For the 2010 fiscal year, gross sales increased 13.7 percent to $1.489 billion from $1.309 billion a year earlier. Net sales for the year ended December 31, 2010 increased 14.1 percent to $1.304 billion from $1.143 billion a year ago.
Gross profit as a percentage of net sales was 52.2 percent for the year ended December 31, 2010, compared with 53.6 percent for the 2009 year.
Operating expenses for the year ended December 31, 2010 increased to $332.4 million from $275.0 million for 2009. Included in operating expenses in the 2009 year was a $4.7 million credit related to reimbursements to the Company of legal expenses previously paid by the Company. Operating income for the 2010 year increased 3.1 percent to $347.8 million from $337.3 million a year ago.
Net income for the twelve-months ended December 31, 2010 was $212.0 million, or $2.28 per diluted share, compared with $208.7 million, or $2.21 per diluted share, for the same period last year.Gross sales to customers outside the United States were $240.6 million in the year ended December 31, 2010, compared with $168.0 million in the year ended December 31, 2009. Auction Rate Securities In March 2010, the Company entered into an agreement relating to $54.2 million in par value auction rate securities, which enables the Company to sell such securities (the "Put Option") in semi-annual or annual installments beginning March 22, 2011 with full sale rights available on or after March 22, 2013. Such auction rate securities, which have been reclassified from available-for-sale to trading securities, will continue to accrue interest until redeemed through either the Put Option, by the auction process, or by the terms outlined in their respective prospectuses in the event of auction failure. At December 31, 2010 the Company held auction rate securities with a face value of $79.6 million. The Company determined that an impairment of $7.4 million had occurred at December 31, 2010, of which $2.4 million was deemed temporary and $5.0 million was deemed other-than-temporary. Included in other comprehensive loss is $1.5 million of accumulated net unrealized loss on available-for-sale securities, net of taxes for the twelve-months ended December 31, 2010. Included in interest and other income, net, is $0.8 million loss on investment and put option for the twelve-months ended December 31, 2010. The auction rate securities will continue to accrue interest at their contractual rates until their respective auctions succeed or they are redeemed.