Movado Group this morning reported a “strong” start to the year, with sales and earnings surpassing management’s expectations following a solid first quarter.
Q1 net sales, for the three months to April 30, increased 28% to $127.1m, or 22.2% on a constant dollar basis.
Operating income grew to $8.9m versus $2.7m in the prior year as the business praised its “powerful” portfolio, which now includes the UK-based Olivia Burton brand that it bought last summer.
Efraim Grinberg, chairman and CEO of Movado (pictured), stated: “We are very pleased to report a strong start to the year with sales and earnings surpassing our expectations. Sales grew 22% in constant currency fueled by our powerful portfolio of owned and licensed brands, including the addition of Olivia Burton, which was acquired in July 2017. Our first quarter results reflect the team’s consistent ability to bring innovation to market that resonates with consumers around the world, which was further enhanced by the execution of our strategic growth priorities.”
Mr Grinberg said the group saw sales strengthen across regions and channels, generating strong results in its international markets as well as its outlet stores and e-commerce business. This top line momentum, combined with gross margin expansion allowed the company to achieve an increase in adjusted operating income of over 200%.
“We delivered these results while continuing to invest in our strategic growth initiatives including an increase in digital marketing and beginning to build out our digital center of excellence. Given our strong first quarter performance, we are raising our outlook for the year.”
The company is raising its outlook for fiscal 2019 as a result of the strong Q1 performance. It now anticipates that net sales will be in a range of $615m to $625m and operating income will be approximately $71m to $73m.