Fourth quarter 2009 sales of $58.7 million were 9.9% lower than the fourth quarter 2008. Excluding a 5.9% favorable impact of foreign exchange, reflecting a weaker U.S. dollar, sales decreased 15.8%. The decrease is primarily due to lower volumes of an active pharmaceutical ingredient ("API") that utilizes the Company's polymeric drug delivery technology, lower sales of two APIs manufactured under long-term supply agreements and lower custom development revenues, all due to the timing of orders throughout 2009. Volumes of a feed additive for which a contract expired earlier in 2009 were also lower. Partially offsetting these decreases were increased generic revenues resulting from improved order patterns.
Fourth quarter 2009 Gross Margin increased to 24.7% of sales from 24.2% during the fourth quarter 2008, with foreign currency unfavorably impacting gross margin by 0.6% in the fourth quarter 2009. Cost reductions, and to a lesser extent, positive product mix, were the main drivers of the higher margins. This was partially offset by lower pricing of generic APIs and lower volumes of an API manufactured under a long-term supply agreement.
Selling, General and Administrative Expenses in the fourth quarter 2009 were $8.8 million compared to $9.0 million in the same period last year. The decrease is a result of lower personnel costs and professional fees at the corporate headquarters and the benefit of the termination of certain postretirement benefits partially offset by higher legal fees, higher expenses at the Company's manufacturing sites and an unfavorable impact of foreign currency.
Research and Development Expenses increased to $2.0 million in the fourth quarter 2009 from $1.6 million in the fourth quarter 2008 due to high
|SOURCE Cambrex Corporation|
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