WWD.com/beauty-industry-news/beauty-features/parlux-sees-earnings-bouncing-back-for-year-1156461/
government-trade
government-trade

Parlux Sees Earnings Bouncing Back For Year

NEW YORK -- Parlux Fragrances, emerging from a slump caused by discontinued lines, is projecting earnings in the fiscal year ending March 31 to increase more than tenfold to $1.5 million from $135,000 a year earlier.<BR><BR>For the current year,...

NEW YORK — Parlux Fragrances, emerging from a slump caused by discontinued lines, is projecting earnings in the fiscal year ending March 31 to increase more than tenfold to $1.5 million from $135,000 a year earlier.

For the current year, Frederick Purches, vice chairman of Parlux, projected earnings per share at 54 cents, while they were 5 cents in 1993 on fewer shares.

At an analysts’ meeting Tuesday, Robert J. Kaufman, president and chief operating officer, said it has taken Parlux “three years to write off the sins of the past,” particularly the failed Joan Collins Spectacular fragrance line.

Parlux was also hurt by discontinuing its agreement to market Anne Klein scents, which accounted for 61 percent of sales in fiscal 1991.

Kaufman noted that in addition to specialty stores, discount retailer Perfumania is “an important niche for Parlux,” accounting for 30 percent of its distribution. Ilia Lekach, Perfumania’s chairman and chief executive officer, is also chairman and ceo of Parlux.

As reported, Lekach has been in talks with Revlon to sell Perfumania’s retail units. Kaufman said the sale of Perfumania’s retail or wholesale business would “have no effect” on Parlux, because the agreements under which Parlux has to supply Perfumania would continue.

Lekach said that in addition to Revlon, he is in talks with other interested parties who might purchase all or part of Perfumania. He said he plans to retain Wasserstein & Perella Securities to help with the negotiations. For the third quarter ended Dec. 31, Purches projected Parlux earnings at $386,000, against $25,000 a year ago, despite a sales drop to $6.78 million from $9.3 million. Fourth-quarter earnings should be about $892,000, against $1.4 million a year ago, with sales slipping to $8.39 million from $8.63 million.

Going forward, Purches projects annual sales growth of 20 percent, driven by new products and line extensions.

A new Todd Oldham scent is scheduled for introduction in September in specialty stores, and a new Vicky Tiel scent is slated for March.

Purches predicted sales of $32 million to $33 million for fiscal 1995, but declined to project earnings.