Movado Group, Inc. (NYSE:MOV) Q4 2018 Earnings Conference Call Transcript

Mar 29, 2018 • 09:00 am ET

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Movado Group, Inc. (NYSE:MOV) Q4 2018 Earnings Conference Call Transcript

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Presentation
Operator
Operator

Good day, everyone, and welcome to the Movado Group Fiscal Fourth Quarter 2018 Earnings Call. As a reminder, today's call is being recorded and may not be reproduced in whole or in part without permission from the Company.

At this time, I would like to turn the conference over to Rachel Schacter of ICR. Please go ahead.

Executive
Rachel Schacter

Thank you. Good morning, everyone. With me on the call is Efraim Grinberg, Chairman and Chief Executive Officer; and Sallie DeMarsilis, Chief Financial Officer. Before we get started, I would like to remind you of the Company's Safe Harbor language, which I am sure you're all familiar with.

The statements contained in this conference call, which are not historical facts maybe deemed to constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual future results may differ materially from those suggested in such statements due to a number of risk and uncertainties, all of which are described in the Company's filings with the SEC which includes today's press release. If any non-GAAP financial measure is used on this call or presentation of the most directly comparable GAAP financial measure to this non-GAAP financial measure will be provided as supplemental financial information in our press release.

Now, I would like to turn the call over to Efraim Grinberg, Chairman and Chief Executive Officer of Movado Group.

Executive
Efraim Grinberg

Good morning and welcome to Movado Group's fourth quarter conference call. I will first share with you some of the highlights of our quarter and then Sallie will review our financial performance for the year. After that, we'd be glad to answer your questions.

Fiscal 2018 was an important year for Movado Group, where we gained market share, returned to growth on both the top and bottom line, completed an important and exciting acquisition with the purchase of the Olivia Burton brand, and began to make significant progress in transforming ourselves into a consumer driven omni-channel organization. We finished the year with a very strong fourth quarter that was reflective of the progress that we made.

For the fourth quarter, our sales grew by 14.1% to $149.2 million, and adjusted operating profit almost doubled to $14.4 million. For the year, our revenues grew by 2.8% to $568 million. Adjusted operating profit increased by 14% to $63.6 million. Our adjusted earnings per share were $0.52 for the quarter and $2 for the year. Following the enactment of the Tax Cuts and Jobs Act, we have now provided for the tax impact on overseas earnings. The cash portion of the charge equals $28.2 million, and is payable over eight years. Due to our positive result and the ability under the new tax law to repatriate overseas earnings without further US tax consequences, we have made the decision to increase our quarterly dividend to $0.20. We also moved forward with an ongoing tax rate that is expected to be lower given tax reform. Sallie will spend some time discussing the 2017 tax act in her comments.