Kefir demand lifts Lifeway Foods' 3Q sales

MORTON GROVE - Kefir products maker Lifeway Foods said net sales for the third quarter of 2014 increased 27 percent as demand for its products grow.

Consolidated net sales for the quarter increased $6.3 million to $30.1 million, compared to $24 million during the same three-month period in 2013.

"Our strong double digit net sales growth in the third quarter demonstrates the continued demand for our nutritious probiotic kefir products," said Julie Smolyansky, CEO of Lifeway Foods. "Greater brand awareness, increased distribution, and successful new product innovation helped us deliver another quarter of profitability despite continued pressure from increased milk prices.

"We are committed to executing on our long-term growth strategy and believe there are compelling opportunities ahead as we expand with new and existing customers," she added.

Gross profit for the third quarter of 2014 was $7.4 million, compared to $6.9 million in the third quarter of the prior year. The company's gross profit margin decreased to 25 percent in the third quarter of 2014 versus 29% in the third quarter of 2013. The decrease was primarily attributable to an approximate 20 percent increase in the cost of milk, the company's largest raw material, compared to the same period last year. In addition, gross profit for the quarter was impacted by an increase in depreciation expense of $0.6 million related to a true-up on Starfruit leasehold improvements and expense associated with assets placed in service at the Lifeway Wisconsin location.