Interparfums earnings jump 25% in 2017 pushed by growth in North America
French perfume manufacturer Interparfums, Inc. reported its fourth quarter and full year 2017 results on Tuesday, showing strong growth in both sales and earnings as North America becomes its biggest global market and expectations for the impact of the company’s new Guess license run high for 2018.
Fourth quarter net sales totaled $149.5 million, an increase of 10.9% from $134.8 million in Q4 2016, or 6% in constant currencies.
European sales performed particularly well, rising 15.5% to $115.4 million from $99.9 million in the prior year period. US sales, however, slipped 2.2% to $34.1 million, from $34.9 million in the fourth quarter 2016.
Operating profit for the period totaled $4.8 million as compared to $5.4 million in Q4 2016, while total earnings increased 12% to $4.4 million compared to $3.9 million in the same period in the previous year.
Full year 2017 net sales increased to $591.3 million, compared to $521.1 million in 2016, a 13.5% rise or 12% in constant currencies.
North America became the company’s largest market during the year, registering sales gains of 19%. Western Europe and Asia, the company’s second and third largest markets, respectively, both saw an 8% increase in sales.
In a release, Jean Madar, chairman & CEO of Interparfums, broke down sales performance by brand in the US and Europe, highlighting strong North American growth for the company’s Dunhill and Oscar de la Renta fragrances.
“Regarding European based operations, our three largest brands all posted growth for the year, with Montblanc up 4%, Jimmy Choo up 20%, and Lanvin up 5%,” he stated, “Our newer brands performed exceptionally well last year, with Coach and Rochas brand sales growing 149% and 34%, respectively, versus one year earlier.”
Other international markets also reported solid improvements compared to the previous year: sales rose by 16% in Central and South America, 21% in the Middle East and 20% in Eastern Europe.
Overall earnings for 2017 came to $41.6 million, a 24.8% increase from 2016’s $33.3 million.
Interparfums is currently maintaining its previously reported 2018 guidance of net sales of around $620 million.
However, the company signed a fragrance licensing deal with Guess in February and expects the brand to have a strong positive impact on its sales in the US.
The group therefore plans to announce updated sales and earnings guidance when it reports its Q1 2018 results in May, once it has purchased Guess inventory from the brand’s former licensee and calculated the brand’s contribution, the effects of which are expected to be felt in the second quarter of this year.
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