MILAN — Despite relatively flat fourth-quarter earnings dented by costs tied to the integration of the Oakley brand, Italy’s Luxottica Group SpA managed to post record profits in 2007.
The eyewear company also cited growth in its wholesale business worldwide in the first two months of this year and resolved to propose a dividend increase of 17 percent to 0.49 euros, or 76 cents at current exchange, a share.
Luxottica, which has licenses with Chanel, Dolce & Gabbana, Prada, and Versace among others, said net profits for the 12 months ended Dec. 31 grew 16 percent to 492.2 million euros, or $674.4 million at average exchange, on sales of 4.97 billion euros, or $6.81 billion.
Income in the fourth quarter edged up 1.1 percent to 96.7 million euros, or $140 million, compared with 95.7 million euros, or $123.4 million, in the same period in 2006.
The consolidated figures included a nonrecurring gain of 13 million euros, or $17.8 million, related to the sale of a real estate property in Milan.
Luxottica chief executive officer Andrea Guerra said he was “extremely pleased” with the company’s performance, despite “the increasingly challenging macroeconomic environment,” and cited record year-on-year results in terms of sales, operating margin (16.8 percent) and net income.
“We remain focused on generating value for our shareholders,” Guerra said.
Luxottica, which owns Ray-Ban, acquired the Foothill Ranch, Calif.-based Oakley Inc. for $2 billion in June and completed the merger in November.
Again, Guerra said he was “extremely pleased” with the speed of the Oakley integration and expected the unit to contribute “the most” during the second and third quarters of the year, “when it has historically enjoyed its strongest positive seasonality.”
Despite Luxottica’s high exposure to the U.S. market, Goldman Sachs & Co. raised the eyewear giant to a “conviction buy” last month partly on a positive view of the resilience of its optical and sunglasses business there.
In the statement, Guerra noted that last year Luxottica posted a 6 percent sales increase in North America in U.S. dollars, describing the performance of the retail division there as “satisfactory, especially when compared with that of other comparable leading retailers.”