Benefiting from a tax refund and a more than 50% expansion of its retail sales, Oakley Inc more than tripled its first quarter profits.

In the three months ended 31 March, net income totalled US$5.7m, or $0.08 a diluted share, versus $1.9m, or $0.03, during its 2006 counterpart. The analyst consensus estimate for the most recent period was $0.03.

A tax refund added $0.01 to EPS for the quarter and led the company to raise full-year guidance to net income of $0.95 to $0.98 a diluted from a range of $0.94 to $0.97.

Net sales grew 31.3% to $199.2m from $151.7m in last year's quarter. Analysts had expected volume of $181.25m.

Retail sales grew 55.7% to $45.7m, outpacing the 25.4% leap in wholesale business, which finished the three months at $153.5m.

Looking at the business by product category, optics were up 35% to $144.3m and apparel, footwear and accessories up 9.7% to $40.4m.

Gross margin improved to 54.3% of sales from 53.1%.

"Our strong first quarter results are a reflection of Oakley's renewed focus on optics, solid growth and execution in our own retail, contribution from our acquisitions, and the successful implementation of process changes that allowed earlier shipment of our spring 2007 product," said Scott Olivet, chief executive officer of the Foothill Ranch, California-based company.

"We set a high bar for ourselves in our target 2007 revenue and EPS growth and are pleased that we are off to a strong start."
 
By Arnold J Karr.