FOR IMMEDIATE RELEASE

 

INTER PARFUMS, INC. REPORTS RECORD 2012 FIRST QUARTER RESULTS

DILUTED EPS UP 24% TO $0.51

 

New York, New York, May 9, 2012: Inter Parfums, Inc. (NASDAQ GS: IPAR) today reported record results for the first quarter ended March 31, 2012.

 

First Quarter 2012 Compared to First Quarter 2011:

·   Net sales increased 24% to $165.4 million from $133.4 million; at comparable foreign currency exchange rates, net sales rose 26% for the period;

·   European-based operations generated sales of $145.2 million, up 19% from $121.6 million;

·   Sales by U.S.-based operations were up 71% to $20.2 million from $11.8 million;

·   Gross margin was 64.5% compared to 64.9%;

·   S, G & A expense as a percentage of sales was 45.3% compared to 45.8%;

·   Operating margins were 19.2% for both periods;

·   Net income attributable to Inter Parfums, Inc. increased 21.5% to $15.5 million as compared to $12.8 million; and,

·   Diluted earnings per share increased 24% to $0.51 from $0.41.

 

Discussing European-based operations in local currency, Jean Madar, Chairman & CEO of Inter Parfums reiterated, “Burberry brand sales were up 12% with our new Burberry Body line plus the brand’s more established collections contributing to the top line growth.  Lanvin fragrance sales also increased 12% reflecting gains by the Eclat d’Arpege line, the staying power of Jeanne Lanvin and Marry Me! and the February limited distribution launch of a new men’s scent, Avant Garde.  As we reported last month, Jimmy Choo and Montblanc brand sales rose 68% and 77%, respectively over last year’s first quarter spurred by 2011 product introductions.  Sales of Boucheron brand products, which were not meaningful in the first half of 2011, also factored into the comparable quarter growth.”

 

He continued, “Later this month we will launch Jaïpur Bracelet, which pays tribute to the Boucheron brand’s jewelry heritage, and relaunch a Balmain heritage scent, Ivoire.  We also have Montblanc Legend for women and a Lanvin brand extension called Jeanne Lanvin Couture debuting later this year.”

 

Mr. Madar once again reported, “Discussions are being actively pursued with Burberry on the creation of a new operating structure for the Burberry fragrance and beauty business.”

 

With regard to U.S.-based operations, Mr. Madar noted, “The 71% increase in sales was due to several factors, including new product launches such as Love Fury by Nine West, Wildbloom Vert for Banana Republic and Gap Established 1969.  The inclusion of Anna Sui fragrance sales effective January 1st was also an important contributor as were further gains by our U.S. specialty retail and designer fragrance brands in overseas markets.  We have an ambitious new product line up in the works, which includes Wishes & Dreams for bebe, Miss Madison for Brooks Brothers, Wildbloom Blue for Banana Republic, and two flankers: Too Too Pretty for Betsey Johnson and Fairy Dance Secret Wish for Anna Sui.”

 

Russell Greenberg, Executive Vice President & Chief Financial Officer, pointed out several items pertinent to the first quarter, “Now that more than a year has passed since taking over prestige product distribution in the U.S. by Interparfums Luxury Brands, Inc., gross margins for reporting periods in 2012 should be more comparable.  In the current first quarter, gains in gross margin from currency fluctuations were offset by changes in product mix.  While we significantly increased our overall advertising budget for all brands to maintain the positive sales momentum and continue to grow our market share, S, G & A expense as a percent of net sales was comparable to last year’s first quarter.”


Also of note, the current first quarter:

 

Affirms 2012 Guidance

Mr. Greenberg concluded, “We recognize that our first quarter performance was well above analysts’ expectations, however, such results were in line with management’s internal expectations.  We intend to provide a guidance update when we announce a resolution regarding our Burberry license.  Therefore 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.”

 

Dividend

The Company’s regular quarterly cash dividend of $0.08 per share will be payable on July 13, 2012 to shareholders of record on June 29, 2012.

 

Conference Call

Management will conduct a conference call to discuss financial results and business developments at 11:00 am ET on Thursday, May 10, 2012.  Interested parties may participate in the call by dialing 201 493-6739; 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 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.

 

Contact at Inter Parfums, Inc.                -or-       Investor Relations Counsel

Russell Greenberg, Exec. VP & CFO                 The Equity Group Inc.

