Coach, Montblanc & Jimmy Choo drive European growth for Inter Parfums
For the second quarter of the year, French/US fragrance company Inter Parfums saw its net sales increase by 26%, compared to strong results on the same quarter in 2022 (when sales were up by 18%).
Net sales in the Western Europe region were up by 26% and in North America by 25%.
The company said it had faced challenges in the Asian region due to difficulty in the Chinese market for the first six months of 2023, but was still up 17% on Q2 2022 due to strong figures in Southeast Asia and Australia.
Coach, Jimmy Choo & Montblanc: selling well in Europe
In Europe, the (72%-owned) French subsidy Inter Parfums SA also saw net sales increase by 19% for the quarter.
Its top three brands were Coach (up 28%), Jimmy Choo (up 16%) and Montblanc (up 21%). Both Montblanc and Jimmy Choo reached sales of over $100m for the first half of 2023.
Lanvin also gained a mention for achieving modest growth in Q2 without any new launches, and Rochas too, which saw strong sales for its new launch Eau de Rochas and relaunch of Rochas Girl Life.
Jean Madar, Chairman and CEO said that growth was geographically spread across its 120-country distribution and that the company had also seen signs of “renewed life in the travel retail business.”
He also mentioned that InterParfums had taken a conservative approach to the reopening of the Chinese fragrance market and would continue to be cautious despite signs of improvement, because these were “not enough to really move the needle”.
He anticipated modest sales in China for the rest of 2023 and into 2024.
More fragrance usage & men’s sales up
In terms of consumer demand, Madar stated in the analyst earnings call that there were no signs of sales slowing.
“Products that have existed for more than 24 months are still growing, especially for larger brands such as Coach, Montblanc, Jimmy Choo, GUESS, DKNY and Donna Karan,” he shared.
“And on top of this, we have growth coming from innovation, new products, new lines, flankers, blockbusters, etc. “
Madar generally attributed the strong sales to “more fragrance usage” and said: “people may be wearing one fragrance in the morning and another in the evening.” He believed the growth was sustainable.
He also noted that the company has seen a very strong trend in its men’s fragrance business. “Men’s fragrance is smaller than women’s but growing at a very fast pace,” he shared. “Men used to only have one or two fragrances, but today they are willing to try more and we see it in our numbers.”
Gift set supply issues & Moncler disappointment
Madar also referred to supply issues the company experienced that delayed the delivery of its seasonal gift sets to retailers in 2022, and asserted that this would not be a problem this year.
“We are shipping our gift sets on time this year, so we have started to send them worldwide,” he shared. “We’ll have a much longer sell-through. We’ll start stronger advertising at the end of Q3, so we can generate business in January and February.”
One brand that had seen challenges was Montcler. In the call, the company’s CFO Michel Atwood said the high-end skiwear brand had seen large growth in the base, but now there was slowdown.
As a result, he said Inter Parfums had assessed its inventory levels and decided to write off any stock that it had that was beyond two years old.
A pipeline of new releases in Europe & US
In January this year, Inter Parfums had also signed a 15-year deal with Lacoste after the French fashion sports brand bought back its license from Coty.
While in July, it entered an exclusive worldwide fragrance license for the Roberto Cavalli brand, which will be managed by its Italian team.
Of these two new additions, Madara said: “We are well on our way in strategising and building out the products, promotions, advertising and launch schedule for the newest and upcoming licenses, Roberto Cavalli and Lacoste, while also maintaining focus on all the other iconic brands in our fragrance portfolio.”
Inter Parfums said it has a pipeline of releases for Europe for the rest of year, including new entries for the Karl Lagerfeld Les Parfums Matières collection and the debut of a new member of the Van Cleef & Arpels Collection Extraordinaire. It also plans to distribute Abercrombie & Fitch Fierce in select markets due to its popularity.
In the US, the company said that gift sets are likely to play an important role for third quarter sales and that it expected to release several extensions with a strong emphasis on the Donna Karan/DKNY, Ferragamo and Guess brands.
Speaking of the sales results and strategy for the next six months, Madar concluded: “As we look into the back half of 2023, we are confident in achieving another excellent year, as supply chain disruptions and inflationary impacts on components are mostly behind us.”
