Financial Review
Peter Jerome, Chief Financial Officer and Group Secretary
TYRATECH, INC. • ANNUAL REPORT 2011 • PAGE 11
Revenues
TyraTech continues to develop its product revenues and works to diversify our revenue sources as it matures as a
business. Overall revenues increased for the year to US$7.2 million (2010: US$4.6 million). Product revenues increased
to US$4.4 million (2010: US$2.1 million). Increased product sales related to the Terminix SafeShield™ product and a
new line of aerosol products, which are sold in the US institutional and commercial markets. Collaborative revenue
increased to US$2.7 million (2010: US$2.5 million) primarily from the impact of the new product payments under the
Terminix Product Supply Agreement.
Cost of Sales and Gross Margin
Cost of sales for the year was US$2.5 million (2010: US$3.3 million). This included cost of product sold of US$1.8 million
(2010: US$1.1 million) reflecting the leverage of our partnered sales programmes, and project costs for collaborative
revenue projects of US$0.7 million (2010: US$2.2 million). Gross margin from product sales was 59% in 2011 (2010:
46%). The increase in gross margin was primarily driven by higher margins on our household insecticide product.
Operating Expenses
Overall, operating expenses for the year were reduced by 2.4% to US$7.2 million (2010: US$7.4 million). The expenses
for the year include non-cash stock compensation to employees and non-employees of US$0.7 million (2010: US$0.9
million), and depreciation and amortization of US$0.2 million (2010: US$0.2million). The decrease in overall operating
expenses was driven primarily by the decrease in non-cash stock compensation expense. Since 2009, the company
has reduced its cash operating expenses by 39%.
