Oakley Basks in 67% Gain Amid Retail Gloom

Sunglass maker Oakley Inc. said Wednesday that strong global sales pushed earnings up 67% to a record, exceeding analysts’ projections for the fifth consecutive quarter.

The Foothill Ranch company’s upbeat performance came despite the generally rocky retail environment and growing caution among consumers.

“You have to start thinking that maybe this company is more recession-proof than we thought,” said Eric Beder, an analyst with Ladenburg Thalmann & Co.. “Even with a slowdown in the economy, they’re doing great.”

Net income for the three months rose to $9.1 million, or 13 cents a share, from $5.5 million, or 8 cents a share, a year earlier. Analysts on average had expected the company to earn 11 cents a share.

Sales rose 49% to $93.8 million, also a record.

Based on the strong first quarter and on its backlog of orders, the company nudged up its annual earnings expectations to 98 cents a share from 95 cents. Analysts had expected earnings of 96 cents a share for the year.

The record revenue was fueled by strong sunglass sales, including the X Metal style that Tom Cruise wore in last year’s blockbuster film “M:I-2.”

Oakley said it increased production capacities in the first quarter to meet increased demand for the X Metal styles and to support the launch of a new style, called Penny.

As it has geared up production, Oakley has beefed up its work force. At the end of last month, the company had 1,600 workers--including 1,100 in Orange County--an increase of 36% from a year ago.

While the first quarter is not typically a strong period for sunglass sales, analysts say Oakley has been gaining market share as it continues to crank out trendy new styles.

Oakley’s main competitor in the high-end sunglass market is Luxottica Group, owner of the Ray Ban brand. The Italian sunglass maker also recently took ownership of Sunglass Hut. Although sunglass sales accounted for 69% of all revenue, sales in Oakley’s new product categories--which include shoes, apparel, watches and prescription eyewear--more than tripled.

Analysts say the new prescription eyewear business holds particular promise for Oakley because that market is four times larger than sunglasses sales in the U.S.

Oakley’s stock, which has risen more than 96% over the past year, closed Wednesday at $18.85, up 25 cents a share, on the New York Stock Exchange.