The Associated Press July 29, 2010, 1:31PM ET

Italy's Bulgari posts modest 2Q profit

The Italian jeweler Bulgari returned to a modest profit in the second quarter as sales of jewelery in all categories except watches picked up, the company said Thursday.

Bulgari reported a second-quarter profit of euro600,000 ($784,140), compared with a loss of euro11.2 million in the same quarter a year ago.

Quarterly revenues were up 12 percent to euro244 million, compared with euro218 million a year earlier.

The Rome-based jeweler recorded first-half losses of euro7.7 million, an improvement over last year's first-half loss of euro40.5 million. Bulgari said its results were hurt by exchange rate fluxuations, particularly the rise of the Swiss franc to the euro, despite a 22 percent increase in revenues to euro34.8 million from euro28.4 million.

CEO Francesco Trapani said the results confirmed the company's focus on creativity and cost-containing. He noted in particular the strong performance in accessories, which grew 20 percent largely due to handbags.

Evolution Securities analyst Dennis Weber, however, said the quarter net profit of euro600,000 was significantly below his estimate of euro6.2 million.

"While all other luxury players have recently surprised the market with strong sales and profit performances," Bulgari disappoints once again and upgrades to consensus estimates are unlikely," Weber said in a note.

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