Odimo Q2 Net Sales, Losses Rise

Odimo, the online retailer operating diamond.com, ashford.com, and worldofwatches.com, reported second quarter net sales increased 11.3 percent to $11.5 million, while registering a net loss of $3.3 million.

For the first half of the year, net sales increased 16.9 percent to $24.2 million, compared to $20.7 million, while loss from operations was $6 million, down from $7.9 million.

Diamond and jewelry sales increased at the expense of luxury and watch items. Diamond sales during the quarter were 32.5 percent of gross sales, up from 29.7 percent in the second quarter of fiscal 2004, and jewelry sales were 18.6 percent of gross sales, compared to 14.2 percent.

Luxury goods sales were 12.1 percent of gross sales, down from 15.1 percent and watch sales were 36.8 percent, decreasing from 41 percent during the second quarter of 2004.

“We successfully increased our mix of diamond and jewelry sales through the first six months of the year and drove higher average order values,” stated President and CEO Alan Lipton.

“At the same time, we implemented actions to more effectively direct our marketing spend while stabilizing the growth in advertising and general and administrative costs. This should benefit us during the balance of the year,” he said, adding that he believes marketing initiatives will expand their market share in the holiday season.

One such initiative is a re-launch of diamond.com planned to take place during the third quarter. The re-launched site will include “enhanced features”.

Marketing expenses for the quarter were $1.8 million, an increase of half a million dollars compared to the second quarter of last year. The company said the increase reflected its focus on customer acquisition, increasing the rate of repeat sales through the company's e-mail and retention marketing programs, and increases in on-line advertising costs.

Odimo expects marketing expenses for the fiscal year to total $7.5 million.