Movado Group Inc. posted a 55 percent increase in third-quarter earnings last Thursday, driven by the luxury watchmaker's brand strength and operating efficiencies.
"Throughout the quarter and year-to-date period, our global team demonstrated strong operating disciplines, which translated into expanded gross margins and operating profit growth," said Rick Cote, executive vice president and chief operating officer, in a statement. "During the quarter, we also took advantage of an opportunity to convert discontinued product into cash, thereby improving our inventory mix and driving cash flow."
For the three months ended Oct. 31, net income rose to $21.9 million, or 82 cents a diluted share, from $14.1 million, or 54 cents, in the year-ago period. Excluding special items, earnings for the quarter totaled 64 cents per share. Sales, which included $12.1 million from discontinued product, jumped 17.3 percent to $166.3 million from $141.7 million. Total same-store sales increased 0.5 percent compared with a 10.6 percent gain last year.
For the nine-month period earnings ballooned 52.6 percent to $36.1 million, or $1.35 a diluted share, from $23.7 million, or 91 cents last year. Sales shot up to $390.6 million from $344.8 million, a 13.3 percent increase.
Movado saw the most growth with its Ebel category, which posted double-digit sales as the company marked the anniversary of last year's strong third quarter.
The company said that it expects fiscal 2007 earnings in the range of $1.77 cents to $1.82 cents per share.
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