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Inter Parfums (IPAR) Q1 Earnings Top Estimates, Increase Y/Y
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Inter Parfums, Inc. (IPAR - Free Report) delivered solid first-quarter 2021 results, as both top and bottom lines surged year over year and the latter cruised past the Zacks Consensus Estimate. Management stated that sales growth was greater than its expectations and hence, the company’s promotion and advertising expenditures were relatively lower. The company further stated that it expects SG&A expenses to normalize as Inter Parfums resumes more activities. Promotional and advertising expenses are especially anticipated to reach historical levels of 21% of net sales.
Well, Inter Parfums’ business has been particularly sturdy in regions where lockdowns have been eased, stores have reopened and activities have reverted to the old normal, especially in Asia and North America. On the contrary, Western Europe continues to grapple with pandemic-led closures and limitations associated with the third wave. Meanwhile, the company saw revivals in the Middle East, Eastern Europe, and Central and South America. Certainly, Inter Parfums has been focused on augmenting growth and exploring potential license deals with different brands in this respect.
Quarter in Detail
Inter Parfums posted earnings per share of 87 cents, which easily surpassed the Zacks Consensus Estimate of 63 cents. Moreover, the metric increased significantly from 32 cents per share reported in the year-ago quarter.
Inter Parfums, Inc. Price, Consensus and EPS Surprise
Net sales surged 37.1% to $198.5 million compared with $144.8 million recorded in the year-ago period. The Zacks Consensus Estimate stood at $198 million. At comparable exchange rates, consolidated net sales advanced 32.7%. During the quarter, European product sales surged 40% to $159.7 million and U.S.-based product sales grew 26.2% to $38.8 million from the year-ago period.
In European operations, Montblanc, Jimmy Choo, Coach and Lanvin brands registered sales growth of 27.4%, 66.7%, 8.8% and 91.2%, respectively. Sales at Montblanc and Lanvin brands were backed by strength in legacy scents, with the latter seeing solid growth in key markets — Asia and Eastern Europe. Sales growth at the Coach brand resulted from favorable currency movements as well as higher sales volumes. Jimmy Choo sales were aided by robust sales of established Jimmy Choo scents, together with the successful launch of I Want Choo in the quarter under review. Apart from these, impressive initial sales of Kate Spade New York and Rochas Girl backed first-quarter sales.
Moving to the U.S. operations, which also recorded robust growth in the quarter under review, the company’s largest brand, GUESS, continued gaining on legacy fragrance sales as well as the initial distribution of Bella Vita. Moreover, solid replenishment orders for Abercrombie & Fitch’s Authentic Night duo, which debuted last year, aided growth. Sales of the Hollister brand were led by Canyon Escape duo shipments. Additionally, the Dunhill brand delivered a strong show, thanks to its new signature scent. The debut of the MCM signature scent toward the end of the first quarter also led to the upside. We note that the global rollout of the product is now underway.
In U.S. operations, the Anna Sui brand witnessed a sequential sales decline, as the launch of Sky in the fourth quarter of 2020 largely boosted sales in that quarter. Also, Anna Sui sales were hurt by the soft travel retail/duty-free market. Nonetheless, the company has considerable Anna Sui open orders and remains well placed for improved sales in the brand as the year proceeds.
Inter Parfums’ gross margin was 63.1%, up 160 basis points from 61.5% posted in the year-ago quarter. SG&A expenses amounted to $74.9 million, up from $71.3 million reported in the year-ago quarter. Operating income came in at $48 million, up significantly from $17.8 million reported in the year-ago quarter. Further, operating margin was 24%, up from the year-ago quarter’s 12%.
Other Financial Aspects
The company ended the quarter with cash and cash equivalents of $143.3 million, long-term debt (excluding current portion) of $9.2 million and shareholder’s equity of $540.1 million. Cash provided by operating activities amounted to $32.5 million during the first quarter of 2021.
The company announced a quarterly dividend of 25 cents per share, to be paid out on Jun 30, 2021, to shareholders of record as of Jun 15.
