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

Mar 29, 2018 • 09:00 am ET


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


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Efraim Grinberg

Now, I'd like to share with you some of the highlights on the results of our brands from fiscal 2018, and some of our initiatives for this year. As previously announced with our third quarter results, we have made the decision to no longer attend the Baselworld trade fair. Savings from this decision are being reinvested in a more personal venue to communicate and showcase our products to our wholesale customers, and in consumer facing initiatives to help drive growth in a quickly evolving marketplace, including the establishment of a digital center of excellence to expand Movado Group's digital resources.

To this end, I've just returned from our first Movado Group summit that was held in Davos, Switzerland, and it was attended by many of our distributors, licensing partners and wholesale customers from around the world. At Davos, we previewed our growth strategies for the coming year for our brand, as well as our new product introductions with our customers in a more intimate and personal setting. We also featured an excellent speaker on the evolving social media landscape, and a digital panel with a high level of engagement from our customers.

Turning to sales of our largest brand, Movado. While our Movado sales were down mid-single digits for the quarter, as certain of our wholesale channels in the United States remain challenging, the brand performed well at retail, recording double-digit sell-through increases across our department store and specialty store channels for the holiday season. We also saw continue -- we also continue to see strong performance driven by our digital initiatives and product units. Highlights of some of the strong performers for the holiday season were our Museum Bauhaus collection introduced to honor the 70th anniversary of our iconic Museum dial design, our bold men's bracelet watches, and Movado Connect, our first Google-powered smartwatch.

For the quarter and the year, we saw our sales grow by 53% and 47%, respectively. While still a relatively modest portion of our overall sales, we are encouraged by this strong performance. Our mall-based chain store in the US remained challenging as the leading retailers in this arena continued to adapt to a more digitally focused environment. This spring, we are looking forward to increasing our engagement digitally with consumers.

A few years ago, we announced the establishment -- a few weeks ago, we announced the establishment of a digital center of excellence, and the appointment of a chief digital officer for the Company, as well as a vice president of social media. These two key hires reflect the emphasis that we are planning on e-commerce and digital communication. We expect our Movado brand and entire portfolio to benefit from our increased focus on our digital platform as our omni-channel business remains a priority for us, as well as our wholesale business partners around the world.

For the year we saw strong growth of our Movado brand in China, and we'll continue to make investments in developing our team in that region to