Inter Parfums, Inc. (NASDAQ GS: IPAR) today reported results for the second quarter ended June 30, 2011.

Second Quarter 2011 Compared to Second Quarter 2010:
  • Net sales increased 12.3% to $121.1 million from $107.8 million; at comparable foreign currency exchange rates, net sales rose 4.7% for the period;
  • European-based operations generated sales of $106.5 million, up 15.9% from $91.9 million;
  • Sales by U.S.-based operations were $14.6 million, down 8.2% from $15.9 million;
  • Gross margin was 62% compared to 60%;
  • S, G & A expense as a percentage of sales was 53.0% compared to 49.4%;
  • Operating margins declined to 9.0% of net sales from 10.7% of net sales;
  • Net income attributable to Inter Parfums, Inc. decreased 6.8% to $5.0 million as compared to $5.4 million; and,
  • Basic and diluted earnings per share declined 11.1% to $0.16 from $0.18.

Through the first half of 2011, net sales were $254.4 million or 12.0% ahead of $227.1 million in the first half of 2010. At comparable foreign currency exchange rates, net sales rose approximately 8.0%. Net income attributable to Inter Parfums, Inc. increased 49% to $17.8 million or $0.58 per basic and diluted share from $11.9 million or $0.39 per basic and diluted share.

Russell Greenberg, Executive Vice President & Chief Financial Officer of Inter Parfums pointed out, “Although second quarter net sales by European-based operations were 16% ahead of last year, they fell short of expectations. As we reported last month, certain shipments scheduled for the second quarter were delayed until the third quarter due to the transfer of inventory and certain other unforeseen transitional issues in connection with the June opening of our new 340,000 square foot distribution center outside of Paris. As a result, we did not achieve the leverage of fixed S, G & A expenses in the current second quarter that we would have otherwise achieved. The comparable quarter increase in sales by European-based operations was in great part due to the commencement of prestige product distribution in the U.S. by our subsidiary, Interparfums Luxury Brands, at the start of 2011, as was the improvement in gross margin, offset somewhat by the negative impact of a weaker U.S. dollar.”

Jean Madar, Chairman & Chief Executive Officer noted, “The Jimmy Choo signature fragrance is in widespread distribution and sales continue to exceed our expectations. This month, Burberry Body comes to market in what will be the largest global Burberry fragrance launch in history. The launch will be accompanied by an ad campaign featuring actress and model Rosie Huntington-Whitely, star of Transformers 3: Dark of The Moon, strategically wrapped in the iconic Burberry trenchcoat.”

Discussing developments for U.S.-based operations, Mr. Madar noted, “ Deep, a new Gap fragrance for men, was launched in time for Father’s Day and initial shipments of Caciquebody products to about 130 Lane Bryant stores took place during the second quarter. In general, the second half of the year is typically stronger than the first half due in part to holiday sales of our specialty retail partners. In addition to normal seasonality, the launch of our first new Betsey Johnson scent, Too Too, with initial distribution in the designer’s stores as well as Sephora stores in the U.S., will add to our top line. We also have the launch of a new bebe scent, Gold, coming soon both at namesake stores and in wider distribution internationally.”

Mr. Madar pointed out, “Another favorable event of the summer took place in July when we renewed our exclusive agreement with The Gap, Inc. to develop, produce, manufacture and distribute fragrances for Gap and Banana Republic brand names covering products sold in their stores in the U.S. and Canada and the license agreement for international distribution. These agreements take effect on January 1, 2012 and run through year-end 2014.”

He went on to say, “As we reported, we signed two new licensing agreements in recent weeks. Under the auspices of our U.S.-based operations, we entered into a 10-year agreement plus two five-year renewal options for Anna Sui fragrances effective January 1, 2012. Also on that date, our 12-year license agreement under the Pierre Balmain brand begins, which is under the direction of Inter Parfums SA, our Paris based subsidiary. In both cases, we will take over production and sales of existing fragrances for both brands and we have plans to introduce a new scent for each in 2013.”

Mr. Greenberg noted, “In light of the major launches of the second half of the year, inventory levels have increased considerably since the end of 2010 and the 2011 first quarter. If history repeats itself, inventory levels should be considerably lower at 2011 year-end. In a similar vein, with planned promotional and advertising activities heavily weighted toward the second half of the year, those expenses in both dollars and as a percentage of net sales should be higher in the second half of 2011 than the first half.”

Affirms 2011 Guidance

Mr. Greenberg concluded, “2011 is on track to be our best year ever. We continue to look for sales of approximately $550.0 million, with resulting net income attributable to Inter Parfums, Inc. of approximately $32.5 million or $1.05 per diluted share. Guidance assumes the dollar remains at current levels.”


