Inter Parfums' sales rocket despite downturn
downturn and reported a boom in first quarter sales.
The company posted an increase of 45 percent in sales to $123.2m for the quarter suggesting consumers do indeed splurge on inexpensive luxury items when the economy wobbles. Lipstick factor The theory is called the lipstick factor and is based on economic data showing that sales of lipstick tend to increase when the economy hits the rocks. Inter Parfums' sales figures were also boosted by the weakness of the dollar against the Euro as most of the company's sales are made on European soil. Currency impact Sales on the continent rose 46 percent to $110.6m in local currency terms whereas at fixed exchange rates the increase was 33 percent. Even once the impact of the weak dollar is accounted for, the increase in turnover is still substantial. Inter Parfums' CEO Jean Madar said much of the gain was due to strong Burberry fragrance sales and in particular the successful launch of Burberry The Beat. Expectations Madar had told investors at the Cowen & Company Consumer Conference in January that he expected growth to be high despite the gloomy economic backdrop. However the figures look to have beaten even his expectations as the company is now reviewing its growth forecasts for the year and will release the updated guidance with its full financial results on May 7.