Movado Group beats by $0.19, beats on revs; raises FY18 EPS, revs outlook (28.90)
- Reports Q3 (Oct) earnings of $1.04 per share, excluding non-recurring items, $0.19 better than the Capital IQ Consensus of $0.85; revenues rose 6.0% year/year to $190.69 mln vs the $176.33 mln Capital IQ Consensus.
- Gross profit was $104.1 million, or 54.6% of sales, compared to $98.6 million, or 54.8% of sales, in the third quarter last year. Adjusted gross profit was $104.7 million, or 54.9% of sales, which primarily excludes $0.6 million of amortization of acquisition accounting adjustments related to the Olivia Burton brand. The increase in adjusted gross margin percentage was primarily the result of a reduction of certain fixed costs due to the cost savings initiatives and favorable changes in foreign currency exchange rates, partially offset by channel and product mix.
- Given the expanding digital world and the changing retail landscape, the Company has decided to no longer exhibit its brands at the annual Baselworld Watch and Jewelry Fair in Switzerland. The Company plans to reinvest the approximate $10 million of annual savings in other marketing activities, including digital brand-building and sales growth initiatives. As a result of this decision, the Company recorded a pre-tax charge of $6.3 million in the third quarter of fiscal 2018 as part of its cost savings initiatives.
- Co raises guidance for FY18, sees EPS of $1.70-1.75 (Prior $1.50-1.65), excluding non-recurring items, vs. $1.63 Capital IQ Consensus Estimate; sees FY18 revs of $550-555 mln (Prior $530-545 mln) vs. $539.83 mln Capital IQ Consensus Estimate.