Online diamond and jewelry retailer Blue Nile, Inc. reported net sales of $73.7 million for the second quarter of 2008, up from $72.1 million for the same period of the prior year. Net income fell to $3.2 million, compared with $3.78 million in the same period of 2007.
“We are pleased that our disciplined focus on profitability across the business enabled us to deliver earnings that exceeded our expectations,” said Diane Irvine, Blue Nile chief executive officer. “We are confident that our differentiated business model will allow us to continue to gain share and further strengthen our competitive position in the industry as we manage through a challenging economic environment in the U.S. We are focused on executing on our initiatives that will continue to enhance the Blue Nile customer experience in all areas, while capitalizing on the significant long-term opportunities for our business.”
During the quarter, the Seattle-based company repurchased 10,500 shares of its common stock. In the third quarter to date, the Company has repurchased an additional 466,400 shares of its common stock. Since the inception of the buyback program in the first quarter of 2005, the company has repurchased 4.3 million shares for a total of $155.0 million.
Financial highlights for the period, ended June 29, include:
* International sales for the second quarter grew 179 percent to $8.1 million. Blue Nile ships its products to nearly 30 countries as a result of its recently expanded shipment offering, compared to four countries one year ago.
* Gross profit for the second quarter grew to $15.1 million, or 20.5 percent of net sales, compared to $14.9 million, or 20.7 percent of net sales in the second quarter a year ago. Gross profit in the second quarter of 2007 included the benefit of a one-time refund of shipping charges, which increased gross margin by 30 basis points.
* Operating income for the quarter totaled $4.4 million. Operating margin was 5.9 percent of net sales for the second quarter.