Fragrance player Inter Parfums saw its net sales drop for the third quarter ended September 30, 2012, despite results in the US making up for losses from its European operations.
For the quarter the company’s net sales decreased 3.2 percent to $166.3 million from $171.7 million the year before.
There was joy in the US its sales in this region were $17.7 million, up 4 percent from $17.0 million; but this just made up for the European-based operations which generated sales of $148.6 million, down 4 percent from last year.
Exchange rate effects
The reason behind these figures, according to Inter Parfums, is that the strength of the US dollar had a great effect on domestic sales, but was not so favorable in Europe, where some brands made growth but were affected by the exchange rate.
“In local currency, several key brands within our European-based operations achieved strong growth in the third quarter,” says Jean Madar, chairman & CEO.
The brands that took the currency hits were Montblanc, Jimmy Choo and Lanvin, who all saw sales increases of 67, 44 and 12 percent respectively in local currency.
Last year’s third quarter net sales also included the global launch of Burberry Body, which Madar says made for a difficult year-over-year sales comparison.
In the US, third quarter sales were favorably impacted by the inclusion of Anna Sui fragrance sales, international distribution of US specialty retail brands, and fragrance launches for namesake stores earlier in the year.
Through the first nine months of 2012, net sales were $477.2 million; a 12.0 percent increase on the same period of 2011.
“Our expectations for the coming year will factor in our previously announced transition agreement with Burberry , a process slated for completion by March 31, 2013,” continues Madar.
“[As well as other new fragrance launches] we are enthusiastic about the business opportunity resulting from our new relationship with the iconic Karl Lagerfeld brand , under the 20-year license agreement we entered into last month. The first new fragrance launch from the brand is scheduled for 2014.”