Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Jan. 31, 2018 | Mar. 22, 2018 | Jul. 31, 2017 | |
Document Type | 10-K | ||
Amendment Flag | false | ||
Entity Filer Category | Accelerated Filer | ||
Document Period End Date | Jan. 31, 2018 | ||
Document Fiscal Year Focus | 2,018 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | MOV | ||
Entity Registrant Name | MOVADO GROUP INC | ||
Entity Central Index Key | 72,573 | ||
Current Fiscal Year End Date | --01-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Public Float | $ 376,151,000 | ||
Common Stock Class Undefined | |||
Entity Common Stock, Shares Outstanding | 16,297,240 | ||
Class A Common Stock | |||
Entity Common Stock, Shares Outstanding | 6,641,950 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | |||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | ||
Income Statement [Abstract] | ||||
Net sales | [1] | $ 567,953 | $ 552,752 | $ 594,923 |
Cost of sales | 269,875 | 257,935 | 277,993 | |
Gross profit | 298,078 | 294,817 | 316,930 | |
Selling, general, and administrative | 254,878 | 240,836 | 246,823 | |
Operating income | [2],[3],[4],[5],[6],[7] | 43,200 | 53,981 | 70,107 |
Other expense (Note 6) | (1,282) | |||
Interest expense | (1,510) | (1,464) | (1,109) | |
Interest income | 452 | 219 | 127 | |
Income before income taxes | 42,142 | 51,454 | 69,125 | |
Provision for income taxes (Note 7) | 57,367 | 16,315 | 23,360 | |
Net (loss) / income | (15,225) | 35,139 | 45,765 | |
Less: Net income attributed to noncontrolling interests | 78 | 671 | ||
Net (loss) / income attributed to Movado Group, Inc. | $ (15,225) | $ 35,061 | $ 45,094 | |
Basic income per share: | ||||
Weighted basic average shares outstanding | 23,073 | 23,070 | 23,525 | |
Net (loss) / income per share attributed to Movado Group, Inc. | $ (0.66) | $ 1.52 | $ 1.92 | |
Diluted income per share: | ||||
Weighted diluted average shares outstanding | 23,073 | 23,267 | 23,774 | |
Net (loss) / income per share attributed to Movado Group, Inc. | $ (0.66) | $ 1.51 | $ 1.90 | |
Dividends paid per share | $ 0.52 | $ 0.52 | $ 0.44 | |
[1] | The United States and International net sales are net of intercompany sales of $268.1 million, $289.2 million and $309.1 million for the fiscal years ended January 31, 2018, 2017 and 2016, respectively. | |||
[2] | Fiscal 2016 Wholesale and United States and International operating income included a $4.0 million charge as a result of actions taken by the Company in fiscal 2016 to achieve greater operating efficiencies and streamline its operations. | |||
[3] | Fiscal 2017 Wholesale and United States operating income included a pre-tax charge of $1.8 million, as a result of the immediate vesting of stock awards and certain other compensation related to the announcement of the retirement of the Company’s former Vice Chairman and Chief Operating Officer, in fiscal 2017. | |||
[4] | Fiscal 2018 Wholesale and United States and International operating (loss) / income included a charge of $13.6 million as part of the Company’s cost savings initiatives. In fiscal 2018, the Company took actions to better align its global infrastructure with the current business environment by consolidating certain operations and streamlining functions to reduce costs and improve profitability. Also, in light of the changing retail landscape and the growing importance of digital marketing and online sales, the Company decided to cease its participation in the Baselworld Watch and Jewelry Show. | |||
[5] | Fiscal 2018 Wholesale and United States and International operating (loss) / income included a charge of $6.8 million related to transaction charges and the amortization of acquisition accounting adjustments associated with the purchase of the Olivia Burton brand. | |||
[6] | The International operating income included $41.5 million, $40.0 million and $44.5 million of certain intercompany profits related to the Company’s supply chain operations for the fiscal years ended January 31, 2018, 2017 and 2016, respectively. | |||
[7] | The United States operating income included $25.2 million, $26.3 million and $27.0 million of unallocated corporate expenses for the fiscal years ended January 31, 2018, 2017 and 2016, respectively. |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |||
Comprehensive income, net of taxes: | |||||
Net (loss) / income including noncontrolling interests | $ (15,225) | $ 35,139 | $ 45,765 | ||
Other comprehensive income / (loss) | |||||
Net unrealized (loss) / gain on investments, net of tax (benefit) of $(13), $30 and $(15), respectively | (6) | [1] | 8 | (22) | |
Net change in effective portion of hedging contracts, net of tax (benefit) of $(9), $(10) and $10, respectively | (52) | (37) | 50 | ||
Foreign currency translation adjustments | [2] | 23,621 | 8,280 | (30,314) | |
Total other comprehensive income / (loss), net of taxes | 23,563 | 8,251 | (30,286) | ||
Comprehensive income including noncontrolling interests | 8,338 | 43,390 | 15,479 | ||
Less: Comprehensive income attributed to noncontrolling interests | 54 | 734 | |||
Total comprehensive income attributed to Movado Group, Inc. | $ 8,338 | $ 43,336 | $ 14,745 | ||
[1] | Includes approximately twenty-one thousand dollars related to the tax effect of the tax rate change on marketable securities as a result of the early adoption of ASU 2018-02, “Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income” (see Note 7 – Income Taxes). | ||||
[2] | The currency translation adjustment is not adjusted for income taxes to the extent that it relates to permanent investments of earnings in international subsidiaries. |
CONSOLIDATED STATEMENTS OF COM4
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (PARENTHETICAL) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Statement Of Income And Comprehensive Income [Abstract] | |||
Net unrealized (loss) / gain on investments, tax (benefit) | $ (13) | $ 30 | $ (15) |
Net change in effective portion of hedging contracts, tax (benefit) | (9) | $ (10) | $ 10 |
Tax effect of tax rate change on marketable securities | $ 21 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Jan. 31, 2018 | Jan. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 214,811,000 | $ 256,279,000 |
Trade receivables, net | 83,098,000 | 66,847,000 |
Inventories | 151,676,000 | 153,167,000 |
Other current assets | 32,015,000 | 28,487,000 |
Total current assets | 481,600,000 | 504,780,000 |
Property, plant and equipment, net | 24,671,000 | 34,173,000 |
Deferred and non-current income taxes | 6,443,000 | 24,837,000 |
Goodwill | 60,269,000 | 0 |
Other intangibles, net | 23,124,000 | 1,633,000 |
Other non-current assets | 49,273,000 | 42,379,000 |
Total assets | 645,380,000 | 607,802,000 |
Current liabilities: | ||
Loans payable to bank, current | 25,000,000 | 5,000,000 |
Accounts payable | 24,364,000 | 27,192,000 |
Accrued liabilities | 32,814,000 | 28,241,000 |
Accrued payroll and benefits | 15,129,000 | 6,820,000 |
Income taxes payable | 2,989,000 | 4,149,000 |
Total current liabilities | 100,296,000 | 71,402,000 |
Loans payable to bank | 25,000,000 | |
Deferred and non-current income taxes payable | 33,063,000 | 3,322,000 |
Other non-current liabilities | 41,686,000 | 34,085,000 |
Total liabilities | 175,045,000 | 133,809,000 |
Commitments and contingencies (Note 9) | ||
Equity: | ||
Preferred Stock, $0.01 par value, 5,000,000 shares authorized; no shares issued | ||
Capital in excess of par value | 189,808,000 | 185,354,000 |
Retained earnings | 388,739,000 | 415,919,000 |
Accumulated other comprehensive income | 100,343,000 | 76,780,000 |
Treasury Stock, 11,046,671 and 10,869,321 shares, respectively, at cost | (208,894,000) | (204,398,000) |
Total Movado Group, Inc. shareholders' equity | 470,335,000 | 473,993,000 |
Total liabilities and equity | 645,380,000 | 607,802,000 |
Common Stock Class Undefined | ||
Equity: | ||
Common Stock | 273,000 | 272,000 |
Class A Common Stock | ||
Equity: | ||
Common Stock | $ 66,000 | $ 66,000 |
CONSOLIDATED BALANCE SHEETS (PA
CONSOLIDATED BALANCE SHEETS (PARENTHETICAL) - $ / shares | Jan. 31, 2018 | Jan. 31, 2017 |
Preferred Stock, par value | $ 0.01 | $ 0.01 |
Preferred Stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred Stock, shares issued | 0 | 0 |
Treasury Stock, shares | 11,046,671 | 10,869,321 |
Common Stock Class Undefined | ||
Common Stock, par value | $ 0.01 | $ 0.01 |
Common Stock, shares authorized | 100,000,000 | 100,000,000 |
Common Stock, shares issued | 27,342,802 | 27,176,656 |
Common Stock, shares outstanding | 27,342,802 | 27,176,656 |
Class A Common Stock | ||
Common Stock, par value | $ 0.01 | $ 0.01 |
Common Stock, shares authorized | 30,000,000 | 30,000,000 |
Common Stock, shares issued | 6,641,950 | 6,644,105 |
Common Stock, shares outstanding | 6,641,950 | 6,644,105 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Cash flows from operating activities: | |||
Net (loss) / income | $ (15,225) | $ 35,139 | $ 45,765 |
Adjustments to reconcile net (loss) / income to net cash provided by operating activities: | |||
Depreciation and amortization | 13,457 | 11,507 | 13,156 |
Write-down of inventories | 3,792 | 2,757 | 3,108 |
Transactional (gains) / losses | (1,011) | 2,041 | (2,388) |
Deferred income taxes | 461 | (3,753) | (1,817) |
Stock-based compensation | 4,874 | 7,281 | 6,123 |
Impairment of long-term investment | 1,282 | ||
Operating efficiency initiatives and other items | 3,996 | ||
Loss on disposal of fixed assets | 310 | ||
Cost savings initiatives | 13,587 | ||
Charge for 2017 tax act | 45,002 | ||
Changes in assets and liabilities: | |||
Trade receivables | (9,286) | 2,878 | (354) |
Inventories | 6,624 | 7,442 | (3,133) |
Other current assets | (3,824) | 512 | 2,808 |
Accounts payable | (4,006) | (401) | 774 |
Accrued liabilities | (416) | 244 | (94) |
Accrued payroll and benefits | 1,672 | (4,227) | 6,035 |
Income taxes payable | (1,898) | (2,479) | (746) |
Other non-current assets | (6,630) | (7,569) | 1,864 |
Other non-current liabilities | 7,551 | 5,499 | (848) |
Net cash provided by operating activities | 54,724 | 58,153 | 74,559 |
Cash flows from investing activities: | |||
Capital expenditures | (5,810) | (5,920) | (8,070) |
Trademarks and other intangibles | (556) | (328) | (650) |
Short-term investment | (152) | ||
Restricted cash deposits | 1,018 | (1,156) | (435) |
Acquisition, net of cash acquired | (78,991) | ||
Net cash (used in) investing activities | (84,339) | (7,556) | (9,155) |
Cash flows from financing activities: | |||
Proceeds from bank borrowings | 3,000 | 50,000 | |
Repayments of bank borrowings | (5,000) | (13,000) | (10,000) |
Stock options exercised and other changes | (159) | (296) | (25) |
Stock repurchase | (3,631) | (3,864) | (48,748) |
Purchase of incremental ownership of joint venture | (162) | (1,320) | (4,267) |
Debt issuance cost | (339) | ||
Dividends paid | (11,934) | (11,930) | (10,312) |
Net cash (used in) financing activities | (20,886) | (27,410) | (23,691) |
Effect of exchange rate changes on cash and cash equivalents | 9,033 | 4,904 | (13,377) |
Net (decrease) / increase in cash and cash equivalents | (41,468) | 28,091 | 28,336 |
Cash and cash equivalents at beginning of year | 256,279 | 228,188 | 199,852 |
Cash and cash equivalents at end of year | $ 214,811 | $ 256,279 | $ 228,188 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($) $ in Thousands | Total | Common Stock Class Undefined | [1] | Class A Common Stock | [2] | Capital in Excess of Par Value | Retained Earnings | Accumulated Other Comprehensive Income | Treasury Stock | Noncontrolling Interests | |||
Beginning Balance at Jan. 31, 2015 | $ 484,285 | $ 268 | $ 66 | $ 174,826 | $ 358,006 | $ 98,854 | $ (149,811) | $ 2,076 | |||||
Net (loss) / income | 45,765 | 45,094 | 671 | ||||||||||
Dividends | (10,312) | (10,312) | |||||||||||
Stock options exercised, net of tax | (56) | 2 | 578 | (636) | |||||||||
Joint venture incremental share purchase | (5,828) | (3,613) | (2,215) | ||||||||||
Stock repurchase | (48,748) | (48,748) | |||||||||||
Supplemental executive retirement plan | 204 | 204 | |||||||||||
Stock-based compensation expense | 6,123 | 6,123 | |||||||||||
Net unrealized gain (loss) on investments, net of tax benefit | (22) | (22) | |||||||||||
Net change in effective portion of hedging contracts, net of tax benefit | 50 | 50 | |||||||||||
Foreign currency translation adjustment | [3] | (30,314) | (30,377) | 63 | |||||||||
Ending Balance at Jan. 31, 2016 | 441,147 | 270 | 66 | 178,118 | 392,788 | 68,505 | (199,195) | 595 | |||||
Net (loss) / income | 35,139 | 35,061 | 78 | ||||||||||
Dividends | (11,930) | (11,930) | |||||||||||
Stock options exercised, net of tax | (561) | 2 | 776 | (1,339) | |||||||||
Joint venture incremental share purchase | (1,660) | (1,011) | (649) | ||||||||||
Stock repurchase | (3,864) | (3,864) | |||||||||||
Supplemental executive retirement plan | 190 | 190 | |||||||||||
Stock-based compensation expense | 7,281 | 7,281 | |||||||||||
Net unrealized gain (loss) on investments, net of tax benefit | 8 | 8 | |||||||||||
Net change in effective portion of hedging contracts, net of tax benefit | (37) | (37) | |||||||||||
Foreign currency translation adjustment | [3] | 8,280 | 8,304 | $ (24) | |||||||||
Ending Balance at Jan. 31, 2017 | 473,993 | 272 | 66 | 185,354 | 415,919 | 76,780 | (204,398) | ||||||
Net (loss) / income | (15,225) | (15,225) | |||||||||||
Dividends | (11,934) | (11,934) | |||||||||||
Tax effect of rate change on marketable securities | 21 | (21) | [4] | 21 | [4] | ||||||||
Stock options exercised | (159) | 1 | 705 | (865) | |||||||||
Stock repurchase | (3,631) | (3,631) | |||||||||||
Supplemental executive retirement plan | 124 | 124 | |||||||||||
Stock-based compensation expense | [5] | 3,625 | 3,625 | ||||||||||
Net unrealized gain (loss) on investments, net of tax benefit | (27) | (27) | |||||||||||
Net change in effective portion of hedging contracts, net of tax benefit | (52) | (52) | |||||||||||
Foreign currency translation adjustment | [3] | 23,621 | 23,621 | ||||||||||
Ending Balance at Jan. 31, 2018 | $ 470,335 | $ 273 | $ 66 | $ 189,808 | $ 388,739 | $ 100,343 | $ (208,894) | ||||||
[1] | Each share of common stock is entitled to one vote per share on all matters submitted to a vote of the shareholders. | ||||||||||||
[2] | Each share of class A common stock is entitled to 10 votes per share on all matters submitted to a vote of the shareholders. Each holder of class A common stock is entitled to convert, at any time, any and all of such shares into the same number of shares of common stock. Each share of class A common stock is converted automatically into common stock in the event that the beneficial or record ownership of such shares of class A common stock is transferred to any person, except to certain family members or affiliated persons deemed “permitted transferees” pursuant to the Company’s Restated Certificate of Incorporation as amended. The class A common stock is not publicly traded and consequently, there is currently no established public trading market for these shares. | ||||||||||||
[3] | The currency translation adjustment is not adjusted for income taxes to the extent that it relates to permanent investments of earnings in international subsidiaries. | ||||||||||||
[4] | Due to the early adoption of ASU 2018-02 (see Note 18 – Accounting Changes and Recent Accounting Pronouncements). | ||||||||||||
[5] | Stock-based compensation expense includes $1.2 million related to the Company’s cost savings initiatives. |
CONSOLIDATED STATEMENTS OF CHA9
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (PARENTHETICAL) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Dividends per share | $ 0.52 | $ 0.52 | $ 0.44 |
Stock options exercised, tax expense | $ 265 | $ 31 | |
Net unrealized gain (loss) on investments, tax (benefit) | $ (13) | 30 | (15) |
Net change in effective portion of hedging contracts, tax (benefit) | (9) | (10) | 10 |
Stock-based compensation | 4,874 | $ 7,281 | $ 6,123 |
Cost Savings Initiatives | |||
Stock-based compensation | $ 1,200 | ||
Common Stock Class Undefined | |||
Common Stock, Voting Rights | Each share of common stock is entitled to one vote per share on all matters submitted to a vote of the shareholders. | ||
Class A Common Stock | |||
Common Stock, Voting Rights | Each share of class A common stock is entitled to 10 votes per share on all matters submitted to a vote of the shareholders. | ||
Common stock, Conversion basis | Each share of class A common stock is entitled to 10 votes per share on all matters submitted to a vote of the shareholders. Each holder of class A common stock is entitled to convert, at any time, any and all of such shares into the same number of shares of common stock. Each share of class A common stock is converted automatically into common stock in the event that the beneficial or record ownership of such shares of class A common stock is transferred to any person, except to certain family members or affiliated persons deemed “permitted transferees” pursuant to the Company’s Restated Certificate of Incorporation as amended. |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Jan. 31, 2018 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES Organization and Business Movado Group, Inc. (together with its subsidiaries, the “Company”) designs, sources, markets and distributes quality watches with prominent brands in almost every price category comprising the watch industry. In fiscal 2018, the Company marketed the following distinct brands of watches: Coach, Concord, Ebel, Scuderia Ferrari, HUGO BOSS, Juicy Couture, Lacoste, Movado, Olivia Burton, Rebecca Minkoff/Uri Minkoff and Tommy Hilfiger. Movado (with the exception of certain Movado collections, including Movado BOLD), Ebel and Concord watches are manufactured in Switzerland by independent third party assemblers and are manufactured using Swiss movements. All of the Company’s products are manufactured using components obtained from third party suppliers. Certain Movado collections of watches, including Movado BOLD, are manufactured by independent contractors in Asia using Swiss movements. Coach, Tommy Hilfiger, HUGO BOSS, Juicy Couture, Lacoste, Olivia Burton, Scuderia Ferrari and Rebecca Minkoff and Uri Minkoff watches are manufactured by independent contractors in Asia. In addition to its sales to trade customers and independent distributors, the Company sells directly to consumers via its e-commerce platforms and also operates retail outlet locations throughout the United States, through which it sells current and discontinued models and factory seconds of all of the Company’s watches. Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. Intercompany transactions and balances have been eliminated. Use of Estimates in the Preparation of Financial Statements The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. The Company uses estimates when accounting for sales discounts, returns, allowances and incentives, warranties, income taxes, depreciation, amortization, inventory write-downs, stock-based compensation, contingencies, impairments and asset and liability valuations. Translation of Foreign Currency Financial Statements and Foreign Currency Transactions The financial statements of the Company’s international subsidiaries have been translated into United States dollars by translating balance sheet accounts at year-end exchange rates and statement of operations accounts at average exchange rates for the year. Foreign currency transaction gains and losses are charged or credited to earnings as incurred. Foreign currency translation gains and losses are reflected in the equity section of the Company’s consolidated balance sheets in Accumulated Other Comprehensive Income. The balance of the foreign currency translation adjustment, included in Accumulated Other Comprehensive Income, was $100.2 million and $76.6 million as of January 31, 2018 and 2017, respectively. Cash and Cash Equivalents Cash equivalents include all highly liquid investments with original maturities at date of purchase of three months or less. Trade Receivables Trade receivables as shown on the consolidated balance sheets are net of various allowances. The allowance for doubtful accounts is determined through an analysis of the aging of accounts receivable, assessments of collectability based on historical trends, the financial condition of the Company’s customers and an evaluation of economic conditions. The Company writes off uncollectible trade receivables once collection efforts have been exhausted and third parties confirm the balance is not recoverable. The Company’s trade customers include department stores, jewelry store chains and independent jewelers. All of the Company’s watch brands are also marketed outside the U.S. through a network of independent distributors. Accounts receivable are stated net of doubtful accounts, returns and allowances of $21.6 million, $18.9 million and $17.7 million at January 31, 2018, 2017 and 2016, respectively. Additionally, $2.3 million, $2.2 million and $1.6 million of receivables and allowances were recorded in non-current assets as of January 31, 2018, 2017 and 2016, respectively. Accounts receivable are also stated net of co-operative advertising allowances of $9.4 million, $7.8 million, and $9.8 million at January 31, 2018, 2017, and 2016, respectively. Co-operative advertising allowances are credits taken by the customer at a future date on previously executed co-operative advertising. The Company’s concentrations of credit risk arise primarily from accounts receivable related to trade customers during the peak selling seasons. The Company has significant accounts receivable balances due from major national chain and department stores. The Company’s results of operations could be materially adversely affected in the event any of these customers or a group of these customers defaulted on all or a significant portion of their obligations to the Company as a result of financial difficulties. As of January 31, 2018, except for those accounts provided for in the allowance for doubtful accounts, the Company knew of no situations with any of the Company’s major customers which would indicate any such customer’s inability to make its required payments. Inventories The Company values its inventory at the lower of cost or net realizable value. Cost is determined using the average cost method. The Company performs reviews of its on-hand inventory to determine amounts, if any, of inventory that is deemed discontinued, excess, or unsaleable. Inventory classified as discontinued, together with the related component parts which can be assembled into saleable finished goods, is sold primarily through the Company’s outlet stores. When management determines that finished product is unsaleable, could not be sold at net realizable value or that it is economically impractical to build the excess components into watches for sale, a charge is recorded to value those products and components at the lower of cost or net realizable value. Property, Plant and Equipment Property, plant and equipment are stated at cost less accumulated depreciation. Depreciation of buildings is provided using the straight-line method based on the useful life of 40 years. Depreciation of furniture and equipment is provided using the straight-line method based on the estimated useful lives of assets, which range from four to ten years. Computer software is amortized using the straight-line method over the useful life of five to ten years. Leasehold improvements are amortized using the straight-line method over the lesser of the term of the lease or the estimated useful life of the leasehold improvement. Design fees and tooling costs are amortized using the straight-line method based on the useful life of three years. Upon the disposition of property, plant and equipment, the accumulated depreciation is deducted from the original cost and any gain or loss is reflected in operating income. Intangibles In accordance with applicable guidance, the Company estimates and records the fair value of purchased intangible assets at the time of their acquisition. The fair values of these intangible assets are estimated based on independent third-party appraisals. Finite-lived intangible assets are amortized over their respective estimated useful lives and are evaluated for impairment periodically and whenever events or changes in circumstances indicate that their related carrying values may not be fully recoverable. Estimates of fair value for finite-lived intangible assets are primarily determined using discounted cash flow analysis of such assets, with consideration of market comparisons and recent transactions. This approach uses significant estimates and assumptions, including projected future cash flows, discount rates and growth rates. Intangible assets consist primarily of a trade name, trademarks and customer relationships and are recorded at cost. These intangible assets are amortized over a range from three to ten years. At January 31, 2018 and 2017, intangible assets at cost were $30.3 million and $8.1 million, respectively, and related accumulated amortization of intangibles was $7.3 million and $6.8 million, respectively. Amortization expense for fiscal 2018, 2017 and 2016 was $2.0 million, $0.4 million and $0.3 million, respectively. Goodwill At the time of an acquisition, in accordance with applicable guidance, the Company records all acquired net assets at their estimated fair values. These estimated fair values are based on management’s assessments and independent third-party appraisals. The excess of the purchase consideration over the aggregate estimated fair values of the acquired net assets is recorded as goodwill. Goodwill is not amortized but is assessed for impairment at least annually on November 1 st The quantitative impairment test is performed to measure the amount of impairment loss, if any. The quantitative impairment test identifies the existence of potential impairment by comparing the fair value of each reporting unit with its carrying value, including goodwill. If a reporting unit’s carrying amount exceeds its fair value, the Company will record an impairment charge, as an operating expense item, based on that difference. The impairment charge will be limited to the amount of goodwill allocated to that reporting unit. Determination of the fair value of a reporting unit and the fair value of individual assets and liabilities of a reporting unit is based on management’s assessment, including the consideration of independent third-party appraisals when necessary. Furthermore, this determination is subjective in nature and involves the use of significant estimates and assumptions. These estimates and assumptions could have a significant impact on whether or not an impairment charge is recognized and the amount of any such charge. Estimates of fair value are primarily determined using discounted cash flows, market comparisons, and recent transactions. These approaches use significant estimates and assumptions, including projected future cash flows, discount rates, growth rates, and determination of appropriate market comparisons. At November 1, 2017, the Company evaluated goodwill for impairment. There were no indicators of impairment under this analysis and, accordingly, no impairment charge was recorded in fiscal 2018. The Company had no goodwill in fiscal 2017. Long-Lived Assets The Company periodically reviews the estimated useful lives of its property, plant and equipment and intangible assets based on factors including historical experience, the expected beneficial service period of the asset, the quality and durability of the asset and the Company’s maintenance policy including periodic upgrades. Changes in useful lives are made on a prospective basis unless factors indicate the carrying amounts of the assets may not be recoverable and an impairment write-down is necessary. The Company performs an impairment review of its long-lived assets once events or changes in circumstances indicate, in management’s judgment, that the carrying value of such assets may not be recoverable. When such a determination has been made, management compares the carrying value of the asset groups with their estimated future undiscounted cash flows. If it is determined that an impairment has occurred, the fair value of the asset group is determined and compared to its carrying value. The excess of the carrying value over the fair value, if any, is recognized as loss during that period. The impairment is calculated as the difference between asset carrying values and the fair value of the long-lived assets. Deferred Rent Obligations and Contributions from Landlords The Company accounts for rent expense under non-cancelable operating leases with scheduled rent increases on a straight-line basis over the lease term. The excess of straight-line rent expense over scheduled payments is recorded as a deferred liability in accrued liabilities and other non-current liabilities. In addition, the Company receives build out contributions from landlords primarily as an incentive for the Company to lease retail store space from the