Inter Parfums suffers end of year sales dip
For the full fiscal year, the producer and distributor of prestige perfumes and cosmetics posted a 15 per cent increase in sales to $446.3m, and said the company was still on track to achieve its turnover estimate of $405m for 2009.
European and US sales slip
In 2008, top-line increases in the first half of the year fell away towards the end as final quarter European sales dropped 14 per cent to $83.4m, while US sales fell by 24 per cent to $17.2m.
The particularly sharp decline in American sales was blamed on the difficult sales comparison with 2007. The end of 2007 saw the rollout of personal care products to Gap and New York & Company making the quarter hard to beat a year later.
Commenting on the results, Inter Parfums CEO Jean Madar said: “Although consumer confidence and spending are under pressure in light of the global economic downturn and tight credit markets, we remain quietly optimistic about the future.”
Chief Financial Officer Russell Greenberg said the company had experienced a slowdown in orders as sales drop at distributors and retailers.
Low expectations for the upcoming quarter
In the immediate future the company is not expecting a dramatic turnaround. In a statement, Inter Parfums said it expects a sales contraction in the first quarter of 2009.
The company said comparison with 2008 will be hard after the successful launch of Burberry ‘The Beat’ for women in the first quarter of last year. Changes in exchange rates are also expected to be unfavourable.
Last week, fellow manufacturer of prestige beauty products, Elizabeth Arden also announced a significant decline in sales in preliminary data for the second quarter. The company said sales fell by 12.5 - 13.5 per cent for the three months ending December 31, 2008.
Declining consumer confidence has hit department stores and travel retailers, and because Elizabeth Arden achieves much of its turnover through these channels, its figures suffered over the holiday season.