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Orange 21 Reports Third Quarter 2005 Financial Results; Third Quarter Net Sales of $10.8 Million, an 8.4% Year-over-Year Increase; Third Quarter EPS of $0.02 Compared to $0.10 Per Share in the Third Quarter of 2004

CARLSBAD, Calif.--(BUSINESS WIRE)--Nov. 14, 2005--Orange 21 Inc. (NASDAQ: ORNG), a leading developer of brands that produce premium products for the action sport and youth lifestyle markets, today announced financial results for the three months ended September 30, 2005.

The Company's net sales for the third quarter of 2005 increased 8.4% to $10.8 million compared to $10.0 million in the third quarter of 2004, meeting the high end of the Company's previously announced estimate. The Company reported net income for the third quarter of 2005 of approximately $192,000, compared to net income of approximately $517,000 in the third quarter of 2004. Earnings per diluted share for the third quarter were $0.02 on approximately 8.3 million weighted average shares outstanding compared to $0.10 per share on approximately 5.1 million weighted average shares outstanding in the same period a year ago.

Cash, cash equivalents, and short term investments at September 30, 2005, totaled approximately $10.8 million.

"Although our earnings for the third quarter were less than expected we are pleased with our year to date increase in revenue of approximately 24%. While our third quarter results were adversely impacted by delays in manufacturing, lower than expected sales in our E Eyewear product line, changes to several international distributors, and continued weakness in the U.S. dollar relative to the Euro, we are excited about the continuing global sales growth in the brand," said Barry Buchholtz, Chief Executive Officer. "We have experienced growing pains during our first year as a public company, but despite these near-term challenges, we remain optimistic about 2006 and beyond, as we believe we are taking the right strategic initiatives to achieve our sales growth and margin improvement goals. Our core brand is well positioned, and we believe our popular existing styles combined with the many new products we've announced will drive sales momentum."

2005 Outlook

The Company previously announced 2005 annual revenue guidance in the range of $41.5 - $42.5 million and fully diluted earnings per share in the range of $0.05 - $0.09. The guidance includes an estimated $0.02 of dilution from the previously announced acquisition of Orange 21's eyewear manufacturer LEM, and an estimated $0.01 to $0.02 reduction attributable to the costs of the Oakley and Class Action law suits.

Investor Conference Call

Orange 21's quarterly earnings conference call is scheduled to begin today, Monday, November 14, 2005 at 1:30 p.m., Pacific Standard Time. The conference call will be broadcast live over the Internet. Investors may listen to the live webcast at www.orangetwentyone.com. For those who are not available for the live broadcast, the call will be archived on Orange 21's investor website.

About Orange 21 Inc.

Orange 21 develops brands that produce premium products for the action sport and youth lifestyle markets. Orange 21's brands include Spy Optic(TM), which manufactures sunglasses and goggles targeted towards the action sports and youth lifestyle market, and E Eyewear(TM), which manufactures the signature Dale Earnhardt, Jr. sunglass line.

Safe Harbor Statement

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: This press release and the company's quarterly conference call to be held on November 14, 2005 contain forward-looking statements and forecasts about Orange 21 and its business, such as management's estimates of net sales, earnings and expenses for 2005. Because forecasts are inherently estimates that cannot be made with precision, the company's actual results may differ from its estimates and those differences may be material.

Statements in this press release and in the quarterly conference call regarding financial guidance, expectations regarding sales growth, margin improvements, future strength of the brand and products, the closing of the LEM transaction, and other statements that refer to Orange 21's estimated and anticipated results are forward-looking statements. All such forward-looking statements reflect Orange 21's current analysis of existing trends and information and represent Orange 21's judgment only as of the date of this press release. Actual results may differ from current expectations based on a number of factors affecting Orange 21's business, including but not limited to, demand for the company's products; uncertainties associated with Orange 21's ability to maintain a sufficient supply of products and to successfully manufacture its products; the performance of new products and continued acceptance of current products; the execution of strategic initiatives and alliances; the impact of ongoing litigation; satisfaction of the applicable closing conditions for the LEM transaction; uncertainties associated with intellectual property protection for the Company's products; matters generally affecting the domestic and global economy, including changes in interest rates and currency exchange rates; and other factors described in the Company's filings with the U.S. Securities and Exchange Commission, including its most recent quarterly report on Form 10-Q. Therefore, the reader is cautioned not to rely on these forward-looking statements. Orange 21 disclaims any intent or obligation to update these forward-looking statements.

