Online jewelry, diamond and watch retailer Odimo Inc. reported a net sales increase of 11.3% to $11.5 million, as compared to $10.3 million in the second quarter of 2004.
The Sunrise, Fla.-based company that operates three Web sites (http://www.diamond.com, http://www.ashford.com, and http://www.worldofwatches.com ) is operating at loss of $3.3 million for the quarter, compared with a $1.8 million loss for the same period of the previous year.
For the first six months of 2005 the company reported a net sales increase of 16.9% to $24.2 million, compared to $20.7 million in the first six months of fiscal 2004.
Loss from operations was $6 million for the period, compared with $7.9 million loss from operations in the first half of 2004.
Gross profit for the second quarter of 2005 was $2.8 million, or 24.6% of net sales, compared to $2.9 million, or 27.8% of net sales, for the second quarter 2004. The decline in gross profit margin was due to a mix shift toward lower margin diamond sales, the company said.
Fulfillment expenses for the second quarter of fiscal 2005 were $805,000 as compared to $675,000 for the second quarter 2004. Fulfillment expenses as a percentage of net sales for the second quarter of fiscal 2005 increased to 7% compared to 6.6% for the second quarter 2004.
Other second quarter 2005 financial highlights, include:
* Diamond sales were 32.5% of gross sales, as compared to 29.7% of gross sales in the second quarter of fiscal 2004;
* Jewelry sales were 18.6% of gross sales, as compared to 14.2% of gross sales in the second quarter of 2004;
* Luxury goods sales were 12.1% of gross sales, as compared to 15.1% of gross sales in the second quarter of 2004;
* Watch sales were 36.8% of gross sales, as compared to 41.0% of gross sales in the second quarter of 2004
“We continued to advance our key strategic goals during the second quarter,” said Alan Lipton, Odimo’s president and CEO. “We successfully increased our mix of diamond and jewelry sales through the first six months of the year and drove higher average order values. At the same time, we implemented actions to more effectively direct our marketing spend while stabilizing the growth in advertising and general and administrative costs. This should benefit us during the balance of the year.
“As we look ahead, we remain enthusiastic regarding our growth prospects both in the short and long term,” he continued. “To this end, we believe our marketing and merchandising initiatives position us to expand our market share in the holiday season. During the third quarter, we have scheduled a re-launch of our diamond.com site with enhanced features and are also excited by the repeat business and new customers that we are attracting as we focus on our diamond and jewelry business.”