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RAPAPORT... Blue Nile Inc.'s revenue rose 7.2 percent year on year to $145.96 million in the fourth quarter that ended on December 29. The company's cost of sales increased 7.5 percent to $118.74 million, while its profit was flat at $4.93 million or 38 cents per share, during the quarter. Gross profit as a percent of net sales fell slightly to 18.6 percent compared with 18.8 percent one year earlier. For the full year, the online diamond and jewelry retailer reported that sales rose 12.5 percent year on year to $450 million, while its cost of sales increased 12.7 percent to $366.4 million. Profit rose 29.6 percent to $10.9 million or 87 cents per share. However, net income for the fiscal year included an income tax benefit of $1.1 million or 8 cents per share, from certain discrete tax items filed for the third quarter of 2013.  U.S. engagement-related sales in the fourth quarter, which included Christmastime, improved 6.9 percent year on year $78.7 million, but this rate of growth was lower than the fiscal year increase of 12.9 percent to $255.8 million. Jewelry category sales during the fourth quarter improved 8 percent to $45.9 million and this category's rate of growth for the full year was up 8.9 percent to $121.0 million. Blue Nile's international sales improved 6.8 percent year on year to $21.4 million in the fourth quarter; however, the company recorded a 4.1 percent negative impact from foreign-exchange movement. On a constant-exchange-rate basis, revenue improved by 10.9 percent. The rate of growth for Blue Nile's international operations in 2013 was 17.3 percent to $73.2 million, while removing the impact of currency movement, growth was up 20.2 percent. Net cash provided by operating activities totaled $23.4 million for the fiscal year, down from $34.4 million in 2012. "Looking back at 2013, we are pleased with the continued momentum in the business and confident in our strategy to build long-term growth. We launched important initiatives that drove sales and improved the consumer experience. This year, we will continue to enhance the experience across all platforms, expand exclusive product offers, elevate levels of customer service and increase our global reach. In 2012, we set a three-year goal to re-energize the business. Our performance over the past 20 months gives us confidence that exciting times are yet ahead for Blue Nile as we continue to reframe the business," said Harvey Kanter, Blue Nile's CEO. In other news, Blue Nile announced that its president of international sales and general manager, Vijay Talwar, is no longer with the company.
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