From Gerry
Our fourth quarter revenue increased to $2.1 million. That's up $782 thousand, or 59%, over the fourth quarter of 2010. Revenue grew as a result of our increases in new customers, introduction of new products and rising consumer demand for our unique products, in particular, our Eco-i-lite Power Failure Program.
Higher sales resulted in gross profit of $525 thousand, up 24.7% over the prior year period. As a percentage of sales, gross profit declined somewhat due to changes in product and customer mix. As sales continue to expand, and we implement our domestic distribution strategy, we expect to see margins strengthen. Sales through our domestic distribution system should provide stronger margins for us than the direct import sales program.
Net operating income increased sharply to $81 thousand, from $33 thousand in the prior year period, reflecting our continued focus on controlling our limited resources and cutting costs in all categories, except for product development, which we see as critical to our continued growth.
During the quarter, our product development expenses were $57 thousand, which is consistent with where we have been all year. We expect to make more investments in product development in 2012, as we continue to drive our constant innovation and our commitment to introduce new products to the market.
Net income for the fourth quarter of 2011 was $27 thousand, resulting in three positive quarters for the year, which is a major advancement for us.
Now, let me turn my attention to a summary of our record year. Product development and channel expansion drove our significant growth in 2011. Revenue grew 93.8% to $10.2 million from $5.3 million in 2010. Gross profit also increased for the year by 53.7% to $2.5 million from $1.6 million in 2010. Net operating income increased $1.3 million to $871 thousand, and operation margins expanded significantly to 8.5%. Net income for the year was a record
$576 thousand, up $1.3 million compared with a net loss of $738 thousand in 2010.
Again, these results highlight our commitment to control spending and to focus the use of our limited resources into product development and revenue growth.
Our business model is focused on cash generation through careful working capital management. Cash provided by operating activities increased to $1.3 million for the year.
This concludes my summary of 2011 and now I will turn the call back to Stewart, so he can touch on our outlook and strategy for 2012 and beyond.
