NEW YORK — Higher royalty payments stemming from a new licensing agreement with Burberry overpowered rising sales for Inter Parfums Inc. in the third quarter.
For the three months ended Sept. 30, the New York-based beauty products manufacturer saw earnings slide 13.8 percent to $4 million, or 20 cents a diluted share, compared with earnings of $4.7 million, or 23 cents, in the year-ago period.
“The higher royalty provisions under the new Burberry license agreement has and will have a short-term impact on our bottom line, particularly for the second half of 2004 and the first half of 2005,” said Jean Madar, chairman and chief executive officer, in a statement.
Sales for the period rose 16.9 percent to $67.1 million from $57.4 million.
Selling, general and administrative expenses rose 440 basis points to 37.7 percent of sales, or $25.3 million, from 33.3 percent, or $19.1 million in the year-ago quarter. Again, the increase was largely because of the new Burberry licensing agreement that kicked in on July 1.
For the nine-month period, earnings increased 20.7 percent to $12.2 million, or 60 cents, from $10.1 million, or 51 cents, in the same period a year ago while sales spiked 26.3 percent to $172.2 million from $136.3 million.
In a statement, Madar expressed management’s faith in Burberry’s long-term growth opportunities and said the company was “exploring additional facets of the agreement, including the skin care category.”
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