Interparfums, Inc. IPAR reported fourth-quarter 2024 results, wherein the bottom line beat the Zacks Consensus Estimate. Both earnings and sales increased year over year.
Management hailed 2024 as the company’s best year ever, driven by record sales, profits and robust brand performance. The company’s top six brands, which account for about 70% of total sales, rose 5% in the fourth quarter, while newcomers, Lacoste and Roberto Cavalli, contributed 8% to quarterly sales growth. Strong demand across North America, Western Europe and Asia/Pacific, along with solid gains in the Middle East, Eastern Europe and South America, fueled overall growth.
Looking ahead to 2025, Interparfums is set to roll out an ambitious lineup of new product launches and brand expansions across its Europe and U.S. operations. A key highlight is the introduction of Solferino, the company’s first proprietary niche brand, launching this summer with a flagship boutique in Paris. With rising demand for prestige and luxury fragrances, the company anticipates sustained momentum and strong reorders in early 2025.
IPAR’s Quarterly Performance: Key Insights
Interparfums posted quarterly earnings of 82 cents per share, which surpassed the Zacks Consensus Estimate of 80 cents and increased 156% from 32 cents reported in the prior-year period.
Find the latest EPS estimates and surprises on Zacks Earnings Calendar.
Interparfums, Inc. Price, Consensus and EPS Surprise
Interparfums, Inc. Price, Consensus and EPS Surprise
Interparfums, Inc. price-consensus-eps-surprise-chart | Interparfums, Inc. Quote
The company reported consolidated net sales of $362 million, which increased 10% from $329 million posted in the year-ago period. This growth was driven by strong global demand for its key brands.
Sales from Europe-based operations rose 6% to $214 million, driven by strong performance from Jimmy Choo, the addition of Lacoste and effective execution across smaller brands. Notably, Jimmy Choo’s sales surged 11%, fueled by the ongoing success of the I Want Choo franchise.
U.S.-based net sales reached $149 million, indicating a robust 16% year-over-year increase, driven by strong performances from GUESS, Donna Karan/DKNY and the addition of Roberto Cavalli. GUESS fragrances saw 17% sales growth in the quarter, driven by continued demand for legacy scents.
Donna Karan/DKNY sales climbed 10%, propelled by the success of Donna Karan’s four-scent Cashmere Collection and the blockbuster launch of DKNY 24/7. Italian brands, Ferragamo and Roberto Cavalli, managed by the U.S. division, performed well. Ferragamo fragrances posted 13% sales growth in the fourth quarter.
Insight Into IPAR’s Costs & Margins Performance
IPAR’s consolidated gross profit rose 9.6% year over year to $233 million. The gross margin contracted 20 basis points (bps) to 64.5% compared with 64.7% in the fourth quarter of 2023. We expected the gross margin to be 64.7%.
During the quarter, selling, general and administrative expenses (SG&A) decreased 0.4% to $193 million. As a percentage of sales, SG&A expenses contracted 560 bps to 53.4%. We anticipated SG&A expenses, as a percentage of net sales, to decrease 660 bps.
The company’s operating income rose to $36 million, up from $18.9 million reported in the year-ago quarter. The operating margin expanded 430 bps to 10%. We expected the metric to be 12.4% in the fourth quarter of 2024.
IPAR’s Financial Health Snapshot
Interparfums ended the quarter with cash and cash equivalents of $125.4 million, long-term debt (excluding the current portion) of $115.7 million and total equity of $942.6 million.
The company announced a cash dividend of 80 cents per share, payable on March 28, 2025, to its shareholders of record as of March 14.
In February 2025, management approved a 7% increase in the annual cash dividend, raising it from $3.00 to $3.20 per share. This increase indicates management’s confidence in the company’s financial strength and its ability to drive long-term, sustainable sales and earnings growth.
What to Expect From IPAR in 2025
Despite economic uncertainty and unfavorable foreign exchange impacts, the company remains confident about its 2025 guidance, estimating net sales of $1.51 billion and EPS of $5.35, both indicating a 4% year-over-year increase.
This Zacks Rank #2 (Buy) stock has gained 0.7% in the past three months against the industry’s decline of 3.3%.
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