Movado Group Inc announced second quarter results for the period ended July 31, 2006.
Second Quarter Fiscal 2007
- Net sales increased 9.8 percent to $126.6 million from $115.3 million last year.
- Comparable store sales increased 9.3 percent at the Company's Movado boutiques versus a 2.3 percent increase in the year-ago period.
- Gross margin improved 130 basis points to 62.0 percent compared to 60.7 percent last year.
- Operating profit increased 14.6 percent to $14.1 million, or 11.1 percent of sales, Versu 12.3 million, or 10.7 percent of sales in the year-ago period.
- Net interest expense was $0.3 million versus $0.9 million last year.
- Interest expense for the quarter was the same as the year-ago Period, $0.9 million, with average borrowings in the quarter of $99.3 million at an average borrowing rate of 3.7 percent.
- Interest income for the quarter was $0.6 million due to short term investments of cash-on-hand resulting from the repatriation of foreign earnings under the American Jobs Creation Act.
- Income tax expense of $2.4 million reflects a 17.5 percent tax rate in the second quarter compared to income tax expense of $2.9 million, or a 25.0 percent tax rate, recorded last year.
The favorable tax rate benefited second quarter diluted earnings per share by $0.04 and reflects the continued utilization of a Swiss net operating loss carryforward (NOL) acquired with the Ebel brand in fiscal 2005.
The Company anticipates maintaining the 17.5 percent tax rate for the balance of fiscal 2007.
- Net income increased to $11.3 million, or $0.43 per diluted share, compared to net income of $8.6 million, or $0.33 per diluted share, in the prior year period.
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