Luxottica Group, recently profiled on 60 Minutes for its unrivaled pricing power in the prescription eyewear market, reported record free cash flow of €271 million ($339 mm) in the third quarter ended Sept. 30 thanks to strong sales and margin growth across almost all its businesses and geographic markets.


The Italian eyewear giant, which owns the Oakley and Ray-Ban eyewear brands, said net sales reached €1.78 billion ($2.23 bb), up 6.7 percent in currency neutral (c-n) terms.  Sales grew 9 percent in Western Europe, improved in the Mediterranean and exceeded expectations in North America.


The Wholesale division's net sales rose to €646.8 million ($780 mm), or 10.7 percent in c-n terms. Operating income grew to €124.8 million ($156 mm), compared with €104.9 million ($148.4 mm) during the third quarter of 2011. Operating margin grew 40 basis points to 19.3 percent in the third quarter.

Growth was driven in part by new collections, with double-digit growth in Ray-Ban, Oakley and the luxury segment and strong overseas sales. Double-digit growth was recorded in China, Turkey, Mexico, India, Brazil and Eastern Europe. Excellent results were also achieved in Western Europe, with Nordic countries, France, Germany and the UK up double-digits in the quarter. Performance in Italy was slightly negative, while Spain returned to growth.



The Retail division’s net sales equaled €1.14 billion ($1.43 bb), up 17.3 percent year-over-year (4.4 percent c-n). Operating margin increased 140 basis points to 14.6 percent. Comparable store sales grew by 5.9 percent during the quarter, boosted by 8.8 percent comps growth at Sunglass Hut. Comp store sales grew by 8.4 percent in the U.S. and by more than 30 percent in Mexico, where LUX has made several investments over the last few months.