Oakley to combat fall

A wet summer in Europe was blamed for Oakley's sluggish third-quarter sales. However, with American troops based in Iraq, as one of two approved sellers to the United States army, the US optical business expects to generate 'substantial sales' of the company's newly developed combat eyewear in the near future. That, plus innovative audio eyewear which the business hopes to sell globally, has given the business hope for an improvement during the rest of the year. The worldwide sunglass brand, which has two Oakley Vault stores in Portsmouth and York, reported a quarterly income of $11.4m for the three months to September 30, down from $13.5m a year ago. Overall sales for the year also have failed to keep pace, with the nine months of 2004 amounting to $31.5m, compared to 2003's $35m. Chief operating officer Link Newcomb said the core sunglass business had faced a 'challenging' three months this summer. 'A weak retail environment in Europe and the South Pacific Ð and a wet summer in Europe Ð combined with increased competitive pressure from competing fashion brands in some markets, contributed to a substantial decline in sunglass sales.' Sales of sunglasses through Sunglass Hut stores slowed during the quarter, he reported, as the summer Oakley 'front-door' campaign failed to generate the 'expected momentum'. Nevertheless, new styles for 2004 made a bigger impact than last year's styles and sales of polarised product made a higher contribution. Newcomb was upbeat about the deal with the US army, and the US launch of its audio eyewear, Oakley Thump. 'We believe we are poised for a strong fourth quarter,' he said, 'thanks to the upcoming launch of Oakley Thump, the company's innovative integrated digital audio eyewear, through a select group of leading retail partners in the US and key international markets. 'In addition, we expect our approved vendor status with the US army to generate substantial sales of the company's newly developed combat eyewear in the near future. As a result, we expect substantial earnings growth in the fourth quarter and are reiterating our full year 2004 net sales guidance of $575m to $585m.'