Inter Parfums gets off to a flyer
Net sales for the first quarter of 2011 were approximately $133.4m (€89.8m), an 11.7 per cent increase from $119.4m in the first quarter of 2010.
European-based sales remain the largest money taker, with sales of $121.6m, up 12.3 per cent on last year, whilst the US saw growth of 6.5 per cent, with sales reaching $11.8m.
"The new year started on a strong note," stated Jean Madar, chairman & CEO of Inter Parfums.
Change in distribution
Discussing European-based operations, he commented, "First quarter sales growth was due to a number of factors, including the January 1, 2011 commencement of prestige product distribution in the US by our subsidiary, Interparfums Luxury Brands.”
“Taking over U.S. distribution contributed to the 35 per cent increase in first quarter North American prestige product sales in local currency. Other markets that were especially strong during the period include South America and Eastern Europe, where comparable quarter sales in local currency were up 97 and 37 per cent, respectively."
The Jimmy Choo signature fragrance debuted with limited distribution in the first quarter. With strong demand on order renewals plus broader distribution anticipated in the second half, Inter Parfums is increasing its production forecast for the year.
Also contributing to the top line growth were Lanvin brand sales which, in local currency, were 35 per cent ahead of last year's first quarter.
Based upon sales of Montblanc's historic lines and the launch of Legend for men, brand sales are also running well ahead of budget. In local currency, comparable quarter Burberry brand sales declined 8 per cent, in line with expectations, as last year's first quarter benefited from the worldwide launch of Burberry Sport.
Sales continuing to rise in the US
Discussing US-based operations, Mr. Madar pointed out, "Following the 16 per cent sales growth achieved in 2010, sales continued to rise in 2011, owing to increased international distribution of specialty retail products and new product launches for the Gap and Banana Republic brands.”
Madar noted that most of the new product introductions, including the debut products for Betsey Johnson and Nine West, are timed for the second half of the year.
"Based upon strong first quarter sales, changes in foreign currency exchange rates and our expectations for the balance of the year, we are raising our 2011 guidance,” said Russell Greenberg, CFO.
“We currently expect net sales of approximately $550m resulting in net income attributable to Inter Parfums, of approximately $32.5m, or $1.05 per diluted share. Guidance assumes the dollar remains at current levels," he added.
In addition, on April 26, 2011 Inter Parfums renewed its license agreement with ST Dupont for the creation, development and distribution of fragrance lines for 5 and a half years until December 31, 2016 on mutually favorable terms and conditions.
Its initial 11 year license agreement was signed in June 1997, and had previously been extended in 2006 for an additional 3 years until June 3, 2011.