Oakley's quarterly sales reached the magic level of $100 million - $100,013,000 to be precise - for the first time in its history in the 3-month period ended June 30. That was 39 percent more than in the comparable period a year ago, with sales increases of 38 percent in the USA and 40 percent elsewhere. Sales of sunglasses reached 1,568,685 pairs worth $88,845 before discounts, taking the total for the first 6 months up to 2,528,105 pairs worth $141,441,000.
All key markets, including Europe, contributed to the growth. In the USA, sales to specialty stores increased by 48 percent, with sales to Sunglass Hut, Oakley's largest customer, rising for the first time in more than year. Overall, sales of prescription eyewear grew by 121 percent. Internet and telesales reached $1.7 million.
The order backlog has nearly doubled from one year ago to just under $42 million, but the management warns that sales of sunglasses are not going to enjoy the same high growth rate as in the first half over the balance of the year. Demand for Oakley's X Metal frames has exceeded the company's production capacity. Retailers have placed higher orders for ski goggles, apparel and footwear for fall. The footwear division, which was previously losing money, started to generate a profit in June and should remain profitable in the second half.
The gross margin has improved to 66.7 percent in the second quarter from 64.9 percent in the year-ago period. The operating income is up to $29,186,000 for the quarter, as compared to $16,888,000, representing a margin of 23.4 percent. The net income has improved to $18,457,000 from $10,617,000. For the whole first half, the net income is up to $23,929,000 on sales of $163,099,000 from $12,026,000 on sales of $120,797,000.