Blue Nile Inc. (NILE, Financial) filed Quarterly Report for the period ended 2010-04-04.
Blue Nile Inc. has a market cap of $732.2 million; its shares were traded at around $50.55 with a P/E ratio of 58.1 and P/S ratio of 2.4. Blue Nile Inc. had an annual average earning growth of 8.2% over the past 5 years.NILE is in the portfolios of Ron Baron of Baron Funds, Jim Simons of Renaissance Technologies LLC.
Net sales increased 18.7% during the first quarter of 2010 as compared with the first quarter of 2009, due to an increase in the average shipment value and an increase in the number of orders shipped. Sales of our non-engagement jewelry grew at rates above our overall sales growth rate. Net sales in the U.S. increased 13.6% to $64.5 million for the quarter, compared with $56.8 million for the same quarter last year. International sales increased 71.4% to $9.6 million, from $5.6 million in the prior year first quarter. Changes in foreign exchange rates during the first quarter of 2010, compared to the rates in effect during the first quarter of 2009, had a positive impact of approximately 19.6% on international sales. Excluding the impact of changes in foreign exchange rates, international sales increased 51.8% for the first quarter of 2010 compared to the first quarter of 2009.
Selling, general and administrative expenses increased 18.7% to $12.2 million in the first quarter of 2010 compared to $10.3 million in the first quarter of 2009 due to several factors. Marketing and advertising costs increased $0.7 million in the first quarter of 2010, primarily due to increased spending on online marketing vehicles compared to prior year levels. Payroll and related expenses increased $0.6 million primarily due to increased headcount to support key business initiatives and the growth in operations. Credit card interchange and payment processing fees increased approximately $0.2 million due to higher sales volumes. These increases, as well as increases in other categories that were not individually material for disclosure, attributed to higher expenses in the first quarter of 2010. As a percentage of net sales, selling, general and administrative expenses were 16.5% in the first quarter of 2010 and in the first quarter of 2009.
As of April 4, 2010, working capital totaled $21.5 million, including cash and cash equivalents of $47.2 million and inventory of $21.3 million, partially offset by accounts payable of $46.8 million. We believe that our current cash and cash equivalents as well as cash flows from operations will be sufficient to continue our operations and meet our capital needs for the foreseeable future.
Net cash of $30.7 million was used in operating activities for the quarter ended April 4, 2010, compared to net cash used in operating activities of $21.4 million for the quarter ended April 5, 2009. Net payment of payables totaled $29.3 million for the quarter ended April 4, 2010 and $26.8 million for the quarter ended April 5, 2009. In the first quarter, we generally have a significant pay down of our accounts payable balance built up during the fourth quarter holiday season. The volume of sales in the fourth quarter of 2009 was higher than the volume of sales in the fourth quarter of 2008, resulting in a higher net payment of payables in the first quarter of 2010 compared to the first quarter of 2009. Working capital used in the payment of accrued liabilities increased to $5.5 million in the quarter ended April 4, 2010 from $1.3 million in the quarter ended April 5, 2009 due to the timing of federal income tax, employee compensation and credit card interchange fee payments.
During the quarter ended April 4, 2010, we repurchased 292,100 shares of our common stock for an aggregate purchase price of $15.2 million. In February 2008, our board of directors authorized the repurchase of up to $100 million of Blue Nile, Inc. common stock during the 24-month period following the approval date of such repurchase. On February 9, 2010, our board of directors authorized the repurchase of up to $100 million of the Companys common stock during the 24-month period following the approval date of such repurchase. As of April 4, 2010, approximately $100 million remains under this repurchase authorization. Since the inception of our buyback program in the first quarter of 2005 through April 4, 2010, we have repurchased 4.7 million shares for a total of $176.4 million. The shares may be repurchased from time to time in open market transactions or in negotiated transactions off the market. The timing and amount of any shares repurchased is determined by management based on our evaluation of market conditions and other factors, including our cash needs. Repurchases may also be made under a Rule 10b5-1 plan. We continually assess market conditions, our cash position, operating results, current forecasts and other factors when making decisions about stock repurchases.
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Blue Nile Inc. has a market cap of $732.2 million; its shares were traded at around $50.55 with a P/E ratio of 58.1 and P/S ratio of 2.4. Blue Nile Inc. had an annual average earning growth of 8.2% over the past 5 years.NILE is in the portfolios of Ron Baron of Baron Funds, Jim Simons of Renaissance Technologies LLC.
