Inter Parfums, Inc. Reports 2024 First Quarter Results
Results in-line with Expectations; Reaffirms 2024 Sales and Earnings Guidance
First Quarter 2024 Highlights: ($ in millions, except per share amounts) |
Three Months Ended
|
||
2024 |
2023 |
% Change |
|
|
|
|
4% |
Gross Margin |
62.5% |
65.1% |
(260 bps) |
Operating Income |
|
|
(25%) |
Operating Margin |
21.0% |
29.0% |
(800 bps) |
Net Income attributable to IP |
|
|
(24%) |
Diluted EPS |
|
|
(24%) |
Operational Commentary
“We delivered a healthy operating margin of 21% for the quarter, in-line with our expectations. The 29% operating margin in the 2023 first quarter was exceptionally high due to a large pipeline of new product launches combined with low advertising and promotional expenses. This largely explains the 25% decline in operating income and the 24% decline in earnings per diluted share as compared to prior year quarter.
“North America, our largest market, remains robust despite a 3% decline in comparable quarter sales, due primarily to the concentration of launches in early 2023.
“Asia/Pacific grew sales by 13%, led by
He continued, “During the first quarter of 2024, we launched several new fragrances, including extensions within established lines for
“GUESS, our fourth largest brand, achieved the greatest sales gain among our top brands at 21% for the quarter. With a very strong innovation calendar for the remainder of the year, all indicators for the brand are green and point to another exceptional year.
“Once again, we have an ambitious innovation strategy planned for the balance of 2024, including blockbuster fragrances for
“We increased advertising and promotional investments in the first quarter to fuel business growth throughout the year and to compensate for lighter new product launches than in the prior year. Our decision to spend significantly more during the fourth quarter of 2023, combined with higher spending this quarter, is proving to be a winning strategy as it enables us to drive sell-out ahead of sell-in. Additionally, we are continuing to develop compelling content and implement omnichannel concepts with renown fragrance enthusiasts to further expand our reach and exposure in meaningful ways.”
Financial Commentary
Discussing the first quarter
“Gross margin for
He continued, “SG&A rose to 41.5% from 36.1% in the prior year period, largely driven by our investments in advertising and promotion across both our European and
“Our financial position remains strong. We closed the quarter with
Reaffirms 2024 Guidance
Guidance assumes that the average dollar/euro exchange rate remains at current levels.
Dividend
The Company’s regular quarterly cash dividend of
Conference Call
Management will host a conference call to discuss financial results and business operations beginning at
Interested parties may participate in the live call by dialing (877) 423-9820 (toll-free) or (201) 493-6749 (international).
Participants are asked to dial-in approximately 10 minutes before the conference call is scheduled to begin.
A live audio webcast will also be available in the “Events” tab within the Investor Relations section of the Company’s website at www.interparfumsinc.com, or by clicking here. The conference call will be available for webcast replay for approximately 90 days following the live event.
About
Operating in the global fragrance business since 1982,
The portfolio of prestige brands includes Abercrombie & Fitch,
Forward-Looking Statements
Statements in this release which are not historical in nature are forward-looking statements. Although we believe that our plans, intentions, and expectations reflected in such forward-looking statements are reasonable, we can give no assurance that such plans, intentions, or expectations will be achieved. In some cases, you can identify forward-looking statements by forward-looking words such as "anticipate," "believe," "could," "estimate," "expect," "intend," "may," "should," "will," and "would," or similar words. You should not rely on forward-looking statements, because actual events or results may differ materially from those indicated by these forward-looking statements as a result of a number of important factors. These factors include, but are not limited to, the risks and uncertainties discussed under the headings “Forward Looking Statements” and "Risk Factors" in
See Accompanying Tables
CONSOLIDATED BALANCE SHEETS
(In thousands except share and per share data)
