Orange 21 Inc. reported consolidated net sales for the three months ended Sept. 30, 2009 were $8.8 million compared to net sales of $12.0 million for the three months ended Sept. 30, 2008. 

The company incurred a net loss of $1.1 million for the quarter as compared to a net income of $6,000 for the year-ago period. The net loss for the quarter included a $0.7 million increase in inventory reserves for slow moving and obsolete inventory and $115,000 in non-cash share-based compensation costs in accordance with FASB authoritative guidance.
Cash generated from operating activities during the quarter was $2.1 million and total cash generated during the prior comparable period was $0.4 million.

�€�The current recession continues to have a significant impact on the retail environment and our global sales. As such we will continue to control costs and improve operational efficiencies where possible to minimize future possible losses,�€� commented Stone Douglass, the Company�€�s Chief Executive Officer. �€�During the most recent quarter, we reduced total operating expenses by approximately $1.9 million from the same period last year and expect to continue to benefit from cost savings efforts during the fourth quarter of 2009.�€� Concluding, Mr. Douglass added, �€�We are very excited about possible new opportunities that are unfolding for Orange 21 and its shareholders and look forward to rolling out our O�€�Neill Eyewear offerings in 2010.�€