landlords. This is also recorded as a deferred liability in accrued liabilities and other non-current liabilities. Such amounts are amortized as a reduction of rent expense over the life of the related lease. Capitalized Software Costs The Company capitalizes certain computer software costs after technological feasibility has been established. The costs are amortized utilizing the straight-line method over the economic lives of the related products ranging from two to ten years. Derivative Financial Instruments The Company accounts for its derivative financial instruments in accordance with the accounting guidance which requires that an entity recognize all derivatives as either assets or liabilities in the statement of financial position and measure those instruments at fair value. A significant portion of the Company’s purchases are denominated in Swiss francs and, to a lesser extent, the Japanese Yen. The Company also sells to third-party customers in a variety of foreign currencies, most notably the Euro and the British Pound. The Company reduces its exposure to the Swiss franc, Euro, British Pound and Japanese Yen exchange rate risks through a hedging program. Under the hedging program, the Company manages most of its foreign currency exposures on a consolidated basis, which allows it to net certain exposures and take advantage of natural offsets. In the event these exposures do not offset, from time to time the Company uses forward contracts to further reduce the net exposures to currency fluctuations. Certain of these contracts meet the requirements of qualified hedges. In these circumstances, the Company designates and documents these derivative instruments as a cash flow hedge of a specific underlying exposure, as well as the risk management objectives and strategies for undertaking the hedge transactions. Changes in the fair value of hedges designated and documented as a cash flow hedge and which are highly effective, are recorded in other comprehensive income until the underlying transaction affects earnings, and then are later reclassified into earnings in the same account as the hedged transaction. The earnings impact is mostly offset by the effects of currency movements on the underlying hedged transactions. The Company formally assesses, both at the inception and at each financial quarter thereafter, the effectiveness of the derivative instrument hedging the underlying forecasted cash flow transaction. The Company does not exclude any designated cash flow hedges from its effectiveness testing. Any ineffectiveness related to the derivative financial instruments’ change in fair value will be recognized as other expense in the Consolidated Statements of Operations in the period in which the ineffectiveness was calculated. The Company uses forward exchange contracts, which do not meet the requirements of qualified hedges, to offset its exposure to certain foreign currency receivables and liabilities. These forward contracts are not designated as qualified hedges and, therefore, changes in the fair value of these derivatives are recognized in earnings in the period they arise, thereby offsetting the current earnings effect resulting from the revaluation of the related foreign currency receivables and liabilities. All of the Company’s derivative instruments have liquid markets to assess fair value. The Company does not enter into any derivative instruments for trading purposes. Revenue Recognition In the Wholesale segment, the Company recognizes its revenues upon transfer of title and risk of loss in accordance with its terms of sale and after the sales price is fixed and determinable and collectability is reasonably assured. In the Retail segment, transfer of title and risk of loss occurs at the time of register receipt. The Company records estimates for sales returns, volume-based programs and sales and cash discount allowances as a reduction of revenue in the same period that the sales are recorded. These estimates are based upon historical analysis, customer agreements and/or currently known factors that arise in the normal course of business. While returns have historically been within the Company’s expectations and the provisions established, future return rates may differ from those experienced in the past. Taxes imposed by governmental authorities on the Company's revenue-producing activities with customers, such as sales taxes and value added taxes, are excluded from net sales. The Company’s sale of smart watches contains multiple deliverables. The first deliverable is the watch along with the software essential to the functionality of the watch delivered at the time of sale. The second deliverable is the software included free of charge that enables users to sync and view data on the Company’s mobile app. The third deliverable is the embedded right included with the purchase to receive unspecified firmware and software upgrades, when and if available. The Company allocates revenue to all deliverables using the relative selling price method. Amounts allocated to the delivered smart watch collections and the related essential software are recognized at the time of sale. Amounts allocated to the cloud service and app updates are deferred and recognized on a straight-line basis over the estimated two-year period the updates are expected to be provided. The Company’s smart watch collections were available in limited quantities and in limited distribution, and, as a result, these deferred amounts were immaterial as of January 31, 2018, 2017 and 2016, respectively. Cost of Sales Cost of sales of the Company’s products consist primarily of costs for raw materials, component costs, royalties, depreciation, amortization, assembly costs, design costs and unit overhead costs associated with the Company’s supply chain operations predominately in Switzerland and Asia. The Company’s supply chain operations consist of logistics management of assembly operations and product sourcing predominately in Switzerland and Asia and minor assembly in Switzerland. Selling, General and Administrative (“SG&A”) Expenses The Company’s SG&A expenses consist primarily of marketing, selling, distribution, general and administrative expenses. Marketing expenditures are based principally on overall strategic considerations relative to maintaining or increasing market share in markets that management considers to be crucial to the Company’s continued success as well as on general economic conditions in the various markets around the world in which the Company sells its products. Marketing expenses include salaries, various forms of media advertising, digital advertising and co-operative advertising with customers and distributors and other point of sale marketing and promotion spending. Selling expenses consist primarily of salaries, sales commissions, sales force travel and related expenses, depreciation and amortization, expenses associated with Baselworld Watch and Jewelry Show, the annual watch and jewelry trade show, and other industry trade shows and operating costs incurred in connection with the Company’s retail business. Sales commissions vary with overall sales levels. Retail selling expenses consist primarily of payroll and related expenses and store occupancy costs. Distribution expenses consist primarily of salaries of distribution staff, rental and other occupancy costs, security, depreciation and amortization of furniture and leasehold improvements and shipping supplies. General and administrative expenses consist primarily of salaries and other employee compensation including performance based compensation, employee benefit plan costs, office rent, management information systems costs, professional fees, bad debts, depreciation and amortization of furniture, computer software and leasehold improvements, patent and trademark expenses and various other general corporate expenses. Warranty Costs All watches sold by the Company come with limited warranties covering the movement against defects in material and workmanship for periods ranging from two to three years from the date of purchase, with the exception of Tommy Hilfiger watches, for which the warranty period is ten years. In addition, the warranty period is five years for the gold plating for Movado watch cases and bracelets. When changes in warranty costs are experienced, the Company will adjust the warranty liability as required. The Company records an estimate for future warranty costs based on historical repair costs. Warranty costs have historically been within the Company’s expectations and the provisions established. Warranty liability for the fiscal years ended January 31, 2018, 2017 and 2016 was as follows (in thousands): 2018 2017 2016 Balance, beginning of year $ 2,728 $ 2,556 $ 2,710 Provision charged to operations 2,845 2,092 1,630 Settlements made (2,285 ) (1,920 ) (1,784 ) Balance, end of year $ 3,288 $ 2,728 $ 2,556 Pre-opening Costs Marketing and administrative costs associated with the opening of retail stores are expensed in the period incurred. Marketing The Company expenses the production costs of an advertising campaign at the commencement date of the advertising campaign. Included in marketing expenses are costs associated with co-operative advertising, media advertising, digital advertising, production costs and costs of point of sale materials and displays. These costs are recorded as SG&A expenses. The Company participates in co-operative advertising programs on a voluntary basis and receives a “separately identifiable benefit in exchange for the consideration.” Since the amount of consideration paid to the retailer does not exceed the fair value of the benefit received by the Company, these costs are recorded as SG&A expenses as opposed to being recorded as a reduction of revenue. Marketing expense for fiscal 2018, 2017 and 2016 was $73.1 million, $75.7 million and $77.6 million, respectively. Included in other current assets and non-current assets in the consolidated balance sheets are the costs of certain prepaid advertising, including principally product displays and point of sale materials and to a lesser extent licensing agreements and sponsorships. Prepaid advertising accounted for in other current assets for the years ended January 31, 2018 and 2017, respectively. Prepaid advertising accounted for in other non-current assets for the years ended January 31, 2018 and 2017, respectively. Shipping and Handling Costs Amounts charged to customers for shipping and handling were $1.8 million, $1.9 million and $2.2 million for fiscal years 2018, 2017 and 2016, respectively. The costs related to shipping and handling were $5.2 million, $5.6 million and $6.5 million for fiscal years 2018, 2017 and 2016, respectively. These amounts incurred by the Company related to shipping and handling are included in net sales and cost of goods sold. Collaborative Arrangement The Company participates in a collaborative arrangement with Rebecca Minkoff, LLC relating to the Rebecca Minkoff and Uri Minkoff brand names. Both parties to the arrangement are active participants in the collaboration and are exposed to significant risks and rewards dependent on the commercial success of the activities. The arrangement involves various activities including the design, development, distribution and marketing of watches under the brand names. Amounts due between the parties to the arrangement related to sales and related activities are recorded in the Company’s cost of sales while those amounts related to general and administrative activities are recorded as an adjustment to selling, general and administrative expenses. The Company generated immaterial revenues and incurred immaterial expenses under its collaborative arrangement during fiscal 2018. Income Taxes The Company, under the guidance for Income Taxes (“ASC Topic 740”), follows the asset and liability method of accounting for income taxes under which deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax laws and tax rates, in each jurisdiction where the Company operates, and applied to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities due to a change in tax rates is recognized in income in the period that includes the enactment date. In addition, the amounts of any future tax benefits are reduced by a valuation allowance to the extent such benefits are not expected to be realized on a more-likely-than-not basis. The Company calculates estimated income taxes in each of the jurisdictions in which it operates. This process involves estimating actual current tax expense along with assessing temporary differences resulting from differing treatment of items for both book and tax purposes. The Company follows guidance for accounting for uncertainty in income taxes. This guidance clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold and measurement standard for the financial statement recognition and measurement of an income tax position taken or expected to be taken in a tax return. This guidance also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosures and transitions. The Tax Cuts and Jobs Act (“2017 Tax Act”) that was signed into law on December 22, 2017 constitutes a major change to the US tax system. The 2017 Tax Act significantly changed the existing U.S. corporate income tax laws by, among other things, lowering the corporate tax rate from 35% to 21%, limiting the deductibility of interest expense and executive compensation, implementing a territorial tax system, and imposing a one-time mandatory deemed repatriation transition tax (“Transition Tax”) on cumulative undistributed foreign earnings which have not been previously taxed. The SEC issued Staff Accounting Bulletin No. 118 (“SAB 118”) which allows the Company to record provisional amounts related to the 2017 Tax Act and provides a measurement period of up to one year from the enactment date for companies to complete their accounting under ASC Topic 740. The Company has not completed its full analysis with respect to the Global Intangible Low Taxed Income (“GILTI”) provision within the 2017 Tax Act which would require the current inclusion in federal taxable income of earnings of certain foreign controlled corporations. The Company is not yet able to make reasonable estimates of the tax impact of GILTI; therefore, it has not yet elected a policy as to whether it will recognize deferred taxes for basis differences expected to reverse as GILTI, or whether the Company will account for GILTI as period costs if and when incurred. The Company will continue to evaluate these provisions and elect an accounting policy within the measurement period. The Company early adopted ASU 2018-02, “Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income” which permits companies to reclassify disproportionate tax effects in accumulated other comprehensive income caused by the 2017 Tax Act to retained earnings. As a result, the Company made the election to reclassify the income tax effects of the 2017 Tax Act from AOCI to retained earnings in the current year. The adoption of this standard did not have a material impact on the Company’s consolidated results of operations or financial position. Retail Comparable Stores The Company considers comparable outlet store sales to be sales of stores that were open as of February 1 st st Earnings Per Share The Company presents net income per share on a basic and diluted basis. Basic earnings per share is computed using weighted-average shares outstanding during the period. Diluted earnings per share is computed using the weighted-average number of shares outstanding adjusted for dilutive common stock equivalents. The weighted-average number of shares outstanding for basic earnings per share were approximately 23,073,000, 23,070,000 and 23,525,000 for fiscal 2018, 2017 and 2016, respectively. For the fiscal year ended January 31, 2018, the number of shares outstanding for diluted earnings per share was the same as the basic earnings per share because the Company generated a net loss. For the fiscal years ended January 31, 2017 and 2016, the number of shares outstanding for diluted earnings per share were approximately 23,267,000 and 23,774,000, respectively. For the fiscal years ended January 31, 2017 and 2016, the number of shares outstanding for diluted earnings per share included approximately 197,000 and 249,000 due to potentially dilutive common stock equivalents issuable under the Company’s stock compensation plans. For the fiscal years ended January 31, 2018, 2017 and 2016 approximately 994,000, 785,000 and 637,000, respectively, of potentially dilutive common stock equivalents were excluded from the computation of diluted earnings per share because their effect would have been antidilutive. Stock-Based Compensation Under the accounting guidance for share-based payments, the Company utilizes the Black-Scholes option-pricing model which requires that certain assumptions be made to calculate the fair value of each option at the grant date. The expected life of stock option grants is determined using historical data and represents the time period during which the stock option is expected to be outstanding until it is exercised. The risk free interest rate is the yield on the grant date of U.S. Treasury constant maturities with a maturity date closest to the expected life of the stock option. The expected stock price volatility is derived from historical volatility and calculated based on the estimated term structure of the stock option grant. The expected dividend yield is calculated using the Company’s historical average of annualized dividend yields and applied over the expected term of the option. Compensation expense for equity instruments is accrued based on the estimated number of instruments for which the requisite service is expected to be rendered and expensed on a straight-line basis over the vesting term. |
Inventories
Inventories | 12 Months Ended |
Jan. 31, 2018 | |
Inventory Disclosure [Abstract] | |
Inventories | NOTE 2 – INVENTORIES Inventories consisted of the following (in thousands): As of January 31, 2018 2017 Finished goods $ 112,712 $ 112,297 Component parts 37,404 38,482 Work-in-process 1,560 2,388 $ 151,676 $ 153,167 |
Property, Plant and Equipment
Property, Plant and Equipment | 12 Months Ended |
Jan. 31, 2018 | |
Property Plant And Equipment [Abstract] | |
Property, Plant and Equipment | NOTE 3 – PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment, at cost, consisted of the following (in thousands): As of January 31, 2018 2017 Land and buildings $ 1,610 $ 1,490 Furniture and equipment 48,748 59,163 Computer software 32,359 32,077 Leasehold improvements 32,814 32,307 Design fees and tooling costs 2,398 1,787 117,929 126,824 Less: accumulated depreciation (93,258 ) (92,651 ) $ 24,671 $ 34,173 Depreciation and amortization expense from operations related to property, plant and equipment for fiscal 2018, 2017 and 2016 was $11.8 million, $11.9 million and $12.4 million, respectively, which includes computer software amortization expense for fiscal 2018, 2017 and 2016 of $3.6 million, $3.5 million and $3.5 million, respectively. |
Debt and Lines of Credit
Debt and Lines of Credit | 12 Months Ended |
Jan. 31, 2018 | |
Debt Disclosure [Abstract] | |
Debt and Lines of Credit | NOTE 4 – DEBT AND LINES OF CREDIT On January 30, 2015, the Company, together with Movado Group Delaware Holdings Corporation, Movado Retail Group, Inc. and Movado LLC (collectively, the “Borrowers”), each a wholly-owned domestic subsidiary of the Company, entered into a Credit Agreement (the “Credit Agreement”) with the lenders party thereto and Bank of America, N.A. as administrative agent (in such capacity, the “Agent”). The Credit Agreement provides for a $100.0 million senior secured revolving credit facility (the “Facility”), including a $15.0 million letter of credit sub-facility, that matures on January 30, 2020, with provisions for uncommitted increases of up to $50.0 million in the aggregate, subject to customary terms and conditions. In connection with the Credit Agreement, the Borrowers also entered into a Security and Pledge Agreement dated as of January 30, 2015 in favor of the Agent (the “Security Agreement”). As of January 31, 2018, $25.0 million in loans were drawn under the Facility. Additionally, approximately $0.3 million in letters of credit, which were outstanding under the Borrower’s pre-existing asset-based revolving credit facility that was concurrently terminated when the Credit Agreement became effective, are deemed to be issued and outstanding under the Facility. As of January 31, 2018, availability under the Facility was approximately $74.7 million. As of January 31, 2018, the Company classified all of the outstanding balance under the Facility as current, based on voluntary payments expected to be made in the next twelve months. As of February 28, 2018, the Company repaid all $25.0 million of its outstanding debt. Borrowings under the Facility bear interest at rates selected periodically by the Company at LIBOR plus a spread ranging from 1.25% to 1.75% per annum, based on the Company’s consolidated leverage ratio or at a base rate plus a spread ranging from 0.25% to 0.75% per annum based on the Company’s consolidated leverage ratio (as defined in the Credit Agreement). At January 31, 2018, the Company’s spreads were 1.25% over LIBOR and 0.25% over the base rate. The Company has also agreed to pay certain fees and expenses and provide certain indemnities, all of which are customary for such financings. The borrowings under the Facility are joint and several obligations of the Borrowers and are also cross-guaranteed by each Borrower. In addition, pursuant to the Security Agreement, the Borrowers’ obligations under the Facility are secured by first priority liens, subject to permitted liens, on substantially all of the Borrowers’ assets other than certain excluded assets. The Security Agreement contains representations, warranties and covenants, which are customary for pledge and security agreements of this type, relating to the creation and perfection of security interests in favor of the Agent over various categories of the Borrowers’ assets. The Credit Agreement contains affirmative and negative covenants binding on the Borrowers and their subsidiaries that are customary for credit facilities of this type, including, but not limited to, restrictions and limitations on the incurrence of debt and liens, dispositions of assets, capital expenditures, dividends and other payments in respect of equity interests, the making of loans and equity investments, mergers, consolidations, liquidations and dissolutions, and transactions with affiliates (in each case, subject to various exceptions). The Borrowers are also subject to a minimum consolidated EBITDA (as defined in the Credit Agreement) test of $50.0 million, measured at the end of each fiscal quarter based on the four most recent fiscal quarters and a consolidated leverage ratio (as defined in the Credit Agreement) covenant not to exceed 2.50 to 1.00, measured as of the last day of each fiscal quarter. As of January 31, 2018, the Company was in compliance with its covenants under the Credit Agreement. The Credit Agreement contains events of default that are customary for facilities of this type, including, but not limited to, nonpayment of principal, interest, fees and other amounts when due, failure of any representation or warranty to be true in any material respect when made or deemed made, violation of covenants, cross default with material indebtedness, material judgments, material ERISA liability, bankruptcy events, asserted or actual revocation or invalidity of the loan documents, and change of control. As of January 31, 2018, Bank of America, N.A. issued two irrevocable standby letters of credit in connection with retail and operating facility leases to various landlords and for Canadian payroll to the Royal Bank of Canada. As of January 31, 2018, the Company had outstanding letters of credit totaling $0.3 million with expiration dates through May 31, 2018. A Swiss subsidiary of the Company maintains unsecured lines of credit with an unspecified maturity with a Swiss bank. As of January 31, 2018 and 2017, these lines of credit totaled 6.5 million Swiss francs and 6.5 million Swiss francs with a dollar equivalent of $7.0 million and $6.6 million, respectively. As of January 31, 2018 and 2017, there were no borrowings against these lines. As of January 31, 2018, two European banks have guaranteed obligations to third parties on behalf of two of the Company’s foreign subsidiaries in the dollar equivalent of $1.2 million, in various foreign currencies, of which $0.6 million is a restricted deposit as it relates to lease agreements. As of January 31, 2017, two European banks have guaranteed obligations to third parties on behalf of two of the Company’s foreign subsidiaries in the dollar equivalent of $1.2 million, in various foreign currencies, of which $0.6 million is a restricted deposit as it relates to a lease agreement. |
Derivative Financial Instrument
Derivative Financial Instruments | 12 Months Ended |
Jan. 31, 2018 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | NOTE 5 – DERIVATIVE FINANCIAL INSTRUMENTS As of January 31, 2018, the Company’s entire net forward contracts hedging portfolio consisted of 19.0 million Swiss francs equivalent, 10.6 million Euros equivalent and 4.7 million British Pounds equivalent with various expiry dates ranging through June 13, 2018. The following table summarizes the fair value and presentation in the Consolidated Balance Sheets for derivatives as of January 31, 2018 and 2017 (in thousands): Asset Derivatives Liability Derivatives Balance 2018 2017 Balance 2018 2017 Derivatives not designated as hedging instruments: Foreign Exchange Contracts Other Current $ 544 $ 145 Accrued Liabilities $ 2 $ 211 Total Derivative Instruments $ 544 $ 145 $ 2 $ 211 Asset Derivatives Liability Derivatives Balance 2018 2017 Balance 2018 2017 Derivatives designated as hedging instruments: Foreign Exchange Contracts Other Current $ — $ — Accrued Liabilities $ 44 $ — Total Derivative Instruments $ — $ — $ 44 $ — As of January 31, 2018 and 2017, the balance of deferred net gains on derivative financial instruments documented as cash flow hedges included in accumulated other comprehensive income (“AOCI”) were immaterial for both periods, respectively. The maximum length of time the Company hedges its exposure to the fluctuation in future cash flows for forecasted transactions is 24 months. For the fiscal year ended January 31, 2018, the Company reclassified from AOCI to earnings $0.9 million of net loss, net of tax benefit of $0.2 million. For the fiscal year ended January 31, 2017, the Company reclassified from AOCI to earnings $0.4 million of net gains, net of tax of $0.1 million. No ineffectiveness has been recorded in fiscal years 2018 and 2017, respectively. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Jan. 31, 2018 | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Abstract] | |
Fair Value Measurements | NOTE 6 - Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Accounting guidance establishes a fair value hierarchy which prioritizes the inputs used in measuring fair value into three broad levels as follows: • Level 1 - Quoted prices in active markets for identical assets or liabilities. • Level 2 - Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly. • Level 3 - Unobservable inputs based on the Company’s assumptions. The guidance requires the use of observable market data if such data is available without undue cost and effort. The following tables present the fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis as of January 31, 2018 and 2017 (in thousands): Fair Value at January 31, 2018 Balance Sheet Location Level 1 Level 2 Level 3 Total Assets: Available-for-sale securities Other current assets $ 275 $ — $ — $ 275 Short-term investment Other current assets 164 — — 164 SERP assets - employer Other non-current assets 994 — — 994 SERP assets - employee Other non-current assets 38,577 — — 38,577 Hedge derivatives Other current assets — 544 — 544 Total $ 40,010 $ 544 $ — $ 40,554 Liabilities: SERP liabilities - employee Other non-current liabilities $ 38,577 $ — $ — $ 38,577 Hedge derivatives Accrued liabilities — 46 — 46 Total $ 38,577 $ 46 $ — $ 38,623 Fair Value at January 31, 2017 Balance Sheet Location Level 1 Level 2 Level 3 Total Assets: Available-for-sale securities Other current assets $ 309 $ — $ — $ 309 Short-term investment Other current assets 154 154 SERP assets - employer Other non-current assets 1,091 — — 1,091 SERP assets - employee Other non-current assets 30,831 — — 30,831 Hedge derivatives Other current assets — 145 — 145 Total $ 32,385 $ 145 $ — $ 32,530 Liabilities: SERP liabilities - employee Other non-current liabilities $ 30,831 $ — $ — $ 30,831 Hedge derivatives Accrued liabilities — 211 — 211 Total $ 30,831 $ 211 $ — $ 31,042 The fair values of the Company’s available-for-sale securities are based on quoted prices. |
Income Taxes
Income Taxes | 12 Months Ended |
