Movado Group, Inc. Announces First Quarter Results
~ Net Sales Increased 9.9% to
~ Operating Income Increased 9.2% to
~ Reiterates Full Year Guidance ~
~ Board Declares Quarterly Dividend ~
There were no unusual items recorded in the first quarter of fiscal
2015. During the first quarter of fiscal 2014, the Company recorded a
First Quarter Fiscal 2015 Results
-
Net sales increased 9.9% to
$120.9 million compared to$110.0 million in the first quarter of fiscal 2014 driven primarily by growth in the licensed brand category. -
Gross profit was
$65.2 million , or 53.9% of sales, compared to$59.9 million , or 54.5% of sales, in the first quarter last year. The planned decline in gross margin percentage was primarily the result of the unfavorable impact of changes in foreign currency exchange rates and channel and product mix partially offset by leverage gained on certain fixed costs. -
Operating expenses were
$54.2 million as compared to$49.9 million in the first quarter last year. This increase was primarily the result of an increase in compensation and benefits expense, higher marketing expenses and an increase due to the translational impact of foreign currency exchange rates. -
Operating income increased 9.2% to
$10.9 million compared to$10.0 million in the same period last year. -
The Company recorded a tax provision of
$3.4 million , which equates to an effective tax rate of 31.6%, as compared to a tax provision of$3.3 million and an effective tax rate of 28.8% in the first quarter last year. -
Net income was
$7.4 million , or$0.29 per diluted share, compared to net income of$8.2 million , or$0.32 per diluted share, including a$0.04 per share gain related to the sale of a Company-owned building inSwitzerland , in the first quarter of fiscal 2014.
Rick Coté, President and Chief Operating Officer, stated, “We are
pleased with our strong first quarter results which reflect solid
momentum in our business driven by a favorable response to our
Fiscal 2015 Guidance
The Company is reiterating guidance for fiscal 2015 which is on a
comparable basis to non-GAAP fiscal 2014 results adjusted for unusual
items. In fiscal 2015, the Company anticipates that net sales will
increase approximately 10.7% to
Quarterly Dividend
The Company also announced that on
Conference Call
The Company’s management will host a conference call and audio webcast
to discuss its results today,
This press release contains certain forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995. The
Company has tried, whenever possible, to identify these forward-looking
statements using words such as “expects,” “anticipates,”
“believes,” “targets,” “goals,” “projects,” “intends,” “plans,” “seeks,”
“estimates,” “may,” “will,” “should” and variations of such words and
similar expressions. Similarly, statements in this press release that
describe the Company's business strategy, outlook, objectives, plans,
intentions or goals are also forward-looking statements. Accordingly,
such forward-looking statements involve known and unknown risks,
uncertainties and other factors that could cause the Company's actual
results, performance or achievements and levels of future dividends to
differ materially from those expressed in, or implied by, these
statements. These risks and uncertainties may include, but are not
limited to general economic and business conditions which may impact
disposable income of consumers in
MOVADO GROUP, INC. | |||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||
(In thousands, except per share data) |
|||||||||||||
(Unaudited) | |||||||||||||
Three Months Ended | |||||||||||||
April 30, | |||||||||||||
2014 | 2013 | ||||||||||||
Net sales | $ | 120,921 | $ | 110,010 | |||||||||
Cost of sales | 55,770 | 50,091 | |||||||||||
Gross profit | 65,151 | 59,919 | |||||||||||
Operating expenses | 54,230 | 49,914 | |||||||||||
Operating income | 10,921 | 10,005 | |||||||||||
