Movado Group Inc., Paramus, N.J., plans to convert about $150 million in foreign earnings into U.S. dollars, it said Dec. 15. This is being done under the American Jobs Creation Act, a corporate tax law passed in 2004 that lets domestic companies repatriate overseas earnings under a lower tax rate.
It said it would record a one-time charge of about $8 million in the fourth quarter, ending Jan. 31, 2006, for the related tax expense.
The AJCA repatriation provision requires that funds be invested in qualified investments in the United States. Movado’s investments include: advertising and marketing expenditures, infrastructure and capital investments, including retail store expansion and renovation, headquarters expansion, information technology replacements and upgrades, employee hiring and training, and compensation and benefits for non-executive employees.
Movado Group, Inc. designs, manufactures, and distributes Movado, Ebel, Concord, ESQ, Coach, Tommy Hilfiger and Hugo Boss watches worldwide, and operates Movado boutiques and company stores in the United States.