Parlux Fragrances, Inc. (NASDAQ: PARL) announced today its results
for the three and nine-months ended December 31, 2008.
For the third quarter ended December 31, 2008, net sales
increased to $47.3 million, compared to $44.5 million for the same
prior year period, an increase of 6%. Operating expenses were $31.1
million, compared to $21.9 million for the same prior year period,
an increase of 42%. Operating loss was ($7.4 million), compared to
operating income of $0.5 million for the same prior year period.
Net loss for the three months ended December 31, 2008, was ($4.5
million), compared to net income of $0.2 million for the same prior
year period.
For the nine-months ended December 31, 2008, net sales increased
to $123.0 million, compared to $113.3 million for the same prior
year period, an increase of 9%. Operating expenses were $73.2
million, compared to $51.2 million for the same prior year period,
an increase of 43%. Operating loss was ($9.6 million), compared to
operating income of $3.9 million for the same prior year period.
Net loss for the nine-months ended December 31, 2008, was ($5.8
million), compared to net income of $2.1 million for the same prior
year period.
Neil Katz, Chairman and CEO, said, "Strategically, our focus on
strengthening our position in U.S. department stores has been a
success, with an 82% increase in sales for the third quarter ended
December 31, 2008, compared to the same prior year period. The
strategy has been expensive financially, with committed advertising
investments which could not be reduced in a retail environment
which plummeted in the November/December period. Additionally, the
global economic turmoil, compounded with a volatile U.S. dollar,
negatively impacted our International sales which declined by 34%
compared to the same prior year period, further reducing our
operating profit."
Mr. Katz continued, "For the nine-months ended December 31,
2008, we have maintained the 82% increase in U.S. department store
sales reaching a level of $45 million which will provide positive
support for our other business segments in the future. We have
successfully launched Jessica Simpson 'Fancy' and Paris Hilton
'Fairy Dust,' and have positioned ourselves for future growth with
launches of Queen Latifah and Marc Ecko planned for summer and fall
2009. Looking to the future, we continue to review and reduce costs
in all aspects of our operations and staffing, for which we believe
the benefit will commence next quarter and continue through next
fiscal year. We expect the final quarter of this fiscal year to be
profitable, assuming no further major deterioration in the global
economy."
Conference Call
The Company will host a conference call on Monday, February 9,
2009, at 9:00AM (EST) to discuss the Company's quarterly results
and to provide additional outlook on the next quarter. To
participate, please call: Participant Toll Free: 866-852-2121 or
Participant International: 416-695-9706 (no digital pin number is
required). A replay of the conference call will also be available
from Monday, February 9, 2009 after 1:00PM, until 11:59PM February
23, 2009. To access the rebroadcast, Digital Replay Toll Free:
800-408-3053 or Participant International: 416-695-5800 (Replay
Passcode: 3280300).
About Parlux Fragrances, Inc.
Parlux Fragrances, Inc. is a manufacturer and international
distributor of prestige products. It holds licenses for Paris
Hilton, Jessica Simpson, GUESS?, Nicole Miller, Natori, Queen
Latifah, Marc Ecko, XOXO, Ocean Pacific (OP), Andy Roddick,
babyGund, and Fred Hayman Beverly Hills designer fragrances, as
well as Paris Hilton watches, cosmetics, sunglasses, handbags and
other small leather accessories.
Certain Information Regarding Forward-Looking Statements
This press release includes forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended, regarding, among other things, our plans, strategies and
prospects, both business and financial. Such forward-looking
statements involve known and unknown risks, uncertainties and other
factors that may cause actual results, performance or achievements
of the Company or its industry to be materially different from any
future results, performance or achievements expressed or implied by
such forward-looking statements. These risks and uncertainties
include, among others, future trends in sales, the Company's
ability to maintain its current brands and licenses, the Company's
ability to successfully introduce, acquire, or launch new brands,
licenses, or products in a cost-effective manner, general economic
conditions, Perfumania's ability to pay its accounts payable
balance due to the Company, and continued compliance with the
covenants in its credit facility. Additional risk factors are set
forth in the Company's periodic reports filed with the Securities
and Exchange Commission. Readers are cautioned not to place undue
reliance on these forward-looking statements, which speak only as
of the date thereof. The Company undertakes no obligation to
publicly release the result of any revisions to these
forward-looking statements that may be made to reflect events or
circumstances after the date hereof or to reflect the occurrence of
unanticipated events.
