I’m still catching up on first quarter results that were released during my travels this month. Here are the first quarter results for Orange 21 Inc., the parent company of Spy.
Sales: Orange 21 reported a 23 percent increase in sales to $11.6 million during the first quarter. The company attributed the increase to increased sales and marketing efforts, an improvement in product mix and availability and increased prices. The results include $898,000 in revenue from LEM, the Italian manufacturing business Orange 21 owns.
Net loss: The company reported a net loss of $0.9 million vs. a net loss of $1.7 million for the same period last year. Orange 21 has never recorded a full year profit since its initial public offering according to its financial statements.
Gross profit: Gross profit as a percentage of sales decreased to 47 percent vs. 52 percent. The decrease was attributed to increased materials costs from rising gas and oil prices and and an increase in Euro foreign exchange rates. Those increases were offset by a decrease in outsourcing costs at LEM.
Streamlining manufacturing: The company is in the process of streamlining its Italian manufacturing operations to save money in the long run. The plan entails consolidating into a single building and buying new equipment.
The company has placed orders for the equipment, and the still needs to pay 1.35 million Euros. Orange 21 also expects additional costs associated with consolidating into a single location and will need to borrow the money. If the company can’t get acceptable financing, it may not proceed with the streamlining plan.
