MILAN--The expenses involved in integrating Oakley’s operations, acquired for $2.1 billion last June, led Luxottica Group (NYSE: LUX) to post its first decline in quarterly profits in the past nine quarters for fiscal 2007’s Q4. However, its income for the full year rose 14.3 percent, to a record €492 million, the company said last week.

Andrea Guerra Luxottica

For the fourth quarter, Luxottica’s consolidated net income was €97 million, 4 percent below the same period in FY 2006. Operating income for the company’s retail division was off 31.7 percent in Q4, to €59 million, while its wholesale division saw its operating income rise 5.5 percent to €110 million.

In the full year 2007, Luxottica’s retail division had operating income of €362 million, 16.2 percent below FY 2006; its wholesale division’s operating income rose 18.4 percent to €528 million.

As previously reported, Luxottica’s consolidated net sales for FY 2007 were just under €5 billion, up 6.2 percent at constant currency rates; sales in Q4 rose 7.1 percent at constant currency rates, to €1.2 billion.

Looking at the company’s full-year performance, Luxottica’s chief executive officer, Andrea Guerra, said, “With respect to North America, we are especially pleased with the performance of our overall business in that market, which posted a 6 percent growth in sales in U.S. dollars for the year. In particular, the performance of the retail division in that market was satisfactory, especially when compared with that of other comparable leading retailers in that market.”

As for results so far in 2008, Guerra said, “During the first two months of the current year, our wholesale business is showing growth in all markets worldwide, while the retail business remains steady overall. With respect to the Oakley business, we continue to be extremely pleased with the speed at which we are completing many strategic projects. Going forward, we are expecting that this business will contribute the most during the second and third quarters of the year, when it has historically enjoyed its strongest positive seasonality.”
 
Last week, Luxottica’s board authorized a stock repurchase program for up to 18.5 million of the company’s stock, representing 4 percent of outstanding shares. That authorization “is intended to provide the company with treasury shares in order to efficiently manage the company’s capital and to implement the performance share plan to be granted to the group’s top managers,” an announcement said. ■