Online diamond and jewellery retailer Blue Nile has confirmed the location of its second bricks-and-mortar store while revealing a double-digit decline in Australian sales in 2015.
For the fourth quarter ended 3 January 2016, Blue Nile’s global net sales decreased 4.8 per cent to US$150 million (AU$209.4 m) compared with the previous corresponding period ended 4 January 2015. Net income, however, increased 4.2 per cent to US$5 million (AU$7 m).
Blue Nile chairman, CEO and president Harvey Kanter described the results as “disappointing”, stating, “Revenue growth was challenged by continued weakness from high-ticket purchases and foreign currencies, as well as lower selling prices for our core engagement products.”
The company’s full year results were more positive. Global revenue increased 1.4 per cent to US$480.1 million (AU$670.3 m) compared with the previous fiscal year.
Blue Nile’s US engagement sales lifted 1.3 per cent to US$269.9 million (AU$376.6 m) in 2015. US non-engagement sales similarly rose 1.8 per cent to US$128.3 million (AU$179 m).
International net sales – which represented 17.1 per cent of the company’s total 2015 revenue – showed a small improvement, increasing 1 per cent to US$81.9 million (AU$114.3 m) on the previous year. It was noted that excluding the impact of changing foreign exchange rates, international net sales increased 9.9 per cent.
In an earnings call, Blue Nile chief financial officer David Binder said Australia was one of the areas experiencing the “toughest currency challenges”. He stated that sales in the region had “declined by double-digits” but did not disclose a specific percentage or value.
The company’s full year net income and gross profit results were also positive, increasing 8 per cent to US$10.5 million (AU$14.7 m) and 6.6 per cent to US$92.3 million (AU$128.8 m), respectively.
Commenting on the year ahead, Kanter said, “[We] will push harder on elements that are working: engagement ring units, wedding band attach rates, continued expansion of margin, and the webroom concept.”
In support of the latter comment, Blue Nile recently announced it would open its second bricks-and-mortar ‘webroom’ in the second half of this year. The store will be located at the Westchester Mall in White Plains, New York, with Blue Nile indicating it would be the first of up to four outlets to open in 2016.
Blue Nile launched its first webroom in June 2015 at the Roosevelt Field Mall in Garden City, New York. The store acts as a physical display room, with diamond jewellery consultants on-hand for queries, but still requires customers to order product online via in-store tablets.