Movado Group reports 12 percent quarterly sales gain

The Movado Group reports gains of almost 12 percent for net sales in its third quarter and more than 15 percent for the first nine months for fiscal 2006, which ended Oct. 31.

The watchmaker, headquartered in Paramus, N.J., said:

* Net sales increased 11.6 percent to $141.7 million, from $127 million last year. 

* Comparable store sales increased 10.6 percent at the company’s Movado boutiques, versus a 12.8 percent gain achieved last year.

* Gross margin remained strong at 60.8 percent.

* Operating profit increased 18.9% to $19 million, versus $16 million last year.

* Other income for the quarter of $1 million included two unusual items: A gain of $2.6 million generated from the sale of a building acquired with Ebel, which more than offset a $1.6 million loss associated with accounting for foreign currency hedge derivatives.

* Net income was $14.1 million. Net income was $11.3 million, or $0.44 per diluted share, in the year-ago period.

For the nine months of fiscal 2006, Movado said:

* Net sales increased 15.3 percent to $344.8 million from $299 million last year. 

* Comparable store sales increased 5 percent at the company’s Movado
boutiques, versus a 16.7 percent gain achieved last year.

* Gross margin was 60.6 percent compared to 59.7 percent in the year-ago period.

* Operating profit increased 26.5 percent to $33.4 million versus $26.4 million last year.

* Other income for the nine-month period of $1.0 million included the aforementioned unusual items recorded in the third quarter of fiscal 2006. Other income of $1.4 million recorded in the prior year period reflected the one-time gain associated with a legal settlement the company reached with Swiss Army Brands. 

* Net income was $23.7 million compared to $19.1 million in the prior year period. 

“In a period that presented several challenges including hurricanes and higher energy prices, we’re very pleased with our overall results delivered in the third quarter,” said Efraim Grinberg, Movado president and CEO.