MOVADO SURPASSES EXPECTATIONS
NEW YORK — Movado Group Inc. came back from a difficult year to wind up with fourth-quarter profits that exceeded analysts’ expectations by 4 cents.
The Paramus, N.J.-based watchmaker reported net income jumped 26 percent to $4.6 million, or 38 cents a share, compared to $3.7 million, or 31 cents, in last year’s fourth quarter. Wall Street had forecast earnings per share of 34 cents. Sales ran down 13.3 percent to $74.8 million from $86.2 million in the year-ago period.
The firm, which designs, manufactures and distributes watches under the Movado, Concord, ESQ, Coach and Tommy Hilfiger brands, attributed the earnings to tighter fiscal management.
“Our growth was driven by improved expense control, lower borrowing costs and the benefit of a lower tax rate in the fourth quarter,” said chief executive officer Efraim Grinberg. “Although we believe this spring will be challenging, we are cautiously optimistic in the second half. Because of the significant investment we have put behind our brands, our company has a long history of exiting recessions in a very strong manner, and we believe we can do it again this year.”
Given that, Movado expects EPS in fiscal 2003 to increase by approximately 15 percent compared to fiscal 2002, with the majority of sales and earnings coming during the last six months of the year.
Overall, in fiscal 2002, Movado’s net income declined 17.5 percent to $17.1 million, or $1.42, against $20.8 million, or $1.75, in the prior year. The company beat Wall Street forecasts for fiscal 2002 by 6 cents. Excluding one-time charges and tax rate adjustments, Movado would have posted an 18.3 percent drop in net earnings to $17 million, or $1.41 a share.
Sales for the year slipped 6.6 percent to $299.7 million.