A.T. Cross said its consolidated sales for the first quarter increased 11.3% to $36.3 million on strong growth at its Costa del Mar sunglass business.


Sales at the Cross Optical Segment, which included five days of sales from recently acquired Native Eyewear, increased 23.5% to $9.7 million, compared to the same period last year.

 

The Cross Accessory Division, which includes the company's well-known line of pens and other products, recorded revenue of $26.5 million, up 7.4% compared to the same period last year.

Gross margin fell 130 basis points to 55.1%. The company still expects full year gross margins to improve 100 basis points over 2007. Operating expenses were $19.0 million, or 52.3% of sales in the quarter, versus $18.1 million, or 55.5% of sales for the same period a year ago. This ratio improvement was driven by an ongoing focus on cost control and the achievement of some economies of scale on the sales growth. Consolidated operating income in the first quarter was $1.0 million versus $0.3 in the first quarter of last year.


Net income for the first quarter, which is the company’s seasonally slowest period, was $0.6 million, or $0.04 per diluted share, compared to $0.1 million, or $0.01 per diluted share, last year.


“The global diversification of the Cross business and the power of both the Cross and Costa Del Mar brands continue to protect our opportunity,” said David G. Whalen, President and CEO. “We believe that the stage is set for another successful year for our company.”


ATX said it raised its target for net sales growth to 10% to 12% versus a prior range of 6% to 8% to reflect the acquisition of Native. It also said it now believes an appropriate target for full year 2008 earnings per share would be in the range of $0.49 to $0.51. ATX said it still believes Native’s contribution to earnings per share in fiscal 2009 wll be approximately $0.07 per share.

 
















































































































































































































































































































































































































































































































A. T. CROSS COMPANY
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share amounts)
(unaudited)
                     
         
Three Months Ended
March 29, 2008 March 31, 2007
 
Net sales $ 36,257 $ 32,572
Cost of goods sold     16,286       14,200  
Gross Profit 19,971 18,372
Selling, general and administrative expenses 16,734 15,879
Service and distribution costs 1,651 1,454
Research and development expenses 573 599
Restructuring charges     –       152  
Operating Income 1,013 288
Interest and other (expense) income     (47 )     (40 )
Income Before Income Taxes 966 248
Income tax provision     364       125  
Net Income $   602   $   123  
 
Net Income per Share:
Basic   $ 0.04     $ 0.01  
Diluted   $ 0.04     $ 0.01  
 
Weighted Average Shares Outstanding:
Basic     15,070       14,778  
Diluted     15,423       15,303  
                     
 
Three Months Ended
March 29, 2008 March 31, 2007
Segment Data: Cross Accessory Division
Net Sales $ 26,529 $ 24,693
Operating Loss (17 ) (367 )
 
Segment Data: Cross Optical Group
Net Sales $ 9,728 $ 7,879
  Operating Income           1,030           655