LensCrafters 2013 Annual Report Download - page 15

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attributable to the increased sales in the manufacturing and wholesale distribution segment in the three months ended
December 31, 2013 as compared to the same period in 2012 offset by a decrease in sales in the retail distribution segment of
Euro 19.3 million for the same period.
Net sales for the retail distribution segment decreased by Euro 19.3 million, or 1.9 percent, to Euro 1,001.7 million
in the three months ended December 31, 2013 from Euro 1,021.0 million in the same period in 2012. Comparable store
sales
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improved by 3.0 percent. In particular, there was a 1.7 percent increase in comparable store sales for the North
American retail operations, and an increase for the Australian/New Zealand retail operations of 2.0 percent. The effects from
currency fluctuations between the Euro (which is our reporting currency) and other currencies in which we conduct business,
in particular the weakening of the U.S. dollar and Australian dollar compared to the Euro, decreased net sales in the retail
distribution segment by Euro 71.8 million during the period.
Net sales to third parties in the manufacturing and wholesale distribution segment increased by Euro 32.9 million, or
5.4 percent, to Euro 644.2 million in the three months ended December 31, 2013 from Euro 611.3 million in the same period
in 2012. This growth was mainly attributable to increased sales of most of our proprietary brands, in particular Ray-Ban, and
of some licensed brands such as Chanel, Tiffany, Tory Burch and the new Armani brands, which were launched in 2013.
Almost all of the primary geographic markets in which the Group operates recorded an increase in net sales. These positive
effects were partially offset by negative currency fluctuations, in particular the weakening of the U.S. Dollar and other
currencies including but not limited to the Brazilian Reais and the Turkish Lira, the effect of which was to decrease net sales
to third parties in the manufacturing and wholesale distribution segment by Euro 38.2 million.
In the three months ended December 31, 2013, net sales in the retail distribution segment accounted for
approximately 60.9 percent of total net sales, as compared to approximately 62.5 percent of total net sales for the same period
in 2012.
In the three months ended December 31, 2013, net sales in our retail distribution segment in the United States and
Canada comprised 75.8 percent of our total net sales in this segment as compared to 76.1 percent of our total net sales in the
same period of 2012. In U.S. dollars, retail net sales in the United States and Canada increased by 2.8 percent to
USD 1,036.6 million in the three months ended December 31, 2013 from USD 1,008.0 million for the same period in 2012.
During the three months ended December 31, 2013, net sales in the retail distribution segment in the rest of the world
(excluding the United States and Canada) comprised 24.2 percent of our total net sales in the retail distribution segment and
decreased by 0.8 percent to Euro 242.6 million in the three months ended December 31, 2013 from Euro 244.5 million, or
23.9 percent of our total net sales in the retail distribution segment for the same period in 2012.
In the three months ended December 31, 2013, net sales to third parties in our manufacturing and wholesale
distribution segment in Europe increased by Euro 11.6 million, or 4.7 percent, to Euro 259.6 million, comprising 40.3 percent
of our total net sales in this segment, compared to Euro 248.0 million or 40.6 percent of total net sales in the segment, for the
same period in 2012. Net sales to third parties in our manufacturing and wholesale distribution segment in the United States
and Canada were USD 202.9 million and comprised 22.9 percent of our total net sales in this segment for the three months
ended December 31, 2013, compared to USD 192.2 million, or 24.2 percent of total net sales in the segment, for the same
period of 2012. In the three months ended December 31, 2013, net sales to third parties in our manufacturing and wholesale
distribution segment in the rest of the world increased by Euro 21.3 million, or 9.9 percent, in the three months ended
December 31, 2013 as compared to the same period of 2012, to Euro 236.8 million, comprising 36.8 percent of our total net
sales in this segment, compared to Euro 215.5 million, or 35.3 percent of our net sales in this segment, in the same period
of 2012. This increase is due to the general growth in demand, in particular in emerging markets.
Cost of Sales. Cost of sales increased by Euro 23.4 million, or 4.1 percent, to Euro 590.5 million in the three
months ended December 31, 2013 from Euro 567.1 million in the same period of 2012. As a percentage of net sales, cost of
sales increased to 35.9 percent in the three months ended December 31, 2013 as compared to 34.7 percent in the same period
of 2012. In the three months ended December 31, 2013, the average number of frames produced daily in our facilities
decreased to approximately 291,900 as compared to approximately 294,500 in the same period of 2012.
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Comparable store sales reflects the change in sales from one period to another that, for comparison purposes, includes in the calculation only stores
open in the more recent period that also were open during the comparable prior period in the same geographic area, and applies to both periods the
average exchange rate for the prior period.