(212) 983-2640                                                  Linda Latman (212) 836-9609/llatman@equityny.com

rgreenberg@interparfumsinc.com                       Lena Cati  (212) 836-9611/lcati@equityny.com

www.interparfumsinc.com                                 www.theequitygroup.com

 

See Accompanying Tables


CONSOLIDATED STATEMENTS OF INCOME

(In thousands except per share data)

 

 

 

Three months ended
March 31,

 

 

2012

 

2011

 

 

 

 

 

 

 

 

 

 

Net sales

 

$                 165,368

 

$                 133,363

 

 

 

 

 

Cost of sales

 

                     58,690

 

                     46,772

 

 

 

 

 

Gross margin

 

                   106,678

 

                     86,591

 

 

 

 

 

Selling, general and administrative expenses

 

                     74,924

 

                     61,049

 

 

 

 

 

Income from operations

 

                     31,754

 

                     25,542

 

 

 

 

 

Other expenses (income):

 

 

 

 

        Interest expense

 

                          362

 

                          440

        (Gain) loss on foreign currency

 

                          248

 

                         (419)

        Interest income

 

                         (524)

 

                         (317)

 

 

 

 

 

 

 

                            86

 

                         (296)

 

 

 

 

 

Income before income taxes

 

                     31,668

 

                     25,838

 

 

 

 

 

Income taxes

 

                     11,414

 

                       8,498

 

 

 

 

 

Net income

 

                     20,254

 

                     17,340

 

 

 

 

 

Less: Net income attributable to the noncontrolling interest

 

                       4,757

 

                       4,581

 

 

 

 

 

Net income attributable to Inter Parfums, Inc.

 

$                   15,497

 

$                   12,759

 

 

 

 

 

Earnings per share:

 

 

 

 

Net income attributable to Inter Parfums, Inc. common shareholders:

 

 

 

 

            Basic

 

                 $0.51

 

                 $0. 42

            Diluted

 

                 $0.51

 

                 $0. 41

 

 

 

 

 

Weighted average number of shares outstanding:

 

 

 

 

            Basic

 

                     30,551

 

                     30,474

            Diluted

 

                     30,686

 

                     30,634

 

 

 

 

 

 

 

 

 

 

Dividends declared per share

 

                 $0.08

 

                 $0. 08

 

 

 

 

 

 

 CONSOLIDATED BALANCE SHEETS

(In thousands except share and per share data)

(Unaudited)

 

 

ASSETS

 

 

March 31,

2012

 

December 31,
2011

Current assets:

 

 

 

 

        Cash and cash equivalents

 

$                   27,410

 

$                   35,856

        Accounts receivable, net

 

                   164,030

 

                   175,223

        Inventories

 

                   183,932

 

                   164,077

        Receivables, other

 

                       2,009

 

                       3,258

        Other current assets

 

                       5,807

 

                       4,258

        Income taxes receivable

 

                            56

 

                       1,404

        Deferred tax assets

 

                       7,338

 

                       7,270

 

 

 

 

 

                            Total current assets

 

                   390,582

 

                   391,346

 

 

 

 

 

Equipment and leasehold improvements, net

 

                     17,002

 

                     14,525

 

 

 

 

 

Trademarks, licenses and other intangible assets, net

 

                   109,585

 

                   105,750

 

 

 

 

 

Goodwill

 

                       2,847

 

                       2,763

 

 

 

 

 

Other assets

 

                       2,161

 

                       1,650

 

 

 

 

 

Total assets

 

$                 522,177

 

$                 516,034

 

 

LIABILITIES AND EQUITY

Current liabilities:

 

 

 

 

        Loans payable – banks

 

$                   13,599

 

$                   11,826

        Current portion of long-term debt

 

                       3,148

 

                       4,480

        Accounts payable - trade

 

                     96,936

 

                   112,726

        Accrued expenses

 

                     43,265

 

                     52,042

        Income taxes payable

 

                       4,255

 

                       2,099

        Dividends payable

 

                       2,444

 

                       2,443

 

 

 

 

 

                            Total current liabilities

 

                   163,647

 

                   185,616

 

 

 

 

 

Deferred tax liability

 

                       6,169

 

                       6,068

 

 

 

 

 

Equity:

 

 

 

 

Inter Parfums, Inc. shareholders’ equity:

 

 

 

 

Preferred stock, $.001 par; authorized
1,000,000 shares; none issued

 

 

 

 

Common stock, $.001 par; authorized 100,000,000 shares;
outstanding 30,561,616 and 30,541,506 shares at

March 31, 2012 and December 31, 2011, respectively

 

 

 

                            31

 

 

 

                            31

Additional paid-in capital

 

                     51,264

 

                     50,883

Retained earnings

 

                   241,259

 

                   228,164

Accumulated other comprehensive income

 

                     14,938

 

                       7,747

Treasury stock, at cost, 10,009,492 common shares at March 31, 2012 and December 31, 2011

 

 

                   (34,151)

 

 

                   (34,151)

 

 

 

 

 

                    Total Inter Parfums, Inc. shareholders’ equity

 

                   273,341

 

                   252,674

 

 

 

 

 

Noncontrolling interest

 

                     79,020

 

                     71,676

 

 

 

 

 

                            Total equity

 

                   352,361

 

                   324,350

 

 

 

 

 

Total liabilities and equity

 

$                 522,177

 

$                 516,034