Other Updates
The company continues to roll out products that were introduced in the first quarter of 2021, which includes Oscar de la Renta’s Alibi , GUESS’s Bella Vita , the debut of MCM scent and Hollister’s Canyon Escape. Product pipeline for the remaining part of the year includes brand extensions such as flankers for Montblanc Explorer, Coach Dreams, Jimmy Choo Urban Hero, the Oscar de la Renta Bella family, the Hollister Wave collection, and the Anna Sui Fantasia pillar. Apart from these, the company has absolutely new fragrances planned for the coming quarters, including a Lanvin women’s line, Abercrombie & Fitch’s new duo, Dunhill’s Driven collection for men and GUESS’s men’s grooming collection.
Guidance
The company reiterated its recently updated guidance for 2021. Management anticipates 2021 net sales to be nearly $700 million, while net income per share is expected to be $1.65. We note that the latest view is based on the assumption of no major resurgence in coronavirus cases and the current level of the average dollar/euro exchange rate.
This Zacks Rank #1 (Strong Buy) stock has gained 7.1% in the past three months compared with the industry’s growth of 5.8%.
United Natural (UNFI - Free Report) has a Zacks Rank #2 (Buy) and its bottom line outpaced the Zacks Consensus Estimate by 13.6% in the trailing four quarters, on average.
Nu Skin (NUS - Free Report) has a Zacks Rank #2 and its bottom line outpaced the Zacks Consensus Estimate by 18.8% in the trailing four quarters, on average.
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Inter Parfums (IPAR) Q1 Earnings Top Estimates, Increase Y/Y
Inter Parfums, Inc. (IPAR - Free Report) delivered solid first-quarter 2021 results, as both top and bottom lines surged year over year and the latter cruised past the Zacks Consensus Estimate. Management stated that sales growth was greater than its expectations and hence, the company’s promotion and advertising expenditures were relatively lower. The company further stated that it expects SG&A expenses to normalize as Inter Parfums resumes more activities. Promotional and advertising expenses are especially anticipated to reach historical levels of 21% of net sales.
Well, Inter Parfums’ business has been particularly sturdy in regions where lockdowns have been eased, stores have reopened and activities have reverted to the old normal, especially in Asia and North America. On the contrary, Western Europe continues to grapple with pandemic-led closures and limitations associated with the third wave. Meanwhile, the company saw revivals in the Middle East, Eastern Europe, and Central and South America. Certainly, Inter Parfums has been focused on augmenting growth and exploring potential license deals with different brands in this respect.
Quarter in Detail
Inter Parfums posted earnings per share of 87 cents, which easily surpassed the Zacks Consensus Estimate of 63 cents. Moreover, the metric increased significantly from 32 cents per share reported in the year-ago quarter.
Inter Parfums, Inc. Price, Consensus and EPS Surprise
Inter Parfums, Inc. price-consensus-eps-surprise-chart | Inter Parfums, Inc. Quote
Net sales surged 37.1% to $198.5 million compared with $144.8 million recorded in the year-ago period. The Zacks Consensus Estimate stood at $198 million. At comparable exchange rates, consolidated net sales advanced 32.7%. During the quarter, European product sales surged 40% to $159.7 million and U.S.-based product sales grew 26.2% to $38.8 million from the year-ago period.
In European operations, Montblanc, Jimmy Choo, Coach and Lanvin brands registered sales growth of 27.4%, 66.7%, 8.8% and 91.2%, respectively. Sales at Montblanc and Lanvin brands were backed by strength in legacy scents, with the latter seeing solid growth in key markets — Asia and Eastern Europe. Sales growth at the Coach brand resulted from favorable currency movements as well as higher sales volumes. Jimmy Choo sales were aided by robust sales of established Jimmy Choo scents, together with the successful launch of I Want Choo in the quarter under review. Apart from these, impressive initial sales of Kate Spade New York and Rochas Girl backed first-quarter sales.
