Obagi Medical Products Inc. said its net income rose 15 percent in the second quarter on higher U.S. sales of its skin-care treatments, slightly exceeding Wall Street expectations. But the company cut its expectations for the fiscal year.
The Long Beach-based company on Monday said it earned $4.5 million, or 20 cents per share in the quarter ended June 30, compared to $3.9 million (18 cents) a year ago.
Revenue rose 7 percent to $27.8 million. Analysts surveyed by Thomson Financial had expected profit of 19 cents per share on revenue of $27.2 million. International sales grew 7 percent as the company added new distributors in the United Kingdom and Russia.
"In spite of the impact economic conditions are having on consumer spending, our domestic business continued to demonstrate both stability and growth across all our product lines," said Chief Executive Steve Carlson in a statement.
The company said that sales were lead by its flagship Nu-Derm creams that repair skin damage. Both the company and investors had been concerned that U.S. sales would slow as consumers cut back spending during the economic slump. While its high-end products are available only through physicians, they aren't covered by insurance.
The company did not give a full-year profit outlook, but its guidance for the third and fourth quarters implies fiscal 2008 net income of 72 cents and 77 cents per share. Obagi previously said it expected full-year profit between 94 cents and 98 cents. The stock price has been down 48 percent so far this year. The company's board of directors on Aug. 5 approved a stock repurchase plan of up to $10 million.
Obagi were up 25 cents, or 3 percent, to $9.75 in Monday mid-morning trading on the Nasdaq.
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