Jan. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | NOTE 7 - INCOME TAXES The 2017 Tax Act that was signed into law on December 22, 2017 significantly changed existing U.S. corporate income tax laws by, among other things, lowering the corporate tax rate from 35% to 21%, limiting the deductibility of interest expense and executive compensation, implementing a territorial tax system, and imposing a one-time mandatory deemed Transition Tax on undistributed foreign earnings which have not been previously taxed. Undistributed foreign earnings in the form of cash and cash equivalents will be taxed at a rate of 15.5% and all other earnings will be taxed at a rate of 8.0%. On December 22, 2017, the SEC issued SAB 118, which allows the Company to record provisional amounts related to the 2017 Tax Act and provides a measurement period of up to one year from the enactment date for companies to complete their accounting under ASC Topic 740. The 2017 Tax Act is complex and the Company has not completed its accounting for the tax effects of the enactment. The $45.0 million estimated impact of the law as of January 31, 2018 is based on management’s current interpretations of the 2017 Tax Act and is subject to changes to the Company’s analysis and assumptions related to certain matters, such as changes to estimates and amounts related to the earnings and profits and tax pools of certain subsidiaries, the Company’s indefinite reinvestment assertion, including the measurement of deferred taxes on foreign unremitted earnings, and its policy related to the treatment of withholding tax transaction gains and losses. The estimated impact of the 2017 Tax Act is also subject to change as a result of additional guidance from, and interpretations by, U.S. regulatory and standard-setting bodies. The Company expects to complete its assessment of these items within the measurement period, and any adjustments to the provisional amounts initially recorded will be included as an adjustment to income tax expense or benefit in the period in which the amounts are determined. The Company has not completed its full analysis with respect to the GILTI provision within the 2017 Tax Act which would require the current inclusion in federal taxable income of earnings of certain foreign controlled corporations. The Company is not yet able to make reasonable estimates of the tax impact of GILTI; The Company has recorded its best estimate of the impact of the 2017 Tax Act in its fiscal year 2018 provision for income taxes in accordance with its understanding of the 2017 Tax Act and, as a result, has recorded a provisional tax expense of $45.0 million in the fourth quarter, the period in which the legislation was enacted. The provisional amount related to the Transition Tax, which will be paid in installments over eight years, was $28.2 million based on an estimate of foreign earnings of $279.9 million. The provisional amount related to the re-measurement of certain deferred tax assets and liabilities based on the rates at which they are expected to reverse in the future was $8.3 million. In light of the 2017 Tax Act, the Company continues to evaluate its assertion related to the permanent reinvestment of earnings in its foreign operations. The provisional change to deferred taxes related to withholding and U.S. state income taxes were $8.5 million based on unremitted foreign earnings of $236.8 million, which are earmarked for future repatriation. The Company performs a quarterly assessment reviewing its global cash projections and investment needs, and considers such factors as projected future results, continued need for investment in the overseas business as well as cash needs in the U.S., among other countries. A deferred tax liability has not been recorded for the remaining undistributed foreign earnings of approximately $83.7 million. In accordance with SAB 118, if the Company revises its assertion regarding the permanent reinvestment of foreign earnings during the measurement period, the change would be recorded as part of the 2017 Tax Act enactment. FASB issued ASU 2018-02, “Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income,” which permits companies to reclassify disproportionate tax effects in accumulated other comprehensive income caused by the 2017 Tax Act to retained earnings. The Company early adopted ASU 2018-02 during the fourth quarter of fiscal 2018 (see Note 18 – Accounting Changes and Recent Accounting Pronouncements) and, as a result, the Company made the election to reclassify the income tax effects of the 2017 Tax Act from AOCI to retained earnings. The adoption of this standard did not have a material impact on the Company’s consolidated results of operations or financial position. Income before provision for income taxes on a legal entity basis consists of the following (in thousands): 2018 2017 2016 U.S. income before taxes $ 11,731 $ 26,299 $ 44,384 Non-U.S. income before taxes 30,411 25,155 24,741 Income before income taxes $ 42,142 $ 51,454 $ 69,125 The Company conducts business globally and, as a result, is subject to income taxes in the U.S. federal, state, local and foreign jurisdictions. In the normal course of business, the Company is subject to examinations by taxing authorities in many countries, such as Germany, Hong Kong, Switzerland and the United States. The Company is no longer subject to income tax examination for years ended prior to January 31, 2014, with few exceptions. The provision for income taxes for the fiscal years ended January 31, 2018, 2017 and 2016 consists of the following components (in thousands): 2018 2017 2016 Current: U.S. Federal $ 31,599 $ 14,079 $ 17,776 U.S. State and Local 960 1,117 1,434 Non-U.S. 7,145 5,091 5,291 39,704 20,287 24,501 Deferred: U.S. Federal 16,671 (4,231 ) (1,995 ) U.S. State and Local 622 (167 ) (228 ) Non-U.S. 370 426 1,082 17,663 (3,972 ) (1,141 ) Provision for income taxes $ 57,367 $ 16,315 $ 23,360 Significant components of the Company’s deferred income tax assets and liabilities as of January 31, 2018 and 2017 are as follows (in thousands): 2018 Deferred Taxes 2017 Deferred Taxes Assets Liabilities Assets Liabilities Net operating loss carryforwards $ 10,589 $ — $ 10,516 $ — Inventory 2,199 — 3,782 — Unprocessed returns 955 — 1,200 — Receivables allowances 227 — 1,151 — Deferred compensation 12,985 — 18,955 — Unrepatriated earnings — 11,690 — 2,956 Capital loss carryforwards — — 389 — Depreciation/amortization — 4,440 — 1,245 Other provisions/accruals 63 — 207 — Miscellaneous — 199 955 — 27,018 16,329 37,155 4,201 Valuation allowance (8,960 ) — (8,714 ) — Total deferred tax assets and liabilities $ 18,058 $ 16,329 $ 28,441 $ 4,201 As of January 31, 2018, the Company had no U.S. federal net operating loss carryforwards and had U.S. state and foreign net operating loss carryforwards of approximately $9.0 million and $39.1 million, respectively, with expiration dates ranging from 1-10 years and some foreign jurisdictions with an indefinite carryforward period. Of the foreign net operating losses, $16.4 million are related to Switzerland and the remaining is related to Germany, China and other foreign countries. A valuation allowance is required to be established unless management determines it is more likely than not that the Company will ultimately utilize the tax benefit associated with a deferred tax asset. The Company has U.S. state and foreign valuation allowances of $0.1 million and $8.9 million, respectively, which are primarily related to net operating loss carryforwards. Management will continue to evaluate the appropriate level of valuation allowance on all deferred tax assets considering such factors as prior earnings history, expected future earnings, carryback and carryforward periods, and tax and business strategies that could potentially enhance the likelihood of realization of the deferred tax assets. The Company adopted the provisions of ASU 2016-09, “Improvements to Employee Share-Based Payment Accounting,” during the first quarter of fiscal year 2018 (see Note 18 – Accounting Changes and Recent Accounting Pronouncements for additional disclosures). The new guidance requires, among other provisions, that excess tax benefits and tax deficiencies associated with stock-based compensation to be recorded as an income tax expense or benefit in the period in which the awards vest or are settled. Prior to fiscal year 2018, the recognition of deductible windfall tax benefits related to stock-based compensation was prohibited until realized through a reduction to income taxes payable. Shortfall tax expenses of $1.1 million was recorded in income tax expense during fiscal year 2018. Shortfall tax expenses of $0.3 million and $0.0 million were recorded in additional paid-in-capital during fiscal years 2017 and 2016, respectively. The provision for income taxes differs from the U.S. federal statutory rate due to the following (in thousands): Fiscal Year Ended January 31, 2018 2017 2016 Provision for income taxes at the U.S. statutory rate $ 14,248 $ 18,009 $ 24,194 Lower effective non-U.S. income tax rate (4,378 ) (4,725 ) (4,463 ) Change in valuation allowance 136 828 986 U.S. tax provided on earnings of non-U.S. subsidiaries — 541 1,029 Change in liabilities for uncertain tax positions, net (381 ) 215 (98 ) State and local taxes, net of federal benefit 626 617 1,234 Impact of 2017 Tax Act 45,002 — — Excess tax deficiencies from stock-based compensation 1,094 — — Non-deductible acquisition costs 786 — — Other, net 234 830 478 Total provision for income taxes $ 57,367 $ 16,315 $ 23,360 Due to the 2017 Tax Act, the Company had a U.S. federal statutory blended rate of 33.8%, for its fiscal year ended January 31, 2018. For fiscal years 2017 and 2016, the federal statutory rate in the above table remains at 35%. The effective tax rate for fiscal 2018 was 136.1%, primarily due to the impact of the 2017 Tax Act and excess tax deficiencies related to stock-based compensation, partially offset by foreign profits being taxed in lower taxing jurisdictions. The effective tax rate for fiscal 2017 was 31.7%, primarily as a result of foreign profits being taxed in lower taxing jurisdictions, partially offset by no tax benefit being recognized on certain earnings of foreign subsidiaries and U.S. tax provided on earnings of non-U.S. subsidiaries. The effective tax rate for fiscal 2016 was 33.8%, primarily as a result of foreign profits being taxed in lower taxing jurisdictions, partially offset by U.S. tax provided on earnings of non-U.S. subsidiaries. A reconciliation of the beginning and ending amounts of gross unrecognized tax benefits (exclusive of interest) for the fiscal years ended January 31, 2018, 2017 and 2016 are as follows (in thousands): 2018 2017 2016 Beginning balance $ 2,619 $ 2,481 $ 2,657 Additions for tax positions taken in the current year 180 142 175 Tax positions taken in prior years 148 — — Lapse of statute of limitations (630 ) — (311 ) Settlements (149 ) — — Non U.S. currency exchange fluctuations 186 (4 ) (40 ) Ending balance $ 2,354 $ 2,619 $ 2,481 Included in the balances at January 31, 2018, January 31, 2017 and January 31, 2016 are $2.3 million, $2.6 million, and $2.4 million of unrecognized tax benefits which would impact the Company’s effective tax rate, if recognized. Interest and penalties, if any, related to unrecognized tax benefits are recorded as income tax expense in the consolidated statement of operations. As of January 31, 2018, January 31, 2017 and January 31, 2016, the Company had $0.8 million, $0.7 million and $0.6 million, respectively of accrued interest (net of tax benefit) and penalties related to unrecognized tax benefits. During fiscal years 2018, 2017 and 2016, the Company accrued $0.1 million, $0.1 million and $0.1 million of interest (net of tax benefit) and penalties. |
Leases
Leases | 12 Months Ended |
Jan. 31, 2018 | |
Leases [Abstract] | |
Leases | NOTE 8 – LEASES The Company leases office, distribution, retail and manufacturing facilities, and office equipment under operating leases, which expire at various dates through June 2030. Certain leases include renewal options and the payment of real estate taxes and other occupancy costs. Some leases also contain rent escalation clauses (step rents) that require additional rent amounts in the later years of the term. Rent expense for leases with step rents is recognized on a straight-line basis over the minimum lease term. Likewise, capital funding and other lease concessions that are occasionally provided to the Company are recorded as deferred rent and amortized on a straight-line basis over the minimum lease term as adjustments to rent expense. Rent expense for equipment and distribution, factory and office facilities under operating leases was approximately $17.8 million, $14.2 million and $13.5 million in fiscal 2018, 2017 and 2016, respectively. Minimum annual rentals under noncancelable operating leases as of January 31, 2018, excluding real estate taxes and operating costs, are as follows (in thousands): Fiscal Year Ending January 31, 2019 $ 11,607 2020 7,490 2021 7,041 2022 6,245 2023 5,563 Thereafter 28,234 $ 66,180 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Jan. 31, 2018 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | NOTE 9 – COMMITMENTS AND CONTINGENCIES The Company has minimum commitments related to the Company’s license agreements and endorsement agreements with brand ambassadors. The Company sources, distributes, advertises and sells watches pursuant to its exclusive license agreements with unaffiliated licensors. Royalty amounts under the license agreements are generally based on a stipulated percentage of revenues, although most of these agreements contain provisions for the payment of minimum annual royalty amounts. The license agreements have various terms and some have additional renewal options, provided that minimum sales levels are achieved. Additionally, the license agreements require the Company to pay minimum annual advertising amounts. As of January 31, 2018, the total amount of the Company’s minimum commitments related to its license agreements and endorsement agreements was $202.0 million. The Company had outstanding purchase obligations of $83.8 million with suppliers at the end of fiscal 2018 primarily for raw materials, finished watches and packaging in the normal course of business. These purchase obligation amounts do not represent total anticipated purchases but represent only amounts to be paid for items required to be purchased under agreements that are enforceable, legally binding and specify minimum quantity, price and term. Due to the enactment of the 2017 Tax Act, the Company estimated a provisional obligation associated with the Transaction Tax to be $28.2 million, which will be paid in installments over eight years. This provisional amount, as well as the current estimated timing of payments, is subject to change based on additional guidance from and interpretations by U.S. regulatory and standard-setting bodies and changes in assumptions. The Company believes that income tax reserves are adequate; however, amounts asserted by taxing authorities could be greater or less than amounts accrued and reflected in the consolidated balance sheet. Accordingly, the Company could record adjustments to the amounts for federal, state, and foreign liabilities in the future as the Company revises estimates or settles or otherwise resolves the underlying matters. In the ordinary course of business, the Company may take new positions that could increase or decrease unrecognized tax benefits in future periods. During fiscal 2018, the Company released to cash $1.0 million in restricted cash deposits that were previously recorded in other current assets on the Company’s Consolidated Balance Sheet, related to a certain vendor agreement. In December 2016, U.S. Customs and Border Protection (“U.S. Customs”) issued an audit report concerning the methodology used by the Company to allocate the cost of certain watch styles imported into the U.S. among the component parts of those watches for tariff purposes. The report disputes the reasonableness of the Company’s historical allocation formulas and proposes an alternative methodology that would imply approximately $5.1 million in underpaid duties over the five-year period covered by the statute of limitations, plus possible penalties and interest. The Company believes that U.S. Customs’ alternative duty methodology and estimate are not consistent with the Company’s facts and circumstances and is disputing U.S. Customs’ position. The Company continues to provide U.S. Customs with supplemental analyses and information supporting the Company’s historical allocation formulas. Although the Company disagrees with U.S. Customs’ position, it cannot predict with any certainty the outcome of this matter. The Company intends to continue to work with U.S. Customs to reach a mutually-satisfactory resolution. The Company is involved in legal proceedings and claims from time to time, in the ordinary course of its business. Legal reserves are recorded in accordance with the accounting guidance for contingencies. Contingencies are inherently unpredictable and it is possible that results of operations, balance sheets or cash flows could be materially and adversely affected in any particular period by unfavorable developments in, or resolution or disposition of, such matters. For those legal proceedings and claims for which the Company believes that it is probable that a reasonably estimable loss may result, the Company records a reserve for the potential loss. For proceedings and claims where the Company believes it is reasonably possible that a loss may result that is materially in excess of amounts accrued for the matter, the Company either discloses an estimate of such possible loss or range of loss or includes a statement that such an estimate cannot be made. As of January 31, 2018, the Company is party to legal proceedings and contingencies, the resolution of which is not expected to materially affect its financial condition, future results of operations beyond the amounts accrued, or cash flows. |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Jan. 31, 2018 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock-Based Compensation | NOTE 10 – STOCK-BASED COMPENSATION Under the Company’s Employee Stock Option Plan, as amended and restated as of April 4, 2013 (the “Plan”), the Compensation Committee of the Board of Directors, which consists of four of the Company’s non-employee directors, has the authority to grant incentive stock options and nonqualified stock options, as well as stock appreciation rights and stock awards, for up to 11,000,000 shares of common stock. Options granted to participants under the Plan generally become exercisable in equal installments over three years and remain exercisable until the tenth anniversary of the date of grant. The option price may not be less than the fair market value of the stock at the time the options are granted. The weighted-average assumptions used with the Black-Scholes option-pricing model for the calculation of the fair value of stock option grants during fiscal 2018 were: expected term of 6.0 years; risk-free interest rate of 1.93%; expected volatility of 46.16% and dividend yield of 1.51%. The weighted-average grant date fair value of options granted during the fiscal year ended January 31, 2018 was $9.15. The weighted-average assumptions used with the Black-Scholes option-pricing model for the calculation of the fair value of stock option grants during fiscal 2017 were: expected term of 6.0 years; risk-free interest rate of 1.42%; expected volatility of 47.81% and dividend yield of 1.01%. The weighted-average grant date fair value of options granted during the fiscal year ended January 31, 2017 was $11.17. The weighted-average assumptions used with the Black-Scholes option-pricing model for the calculation of the fair value of stock option grants during fiscal 2016 were: expected term of 5.0 years; risk-free interest rate of 1.34%; expected volatility of 48.77% and dividend yield of 0.81%. The weighted-average grant date fair value of options granted during the fiscal year ended January 31, 2016 was $12.31. Total compensation expense for stock option grants recognized during the fiscal years ended January 31, 2018, 2017 and 2016 was approximately $0.5 million, net of tax of $0.3 million and $1.3 million, net of tax of $0.8 million and $1.1 million, net of tax of $0.6 million, respectively. Expense related to stock option compensation is recognized on a straight-line basis over the vesting term. As of January 31, 2018, there was approximately $1.6 million of unrecognized compensation cost related to unvested stock options. These costs are expected to be recognized over a weighted-average period of 1.8 years. Total consideration received for stock option exercises during the fiscal years ended January 31, 2018, 2017 and 2016 was approximately $2.0 million, $1.0 million and $0.6 million, respectively. The windfall tax expense realized on these exercises in fiscal 2018 was approximately $0.5 million. Transactions for stock options under the Plan since fiscal 2015 are summarized as follows: Outstanding Weighted- January 31, 2015 616,220 $ 30.08 Options granted 126,880 $ 30.36 Options exercised (28,450 ) $ 21.49 Options cancelled (15,050 ) $ 33.32 January 31, 2016 699,600 $ 30.41 Options granted 200,346 $ 26.97 Options exercised (40,588 ) $ 25.68 Options cancelled — $ — January 31, 2017 859,358 $ 29.83 Options granted 161,205 $ 23.35 Options exercised (85,600 ) $ 23.18 Options cancelled (173,262 ) $ 30.21 January 31, 2018 761,701 $ 29.12 The total fair value of stock options exercised for the fiscal years ended January 31, 2018, 2017 and 2016 was approximately $0.5 million, $0.2 million and $0.2 million, respectively. The total fair value of the stock options vested for the fiscal years ended January 31, 2018, 2017 and 2016 was approximately $1.3 million, $2.0 million and $2.9 million, respectively. The following table summarizes outstanding and exercisable stock options as of January 31, 2018: Range of Exercise Prices Number Weighted- Weighted- Number Weighted- $21.03 - $24.02 161,955 9.2 $ 23.34 750 $ 22.04 $24.03 - $27.02 166,012 4.2 $ 26.59 166,012 $ 26.59 $27.03 - $30.02 140,811 8.2 $ 27.74 — $ — $30.03 - $33.02 189,770 6.1 $ 30.35 124,540 $ 30.34 $33.03 - $42.02 19,853 6.4 $ 40.52 19,853 $ 40.52 $42.03 - $45.02 83,300 6.2 $ 42.12 83,300 $ 42.12 761,701 6.3 $ 29.12 394,455 $ 31.75 The total intrinsic value of outstanding stock options as of January 31, 2018, 2017 and 2016 was approximately $2.3 million, $0.6 million and $0.3 million, respectively. The total intrinsic value of exercisable stock options as of January 31, 2018, 2017 and 2016 was approximately $0.7 million, $0.4 million and $0.3 million, respectively. Under the Plan, the Company has the ability to grant stock awards to employees. Stock awards generally vest three years from the date of grant. Expense for these grants is recognized on a straight-line basis over the vesting period. The fair value of stock awards is equal to the closing price of the Company’s publicly-traded common stock on the grant date. For fiscal years 2018, 2017 and 2016, compensation expense for stock awards was approximately $1.8 million, net of tax of $1.1 million, $3.2 million, net of tax of $2.0 million and $2.7 million, net of tax of $1.7 million, respectively. The Company elected, as part of the adoption of ASU 2016-09, “Improvements to Employee Share-Based Payment Accounting,” (see Note 18 – Accounting Changes and Recent Accounting Pronouncements), to continue its existing accounting treatment for forfeitures, which are estimated at the time of grant in order to estimate the amount of share-based awards that will ultimately vest and thus, current period compensation expense has been adjusted for estimated forfeitures based on historical data. As of January 31, 2018, there was approximately $3.6 million of unrecognized compensation cost related to unvested stock awards. These costs are expected to be recognized over a weighted-average period of 1.6 years. Transactions for stock award units under the Plan since fiscal 2015 are summarized as follows: Number of Stock Award Weighted- January 31, 2015 337,356 $ 34.72 Units granted 136,310 $ 29.48 Units vested (83,578 ) $ 29.99 Units forfeited (15,490 ) $ 35.70 January 31, 2016 374,598 $ 33.83 Units granted 187,777 $ 27.76 Units vested (170,010 ) $ 31.85 Units forfeited (11,207 ) $ 34.50 January 31, 2017 381,158 $ 31.71 Units granted 133,245 $ 23.31 Units vested (115,574 ) $ 39.44 Units forfeited (56,059 ) $ 30.27 January 31, 2018 342,770 $ 26.07 Upon the vesting of a stock award, shares equal to the number of underlying stock award units are issued from the pool of authorized shares. The total fair value of stock award units that vested during fiscal 2018, 2017 and 2016 was approximately $2.6 million, $4.8 million, and $2.5 million, respectively. The windfall tax expense realized on the vested stock awards for fiscal 2018 was $0.6 million. The weighted-average grant date fair values for stock awards for fiscal 2018, 2017, and 2016 were $23.31, $27.76 and $29.48, respectively. Unvested stock award units had a total fair value of approximately $10.5 million, $10.3 million, and $9.6 million for fiscal 2018, 2017 and 2016, respectively. |
Other Employee Benefit Plans
Other Employee Benefit Plans | 12 Months Ended |
Jan. 31, 2018 | |
Defined Contribution Pension And Other Postretirement Plans Disclosure [Abstract] | |
Other Employee Benefit Plans | NOTE 11 – OTHER EMPLOYEE BENEFIT PLANS The Company maintains an Employee Savings Plan under Section 401(k) of the Internal Revenue Code. In addition, the Company maintains defined contribution employee benefit plans for its employees located in Switzerland, Asia and the United Kingdom. Company contributions and expenses of administering the plans were $3.1 million, $3.1 million and $2.9 million in fiscal 2018, 2017 and 2016, respectively. The Company maintains a defined contribution Deferred Compensation Plan (also known as a supplemental employee retirement plan or SERP). The SERP provides eligible executives with supplemental retirement benefits in addition to amounts received under the Company’s other retirement plans. The Company makes a matching contribution, up to either 5% or 10% of the executive’s salary, which vests in equal annual installments over five years. During fiscal 2018, 2017 and 2016, the Company recorded expenses related to the SERP of $0.6 million, $0.9 million, which includes $0.3 million related to the retirement of the Company’s former Vice Chairman and Chief Operating Officer, and $0.4 million, respectively. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income | 12 Months Ended |
Jan. 31, 2018 | |
Accumulated Other Comprehensive Income Loss Net Of Tax [Abstract] | |
Accumulated Other Comprehensive Income | NOTE 12 – ACCUMULATED OTHER COMPREHENSIVE INCOME The components of accumulated other comprehensive income at January 31, consisted of the following (in thousands): Currency Translation Available- Hedging Total Balance, January 31, 2017 $ 76,569 $ 197 $ 14 $ 76,780 Other comprehensive income / (loss) before 23,621 (6 )* 874 24,489 Amounts reclassified from — — (926 ) (926 ) Net current-period other 23,621 (6 ) (52 ) 23,563 Balance, January 31, 2018 $ 100,190 $ 191 $ (38 ) $ 100,343 Currency Translation Available- Hedging Total Balance, January 31, 2016 $ 68,265 $ 189 $ 51 $ 68,505 Other comprehensive income / (loss) before 8,389 8 (408 ) 7,989 Amounts reclassified from (85 ) — 371 286 Net current-period other 8,304 8 (37 ) 8,275 Balance, January 31, 2017 $ 76,569 $ 197 $ 14 $ 76,780 * Includes approximately twenty-one thousand dollars related to the tax effect of the tax rate change on marketable securities (see Note 7 – Income Taxes). (1) Amounts in fiscal 2018 and 2017 were reclassified to operating income in the Consolidated Statements of Operations. |
Segment and Geographic Informat
Segment and Geographic Information | 12 Months Ended |
Jan. 31, 2018 | |
Segment Reporting [Abstract] | |
