Inter Parfums, Inc. (NASDAQ GS: IPAR) today reported results for
the fourth quarter and year ended December 31, 2011.
Fourth Quarter 2011 Compared to Fourth Quarter 2010:
- Net sales rose to $189.1 million, a 68%
increase from $112.5 million; at comparable foreign currency
exchange rates, net sales rose 61% for the period;
- European-based operations generated net
sales of $169.6 million, up 78% from $95.5 million;
- Net sales by U.S.-based operations were
up nearly 15% to $19.5 million from $17.0 million;
- Gross margin was 61.7% compared to
59.0%;
- S, G & A expense as a percentage of
sales was 56.5% compared to 48.0%;
- Operating margins were 4.8% of net
sales compared to 11.0% of net sales;
- Net income attributable to Inter
Parfums, Inc. was $4.1 million as compared to $6.2 million;
and,
- Basic and diluted earnings per share
were $0.13 compared to $0.20.
Thus, net sales for the year ended December 31, 2011 increased
34% to a record $615.2 million from the prior year’s $460.4
million; in constant dollars 2011 net sales rose 28%. Net income
attributable to Inter Parfums, Inc. rose 21% to a record $32.3
million or $1.05 per diluted share from $26.6 million or $0.87 per
diluted share in 2010.
Jean Madar, Chairman & CEO of Inter Parfums noted, “2011 was
far and away the best year in our history. Not only did we achieve
record sales and profits, but we gained further control over
product distribution, executed the largest new product launch in
our history, enjoyed major success introducing fresh products for
our newest brands, and added three valuable names to our brand
portfolio: Balmain, Repetto and Anna Sui.”
Mr. Madar went on to say, “Several of our prestige portfolio
brands showed stellar sales gains. Notably Burberry sales rose 20%
for the year in local currency due to the launch of Burberry Body
and the staying power of the brand’s historic lines. With the debut
of Montblanc Legend, sales were more than three times greater than
in 2010, when legacy brand sales were limited to the second half
only. In 2011, we recorded first time sales for the Jimmy Choo
signature fragrance which far exceeded expectations; and in the
latter part of the year, sales of Boucheron products began. New
product launches, including Too Too for Betsey Johnson, and the
continued distribution of specialty retail products overseas, were
among the reasons for the increase in sales by U.S.-based
operations.”
On the subject of Burberry, Mr. Madar then added, “Discussions
that began in December between Interparfums SA and Burberry on the
creation of a new operational structure for the fragrance and
beauty business are continuing.”
Russell Greenberg, Executive Vice President and Chief Financial
Officer of Inter Parfums, Inc., noted, “The January 2011
commencement of European-based product distribution in the U.S. by
Interparfums Luxury Brands, Inc., a subsidiary of Interparfums SA,
had a significant influence on our reported results. As we had been
reporting throughout 2011, this change in our U.S. distribution
model factored into the increases in net sales, gross margin and S,
G & A as a percent of sales for the each of the four quarters
and for the year as a whole.”
Mr. Greenberg pointed out, “While my focus is on the year as a
whole, the dramatic increase in fourth quarter sales and concurrent
decline in fourth quarter profits and margins requires explanation.
Promotion and advertising expenses included in S, G & A
expenses for the three months ended December 31, 2011 increased to
$49.8 million and represented 26.3% of net sales as compared to
$10.9 million or 9.7% of net sales in same period of 2010. Much of
that increase is because we are now responsible for 100% of the
cost of advertising support for our European-based fragrance brands
distributed in the U.S.; in previous years, those costs were shared
with our former U.S. distributor. In addition, the global launch of
Burberry Body was supported with a strong visual campaign on a
scale far greater than ever before. Further, our advertising spend
for certain other strong sellers like Jimmy Choo and Montblanc also
pushed our advertising and promotion budget to new heights.”
He went on to say, “For the year as a whole, promotion and
advertising included in S, G & A expenses aggregated $127.8
million or 20.8% of net sales compared to $69.2 million or 15.0% of
net sales in 2010.”
Mr. Greenberg also pointed out that net income attributable to
Inter Parfums:
- Was reduced by an impairment loss of
$0.8 million in 2011 relating to the goodwill of the Nickel
business;
- Benefited from $1.5 million of foreign
currency gains compared to $2.1 million of foreign currency losses
in 2010; and,
- Reflects a 36.3% effective tax rate
compared to 33.7% in 2010.
Discussing plans for European-based operations, Mr. Madar
stated, “Following 2011’s very ambitious product launch schedule,
in 2012 we will primarily grow our business through ongoing
advertising and promotion of our strongest brands and fragrances in
our prestige portfolio. We are however bringing several new
fragrances to market, including our first new woman’s scent for
Montblanc, and a new take on established Boucheron and Balmain
scents.”
On the subject of U.S.-based operations, Mr. Madar stated, “We
have quite a few new products debuting this year. Love Fury by Nine
West was launched at 650 Macy’s and 282 Nine West stores in the
U.S. and internationally. Banana Republic’s Wildbloom Vert, an
offshoot of 2011’s Wildbloom, is now in U.S. namesake stores with a
men’s version in the works. Gap Established 1969, a new fragrance
for Gap with versions for men and women, is currently hitting store
shelves, and also scheduled for a 2012 introduction are Fairy
Dance, our first new fragrance for Anna Sui and Wishes & Dreams
for bebe.”
Affirms 2012 Guidance
Mr. Greenberg concluded, “While we are regularly reviewing our
expectations for 2012, at this point in time, we are reaffirming
our current guidance which calls for sales of approximately $625.0
million, with resulting net income attributable to Inter Parfums,
Inc. of approximately $35.7 million or $1.16 per diluted share. The
three major launches of 2011 versus a more modest launch schedule
in 2012 set a very high bar for year-over-year comparisons of our
financial results. Guidance assumes the dollar remains at current
levels.”