                   Orange 21 Inc. and Subsidiaries
                Consolidated Statements of Operations
                             (unaudited)

                      Three months ended        Nine months ended
                          September 30,            September 30,
                    ------------------------ -------------------------
                       2004        2005         2004         2005
                    ----------- ------------ ------------ ------------

Net sales           $9,977,364  $10,819,773  $24,028,325  $29,707,956
Cost of sales        4,619,500    5,310,534   10,930,375   14,494,701
                    ----------- ------------ ------------ ------------

Gross Profit         5,357,864    5,509,239   13,097,950   15,213,255
                    ----------- ------------ ------------ ------------

Operating expenses:
  Sales and
   marketing         3,048,848    3,462,546    7,875,932    9,381,103
  General and
   administrative    1,069,485    1,368,080    3,242,121    4,223,149
  Shipping and
   warehousing         315,642      334,917      670,313      924,508
  Research and
   development          96,474      160,562      283,679      475,018
                    ----------- ------------ ------------ ------------

    Total operating
     expenses        4,530,449    5,326,105   12,072,045   15,003,778
                    ----------- ------------ ------------ ------------

  Income from
   operations          827,415      183,134    1,025,905      209,477

Other income
 (expense)
  Interest (expense)
   income - net        (90,680)      85,632     (324,930)     236,045
  Foreign currency
   transaction gain    242,884      165,933       97,170       66,345
  Other income
   (expense) - net      48,747        4,704       48,572       (7,917)
                    ----------- ------------ ------------ ------------
    Total other
     income
     (expense)         200,951      256,269     (179,188)     294,473
                    ----------- ------------ ------------ ------------
    Income before
     income taxes    1,028,366      439,403      846,717      503,950
Income tax provision   511,442      247,293      761,401      444,451
                    ----------- ------------ ------------ ------------
  Net income          $516,924     $192,110      $85,316      $59,499
                    =========== ============ ============ ============
Net earnings per
 common share
  Basic                  $0.11        $0.02        $0.02        $0.01
                    =========== ============ ============ ============
  Diluted                $0.10        $0.02        $0.02        $0.01
                    =========== ============ ============ ============
Weighted average
 common shares
 outstanding
  Basic              4,898,246    8,026,502    4,570,556    8,014,352
                    =========== ============ ============ ============
  Diluted            5,073,466    8,339,792    4,745,788    8,407,376
                    =========== ============ ============ ============


                   Orange 21 Inc. and Subsidiaries
                     Consolidated Balance Sheets

                                             December 31,  September
                                                               30,
                                                 2004         2005
                                             ------------ ------------
Assets                                                    (unaudited)
Current assets
Cash and cash equivalents                    $11,476,828   $1,693,042
Short-term investments                                 -    9,075,502
Accounts receivable--net                       8,244,910    8,445,387
Inventories                                   11,814,846   13,015,212
Prepaid expenses and other current assets      1,073,181    1,905,137
Deferred income taxes                          1,074,000    1,072,285
                                             ------------ ------------

  Total current assets                        33,683,765   35,206,565
Property and equipment - net                   3,687,907    4,786,495

Intangible assets, net of accumulated
 amortization of $318,332 and $370,800           152,543      504,025
  at 2004 and 2005, respectively
                                             ------------ ------------

  Total assets                               $37,524,215  $40,497,085
                                             ============ ============

Liabilities and Stockholders' Equity
Current liabilities
Current portion of notes payable                $125,000           $-
Current portion of capitalized leases             37,370       37,041
Accounts payable                               2,243,955    1,912,645
Accrued expenses and other liabilities         2,433,371    2,584,164
Income taxes payable                             443,619       12,780
                                             ------------ ------------

  Total current liabilities                    5,283,315    4,546,630

Notes payable, less current portion              166,667            -
Capitalized leases, less current portion          31,369        3,277
Deferred income taxes                            143,000       40,348
                                             ------------ ------------

  Total liabilities                            5,624,351    4,590,255
Commitments and contingencies
Stockholders' equity
Preferred stock; par value $0.0001; 5,000,000
 authorized                                            -            -
Common stock; par value $0.0001; 100,000,000
 shares authorized; 7,491,218 and 8,031,189
 shares issued and outstanding at 2004 and
 2005, respectively                                  747          801
Additional paid-in capital                    31,655,426   35,927,045
Accumulated other comprehensive income           437,673      113,467
Accumulated deficit                             (193,982)    (134,483)
                                             ------------ ------------

  Total stockholders' equity                  31,899,864   35,906,830
                                             ------------ ------------

  Total liabilities and stockholders' equity $37,524,215  $40,497,085
                                             ============ ============

CONTACT: Orange 21 Inc.
Michael Brower, 760-804-8420 or
Integrated Corporate Relations
Investor Relations
310-395-2215
Andrew Greenebaum, agreenebaum@icrinc.com
Allyson Pooley, apooley@icrinc.com

SOURCE: Orange 21 Inc.