A tax benefit helped Movado Group drive up fourth-quarter earnings, but the watch company is planning cautiously this year and said it’s ready for trying economic times.
Net income in the quarter ended Jan. 31 shot up 39.6 percent to $19.6 million, or 72 cents a diluted share, on a 2.6 percent drop in sales to $130.6 million.
The firm registered a $16.2 million tax benefit during the quarter. Operating profits, which strip away the impact of taxes and other items, fell 78.9 percent to $3.2 million.
Overall, Efraim Grinberg, chief executive officer, said he was pleased with the firm’s results last year, which were supported by a broad base.
Movado sells watches under its namesake brand as well as the Tommy Hilfiger, Hugo Boss and Juicy Couture brands. About half of its wholesale revenues come from abroad.
“With our powerful brands and strong balance sheet, we are well positioned to weather these challenging times,” said Grinberg.
For the full year, earnings advanced 21.3 percent to $60.8 million, or $2.23 a diluted share, on a 5 percent rise in sales to $559.6 million.
For further coverage, see Friday’s issue of WWD.