Movado Group Reports Q1 FY2015 Miss; Reiterates Guidance

The high-end watch maker, Movado Group MOV announced its results for the first quarter of fiscal year 2015 before the market open on Thursday.

The company reported $0.29 and a miss of $0.03 on diluted per share earnings compared to consensus estimates. Additionally, Movado missed on revenues, which were $120.9 million versus consensus estimates of $122.28 million.

Movado CEO Efraim Grinberg commented,"We began the year with solid first quarter results, highlighted by a nearly 10 percent increase in sales and a 9.2 percent increase in operating income in our smallest quarter of the year.

"We remain excited about the year ahead and believe the first quarter positions us for a strong fiscal 2015. This is further evidenced by the reiteration of our annual guidance and we believe we remain on track to achieve our multi-year strategic plan."

Results Highlights

• Gross Margin was $65.2 million (53.9 percent of sales) a 0.06 percent decline year-over-year. This decline was planned and is attributed to currency exchange and channel and product mix.
• Operating income increased 9.2 percent year-over year to $10.9.
• Net income was $7.4 million.
• Net sales increased 9.9 percent year-over-year to $120.

2015 Guidance

• Movado reiterated fiscal year 2015 guidance on a comparable basis to non-GAAP fiscal 2014.
• Net sales expected to increase 10.7 percent to $640 million.
• Gross margin expected to be "approximately flat"
• Operating income expected to increase 19 percent to 90 million.
• Expected net income of $63.5 million or $2.44 per diluted share.
• Effective tax rate anticipated to be 28 percent.

In addition to its earnings results, Movado announced a cash dividend of $0.10 per share for its common stock and class A common stock holders on record at the close of business on June 2nd, 2014 to be paid June 16, 2014.

The company will be hosting a live webcast of the first quarter FY2015 earnings conference call at 9:00am (ET) on its Investor relations page.