Quarterly Dividend
The Company’s regular quarterly cash dividend of $0.08 per share
is payable on April 16, 2012 to shareholders of record on March 30,
2012.
Conference Call
Management will conduct a conference call to discuss financial
results and business developments at 11:00 am ET on Tuesday, March
13, 2012. Interested parties may participate in the call by dialing
201 493-6744; please call in 10 minutes before the conference call
is scheduled to begin and ask for the Inter Parfums call. The
conference call will also be broadcast live over the Internet. To
listen to the live call, please go to www.interparfumsinc.com and
click on the Investor Relations section. Please go to the website
at least 15 minutes early to register, and download and install any
necessary audio software. If you are unable to listen live, the
conference call will be archived and can be accessed for
approximately 90 days at Inter Parfums’ website. We suggest
listeners use Microsoft Explorer as their browser.
In the nearly 30 years since its founding, Inter Parfums, Inc.
has been selected as the fragrance and beauty partner for a growing
list of prestige brands that include Burberry, Lanvin, Jimmy Choo,
Van Cleef & Arpels, Montblanc, Paul Smith, Boucheron, S.T.
Dupont, Balmain and Repetto. Inter Parfums is also the fragrance
and beauty partner for specialty retail and designer brands such as
Gap, Banana Republic, Brooks Brothers, bebe, Betsey Johnson, Nine
West, Lane Bryant and Anna Sui. Inter Parfums is known for
innovation, quality and its ability to capture the genetic code of
each brand in the products it develops, manufactures and
distributes in over 120 countries worldwide.
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 Inter Parfums' annual
report on Form 10-K for the fiscal year ended December 31, 2011 and
the reports Inter Parfums files from time to time with the
Securities and Exchange Commission. Inter Parfums does not intend
to and undertakes no duty to update the information contained in
this press release.
CONSOLIDATED STATEMENTS OF
INCOME
(In thousands except per share data)
Three Months EndedDecember 31, Year
EndedDecember 31, 2011 2010 2011 2010
Net
sales $ 189,088 $ 112,420 $ 615,220 $ 460,411
Cost of
sales 72,473
46,130 228,446 186,401
Gross margin 116,615 66,290 386,774 274,010
Selling, general and administrative expenses 106,772 53,944
318,998 217,574
Impairment of goodwill 837
-- 837 --
Income from operations 9,006 12,346
66,939 56,436
Other
expenses (income): Interest expense 681 489 2,197 2,116 (Gain)
loss on foreign currency (456 ) (303 ) (1,546 ) 2,132 Interest
income (158 ) (675 ) (1,105 ) (1,652 )
67 (489 ) (454 ) 2,596
Income before income taxes 8,939 12,835 67,393
53,840 Income taxes 3,042 4,502
24,444 18,165
Net income
5,897 8,333 42,949 35,675 Less: Net income attributable to
the noncontrolling interest
1,779
2,094
10,646
9,082
Net income attributable to Inter
Parfums, Inc.
$
4,118
$
6,239
32,303
$
26,593
Earnings per share: Net
income attributable to Inter Parfums, Inc. common shareholders:
Basic $ 0.13 $ 0.20 $ 1.06 $ 0.88 Diluted $ 0.13 $ 0.20
$ 1.05 $ 0.87
Weighted average
number of shares outstanding: Basic 30,540 30,446 30,515 30,361
Diluted 30,685 30,605 30,678
30,482
INTER PARFUMS, INC. AND
SUBSIDIARIES Consolidated Balance Sheets December 31, 2011 and
2010 (In thousands except share and per share data)
Assets
2011 2010 Current assets: Cash
and cash equivalents $ 35,856 $ 37,548 Short-term investments --
49,391 Accounts receivable, net 175,223 97,593 Inventories 164,077
109,840 Receivables, other 3,258 3,688 Other current assets 4,258
4,635 Income taxes receivable 1,404 -- Deferred tax assets 7,270
7,230 Total current assets 391,346 309,925 Equipment and leasehold
improvements, net 14,525 11,207 Trademarks, licenses and other
intangible assets, net 105,750 111,402 Goodwill 2,763 3,654 Other
assets 1,650 1,917 Total assets $ 516,034 $ 438,105
Liabilities
and Equity Current liabilities: Loans payable – banks $ 11,826
$ 5,250 Current portion of long-term debt 4,480 11,090 Accounts
payable - trade 112,726 52,694 Accrued expenses 52,042 47,413
Income taxes payable 2,099 7,905 Dividends payable 2,443 1,979
Total current liabilities 185,616 126,331 Deferred tax liability
6,068 6,789 Long-term debt, less current portion -- 5,039
Commitments and contingencies Equity: Inter Parfums, Inc.
shareholders’ equity:
Preferred stock, $0.001 par value.
Authorized 1,000,000 shares; none issued
Common stock, $0.001 par value. Authorized
100,000,000 shares; outstanding, 30,541,506 and 30,445,881 shares
at December 31, 2011 and 2010, respectively
31 30 Additional paid-in capital 50,883 48,887 Retained earnings
228,164 205,453 Accumulated other comprehensive income 7,747 14,757
Treasury stock, at cost, 10,009,492 common
shares at December 31, 2011 and 2010
(34,151) (34,151) Total Inter Parfums, Inc. shareholders’ equity
252,674 234,976 Noncontrolling interest 71,676 64,970 Total equity
324,350 299,946 Total liabilities and equity $ 516,034 $ 438,105
Inter Parfums (NASDAQ:IPAR)
Historical Stock Chart
From Apr 2024 to May 2024
Inter Parfums (NASDAQ:IPAR)
Historical Stock Chart
From May 2023 to May 2024