Financial Review
Peter Jerome, Chief Financial Officer and Group Secretary
Revenues : TyraTech continues to develop its product revenues as we mature as a business.
Overall revenues from continuing operations decreased for the year to US$4.6 million (2009:
US$6.3 million). Not included in Revenue is an increase in Deferred Revenue of approximately
US$3.5 million. This increase in Deferred Revenue will be recognized in future periods. Product
revenues from continuing operations decreased to US$2.1 million (2009: US$2.6 million).
Increased product sales related to the Terminix SafeShield™ product, which is sold to the household
market, were offset by a decrease in sales of commercial and institutional products.
Collaborative revenue reduced to US$2.5 million (2009: US$3.7 million) with the impact of the
revised Kraft contract. These changes resulted in expenses incurred from September 2009
forward being reflected as revenue and equally offset as cost of goods sold.
Cost of Sales and Gross Margin : Cost of sales for the year from continuing operations
was US$3.3 million (2009: US$4.5 million). This included project costs for collaborative revenue
projects of US$2.2 million (2009: US$2.6 million), cost of product sold of US$1.1 million, (2009:
US$1.9 million). Gross margin from product sales was 46% in 2010 (2009: 27%). The increase in
gross margin was driven by product mix, with higher margins on our household product driving
the overall increase in product margin.
Operating Expenses : Overall, operating expenses from continuing operations for the year
were reduced by 43% to US$7.4 million (2009: US$13.0 million). The expenses for the year include
non-cash stock compensation to employees and non-employees of US$0.9 million (2009: US$3.3
million), depreciation and amortization of US$0.2 million (2009: US$0.5 million) and provision for
doubtful debts of US$0.0 million (2009: US$0.1 million). The decrease in overall operating
expenses was driven by a decrease in stock compensation expense of US$2.4 million, a decrease
in employee compensation costs of US$2.0 million (due to headcount reductions conducted
during 2010), and a decrease in discretionary spending (Legal, Travel, Facilities and Materials
and Supplies) of US$1.2 million.
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T y r a T e c h , I n c . : A n n u a l R e p o r t 2 0 1 0
