Mixed financial results for optical giants

Luxottica’s net sales for the six months ended 30 June 2016 totalled euro 4.7 billion (AU$7 b), which was a 1.6% increase at constant exchange rates compared with the previous year but a 0.7% decrease at current exchange rates.Commenting on the results, executive chairman Mr Leonardo Del Vecchio said the company had continued to grow despite the increasingly volatile and uncertain macroeconomic environment, the undergoing simplification of the group’s organisation, the implentation of stricter trade policies and major structural investments . However, he acknowledged that Luxottica’s performance had been affected in the second quarter by adverse weather conditions and a paring down of the company’s distribution network.The Asia-Pacific region’s first half net sales of euro 590 million (AU$870.7 m) decreased both at constant and current exchange rates by 0.8% and 4.2%, respectively.It was said that in Australia, OPSM’s in-store assortment revision had a positive impact on comparable store sales in the first half of the year – a trend that was also experienced by Sunglass Hut – and that both the Ray-Ban and Oakley brands were showing double-digit growth in wholesale.Luxottica’s financial statent said that the increasing economic uncertainty had led the company to assume a more cautious outlook for the second half of the year, with the projected global sales growth expected to be a modest increase of 2-3% at constant exchange rates.EssilorMeanwhile, Essilor reported revenue increases at both a global and local level for the first half ending 30 June 2016.First-half global revenue rose to euro 3.6 billion (AU$5.3 b), an increase of 5.1% as reported, 8.1% at constant exchange rates and 4.1% like-for-like compared with the previous year.Essilor attributed the global increase in revenue in part to the strong performance of its lenses and optical instruments division, which generated euro 3.1 billion (AU$4.6 b) in revenue, a 5% increase like-for-like compared with the previous year.Australia and New Zealand independent eye-care professionals and optical retailers were partially credited with boosting business for this division in the developed economies of the Asia/Pacific/Middle East/Africa region.The entire region reported an 8.7% like-for-like increase in lens and optical instrument revenue to euro 564 million (AU$835.3 m) for the first half.Essilor’s global growth was said to have been held back by a contraction in the company’s sunglasses and readers division and a sluggish performance in North America, primarily due to the decrease in Transitions Optical sales to other lens manufacturers.However, the company’s financial statent said Essilor expected the sunglasses and readers division to show improved performance in the second half, with the company targeting a like-for-like revenue increase of more than 6% by 2018.HoyaHoya reported global revenue of ¥115.2 billion (AU$1.5 b) for the first quarter ended 30 June 2016, down 8.8% year-on-year. Sales in the Asia/Oceania region accounted for 30.8% of this total; the region recorded ¥35.4 billion (AU$460.5 million) in revenue, a 15.5% decrease on the previous corresponding period.Hoya cited a loss on foreign exchange of ¥3.4 billion (AU$44.2 million) compared with a gain on foreign exchange of ¥2 billion (AU$26 million) in the same period last year as the reason for the decline.Although Hoya noted that revenue in its eyeglass lens business in Europe and the US increased during the first quarter, total revenue for its ‘life care’ segment – which includes the eyeglass lens business – was down 4.3% from a year ago to ¥76.4 billion (AU$994 million).Hoya added that while contact lenses and intraocular lenses businesses held firm, endoscope revenues decreased because of the effects of foreign currency fluctuations.Hoya forecast a 10.3% drop in revenue for the first six months ending 30 Septber 2016 to ¥230 billion (AU$3 b).