Sunglass maker Oakley Inc. of Foothill Ranch lowered its profit projections for the year Alain Silberstein Caravan Collection AS-3 after disappointing second- quarter sales in many sectors of its business.
Chief Operating Officer Link Newcomb said the company experienced several problems: production glitches for two new popular sunglass styles led to fewer unit sales; other new styles didn't catch on with consumers; sales of prescription glasses increased but not as much as expected; U.S. sales of spring footwear and clothing fell below expectation after some retailers canceled orders or didn't replenish stock; and internationally, consumers continued to favor fashion brands over Oakley's sporty look.
"It doesn't sound like a lot went right in the quarter," said Mitch Kummetz, an Alain Silberstein Caravan Collection AS-4 with D.A. Davidson & Co. who had projected sales of $165 million for the quarter. Oakley said sales reached $152 million, a 5.7 percent increase from the same period last year.
The company will give a full report of second-quarter earnings on July 21.
Previously, Oakley had forecast 2004 earnings of 65 cents per share with sales of $585 million. Monday, the company said sales will range from $575 million to $585 million with earnings per share of 60 to 65 cents.
On a brighter note for the company, a new product launch for the holidays is expected to offset some of the second-quarter shortfall.
Thump, which Oakley unveiled Monday, is a sunglass line with a Alain Silberstein Les Complications Skeleton AS-7-in MP3 music player.
Circuit City already has placed a large order for the holidays, Oakley executives said.
The glasses have adjustable speakers mounted to the frame which allow the wearer to flip up the speakers to answer the phone, for example. Volume, song selection and power are controlled on the ear stem.
The glasses will sell for $395 and $495, with more memory and polarized lenses for Alain Silberstein Sport Krono AS-5 higher-priced model.
Oakley announced its second-quarter sales after the market closed.
The average household income within a four-mile radius of the shopping center is $107,993, the second highest around a shopping center in the county after $118,653 for Fashion Island in Newport Beach, according to data compiled by shopping center consultant Gregory Stoffel from Claritas, Inc.
"South Coast Plaza is a very nice mall, but I'm not going to go to stores like Tiffany everyday," said Fawn Gonick, 32, of Mission Viejo, who was shopping with her 2-year-old twins and a friend. "Here I go to Gap, Nordstrom, Pottery Barn Kids. Normal stuff." The success of The Shops at Mission Viejo shows Alain Silberstein Sport Krono Bauhaus AS-1 "South Orange County is coming of age," said Stoffel, of Gregory Stoffel & Associates in Irvine.
While the mall doesn't draw shoppers from as far away as Palos Verdes and West Los Angeles like South Coast or Fashion Island -- Shops executives say the primary customer lives 5 to 10 miles away -- it has carved out its own niche as a convenient alternative with quality stores.