fourth quarter of 2014, first quarter gross profit decreased from $22.5 million, or 22.0 percent as a percentage of revenues, to $14.8 million, or 20.7 percent as a percentage of revenues, due primarily to lower animal nutrition revenues. Animal nutrition gross profit as a percentage of revenues was nearly unchanged, decreasing from 28.7 percent to 28.6 percent. Human nutrition segment gross profit as a percentage of revenues increased from 8.6 percent to 12.2 percent due primarily to improved results from protein products.

Selling, general and administrative expense ("SG&A") for the first quarter increased by $3.3 million to $9.4 million compared the first quarter of 2014, primarily as a result of the Bioriginal acquisition. SG&A expense increased $0.7 million from $8.7 million in the fourth quarter of 2014.

In the fourth quarter of 2013, the Company closed its menhaden fish processing plant located in Cameron, Louisiana and re-deployed certain vessels from that facility to the Company's other Gulf Coast facilities. In conjunction with the closure, the Company incurred charges of $0.6 million and $1.3 million in the first quarters of 2015 and 2014, respectively. 

Loss on foreign currency related to Bioriginal was $0.5 million for the first quarter of 2015; there was no gain or loss on foreign currency in the first quarter of 2014.

The first quarter of 2015 effective tax rate was 36.9 percent compared to 33.9 percent in the first quarter of 2014 and 46.5 percent in the fourth quarter of 2014. The first quarter of 2015 effective tax rate reflected the impact of non-deductible expenses and the fourth quarter of 2014 effective tax rate reflected lower deductions resulting from tax rules enacted during the quarter. 

Net income for the first quarter of 2015 was $1.7 million ($0.08 per diluted share) compared to $8.0 million ($0.37 per diluted share) in the same period last year and $3.2 million ($0.14 per diluted share) in the fourth quarter of 2014. Excluding adjustments for certain items, net income for the first quarter of 2015 would have been $2.6 million($0.12 per diluted share), compared to $9.0 million ($0.42 per diluted share) in the same period last year and $7.8 million ($0.35 per diluted share) for the fourth quarter of 2014.

Adjusted EBITDA totaled $10.4 million for the first quarter of 2015, compared to $19.1 million for the same period last year and $19.7 million for the fourth quarter of 2014.

Balance sheet
The Company's March 31, 2015 cash balance decreased $1.2 million from Dec. 31, 2014 to $0.2 million, and total debt increased $4.4 million from Dec. 31, 2014 to $39.7 million on March 31, 2015, due primarily to business seasonality and capital expenditures. Stockholders' equity increased $1.5 million to $267.4 million as of March 31, 2015 compared to $265.9 million as of Dec. 31, 2014.