VANCOUVER, British Columbia, Dec. 16, 2010 (GLOBE NEWSWIRE) -- Coastal Contacts Inc. ("Coastal" or "the Company") (TSX:COA) (Stockholm:COA) today announced its financial results for the fourth quarter and fiscal year ended October 31, 2010.
Sales for the fourth quarter of 2010 increased 7% to $40.5 million versus $37.7 million in the fourth quarter of 2009, and include $6 million from the eyeglasses segment. Adjusted EBITDA during the quarter was $2.0 million compared to $2.8 million in the fourth quarter of 2009. Net income for the fourth quarter of 2010 was $1.4 million or $0.03 per share, compared with $0.6 million, or $0.01 per share in the fourth quarter of 2009. Sales for the fourth quarter increased 9% compared with the fourth quarter of 2009 exclusive of exchange rate fluctuations.
Sales for the 2010 fiscal year increased 10% to a record of $153 million compared with $140 million in 2009. Sales of eyeglasses totaled $20 million, a 113% increase over Coastal's fiscal year 2009 eyeglasses sales. Revenue grew 15% excluding the effects of foreign exchange rate fluctuations. Adjusted EBITDA for fiscal 2010 was $7.8 million compared with $8.0 million for fiscal 2009. Net income for the fiscal year increased to $3.1 million or $0.05 per share compared with $2.7 million or $0.05 per share in fiscal 2009.
Mr. Roger Hardy, Coastal's President and CEO, commented, "We are pleased with our strong fourth quarter results and progress we have made throughout the year. Our emerging eyeglasses category is driving top line growth, increasing 113% over 2009. Sales of eyeglasses were $20 million in 2010 and we expect this growth trend to continue in the coming year.
Investments we have made in the eyeglasses category over the past two years are showing positive signs as we have quickly become one of the leaders in the online eyeglasses channel. We are at the leading edge of a very interesting market transition that is extremely receptive to our offering and unique value proposition. It remains day one in terms of the impact that online retailing will have on the $37 billion eyeglasses market. We are positioned to make significant advancements this year as we continue to make strategic investments to expand our manufacturing, warehousing, and distribution capabilities.
We believe having more than 2.8 million vision corrected customers in our system, provides Coastal with a clear advantage in the online eyeglasses category, allowing us to acquire eyeglasses customers more cost effectively than other competitors.
Our core contact lens business continues to show predictable recurring sales as more than 71% of orders this year were from repeat customers. Coastal's contact lens business grew 7% during the year, exclusive of exchange rate fluctuations, outpacing the growth of the contact lens industry. While we continue to invest in this important category, we are directing more of our growth investments toward our eyeglasses offering which targets a market almost ten times the size of the contact lens market and one which we believe will prove more lucrative over the long term."
The Company noted the following financial highlights for 2010:
COASTAL CONTACTS INC. CONSOLIDATED BALANCE SHEETS (CAD $000's)
- Total order volume was approximately 1.6 million orders in fiscal 2010, a 17% increase over fiscal 2009.
- Sales increased to $153 million in fiscal 2010, an increase of 10% over the previous year (15% excluding the impact of foreign exchange rate fluctuations).
- Eyeglasses sales increased 113% to $20 million in 2010.
- Sales in Canada and the United States increased 36% to $61 million in 2010.
- Repeat orders accounted for more than 71% of total orders.
- Gross margins were 29% of sales compared with 31% in fiscal 2009.
- Cash balance of $18.3 million at the end of fiscal 2010 compared with $11.5 million at the end of fiscal 2009.
- Purchased and cancelled approximately 1.7 million shares of the Company's common stock during fiscal 2010 under the terms of the approved Normal Course Issuer Bid.
As at October 31 20102009 ASSETS Current Cash and cash equivalents $18,266$11,532Accounts receivable 8,8667,965Inventory 17,53615,701Other current assets 3,4102,015 48,07837,213 Property, equipment and leasehold improvements 5,5582,813Intangibles and Goodwill 16,62317,274 $70,259$57,300
LIABILITIES Current Accounts payable and accrued liabilities $27,012$17,908Other current liabilities 943615 27,95518,523 Capital lease obligation 2,508 --Other liabilities 425 --Future income tax 3,3593,614 34,24722,137
SHAREHOLDERS' EQUITY Shareholders' equity 36,01235,163 $70,259$57,300
COASTAL CONTACTS INC.CONSOLIDATED STATEMENTS OF EARNINGS (CAD $000's) Years ended October 3120102009 Sales $ 153,166 $ 139,870 Cost of sales109,39097,009Gross profit43,77642,861 Advertising18,06918,098Selling, general and administration 19,70816,758Amortization 2,2722,585Share-based compensation 485694Interest expense (income)96(67)Foreign exchange (gain) loss97(110)Listing costs--906
Earnings before income taxes3,0493,997Income tax expense (recovery)(53)1,250
Net earnings3,1022,747 Basic net earnings per share $ 0.05 $ 0.05Diluted net earnings per share $ 0.05 $ 0.05
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