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Oakley Continues to Shine for Luxottica

Published February 5, 2009

MILAN, Italy (BRAIN)—Oakley’s parent company released net sales figures for 2008 on Thursday, depicting a challenging fourth quarter for the high-end eyewear company even as Oakley remained a bright spot.

Luxottica did not break out sales numbers for Oakley, but during a conference call Luxottica chief executive office Andrew Guerra said Oakley grew double digits globally last year.

Luxottica will release full year-end results, as well as fourth quarter earnings, on March 12 and will likely provide more specifics on Oakley’s performance at that time.

The company, which also owns eyewear brands like Ray-Ban, Revo, Oliver Peoples and Vogue, reported sales of 5.2 million euros in 2008, up from 4.9 million in 2007. The 4.7-percent increase is mainly due to the inclusion of Oakley sales, the company said in a press release.

“We successfully closed the first full year of integration with Oakley: despite certain changes in the distribution structure in certain markets, we managed to significantly grow the brand and its visibility, particularly in European and emerging markets, which shows its great underlying value,” Guerra said.

Guerra said prescription and custom lenses performed exceptionally well for Oakley last year.

Luxottica said it expects to post net income of 400 million euros for 2008, down 16 percent from the year before.

The fourth quarter of 2008 was particularly tough for Luxottica as the global economic downturn contributed to a slump in demand, which caused the company to miss its net profit predictions.

“After years of sustained growth, global markets are now experiencing not a crisis so much as a structural re-adjustment,” Guerra said. “Over the past five years, our Group enjoyed a near doubling in sales as well as improved overall performance and profitability, thanks to our unique business model. Now we must be as responsive and flexible as ever in adapting to the new scenario and continue on our path of growth in anticipation of a 2009 that will certainly be challenging for all.”

Next year, Luxottica will adjust its manufacturing, distribution and sales structures to the new level of demand, as well as work on cost structure in all areas of business to make it even leaner, Guerra said.

—Nicole Formosa

Topics associated with this article: Earnings/Financial Reports

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