THE WHAT? Inter Parfums has announced a 16 percent YOY Q3, with net sales reaching $160.6 million, down from $191.2 million. However, the drop was not as severe as predicted, beating expectations by 49 percent, according to Yahoo Finance.
THE DETAILS Statutory earnings per share (EPS) of US$0.52 exceeded forecasts by 19 percent.
Geographically, net sales in Europe were down 9.6% to $129.7 million from $143.6 million, while U.S. based operations fell 35.1 percent to $30.9 million from $47.6 million YOY.
Speaking to Happi, Russell Greenberg, Executive Vice President and CFO, highlighted that the company has cut or postponed all promotional activity to 2021.
He said, “In response to the impact of the Covid-19 pandemic, most of our 2020 promotional programs, especially those for new product introductions, were postponed until 2021.
“In the third quarter, promotion and advertising represented 10.9% of net sales, as compared to 15.0% in last year’s third quarter. In dollars, that’s a savings of more than $11 million, bringing promotion and advertising included in S, G & A down to $17.6 million from $28.7 million in the third quarter of 2019.”
THE WHY? Discussing the results, Jean Madar, chairman & CEO of Inter Parfums, said, “As compared to the preceding quarter, sales rallied across all of our markets, with the three largest, North America, Western Europe and Asia, achieving significant gains.
“As a result, when compared to the second quarter, third quarter net sales increased 224%; gross margin rose 630 basis points; our operating margin returned to a more normalized level of 19.5%; and once again, our bottom line was solidly profitable.