Inter Parfums, Inc. reported results for the third quarter ended September 30, 2013. For the third quarter 2013 compared to third quarter 2012, net sales of ongoing brands (excluding Burberry brand sales) increased 45% to $126.8 million from $87.2 million; net sales including Burberry brand sales were down 23.8% to $126.8 million, compared to $166.3 million; at comparable foreign currency exchange rates, net sales declined 23.9%; European-based operations generated sales of ongoing brands of $98.1 million, up 41.2% from $69.5 million; including Burberry brand sales, European-based sales were down 34%; and sales by U.S.-based operations were $28.7 million, up 62.3% from $17.7 million.
Regarding European-based operations, Jean Madar, chairman CEO of Inter Parfums, commented, “Our ongoing brands, especially our three largest—Montblanc, Jimmy Choo and Lanvin—produced another quarter of very strong growth. Montblanc Legend fragrances lead Montblanc to a 57% increase in brand sales, while FlashEclat d’Arpège, sustained demand of Jeanne Lanvin, and the successful spring launch of Lanvin Me. Adding to the impressive growth of our European business were the recent launches of the Repetto signature scent, as well as Place Vendôme from Boucheron, both of which exceeded our expectations and were meaningful contributors to our performance during the third quarter.”
Discussing U.S.-based operations, Madar noted, “As we reported last month, Anna Sui sales were boosted by the rollout of La Vie de Bohème this past summer and continuing brand sales which were especially strong in Asia. Sales of Alfred Dunhill legacy fragrances, which commenced in April 2013, as well as initial sales of Agent Provocateur legacy scents beginning in August also contributed to comparable quarter sales growth. In addition, we brought new fragrances for our specialty retail brands to market: Banana Republic’s Wildbloom Rouge and Wildblue Noir and bebe Nouveau.”
Madar continued, “Our new product pipeline for 2014 points to one of our most ambitious launch years ever, with new scents in the works for Oscar de la Renta, Alfred Dunhill, Agent Provocateur, Karl Lagerfeld and Shanghai Tang; all of these new licensed brands were added over the past 13 months. We are also unveiling new fragrances for the Montblanc, Balmain, S.T. Dupont, Banana Republic and Brooks Brothers brands. Add to this our expansion initiatives in Asia, a full year of sales of legacy scents for Oscar de la Renta, Agent Provocateur and Alfred Dunhill, our continued search for additional brands, and our very strong balance sheet, and our future looks promising.”
Regarding the company’s financial outlook for 2013, Russell Greenberg, executive vice president and CFO, commented, “In September when we last raised guidance to approximately $540 million in net sales, and $1.18 per diluted share in net income attributable to Inter Parfums, Inc., we also noted that during the fourth quarter, we would be making significant investments in advertising and promotion to support the new product launches for Repetto and Boucheron, and the continued worldwide development of the Lanvin, Jimmy Choo and Montblanc brands. With that said, our results year-to-date have been quite a bit better than we had anticipated. As a result, we are raising our 2013 guidance for net sales to approximately $560 million and net income attributable to Inter Parfums, Inc. to approximately $1.23 per diluted share.”
Greenberg concluded, “We are also updating the preliminary 2014 guidance that we gave in September to reflect our recently signed agreement with Oscar de la Renta, and the greater visibility that we have gained during the last two months. We now expect net sales of approximately $495 million, which represents 15% growth in sales of our ongoing brands. Our revised expectations for net income attributable to Inter Parfums, Inc. are in the range of $0.93–0.98 per diluted share. Our previous forecast for 2014 net sales was $475 million resulting in net income attributable to Inter Parfums, Inc. of $0.90–0.95 per diluted share.” Guidance for both 2013 and 2014 assumes the dollar remains at current levels.