Other income | - | 1,526 | |||||||||||
Interest expense | (94 | ) | (65 | ) | |||||||||
Interest income | 35 | 23 | |||||||||||
Income before income taxes | 10,862 | 11,489 | |||||||||||
Provision for income taxes | 3,433 | 3,310 | |||||||||||
Net income | 7,429 | 8,179 | |||||||||||
Less: Net income / (loss) attributed to noncontrolling interests | 64 | (31 | ) | ||||||||||
Net income attributed to Movado Group, Inc. | $ | 7,365 | $ | 8,210 | |||||||||
Per Share Information: | |||||||||||||
Net income attributed to Movado Group, Inc. | $ | 0.29 | $ | 0.32 | |||||||||
Weighted diluted average shares outstanding | 25,696 | 25,873 |
MOVADO GROUP, INC. | ||||||||||||||
CONSOLIDATED BALANCE SHEETS | ||||||||||||||
(In thousands) | ||||||||||||||
(Unaudited) | ||||||||||||||
April 30, | January 31, | April 30, | ||||||||||||
2014 | 2014 | 2013 | ||||||||||||
ASSETS | ||||||||||||||
Cash and cash equivalents | $ | 137,827 | $ | 157,659 | $ | 141,484 | ||||||||
Short-term investments | 34,063 | 33,099 | - | |||||||||||
Trade receivables | 77,395 | 68,683 | 66,675 | |||||||||||
Inventories | 184,443 | 181,305 | 175,136 | |||||||||||
Other current assets | 47,228 | 44,564 | 36,571 | |||||||||||
Total current assets | 480,956 | 485,310 | 419,866 | |||||||||||
Property, plant and equipment, net | 46,806 | 47,796 | 46,289 | |||||||||||
Deferred income taxes | 15,058 | 14,891 | 22,434 | |||||||||||
Other non-current assets | 32,064 | 30,613 | 26,790 | |||||||||||
Total assets | $ | 574,884 | $ | 578,610 | $ | 515,379 | ||||||||
LIABILITIES AND EQUITY | ||||||||||||||
Accounts payable | $ | 25,644 | $ | 33,598 | $ | 24,421 | ||||||||
Accrued liabilities | 36,854 | 43,573 | 34,358 | |||||||||||
Deferred and current income taxes payable | 5,777 | 6,422 | 1,412 | |||||||||||
Total current liabilities | 68,275 | 83,593 | 60,191 | |||||||||||
Deferred and non-current income taxes payable | 3,792 | 3,518 | 5,689 | |||||||||||
Other non-current liabilities | 27,244 | 25,509 | 22,626 | |||||||||||
Noncontrolling interests | 2,821 | 2,686 | 1,933 | |||||||||||
Shareholders' equity | 472,752 | 463,304 | 424,940 | |||||||||||
Total liabilities and equity | $ | 574,884 | $ | 578,610 | $ | 515,379 |
MOVADO GROUP, INC. | |||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||||
(In thousands) | |||||||||||||
(Unaudited) | |||||||||||||
Three Months Ended | |||||||||||||
April 30, | |||||||||||||
2014 | 2013 | ||||||||||||
Cash flows from operating activities: | |||||||||||||
Net income | $ | 7,429 | $ | 8,179 | |||||||||
Depreciation and amortization | 3,022 | 2,756 | |||||||||||
Other non-cash adjustments | 1,876 | (684 | ) | ||||||||||
Changes in working capital | (24,606 | ) | (27,304 | ) | |||||||||
Changes in non-current assets and liabilities | 226 | (727 | ) | ||||||||||
Net cash (used in) operating activities | (12,053 | ) | (17,780 | ) | |||||||||
Cash flows from investing activities: | |||||||||||||
Capital expenditures | (1,523 | ) | (6,469 | ) | |||||||||
Proceeds from sale of an asset held for sale | - | 2,196 | |||||||||||
Trademarks | (20 | ) | (86 | ) | |||||||||
Net cash (used in) investing activities | (1,543 | ) | (4,359 | ) | |||||||||
Cash flows from financing activities: | |||||||||||||
Dividends paid | (2,523 | ) | (1,272 | ) | |||||||||
Stock repurchase | (5,312 | ) | (467 | ) | |||||||||
Other financing | (466 | ) | (603 | ) | |||||||||
Net cash (used in) financing activities | (8,301 | ) | (2,342 | ) | |||||||||
Effect of exchange rate changes on cash and cash equivalents | 2,065 | (1,924 | ) | ||||||||||
Net change in cash and cash equivalents | (19,832 | ) | (26,405 | ) | |||||||||
Cash and cash equivalents at beginning of year | 157,659 | 167,889 | |||||||||||
Cash and cash equivalents at end of period | $ | 137,827 | $ | 141,484 |
Source:
ICR, Inc.
Rachel Schacter/Allison Malkin, 203-682-8200