Highlight of Business Operations:
During the first quarter, our year-over-year net sales increased 18.7% to $74.1 million from $62.4 million in the first quarter of last year. Net sales increased in all of our significant markets, with our international markets growing 71.4%. Our gross profit as a percentage of net sales increased to 21.3% in the first quarter of 2010, compared with 21.2% for the first quarter of 2009. Our net income rose 23.1% to $2.4 million or $0.16 per share for the first quarter of 2010, compared to $1.9 million or $0.13 per share for the first quarter of 2009. As of April 4, 2010, we had cash and cash equivalents of $47.2 million and no debt.Net sales increased 18.7% during the first quarter of 2010 as compared with the first quarter of 2009, due to an increase in the average shipment value and an increase in the number of orders shipped. Sales of our non-engagement jewelry grew at rates above our overall sales growth rate. Net sales in the U.S. increased 13.6% to $64.5 million for the quarter, compared with $56.8 million for the same quarter last year. International sales increased 71.4% to $9.6 million, from $5.6 million in the prior year first quarter. Changes in foreign exchange rates during the first quarter of 2010, compared to the rates in effect during the first quarter of 2009, had a positive impact of approximately 19.6% on international sales. Excluding the impact of changes in foreign exchange rates, international sales increased 51.8% for the first quarter of 2010 compared to the first quarter of 2009.
Selling, general and administrative expenses increased 18.7% to $12.2 million in the first quarter of 2010 compared to $10.3 million in the first quarter of 2009 due to several factors. Marketing and advertising costs increased $0.7 million in the first quarter of 2010, primarily due to increased spending on online marketing vehicles compared to prior year levels. Payroll and related expenses increased $0.6 million primarily due to increased headcount to support key business initiatives and the growth in operations. Credit card interchange and payment processing fees increased approximately $0.2 million due to higher sales volumes. These increases, as well as increases in other categories that were not individually material for disclosure, attributed to higher expenses in the first quarter of 2010. As a percentage of net sales, selling, general and administrative expenses were 16.5% in the first quarter of 2010 and in the first quarter of 2009.
As of April 4, 2010, working capital totaled $21.5 million, including cash and cash equivalents of $47.2 million and inventory of $21.3 million, partially offset by accounts payable of $46.8 million. We believe that our current cash and cash equivalents as well as cash flows from operations will be sufficient to continue our operations and meet our capital needs for the foreseeable future.
Net cash of $30.7 million was used in operating activities for the quarter ended April 4, 2010, compared to net cash used in operating activities of $21.4 million for the quarter ended April 5, 2009. Net payment of payables totaled $29.3 million for the quarter ended April 4, 2010 and $26.8 million for the quarter ended April 5, 2009. In the first quarter, we generally have a significant pay down of our accounts payable balance built up during the fourth quarter holiday season. The volume of sales in the fourth quarter of 2009 was higher than the volume of sales in the fourth quarter of 2008, resulting in a higher net payment of payables in the first quarter of 2010 compared to the first quarter of 2009. Working capital used in the payment of accrued liabilities increased to $5.5 million in the quarter ended April 4, 2010 from $1.3 million in the quarter ended April 5, 2009 due to the timing of federal income tax, employee compensation and credit card interchange fee payments.
During the quarter ended April 4, 2010, we repurchased 292,100 shares of our common stock for an aggregate purchase price of $15.2 million. In February 2008, our board of directors authorized the repurchase of up to $100 million of Blue Nile, Inc. common stock during the 24-month period following the approval date of such repurchase. On February 9, 2010, our board of directors authorized the repurchase of up to $100 million of the Companys common stock during the 24-month period following the approval date of such repurchase. As of April 4, 2010, approximately $100 million remains under this repurchase authorization. Since the inception of our buyback program in the first quarter of 2005 through April 4, 2010, we have repurchased 4.7 million shares for a total of $176.4 million. The shares may be repurchased from time to time in open market transactions or in negotiated transactions off the market. The timing and amount of any shares repurchased is determined by management based on our evaluation of market conditions and other factors, including our cash needs. Repurchases may also be made under a Rule 10b5-1 plan. We continually assess market conditions, our cash position, operating results, current forecasts and other factors when making decisions about stock repurchases.
Read the The complete Report