Moving to the U.S. operations, which also recorded robust growth in the quarter under review, the company’s largest brand, GUESS, continued gaining on legacy fragrance sales as well as the initial distribution of Bella Vita. Moreover, solid replenishment orders for Abercrombie & Fitch’s Authentic Night duo, which debuted last year, aided growth. Sales of the Hollister brand were led by Canyon Escape duo shipments. Additionally, the Dunhill brand delivered a strong show, thanks to its new signature scent. The debut of the MCM signature scent toward the end of the first quarter also led to the upside. We note that the global rollout of the product is now underway.
In U.S. operations, the Anna Sui brand witnessed a sequential sales decline, as the launch of Sky in the fourth quarter of 2020 largely boosted sales in that quarter. Also, Anna Sui sales were hurt by the soft travel retail/duty-free market. Nonetheless, the company has considerable Anna Sui open orders and remains well placed for improved sales in the brand as the year proceeds.
Inter Parfums’ gross margin was 63.1%, up 160 basis points from 61.5% posted in the year-ago quarter. SG&A expenses amounted to $74.9 million, up from $71.3 million reported in the year-ago quarter. Operating income came in at $48 million, up significantly from $17.8 million reported in the year-ago quarter. Further, operating margin was 24%, up from the year-ago quarter’s 12%.
Other Financial Aspects
The company ended the quarter with cash and cash equivalents of $143.3 million, long-term debt (excluding current portion) of $9.2 million and shareholder’s equity of $540.1 million. Cash provided by operating activities amounted to $32.5 million during the first quarter of 2021.
The company announced a quarterly dividend of 25 cents per share, to be paid out on Jun 30, 2021, to shareholders of record as of Jun 15.
Other Updates
The company continues to roll out products that were introduced in the first quarter of 2021, which includes Oscar de la Renta’s Alibi , GUESS’s Bella Vita , the debut of MCM scent and Hollister’s Canyon Escape. Product pipeline for the remaining part of the year includes brand extensions such as flankers for Montblanc Explorer, Coach Dreams, Jimmy Choo Urban Hero, the Oscar de la Renta Bella family, the Hollister Wave collection, and the Anna Sui Fantasia pillar. Apart from these, the company has absolutely new fragrances planned for the coming quarters, including a Lanvin women’s line, Abercrombie & Fitch’s new duo, Dunhill’s Driven collection for men and GUESS’s men’s grooming collection.
Guidance
The company reiterated its recently updated guidance for 2021. Management anticipates 2021 net sales to be nearly $700 million, while net income per share is expected to be $1.65. We note that the latest view is based on the assumption of no major resurgence in coronavirus cases and the current level of the average dollar/euro exchange rate.
This Zacks Rank #1 (Strong Buy) stock has gained 7.1% in the past three months compared with the industry’s growth of 5.8%.
3 Other Consumer Staple Stocks Worth a Look
Medifast (MED - Free Report) , which currently carries a Zacks Rank #1, has a trailing four-quarter earnings surprise of 12.7%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.
United Natural (UNFI - Free Report) has a Zacks Rank #2 (Buy) and its bottom line outpaced the Zacks Consensus Estimate by 13.6% in the trailing four quarters, on average.
Nu Skin (NUS - Free Report) has a Zacks Rank #2 and its bottom line outpaced the Zacks Consensus Estimate by 18.8% in the trailing four quarters, on average.
Bitcoin, Like the Internet Itself, Could Change Everything
Blockchain and cryptocurrency has sparked one of the most exciting discussion topics of a generation. Some call it the “Internet of Money” and predict it could change the way money works forever. If true, it could do to banks what Netflix did to Blockbuster and Amazon did to Sears. Experts agree we’re still in the early stages of this technology, and as it grows, it will create several investing opportunities.
Zacks’ has just revealed 3 companies that can help investors capitalize on the explosive profit potential of Bitcoin and the other cryptocurrencies with significantly less volatility than buying them directly.
See 3 crypto-related stocks now >>