The Company’s regular quarterly cash dividend of $0.08 per share will be payable on October 14, 2011 to shareholders of record on September 30, 2011.

Conference Call

Management will conduct a conference call to discuss financial results and business developments at 11:00 AM EDT on Wednesday, August 10, 2011. 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 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.

Inter Parfums, Inc. develops, manufactures and distributes prestige perfumes and cosmetics as the exclusive worldwide licensee for Burberry, Van Cleef & Arpels, Jimmy Choo, Paul Smith, Montblanc, S.T. Dupont and Boucheron. Inter Parfums, Inc. also owns Lanvin Perfumes and Nickel, a men's skin care company. It also produces personal care products for specialty retailers under exclusive agreements for Gap, Banana Republic, Brooks Brothers, bebe, Betsey Johnson, Nine West and Lane Bryant brands. In addition, Inter Parfums produces and supplies mass market fragrances and fragrance related products. Inter Parfums, Inc.'s products are sold 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, 2010 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.

See Accompanying Tables


(In thousands except per share data)

Three Months EndedJune 30, Six Months EndedJune 30,
2011   2010 2011   2010
Net sales $ 121,063 $ 107,765 $ 254,426 $ 227,138
Cost of sales   46,077     43,041     92,850     90,693  
Gross margin 74,986 64,724 161,576 136,445
Selling, general and administrative expenses   64,139     53,240     125,188     108,938  
Income from operations   10,847     11,484     36,388     27,507  
Other expenses (income):
Interest expense 390 510 830 1,098
(Gain) loss on foreign currency 567 514 148 2,896
Interest income   (389 )   (341 )   (706 )   (595 )
  568     683     272     3,399  
Income before income taxes 10,279 10,801 36,116 24,108
Income taxes   3,851     3,818     12,348     8,175  
Net income 6,428 6,983 23,768 15,933

Less: Net income attributable to the      noncontrolling interest





Net income attributable to      Inter Parfums, Inc.








Earnings per share:

Net income attributable to Inter Parfums,      Inc. common shareholders:
Basic $ 0.16 $ 0.18 $ 0.58 $ 0.39
Diluted $ 0.16   $ 0.18   $ 0.58   $ 0.39  

Weighted average number of shares    outstanding:
Basic 30,506 30,361 30,490 30,277
Diluted   30,695     30,467     30,664     30,379  
Dividends declared per share $ 0.08   $ 0.065   $ 0.16   $ 0.13  


(In thousands except share and per share data)

  June 30,

  December 31,2010
Current assets:
Cash and cash equivalents $ 38,774 $ 37,548
Short-term investments 14,102 49,391
Accounts receivable, net 118,237 97,593
Inventories 176,311 109,840
Receivables, other 2,727 3,688
Other current assets 5,388 4,635
Deferred tax assets   7,224     7,230  
Total current assets 362,763 309,925
Equipment and leasehold improvements, net 14,903 11,207
Goodwill 3,922 3,654
Trademarks, licenses and other intangible assets, net 119,163 111,402
Other assets   2,076     1,917  
Total assets $ 502,827   $ 438,105  
Current liabilities:
Loans payable – banks $ 7,686 $ 5,250
Current portion of long-term debt 9,166 11,090
Accounts payable - trade

Accrued expenses

Income taxes payable 1,685 7,905
Dividends payable   2,443     1,979  
Total current liabilities   153,416     126,331  
Long-term debt, less current portion   1,983     5,039  
Deferred tax liability   6,920     6,789  
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 30,534,081 and 30,445,881 shares at  June 30, 2011 and December 31, 2010, respectively




Additional paid-in capital 50,416 48,887
Retained earnings 218,414 205,453
Accumulated other comprehensive income 31,091 14,757

Treasury stock, at cost, 10,009,492 common shares at June   30, 2011 and December 31, 2010




Total Inter Parfums, Inc. shareholders’ equity 265,801 234,976
Noncontrolling interest   74,707     64,970  
Total equity   340,508     299,946  
Total liabilities and equity $ 502,827   $ 438,105  

Copyright Business Wire 2010

If you liked this article you might like

$1,000 for a Men's Fragrance?

$1,000 for a Men's Fragrance?

Inter Parfums (IPAR) Highlighted As Strong And Under The Radar Stock Of The Day

Inter Parfums (IPAR) Highlighted As Strong And Under The Radar Stock Of The Day

Inter Parfums (IPAR) Showing Signs Of Being Strong And Under The Radar

Inter Parfums (IPAR) Showing Signs Of Being Strong And Under The Radar

3 Personal Product Stocks Not Named Avon to Buy

3 Personal Product Stocks Not Named Avon to Buy

Inter Parfums (IPAR) Is Today's Strong And Under The Radar Stock

Inter Parfums (IPAR) Is Today's Strong And Under The Radar Stock