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Hawaii’s largest grower of macadamia nuts is cutting back a 5-year-old strategy to sell packaged food.

Royal Hawaiian Orchards LP disclosed the downshift Monday in a financial report that also said its second-­quarter loss grew to $585,000 from a $497,000 loss in the same quarter last year.

Hilo-based Royal Hawaiian said in the report that it has reduced the variety of its branded products available in stores. The company also said it’s looking at reducing the number and types of retail channels for those products.

SECOND-QUARTER LOSS $585,000 YEAR-EARLIER LOSS $497,000

Royal Hawaiian began making packaged snacks in 2012 with a goal of earning a bigger return on its crop that it historically sold only raw in bulk, primarily to snack maker Mauna Loa Macadamia Nut Corp.

The line of snacks started with a dozen varieties of flavored nuts and fruit-and-nut clusters. In 2015 the company produced its first dark chocolate-covered macadamias, then followed up last year with macadamia butter and milk.

Using the phrase “Better for you,” Royal Hawaiian delivered its products nationally to about 20,000 grocery, natural food and other stores aimed at customers with healthy eating habits and enough disposable income to afford premium products.

“Our strategy is to capitalize on consumers’ views of nuts as a healthy snack that can command prices above traditional mass-marketed products,” the company said in its last annual report.

Breaking into the retail business had its challenges, including offering discounts to stores and customers that added to costs and left Royal Hawaiian with not enough capital to continue the strategy as planned. Earlier this year the company cut back on marketing and sold some processed nuts in bulk instead of holding them as inventory for packaged food production.

In its latest financial report, Royal Hawaiian said it had run into a shortage of working capital until May when it raised about $20 million by selling shares in the company. At the end of June, the company had $19.4 million in working capital.

For the April-June period, Royal Hawaiian said it increased its cash flow by selling nuts in bulk as soon as possible. The cutback in branded product variety helped reduce shipping and storage expenses and allowed the company to reduce selling and marketing activities.

Revenue in the second quarter totaled $7.8 million, up from $6.1 million in the same period last year. Revenue from branded product sales was $1.7 million in the recent quarter, up from $1.5 million a year earlier. Sales of bulk processed nuts jumped to $5.1 million from $3.8 million in the same comparable period. Royal Hawaiian also sold $1 million in raw nuts in the second quarter, up from $789,000 a year earlier.

“We have been increasing sales of bulk kernel due to the strong market for bulk at this time, and we expect to increase our focus on sales to larger retail customers such as club stores,” the company said, also adding that its inventory of processed nuts available to sell in subsequent quarters has been reduced.

The redirection of inventory follows a smaller crop of nuts produced this past season. Royal Hawaiian, which farms about 5,400 acres of macadamia trees on Hawaii island, said it produced 16 million pounds of in-shell nuts in the annual season ended June 30, down 1.4 million pounds from the prior season.

Partnership shares in Royal Hawaiian, which typically trade lightly on an over-the-counter stock exchange and are mainly held by Denver investor and former Quark Software Inc. CEO Farhad “Fred” Ebrahimi, closed at $2.39 Monday after the earnings report was filed. That compared with the previous last closing price of $2.35 Wednesday.