Internet diamond and jewelry retailer Blue Nile reported that net sales for the first quarter of 2008, ended March 30, totaled $70.5 million—a 3.8 percent increase from $67.9 million in the first quarter of 2007. Operating income for the quarter totaled $3 million. Net income totaled $2.6 million.
Net cash provided by operating activities totaled $29.4 million for the trailing twelve month period ended March 30, 2008. Non-GAAP adjusted free cash flow was $24.2 million for the trailing twelve month period ended March 30, 2008.
Gross profit grew 5.1 percent to $13.9 million, from $13.2 million for the first quarter of 2007. Gross profit as a percentage of sales increased to 19.8 percent, compared to 19.5 percent for the first quarter of 2007.
“We are pleased to have delivered financial results that exceeded our expectations, particularly in light of the weak consumer environment in the U.S.,” said Diane Irvine, Blue Nile chief executive officer. “In this uncertain environment, we are keenly focused on enhancing the Blue Nile customer experience and vigorously managing our costs. We will invest prudently in our business and execute our unique business model to build long-term value for our shareholders.”
International sales totaled $5.7 million in the quarter, an increase of 124 percent over the first quarter of 2007.
“Our international business continued its rapid growth during the quarter, and we are extremely pleased with the early results of our recent launches into 25 new countries,” Irvine said. “Customers around the world are embracing the Blue Nile value proposition in increasing numbers.”
During the quarter, the company repurchased 990,700 shares of its common stock for $41.7 million.
Other financial highlights include:
* Selling, general and administrative expenses for the quarter were $10.9 million, compared to $9.6 million in the first quarter of 2007. Selling, general and administrative expenses include stock-based compensation expense of $1.7 million, compared to $1.2 million in the first quarter of the prior year.
* Non-GAAP adjusted EBITDA was $5.2 million for the quarter.
* The company’s cash and cash equivalents totaled $42.7 million at March 30.
* Capital expenditures in the first quarter totaled $500,000, compared to $200,000 million in the first quarter of 2007.
In a separate release Tuesday, the Seattle-based company announced the appointment of Marc Stolzman as chief financial officer. Stolzman will join the company on June 9.
As CFO, Stolzman will be responsible for all aspects of Blue Nile’s finance function, including accounting and financial reporting, financial planning and analysis, tax, treasury, and investor relations. Stolzman will report to Irvine.
Stolzman brings 20 years of financial and retail experience to his new role. Stolzman joins Blue Nile from Imperium Renewables, a national leader in next generation biodiesel refining and manufacturing technology, where he has served as CFO since March 2007. Stolzman previously spent thirteen years with Starbucks Coffee Company and held a number of executive leadership positions, including senior vice president of Finance and Business Development of Starbucks Coffee Intl. from 2003 to 2007, CFO of Starbucks Coffee Japan from 2001 to 2003, and vice president North America Finance from 1997 to 2001. Stolzman began his career at Lamonts Apparel and spent six years in various finance and treasury positions.
Stolzman received a B.A. in Business Administration from Washington State University.
“I am extremely excited that Marc will be joining Blue Nile as CFO, and I believe we will benefit immensely from his experience, passion and commitment to excellence,” Irvine said. “Marc’s depth of financial and international experience and his strong record of delivering results in a growing consumer business are tremendous attributes that will help to drive our mission of being the world’s premier diamond and jewelry retailer.”