LKI Q1 Sales Hurt by Rough Diamonds, Net Income Up

Lazare Kaplan International net sales for the first fiscal quarter were $78.3 million, down from $102.6 million for the comparable prior year period, while polished diamond revenues were up to $40.9 million from $33.9 million. However, the DTC Sightholder was able to increase net income.

Rough diamond sales totaled $37.4 million in the quarter ended August 31, as compared to $68.7 million in the first quarter of the fiscal prior year.

Gross margin on net polished sales was 12.8% compared to 12% a year ago. Rough diamond gross margin was 3.2% compared to 6.2%.

First quarter net income was $0.9 million, or $0.10 per fully diluted share compared to $0.4 million or $0.05 per fully diluted share in the comparable prior year period.

“The global financial crisis has grown very serious and will inevitably affect the diamond and jewelry market,” said LKI CEO Leon Tempelsman. “Demand is bound to decline during the upcoming selling season as discretionary spending falls.”