PARLUX FRAGRANCES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
Three Months Ended Nine Months Ended
December 31, December 31,
-------------------------- --------------------------
2008 2007 2008 2007
------------ ------------ ------------ ------------
Net sales:
Unrelated
customers $ 38,546,367 $ 35,055,318 $ 93,839,974 $ 65,493,977
Related parties 8,746,155 9,488,470 29,148,863 47,783,702
------------ ------------ ------------ ------------
47,292,522 44,543,788 122,988,837 113,277,679
------------ ------------ ------------ ------------
Cost of goods sold:
Unrelated
customers 18,293,824 17,143,476 44,913,421 33,667,982
Related parties 5,269,761 5,009,970 14,397,501 24,448,783
------------ ------------ ------------ ------------
23,563,585 22,153,446 59,310,922 58,116,765
------------ ------------ ------------ ------------
Operating expense 31,085,949 21,896,502 73,229,720 51,224,419
------------ ------------ ------------ ------------
Operating (loss)
income from
continuing
operations (7,357,012) 493,840 (9,551,805) 3,936,495
Interest income
(expense), net 40,632 (217,067) 238,062 (1,071,394)
Other income - - - 497,770
Foreign exchange
(loss) gain (20) 11,875 (1,038) 10,034
------------ ------------ ------------ ------------
(Loss) income from
continuing
operations before
income taxes (7,316,400) 288,648 (9,314,781) 3,372,905
Income tax benefit
(provision) 2,780,232 (109,686) 3,539,617 (1,281,704)
------------ ------------ ------------ ------------
(Loss) income from
continuing
operations (4,536,168) 178,962 (5,775,164) 2,091,201
------------ ------------ ------------ ------------
Discontinued
operations:
Income from
operations of
Perry Ellis
fragrance brand - 5,999 - 40,887
Income tax
provision
related to Perry
Ellis brand - (2,280) - (15,537)
------------ ------------ ------------ ------------
Income from
discontinued
operations - 3,719 - 25,350
------------ ------------ ------------ ------------
Net (loss) income (4,536,168) 182,681 (5,775,164) 2,116,551
============ ============ ============ ============
Diluted (loss)
income per common
share:
Continuing
operations $ (0.22) $ 0.01 $ (0.28) $ 0.10
Discontinued
operations 0.00 0.00 0.00 0.00
------------ ------------ ------------ ------------
Total $ (0.22) $ 0.01 $ (0.28) $ 0.10
============ ============ ============ ============
Weighted average
diluted shares
outstanding 20,503,489 20,754,364 20,607,321 20,532,613
============ ============ ============ ============
CONDENSED CONSOLIDATED BALANCE SHEET DATA
December 31, March 31,
2008 2008
------------ ------------
$ 9,889,249 $ 21,408,167
Cash and cash equivalents 39,286,413 34,693,173
Trade receivables, net 60,460,035 48,068,280
Inventories 24,027,067 18,163,338
------------ ------------
Other current assets 133,662,764 122,332,958
Current Assets
Equipment and leasehold
improvements, net 3,054,902 4,093,091
Trademarks and licenses, net 2,110,207 2,770,211
Other assets 3,346,152 1,951,680
------------ ------------
Total Assets $142,174,025 $131,147,940
============ ============
Borrowings, current portion $ 787,186 $ 990,953
Other current liabilities 32,418,663 14,048,769
------------ ------------
Current Liabilities 33,205,849 15,039,722
Borrowings, less current
portion 3,764 542,633
------------ ------------
Total Liabilities 33,209,613 15,582,355
Stockholders' Equity 108,964,412 115,565,585
------------ ------------
Total Liabilities and
Stockholders' Equity $142,174,025 $131,147,940
============ ============
Parlux Fragrances, Inc. (954) 316-9008 CONTACT: Neil J. Katz,
Ext. 8116 Raymond J. Balsys, Ext. 8106 Web site:
http://www.parlux.com
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