Segment and Geographic Information | NOTE 13 – SEGMENT AND GEOGRAPHIC INFORMATION The Company follows accounting guidance related to disclosures about segments of an enterprise and related information. This guidance requires disclosure of segment data based on how management makes decisions about allocating resources to segments and measuring their performance. The Company conducts its business in two operating segments: Wholesale and Retail. The Company’s Wholesale segment includes the designing, manufacturing and distribution of watches of quality owned brands and licensed brands, in addition to revenue generated from after-sales service activities and shipping. The Retail segment includes the Company’s retail outlet locations. The Company divides its business into two major geographic locations: United States operations, and International, which includes the results of all non-U.S. Company operations. The allocation of geographic revenue is based upon the location of the customer. The Company’s International operations in Europe, the Americas (excluding the United States), the Middle East and Asia accounted for 32.1%, 9.2%, 7.7% and 5.1%, respectively, of the Company’s total net sales for fiscal 2018. For fiscal 2017, the Company’s International operations in Europe, the Americas (excluding the United States), the Middle East and Asia accounted for 23.1%, 8.9%, 8.1% and 6.3%, respectively, of the Company’s total net sales. For fiscal 2016, the Company’s International operations in Europe, the Americas (excluding the United States), the Middle East and Asia accounted for 21.2%, 10.5%, 7.4% and 6.1%, respectively, of the Company’s total net sales. Substantially all of the Company’s tangible International assets are owned by the Company’s Swiss and Hong Kong subsidiaries. Operating Segment Data as of and for the Fiscal Year Ended January 31, (in thousands): Net Sales (5) 2018 2017 2016 Wholesale: Owned brands category $ 204,897 $ 205,396 $ 219,012 Licensed brands category 277,323 265,137 297,227 After-sales service and all other 9,862 13,911 13,770 Total Wholesale 492,082 484,444 530,009 Retail 75,871 68,308 64,914 Consolidated total $ 567,953 $ 552,752 $ 594,923 Operating Income 2018 2017 2016 Wholesale $ 28,296 $ 41,773 $ 58,242 Retail 14,904 12,208 11,865 Consolidated total $ 43,200 $ 53,981 $ 70,107 Total Assets Capital Expenditures 2018 2017 2018 2017 2016 Wholesale $ 621,965 $ 584,518 $ 3,133 $ 5,666 $ 5,902 Retail 23,415 23,284 2,677 254 2,168 Consolidated total $ 645,380 $ 607,802 $ 5,810 $ 5,920 $ 8,070 Depreciation and Amortization 2018 2017 2016 Wholesale $ 11,765 $ 9,875 $ 11,561 Retail 1,692 1,632 1,595 Consolidated total $ 13,457 $ 11,507 $ 13,156 Geographic Location Data as of and for the Fiscal Year Ended January 31, (in thousands): Net Sales (5) Operating (Loss) / Income 2018 2017 2016 2018 2017 2016 United States $ 260,606 $ 296,311 $ 326,206 $ (629) $ 16,917 $ 29,867 International 307,347 256,441 268,717 43,829 37,064 40,240 Consolidated total $ 567,953 $ 552,752 $ 594,923 $ 43,200 $ 53,981 $ 70,107 Total Assets Property, Plant and Equipment, Net 2018 2017 2018 2017 United States $ 188,346 $ 207,246 $ 16,570 $ 19,197 International 457,034 400,556 8,101 14,976 Consolidated total $ 645,380 $ 607,802 $ 24,671 $ 34,173 (1) Fiscal 2018 Wholesale and United States and International operating (loss) / income included a charge of $6.8 million related to transaction charges and the amortization of acquisition accounting adjustments associated with the purchase of the Olivia Burton brand. (2) Fiscal 2018 Wholesale and United States and International operating (loss) / income included a charge of $13.6 million as part of the Company’s cost savings initiatives. In fiscal 2018, the Company took actions to better align its global infrastructure with the current business environment by consolidating certain operations and streamlining functions to reduce costs and improve profitability. Also, in light of the changing retail landscape and the growing importance of digital marketing and online sales, the Company decided to cease its participation in the Baselworld Watch and Jewelry Show. (3) Fiscal 2017 Wholesale and United States operating income included a pre-tax charge of $1.8 million, as a result of the immediate vesting of stock awards and certain other compensation related to the announcement of the retirement of the Company’s former Vice Chairman and Chief Operating Officer, in fiscal 2017. ( 4 ) Fiscal 2016 Wholesale and United States and International operating income included a $4.0 million charge as a result of actions taken by the Company in fiscal 2016 to achieve greater operating efficiencies and streamline its operations. ( 5 ) The United States and International net sales are net of intercompany sales of $268.1 million, $289.2 million and $309.1 million for the fiscal years ended January 31, 2018, 2017 and 2016, respectively. (6 ) The United States operating income included $25.2 million, $26.3 million and $27.0 million of unallocated corporate expenses for the fiscal years ended January 31, 2018, 2017 and 2016, respectively. (7 ) The International operating income included $41.5 million, $40.0 million and $44.5 million of certain intercompany profits related to the Company’s supply chain operations for the fiscal years ended January 31, 2018, 2017 and 2016, respectively. |
Quarterly Financial Data (Unaud
Quarterly Financial Data (Unaudited) | 12 Months Ended |
Jan. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Data (Unaudited) | NOTE 14 - QUARTERLY FINANCIAL DATA (UNAUDITED) The following table presents unaudited selected interim operating results of the Company for fiscal 2018 and 2017 (in thousands, except per share amounts): Quarter 1 st 2 nd 3 rd 4 th Fiscal 2018 Net sales $ 99,265 $ 128,781 $ 190,693 $ 149,214 Gross profit $ 49,137 $ 66,126 $ 104,070 $ 78,745 (Loss) / Income before income taxes $ (3,882 ) $ 8,056 $ 24,850 $ 13,118 Net (loss) / income attributed to Movado Group, Inc. $ (4,159 ) $ 5,482 $ 17,360 $ (33,908 ) Basic income per share: Net (loss) / income attributed to Movado Group, Inc. $ (0.18 ) $ 0.24 $ 0.75 $ (1.47 ) Diluted income per share: Net (loss) / income attributed to Movado Group, Inc. $ (0.18 ) $ 0.24 $ 0.75 $ (1.47 ) Fiscal 2017 Net sales $ 114,063 $ 128,086 $ 179,818 $ 130,785 Gross profit $ 61,317 $ 70,263 $ 98,550 $ 64,687 Income before income taxes $ 5,060 $ 9,796 $ 29,501 $ 7,097 Net income $ 3,337 $ 6,355 $ 20,215 $ 5,232 Net income attributed to Movado Group, Inc. $ 3,308 $ 6,306 $ 20,215 $ 5,232 Basic income per share: Net income attributed to Movado Group, Inc. $ 0.14 $ 0.27 $ 0.88 $ 0.23 Diluted income per share: Net income attributed to Movado Group, Inc. $ 0.14 $ 0.27 $ 0.87 $ 0.22 As each quarter is calculated as a discrete period, the sum of the four quarters may not equal the calculated full year amount. This is in accordance with prescribed reporting requirements. |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 12 Months Ended |
Jan. 31, 2018 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Cash Flow Information | NOTE 15 - SUPPLEMENTAL CASH FLOW INFORMATION The following is provided as supplemental information to the consolidated statements of cash flows (in thousands): Fiscal Year Ended January 31, 2018 2017 2016 Cash paid during the year for: Interest $ 1,223 $ 1,121 $ 797 Income taxes, net $ 20,366 $ 22,768 $ 22,500 Supplemental disclosures of non-cash investing activities: Additions to property, plant and equipment included in accrued liabilities $ — $ 4 $ — |
Net (Loss) _ Income Attributed
Net (Loss) / Income Attributed to Movado Group, Inc. and Transfers to Noncontrolling Interest | 12 Months Ended |
Jan. 31, 2018 | |
Net Income Attributable To Group And Transfers To Noncontrolling Interest [Abstract] | |
Net (Loss) / Income Attributed to Movado Group, Inc. and Transfers to Noncontrolling Interest | NOTE 16 – NET (LOSS) / INCOME ATTRIBUTED TO MOVADO GROUP, INC. AND TRANSFERS TO NONCONTROLLING INTEREST For Fiscal Year Ended January 31, 2018 2017 2016 Net (loss) / income attributed to Movado Group, Inc. $ (15,225 ) $ 35,061 $ 45,094 Transfers to the noncontrolling interest Decrease in Movado Group, Inc.’s paid-in capital for purchase of joint venture common shares — (1,011 ) (3,613 ) Net transfers to noncontrolling interest — (1,011 ) (3,613 ) Change from net (loss) / income attributed to Movado Group, Inc. and transfers to noncontrolling interest $ (15,225 ) $ 34,050 $ 41,481 On August 4, 2016, Movado Group, Inc. and Majorelle Limited, an English company (“Majorelle”), voluntarily terminated the joint venture agreement they had entered into on January 30, 2013 (the “JV Agreement”) relating to MGS Distribution Limited, an English company (“MGS”). Under the JV Agreement, the Company and Majorelle owned 90% and 10%, respectively, of the issued and outstanding shares of MGS which had been formed to distribute the Company’s licensed watch brands in the United Kingdom. In connection with the mutual agreement to terminate the JV Agreement, the Company acquired the remaining shares in MGS from Majorelle, for the purchase price of $1.7 million, thereby increasing its ownership interest in MGS to 100%. Since August 4, 2016, the Company has accounted for MGS as a wholly-owned subsidiary. On January 6, 2016, Movado Group, Inc. and Financiere TWC SA (“TWC”), a French company with established distribution, marketing and sales operations in France and Germany, terminated the joint venture agreement they entered into on August 31, 2005 (the “JV Agreement”) relating to MGI-TWC B.V., a Dutch holding company that wholly owns MGI-TWC SAS, a French corporation, and MGI-TWC GmbH, a German corporation (collectively, the “Subsidiaries”). Under the JV Agreement, the Company and TWC controlled 51% and 49%, respectively, of MGI-TWC B.V. On January 6, 2016 the JV Agreement was terminated in connection with the acquisition by the Company of the outstanding 49% ownership interest in MGI-TWC B.V, for the purchase price of $5.6 million. Since that date, the Company has accounted for the Subsidiaries as wholly-owned entities. |
Treasury Stock
Treasury Stock | 12 Months Ended |
Jan. 31, 2018 | |
Equity [Abstract] | |
Treasury Stock | NOTE 17 – TREASURY STOCK On August 29, 2017, the Board approved a share repurchase program under which the Company is authorized to purchase up to $50.0 million of its outstanding common stock from time to time, depending on market conditions, share price and other factors. The Company may purchase shares of its common stock through open market purchases, repurchase plans, block trades or otherwise. This authorization expires on August 29, 2020 and replaced a prior share repurchase program approved by the Board on March 31, 2016 under which the Company was authorized to purchase up to $50.0 million of its outstanding common stock from time to time and under which approximately $5.5 million had been repurchased. During the fiscal year ended January 31, 2018, under both the new and previously authorized repurchase plans, the Company repurchased a total of 140,507 shares of its common stock at a total cost of approximately $3.6 million, or an average of $25.84 per share, which included 40,000 shares repurchased from the Movado Group Foundation at a total cost of approximately $1.1 million, or an average of $27.13 per share. During the fiscal year ended January 31, 2017, under the previously issued share repurchase program, the Company repurchased a total of 157,499 shares of its common stock at a total cost of approximately $3.9 million, or an average of $24.54 per share, which included 35,000 shares repurchased from the Movado Group Foundation at a total cost of approximately $1.0 million, or an average of $29.03 per share. There were 36,843 and 47,310 shares of common stock repurchased during the fiscal year ended January 31, 2018 and 2017, respectively, as a result of the surrender of shares in connection with the vesting of certain stock awards. At the election of an employee, shares having an aggregate value on the vesting date equal to the employee’s withholding tax obligation may be surrendered to the Company. |
Accounting Changes and Recent A
Accounting Changes and Recent Accounting Pronouncements | 12 Months Ended |
Jan. 31, 2018 | |
Accounting Changes And Error Corrections [Abstract] | |
Accounting Changes and Recent Accounting Pronouncements | NOTE 18 – ACCOUNTING CHANGES AND RECENT ACCOUNTING PRONOUNCEMENTS On February 14, 2018, FASB issued ASU 2018-02, “Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income,” which permits companies to reclassify disproportionate tax effects in accumulated other comprehensive income caused by the 2017 Tax Act to retained earnings. The Company early adopted ASU 2018-02 during the fourth quarter of fiscal 2018 (see Note 7 – Income Taxes) and, as a result, the Company made the election to reclassify the income tax effects of the 2017 Tax Act from AOCI to retained earnings. The adoption of this standard did not have a material impact on the Company’s consolidated results of operations or financial position. On January 26, 2017, FASB issued ASU 2017-04, “Intangibles - Goodwill and Other: Simplifying the Test for Goodwill Impairment,” which eliminates the requirement to calculate the implied fair value when calculating goodwill, essentially eliminating step two from the goodwill impairment test. The new standard requires goodwill impairment to be based upon the results of step one of the impairment test, which evaluates the extent, if any, by which the carrying value of a reporting unit exceeds its fair value, with any resulting impairment not exceeding the carrying amount of goodwill. The Company early adopted ASU 2017-04 on a prospective basis during the second quarter of fiscal 2018 in light of goodwill recorded in the period, which was associated with the acquisition of the Olivia Burton brand (see Note 21 – Acquisitions). The adoption of this standard did not have a material impact on the Company’s consolidated results of operations or financial position. On January 5, 2017, FASB issued ASU 2017-01, “Business Combinations: Clarifying the Definition of a Business,” which clarifies the definition of a business. The objective of this ASU is to assist entities in determining whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The Company early adopted ASU 2017-01 on a prospective basis during the second quarter of fiscal 2018, in connection with the acquisition of the Olivia Burton brand (see Note 21 – Acquisitions). The adoption of this standard did not have a material impact on the Company’s consolidated results of operations or financial position. On March 30, 2016, FASB issued ASU 2016-09, “Improvements to Employee Share-Based Payment Accounting,” On August 28, 2017, FASB issued ASU 2017-12, “Derivatives and Hedging: Targeted Improvements to Accounting for Hedging Activities,” which expands an entity’s ability to apply hedge accounting for nonfinancial and financial risk components and allows for a simplified approach for fair value hedging of interest rate risk. The new guidance eliminates the requirement to separately measure and report hedge ineffectiveness and generally requires the entire change in fair value of a hedging instrument to be presented in the same income statement line as the hedged item. The new guidance also simplifies the hedge documentation and effectiveness assessment requirements. For public companies, the standard will be effective for the first interim reporting period within annual periods beginning after December 15, 2018, with early adoption permitted. The new standard must be adopted using a modified retrospective transition with a cumulative effect adjustment recorded to opening retained earnings as of the initial adoption date. The Company is evaluating the impact of the adoption of this guidance on the Company’s consolidated financial statements. On February 25, 2016, FASB issued ASU 2016-02, “Leases,” which requires lessees to recognize most leases on the balance sheet. This change is expected to increase both reported assets and liabilities. The new lease standard does not substantially change lessor accounting. The requirements of this standard include a significant increase in required disclosures and will result in a material increase to the company’s total assets and liabilities through recognition of right-of-use assets and related lease liabilities. On January 5, 2018, FASB issued ASU 2018-01, “Leases: Land Easement Practical Expedient for Transition to Topic 842,” which permits an entity to elect an optional transition practical expedient related to land easements. For public companies, the standards will be effective for the first interim reporting period within annual periods beginning after December 15, 2018, although early adoption is permitted. Lessees and lessors will be required to apply the new standards at the beginning of the earliest period presented in the financial statements in which they first apply the new guidance, using a modified retrospective transition method. The Company is analyzing the impact of the adoption of this guidance on the Company’s consolidated financial statements, including assessing changes that might be necessary to information technology systems, processes and internal controls to capture data and address changes in financial reporting. On May 28, 2014, FASB issued ASU 2014-09, “Revenue from Contracts with Customers.” This pronouncement affects any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets, unless those contracts are within the scope of other standards (for example, insurance contracts or lease contracts). The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In July 2015, FASB deferred the effective date of the guidance. The new revenue standard is effective for fiscal years, and interim periods within those years, beginning after December 15, 2017 and allows either a full retrospective adoption to all periods presented or a modified retrospective adoption approach with the cumulative effect of initial application of the revised guidance recognized at the date of initial application. Early adoption is permitted for periods beginning after December 15, 2016. On March 30, 2016, FASB issued ASU 2016-08, “Revenue from Contracts with Customers (Principal versus Agent Considerations),” to clarify the implementation guidance on principal versus agent considerations. On April 14, 2016, FASB issued ASU 2016-10, “Revenue from Contracts with Customers (Identifying Performance Obligations and Licensing),” to clarify the implementation guidance on identifying performance obligations and accounting for licenses of intellectual property. On May 9, 2016, FASB issued ASU 2016-12, “Revenue from Contracts with Customers (Narrow-Scope Improvements and Practical Expedients),” to clarify the implementation guidance on assessing collectability, presentation of sales taxes, noncash consideration and completed contracts and contract modifications at transition. The Company has assessed the impact of the guidance by reviewing its existing customer contracts and current accounting policies and practices to identify differences that will result from applying the new requirements, including the evaluation of its performance obligations, transaction price, customer payments, transfer of control and principal versus agent considerations. The Company does anticipate some timing changes, notably related to the recognition of markdowns and returns, which upon adoption, will reduce the Company's retained earnings by approximately $0.7 million to record additional markdown and return allowances as a reduction to accounts receivable. The Company has adopted the new standard on February 1, 2018 under the modified retrospective method and will apply certain practical expedients available under the new standard. |
Operating Efficiency Initiative
Operating Efficiency Initiatives and Other Items | 12 Months Ended |
Jan. 31, 2018 | |
Restructuring And Related Activities [Abstract] | |
Operating Efficiency Initiatives and Other Items | NOTE 19 – OPERATING EFFICIENCY INITIATIVES AND OTHER ITEMS In fiscal 2016, the Company commenced an initiative to achieve greater operating efficiencies and streamline its operations, primarily at certain of its foreign subsidiaries. The Company recorded a total of $4.0 million of pre-tax expenses during fiscal 2016 and substantially completed the actions under this initiative as of January 31, 2016. A summary roll forward of costs related to the operating efficiency initiatives and other items is as follows (in thousands): Balance at January 31, 2017 Cash payments Foreign exchange Accrued balance at January 31, 2018 Severance $ 78 $ (1 ) $ 5 $ 82 Occupancy charges 330 (134 ) 12 208 Total $ 408 $ (135 ) $ 17 $ 290 |
Cost Savings Initiatives
Cost Savings Initiatives | 12 Months Ended |
Jan. 31, 2018 | |
Restructuring And Related Activities [Abstract] | |
Cost Savings Initiatives | NOTE 20 – COST SAVINGS INITIATIVES In fiscal 2018, the Company took actions to better align its global infrastructure with the current business environment by consolidating certain operations and streamlining functions to reduce costs and improve profitability. Also, in light of the changing retail landscape and the growing importance of digital marketing and online sales, the Company decided to cease its participation in the Baselworld Watch and Jewelry Show. As a result, the Company recorded $13.6 million of pre-tax expenses primarily for severance and payroll related expenses, fixed assets, other and occupancy charges, predominantly impacting the Company’s North American and Swiss operations. The Company substantially completed the actions under the cost savings initiatives as of January 31, 2018. A summary rollforward of costs related to the cost savings initiatives is as follows (in thousands): Fiscal 2018 Charges (2) Cash payments Non-cash adjustments Foreign exchange Accrued balance at January 31, 2018 Severance and payroll related (1) $ 5,630 $ (5,895 ) $ 1,124 $ 72 $ 931 Fixed assets (1) 5,166 — (5,166 ) — — Other (1) 2,692 (1,847 ) — 74 919 Occupancy charges (1) 99 (34 ) — 9 74 Total $ 13,587 $ (7,776 ) $ (4,042 ) $ 155 $ 1,924 (1) The total severance and payroll related charges of $5.6 million include $4.3 million in SG&A and $1.3 million in Cost of Sales in the Consolidated Statement of Operations for the fiscal year ended January 31, 2018. The fixed assets charges of $5.2 million, other charges of $2.7 million and occupancy charges of $0.1 million are included in SG&A in the Consolidated Statement of Operations for the fiscal year ended January 31, 2018. These accrued balances are located in accrued liabilities in the Company’s Consolidated Balance Sheets. (2) The United States and International locations of the Wholesale segment include a pre-tax charge of $3.9 million and $9.7 million, respectively, for the fiscal year ended January 31, 2018. |
Acquisitions
Acquisitions | 12 Months Ended |
Jan. 31, 2018 | |
Business Combinations [Abstract] | |
Acquisitions | NOTE 21 – ACQUISITIONS On July 3, 2017, the Company, through a wholly-owned U.K. subsidiary, acquired JLB Brands Ltd. (“JLB”), the owner of the Olivia Burton brand, one of the United Kingdom’s fastest growing fashion watch and jewelry brands, for $78.2 million, or £60.0 million in cash, subject to working capital and other closing adjustments. After giving effect to the closing adjustments, the purchase price was $79.0 million, or £60.7 million, net of cash acquired of approximately $5.9 million, or £4.5 million. The acquisition was funded with cash on hand of the Company’s non-U.S. subsidiaries, and no debt was assumed in the acquisition. The acquisition adds a new brand with significant global growth potential to the Company’s portfolio. The results of JLB’s operations have been included in the consolidated financial statements since the date of acquisition within the International location of the Wholesale segment. In the United States and International locations of the Wholesale segment, for the fiscal year ended January 31, 2018, operating income included $0.4 million and $6.4 million, respectively, of expenses primarily related to transaction costs and adjustments in acquisition accounting, as a result of the Company’s purchase of JLB. The acquisition was accounted for in accordance with FASB Topic ASC 805 (“Business Combinations”), which requires that the total cost of an acquisition be allocated to the tangible and intangible assets acquired and liabilities assumed based upon their respective fair values at the date of acquisition. The following table summarizes the fair value of the assets acquired and liabilities assumed as of the July 3, 2017 acquisition date (in thousands): Assets Acquired and Liabilities Assumed Fair Value Cash and cash equivalents $ 5,909 Trade receivables, net 3,106 Inventories 4,164 Prepaid expenses and other current assets 913 Property, plant and equipment, net 131 Goodwill 55,322 Trade name and other intangibles 21,415 Total assets acquired 90,960 Accounts payable 608 Accrued liabilities 844 Income taxes payable 643 Deferred and non-current income taxes payable 3,965 Total liabilities assumed 6,060 Total purchase price $ 84,900 Inventories (as of July 3, 2017) include a step-up adjustment of approximately $0.8 million, which was expensed over the sell-through cycle of three months. The components of Trade name and other intangibles (as of July 3, 2017) include a trade name of approximately $12.8 million (amortized over 10 years), and customer relationships of $8.6 million (amortized over 6 years). The Company recorded goodwill (as of July 3, 2017) of $55.3 million based on the amount by which the purchase price exceeded the fair value of the net assets acquired. Goodwill is not deductible for income tax purposes. The operating results of JLB have been included in the Company’s Consolidated Financial Statements beginning July 3, 2017. Net sales and operating income of JLB since the date of acquisition through January 31, 2018 were $17.8 million and $5.3 million, respectively. JLB’s operating results exclude sales recognized and expenses incurred by certain wholly-owned subsidiaries of the Company in support of the Olivia Burton brand. The following table provides the Company’s unaudited pro forma net sales, net (loss) / income and net (loss) / income per basic and diluted common share as if the results of operations of JLB had been included in the Company’s operations commencing on February 1, 2016, based on available information relating to operations of JLB. This pro forma information is not necessarily indicative either of the combined results of operations that actually would have been realized by the Company had the JLB acquisition been consummated at the beginning of the period for which the pro forma information is presented, or of future results. Fiscal Year Ended January 31, 2018 2017 (In thousands, except per share data) (Unaudited) Net sales $ 579,217 $ 571,321 Net (loss) / income $ (8,992 ) $ 37,851 Basic income per share: Net (loss) / income per share attributed to Movado Group, Inc. $ (0.39 ) $ 1.64 Diluted income per share: Net (loss) / income per share attributed to Movado Group, Inc. $ (0.39 ) $ 1.63 The change in the carrying amount of the Company’s goodwill, which is included in the International location of the Wholesale segment, is as follows (in thousands): Total Balance at January 31, 2017 $ — Acquisition of JLB 55,322 Foreign exchange impact 4,947 Balance at January 31, 2018 $ 60,269 At November 1, 2017, the Company evaluated goodwill for impairment. There were no indicators of impairment under this analysis and, accordingly, no impairment charge was recorded in fiscal 2018. Trade name and other intangible assets consist of the following (in thousands): Fiscal year ended January 31, 2018 Gross carrying amount Accumulated amortization Foreign exchange Net Intangible assets subject to amortization: Trade name $ 12,766 $ (781 ) $ 1,111 $ 13,096 Customer relationships 8,598 (876 ) 735 8,457 Total intangible assets $ 21,364 $ (1,657 ) $ 1,846 $ 21,553 Estimated amortization expense for the next five years is: approximately $2.9 million in fiscal years 2019 through 2023 and approximately $6.6 million in total over the next five years thereafter, ending in fiscal 2028, at prevailing foreign exchange rates. |
Valuation and Qualifying Accoun
Valuation and Qualifying Accounts | 12 Months Ended |
Jan. 31, 2018 | |
Valuation And Qualifying Accounts [Abstract] | |
Valuation and Qualifying Accounts | Schedule II MOVADO GROUP, INC. VALUATION AND QUALIFYING ACCOUNTS (In thousands) Description Balance at Net (benefit) / provision Currency Net write-offs Balance at Year ended January 31, 2018: Doubtful accounts $ 5,499 $ (176) $ 289 $ (1,431 ) $ 4,181 Returns 11,648 30,477 288 (30,054 ) 12,359 Other sales allowances 3,959 9,887 340 (6,842 ) 7,344 Total $ 21,106 $ 40,188 $ 917 $ (38,327 ) $ 23,884 Year ended January 31, 2017: Doubtful accounts $ 4,274 $ 1,739 $ 52 $ (566 ) $ 5,499 Returns 10,856 30,075 10 (29,293 ) 11,648 Other sales allowances 4,179 8,749 (19 ) (8,950 ) 3,959 Total $ 19,309 $ 40,563 $ 43 $ (38,809 ) $ 21,106 Year ended January 31, 2016: Doubtful accounts $ 3,247 $ 2,251 $ (190 ) $ (1,034 ) $ 4,274 Returns 8,736 27,433 (147 ) (25,166 ) 10,856 Other sales allowances 5,068 6,459 (65 ) (7,283 ) 4,179 Total $ 17,051 $ 36,143 $ (402 ) $ (33,483 ) $ 19,309 Description Balance at Net provision Currency Adjustments Balance at Year ended January 31, 2018: Deferred tax asset valuation (1) $ 8,714 $ 628 $ 97 $ (479 ) $ 8,960 Year ended January 31, 2017: Deferred tax asset valuation (2) $ 8,089 $ 716 $ 100 $ (191 ) $ 8,714 Year ended January 31, 2016: Deferred tax asset valuation (3) $ 8,307 $ 986 $ (636 ) $ (568 ) $ 8,089 (1) The detail of adjustments is as follows: (2) The detail of adjustments is as follows: Expiration of tax losses $ (479 ) Prior year adjustments $ 89 $ (479 ) Reversal due to legal entity elimination (280 ) $ (191 ) (3) The detail of adjustments is as follows: Prior year adjustments $ 177 Expired tax losses (745 ) $ (568 ) |
Significant Accounting Polici32
Significant Accounting Policies (Policies) | 12 Months Ended |
Jan. 31, 2018 | |
Accounting Policies [Abstract] | |
Organization and Business | Organization and Business Movado Group, Inc. (together with its subsidiaries, the “Company”) designs, sources, markets and distributes quality watches with prominent brands in almost every price category comprising the watch industry. In fiscal 2018, the Company marketed the following distinct brands of watches: Coach, Concord, Ebel, Scuderia Ferrari, HUGO BOSS, Juicy Couture, Lacoste, Movado, Olivia Burton, Rebecca Minkoff/Uri Minkoff and Tommy Hilfiger. Movado (with the exception of certain Movado collections, including Movado BOLD), Ebel and Concord watches are manufactured in Switzerland by independent third party assemblers and are manufactured using Swiss movements. All of the Company’s products are manufactured using components obtained from third party suppliers. Certain Movado collections of watches, including Movado BOLD, are manufactured by independent contractors in Asia using Swiss movements. Coach, Tommy Hilfiger, HUGO BOSS, Juicy Couture, Lacoste, Olivia Burton, Scuderia Ferrari and Rebecca Minkoff and Uri Minkoff watches are manufactured by independent contractors in Asia. In addition to its sales to trade customers and independent distributors, the Company sells directly to consumers via its e-commerce platforms and also operates retail outlet locations throughout the United States, through which it sells current and discontinued models and factory seconds of all of the Company’s watches. |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. Intercompany transactions and balances have been eliminated. |
Use of Estimates in the Preparation of Financial Statements | Use of Estimates in the Preparation of Financial Statements The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. The Company uses estimates when accounting for sales discounts, returns, allowances and incentives, warranties, income taxes, depreciation, amortization, inventory write-downs, stock-based compensation, contingencies, impairments and asset and liability valuations. |
Translation of Foreign Currency Financial Statements and Foreign Currency Transactions | Translation of Foreign Currency Financial Statements and Foreign Currency Transactions The financial statements of the Company’s international subsidiaries have been translated into United States dollars by translating balance sheet accounts at year-end exchange rates and statement of operations accounts at average exchange rates for the year. Foreign currency transaction gains and losses are charged or credited to earnings as incurred. Foreign currency translation gains and losses are reflected in the equity section of the Company’s consolidated balance sheets in Accumulated Other Comprehensive Income. The balance of the foreign currency translation adjustment, included in Accumulated Other Comprehensive Income, was $100.2 million and $76.6 million as of January 31, 2018 and 2017, respectively. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash equivalents include all highly liquid investments with original maturities at date of purchase of three months or less. |
Trade Receivables | Trade Receivables Trade receivables as shown on the consolidated balance sheets are net of various allowances. The allowance for doubtful accounts is determined through an analysis of the aging of accounts receivable, assessments of collectability based on historical trends, the financial condition of the Company’s customers and an evaluation of economic conditions. The Company writes off uncollectible trade receivables once collection efforts have been exhausted and third parties confirm the balance is not recoverable. The Company’s trade customers include department stores, jewelry store chains and independent jewelers. All of the Company’s watch brands are also marketed outside the U.S. through a network of independent distributors. Accounts receivable are stated net of doubtful accounts, returns and allowances of $21.6 million, $18.9 million and $17.7 million at January 31, 2018, 2017 and 2016, respectively. Additionally, $2.3 million, $2.2 million and $1.6 million of receivables and allowances were recorded in non-current assets as of January 31, 2018, 2017 and 2016, respectively. Accounts receivable are also stated net of co-operative advertising allowances of $9.4 million, $7.8 million, and $9.8 million at January 31, 2018, 2017, and 2016, respectively. Co-operative advertising allowances are credits taken by the customer at a future date on previously executed co-operative advertising. The Company’s concentrations of credit risk arise primarily from accounts receivable related to trade customers during the peak selling seasons. The Company has significant accounts receivable balances due from major national chain and department stores. The Company’s results of operations could be materially adversely affected in the event any of these customers or a group of these customers defaulted on all or a significant portion of their obligations to the Company as a result of financial difficulties. As of January 31, 2018, except for those accounts provided for in the allowance for doubtful accounts, the Company knew of no situations with any of the Company’s major customers which would indicate any such customer’s inability to make its required payments. |
Inventories | Inventories The Company values its inventory at the lower of cost or net realizable value. Cost is determined using the average cost method. The Company performs reviews of its on-hand inventory to determine amounts, if any, of inventory that is deemed discontinued, excess, or unsaleable. Inventory classified as discontinued, together with the related component parts which can be assembled into saleable finished goods, is sold primarily through the Company’s outlet stores. When management determines that finished product is unsaleable, could not be sold at net realizable value or that it is economically impractical to build the excess components into watches for sale, a charge is recorded to value those products and components at the lower of cost or net realizable value. |
Property, Plant and Equipment | Property, Plant and Equipment Property, plant and equipment are stated at cost less accumulated depreciation. Depreciation of buildings is provided using the straight-line method based on the useful life of 40 years. Depreciation of furniture and equipment is provided using the straight-line method based on the estimated useful lives of assets, which range from four to ten years. Computer software is amortized using the straight-line method over the useful life of five to ten years. Leasehold improvements are amortized using the straight-line method over the lesser of the term of the lease or the estimated useful life of the leasehold improvement. Design fees and tooling costs are amortized using the straight-line method based on the useful life of three years. Upon the disposition of property, plant and equipment, the accumulated depreciation is deducted from the original cost and any gain or loss is reflected in operating income. |
Intangibles | Intangibles In accordance with applicable guidance, the Company estimates and records the fair value of purchased intangible assets at the time of their acquisition. The fair values of these intangible assets are estimated based on independent third-party appraisals. Finite-lived intangible assets are amortized over their respective estimated useful lives and are evaluated for impairment periodically and whenever events or changes in circumstances indicate that their related carrying values may not be fully recoverable. Estimates of fair value for finite-lived intangible assets are primarily determined using discounted cash flow analysis of such assets, with consideration of market comparisons and recent transactions. This approach uses significant estimates and assumptions, including projected future cash flows, discount rates and growth rates. Intangible assets consist primarily of a trade name, trademarks and customer relationships and are recorded at cost. These intangible assets are amortized over a range from three to ten years. At January 31, 2018 and 2017, intangible assets at cost were $30.3 million and $8.1 million, respectively, and related accumulated amortization of intangibles was $7.3 million and $6.8 million, respectively. Amortization expense for fiscal 2018, 2017 and 2016 was $2.0 million, $0.4 million and $0.3 million, respectively. |
Goodwill | Goodwill At the time of an acquisition, in accordance with applicable guidance, the Company records all acquired net assets at their estimated fair values. These estimated fair values are based on management’s assessments and independent third-party appraisals. The excess of the purchase consideration over the aggregate estimated fair values of the acquired net assets is recorded as goodwill. Goodwill is not amortized but is assessed for impairment at least annually on November 1 st The quantitative impairment test is performed to measure the amount of impairment loss, if any. The quantitative impairment test identifies the existence of potential impairment by comparing the fair value of each reporting unit with its carrying value, including goodwill. If a reporting unit’s carrying amount exceeds its fair value, the Company will record an impairment charge, as an operating expense item, based on that difference. The impairment charge will be limited to the amount of goodwill allocated to that reporting unit. Determination of the fair value of a reporting unit and the fair value of individual assets and liabilities of a reporting unit is based on management’s assessment, including the consideration of independent third-party appraisals when necessary. Furthermore, this determination is subjective in nature and involves the use of significant estimates and assumptions. These estimates and assumptions could have a significant impact on whether or not an impairment charge is recognized and the amount of any such charge. Estimates of fair value are primarily determined using discounted cash flows, market comparisons, and recent transactions. These approaches use significant estimates and assumptions, including projected future cash flows, discount rates, growth rates, and determination of appropriate market comparisons. At November 1, 2017, the Company evaluated goodwill for impairment. There were no indicators of impairment under this analysis and, accordingly, no impairment charge was recorded in fiscal 2018. The Company had no goodwill in fiscal 2017. |
Long-Lived Assets | Long-Lived Assets The Company periodically reviews the estimated useful lives of its property, plant and equipment and intangible assets based on factors including historical experience, the expected beneficial service period of the asset, the quality and durability of the asset and the Company’s maintenance policy including periodic upgrades. Changes in useful lives are made on a prospective basis unless factors indicate the carrying amounts of the assets may not be recoverable and an impairment write-down is necessary. The Company performs an impairment review of its long-lived assets once events or changes in circumstances indicate, in management’s judgment, that the carrying value of such assets may not be recoverable. When such a determination has been made, management compares the carrying value of the asset groups with their estimated future undiscounted cash flows. If it is determined that an impairment has occurred, the fair value of the asset group is determined and compared to its carrying value. The excess of the carrying value over the fair value, if any, is recognized as loss during that period. The impairment is calculated as the difference between asset carrying values and the fair value of the long-lived assets. |
Deferred Rent Obligations and Contributions from Landlords | Deferred Rent Obligations and Contributions from Landlords The Company accounts for rent expense under non-cancelable operating leases with scheduled rent increases on a straight-line basis over the lease term. The excess of straight-line rent expense over scheduled payments is recorded as a deferred liability in accrued liabilities and other non-current liabilities. In addition, the Company receives build out contributions from landlords primarily as an incentive for the Company to lease retail store space from the landlords. This is also recorded as a deferred liability in accrued liabilities and other non-current liabilities. Such amounts are amortized as a reduction of rent expense over the life of the related lease. |
Capitalized Software Costs | Capitalized Software Costs The Company capitalizes certain computer software costs after technological feasibility has been established. The costs are amortized utilizing the straight-line method over the economic lives of the related products ranging from two to ten years. |
Derivative Financial Instruments | Derivative Financial Instruments The Company accounts for its derivative financial instruments in accordance with the accounting guidance which requires that an entity recognize all derivatives as either assets or liabilities in the statement of financial position and measure those instruments at fair value. A significant portion of the Company’s purchases are denominated in Swiss francs and, to a lesser extent, the Japanese Yen. The Company also sells to third-party customers in a variety of foreign currencies, most notably the Euro and the British Pound. The Company reduces its exposure to the Swiss franc, Euro, British Pound and Japanese Yen exchange rate risks through a hedging program. Under the hedging program, the Company manages most of its foreign currency exposures on a consolidated basis, which allows it to net certain exposures and take advantage of natural offsets. In the event these exposures do not offset, from time to time the Company uses forward contracts to further reduce the net exposures to currency fluctuations. Certain of these contracts meet the requirements of qualified hedges. In these circumstances, the Company designates and documents these derivative instruments as a cash flow hedge of a specific underlying exposure, as well as the risk management objectives and strategies for undertaking the hedge transactions. Changes in the fair value of hedges designated and documented as a cash flow hedge and which are highly effective, are recorded in other comprehensive income until the underlying transaction affects earnings, and then are later reclassified into earnings in the same account as the hedged transaction. The earnings impact is mostly offset by the effects of currency movements on the underlying hedged transactions. The Company formally assesses, both at the inception and at each financial quarter thereafter, the effectiveness of the derivative instrument hedging the underlying forecasted cash flow transaction. The Company does not exclude any designated cash flow hedges from its effectiveness testing. Any ineffectiveness related to the derivative financial instruments’ change in fair value will be recognized as other expense in the Consolidated Statements of Operations in the period in which the ineffectiveness was calculated. The Company uses forward exchange contracts, which do not meet the requirements of qualified hedges, to offset its exposure to certain foreign currency receivables and liabilities. These forward contracts are not designated as qualified hedges and, therefore, changes in the fair value of these derivatives are recognized in earnings in the period they arise, thereby offsetting the current earnings effect resulting from the revaluation of the related foreign currency receivables and liabilities. All of the Company’s derivative instruments have liquid markets to assess fair value. The Company does not enter into any derivative instruments for trading purposes. |
Revenue Recognition | Revenue Recognition In the Wholesale segment, the Company recognizes its revenues upon transfer of title and risk of loss in accordance with its terms of sale and after the sales price is fixed and determinable and collectability is reasonably assured. In the Retail segment, transfer of title and risk of loss occurs at the time of register receipt. The Company records estimates for sales returns, volume-based programs and sales and cash discount allowances as a reduction of revenue in the same period that the sales are recorded. These estimates are based upon historical analysis, customer agreements and/or currently known factors that arise in the normal course of business. While returns have historically been within the Company’s expectations and the provisions established, future return rates may differ from those experienced in the past. Taxes imposed by governmental authorities on the Company's revenue-producing activities with customers, such as sales taxes and value added taxes, are excluded from net sales. The Company’s sale of smart watches contains multiple deliverables. The first deliverable is the watch along with the software essential to the functionality of the watch delivered at the time of sale. The second deliverable is the software included free of charge that enables users to sync and view data on the Company’s mobile app. The third deliverable is the embedded right included with the purchase to receive unspecified firmware and software upgrades, when and if available. The Company allocates revenue to all deliverables using the relative selling price method. Amounts allocated to the delivered smart watch collections and the related essential software are recognized at the time of sale. Amounts allocated to the cloud service and app updates are deferred and recognized on a straight-line basis over the estimated two-year period the updates are expected to be provided. The Company’s smart watch collections were available in limited quantities and in limited distribution, and, as a result, these deferred amounts were immaterial as of January 31, 2018, 2017 and 2016, respectively. |
Cost of Sales | Cost of Sales Cost of sales of the Company’s products consist primarily of costs for raw materials, component costs, royalties, depreciation, amortization, assembly costs, design costs and unit overhead costs associated with the Company’s supply chain operations predominately in Switzerland and Asia. The Company’s supply chain operations consist of logistics management of assembly operations and product sourcing predominately in Switzerland and Asia and minor assembly in Switzerland. |
Selling, General and Administrative ("SG&A") Expenses | Selling, General and Administrative (“SG&A”) Expenses The Company’s SG&A expenses consist primarily of marketing, selling, distribution, general and administrative expenses. Marketing expenditures are based principally on overall strategic considerations relative to maintaining or increasing market share in markets that management considers to be crucial to the Company’s continued success as well as on general economic conditions in the various markets around the world in which the Company sells its products. Marketing expenses include salaries, various forms of media advertising, digital advertising and co-operative advertising with customers and distributors and other point of sale marketing and promotion spending. Selling expenses consist primarily of salaries, sales commissions, sales force travel and related expenses, depreciation and amortization, expenses associated with Baselworld Watch and Jewelry Show, the annual watch and jewelry trade show, and other industry trade shows and operating costs incurred in connection with the Company’s retail business. Sales commissions vary with overall sales levels. Retail selling expenses consist primarily of payroll and related expenses and store occupancy costs. Distribution expenses consist primarily of salaries of distribution staff, rental and other occupancy costs, security, depreciation and amortization of furniture and leasehold improvements and shipping supplies. General and administrative expenses consist primarily of salaries and other employee compensation including performance based compensation, employee benefit plan costs, office rent, management information systems costs, professional fees, bad debts, depreciation and amortization of furniture, computer software and leasehold improvements, patent and trademark expenses and various other general corporate expenses. |
Warranty Costs | Warranty Costs All watches sold by the Company come with limited warranties covering the movement against defects in material and workmanship for periods ranging from two to three years from the date of purchase, with the exception of Tommy Hilfiger watches, for which the warranty period is ten years. In addition, the warranty period is five years for the gold plating for Movado watch cases and bracelets. When changes in warranty costs are experienced, the Company will adjust the warranty liability as required. The Company records an estimate for future warranty costs based on historical repair costs. Warranty costs have historically been within the Company’s expectations and the provisions established. Warranty liability for the fiscal years ended January 31, 2018, 2017 and 2016 was as follows (in thousands): 2018 2017 2016 Balance, beginning of year $ 2,728 $ 2,556 $ 2,710 Provision charged to operations 2,845 2,092 1,630 Settlements made (2,285 ) (1,920 ) (1,784 ) Balance, end of year $ 3,288 $ 2,728 $ 2,556 |
Pre-opening Costs | Pre-opening Costs Marketing and administrative costs associated with the opening of retail stores are expensed in the period incurred. |
Marketing | Marketing The Company expenses the production costs of an advertising campaign at the commencement date of the advertising campaign. Included in marketing expenses are costs associated with co-operative advertising, media advertising, digital advertising, production costs and costs of point of sale materials and displays. These costs are recorded as SG&A expenses. The Company participates in co-operative advertising programs on a voluntary basis and receives a “separately identifiable benefit in exchange for the consideration.” Since the amount of consideration paid to the retailer does not exceed the fair value of the benefit received by the Company, these costs are recorded as SG&A expenses as opposed to being recorded as a reduction of revenue. Marketing expense for fiscal 2018, 2017 and 2016 was $73.1 million, $75.7 million and $77.6 million, respectively. Included in other current assets and non-current assets in the consolidated balance sheets are the costs of certain prepaid advertising, including principally product displays and point of sale materials and to a lesser extent licensing agreements and sponsorships. Prepaid advertising accounted for in other current assets for the years ended January 31, 2018 and 2017, respectively. Prepaid advertising accounted for in other non-current assets for the years ended January 31, 2018 and 2017, respectively. |
Shipping and Handling Costs | Shipping and Handling Costs Amounts charged to customers for shipping and handling were $1.8 million, $1.9 million and $2.2 million for fiscal years 2018, 2017 and 2016, respectively. The costs related to shipping and handling were $5.2 million, $5.6 million and $6.5 million for fiscal years 2018, 2017 and 2016, respectively. These amounts incurred by the Company related to shipping and handling are included in net sales and cost of goods sold. |
Collaborative Arrangement | Collaborative Arrangement The Company participates in a collaborative arrangement with Rebecca Minkoff, LLC relating to the Rebecca Minkoff and Uri Minkoff brand names. Both parties to the arrangement are active participants in the collaboration and are exposed to significant risks and rewards dependent on the commercial success of the activities. The arrangement involves various activities including the design, development, distribution and marketing of watches under the brand names. Amounts due between the parties to the arrangement related to sales and related activities are recorded in the Company’s cost of sales while those amounts related to general and administrative activities are recorded as an adjustment to selling, general and administrative expenses. The Company generated immaterial revenues and incurred immaterial expenses under its collaborative arrangement during fiscal 2018. |
Income Taxes | Income Taxes The Company, under the guidance for Income Taxes (“ASC Topic 740”), follows the asset and liability method of accounting for income taxes under which deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax laws and tax rates, in each jurisdiction where the Company operates, and applied to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities due to a change in tax rates is recognized in income in the period that includes the enactment date. In addition, the amounts of any future tax benefits are reduced by a valuation allowance to the extent such benefits are not expected to be realized on a more-likely-than-not basis. The Company calculates estimated income taxes in each of the jurisdictions in which it operates. This process involves estimating actual current tax expense along with assessing temporary differences resulting from differing treatment of items for both book and tax purposes. The Company follows guidance for accounting for uncertainty in income taxes. This guidance clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold and measurement standard for the financial statement recognition and measurement of an income tax position taken or expected to be taken in a tax return. This guidance also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosures and transitions. The Tax Cuts and Jobs Act (“2017 Tax Act”) that was signed into law on December 22, 2017 constitutes a major change to the US tax system. The 2017 Tax Act significantly changed the existing U.S. corporate income tax laws by, among other things, lowering the corporate tax rate from 35% to 21%, limiting the deductibility of interest expense and executive compensation, implementing a territorial tax system, and imposing a one-time mandatory deemed repatriation transition tax (“Transition Tax”) on cumulative undistributed foreign earnings which have not been previously taxed. The SEC issued Staff Accounting Bulletin No. 118 (“SAB 118”) which allows the Company to record provisional amounts related to the 2017 Tax Act and provides a measurement period of up to one year from the enactment date for companies to complete their accounting under ASC Topic 740. The Company has not completed its full analysis with respect to the Global Intangible Low Taxed Income (“GILTI”) provision within the 2017 Tax Act which would require the current inclusion in federal taxable income of earnings of certain foreign controlled corporations. The Company is not yet able to make reasonable estimates of the tax impact of GILTI; therefore, it has not yet elected a policy as to whether it will recognize deferred taxes for basis differences expected to reverse as GILTI, or whether the Company will account for GILTI as period costs if and when incurred. The Company will continue to evaluate these provisions and elect an accounting policy within the measurement period. The Company early adopted ASU 2018-02, “Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income” which permits companies to reclassify disproportionate tax effects in accumulated other comprehensive income caused by the 2017 Tax Act to retained earnings. As a result, the Company made the election to reclassify the income tax effects of the 2017 Tax Act from AOCI to retained earnings in the current year. The adoption of this standard did not have a material impact on the Company’s consolidated results of operations or financial position. |
Retail Comparable Stores | Retail Comparable Stores The Company considers comparable outlet store sales to be sales of stores that were open as of February 1 st st |
Earnings Per Share | Earnings Per Share The Company presents net income per share on a basic and diluted basis. Basic earnings per share is computed using weighted-average shares outstanding during the period. Diluted earnings per share is computed using the weighted-average number of shares outstanding adjusted for dilutive common stock equivalents. The weighted-average number of shares outstanding for basic earnings per share were approximately 23,073,000, 23,070,000 and 23,525,000 for fiscal 2018, 2017 and 2016, respectively. For the fiscal year ended January 31, 2018, the number of shares outstanding for diluted earnings per share was the same as the basic earnings per share because the Company generated a net loss. For the fiscal years ended January 31, 2017 and 2016, the number of shares outstanding for diluted earnings per share were approximately 23,267,000 and 23,774,000, respectively. For the fiscal years ended January 31, 2017 and 2016, the number of shares outstanding for diluted earnings per share included approximately 197,000 and 249,000 due to potentially dilutive common stock equivalents issuable under the Company’s stock compensation plans. For the fiscal years ended January 31, 2018, 2017 and 2016 approximately 994,000, 785,000 and 637,000, respectively, of potentially dilutive common stock equivalents were excluded from the computation of diluted earnings per share because their effect would have been antidilutive. |
Stock-Based Compensation | Stock-Based Compensation Under the accounting guidance for share-based payments, the Company utilizes the Black-Scholes option-pricing model which requires that certain assumptions be made to calculate the fair value of each option at the grant date. The expected life of stock option grants is determined using historical data and represents the time period during which the stock option is expected to be outstanding until it is exercised. The risk free interest rate is the yield on the grant date of U.S. Treasury constant maturities with a maturity date closest to the expected life of the stock option. The expected stock price volatility is derived from historical volatility and calculated based on the estimated term structure of the stock option grant. The expected dividend yield is calculated using the Company’s historical average of annualized dividend yields and applied over the expected term of the option. Compensation expense for equity instruments is accrued based on the estimated number of instruments for which the requisite service is expected to be rendered and expensed on a straight-line basis over the vesting term. |
Significant Accounting Polici33
Significant Accounting Policies (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Accounting Policies [Abstract] | |
Schedule of Warranty Liability | Warranty liability for the fiscal years ended January 31, 2018, 2017 and 2016 was as follows (in thousands): 2018 2017 2016 Balance, beginning of year $ 2,728 $ 2,556 $ 2,710 Provision charged to operations 2,845 2,092 1,630 Settlements made (2,285 ) (1,920 ) (1,784 ) Balance, end of year $ 3,288 $ 2,728 $ 2,556 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Inventory Disclosure [Abstract] | |
Components of Inventories | Inventories consisted of the following (in thousands): As of January 31, 2018 2017 Finished goods $ 112,712 $ 112,297 Component parts 37,404 38,482 Work-in-process 1,560 2,388 $ 151,676 $ 153,167 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Property Plant And Equipment [Abstract] | |
Schedule of Property, Plant and Equipment | Property, plant and equipment, at cost, consisted of the following (in thousands): As of January 31, 2018 2017 Land and buildings $ 1,610 $ 1,490 Furniture and equipment 48,748 59,163 Computer software 32,359 32,077 Leasehold improvements 32,814 32,307 Design fees and tooling costs 2,398 1,787 117,929 126,824 Less: accumulated depreciation (93,258 ) (92,651 ) $ 24,671 $ 34,173 |
Derivative Financial Instrume36
Derivative Financial Instruments (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Fair Value and Presentation of Derivatives | The following table summarizes the fair value and presentation in the Consolidated Balance Sheets for derivatives as of January 31, 2018 and 2017 (in thousands): Asset Derivatives Liability Derivatives Balance 2018 2017 Balance 2018 2017 Derivatives not designated as hedging instruments: Foreign Exchange Contracts Other Current $ 544 $ 145 Accrued Liabilities $ 2 $ 211 Total Derivative Instruments $ 544 $ 145 $ 2 $ 211 Asset Derivatives Liability Derivatives Balance 2018 2017 Balance 2018 2017 Derivatives designated as hedging instruments: Foreign Exchange Contracts Other Current $ — $ — Accrued Liabilities $ 44 $ — Total Derivative Instruments $ — $ — $ 44 $ — |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Abstract] | |
Assets and Liabilities Measured at Fair Value on Recurring Basis | The following tables present the fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis as of January 31, 2018 and 2017 (in thousands): Fair Value at January 31, 2018 Balance Sheet Location Level 1 Level 2 Level 3 Total Assets: Available-for-sale securities Other current assets $ 275 $ — $ — $ 275 Short-term investment Other current assets 164 — — 164 SERP assets - employer Other non-current assets 994 — — 994 SERP assets - employee Other non-current assets 38,577 — — 38,577 Hedge derivatives Other current assets — 544 — 544 Total $ 40,010 $ 544 $ — $ 40,554 Liabilities: SERP liabilities - employee Other non-current liabilities $ 38,577 $ — $ — $ 38,577 Hedge derivatives Accrued liabilities — 46 — 46 Total $ 38,577 $ 46 $ — $ 38,623 Fair Value at January 31, 2017 Balance Sheet Location Level 1 Level 2 Level 3 Total Assets: Available-for-sale securities Other current assets $ 309 $ — $ — $ 309 Short-term investment Other current assets 154 154 SERP assets - employer Other non-current assets 1,091 — — 1,091 SERP assets - employee Other non-current assets 30,831 — — 30,831 Hedge derivatives Other current assets — 145 — 145 Total $ 32,385 $ 145 $ — $ 32,530 Liabilities: SERP liabilities - employee Other non-current liabilities $ 30,831 $ — $ — $ 30,831 Hedge derivatives Accrued liabilities — 211 — 211 Total $ 30,831 $ 211 $ — $ 31,042 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income before Provision for Income Taxes | Income before provision for income taxes on a legal entity basis consists of the following (in thousands): 2018 2017 2016 U.S. income before taxes $ 11,731 $ 26,299 $ 44,384 Non-U.S. income before taxes 30,411 25,155 24,741 Income before income taxes $ 42,142 $ 51,454 $ 69,125 |
Schedule of Income Taxes Provision for Continuing Operations | The provision for income taxes for the fiscal years ended January 31, 2018, 2017 and 2016 consists of the following components (in thousands): 2018 2017 2016 Current: U.S. Federal $ 31,599 $ 14,079 $ 17,776 U.S. State and Local 960 1,117 1,434 Non-U.S. 7,145 5,091 5,291 39,704 20,287 24,501 Deferred: U.S. Federal 16,671 (4,231 ) (1,995 ) U.S. State and Local 622 (167 ) (228 ) Non-U.S. 370 426 1,082 17,663 (3,972 ) (1,141 ) Provision for income taxes $ 57,367 $ 16,315 $ 23,360 |
Schedule of Significant Components of Deferred Income Tax Assets and Liabilities | Significant components of the Company’s deferred income tax assets and liabilities as of January 31, 2018 and 2017 are as follows (in thousands): 2018 Deferred Taxes 2017 Deferred Taxes Assets Liabilities Assets Liabilities Net operating loss carryforwards $ 10,589 $ — $ 10,516 $ — Inventory 2,199 — 3,782 — Unprocessed returns 955 — 1,200 — Receivables allowances 227 — 1,151 — Deferred compensation 12,985 — 18,955 — Unrepatriated earnings — 11,690 — 2,956 Capital loss carryforwards — — 389 — Depreciation/amortization — 4,440 — 1,245 Other provisions/accruals 63 — 207 — Miscellaneous — 199 955 — 27,018 16,329 37,155 4,201 Valuation allowance (8,960 ) — (8,714 ) — Total deferred tax assets and liabilities $ 18,058 $ 16,329 $ 28,441 $ 4,201 |
Schedule of Income Taxes Provision for Continuing Operations by Applying U.S. Federal Statutory Rate | The provision for income taxes differs from the U.S. federal statutory rate due to the following (in thousands): Fiscal Year Ended January 31, 2018 2017 2016 Provision for income taxes at the U.S. statutory rate $ 14,248 $ 18,009 $ 24,194 Lower effective non-U.S. income tax rate (4,378 ) (4,725 ) (4,463 ) Change in valuation allowance 136 828 986 U.S. tax provided on earnings of non-U.S. subsidiaries — 541 1,029 Change in liabilities for uncertain tax positions, net (381 ) 215 (98 ) State and local taxes, net of federal benefit 626 617 1,234 Impact of 2017 Tax Act 45,002 — — Excess tax deficiencies from stock-based compensation 1,094 — — Non-deductible acquisition costs 786 — — Other, net 234 830 478 Total provision for income taxes $ 57,367 $ 16,315 $ 23,360 |
Schedule of Reconciliation of Beginning and Ending Amounts of Gross Unrecognized Tax Benefits | A reconciliation of the beginning and ending amounts of gross unrecognized tax benefits (exclusive of interest) for the fiscal years ended January 31, 2018, 2017 and 2016 are as follows (in thousands): 2018 2017 2016 Beginning balance $ 2,619 $ 2,481 $ 2,657 Additions for tax positions taken in the current year 180 142 175 Tax positions taken in prior years 148 — — Lapse of statute of limitations (630 ) — (311 ) Settlements (149 ) — — Non U.S. currency exchange fluctuations 186 (4 ) (40 ) Ending balance $ 2,354 $ 2,619 $ 2,481 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Leases [Abstract] | |
Schedule of Minimum Annual Rentals under Noncancelable Operating Leases | Minimum annual rentals under noncancelable operating leases as of January 31, 2018, excluding real estate taxes and operating costs, are as follows (in thousands): Fiscal Year Ending January 31, 2019 $ 11,607 2020 7,490 2021 7,041 2022 6,245 2023 5,563 Thereafter 28,234 $ 66,180 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Schedule of Transactions for Stock Options Under Plan | Transactions for stock options under the Plan since fiscal 2015 are summarized as follows: Outstanding Weighted- January 31, 2015 616,220 $ 30.08 Options granted 126,880 $ 30.36 Options exercised (28,450 ) $ 21.49 Options cancelled (15,050 ) $ 33.32 January 31, 2016 699,600 $ 30.41 Options granted 200,346 $ 26.97 Options exercised (40,588 ) $ 25.68 Options cancelled — $ — January 31, 2017 859,358 $ 29.83 Options granted 161,205 $ 23.35 Options exercised (85,600 ) $ 23.18 Options cancelled (173,262 ) $ 30.21 January 31, 2018 761,701 $ 29.12 |
Schedule of Outstanding and Exercisable Stock Options | The following table summarizes outstanding and exercisable stock options as of January 31, 2018: Range of Exercise Prices Number Weighted- Weighted- Number Weighted- $21.03 - $24.02 161,955 9.2 $ 23.34 750 $ 22.04 $24.03 - $27.02 166,012 4.2 $ 26.59 166,012 $ 26.59 $27.03 - $30.02 140,811 8.2 $ 27.74 — $ — $30.03 - $33.02 189,770 6.1 $ 30.35 124,540 $ 30.34 $33.03 - $42.02 19,853 6.4 $ 40.52 19,853 $ 40.52 $42.03 - $45.02 83,300 6.2 $ 42.12 83,300 $ 42.12 761,701 6.3 $ 29.12 394,455 $ 31.75 |
Schedule of Transactions for Restricted Stock Units Under Plan | Transactions for stock award units under the Plan since fiscal 2015 are summarized as follows: Number of Stock Award Weighted- January 31, 2015 337,356 $ 34.72 Units granted 136,310 $ 29.48 Units vested (83,578 ) $ 29.99 Units forfeited (15,490 ) $ 35.70 January 31, 2016 374,598 $ 33.83 Units granted 187,777 $ 27.76 Units vested (170,010 ) $ 31.85 Units forfeited (11,207 ) $ 34.50 January 31, 2017 381,158 $ 31.71 Units granted 133,245 $ 23.31 Units vested (115,574 ) $ 39.44 Units forfeited (56,059 ) $ 30.27 January 31, 2018 342,770 $ 26.07 |
Accumulated Other Comprehensi41
Accumulated Other Comprehensive Income (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Accumulated Other Comprehensive Income Loss Net Of Tax [Abstract] | |
Schedule of Components of Accumulated Other Comprehensive Income | The components of accumulated other comprehensive income at January 31, consisted of the following (in thousands): Currency Translation Available- Hedging Total Balance, January 31, 2017 $ 76,569 $ 197 $ 14 $ 76,780 Other comprehensive income / (loss) before 23,621 (6 )* 874 24,489 Amounts reclassified from — — (926 ) (926 ) Net current-period other 23,621 (6 ) (52 ) 23,563 Balance, January 31, 2018 $ 100,190 $ 191 $ (38 ) $ 100,343 Currency Translation Available- Hedging Total Balance, January 31, 2016 $ 68,265 $ 189 $ 51 $ 68,505 Other comprehensive income / (loss) before 8,389 8 (408 ) 7,989 Amounts reclassified from (85 ) — 371 286 Net current-period other 8,304 8 (37 ) 8,275 Balance, January 31, 2017 $ 76,569 $ 197 $ 14 $ 76,780 * Includes approximately twenty-one thousand dollars related to the tax effect of the tax rate change on marketable securities (see Note 7 – Income Taxes). (1) Amounts in fiscal 2018 and 2017 were reclassified to operating income in the Consolidated Statements of Operations. |
Segment and Geographic Inform42
Segment and Geographic Information (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Segment Reporting [Abstract] | |
Operating Segment Data | Operating Segment Data as of and for the Fiscal Year Ended January 31, (in thousands): Net Sales (5) 2018 2017 2016 Wholesale: Owned brands category $ 204,897 $ 205,396 $ 219,012 Licensed brands category 277,323 265,137 297,227 After-sales service and all other 9,862 13,911 13,770 Total Wholesale 492,082 484,444 530,009 Retail 75,871 68,308 64,914 Consolidated total $ 567,953 $ 552,752 $ 594,923 Operating Income 2018 2017 2016 Wholesale $ 28,296 $ 41,773 $ 58,242 Retail 14,904 12,208 11,865 Consolidated total $ 43,200 $ 53,981 $ 70,107 Total Assets Capital Expenditures 2018 2017 2018 2017 2016 Wholesale $ 621,965 $ 584,518 $ 3,133 $ 5,666 $ 5,902 Retail 23,415 23,284 2,677 254 2,168 Consolidated total $ 645,380 $ 607,802 $ 5,810 $ 5,920 $ 8,070 Depreciation and Amortization 2018 2017 2016 Wholesale $ 11,765 $ 9,875 $ 11,561 Retail 1,692 1,632 1,595 Consolidated total $ 13,457 $ 11,507 $ 13,156 |
Geographic Segment Data | Geographic Location Data as of and for the Fiscal Year Ended January 31, (in thousands): Net Sales (5) Operating (Loss) / Income 2018 2017 2016 2018 2017 2016 United States $ 260,606 $ 296,311 $ 326,206 $ (629) $ 16,917 $ 29,867 International 307,347 256,441 268,717 43,829 37,064 40,240 Consolidated total $ 567,953 $ 552,752 $ 594,923 $ 43,200 $ 53,981 $ 70,107 Total Assets Property, Plant and Equipment, Net 2018 2017 2018 2017 United States $ 188,346 $ 207,246 $ 16,570 $ 19,197 International 457,034 400,556 8,101 14,976 Consolidated total $ 645,380 $ 607,802 $ 24,671 $ 34,173 (1) Fiscal 2018 Wholesale and United States and International operating (loss) / income included a charge of $6.8 million related to transaction charges and the amortization of acquisition accounting adjustments associated with the purchase of the Olivia Burton brand. (2) Fiscal 2018 Wholesale and United States and International operating (loss) / income included a charge of $13.6 million as part of the Company’s cost savings initiatives. In fiscal 2018, the Company took actions to better align its global infrastructure with the current business environment by consolidating certain operations and streamlining functions to reduce costs and improve profitability. Also, in light of the changing retail landscape and the growing importance of digital marketing and online sales, the Company decided to cease its participation in the Baselworld Watch and Jewelry Show. (3) Fiscal 2017 Wholesale and United States operating income included a pre-tax charge of $1.8 million, as a result of the immediate vesting of stock awards and certain other compensation related to the announcement of the retirement of the Company’s former Vice Chairman and Chief Operating Officer, in fiscal 2017. ( 4 ) Fiscal 2016 Wholesale and United States and International operating income included a $4.0 million charge as a result of actions taken by the Company in fiscal 2016 to achieve greater operating efficiencies and streamline its operations. ( 5 ) The United States and International net sales are net of intercompany sales of $268.1 million, $289.2 million and $309.1 million for the fiscal years ended January 31, 2018, 2017 and 2016, respectively. (6 ) The United States operating income included $25.2 million, $26.3 million and $27.0 million of unallocated corporate expenses for the fiscal years ended January 31, 2018, 2017 and 2016, respectively. (7 ) The International operating income included $41.5 million, $40.0 million and $44.5 million of certain intercompany profits related to the Company’s supply chain operations for the fiscal years ended January 31, 2018, 2017 and 2016, respectively. |
Quarterly Financial Data (Una43
Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Unaudited Selected Interim Operating Results | The following table presents unaudited selected interim operating results of the Company for fiscal 2018 and 2017 (in thousands, except per share amounts): Quarter 1 st 2 nd 3 rd 4 th Fiscal 2018 Net sales $ 99,265 $ 128,781 $ 190,693 $ 149,214 Gross profit $ 49,137 $ 66,126 $ 104,070 $ 78,745 (Loss) / Income before income taxes $ (3,882 ) $ 8,056 $ 24,850 $ 13,118 Net (loss) / income attributed to Movado Group, Inc. $ (4,159 ) $ 5,482 $ 17,360 $ (33,908 ) Basic income per share: Net (loss) / income attributed to Movado Group, Inc. $ (0.18 ) $ 0.24 $ 0.75 $ (1.47 ) Diluted income per share: Net (loss) / income attributed to Movado Group, Inc. $ (0.18 ) $ 0.24 $ 0.75 $ (1.47 ) Fiscal 2017 Net sales $ 114,063 $ 128,086 $ 179,818 $ 130,785 Gross profit $ 61,317 $ 70,263 $ 98,550 $ 64,687 Income before income taxes $ 5,060 $ 9,796 $ 29,501 $ 7,097 Net income $ 3,337 $ 6,355 $ 20,215 $ 5,232 Net income attributed to Movado Group, Inc. $ 3,308 $ 6,306 $ 20,215 $ 5,232 Basic income per share: Net income attributed to Movado Group, Inc. $ 0.14 $ 0.27 $ 0.88 $ 0.23 Diluted income per share: Net income attributed to Movado Group, Inc. $ 0.14 $ 0.27 $ 0.87 $ 0.22 |
Supplemental Cash Flow Inform44
Supplemental Cash Flow Information (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Supplemental Cash Flow Elements [Abstract] | |
Schedule of Supplemental Information to Consolidated Statements of Cash Flows | The following is provided as supplemental information to the consolidated statements of cash flows (in thousands): Fiscal Year Ended January 31, 2018 2017 2016 Cash paid during the year for: Interest $ 1,223 $ 1,121 $ 797 Income taxes, net $ 20,366 $ 22,768 $ 22,500 Supplemental disclosures of non-cash investing activities: Additions to property, plant and equipment included in accrued liabilities $ — $ 4 $ — |
Net (Loss) _ Income Attribut45
Net (Loss) / Income Attributed to Movado Group, Inc. and Transfers to Noncontrolling Interest (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Net Income Attributable To Group And Transfers To Noncontrolling Interest [Abstract] | |
Net (Loss) / Income Attributed to Movado Group, Inc. and Transfers to Noncontrolling Interest | For Fiscal Year Ended January 31, 2018 2017 2016 Net (loss) / income attributed to Movado Group, Inc. $ (15,225 ) $ 35,061 $ 45,094 Transfers to the noncontrolling interest Decrease in Movado Group, Inc.’s paid-in capital for purchase of joint venture common shares — (1,011 ) (3,613 ) Net transfers to noncontrolling interest — (1,011 ) (3,613 ) Change from net (loss) / income attributed to Movado Group, Inc. and transfers to noncontrolling interest $ (15,225 ) $ 34,050 $ 41,481 |
Operating Efficiency Initiati46
Operating Efficiency Initiatives and Other Items (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Restructuring And Related Activities [Abstract] | |
Summary of Costs Related to Operating Efficiency Initiatives and Other Items | A summary roll forward of costs related to the operating efficiency initiatives and other items is as follows (in thousands): Balance at January 31, 2017 Cash payments Foreign exchange Accrued balance at January 31, 2018 Severance $ 78 $ (1 ) $ 5 $ 82 Occupancy charges 330 (134 ) 12 208 Total $ 408 $ (135 ) $ 17 $ 290 |
Cost Savings Initiatives (Table
Cost Savings Initiatives (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Restructuring And Related Activities [Abstract] | |
Summary of Costs Related to Cost Savings Initiatives | A summary rollforward of costs related to the cost savings initiatives is as follows (in thousands): Fiscal 2018 Charges (2) Cash payments Non-cash adjustments Foreign exchange Accrued balance at January 31, 2018 Severance and payroll related (1) $ 5,630 $ (5,895 ) $ 1,124 $ 72 $ 931 Fixed assets (1) 5,166 — (5,166 ) — — Other (1) 2,692 (1,847 ) — 74 919 Occupancy charges (1) 99 (34 ) — 9 74 Total $ 13,587 $ (7,776 ) $ (4,042 ) $ 155 $ 1,924 (1) The total severance and payroll related charges of $5.6 million include $4.3 million in SG&A and $1.3 million in Cost of Sales in the Consolidated Statement of Operations for the fiscal year ended January 31, 2018. The fixed assets charges of $5.2 million, other charges of $2.7 million and occupancy charges of $0.1 million are included in SG&A in the Consolidated Statement of Operations for the fiscal year ended January 31, 2018. These accrued balances are located in accrued liabilities in the Company’s Consolidated Balance Sheets. (2) The United States and International locations of the Wholesale segment include a pre-tax charge of $3.9 million and $9.7 million, respectively, for the fiscal year ended January 31, 2018. |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Business Combinations [Abstract] | |
Summary of Fair Value of Assets Acquired and Liabilities Assumed at Acquisition Date | The following table summarizes the fair value of the assets acquired and liabilities assumed as of the July 3, 2017 acquisition date (in thousands): Assets Acquired and Liabilities Assumed Fair Value Cash and cash equivalents $ 5,909 Trade receivables, net 3,106 Inventories 4,164 Prepaid expenses and other current assets 913 Property, plant and equipment, net 131 Goodwill 55,322 Trade name and other intangibles 21,415 Total assets acquired 90,960 Accounts payable 608 Accrued liabilities 844 Income taxes payable 643 Deferred and non-current income taxes payable 3,965 Total liabilities assumed 6,060 Total purchase price $ 84,900 |
Summary of Unaudited Pro Forma Information | The following table provides the Company’s unaudited pro forma net sales, net (loss) / income and net (loss) / income per basic and diluted common share as if the results of operations of JLB had been included in the Company’s operations commencing on February 1, 2016, based on available information relating to operations of JLB. This pro forma information is not necessarily indicative either of the combined results of operations that actually would have been realized by the Company had the JLB acquisition been consummated at the beginning of the period for which the pro forma information is presented, or of future results. Fiscal Year Ended January 31, 2018 2017 (In thousands, except per share data) (Unaudited) Net sales $ 579,217 $ 571,321 Net (loss) / income $ (8,992 ) $ 37,851 Basic income per share: Net (loss) / income per share attributed to Movado Group, Inc. $ (0.39 ) $ 1.64 Diluted income per share: Net (loss) / income per share attributed to Movado Group, Inc. $ (0.39 ) $ 1.63 |
Summary of Company's Goodwill by Segment | The change in the carrying amount of the Company’s goodwill, which is included in the International location of the Wholesale segment, is as follows (in thousands): Total Balance at January 31, 2017 $ — Acquisition of JLB 55,322 Foreign exchange impact 4,947 Balance at January 31, 2018 $ 60,269 |
Summary of Trade Name and Other Intangible Assets | Trade name and other intangible assets consist of the following (in thousands): Fiscal year ended January 31, 2018 Gross carrying amount Accumulated amortization Foreign exchange Net Intangible assets subject to amortization: Trade name $ 12,766 $ (781 ) $ 1,111 $ 13,096 Customer relationships 8,598 (876 ) 735 8,457 Total intangible assets $ 21,364 $ (1,657 ) $ 1,846 $ 21,553 |
Significant Accounting Polici49
Significant Accounting Policies (Details Textual) | 1 Months Ended | 11 Months Ended | 12 Months Ended | ||
Jan. 31, 2018USD ($)Store | Dec. 31, 2017 | Jan. 31, 2018USD ($)Storeshares | Jan. 31, 2017USD ($)shares | Jan. 31, 2016USD ($)shares | |
Significant Accounting Policies [Line Items] | |||||
Accumulated other comprehensive income, foreign currency translation adjustment | $ 100,200,000 | $ 100,200,000 | $ 76,600,000 | ||
Maturity date | 3 months | ||||
Accounts receivable, net of doubtful accounts, returns and allowances | $ 21,600,000 | 18,900,000 | $ 17,700,000 | ||
Additional accounts receivables and allowances recorded in non-current assets | 2,300,000 | 2,300,000 | 2,200,000 | 1,600,000 | |
Accounts receivable net of co operative advertising allowances | 9,400,000 | 9,400,000 | 7,800,000 | 9,800,000 | |
Intangible assets at cost | 30,300,000 | 30,300,000 | 8,100,000 | ||
Accumulated amortization of intangibles | 7,300,000 | 7,300,000 | 6,800,000 | ||
Amortization expense | 2,000,000 | 400,000 | 300,000 | ||
Goodwill, impairment charge | 0 | ||||
Goodwill | $ 60,269,000 | $ 60,269,000 | 0 | ||
Deferred revenue expected to be recognized, period | 2 years | ||||
Marketing expenses | $ 73,100,000 | 75,700,000 | 77,600,000 | ||
Shipping and handling customers charges | 1,800,000 | 1,900,000 | 2,200,000 | ||
Shipping, handling and transportation costs | $ 5,200,000 | $ 5,600,000 | $ 6,500,000 | ||
Corporate income tax rate | 21.00% | 35.00% | |||
Number of outlet stores | Store | 37 | 37 | |||
Weighted basic average shares outstanding | shares | 23,073,000 | 23,070,000 | 23,525,000 | ||
Number of shares outstanding for diluted earnings per share | shares | 23,073,000 | 23,267,000 | 23,774,000 | ||
Number of shares included in outstanding for diluted earnings per share | shares | 197,000 | 249,000 | |||
Dilutive common stock equivalents were excluded from the computation of dilutive earnings per share | shares | 994,000 | 785,000 | 637,000 | ||
Other Current Assets | |||||
Significant Accounting Policies [Line Items] | |||||
Prepaid advertising cost | $ 6,100,000 | $ 6,100,000 | $ 6,200,000 | ||
Other Non-Current Assets | |||||
Significant Accounting Policies [Line Items] | |||||
Prepaid advertising cost | $ 1,700,000 | $ 1,700,000 | 3,100,000 | ||
Tommy Hilfiger Watches | |||||
Significant Accounting Policies [Line Items] | |||||
Warranty period | 10 years | ||||
Movado Watch Cases And Bracelets | |||||
Significant Accounting Policies [Line Items] | |||||
Warranty period | 5 years | ||||
Minimum | |||||
Significant Accounting Policies [Line Items] | |||||
Warranty period | 2 years | ||||
Minimum | Trademarks and Developed Technology | |||||
Significant Accounting Policies [Line Items] | |||||
Intangible Asset, Useful Life | 3 years | ||||
Maximum | |||||
Significant Accounting Policies [Line Items] | |||||
Warranty period | 3 years | ||||
Maximum | Trademarks and Developed Technology | |||||
Significant Accounting Policies [Line Items] | |||||
Intangible Asset, Useful Life | 10 years | ||||
Building | |||||
Significant Accounting Policies [Line Items] | |||||
Property Plant And Equipment Useful Life | 40 years | ||||
Furniture and equipment | Minimum | |||||
Significant Accounting Policies [Line Items] | |||||
Property Plant And Equipment Useful Life | 4 years | ||||
Furniture and equipment | Maximum | |||||
Significant Accounting Policies [Line Items] | |||||
Property Plant And Equipment Useful Life | 10 years | ||||
Computer software | |||||
Significant Accounting Policies [Line Items] | |||||
Amortization expense | $ 3,600,000 | $ 3,500,000 | $ 3,500,000 | ||
Computer software | Minimum | |||||
Significant Accounting Policies [Line Items] | |||||
Property Plant And Equipment Useful Life | 5 years | ||||
Computer software | Maximum | |||||
Significant Accounting Policies [Line Items] | |||||
Property Plant And Equipment Useful Life | 10 years | ||||
Design Fees and Tooling Cost | |||||
Significant Accounting Policies [Line Items] | |||||
Property Plant And Equipment Useful Life | 3 years | ||||
Capitalized Software Cost | Minimum | |||||
Significant Accounting Policies [Line Items] | |||||
Property Plant And Equipment Useful Life | 2 years | ||||
Capitalized Software Cost | Maximum | |||||
Significant Accounting Policies [Line Items] | |||||
Property Plant And Equipment Useful Life | 10 years |
Significant Accounting Polici50
Significant Accounting Policies (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Schedule of warranty liability | |||
Balance, beginning of year | $ 2,728 | $ 2,556 | $ 2,710 |
Provision charged to operations | 2,845 | 2,092 | 1,630 |
Settlements made | (2,285) | (1,920) | (1,784) |
Balance, end of year | $ 3,288 | $ 2,728 | $ 2,556 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Jan. 31, 2018 | Jan. 31, 2017 |
Inventory Net [Abstract] | ||
Finished goods | $ 112,712 | $ 112,297 |
Component parts | 37,404 | 38,482 |
Work-in-process | 1,560 | 2,388 |
Inventories | $ 151,676 | $ 153,167 |
Property, Plant and Equipment52
Property, Plant and Equipment (Details) - USD ($) $ in Thousands | Jan. 31, 2018 | Jan. 31, 2017 |
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 117,929 | $ 126,824 |
Less: accumulated depreciation | (93,258) | (92,651) |
Property, plant and equipment, net | 24,671 | 34,173 |
Land and buildings | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | 1,610 | 1,490 |
Furniture and equipment | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | 48,748 | 59,163 |
Computer software | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | 32,359 | 32,077 |
Leasehold improvements | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | 32,814 | 32,307 |
Design fees and tooling costs | ||
Property Plant And Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 2,398 | $ 1,787 |
Property, Plant and Equipment53
Property, Plant and Equipment (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Property Plant And Equipment [Line Items] | |||
Depreciation and amortization | $ 13,457 | $ 11,507 | $ 13,156 |
Amortization expense | 2,000 | 400 | 300 |
Property, Plant and Equipment | |||
Property Plant And Equipment [Line Items] | |||
Depreciation and amortization | 11,800 | 11,900 | 12,400 |
Computer software | |||
Property Plant And Equipment [Line Items] | |||
Amortization expense | $ 3,600 | $ 3,500 | $ 3,500 |
Debt and Lines of Credit (Detai
Debt and Lines of Credit (Details Textual) | Feb. 28, 2018USD ($) | Jan. 30, 2015USD ($) | Jan. 31, 2018USD ($)CreditFacilityBankSubsidiary | Jan. 31, 2017USD ($)BankSubsidiary | Jan. 31, 2016USD ($) | Jan. 31, 2018CHF (SFr)CreditFacilityBankSubsidiary | Jan. 31, 2017CHF (SFr)BankSubsidiary |
Debt Instrument [Line Items] | |||||||
Repayment of outstanding debt | $ 5,000,000 | $ 13,000,000 | $ 10,000,000 | ||||
Consolidated Earnings Before Interest Tax Depreciation And Amortization | $ 50,000,000 | ||||||
Number of issued standby letter of credit | CreditFacility | 2 | 2 | |||||
Secured Debt | Credit Agreement Due on January 30, 2020 | |||||||
Debt Instrument [Line Items] | |||||||
Letter of credit outstanding amount | $ 300,000 | ||||||
Consolidated leverage ratio | 2.50% | 2.50% | |||||
Unsecured Debt | Swiss subsidiary | |||||||
Debt Instrument [Line Items] | |||||||
Line of credit facility, maximum borrowing capacity | $ 7,000,000 | 6,600,000 | SFr 6,500,000 | SFr 6,500,000 | |||
Outstanding borrowing amount | 0 | $ 0 | |||||
Revolving Credit Facility | Secured Debt | Credit Agreement Due on January 30, 2020 | |||||||
Debt Instrument [Line Items] | |||||||
Line of credit facility, maximum borrowing capacity | $ 100,000,000 | ||||||
Uncommitted increase to borrowing capacity | $ 50,000,000 | ||||||
Credit facility matures date | Jan. 30, 2020 | ||||||
Loan drawn under the facility | 25,000,000 | ||||||
Line of credit facility remaining borrowing capacity | $ 74,700,000 | ||||||
Revolving Credit Facility | Secured Debt | Credit Agreement Due on January 30, 2020 | LIBOR | |||||||
Debt Instrument [Line Items] | |||||||
Applicable margin rate | 1.25% | ||||||
Revolving Credit Facility | Secured Debt | Credit Agreement Due on January 30, 2020 | LIBOR | Minimum | |||||||
Debt Instrument [Line Items] | |||||||
Applicable margin rate | 1.25% | ||||||
Revolving Credit Facility | Secured Debt | Credit Agreement Due on January 30, 2020 | LIBOR | Maximum | |||||||
Debt Instrument [Line Items] | |||||||
Applicable margin rate | 1.75% | ||||||
Revolving Credit Facility | Secured Debt | Credit Agreement Due on January 30, 2020 | Base Rate | |||||||
Debt Instrument [Line Items] | |||||||
Applicable margin rate | 0.25% | ||||||
Revolving Credit Facility | Secured Debt | Credit Agreement Due on January 30, 2020 | Base Rate | Minimum | |||||||
Debt Instrument [Line Items] | |||||||
Applicable margin rate | 0.25% | ||||||
Revolving Credit Facility | Secured Debt | Credit Agreement Due on January 30, 2020 | Base Rate | Maximum | |||||||
Debt Instrument [Line Items] | |||||||
Applicable margin rate | 0.75% | ||||||
Revolving Credit Facility | Secured Debt | Credit Agreement Due on January 30, 2020 | Subsequent Event | |||||||
Debt Instrument [Line Items] | |||||||
Repayment of outstanding debt | $ 25,000,000 | ||||||
Letter of Credit | |||||||
Debt Instrument [Line Items] | |||||||
Credit facility matures date | May 31, 2018 | ||||||
Outstanding borrowing amount | $ 300,000 | ||||||
Letter of Credit | Secured Debt | Credit Agreement Due on January 30, 2020 | |||||||
Debt Instrument [Line Items] | |||||||
Line of credit facility, maximum borrowing capacity | $ 15,000,000 | ||||||
Line of Credit | Unsecured Debt | Swiss subsidiary | |||||||
Debt Instrument [Line Items] | |||||||
Number of European banks guaranteed obligations to third parties | Bank | 2 | 2 | 2 | 2 | |||
Number of foreign subsidiaries under guaranteed obligation | Subsidiary | 2 | 2 | 2 | 2 | |||
Guaranteed obligations to third parties | $ 1,200,000 | $ 1,200,000 | |||||
Restricted deposit relates to lease agreement | $ 600,000 | $ 600,000 |
Derivative Financial Instrume55
Derivative Financial Instruments (Details Textual) $ in Thousands | 12 Months Ended | |||||
Jan. 31, 2018USD ($) | Jan. 31, 2017USD ($) | Jan. 31, 2018CHF (SFr) | Jan. 31, 2018EUR (€) | Jan. 31, 2018GBP (£) | ||
Derivatives Fair Value [Line Items] | ||||||
Maximum length of time hedged in cash flow hedge | 24 months | |||||
Amounts reclassified from accumulated other comprehensive income (loss) | [1] | $ 926 | $ (286) | |||
Net Unrealized Income (Loss) On Hedging Contracts | ||||||
Derivatives Fair Value [Line Items] | ||||||
Amounts reclassified from accumulated other comprehensive income (loss) | [1] | 926 | (371) | |||
Accumulated other comprehensive income, tax expense (benefit) | $ 200 | $ 100 | ||||
Foreign Exchange Forward | ||||||
Derivatives Fair Value [Line Items] | ||||||
Net forward contracts hedging portfolio | SFr 19,000,000 | € 10,600,000 | £ 4,700,000 | |||
Maximum | ||||||
Derivatives Fair Value [Line Items] | ||||||
Expiry dates ranging | Jun. 13, 2018 | |||||
[1] | Amounts in fiscal 2018 and 2017 were reclassified to operating income in the Consolidated Statements of Operations. |
Derivative Financial Instrume56
Derivative Financial Instruments (Details) - USD ($) $ in Thousands | Jan. 31, 2018 | Jan. 31, 2017 |
Not Designated as Hedging Instrument | ||
Fair value and presentation of derivatives | ||
Asset Derivatives | $ 544 | $ 145 |
Liability Derivatives | 2 | 211 |
Not Designated as Hedging Instrument | Foreign Exchange Contract | Other Current Assets | ||
Fair value and presentation of derivatives | ||
Asset Derivatives | 544 | 145 |
Not Designated as Hedging Instrument | Foreign Exchange Contract | Accrued Liabilities | ||
Fair value and presentation of derivatives | ||
Liability Derivatives | 2 | $ 211 |
Designated as Hedging Instrument | ||
Fair value and presentation of derivatives | ||
Liability Derivatives | 44 | |
Designated as Hedging Instrument | Foreign Exchange Contract | Accrued Liabilities | ||
Fair value and presentation of derivatives | ||
Liability Derivatives | $ 44 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands | Jan. 31, 2018 | Jan. 31, 2017 |
Assets: | ||
Total assets measured at fair value | $ 40,554 | $ 32,530 |
Liabilities: | ||
Total liabilities measured at fair value | 38,623 | 31,042 |
Other Current Assets | Available-for-sale securities | ||
Assets: | ||
Total assets measured at fair value | 275 | 309 |
Other Current Assets | Short-term investment | ||
Assets: | ||
Total assets measured at fair value | 164 | 154 |
Other Current Assets | Hedge derivatives-Assets | ||
Assets: | ||
Total assets measured at fair value | 544 | 145 |
Other non-current assets | SERP assets - employer | ||
Assets: | ||
Total assets measured at fair value | 994 | 1,091 |
Other non-current assets | SERP assets - employee | ||
Assets: | ||
Total assets measured at fair value | 38,577 | 30,831 |
Other non-current liabilities | SERP liabilities - employee | ||
Liabilities: | ||
Total liabilities measured at fair value | 38,577 | 30,831 |
Accrued Liabilities | Hedge derivatives-Liabilities | ||
Liabilities: | ||
Total liabilities measured at fair value | 46 | 211 |
Level 1 | ||
Assets: | ||
Total assets measured at fair value | 40,010 | 32,385 |
Liabilities: | ||
Total liabilities measured at fair value | 38,577 | 30,831 |
Level 1 | Other Current Assets | Available-for-sale securities | ||
Assets: | ||
Total assets measured at fair value | 275 | 309 |
Level 1 | Other Current Assets | Short-term investment | ||
Assets: | ||
Total assets measured at fair value | 164 | 154 |
Level 1 | Other non-current assets | SERP assets - employer | ||
Assets: | ||
Total assets measured at fair value | 994 | 1,091 |
Level 1 | Other non-current assets | SERP assets - employee | ||
Assets: | ||
Total assets measured at fair value | 38,577 | 30,831 |
Level 1 | Other non-current liabilities | SERP liabilities - employee | ||
Liabilities: | ||
Total liabilities measured at fair value | 38,577 | 30,831 |
Level 2 | ||
Assets: | ||
Total assets measured at fair value | 544 | 145 |
Liabilities: | ||
Total liabilities measured at fair value | 46 | 211 |
Level 2 | Other Current Assets | Hedge derivatives-Assets | ||
Assets: | ||
Total assets measured at fair value | 544 | 145 |
Level 2 | Accrued Liabilities | Hedge derivatives-Liabilities | ||
Liabilities: | ||
Total liabilities measured at fair value | $ 46 | $ 211 |
Fair Value Measurements (Deta58
Fair Value Measurements (Details Textual) - USD ($) | 12 Months Ended | |
Jan. 31, 2018 | Jan. 31, 2017 | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | ||
Other than temporary impairment charge on investment | $ 1,282,000 | |
Cost method investments, carrying value | $ 0 | |
Short-term investment | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | ||
Fair value, investment | The fair value of the short-term investment, which is a guaranteed investment certificate, is based on its purchase price plus one half of a percent calculated annually |
Income Taxes (Details Textual)
Income Taxes (Details Textual) - USD ($) | 1 Months Ended | 3 Months Ended | 11 Months Ended | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2018 | Dec. 31, 2017 | Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Income Tax Contingency [Line Items] | ||||||
Corporate income tax rate | 21.00% | 35.00% | ||||
Percentage of undistributed foreign earnings | 15.50% | |||||
Percentage of all other earnings | 8.00% | |||||
Provisional tax expense | $ 45,000,000 | $ 45,000,000 | ||||
Payment of transition tax installments period | 8 years | |||||
Transaction tax payable due to enactment of 2017 tax act | $ 28,200,000 | |||||
Amount of estimated foreign earnings | 279,900,000 | |||||
Provisional amount of deferred tax assets and liabilities | 8,300,000 | |||||
Unremitted foreign earnings | 236,800,000 | |||||
Provisional change to deferred taxes related to withholding and U.S. state income taxes | 8,500,000 | |||||
Deferred tax liabilities, undistributed foreign earnings | $ 11,690,000 | 11,690,000 | 11,690,000 | $ 2,956,000 | ||
Tax expense (benefits) recorded in additional paid in capital | 300,000 | $ 0 | ||||
Provision for income taxes (Note 7) | $ 57,367,000 | $ 16,315,000 | $ 23,360,000 | |||
U.S. federal statutory blended rate | 33.80% | 35.00% | 35.00% | |||
Effective tax rate for continuing operations | 136.10% | 31.70% | 33.80% | |||
Income tax benefit from foreign operations | $ 0 | |||||
Unrecognized tax benefits which would impact the Company's effective tax rate | 2,300,000 | 2,300,000 | $ 2,300,000 | 2,600,000 | $ 2,400,000 | |
Accrued interest and penalties net of tax benefits | 800,000 | 800,000 | 800,000 | 700,000 | 600,000 | |
Accrued interest and penalties net of tax benefits | 100,000 | $ 100,000 | $ 100,000 | |||
Shortfall Tax Expenses | ||||||
Income Tax Contingency [Line Items] | ||||||
Provision for income taxes (Note 7) | 1,100,000 | |||||
Swiss subsidiary | ||||||
Income Tax Contingency [Line Items] | ||||||
Operating Loss carryforwards | 16,400,000 | 16,400,000 | 16,400,000 | |||
GILTI | ||||||
Income Tax Contingency [Line Items] | ||||||
Estimate of tax expense or benefit | 0 | |||||
Foreign Tax Authority | ||||||
Income Tax Contingency [Line Items] | ||||||
Deferred tax liabilities, undistributed foreign earnings | 83,700,000 | 83,700,000 | 83,700,000 | |||
Operating Loss carryforwards | 39,100,000 | 39,100,000 | 39,100,000 | |||
Operating loss carryforwards, valuation allowance | 8,900,000 | 8,900,000 | 8,900,000 | |||
Domestic Country | ||||||
Income Tax Contingency [Line Items] | ||||||
Operating Loss carryforwards | 0 | 0 | 0 | |||
State and Local Jurisdiction [Member] | ||||||
Income Tax Contingency [Line Items] | ||||||
Operating Loss carryforwards | 9,000,000 | 9,000,000 | 9,000,000 | |||
Operating loss carryforwards, valuation allowance | $ 100,000 | $ 100,000 | $ 100,000 | |||
Maximum | ||||||
Income Tax Contingency [Line Items] | ||||||
Measurement period | 1 year | |||||
Expiration periods | 10 years | |||||
Minimum | ||||||
Income Tax Contingency [Line Items] | ||||||
Expiration periods | 1 year |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2016 | Jul. 31, 2016 | Apr. 30, 2016 | Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Income Tax Disclosure [Abstract] | |||||||||||
U.S. income before taxes | $ 11,731 | $ 26,299 | $ 44,384 | ||||||||
Non-U.S. income before taxes | 30,411 | 25,155 | 24,741 | ||||||||
Income before income taxes | $ 13,118 | $ 24,850 | $ 8,056 | $ (3,882) | $ 7,097 | $ 29,501 | $ 9,796 | $ 5,060 | $ 42,142 | $ 51,454 | $ 69,125 |
Income Taxes (Details 1)
Income Taxes (Details 1) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Current: | |||
U.S. Federal | $ 31,599 | $ 14,079 | $ 17,776 |
U.S. State and Local | 960 | 1,117 | 1,434 |
Non-U.S. | 7,145 | 5,091 | 5,291 |
Total current | 39,704 | 20,287 | 24,501 |
Deferred: | |||
U.S. Federal | 16,671 | (4,231) | (1,995) |
U.S. State and Local | 622 | (167) | (228) |
Non-U.S. | 370 | 426 | 1,082 |
Total deferred | 17,663 | (3,972) | (1,141) |
Provision for income taxes | $ 57,367 | $ 16,315 | $ 23,360 |
Income Taxes (Details 2)
Income Taxes (Details 2) - USD ($) $ in Thousands | Jan. 31, 2018 | Jan. 31, 2017 |
Deferred Taxes Assets | ||
Net operating loss carryforwards, Assets | $ 10,589 | $ 10,516 |
Inventory, Assets | 2,199 | 3,782 |
Unprocessed returns, Assets | 955 | 1,200 |
Receivables allowances, Assets | 227 | 1,151 |
Deferred compensation, Assets | 12,985 | 18,955 |
Capital loss carryforwards, Assets | 389 | |
Other provisions/accruals, Assets | 63 | 207 |
Miscellaneous, Assets | 955 | |
Total, Assets | 27,018 | 37,155 |
Valuation allowance, Assets | (8,960) | (8,714) |
Total deferred tax assets and liabilities | 18,058 | 28,441 |
Deferred Taxes Liabilities | ||
Unrepatriated earnings, Liabilities | 11,690 | 2,956 |
Depreciation / amortization, Liabilities | 4,440 | 1,245 |
Miscellaneous, Liabilities | 199 | |
Total, Liabilities | 16,329 | 4,201 |
Total deferred tax assets and liabilities | $ 16,329 | $ 4,201 |
Income Taxes (Details 3)
Income Taxes (Details 3) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Schedule of income taxes provision / (benefit) for continuing operations by applying U.S. federal statutory rate | |||
Provision for income taxes at the U.S. statutory rate | $ 14,248 | $ 18,009 | $ 24,194 |
Lower effective non-U.S. income tax rate | (4,378) | (4,725) | (4,463) |
Change in valuation allowance | 136 | 828 | 986 |
U.S. tax provided on earnings of non-U.S. subsidiaries | 541 | 1,029 | |
Change in liabilities for uncertain tax positions, net | (381) | 215 | (98) |
State and local taxes, net of federal benefit | 626 | 617 | 1,234 |
Impact of 2017 Tax Act | 45,002 | ||
Excess tax deficiencies from stock-based compensation | 1,094 | ||
Non-deductible acquisition costs | 786 | ||
Other, net | 234 | 830 | 478 |
Provision for income taxes | $ 57,367 | $ 16,315 | $ 23,360 |
Income Taxes (Details 4)
Income Taxes (Details 4) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Schedule of reconciliation of beginning and ending amounts of gross unrecognized tax benefits | |||
Beginning balance | $ 2,619 | $ 2,481 | $ 2,657 |
Additions for tax positions taken in the current year | 180 | 142 | 175 |
Tax positions taken in prior years | 148 | ||
Lapse of statute of limitations | (630) | (311) | |
Settlements | (149) | ||
Non U.S. currency exchange fluctuations | 186 | (4) | (40) |
Ending balance | $ 2,354 | $ 2,619 | $ 2,481 |
Leases (Details Textual)
Leases (Details Textual) - USD ($) $ in Millions | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Leases [Abstract] | |||
Operating lease expiration period | 2030-06 | ||
Rent expense from continuing operations | $ 17.8 | $ 14.2 | $ 13.5 |
Leases (Details)
Leases (Details) $ in Thousands | Jan. 31, 2018USD ($) |
Minimum annual rentals under non-cancelable operating leases | |
2,019 | $ 11,607 |
2,020 | 7,490 |
2,021 | 7,041 |
2,022 | 6,245 |
2,023 | 5,563 |
Thereafter | 28,234 |
Total operating leases | $ 66,180 |
Commitments and Contingencies (
Commitments and Contingencies (Details Textual) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended |
Dec. 31, 2016 | Jan. 31, 2018 | |
Loss Contingencies [Line Items] | ||
Amount of minimum commitments related to license agreements and endorsement agreements | $ 202 | |
Outstanding purchase obligations with supplier | 83.8 | |
Transaction tax payable due to enactment of 2017 tax act | $ 28.2 | |
Payment of transition tax installments period | 8 years | |
Underpaid duty charges due to alternative duty methodology | $ 5.1 | |
Underpaid duty methodology period covered by statute of limitation | 5 years | |
Other Current Assets | ||
Loss Contingencies [Line Items] | ||
Restricted cash deposits released | $ 1 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details Textual) - USD ($) $ / shares in Units, $ in Millions | Apr. 04, 2013 | Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Expected term | 6 years | 6 years | 5 years | |
Risk-free interest rate | 1.93% | 1.42% | 1.34% | |
Expected volatility | 46.16% | 47.81% | 48.77% | |
Dividend yield | 1.51% | 1.01% | 0.81% | |
Weighted-average grant date fair value of options granted | $ 9.15 | $ 11.17 | $ 12.31 | |
Compensation expense | $ 0.5 | $ 1.3 | $ 1.1 | |
Compensation expense, net of tax | 0.3 | 0.8 | 0.6 | |
Unrecognized compensation cost related to unvested stock options | $ 1.6 | |||
Weighted-average period | 1 year 9 months 18 days | |||
Cash received for stock option exercises | $ 2 | 1 | 0.6 | |
Realized tax expense | 0.5 | |||
Fair value of stock options exercised | 0.5 | 0.2 | 0.2 | |
Fair value of the stock options vested | 1.3 | 2 | 2.9 | |
Intrinsic value of outstanding stock options | 2.3 | 0.6 | 0.3 | |
Intrinsic value of exercisable stock options | 0.7 | 0.4 | 0.3 | |
Stock Award Units | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Compensation expense | 1.8 | 3.2 | 2.7 | |
Compensation expense, net of tax | $ 1.1 | 2 | 1.7 | |
Weighted-average period | 1 year 7 months 6 days | |||
Stock awards vesting period | 3 years | |||
Unrecognized compensation cost | $ 3.6 | |||
Fair value of stock award units vested | $ 2.6 | $ 4.8 | $ 2.5 | |
Units granted, Weighted Average Grant Date Fair Value | $ 23.31 | $ 27.76 | $ 29.48 | |
Fair value of unvested stock award units | $ 10.5 | $ 10.3 | $ 9.6 | |
Realized tax expense on vested stock awards | $ 0.6 | |||
Employee Stock Option Plan | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Number of common stock shares | 11,000,000 | |||
Options granted to participants exercisable period | 3 years |
Stock-Based Compensation (Det69
Stock-Based Compensation (Details) - $ / shares | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Schedule of transactions for stock options under Plan | |||
Outstanding Option Beginning Balance | 859,358 | 699,600 | 616,220 |
Options granted | 161,205 | 200,346 | 126,880 |
Options exercised | (85,600) | (40,588) | (28,450) |
Options cancelled | (173,262) | (15,050) | |
Outstanding Option Ending Balance | 761,701 | 859,358 | 699,600 |
Weighted Average Exercise Price, Beginning Balance | $ 29.83 | $ 30.41 | $ 30.08 |
Options granted, Weighted Average Exercise Price | 23.35 | 26.97 | 30.36 |
Options exercised, Weighted Average Exercise Price | 23.18 | 25.68 | 21.49 |
Options cancelled, Weighted Average Exercise Price | 30.21 | 33.32 | |
Weighted Average Exercise Price, Ending Balance | $ 29.12 | $ 29.83 | $ 30.41 |
Stock-Based Compensation (Det70
Stock-Based Compensation (Details 1) | 12 Months Ended |
Jan. 31, 2018$ / sharesshares | |
Schedule of outstanding and exercisable stock options | |
Number Outstanding | shares | 761,701 |
Weighted-Average Remaining Contractual Life (years) | 6 years 3 months 18 days |
Outstanding stock options, weighted Average Exercise Price | $ 29.12 |
Number Exercisable | shares | 394,455 |
Exercisable stock options, Weighted-Average Exercise Price | $ 31.75 |
Range One | |
Schedule of outstanding and exercisable stock options | |
Minimum Range of Exercise Price | 21.03 |
Maximum Range of Exercise Price | $ 24.02 |
Number Outstanding | shares | 161,955 |
Weighted-Average Remaining Contractual Life (years) | 9 years 2 months 12 days |
Outstanding stock options, weighted Average Exercise Price | $ 23.34 |
Number Exercisable | shares | 750 |
Exercisable stock options, Weighted-Average Exercise Price | $ 22.04 |
Range Two | |
Schedule of outstanding and exercisable stock options | |
Minimum Range of Exercise Price | 24.03 |
Maximum Range of Exercise Price | $ 27.02 |
Number Outstanding | shares | 166,012 |
Weighted-Average Remaining Contractual Life (years) | 4 years 2 months 12 days |
Outstanding stock options, weighted Average Exercise Price | $ 26.59 |
Number Exercisable | shares | 166,012 |
Exercisable stock options, Weighted-Average Exercise Price | $ 26.59 |
Range Three | |
Schedule of outstanding and exercisable stock options | |
Minimum Range of Exercise Price | 27.03 |
Maximum Range of Exercise Price | $ 30.02 |
Number Outstanding | shares | 140,811 |
Weighted-Average Remaining Contractual Life (years) | 8 years 2 months 12 days |
Outstanding stock options, weighted Average Exercise Price | $ 27.74 |
Range Four | |
Schedule of outstanding and exercisable stock options | |
Minimum Range of Exercise Price | 30.03 |
Maximum Range of Exercise Price | $ 33.02 |
Number Outstanding | shares | 189,770 |
Weighted-Average Remaining Contractual Life (years) | 6 years 1 month 6 days |
Outstanding stock options, weighted Average Exercise Price | $ 30.35 |
Number Exercisable | shares | 124,540 |
Exercisable stock options, Weighted-Average Exercise Price | $ 30.34 |
Range Five | |
Schedule of outstanding and exercisable stock options | |
Minimum Range of Exercise Price | 33.03 |
Maximum Range of Exercise Price | $ 42.02 |
Number Outstanding | shares | 19,853 |
Weighted-Average Remaining Contractual Life (years) | 6 years 4 months 24 days |
Outstanding stock options, weighted Average Exercise Price | $ 40.52 |
Number Exercisable | shares | 19,853 |
Exercisable stock options, Weighted-Average Exercise Price | $ 40.52 |
Range Six | |
Schedule of outstanding and exercisable stock options | |
Minimum Range of Exercise Price | 42.03 |
Maximum Range of Exercise Price | $ 45.02 |
Number Outstanding | shares | 83,300 |
Weighted-Average Remaining Contractual Life (years) | 6 years 2 months 12 days |
Outstanding stock options, weighted Average Exercise Price | $ 42.12 |
Number Exercisable | shares | 83,300 |
Exercisable stock options, Weighted-Average Exercise Price | $ 42.12 |
Stock-Based Compensation (Det71
Stock-Based Compensation (Details 2) - Stock Award Units - $ / shares | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Number of Stock Award Units | |||
Stock Award Units, Beginning Balance | 381,158 | 374,598 | 337,356 |
Units granted | 133,245 | 187,777 | 136,310 |
Units vested | (115,574) | (170,010) | (83,578) |
Units forfeited | (56,059) | (11,207) | (15,490) |
Stock Award Units, Ending Balance | 342,770 | 381,158 | 374,598 |
Weighted Average Grant Date Fair Value | |||
Weighted Average Grant Date Fair Value, Beginning Balance | $ 31.71 | $ 33.83 | $ 34.72 |
Units granted, Weighted Average Grant Date Fair Value | 23.31 | 27.76 | 29.48 |
Units vested, Weighted Average Grant Date Fair Value | 39.44 | 31.85 | 29.99 |
Units forfeited, Weighted Average Grant Date Fair Value | 30.27 | 34.50 | 35.70 |
Weighted Average Grant Date Fair Value Ending Balance | $ 26.07 | $ 31.71 | $ 33.83 |
Other Employee Benefit Plans (D
Other Employee Benefit Plans (Details Textual) - USD ($) $ in Millions | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Contributions and expenses of administering the Employee benefit plans | $ 3.1 | $ 3.1 | $ 2.9 |
Matching contribution | 5 years | ||
Expenses related to the SERP | $ 0.6 | 0.9 | $ 0.4 |
Former Vice Chairman and Chief Operating Officer | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Compensation related expenses associated with retirement | $ 0.3 | ||
Share-Based Compensation Award, Tranche One | Maximum | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Matching contribution, annual vesting percentage | 5.00% | ||
Share-Based Compensation Award, Tranche Two | Maximum | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Matching contribution, annual vesting percentage | 10.00% |
Accumulated Other Comprehensi73
Accumulated Other Comprehensive Income (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Jan. 31, 2018 | Jan. 31, 2017 | |||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||
Beginning Balance | $ 473,993 | |||
Other comprehensive income / (loss) before reclassifications | 24,489 | $ 7,989 | ||
Amounts reclassified from accumulated other comprehensive income | [1] | (926) | 286 | |
Net current-period other comprehensive income / (loss) | 23,563 | 8,275 | ||
Ending Balance | 470,335 | 473,993 | ||
Currency Translation Adjustments | ||||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||
Beginning Balance | 76,569 | 68,265 | ||
Other comprehensive income / (loss) before reclassifications | 23,621 | 8,389 | ||
Amounts reclassified from accumulated other comprehensive income | [1] | (85) | ||
Net current-period other comprehensive income / (loss) | 23,621 | 8,304 | ||
Ending Balance | 100,190 | 76,569 | ||
Available-for-sale securities | ||||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||
Beginning Balance | 197 | 189 | ||
Other comprehensive income / (loss) before reclassifications | (6) | [2] | 8 | |
Net current-period other comprehensive income / (loss) | (6) | 8 | ||
Ending Balance | 191 | 197 | ||
Net Unrealized Income (Loss) On Hedging Contracts | ||||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||
Beginning Balance | 14 | 51 | ||
Other comprehensive income / (loss) before reclassifications | 874 | (408) | ||
Amounts reclassified from accumulated other comprehensive income | [1] | (926) | 371 | |
Net current-period other comprehensive income / (loss) | (52) | (37) | ||
Ending Balance | (38) | 14 | ||
Accumulated Other Comprehensive Income | ||||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||
Beginning Balance | 76,780 | 68,505 | ||
Ending Balance | $ 100,343 | $ 76,780 | ||
[1] | Amounts in fiscal 2018 and 2017 were reclassified to operating income in the Consolidated Statements of Operations. | |||
[2] | Includes approximately twenty-one thousand dollars related to the tax effect of the tax rate change on marketable securities (see Note 7 – Income Taxes) |
Accumulated Other Comprehensi74
Accumulated Other Comprehensive Income (Details) (Parenthetical) $ in Thousands | 12 Months Ended |
Jan. 31, 2018USD ($) | |
Accumulated Other Comprehensive Income Loss Net Of Tax [Abstract] | |
Other comprehensive income (loss) before reclassification adjustments, tax rate on marketable securities | $ 21 |
Segment and Geographic Inform75
Segment and Geographic Information (Details Textual) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||
Jan. 31, 2018USD ($) | Oct. 31, 2017USD ($) | Jul. 31, 2017USD ($) | Apr. 30, 2017USD ($) | Jan. 31, 2017USD ($) | Oct. 31, 2016USD ($) | Jul. 31, 2016USD ($) | Apr. 30, 2016USD ($) | Jan. 31, 2018USD ($)SegmentLocation | Jan. 31, 2017USD ($) | Jan. 31, 2016USD ($) | |||||
Segment Reporting Information [Line Items] | |||||||||||||||
Number of operating segments | Segment | 2 | ||||||||||||||
Number of geographic locations | Location | 2 | ||||||||||||||
Operating efficiency initiatives and other items | $ 3,996 | ||||||||||||||
Net sales | $ 149,214 | $ 190,693 | $ 128,781 | $ 99,265 | $ 130,785 | $ 179,818 | $ 128,086 | $ 114,063 | $ 567,953 | [1] | $ 552,752 | [1] | 594,923 | [1] | |
Unallocated corporate expenses | 25,200 | 26,300 | 27,000 | ||||||||||||
Profits related to the company's supply chain operations | 41,500 | 40,000 | 44,500 | ||||||||||||
Intersegment Eliminations | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
Net sales | 268,100 | 289,200 | 309,100 | ||||||||||||
Former Vice Chairman and Chief Operating Officer | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
Pre-tax charges related to vesting of stock awards and compensation on retirement | 300 | ||||||||||||||
Wholesale | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
Charge related to transaction charges and the amortization of acquisition accounting adjustments | 6,800 | ||||||||||||||
Operating efficiency initiatives and other items | 4,000 | ||||||||||||||
Net sales | [1] | 492,082 | 484,444 | 530,009 | |||||||||||
Wholesale | Cost Savings Initiatives | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
Operating efficiency initiatives and other items | 13,600 | ||||||||||||||
United States | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
Net sales | [1] | 260,606 | 296,311 | $ 326,206 | |||||||||||
United States | Wholesale | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
Charge related to transaction charges and the amortization of acquisition accounting adjustments | 400 | ||||||||||||||
United States | Wholesale | Former Vice Chairman and Chief Operating Officer | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
Pre-tax charges related to vesting of stock awards and compensation on retirement | $ 1,800 | ||||||||||||||
United States | Wholesale | Cost Savings Initiatives | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
