Movado Group, Inc. Announces Second Quarter Results
Movado Group, Inc. (NYSE: MOV) today announced second quarter and six-month results for the period ended July 31, 2019.
- Net sales increased 9.5% to $157.8 million, or 11.0% on a constant dollar basis;
- Operating income of $8.8 million versus $12.9 million in the prior year period; Adjusted operating income of $10.3 million versus $14.6 million in the prior year period; and
- Diluted EPS of $0.75; Adjusted diluted EPS of $0.36 compared to $0.45 in prior year period.
Efraim Grinberg, Chairman and Chief Executive Officer, stated, “Overall, we delivered sales growth of 9.5% and adjusted operating income of $10.3 million in the second quarter, despite an increasingly challenging environment for our category, planned incremental investments and currency headwinds. We are pleased with the market share gains of our licensed brand portfolio both internationally and domestically and saw strong digital sales growth on our movado.com site during the quarter. In a difficult marketplace, we are well positioned given the investments we’ve made over the last few years including building out our international markets, acquiring Olivia Burton and MVMT, developing important product innovation and establishing our digital center of excellence. As we look ahead, we will continue to make planned strategic investments across the business to support our brands as we focus on delivering long-term sustainable growth.”
Mr. Grinberg continued, “As we begin the second half of the year, we believe the innovation in our offerings and our strategic initiatives strengthen our position. Importantly, our product pipeline, including Movado Connect 2.0 and Movado Bold Evolution, will give us the opportunity to expand market share during the fall and holiday seasons. That said, we believe it is prudent to update our outlook given unfavorable currency rates, ongoing challenges in our category, the impact of tariffs and the increasingly volatile global environment.”
Non-GAAP Items (See attached table for GAAP and Non-GAAP measures)
Second quarter Fiscal 2020 results of operations included the following items:
- Operating expenses include a $1.1 million pre-tax charge, or $0.9 million after tax, representing $0.04 per diluted share, associated with the amortization of acquired intangible assets and deferred compensation related to the acquisition of MVMT;
- $0.7 million pre-tax charge, or $0.6 million after tax, representing $0.02 per diluted share, associated with the amortization of acquired intangible assets related to Olivia Burton;
- $0.3 million pre-tax gain, or $0.2 million after tax, representing $0.01 per diluted share, associated with the change in estimate of the remaining accrual for the fiscal 2018 cost saving initiatives; and
- Other non-operating income includes a $13.6 million pre-tax benefit, or $10.4 million after tax, representing $0.44 per diluted share, associated with the remeasurement of the contingent consideration liability associated with the MVMT acquisition.
Second quarter Fiscal 2019 results of operations included the following charges: