Movado Group's sales in its first quarter that ended on April 30, rose 15.4 percent year on year to $103.7 million and cost of sales increased by only 8.2 percent to $44.6 million. The company, therefore, improved its profit to $6.6 million or 26 cents per share, compared with only $491,000 or 2 cents per share one year ago. Movado's strong performance was driven primarily by growth in the accessible luxury and licensed brand categories.
Efraim Grinberg, Movado's chairman, said that first quarter results were also a reflection of the strategic initiatives that were implemented recently. ''Specifically, as we have refined and refocused our product lines and introduced more frequent and focused innovation, we believe we have improved our competitive brand positioning and are seeing the results of these efforts,'' Grinberg said. ''While the macro-economic environment remains uncertain, we believe we have the right product and marketing programs in place to maintain consumer excitement throughout the balance of the year. With a solid foundation in place and consistent execution against our key strategic initiatives, we remain focused on delivering sustainable profitable growth.''
Rick Cote, the company's president, added, ''We are pleased with our momentum during the first quarter and the consistency we have restored in the business over the past nine quarters, which underscores the effectiveness of the brand and product strategies we have implemented. Strong double-digit top-line growth allowed us to grow operating income by $6.9 million to $8.5 million for the first quarter compared to last year, and more than double EBITDA to $11.5 million. As we continue to grow the business, our prudent expense control enabled us to leverage expenses during the quarter, while also continuing to invest in our brands.''
Movado anticipates that net sales will increase approximately 9 percent year on year to $505 million to $510 million for the fiscal year. The company anticipates net income to increase more than 25 percent to a range of $29 million to $29.7 million, or approximately $1.15 per diluted share.