PARIS – Inter Parfums SA is banking on its new Coach fragrances and a major Rochas launch to spur its fortunes after reporting a 7 percent decline in first-half net profits.
Net income for the Paris-based subsidiary of Inter Parfums Inc., of New York, fell 7 percent to 13 million euros, or $14.5 million, in the six months ended June 30.
The company pointed to an exceptional tax provision of 1.8 million euros, or $2 million, and noted profits would have been up 6 percent excluding the charge.
Operating profits improved 1 percent to 21.6 million euros, or $24.1 million, while the gross margin was equivalent to 65.3 percent of sales, bolstered by the integration of Rochas fragrances and lower costs, especially for Montblanc and Jimmy Choo fragrances. Operating margin stood at around 13 percent.
As reported, Inter Parfums SA posted first-half sales of 162.3 million euros, or $181.1 million, a 10.3 percent gain. At constant exchange, revenues rose 10.5 percent.
Dollar figures are converted from euros at average exchange for the period to which they refer.
“The launch of Coach fragrances in the 2016 second half and a major Rochas fragrance initiative in the 2017 first half will give a new impetus to the group,” said Philippe Benacin, chairman and chief executive officer. “With Montblanc and Jimmy Choo having confirmed their positions as our portfolio’s flagship brands, the pace of revenue growth should on that basis start to pick up in 2017.”
“In 2017, we expect to be able to allocate a budget of nearly 100 million euros [or $112.6 million at current exchange] to marketing, advertising and point-of-sale merchandising,” stated Philippe Santi, executive vice president and chief financial officer of Inter Parfums SA.
Separately, Inter Parfums SA said it has extended its current fragrance license agreement with S.T. Dupont for three more years, through the end of 2019.
Inter Parfums SA’s other fragrance brands – some owned, some licensed – include Lanvin, Boucheron, Van Cleef & Arpels, Karl Lagerfeld, Paul Smith, Balmain and Repetto.