Inter Parfums Inc (IPAR) has reported a 14.20 percent rise in profit for the quarter ended Sep. 30, 2016. The company has earned $16.24 million, or $0.52 a share in the quarter, compared with $14.22 million, or $0.46 a share for the same period last year.
Revenue during the quarter grew 13.44 percent to $157.62 million from $138.94 million in the previous year period. Gross margin for the quarter contracted 161 basis points over the previous year period to 60.16 percent. Total expenses were 79.51 percent of quarterly revenues, down from 80.11 percent for the same period last year. This has led to an improvement of 60 basis points in operating margin to 20.49 percent.
Operating income for the quarter was $32.30 million, compared with $27.64 million in the previous year period.
Jean Madar, chairman & chief executive officer of Inter Parfums, Inc. noted, “We achieved good growth from both our European and U.S. operations during the third quarter. For our European operations, sales of our first Coach scent for women exceeded expectations, generating $13.8 million in incremental sales. Montblanc, our largest brand, performed exceptionally well, generating sales of $32.9 million, an 11% increase compared with last year’s third quarter with most of the credit going to the enduring popularity of the Legend fragrance family. Rochas fragrance sales more than doubled to $7.0 million from last year’s third quarter thanks to the loyal following of the brand’s two legacy fragrances, Eau de Rochas and Rochas Man in Spain and France. Our Van Cleef & Arpels Collection Extraordinaire also contributed to our top line growth as did the Lanvin’s Modern Princess line, which was in limited distribution in France during the third quarter. As previously reported, the 2015 launch of Illicit for our second largest brand, Jimmy Choo, made for a difficult comparison with brand sales in the current third quarter. However, year-to-date, brand sales are running about equal to those of the same period of last year.”
Inter Parfums projects revenue to be in the range of $500 million to $510 million for financial year 2016. For financial year 2016, the company forecasts diluted earnings per share to be in the range of $1.05 to $1.10.
Working capital remains almost stable
Inter Parfums Inc has witnessed a decline in the working capital over the last year. It stood at $351.09 million as at Sep. 30, 2016, down 0.53 percent or $1.86 million from $352.95 million on Sep. 30, 2015. Current ratio was at 3.65 as on Sep. 30, 2016, down from 4.02 on Sep. 30, 2015.
Cash conversion cycle (CCC) has decreased to 75 days for the quarter from 193 days for the last year period. Days sales outstanding went down to 70 days for the quarter compared with 75 days for the same period last year.
Days inventory outstanding has decreased to 77 days for the quarter compared with 199 days for the previous year period. At the same time, days payable outstanding went down to 72 days for the quarter from 80 for the same period last year.
Debt comes down
Inter Parfums Inc has recorded a decline in total debt over the last one year. It stood at $84.74 million as on Sep. 30, 2016, down 20.46 percent or $21.79 million from $106.54 million on Sep. 30, 2015. Total debt was 12.01 percent of total assets as on Sep. 30, 2016, compared with 15.33 percent on Sep. 30, 2015. Debt to equity ratio was at 0.17 as on Sep. 30, 2016, down from 0.22 as on Sep. 30, 2015. Interest coverage ratio improved to 62.72 for the quarter from 26.55 for the same period last year.
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