The Blue Nile online diamond and jewelry retailer has reported net sales of $80.5 million for the second quarter of 2011, a 5.1% increase and a record Q2 figure.

The diamond company's operating income for Q2 totaled $4.3 million, while net income stood at $2.8 million. The quarter ended with a record Q2 cash balance of $74.2 million.

Blue Nile CEO Diane Irvine noted that the company's results had been impacted by "rapidly rising diamond and metal prices amid a weakening consumer environment in the US." Nevertheless, she said, Blue Nile achieved sales growth in all its product categories.

Irvine noted that the Blue Nile's non-engagement jewelry saw double-digit growth for the quarter and that international business was also on the rise, increasing 40.7% to $12.8 million in the second quarter.

For the third quarter, Blue Nile projects net sales of $71.5 - $74 million.

In related news, Mark Vadon is ending his term as Executive Chairman of Blue Nile but will remain in his post as Chairman of the Board of Directors. Vadon said he was "excited about the opportunities that are ahead for Blue Nile."