(Unaudited)
ASSETS |
||||||||
|
|
2024 |
|
|
||||
Current assets: |
|
|
|
|
||||
Cash and cash equivalents |
|
$ |
20,976 |
|
|
$ |
88,462 |
|
Short-term investments |
|
|
76,078 |
|
|
|
94,304 |
|
Accounts receivable, net |
|
|
293,075 |
|
|
|
247,240 |
|
Inventories |
|
|
400,209 |
|
|
|
371,859 |
|
Receivables, other |
|
|
5,581 |
|
|
|
7,012 |
|
Other current assets |
|
|
34,258 |
|
|
|
29,458 |
|
Income taxes receivable |
|
|
2,490 |
|
|
|
691 |
|
Total current assets |
|
|
832,667 |
|
|
|
839,026 |
|
Property, equipment and leasehold improvements, net |
|
|
164,165 |
|
|
|
169,222 |
|
Right-of-use assets, net |
|
|
26,980 |
|
|
|
28,613 |
|
Trademarks, licenses and other intangible assets, net |
|
|
288,117 |
|
|
|
296,356 |
|
Deferred tax assets |
|
|
15,726 |
|
|
|
14,545 |
|
Other assets |
|
|
21,521 |
|
|
|
21,567 |
|
Total assets |
|
$ |
1,349,176 |
|
|
$ |
1,369,329 |
|
|
||||||||
LIABILITIES AND EQUITY |
||||||||
Current liabilities: |
|
|
|
|
||||
Loans payable - banks |
|
$ |
8,324 |
|
|
$ |
4,420 |
|
Current portion of long-term debt |
|
|
29,027 |
|
|
|
29,587 |
|
Current portion of lease liabilities |
|
|
5,928 |
|
|
|
5,951 |
|
Accounts payable – trade |
|
|
106,219 |
|
|
|
97,409 |
|
Accrued expenses |
|
|
135,660 |
|
|
|
178,880 |
|
Income taxes payable |
|
|
17,300 |
|
|
|
8,498 |
|
Total current liabilities |
|
|
302,458 |
|
|
|
324,745 |
|
|
|
|
|
|
||||
Long–term debt, less current portion |
|
|
115,926 |
|
|
|
127,897 |
|
Lease liabilities, less current portion |
|
|
22,905 |
|
|
|
24,517 |
|
Equity: |
|
|
|
|
||||
|
|
|
|
|
||||
Preferred stock, |
|
|
-- |
|
|
|
-- |
|
Common stock,
|
|
|
32 |
|
|
|
32 |
|
Additional paid-in capital |
|
|
100,309 |
|
|
|
98,565 |
|
Retained earnings |
|
|
711,043 |
|
|
|
693,848 |
|
Accumulated other comprehensive loss |
|
|
(50,417 |
) |
|
|
(40,188 |
) |
|
(52,864 |
) |
(52,864 |
) |
||||
|
|
|
708,103 |
|
|
|
699,393 |
|
Noncontrolling interest |
|
|
199,784 |
|
|
|
192,777 |
|
Total equity |
|
|
907,887 |
|
|
|
892,170 |
|
Total liabilities and equity |
|
$ |
1,349,176 |
|
|
$ |
1,369,329 |
|
CONSOLIDATED STATEMENTS OF INCOME
(In thousands except per share data)
(Unaudited)
|
|
|
Three Months Ended
|
||||||
|
|
|
|
2024 |
|
|
|
2023 |
|
|
|
|
|
|
|
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Net sales |
|
|
$ |
323,963 |
|
|
$ |
311,723 |
|
|
|
|
|
|
|
||||
Cost of sales |
|
|
|
121,578 |
|
|
|
108,766 |
|
|
|
|
|
|
|
||||
Gross margin |
|
|
|
202,385 |
|
|
|
202,957 |
|
|
|
|
|
|
|
||||
Selling, general and administrative expenses |
|
|
|
134,412 |
|
|
|
112,678 |
|
|
|
|
|
|
|
||||
Income from operations |
|
|
|
67,973 |
|
|
|
90,279 |
|
|
|
|
|
|
|
||||
Other expenses (income): |
|
|
|
|
|
||||
Interest expense |
|
|
|
1,807 |
|
|
|
2,357 |
|
(Gain) loss on foreign currency |
|
|
|
(905 |
) |
|
|
759 |
|
Interest and investment income |
|
|
|
(3,020 |
) |
|
|
(5,382 |
) |
Other expense (income) |
|
|
|
38 |
|
|
|
(41 |
) |
|
|
|
|
|
|
||||
|
|
|
|
(2,080 |
) |
|
|
(2,307 |
) |
|
|
|
|
|
|
||||
Income before income taxes |
|
|
|
70,053 |
|
|
|
92,586 |
|
|
|
|
|
|
|
||||
Income taxes |
|
|
|
16,750 |
|
|
|
21,678 |
|
|
|
|
|
|
|
||||
Net income |
|
|
|
53,303 |
|
|
|
70,908 |
|
|
|
|
|
|
|
||||
Less: Net income attributable to the noncontrolling interest |
|
|
|
12,255 |
|
|
|
16,840 |
|
|
|
|
|
|
|
||||
Net income attributable to |
|
|
$ |
41,048 |
|
|
$ |
54,068 |
|
|
|
|
|
|
|
||||
|
|
|
|
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|
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Earnings per share: |
|
|
|
|
|
||||
|
|
|
|
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|
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Net income attributable to |
|
|
|
|
|
||||
Basic |
|
|
$ |
1.28 |
|
|
$ |
1.69 |
|
Diluted |
|
|
$ |
1.27 |
|
|
$ |
1.68 |
|
|
|
|
|
|
|
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Weighted average number of shares outstanding: |
|
|
|
|
|
||||
Basic |
|
|
|
32,041 |
|
|
|
32,018 |
|
Diluted |
|
|
|
32,266 |
|
|
|
32,159 |
|
|
|
|
|
|
|
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|
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Dividends declared per share |
|
|
$ |
0.75 |
|
|
$ |
0.625 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20240507524635/en/
Chief Financial Officer
(212) 983-2640
www.interparfumsinc.com
or
Investor Relations Counsel
(212) 836-9623 / kdaly@equityny.com
www.theequitygroup.com
Source: