Document And Entity Information
Document And Entity Information - shares | 3 Months Ended | |
Mar. 31, 2020 | May 11, 2020 | |
Document Information Line Items | ||
Entity Registrant Name | INTER PARFUMS, INC. | |
Trading Symbol | IPAR | |
Document Type | 10-Q | |
Current Fiscal Year End Date | --12-31 | |
Entity Common Stock, Shares Outstanding | 31,531,958 | |
Amendment Flag | false | |
Entity Central Index Key | 0000822663 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Document Period End Date | Mar. 31, 2020 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 0-16469 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 13-3275609 | |
Entity Address, Address Line One | 551 Fifth Avenue | |
Entity Address, City or Town | New York | |
Entity Address, State or Province | NY | |
Entity Address, Postal Zip Code | 10176 | |
City Area Code | 212 | |
Local Phone Number | 983-2640 | |
Entity Interactive Data Current | Yes | |
Title of 12(b) Security | Common Stock, $.001 par value per share | |
Security Exchange Name | NASDAQ |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 142,557 | $ 192,417 |
Short-term investments | 61,539 | 60,714 |
Accounts receivable, net | 133,640 | 133,010 |
Inventories | 169,477 | 167,809 |
Receivables, other | 2,936 | 2,054 |
Other current assets | 21,630 | 17,123 |
Income taxes receivable | 137 | 169 |
Total current assets | 531,916 | 573,296 |
Equipment and leasehold improvements, net | 11,194 | 11,107 |
Right-of-use assets, net | 27,174 | 28,359 |
Trademarks, licenses and other intangible assets, net | 196,813 | 201,983 |
Deferred tax assets | 8,285 | 8,004 |
Other assets | 6,050 | 6,083 |
Total assets | 781,432 | 828,832 |
Current liabilities: | ||
Current portion of long-term debt | 6,555 | 12,326 |
Current portion of lease liabilities | 4,960 | 5,356 |
Accounts payable - trade | 46,355 | 54,098 |
Accrued expenses | 69,343 | 96,421 |
Income taxes payable | 7,894 | 5,865 |
Dividends payable | 10,406 | 10,399 |
Total current liabilities | 145,513 | 184,465 |
Long-term debt, less current portion | 9,781 | 10,734 |
Lease liabilities, less current portion | 23,849 | 24,635 |
Equity: | ||
Preferred stock, $.001 par; authorized 1,000,000 shares; none issued | ||
Common stock, $.001 par; authorized 100,000,000 shares; outstanding 31,531,958 and 31,513,018 shares at March 31, 2020 and December 31, 2019, respectively | 31 | 31 |
Additional paid-in capital | 73,618 | 70,664 |
Retained earnings | 473,947 | 474,637 |
Accumulated other comprehensive loss | (48,097) | (39,853) |
Treasury stock, at cost, 9,864,805 shares at March 31, 2020 and December 31, 2019 | (37,475) | (37,475) |
Total Inter Parfums, Inc. shareholders' equity | 462,024 | 468,004 |
Noncontrolling interest | 140,265 | 140,994 |
Total equity | 602,289 | 608,998 |
Total liabilities and equity | $ 781,432 | $ 828,832 |
Consolidated Balance Sheets (_2
Consolidated Balance Sheets (Unaudited) (Parentheticals) - $ / shares | Mar. 31, 2020 | Dec. 31, 2019 |
Preferred stock, par value (in Dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, authorized | 1,000,000 | 1,000,000 |
Common stock, par value (in Dollars per share) | $ 0.001 | $ 0.001 |
Common stock, authorized | 100,000,000 | 100,000,000 |
Common stock, outstanding | 31,531,958 | 31,513,018 |
Treasury stock | 9,864,805 | 9,864,805 |
Consolidated Statements of Inco
Consolidated Statements of Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Net sales | $ 144,824 | $ 178,242 |
Cost of sales | 55,783 | 68,401 |
Gross margin | 89,041 | 109,841 |
Selling, general and administrative expenses | 71,262 | 76,552 |
Income from operations | 17,779 | 33,289 |
Other expenses (income): | ||
Interest expense | 1,001 | 626 |
(Gain) loss on foreign currency | (954) | 151 |
Interest income | (1,007) | (1,906) |
Other expenses (income) | (960) | (1,129) |
Income before income taxes | 18,739 | 34,418 |
Income taxes | 5,440 | 9,440 |
Net income | 13,299 | 24,978 |
Less: Net income attributable to the noncontrolling interest | 3,240 | 6,084 |
Net income attributable to Inter Parfums, Inc. | $ 10,059 | $ 18,894 |
Net income attributable to Inter Parfums, Inc. common shareholders: | ||
Basic (in Dollars per share) | $ 0.32 | $ 0.60 |
Diluted (in Dollars per share) | $ 0.32 | $ 0.60 |
Weighted average number of shares outstanding: | ||
Basic (in Shares) | 31,530 | 31,431 |
Diluted (in Shares) | 31,708 | 31,679 |
Dividends declared per share (in Dollars per share) | $ 0.33 | $ 0.28 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Comprehensive income: | ||
Net income | $ 13,299 | $ 24,978 |
Net derivative instrument gain (loss), net of tax | 257 | (59) |
Transfer from other comprehensive income into earnings | (52) | (136) |
Translation adjustments, net of tax | (11,921) | (8,545) |
Comprehensive income | 1,583 | 16,238 |
Comprehensive income attributable to the noncontrolling interests: | ||
Net income | 3,240 | 6,084 |
Net derivative instrument gain (loss), net of tax | 57 | (52) |
Translation adjustments, net of tax | (3,529) | (2,241) |
Comprehensive income (loss) attributable to the noncontrolling interests | (232) | 3,791 |
Comprehensive income attributable to Inter Parfums, Inc. | $ 1,815 | $ 12,447 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Equity (Unaudited) - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | AOCI Attributable to Parent [Member] | Treasury Stock [Member] | Noncontrolling Interest [Member] | Total |
Beginning Balance at Dec. 31, 2018 | $ 31 | $ 69,970 | $ 448,731 | $ (33,650) | $ 138,139 | ||
Shares issued upon exercise of stock options | 2,251 | ||||||
Net income | 18,894 | 6,084 | $ 24,978 | ||||
Dividends | (8,649) | ||||||
Share-based compensation (adjustment) | 350 | 353 | 321 | ||||
Purchase of subsidiary shares from noncontrolling interest | (468) | (376) | |||||
Transfer of subsidiary shares purchased | |||||||
Foreign currency translation adjustment, net of tax | (6,304) | (2,241) | |||||
Transfer from other comprehensive income into earnings | (136) | ||||||
Net derivative instrument loss, net of tax | (7) | (52) | (52) | ||||
End Balance at Mar. 31, 2019 | 72,103 | 459,329 | (40,097) | $ (37,475) | 141,875 | 595,766 | |
Beginning Balance at Dec. 31, 2019 | $ 31 | 70,664 | 474,637 | (39,853) | 140,994 | 608,998 | |
Shares issued upon exercise of stock options | 641 | ||||||
Net income | 10,059 | 3,240 | 13,299 | ||||
Dividends | (10,406) | (324) | |||||
Share-based compensation (adjustment) | 427 | (343) | (34) | ||||
Purchase of subsidiary shares from noncontrolling interest | |||||||
Transfer of subsidiary shares purchased | 1,886 | (139) | |||||
Foreign currency translation adjustment, net of tax | (8,392) | (3,529) | |||||
Transfer from other comprehensive income into earnings | (52) | ||||||
Net derivative instrument loss, net of tax | 200 | 57 | 57 | ||||
End Balance at Mar. 31, 2020 | $ 73,618 | $ 473,947 | $ (48,097) | $ (37,475) | $ 140,265 | $ 602,289 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash flows from operating activities: | ||
Net income | $ 13,299 | $ 24,978 |
Adjustments to reconcile net income to net cash used in operating activities: | ||
Depreciation and amortization | 2,230 | 2,150 |
Provision for doubtful accounts | 444 | 38 |
Lease expense | 19 | 196 |
Noncash share-based compensation | 124 | 955 |
Deferred tax benefit | (463) | (565) |
Change in fair value of derivatives | (170) | (294) |
Changes in: | ||
Accounts receivable | (4,545) | (33,385) |
Inventories | (4,702) | (6,698) |
Other assets | (3,545) | 1,738 |
Accounts payable and accrued expenses | (29,821) | (8,875) |
Income taxes, net | 2,013 | 5,156 |
Net cash used in operating activities | (25,117) | (14,606) |
Cash flows from investing activities: | ||
Purchases of short-term investments | (2,342) | (22,366) |
Proceeds from sale of short-term investments | 17,037 | |
Purchases of equipment and leasehold improvements | (1,254) | (964) |
Payment for intangible assets acquired | (460) | (53) |
Net cash used in investing activities | (4,056) | (6,346) |
Cash flows from financing activities: | ||
Repayment of long-term debt | (6,577) | (5,655) |
Proceeds from exercise of options | 641 | 2,251 |
Dividends paid | (10,399) | (8,630) |
Purchase of subsidiary shares from noncontrolling interest | (844) | |
Dividends paid to minority interest | (324) | |
Net cash used in financing activities | (16,659) | (12,878) |
Effect of exchange rate changes on cash | (4,028) | (2,924) |
Net decrease in cash and cash equivalents | (49,860) | (36,754) |
Cash and cash equivalents - beginning of period | 192,417 | 193,136 |
Cash and cash equivalents - end of period | 142,557 | 156,382 |
Supplemental disclosure of cash flow information: | ||
Interest | 462 | 301 |
Income taxes | $ 3,706 | $ 5,185 |
Significant Accounting Policies
Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies [Text Block] | 1. Significant Accounting Policies: The accounting policies we follow are set forth in the notes to our consolidated financial statements included in our Form 10-K, which was filed with the Securities and Exchange Commission for the year ended December 31, 2019. |
Impact of COVID-19 Pandemic
Impact of COVID-19 Pandemic | 3 Months Ended |
Mar. 31, 2020 | |
Impact of COVID-19 Pandemic [Abstract] | |
Impact of COVID-19 Pandemic [Text Block] | 2. Impact of COVID-19 Pandemic: A novel strain of coronavirus (“COVID-19”) surfaced in late 2019 and has spread around the world, including to the United States and France. In March 2020, the World Health Organization declared COVID-19 a pandemic. The COVID-19 pandemic has disrupted our business operations and caused a significant unfavorable impact on our results of operations. In response to the COVID-19 pandemic various national, state, and local governments where we, our suppliers, and our customers operate, have issued decrees prohibiting certain businesses from continuing to operate and certain classes of workers from reporting to work. As of the date of this filing, we have implemented travel restrictions, and we are following social distancing practices. In the U.S. and France, we are endeavoring to follow guidance from authorities and health officials including, but not limited to, requiring our personnel to wear masks and other protective clothing as appropriate, and implementing additional cleaning and sanitization routines at our distribution centers as the health and safety of our employees are paramount. Our teams are set up and now work from home and carry on business as efficiently as possible. Those decrees however, have resulted in a shutdown of a majority of retail stores selling fragrance products, a slowdown in air traffic, effecting our travel retail business, and supply chain disruption. Additionally, our distribution facilities have also experienced a short-term suspension of operations for COVID-19 employee health concerns. The duration and intensity of this global health emergency and its related disruptions are uncertain. We anticipate that retail store closings, the slowdown in air traffic, potential supply chain disruptions and short-term suspensions of activities in our distribution centers will continue to unfavorably impact our business. We also anticipate significant challenges for the remainder of 2020 due to uncertain market conditions. We expect a larger net sales decline in the second quarter of 2020, as many retail stores in our major markets may remain closed for the entire period. In addition, the COVID-19 pandemic has led to high levels of unemployment and deteriorating economic conditions in many of the countries where our products are sold, forcing many consumers to limit discretionary purchases. We believe it is possible that the impact of the COVID-19 pandemic could have a material adverse effect on the results of our operations, financial position and cash flows as of and for the year ending December 31, 2020. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 3 Months Ended |
Mar. 31, 2020 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
New Accounting Pronouncements and Changes in Accounting Principles [Text Block] | 3. Recent Accounting Pronouncements: In June 2016, the FASB issued ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments,” as updated in 2019 and 2020, which require a financial asset measured at amortized cost basis to be presented at the net amount expected to be collected. The new rules eliminate the probable initial recognition threshold and, instead, reflect an entity’s current estimate of all expected credit losses. The new rules are effective for the Company in the first quarter of 2020 and there was no material impact on our consolidated financial statements. There are no other recent accounting pronouncements issued but not yet adopted that would have a material effect on our consolidated financial statements. |
Inventories
Inventories | 3 Months Ended |
Mar. 31, 2020 | |
Inventory Disclosure [Abstract] | |
Inventory Disclosure [Text Block] | 4. Inventories: Inventories consist of the following: (In thousands) March 31, December 31, Raw materials and component parts $ 63,181 $ 71,895 Finished goods 106,296 95,914 $ 169,477 $ 167,809 |
Fair Value Measurement
Fair Value Measurement | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Disclosures [Text Block] | 5. Fair Value Measurement: The following tables present our financial assets and liabilities that are measured at fair value on a recurring basis and are categorized using the fair value hierarchy. The fair value hierarchy has three levels based on the reliability of the inputs used to determine fair value. Fair Value Measurements at March 31, 2020 Quoted Prices in Significant Other Significant Active Markets for Observable Unobservable Identical Assets Inputs Inputs Total (Level 1) (Level 2) (Level 3) Assets: Short-term investments $ 61,539 $ — $ 61,539 $ — Foreign currency forward exchange contracts accounted for using hedge accounting 131 131 Foreign currency forward exchange contracts not accounted for using hedge accounting 140 — 140 — $ 61,810 $ — $ 61,810 $ — Liabilities: Interest rate swap $ 8 $ — $ 8 $ — Fair Value Measurements at December 31, 2019 Quoted Prices in Significant Other Significant Active Markets for Observable Unobservable Identical Assets Inputs Inputs Total (Level 1) (Level 2) (Level 3) Assets: Short-term investments $ 60,714 $ — $ 60,714 $ — Foreign currency forward exchange contracts accounted for using hedge accounting 16 16 Foreign currency forward exchange contracts not accounted for using hedge accounting 112 — 112 — $ 60,842 $ — $ 60,842 $ — Liabilities: Interest rate swap $ 30 $ — $ 30 $ — The carrying amount of cash and cash equivalents including money market funds, short-term investments, accounts receivable, other receivables, accounts payable and accrued expenses approximates fair value due to the short terms to maturity of these instruments. The carrying amount of loans payable approximates fair value as the interest rates on the Company’s indebtedness approximate current market rates. Foreign currency forward exchange contracts are valued based on quotations from financial institutions and the value of interest rate swaps are the discounted net present value of the swaps using third party quotes from financial institutions. |
Derivative Financial Instrument
Derivative Financial Instruments | 3 Months Ended |
Mar. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments and Hedging Activities Disclosure [Text Block] | 6. Derivative Financial Instruments: The Company enters into foreign currency forward exchange contracts to hedge exposure related to receivables denominated in a foreign currency and occasionally to manage risks related to future sales expected to be denominated in a foreign currency. Before entering into a derivative transaction for hedging purposes, it is determined that a high degree of initial effectiveness exists between the change in value of the hedged item and the change in the value of the derivative instrument from movement in exchange rates. High effectiveness means that the change in the cash flows of the derivative instrument will effectively offset the change in the cash flows of the hedged item. The effectiveness of each hedged item is measured throughout the hedged period and is based on the dollar offset methodology and excludes the portion of the fair value of the foreign currency forward exchange contract attributable to the change in spot-forward difference which is reported in current period earnings. Any hedge ineffectiveness is also recognized as a gain or loss on foreign currency in the income statement. For hedge contracts that are no longer deemed highly effective, hedge accounting is discontinued and gains and losses accumulated in other comprehensive income are reclassified to earnings. If it is probable that the forecasted transaction will no longer occur, then any gains or losses accumulated in other comprehensive income are reclassified to current-period earnings. In connection with a 2015 brand acquisition, $108 million of the purchase price was paid in cash on the closing date and was financed entirely through a 5-year term loan. As the payment at closing was due in dollars and we had planned to finance it with debt in euro, the Company entered into foreign currency forward contracts to secure the exchange rate for the $108 million purchase price at $1.067 per 1 euro. This derivative was designated and qualified as a cash flow hedge. Gains and losses in derivatives designated as hedges are accumulated in other comprehensive income (loss) and gains and losses in derivatives not designated as hedges are included in (gain) loss on foreign currency on the accompanying income statements. Such gains and losses were immaterial for both three month periods ended March 31, 2020 and 2019. For the three months ended March 31, 2020 and 2019, interest expense was reduced by a gain of $0.02 and $0.05 million relating to the interest rate swap. All derivative instruments are reported as either assets or liabilities on the balance sheet measured at fair value. The valuation of interest rate swaps resulted in a liability which is included in long-term debt on the accompanying balance sheets. The valuation of foreign currency forward exchange contracts at March 31, 2020, resulted in an asset and is included in other current assets on the accompanying balance sheet. At March 31, 2020, we had foreign currency contracts in the form of forward exchange contracts in the amount of approximately U.S. $40.0 million, GB £1.0 million and JPY ¥170.0 million which all have maturities of less than one year. |
Leases
Leases | 3 Months Ended |
Mar. 31, 2020 | |
Disclosure Text Block [Abstract] | |
Lessee, Operating Leases [Text Block] | 7. Leases: The Company leases its offices and warehouses, vehicles, and certain office equipment, substantially all of which are classified as operating leases. The Company currently has no material financing leases. The Company determines if an arrangement is a lease at inception. Operating lease assets and obligations are recognized at the lease commencement date based on the present value of lease payments over the lease term. In determining lease asset value, the Company considers fixed or variable payment terms, prepayments, incentives, and options to extend or terminate, depending on the lease. Renewal, termination or purchase options affect the lease term used for determining lease asset value only if the option is reasonably certain to be exercised. The Company generally uses its incremental borrowing rate based on information available at the lease commencement date for the location in which the lease is held in determining the present value of lease payments. As of March 31, 2020, the weighted average remaining lease term was 6.3 years and the weighted average discount rate used to determine the operating lease liability was 2.8%. Rental expense related to operating leases was $1.8 million for both periods ending March 31, 2020 and 2019. Operating lease payments included in operating cash flows totaled $1.6 million for both three months ended March 31, 2020 and 2019 and noncash additions to operating lease assets totaled $0.7 million and $31.8 million for the three months ended March 31, 2020 and 2019, respectively. |
Share-Based Payments
Share-Based Payments | 3 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Share-based Payment Arrangement [Text Block] | 8. Share-Based Payments: The Company maintains a stock option program for key employees, executives and directors. The plans, all of which have been approved by shareholder vote, provide for the granting of both nonqualified and incentive options. Options granted under the plans typically have a six-year term and vest over a four five-year The following table sets forth information with respect to nonvested options for the three month period ended March 31, 2020: Number of Weighted Average Nonvested options – beginning of period 514,210 $ 12.36 Nonvested options granted 9,000 $ 12.16 Nonvested options vested or forfeited (10,180 ) $ 10.10 Nonvested options – end of period 513,030 $ 12.40 Share-based payment expense decreased income before income taxes by $0.12 million and $0.96 million for the three months ended March 31, 2020 and 2019, respectively, and decreased net income attributable to Inter Parfums, Inc. by $0.18 million and $0.58 million for the three months ended March 31, 2020 and 2019. The following table summarizes stock option information as of March 31, 2020: Shares Weighted Average Exercise Price Outstanding at January 1, 2020 815,800 $ 49.89 Options granted 9,000 69.11 Options forfeited (2,140 ) 57.03 Options exercised (18,940 ) 33.82 Outstanding at March 31, 2020 803,720 $ 50. 46 Options exercisable 290,690 $ 35.09 Options available for future grants 566,835 As of March 31, 2020, the weighted average remaining contractual life of options outstanding is 3.78 years (2.38 years for options exercisable); the aggregate intrinsic value of options outstanding and options exercisable is $5.3 million and $3.9 million, respectively; and unrecognized compensation cost related to stock options outstanding aggregated $5.6 million. Cash proceeds, tax benefits and intrinsic value related to stock options exercised during the three months ended March 31, 2020 and March 31, 2019 were as follows: (In thousands) March 31, March 31, Cash proceeds from stock options exercised $ 641 $ 2,251 Tax benefits — 300 Intrinsic value of stock options exercised 733 2,226 The weighted average fair values of the options granted by Inter Parfums, Inc. during the three months ended March 31, 2020 and 2019 were $12.16 and $14.83 per share, respectively, on the date of grant using the Black-Scholes option pricing model to calculate the fair value of options granted. The assumptions used in the Black-Scholes pricing model for the periods ended March 31, 2020 and 2019 are set forth in the following table: March 31, March 31, Weighted average expected stock-price volatility 25 % 27 % Weighted average expected option life 5 years 5 years Weighted average risk-free interest rate 1.4 % 2.5 % Weighted average dividend yield 2.5 % 2.0 % Expected volatility is estimated based on historic volatility of the Company’s common stock. The expected term of the option is estimated based on historic data. The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of the grant of the option and the dividend yield reflects the assumption that the dividend payout as authorized by the Board of Directors would increase as the earnings of the Company and its stock price continue to increase. In December 2018, Interparfums SA, our 73% owned French subsidiary, approved a plan to grant an aggregate of 26,600 shares of its stock to employees with no performance condition requirement, and an aggregate of 133,000 shares to officers and managers, subject to certain corporate performance conditions. The shares, subject to adjustment for stock splits, will be distributed in June 2022. In order to avoid dilution of the Company’s ownership of Interparfums SA, all shares to be distributed pursuant to the plan will be pre-existing shares of Interparfums SA, purchased in the open market by Interparfums SA in prior years. In March 2020, due to the potential impact on future net sales and operating results resulting from the COVID-19 pandemic, the estimated number of shares to be distributed, after forfeited shares, was reduced from 142,571 to 82,162. As the Company had already purchased shares in contemplation of the higher anticipated distribution, shares purchased in excess of the reduced anticipated distribution were transferred to treasury shares at Interparfums SA level. Employee turnover was also taken into account in the calculation. The fair value of the grant had been determined based on the quoted stock price of Interparfums SA shares as reported by the NYSE Euronext on the date of grant. The original cost of the grant was approximately $4.4 million, and the March 2020 revaluation resulted in a reduction of the cost, to approximately $2.5 million. As a result, a $0.3 million reduction of cost, net, was recorded for the three months ended March 31, 2020. |
Net Income Attributable to Inte
Net Income Attributable to Inter Parfums, Inc. Common Shareholders | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Earnings Per Share [Text Block] | 9. Net Income Attributable to Inter Parfums, Inc. Common Shareholders: Net income attributable to Inter Parfums, Inc. per common share (“basic EPS”) is computed by dividing net earnings attributable to Inter Parfums, Inc. by the weighted average number of shares outstanding. Net earnings attributable to Inter Parfums, Inc. per share assuming dilution (“diluted EPS”), is computed using the weighted average number of shares outstanding, plus the incremental shares outstanding assuming the exercise of dilutive stock options using the treasury stock method. The reconciliation between the numerators and denominators of the basic and diluted EPS computations is as follows: Three months ended (In thousands, except per share data) March 31, 2020 2019 Numerator: Net income attributable to Inter Parfums, Inc. $ 10,059 $ 18,894 Denominator: Weighted average shares 31,530 31,431 Effect of dilutive securities: Stock options 178 248 Denominator for diluted earnings per share 31,708 31,679 Earnings per share: Net income attributable to Inter Parfums, Inc. common shareholders: Basic $ 0.32 $ 0.60 Diluted 0.32 0.60 Not included in the above computations is the effect of antidilutive potential common shares which consist of outstanding options to purchase 0.37 and 0.18 million shares of common stock for the three months ended March 31, 2020 and 2019, respectively. |
Segment and Geographic Areas
Segment and Geographic Areas | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Segment Reporting Disclosure [Text Block] | 10. Segment and Geographic Areas: The Company manufactures and distributes one product line, fragrances and fragrance related products. The Company manages its business in two segments, European based operations and United States based operations. The European assets are located, and operations are primarily conducted, in France. European operations primarily represent the sale of prestige brand name fragrances and United States operations primarily represent the sale of prestige brand name and specialty retail fragrance. Information on our operations by geographical areas is as follows: (In thousands) Three months ended 2020 2019 Net sales: United States $ 31,618 $ 35,616 Europe 114,123 143,767 Eliminations (917 ) (1,141 ) $ 144,824 $ 178,242 Net income attributable to Inter Parfums, Inc.: United States $ 1,606 $ 2,887 Europe 8,453 16,007 $ 10,059 $ 18,894 March 31, December 31, Total Assets: United States $ 148,547 $ 166,180 Europe 646,984 670,657 Eliminations of investment in subsidiary (14,099 ) (8,005 ) $ 781,432 $ 828,832 |
Recent Agreements
Recent Agreements | 3 Months Ended |
Mar. 31, 2020 | |
Recent Agreements [Abstract] | |
Recent Agreements [Text Block] | 11. Recent Agreements: S.T. Dupont In January 2020, we renewed our license agreement with S.T. Dupont for the creation, development and distribution of fragrance products through December 31, 2020, without any material changes in terms and conditions. Our initial 11-year license agreement with S.T. Dupont was signed in June 1997, and had previously been extended through December 31, 2019. The agreement will be extended annually in September of each year upon mutual consent. |
Reclassifications
Reclassifications | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Reclassifications [Text Block] | 12. Reclassifications: Certain prior year’s amounts in the accompanying consolidated balance sheet and statements of cash flows have been reclassified to conform to current period presentation. |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory, Current [Table Text Block] | (In thousands) March 31, December 31, Raw materials and component parts $ 63,181 $ 71,895 Finished goods 106,296 95,914 $ 169,477 $ 167,809 |
Fair Value Measurement (Tables)
Fair Value Measurement (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Table Text Block] | Fair Value Measurements at March 31, 2020 Quoted Prices in Significant Other Significant Active Markets for Observable Unobservable Identical Assets Inputs Inputs Total (Level 1) (Level 2) (Level 3) Assets: Short-term investments $ 61,539 $ — $ 61,539 $ — Foreign currency forward exchange contracts accounted for using hedge accounting 131 131 Foreign currency forward exchange contracts not accounted for using hedge accounting 140 — 140 — $ 61,810 $ — $ 61,810 $ — Liabilities: Interest rate swap $ 8 $ — $ 8 $ — Fair Value Measurements at December 31, 2019 Quoted Prices in Significant Other Significant Active Markets for Observable Unobservable Identical Assets Inputs Inputs Total (Level 1) (Level 2) (Level 3) Assets: Short-term investments $ 60,714 $ — $ 60,714 $ — Foreign currency forward exchange contracts accounted for using hedge accounting 16 16 Foreign currency forward exchange contracts not accounted for using hedge accounting 112 — 112 — $ 60,842 $ — $ 60,842 $ — Liabilities: Interest rate swap $ 30 $ — $ 30 $ — |
Share-Based Payments (Tables)
Share-Based Payments (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Nonvested Share Activity [Table Text Block] | Number of Weighted Average Nonvested options – beginning of period 514,210 $ 12.36 Nonvested options granted 9,000 $ 12.16 Nonvested options vested or forfeited (10,180 ) $ 10.10 Nonvested options – end of period 513,030 $ 12.40 |
Share-based Payment Arrangement, Option, Activity [Table Text Block] | Shares Weighted Average Exercise Price Outstanding at January 1, 2020 815,800 $ 49.89 Options granted 9,000 69.11 Options forfeited (2,140 ) 57.03 Options exercised (18,940 ) 33.82 Outstanding at March 31, 2020 803,720 $ 50. 46 Options exercisable 290,690 $ 35.09 Options available for future grants 566,835 |
Cash Proceeds Received and Tax Benefit from Share-based Payment Awards [Table Text Block] | (In thousands) March 31, March 31, Cash proceeds from stock options exercised $ 641 $ 2,251 Tax benefits — 300 Intrinsic value of stock options exercised 733 2,226 |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block] | March 31, March 31, Weighted average expected stock-price volatility 25 % 27 % Weighted average expected option life 5 years 5 years Weighted average risk-free interest rate 1.4 % 2.5 % Weighted average dividend yield 2.5 % 2.0 % |
Net Income Attributable to In_2
Net Income Attributable to Inter Parfums, Inc. Common Shareholders (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | Three months ended (In thousands, except per share data) March 31, 2020 2019 Numerator: Net income attributable to Inter Parfums, Inc. $ 10,059 $ 18,894 Denominator: Weighted average shares 31,530 31,431 Effect of dilutive securities: Stock options 178 248 Denominator for diluted earnings per share 31,708 31,679 Earnings per share: Net income attributable to Inter Parfums, Inc. common shareholders: Basic $ 0.32 $ 0.60 Diluted 0.32 0.60 |
Segment and Geographic Areas (T
Segment and Geographic Areas (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment [Table Text Block] | (In thousands) Three months ended 2020 2019 Net sales: United States $ 31,618 $ 35,616 Europe 114,123 143,767 Eliminations (917 ) (1,141 ) $ 144,824 $ 178,242 Net income attributable to Inter Parfums, Inc.: United States $ 1,606 $ 2,887 Europe 8,453 16,007 $ 10,059 $ 18,894 March 31, December 31, Total Assets: United States $ 148,547 $ 166,180 Europe 646,984 670,657 Eliminations of investment in subsidiary (14,099 ) (8,005 ) $ 781,432 $ 828,832 |
Inventories (Details) - Schedul
Inventories (Details) - Schedule of inventories - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Inventory Disclosure [Abstract] | ||
Raw materials and component parts | $ 63,181 | $ 71,895 |
Finished goods | 106,296 | 95,914 |
Inventories | $ 169,477 | $ 167,809 |
Fair Value Measurement (Details
Fair Value Measurement (Details) - Schedule of fair value, assets measured on recurring basis - Fair Value, Recurring [Member] - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Assets: | ||
Short-term investments | $ 61,539 | $ 60,714 |
Foreign currency forward exchange contracts accounted for using hedge accounting | 131 | 16 |
Foreign currency forward exchange contracts not accounted for using hedge accounting | 140 | 112 |
Total Assets | 61,810 | 60,842 |
Liabilities: | ||
Interest rate swap | 8 | 30 |
Fair Value, Inputs, Level 1 [Member] | ||
Assets: | ||
Short-term investments | ||
Foreign currency forward exchange contracts accounted for using hedge accounting | ||
Foreign currency forward exchange contracts not accounted for using hedge accounting | ||
Total Assets | ||
Liabilities: | ||
Interest rate swap | ||
Fair Value, Inputs, Level 2 [Member] | ||
Assets: | ||
Short-term investments | 61,539 | 60,714 |
Foreign currency forward exchange contracts accounted for using hedge accounting | 131 | 16 |
Foreign currency forward exchange contracts not accounted for using hedge accounting | 140 | 112 |
Total Assets | 61,810 | 60,842 |
Liabilities: | ||
Interest rate swap | 8 | 30 |
Fair Value, Inputs, Level 3 [Member] | ||
Assets: | ||
Short-term investments | ||
Foreign currency forward exchange contracts accounted for using hedge accounting | ||
Foreign currency forward exchange contracts not accounted for using hedge accounting | ||
Total Assets | ||
Liabilities: | ||
Interest rate swap |
Derivative Financial Instrume_2
Derivative Financial Instruments (Details) $ in Thousands, ¥ in Millions, £ in Millions | 3 Months Ended | 12 Months Ended | |||
Mar. 31, 2020USD ($) | Mar. 31, 2019USD ($) | Dec. 31, 2015USD ($) | Mar. 31, 2020GBP (£) | Mar. 31, 2020JPY (¥) | |
Derivative Financial Instruments (Details) [Line Items] | |||||
Derivative, gain (loss) on derivative, net, total | $ 20 | $ 50 | |||
Foreign Exchange Contract [Member] | |||||
Derivative Financial Instruments (Details) [Line Items] | |||||
Foreign Currency Contracts, Liability, Fair Value Disclosure | $ 40,000 | £ 1 | ¥ 170 | ||
Trademarks [Member] | Medium-term Notes [Member] | Rochas Brand [Member] | |||||
Derivative Financial Instruments (Details) [Line Items] | |||||
Cash paid for acquisition and financed by loan, amount | $ 108,000 | ||||
Cash paid for acquisition and financed by loan, term | 5 years | ||||
Trademarks [Member] | Foreign Exchange Contract [Member] | Medium-term Notes [Member] | Rochas Brand [Member] | |||||
Derivative Financial Instruments (Details) [Line Items] | |||||
Notional amount | $ 108,000 | ||||
Exchange rate (in dollars per euro) | 1 | 1.067 | 1 | 1 |
Leases (Details)
Leases (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Leases Abstract | ||
Weighted average remaining lease term | 6 years 3 months 18 days | |
Operating lease, weighted average discount rate | 2.80% | |
Operating lease related expenses | $ 1.8 | $ 1.8 |
Operating lease payments | 1.6 | 1.6 |
Noncash additions to operating lease assets | $ 0.7 | $ 31.8 |
Share-Based Payments (Details)
Share-Based Payments (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2018 | |
Share-Based Payments (Details) [Line Items] | |||
Share-based Payment Arrangement, Expense | $ 120 | $ 960 | |
Allocated share-based compensation expense, effect on net income attributable to parent | $ 180 | $ 580 | |
Weighted average remaining contractual life of options exercisable | 3 years 9 months 10 days | ||
Weighted average remaining contractual life of options outstanding, options exercisable | 2 years 4 months 17 days | ||
Aggregate intrinsic value of options outstanding | $ 5,300 | ||
Aggregate intrinsic value of exercisable options | 3,900 | ||
Unrecognized compensation cost related to stock options | 5,600 | ||
Weighted average grant date fair value (in Dollars per share) | $ 12.16 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost | $ 2,500 | ||
Reduction of cost, net | $ 300 | ||
Interparfums SA Subsidiary [Member] | |||
Share-Based Payments (Details) [Line Items] | |||
Ownership percentage in Interparfums SA | 73.00% | ||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized (in Shares) | 142,571 | 133,000 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost | $ 4,400 | ||
Equity Option [Member] | |||
Share-Based Payments (Details) [Line Items] | |||
Fair value of shares vested | $ 80 | $ 60 | |
Weighted average grant date fair value (in Dollars per share) | $ 12.16 | $ 14.83 | |
Equity Option [Member] | Minimum [Member] | |||
Share-Based Payments (Details) [Line Items] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 4 years | ||
Equity Option [Member] | Maximum [Member] | |||
Share-Based Payments (Details) [Line Items] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 5 years | ||
Employees [Member] | Interparfums SA Subsidiary [Member] | |||
Share-Based Payments (Details) [Line Items] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized (in Shares) | 26,600 | ||
Officers And Managers [Member] | Interparfums SA Subsidiary [Member] | |||
Share-Based Payments (Details) [Line Items] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized (in Shares) | 82,162 |
Share-Based Payments (Details)
Share-Based Payments (Details) - Schedule of nonvested share activity | 3 Months Ended |
Mar. 31, 2020$ / sharesshares | |
Equity [Abstract] | |
Number of Shares Grant Date | shares | 514,210 |
Weighted Average Grant Date Fair Value Grant Date | $ / shares | $ 12.36 |
Number of Shares Grant Date | shares | 9,000 |
Weighted Average Grant Date Fair Value Grant Date | $ / shares | $ 12.16 |
Number of Shares Grant Date | shares | (10,180) |
Weighted Average Grant Date Fair Value Grant Date | $ / shares | $ 10.10 |
Number of Shares Grant Date | shares | 513,030 |
Weighted Average Grant Date Fair Value Grant Date | $ / shares | $ 12.40 |
Share-Based Payments (Details_2
Share-Based Payments (Details) - Schedule of stock options, activity | 3 Months Ended |
Mar. 31, 2020$ / sharesshares | |
Equity [Abstract] | |
Options Outstanding | shares | 815,800 |
Weighted Average Exercise Price, Options Outstanding | $ / shares | $ 49.89 |
Options granted | shares | 9,000 |
Weighted Average Exercise Price, Options granted | $ / shares | $ 69.11 |
Options forfeited | shares | (2,140) |
Weighted Average Exercise Price, Options forfeited | $ / shares | $ 57.03 |
Options exercised | shares | (18,940) |
Weighted Average Exercise Price, Options exercised | $ / shares | $ 33.82 |
Options Outstanding | shares | 803,720 |
Weighted Average Exercise Price, Options Outstanding | $ / shares | $ 50.46 |
Options exercisable | shares | 290,690 |
Weighted Average Exercise Price, Options exercisable | $ / shares | $ 35.09 |
Options available for future grants | shares | 566,835 |
Weighted Average Exercise Price, Options available for future grants | $ / shares |
Share-Based Payments (Details_3
Share-Based Payments (Details) - Schedule of stock options exercised - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Equity [Abstract] | ||
Cash proceeds from stock options exercised | $ 641 | $ 2,251 |
Tax benefits | 300 | |
Intrinsic value of stock options exercised | $ 733 | $ 2,226 |
Share-Based Payments (Details_4
Share-Based Payments (Details) - Schedule of valuation assumptions in Black-Scholes pricing | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Equity [Abstract] | ||
Weighted average expected stock-price volatility | 25.00% | 27.00% |
Weighted average expected option life | 5 years | 5 years |
Weighted average risk-free interest rate | 1.40% | 2.50% |
Weighted average dividend yield | 2.50% | 2.00% |
Net Income Attributable to In_3
Net Income Attributable to Inter Parfums, Inc. Common Shareholders (Details) - shares | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Earnings Per Share [Abstract] | ||
Antidilutive securities excluded from computation of earnings per share, amount | 0.37 | 0.18 |
Net Income Attributable to In_4
Net Income Attributable to Inter Parfums, Inc. Common Shareholders (Details) - Schedule of earnings per share, basic and diluted - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Numerator: | ||
Net income attributable to Inter Parfums, Inc. (in Dollars) | $ 10,059 | $ 18,894 |
Denominator: | ||
Weighted average shares | 31,530 | 31,431 |
Effect of dilutive securities: | ||
Stock options | 178 | 248 |
Denominator for diluted earnings per share | 31,708 | 31,679 |
common shareholders: | ||
Basic (in Dollars per share) | $ 0.32 | $ 0.60 |
Diluted (in Dollars per share) | $ 0.32 | $ 0.60 |
Segment and Geographic Areas (D
Segment and Geographic Areas (Details) - Schedule of company's operations by geographical areas - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Net sales: | |||
Net sales | $ 144,824 | $ 178,242 | |
Net income attributable to Inter Parfums, Inc.: | |||
Net income attributable to Inter Parfums, Inc | 10,059 | 18,894 | |
Total Assets: | |||
Total assets | 781,432 | $ 828,832 | |
UNITED STATES | |||
Net sales: | |||
Net sales | 31,618 | 35,616 | |
Net income attributable to Inter Parfums, Inc.: | |||
Net income attributable to Inter Parfums, Inc | 1,606 | 2,887 | |
Total Assets: | |||
Total assets | 148,547 | 166,180 | |
Europe [Member] | |||
Net sales: | |||
Net sales | 114,123 | 143,767 | |
Net income attributable to Inter Parfums, Inc.: | |||
Net income attributable to Inter Parfums, Inc | 8,453 | 16,007 | |
Total Assets: | |||
Total assets | 646,984 | 670,657 | |
Intersegment Eliminations [Member] | |||
Net sales: | |||
Net sales | (917) | $ (1,141) | |
Total Assets: | |||
Total assets | $ (14,099) | $ (8,005) |
Recent Agreements (Details)
Recent Agreements (Details) | 3 Months Ended |
Mar. 31, 2020 | |
S.T. Dupont [Member] | |
Recent Agreements (Details) [Line Items] | |
License agreements, description | Our initial 11-year license agreement with S.T. Dupont was signed in June 1997, and had previously been extended through December 31, 2019. The agreement will be extended annually in September of each year upon mutual consent. |