Operating efficiency initiatives and other items | $ 3,900 | ||||||||||||||
Geographic Concentration Risk | Europe | Total net sales | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
International Operations Contribution | 32.10% | 23.10% | 21.20% | ||||||||||||
Geographic Concentration Risk | the Americas (excluding the United States) | Total net sales | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
International Operations Contribution | 9.20% | 8.90% | 10.50% | ||||||||||||
Geographic Concentration Risk | Middle East | Total net sales | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
International Operations Contribution | 7.70% | 8.10% | 7.40% | ||||||||||||
Geographic Concentration Risk | Asia | Total net sales | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
International Operations Contribution | 5.10% | 6.30% | 6.10% | ||||||||||||
[1] | The United States and International net sales are net of intercompany sales of $268.1 million, $289.2 million and $309.1 million for the fiscal years ended January 31, 2018, 2017 and 2016, respectively. |
Segment and Geographic Inform76
Segment and Geographic Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||
Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2016 | Jul. 31, 2016 | Apr. 30, 2016 | Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |||||
Operating segment data | |||||||||||||||
Net sales | $ 149,214 | $ 190,693 | $ 128,781 | $ 99,265 | $ 130,785 | $ 179,818 | $ 128,086 | $ 114,063 | $ 567,953 | [1] | $ 552,752 | [1] | $ 594,923 | [1] | |
Operating Income | [2],[3],[4],[5],[6],[7] | 43,200 | 53,981 | 70,107 | |||||||||||
Total Assets | 645,380 | 607,802 | 645,380 | 607,802 | |||||||||||
Capital Expenditures | 5,810 | 5,920 | 8,070 | ||||||||||||
Depreciation and Amortization | 13,457 | 11,507 | 13,156 | ||||||||||||
Wholesale | |||||||||||||||
Operating segment data | |||||||||||||||
Net sales | [1] | 492,082 | 484,444 | 530,009 | |||||||||||
Operating Income | [2],[3],[4],[5],[6],[7] | 28,296 | 41,773 | 58,242 | |||||||||||
Total Assets | 621,965 | 584,518 | 621,965 | 584,518 | |||||||||||
Capital Expenditures | 3,133 | 5,666 | 5,902 | ||||||||||||
Depreciation and Amortization | 11,765 | 9,875 | 11,561 | ||||||||||||
Wholesale | Owned brands category | |||||||||||||||
Operating segment data | |||||||||||||||
Net sales | [1] | 204,897 | 205,396 | 219,012 | |||||||||||
Wholesale | Licensed brands category | |||||||||||||||
Operating segment data | |||||||||||||||
Net sales | [1] | 277,323 | 265,137 | 297,227 | |||||||||||
Wholesale | After-sales service and all other | |||||||||||||||
Operating segment data | |||||||||||||||
Net sales | [1] | 9,862 | 13,911 | 13,770 | |||||||||||
Retail | |||||||||||||||
Operating segment data | |||||||||||||||
Net sales | [1] | 75,871 | 68,308 | 64,914 | |||||||||||
Operating Income | [2],[3],[4],[5],[6],[7] | 14,904 | 12,208 | 11,865 | |||||||||||
Total Assets | $ 23,415 | $ 23,284 | 23,415 | 23,284 | |||||||||||
Capital Expenditures | 2,677 | 254 | 2,168 | ||||||||||||
Depreciation and Amortization | $ 1,692 | $ 1,632 | $ 1,595 | ||||||||||||
[1] | The United States and International net sales are net of intercompany sales of $268.1 million, $289.2 million and $309.1 million for the fiscal years ended January 31, 2018, 2017 and 2016, respectively. | ||||||||||||||
[2] | Fiscal 2016 Wholesale and United States and International operating income included a $4.0 million charge as a result of actions taken by the Company in fiscal 2016 to achieve greater operating efficiencies and streamline its operations. | ||||||||||||||
[3] | Fiscal 2017 Wholesale and United States operating income included a pre-tax charge of $1.8 million, as a result of the immediate vesting of stock awards and certain other compensation related to the announcement of the retirement of the Company’s former Vice Chairman and Chief Operating Officer, in fiscal 2017. | ||||||||||||||
[4] | Fiscal 2018 Wholesale and United States and International operating (loss) / income included a charge of $13.6 million as part of the Company’s cost savings initiatives. In fiscal 2018, the Company took actions to better align its global infrastructure with the current business environment by consolidating certain operations and streamlining functions to reduce costs and improve profitability. Also, in light of the changing retail landscape and the growing importance of digital marketing and online sales, the Company decided to cease its participation in the Baselworld Watch and Jewelry Show. | ||||||||||||||
[5] | Fiscal 2018 Wholesale and United States and International operating (loss) / income included a charge of $6.8 million related to transaction charges and the amortization of acquisition accounting adjustments associated with the purchase of the Olivia Burton brand. | ||||||||||||||
[6] | The International operating income included $41.5 million, $40.0 million and $44.5 million of certain intercompany profits related to the Company’s supply chain operations for the fiscal years ended January 31, 2018, 2017 and 2016, respectively. | ||||||||||||||
[7] | The United States operating income included $25.2 million, $26.3 million and $27.0 million of unallocated corporate expenses for the fiscal years ended January 31, 2018, 2017 and 2016, respectively. |
Segment and Geographic Inform77
Segment and Geographic Information (Details 1) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||
Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2016 | Jul. 31, 2016 | Apr. 30, 2016 | Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |||||
Revenues From External Customers And Long Lived Assets [Line Items] | |||||||||||||||
Net sales | $ 149,214 | $ 190,693 | $ 128,781 | $ 99,265 | $ 130,785 | $ 179,818 | $ 128,086 | $ 114,063 | $ 567,953 | [1] | $ 552,752 | [1] | $ 594,923 | [1] | |
Operating (Loss) / Income | [2],[3],[4],[5],[6],[7] | 43,200 | 53,981 | 70,107 | |||||||||||
Total Assets | 645,380 | 607,802 | 645,380 | 607,802 | |||||||||||
Property, Plant and Equipment, Net | 24,671 | 34,173 | 24,671 | 34,173 | |||||||||||
United States | |||||||||||||||
Revenues From External Customers And Long Lived Assets [Line Items] | |||||||||||||||
Net sales | [1] | 260,606 | 296,311 | 326,206 | |||||||||||
Operating (Loss) / Income | [2],[3],[4],[5],[6],[7] | (629) | 16,917 | 29,867 | |||||||||||
Total Assets | 188,346 | 207,246 | 188,346 | 207,246 | |||||||||||
Property, Plant and Equipment, Net | 16,570 | 19,197 | 16,570 | 19,197 | |||||||||||
International | |||||||||||||||
Revenues From External Customers And Long Lived Assets [Line Items] | |||||||||||||||
Net sales | [1] | 307,347 | 256,441 | 268,717 | |||||||||||
Operating (Loss) / Income | [2],[3],[4],[5],[6],[7] | 43,829 | 37,064 | $ 40,240 | |||||||||||
Total Assets | 457,034 | 400,556 | 457,034 | 400,556 | |||||||||||
Property, Plant and Equipment, Net | $ 8,101 | $ 14,976 | $ 8,101 | $ 14,976 | |||||||||||
[1] | The United States and International net sales are net of intercompany sales of $268.1 million, $289.2 million and $309.1 million for the fiscal years ended January 31, 2018, 2017 and 2016, respectively. | ||||||||||||||
[2] | Fiscal 2016 Wholesale and United States and International operating income included a $4.0 million charge as a result of actions taken by the Company in fiscal 2016 to achieve greater operating efficiencies and streamline its operations. | ||||||||||||||
[3] | Fiscal 2017 Wholesale and United States operating income included a pre-tax charge of $1.8 million, as a result of the immediate vesting of stock awards and certain other compensation related to the announcement of the retirement of the Company’s former Vice Chairman and Chief Operating Officer, in fiscal 2017. | ||||||||||||||
[4] | Fiscal 2018 Wholesale and United States and International operating (loss) / income included a charge of $13.6 million as part of the Company’s cost savings initiatives. In fiscal 2018, the Company took actions to better align its global infrastructure with the current business environment by consolidating certain operations and streamlining functions to reduce costs and improve profitability. Also, in light of the changing retail landscape and the growing importance of digital marketing and online sales, the Company decided to cease its participation in the Baselworld Watch and Jewelry Show. | ||||||||||||||
[5] | Fiscal 2018 Wholesale and United States and International operating (loss) / income included a charge of $6.8 million related to transaction charges and the amortization of acquisition accounting adjustments associated with the purchase of the Olivia Burton brand. | ||||||||||||||
[6] | The International operating income included $41.5 million, $40.0 million and $44.5 million of certain intercompany profits related to the Company’s supply chain operations for the fiscal years ended January 31, 2018, 2017 and 2016, respectively. | ||||||||||||||
[7] | The United States operating income included $25.2 million, $26.3 million and $27.0 million of unallocated corporate expenses for the fiscal years ended January 31, 2018, 2017 and 2016, respectively. |
Quarterly Financial Data (Una78
Quarterly Financial Data (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||||
Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2016 | Jul. 31, 2016 | Apr. 30, 2016 | Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | ||||
Unaudited selected interim operating results | ||||||||||||||
Net sales | $ 149,214 | $ 190,693 | $ 128,781 | $ 99,265 | $ 130,785 | $ 179,818 | $ 128,086 | $ 114,063 | $ 567,953 | [1] | $ 552,752 | [1] | $ 594,923 | [1] |
Gross profit | 78,745 | 104,070 | 66,126 | 49,137 | 64,687 | 98,550 | 70,263 | 61,317 | 298,078 | 294,817 | 316,930 | |||
(Loss) / Income before income taxes | 13,118 | 24,850 | 8,056 | (3,882) | 7,097 | 29,501 | 9,796 | 5,060 | 42,142 | 51,454 | 69,125 | |||
Net (loss) / income | 5,232 | 20,215 | 6,355 | 3,337 | (15,225) | 35,139 | 45,765 | |||||||
Net (loss) / income attributed to Movado Group, Inc. | $ (33,908) | $ 17,360 | $ 5,482 | $ (4,159) | $ 5,232 | $ 20,215 | $ 6,306 | $ 3,308 | $ (15,225) | $ 35,061 | $ 45,094 | |||
Basic income per share: | ||||||||||||||
Net (loss) / income attributed to Movado Group, Inc. | $ (1.47) | $ 0.75 | $ 0.24 | $ (0.18) | $ 0.23 | $ 0.88 | $ 0.27 | $ 0.14 | $ (0.66) | $ 1.52 | $ 1.92 | |||
Diluted income per share: | ||||||||||||||
Net (loss) / income attributed to Movado Group, Inc. | $ (1.47) | $ 0.75 | $ 0.24 | $ (0.18) | $ 0.22 | $ 0.87 | $ 0.27 | $ 0.14 | $ (0.66) | $ 1.51 | $ 1.90 | |||
[1] | The United States and International net sales are net of intercompany sales of $268.1 million, $289.2 million and $309.1 million for the fiscal years ended January 31, 2018, 2017 and 2016, respectively. |
Supplemental Cash Flow Inform79
Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Cash paid during the year for: | |||
Interest | $ 1,223 | $ 1,121 | $ 797 |
Income taxes, net | $ 20,366 | 22,768 | $ 22,500 |
Supplemental disclosures of non-cash investing activities: | |||
Additions to property, plant and equipment included in accrued liabilities | $ 4 |
Net (Loss) _ Income Attributed
Net (Loss) / Income Attributed to Movado Group, Inc. and Transfers to Noncontrolling Interest (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2016 | Jul. 31, 2016 | Apr. 30, 2016 | Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Schedule of net income attributable to non controlling interest | |||||||||||
Net (loss) / income attributed to Movado Group, Inc. | $ (33,908) | $ 17,360 | $ 5,482 | $ (4,159) | $ 5,232 | $ 20,215 | $ 6,306 | $ 3,308 | $ (15,225) | $ 35,061 | $ 45,094 |
Transfers to the noncontrolling interest | |||||||||||
Decrease in Movado Group, Inc.’s paid-in capital for purchase of joint venture common shares | (1,011) | (3,613) | |||||||||
Net transfers to noncontrolling interest | (1,011) | (3,613) | |||||||||
Change from net (loss) / income attributed to Movado Group, Inc. and transfers to noncontrolling interest | $ (15,225) | $ 34,050 | $ 41,481 |
Net (Loss) _ Income Attribute81
Net (Loss) / Income Attributed to Movado Group, Inc. and Transfers to Noncontrolling Interest (Details Textual) - USD ($) $ in Millions | Aug. 04, 2016 | Jan. 06, 2016 | Jan. 30, 2013 | Jan. 31, 2018 |
Schedule Of Equity Method Investments [Line Items] | ||||
Percentage of ownership controlled | 51.00% | |||
Percentage increase in ownership interest | 49.00% | |||
Co-venturer | ||||
Schedule Of Equity Method Investments [Line Items] | ||||
Percentage of ownership controlled | 49.00% | |||
Purchase price | $ 5.6 | |||
JV Agreement | ||||
Schedule Of Equity Method Investments [Line Items] | ||||
Agreement termination date | Aug. 4, 2016 | |||
Joint venture termination description | On August 4, 2016, Movado Group, Inc. and Majorelle Limited, an English company (“Majorelle”), voluntarily terminated the joint venture agreement they had entered into on January 30, 2013 (the “JV Agreement”) relating to MGS Distribution Limited, an English company (“MGS”). | |||
JV Agreement | MGS | ||||
Schedule Of Equity Method Investments [Line Items] | ||||
Percentage of ownership controlled | 90.00% | |||
Ownership interest in wholly-owned entity | 100.00% | |||
JV Agreement | Co-venturer | ||||
Schedule Of Equity Method Investments [Line Items] | ||||
Percentage of ownership controlled | 10.00% | |||
JV Agreement | Majorelle | MGS | ||||
Schedule Of Equity Method Investments [Line Items] | ||||
Purchase price | $ 1.7 |
Treasury Stock (Details Textual
Treasury Stock (Details Textual) - USD ($) | Aug. 29, 2017 | Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | Aug. 29, 2017 | Mar. 31, 2016 |
Equity Class Of Treasury Stock [Line Items] | ||||||
Stock repurchase program, total cost of shares repurchased | $ 3,631,000 | $ 3,864,000 | $ 48,748,000 | |||
New Share Repurchase Program | ||||||
Equity Class Of Treasury Stock [Line Items] | ||||||
Stock repurchase program, number of shares authorized | $ 50,000,000 | $ 50,000,000 | ||||
Stock repurchase program expiration date | Aug. 29, 2020 | |||||
Previously Authorized Repurchase Plan | ||||||
Equity Class Of Treasury Stock [Line Items] | ||||||
Stock repurchase program, number of shares authorized | $ 50,000,000 | |||||
Stock repurchase program, number of shares repurchased | 157,499 | |||||
Stock repurchase program, total cost of shares repurchased | $ 3,900,000 | $ 5,500,000 | ||||
Stock repurchase program, average per share price of shares repurchased | $ 24.54 | |||||
New and Previously Authorized Repurchase Plans | ||||||
Equity Class Of Treasury Stock [Line Items] | ||||||
Stock repurchase program, number of shares repurchased | 140,507 | |||||
Stock repurchase program, total cost of shares repurchased | $ 3,600,000 | |||||
Stock repurchase program, average per share price of shares repurchased | $ 25.84 | |||||
Surrender of Shares by Employee | ||||||
Equity Class Of Treasury Stock [Line Items] | ||||||
Stock repurchase program, number of shares repurchased | 36,843 | 47,310 | ||||
Movado Group Foundation | Previously Authorized Repurchase Plan | ||||||
Equity Class Of Treasury Stock [Line Items] | ||||||
Stock repurchase program, number of shares repurchased | 35,000 | |||||
Stock repurchase program, total cost of shares repurchased | $ 1,000,000 | |||||
Stock repurchase program, average per share price of shares repurchased | $ 29.03 | |||||
Movado Group Foundation | New and Previously Authorized Repurchase Plans | ||||||
Equity Class Of Treasury Stock [Line Items] | ||||||
Stock repurchase program, number of shares repurchased | 40,000 | |||||
Stock repurchase program, total cost of shares repurchased | $ 1,100,000 | |||||
Stock repurchase program, average per share price of shares repurchased | $ 27.13 |
Accounting Changes and Recent83
Accounting Changes and Recent Accounting Pronouncements (Details Textual) - USD ($) $ in Thousands | Jan. 31, 2018 | Jan. 31, 2017 |
New Accounting Pronouncements Or Change In Accounting Principle [Line Items] | ||
Retained earnings | $ 388,739 | $ 415,919 |
ASU 2014-09 | ||
New Accounting Pronouncements Or Change In Accounting Principle [Line Items] | ||
Retained earnings | $ 700 |
Operating Efficiency Initiati84
Operating Efficiency Initiatives and Other Items (Details Textual) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 31, 2018 | Jan. 31, 2016 | |
Restructuring And Related Activities [Abstract] | ||
Pre-tax charges | $ 3,996 | |
Operating efficiency initiatives and other items, completion date | Jan. 31, 2016 |
Operating Efficiency Initiati85
Operating Efficiency Initiatives and Other Items (Details) $ in Thousands | 12 Months Ended |
Jan. 31, 2018USD ($) | |
Restructuring Cost And Reserve [Line Items] | |
Balance at January 31, 2017 | $ 408 |
Cash payments | (135) |
Foreign exchange | 17 |
Accrued balance at January 31, 2018 | 290 |
Severance | |
Restructuring Cost And Reserve [Line Items] | |
Balance at January 31, 2017 | 78 |
Cash payments | (1) |
Foreign exchange | 5 |
Accrued balance at January 31, 2018 | 82 |
Occupancy charges | |
Restructuring Cost And Reserve [Line Items] | |
Balance at January 31, 2017 | 330 |
Cash payments | (134) |
Foreign exchange | 12 |
Accrued balance at January 31, 2018 | $ 208 |
Cost Savings Initiatives (Detai
Cost Savings Initiatives (Details Textual) $ in Thousands | 12 Months Ended | |
Jan. 31, 2018USD ($) | ||
Restructuring Cost And Reserve [Line Items] | ||
Cost savings initiative | $ 13,587 | |
Cost Savings Initiatives | ||
Restructuring Cost And Reserve [Line Items] | ||
Cost savings initiative | $ 13,587 | [1] |
[1] | The United States and International locations of the Wholesale segment include a pre-tax charge of $3.9 million and $9.7 million, respectively, for the fiscal year ended January 31, 2018. |
Cost Savings Initiatives (Det87
Cost Savings Initiatives (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2017 | ||
Restructuring Cost And Reserve [Line Items] | |||
Fiscal 2018 Charges | $ 13,587 | ||
Cash payments | (135) | ||
Foreign exchange | 17 | ||
Accrued balance at January 31, 2018 | 290 | $ 408 | |
Occupancy charges | |||
Restructuring Cost And Reserve [Line Items] | |||
Cash payments | (134) | ||
Foreign exchange | 12 | ||
Accrued balance at January 31, 2018 | 208 | $ 330 | |
Cost Savings Initiatives | |||
Restructuring Cost And Reserve [Line Items] | |||
Fiscal 2018 Charges | [1] | 13,587 | |
Cash payments | (7,776) | ||
Non-cash adjustments | (4,042) | ||
Foreign exchange | 155 | ||
Accrued balance at January 31, 2018 | 1,924 | ||
Cost Savings Initiatives | Severance and Payroll Related | |||
Restructuring Cost And Reserve [Line Items] | |||
Fiscal 2018 Charges | [1],[2] | 5,630 | |
Cash payments | [2] | (5,895) | |
Non-cash adjustments | [2] | 1,124 | |
Foreign exchange | [2] | 72 | |
Accrued balance at January 31, 2018 | [2] | 931 | |
Cost Savings Initiatives | Fixed Assets | |||
Restructuring Cost And Reserve [Line Items] | |||
Fiscal 2018 Charges | [1],[2] | 5,166 | |
Non-cash adjustments | [2] | (5,166) | |
Cost Savings Initiatives | Other | |||
Restructuring Cost And Reserve [Line Items] | |||
Fiscal 2018 Charges | [1],[2] | 2,692 | |
Cash payments | [2] | (1,847) | |
Foreign exchange | [2] | 74 | |
Accrued balance at January 31, 2018 | [2] | 919 | |
Cost Savings Initiatives | Occupancy charges | |||
Restructuring Cost And Reserve [Line Items] | |||
Fiscal 2018 Charges | [1],[2] | 99 | |
Cash payments | [2] | (34) | |
Foreign exchange | [2] | 9 | |
Accrued balance at January 31, 2018 | [2] | $ 74 | |
[1] | The United States and International locations of the Wholesale segment include a pre-tax charge of $3.9 million and $9.7 million, respectively, for the fiscal year ended January 31, 2018. | ||
[2] | The total severance and payroll related charges of $5.6 million include $4.3 million in SG&A and $1.3 million in Cost of Sales in the Consolidated Statement of Operations for the fiscal year ended January 31, 2018. The fixed assets charges of $5.2 million, other charges of $2.7 million and occupancy charges of $0.1 million are included in SG&A in the Consolidated Statement of Operations for the fiscal year ended January 31, 2018. These accrued balances are located in accrued liabilities in the Company’s Consolidated Balance Sheets. |
Cost Savings Initiatives (Det88
Cost Savings Initiatives (Details) (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 31, 2018 | Jan. 31, 2016 | |
Restructuring Cost And Reserve [Line Items] | ||
Pre-tax charges | $ 3,996 | |
Wholesale | ||
Restructuring Cost And Reserve [Line Items] | ||
Pre-tax charges | $ 4,000 | |
Cost Savings Initiatives | Wholesale | ||
Restructuring Cost And Reserve [Line Items] | ||
Pre-tax charges | $ 13,600 | |
Cost Savings Initiatives | United States | Wholesale | ||
Restructuring Cost And Reserve [Line Items] | ||
Pre-tax charges | 3,900 | |
Cost Savings Initiatives | International | Wholesale | ||
Restructuring Cost And Reserve [Line Items] | ||
Pre-tax charges | 9,700 | |
Cost Savings Initiatives | Severance and Payroll Related | ||
Restructuring Cost And Reserve [Line Items] | ||
Pre-tax charges | 5,600 | |
Cost Savings Initiatives | Severance and Payroll Related | SG&A | ||
Restructuring Cost And Reserve [Line Items] | ||
Pre-tax charges | 4,300 | |
Cost Savings Initiatives | Severance and Payroll Related | Cost of Sales | ||
Restructuring Cost And Reserve [Line Items] | ||
Pre-tax charges | 1,300 | |
Cost Savings Initiatives | Fixed Assets | SG&A | ||
Restructuring Cost And Reserve [Line Items] | ||
Pre-tax charges | 5,200 | |
Cost Savings Initiatives | Other | SG&A | ||
Restructuring Cost And Reserve [Line Items] | ||
Pre-tax charges | 2,700 | |
Cost Savings Initiatives | Occupancy charges | SG&A | ||
Restructuring Cost And Reserve [Line Items] | ||
Pre-tax charges | $ 100 |
Acquisitions (Details Textual)
Acquisitions (Details Textual) £ in Millions | Jul. 03, 2017USD ($) | Jul. 03, 2017GBP (£) | Jan. 31, 2018USD ($) | Jan. 31, 2018USD ($) | Jan. 31, 2017USD ($) |
Business Acquisition [Line Items] | |||||
Business acquisition, net of cash acquired | $ 78,991,000 | ||||
Goodwill | $ 60,269,000 | 60,269,000 | $ 0 | ||
Impairment charge of goodwill | 0 | ||||
Trade Name | |||||
Business Acquisition [Line Items] | |||||
Business combination recognized intangible assets | $ 12,800,000 | ||||
Intangible asset amortization period | 10 years | 10 years | |||
Customer Relationships | |||||
Business Acquisition [Line Items] | |||||
Business combination recognized intangible assets | $ 8,600,000 | ||||
Intangible asset amortization period | 6 years | 6 years | |||
Wholesale | |||||
Business Acquisition [Line Items] | |||||
Expenses primarily related to transaction costs and adjustments in acquisition accounting | 6,800,000 | ||||
United States | Wholesale | |||||
Business Acquisition [Line Items] | |||||
Expenses primarily related to transaction costs and adjustments in acquisition accounting | 400,000 | ||||
International | Wholesale | |||||
Business Acquisition [Line Items] | |||||
Expenses primarily related to transaction costs and adjustments in acquisition accounting | 6,400,000 | ||||
JLB Brands Ltd | |||||
Business Acquisition [Line Items] | |||||
Inventories step-up adjustment | $ 800,000 | ||||
Inventories step-up adjustment expensed over sell-through cycle | 3 months | 3 months | |||
Business combination recognized intangible assets | $ 21,415,000 | ||||
Goodwill | 55,322,000 | 60,269,000 | 60,269,000 | ||
Net sales since acquisition date | 17,800,000 | ||||
Operating income since acquisition date | 5,300,000 | ||||
Estimated amortization expense, fiscal year 2019 | 2,900,000 | 2,900,000 | |||
Estimated amortization expense, fiscal year 2020 | 2,900,000 | 2,900,000 | |||
Estimated amortization expense, fiscal year 2021 | 2,900,000 | 2,900,000 | |||
Estimated amortization expense, fiscal year 2022 | 2,900,000 | 2,900,000 | |||
Estimated amortization expense, fiscal year 2023 | 2,900,000 | 2,900,000 | |||
Estimated amortization expense, total over the next five years thereafter | $ 6,600,000 | $ 6,600,000 | |||
Olivia Burton Brand | JLB Brands Ltd | |||||
Business Acquisition [Line Items] | |||||
Business acquisition, purchase price in cash subject to working capital and other closing adjustments | 78,200,000 | £ 60 | |||
Business acquisition, net of cash acquired | 79,000,000 | 60.7 | |||
Business acquisition, cash acquired | 5,900,000 | £ 4.5 | |||
Business acquisition, debt assumed | $ 0 |
Acquisitions (Details)
Acquisitions (Details) - USD ($) | Jan. 31, 2018 | Jul. 03, 2017 | Jan. 31, 2017 |
Business Acquisition [Line Items] | |||
Goodwill | $ 60,269,000 | $ 0 | |
JLB Brands Ltd | |||
Business Acquisition [Line Items] | |||
Cash and cash equivalents | $ 5,909,000 | ||
Trade receivables, net | 3,106,000 | ||
Inventories | 4,164,000 | ||
Prepaid expenses and other current assets | 913,000 | ||
Property, plant and equipment, net | 131,000 | ||
Goodwill | $ 60,269,000 | 55,322,000 | |
Trade name and other intangibles | 21,415,000 | ||
Total assets acquired | 90,960,000 | ||
Accounts payable | 608,000 | ||
Accrued liabilities | 844,000 | ||
Income taxes payable | 643,000 | ||
Deferred and non-current income taxes payable | 3,965,000 | ||
Total liabilities assumed | 6,060,000 | ||
Total purchase price | $ 84,900,000 |
Acquisitions (Details 1)
Acquisitions (Details 1) - JLB Brands Ltd - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Jan. 31, 2018 | Jan. 31, 2017 | |
Business Acquisition [Line Items] | ||
Net sales | $ 579,217 | $ 571,321 |
Net (loss) / income | $ (8,992) | $ 37,851 |
Net (loss) / income per share attributed to Movado Group, Inc., Basic | $ (0.39) | $ 1.64 |
Net (loss) / income per share attributed to Movado Group, Inc., Diluted | $ (0.39) | $ 1.63 |
Acquisitions (Details 2)
Acquisitions (Details 2) | 12 Months Ended |
Jan. 31, 2018USD ($) | |
Business Combination Segment Allocation [Line Items] | |
Beginning Balance | $ 0 |
Ending Balance | 60,269,000 |
JLB Brands Ltd | |
Business Combination Segment Allocation [Line Items] | |
Acquisition of JLB | 55,322,000 |
Foreign exchange impact | 4,947,000 |
Ending Balance | $ 60,269,000 |
Acquisitions (Details 3)
Acquisitions (Details 3) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 31, 2018 | Jan. 31, 2017 | |
Business Acquisition [Line Items] | ||
Accumulated amortization | $ (7,300) | $ (6,800) |
Net | 30,300 | $ 8,100 |
JLB Brands Ltd | ||
Business Acquisition [Line Items] | ||
Gross carrying amount | 21,364 | |
Accumulated amortization | (1,657) | |
Foreign exchange | 1,846 | |
Net | 21,553 | |
JLB Brands Ltd | Trade Name | ||
Business Acquisition [Line Items] | ||
Gross carrying amount | 12,766 | |
Accumulated amortization | (781) | |
Foreign exchange | 1,111 | |
Net | 13,096 | |
JLB Brands Ltd | Customer Relationships | ||
Business Acquisition [Line Items] | ||
Gross carrying amount | 8,598 | |
Accumulated amortization | (876) | |
Foreign exchange | 735 | |
Net | $ 8,457 |
Valuation and Qualifying Acco94
Valuation and Qualifying Accounts (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Valuation and qualifying accounts and reserves | |||
Balance at beginning of year | $ 21,106 | $ 19,309 | $ 17,051 |
Net (benefit) / provision charged to operations | 40,188 | 40,563 | 36,143 |
Currency revaluation | 917 | 43 | (402) |
Net write-offs | (38,327) | (38,809) | (33,483) |
Adjustments | (479) | (191) | (568) |
Balance at end of year | 23,884 | 21,106 | 19,309 |
Doubtful Accounts | |||
Valuation and qualifying accounts and reserves | |||
Balance at beginning of year | 5,499 | 4,274 | 3,247 |
Net (benefit) / provision charged to operations | (176) | 1,739 | 2,251 |
Currency revaluation | 289 | 52 | (190) |
Net write-offs | (1,431) | (566) | (1,034) |
Balance at end of year | 4,181 | 5,499 | 4,274 |
Returns | |||
Valuation and qualifying accounts and reserves | |||
Balance at beginning of year | 11,648 | 10,856 | 8,736 |
Net (benefit) / provision charged to operations | 30,477 | 30,075 | 27,433 |
Currency revaluation | 288 | 10 | (147) |
Net write-offs | (30,054) | (29,293) | (25,166) |
Balance at end of year | 12,359 | 11,648 | 10,856 |
Other Sales Allowances | |||
Valuation and qualifying accounts and reserves | |||
Balance at beginning of year | 3,959 | 4,179 | 5,068 |
Net (benefit) / provision charged to operations | 9,887 | 8,749 | 6,459 |
Currency revaluation | 340 | (19) | (65) |
Net write-offs | (6,842) | (8,950) | (7,283) |
Balance at end of year | 7,344 | 3,959 | 4,179 |
Deferred Tax Asset Valuation | |||
Valuation and qualifying accounts and reserves | |||
Balance at beginning of year | 8,714 | 8,089 | 8,307 |
Net (benefit) / provision charged to operations | 628 | 716 | 986 |
Currency revaluation | 97 | 100 | (636) |
Adjustments | (479) | (191) | (568) |
Balance at end of year | $ 8,960 | $ 8,714 | $ 8,089 |
Valuation and Qualifying Acco95
Valuation and Qualifying Accounts (Parenthetical) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Valuation And Qualifying Accounts [Abstract] | |||
Prior year adjustments | $ 89 | $ 177 | |
Expiration/Expired of tax losses | $ (479) | (745) | |
Reversal due to legal entity elimination | (280) | ||
Adjustments | $ (479) | $ (191) | $ (568) |