NEW YORK — With its Tommy Hilfiger and Coach businesses spurring sales, Movado Group Inc. reported double-digit earnings gains for the fourth quarter and year-end periods.
“We are sensing our brands’ awareness and position in each area of the market in which we compete,” said Efraim Grinberg, president and chief executive officer, during the company conference call.
For the three months ended Jan. 31, the Paramus, N.J.-based watch manufacturer saw earnings rise 16.4 percent to $7.2 million, or 28 cents a diluted share, in line with Wall Street analysts’ consensus estimate. Comparatively, the company reported earnings of $6.2 million, or 24 cents, in the year-ago period.
Sales shot up 29.4 percent to $120 million from $92.7 million, while comparable-store sales at the company’s boutique stores rose 2.9 percent.
“Sell-through was particularly strong in the fourth quarter as consumers responded enthusiastically to a new emphasis on our women’s product department,” said Grinberg during the call.
According to Grinberg, the Hilfiger business grew by more than 50 percent over the year. The company’s Concord line also posted double-digit sales gains for the quarter and the year, with record sales in Japan.
Indeed, Japan is proving to be a crucial component of the company’s efforts to expand in international markets. This is most evident when it comes to management’s views on the potential of the company’s Coach business.
“Our close partnership with Coach has enabled us to build a very successful watch business with one of the fastest- growing luxury brand names,” said Grinberg. “We experienced double-digit sales growth throughout fiscal 2005 with strong performances in Coach’s key markets, the U.S., Japan and Japanese travel destinations.”
According to the company, Ebel, which was acquired from LVMH Moët Hennessy Louis Vuitton in December 2003, accounted for $17.3 million in sales and was “slightly accretive” to earnings for the quarter.
For the year, earnings rose 15.1 percent to $26.3 million, or $1.03 a share, compared with earnings of $22.9 million, or 92 cents, in the prior year.
Sales spiked 26.9 percent to $419 million from $330.2 million.
This story first appeared in the March 24, 2005 issue of WWD. Subscribe Today.