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Inter Parfums (IPAR) Ups 2022 Guidance on Robust Q2 Sales

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Inter Parfums, Inc. IPAR released record sales numbers for second-quarter 2022. Following the upbeat sales numbers, management raised its top-and bottom-line view for 2022. The company announced that it is terminating the perfume license agreement with Repetto, effective Sep 28, 2022, with a mutual agreement of both parties.

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Closer Look at Q2 Sales

For the three months ended Jun 30, 2022, net sales surged 18% to $244.7 million compared with $207.6 million reported in the year-ago quarter. At comparable foreign currency rates, second-quarter net sales rallied 24% year over year.

During the second quarter, Inter Parfums’ Europe-based product sales came in at $166.3 million, up 3% from 2021 levels. U.S.-based product sales amounted to $78.4 million, surging 69% from second-quarter 2021. The company highlighted that sales in its U.S. operations were impressive, with comparable quarterly gains from GUESS?, Abercrombie & Fitch, Oscar de la Renta and MCM rising 39%, 40%, 35%, and 56%, respectively. Additional sales from Ferragamo fragrances also contributed to the upside. Further, legacy scents and flankers drove gains in the other brands. Management launched new flankers, including Authentic Moment by Abercrombie & Fitch and a collector’s edition of our MCM scent in the quarter under review. Also, the company launched Uomo by GUESS? in this period.

Talking about the European operations, the company highlighted that rise in the dollar masked gains of well-known brands. Nevertheless, brands like Montblanc, Jimmy Choo and Coach rose 6%, 4% and 13%, respectively, in U.S dollars. During the second quarter, management launched the Moncler duo, Jimmy Choo Man Aqua and Lanvin Mon Eclat. In addition, it rolled out Montblanc Legend Red, Kate Spade Sparkle and Coach Wild Rose, which debuted in the previous quarter.

Management highlighted that it has been facing several challenges, including inflation, supply chain disruptions, lockdowns, store closures, transportation issues, sanctions and currency headwinds. Apart from these, the slow recovery of international travel, logistics challenges in the United States and the war in Eastern Europe have been hurdles. Despite these headwinds, Inter Parfums has been witnessing solid growth on both sides of the Atlantic this year.

Raised 2022 View

Inter Parfums continues to witness a better-than-expected business performance. This and the level of booked orders for the back half of 2022 encouraged management to pull up its 2022 guidance. For 2022, Inter Parfums anticipates net sales of approximately $1 billion, up from almost $975 million projected earlier. The metric reflects growth from $879.5 million reported in 2021. Management now expects earnings per share (EPS) of $3.25 for 2022, indicating growth from $3.00 per share expected earlier. The company reported an EPS of $2.75 in 2021. The guidance is based on the assumption of no resurgence in coronavirus cases and the current level of the average dollar/euro exchange rate.

Product Launches on Track

Inter Parfums is on track with several new product launches for the second half of 2022. These include Cosmic Sky for Anna Sui, a new Away flanker for Abercrombie & Fitch and Ferragamo Bright Leather for U.S. operations. Inter Parfums will record its first sales of Donna Karan and DKNY fragrance during the back half of 2022.

The company will debut a new Coach men’s line and an extension of the Jimmy Choo I Want Choo line for European operations. Apart from these, it plans to introduce a new men’s line for Boucheron, two Rochas flankers for Byzance and Eau de Rochas and a new member of the Collection Extraordinaire by Van Cleef & Arpels.

The Zacks Rank #3 (Hold) company’s stock has gained 7% in the past year against the industry’s 42.7% decline.

Some Better-Ranked Staple Stocks

Some better-ranked stocks are Medifast MED and General Mills, Inc. GIS and Lamb Weston LW.

Medifast, which manufactures and distributes weight loss, weight management, healthy living products and other consumable health and nutritional products, currently carries a Zacks Rank #2 (Buy). MED has a trailing four-quarter earnings surprise of 12.9%, on average.You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for Medifast’s current financial year sales and earnings EPS suggests growth of almost 19% and 13.4%, respectively, from the year-ago reported figure.

General Mills, which manufactures and markets branded consumer foods worldwide, currently carries a Zacks Rank #2. GIS has a trailing four-quarter earnings surprise of 6.5%, on average.

The Zacks Consensus Estimate for General Mills’ current financial year sales and EPS suggests growth of 1.9% and 1.5%, respectively, from the year-ago reported figure.

Lamb Weston, which produces, distributes and markets value-added frozen potato products, carries a Zacks Rank #2. Lamb Weston has a trailing four-quarter earnings surprise of 18.1%, on average.

The Zacks Consensus Estimate for LW’s current financial year sales suggests growth of 9.3% from the year-ago reported number.


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