Orange 21 Inc., the parent company to Spy Optics, reported that consolidated net sales declined 34.8% to $9.1 million for the second quarter compared to net sales of $14.0 million for the three months ended June 30, 2008. Management said that the ongoing recession was the primary reason for declining sales.


During the most recent quarter, Orange 21 reduced total operating expenses by approximately $2.6 million from the same period last year, and although the company had a significant decrease in sales, it has continued to maintain “relatively strong” gross profit margins. Gross margins declined 370 basis points to 45.9% of sales compared to 49.7% in the same quarter of 2008.


The company incurred a net loss of $254,000 for the quarter, compared to a net loss of $273,000 for the same quarter last year. The net loss in 2009 included $129,000 in non-cash share-based compensation costs.