Q1 2024 Inter Parfums Inc Earnings Call
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Operator: Hello and welcome to the Inter Parfums first quarter 2024 conference call and webcast. If anyone should require operator assistance, please press star zero on your telephone keypad. A question and answer session will follow the formal presentation. You may be placed into the question queue at any time by pressing star 1 on your telephone keypad.
Hello, and welcome to the inter Parfums first quarter 'twenty 'twenty four conference call and webcast, depending what you require operator assistance. Please press star zero on your telephone keypad, a question and answer session will follow the formal presentation.
Operator: Have you placed into the question queue at any time by pressing star one on your telephone keypad. As a reminder, this conference is being recorded its now my pleasure to turn the conference over to Karen Daily Vice President at the equity group and it performs Investor Relations Representative. Please go ahead Karen.
Operator: As a reminder, this conference is being recorded. It's now my pleasure to turn the conference over to Karin Daly, Vice President at the Equity Group and Inter Parfums Investment Relations Representative. Please go ahead, Karin. Thank you.
Karin Daly: Joining us on the call today will be Chairman and Chief Executive Officer Jean Madar and Chief Financial Officer Michel Atwood. On behalf of the company, I would like to note that this conference call may contain forward-looking statements that involve known and unknown risks, uncertainties, and other factors that may cause actual results to be materially different from projected results. These factors may be found in the company's filings with the Securities and Exchange Commission under the headings Forward-Looking Statements and Risk Factors in their most recent annual report on Form 10-K. Forward-looking statements speak only as of the date on which they are made, and Inter Parfums undertakes no obligation to update the information discussed.
Speaker Change: Thank you Kevin.
Speaker Change: Joining us on the call today will be chairman and Chief Executive Officer, John Matar, Chief Finance, and Chief Financial Officer, Michelle Atwood.
Karin Daly: On behalf of the company I would like to note that this conference call may contain forward looking statements, we can thought which involve known and unknown risks uncertainties and other factors that may cause actual results to be materially different from projected results. These factors may be found in the company's filings with the Securities and Exchange Commission under the head.
Karin Daly: Forward looking statements and risk factors in their most recent annual report annual report on Form 10-K.
Karin Daly: Forward looking statements speak only as of the date on which they are made and inter parfums undertakes no obligation to update the information discussed.
Karin Daly: As a reminder, our consolidated results reflect two business segments European based operations and United States based operations certain prestige fragrance products are produced and marketed by their European based operations through the 72% on French subsidiary Inter Parfums SA.
Karin Daly: When they referred to the U S based operations Inter Parfums is talking about their wholly owned subsidiaries. It is now my pleasure to turn the call over to Sean the Dar job you may begin.
Karin Daly: As a reminder, our consolidated results reflect two business segments, European-based operations and United States-based operations. Certain prestige fragrance products are produced and marketed by their European-based operations through their 72%-owned French subsidiary, Inter Parfums SA. When they refer to the U.S.-based operations, they are talking about their wholly-owned subsidiaries. It is now my pleasure to turn the call over to Jean Madar. Jean, you may begin.
Karin Daly: Okay.
Jean Madar: Thank you Karen.
Jean Madar: And good morning, everyone, and thank you for joining today's call. I have spent much of the last three months of the year traveling the world to meet with distributors, manufacturers, retailers, and boutiques. And the recurring message I hear is that the momentum in the fragrance market continues. That holds true for our business, where strong sell-in and sell-out, as well as continued premiumization, are gratifying for our customers. While sell-out was excellent in the first quarter, even sometimes higher than sell-in, we are already seeing increased demand and sales acceleration, starting in the second quarter, as the month of April can attest to.
Jean Madar: And good morning, everyone and thank you for joining today's call.
Jean Madar: I have spent much of the last three months, although you are traveling.
Jean Madar: Traveling the world to meet these distributors manufacturers retailers and boutiques.
Jean Madar: The recurring message.
Jean Madar: Is that the momentum in the fragrance market continues.
Jean Madar: That holds true for our business with stronger sell in and sell out as well as continued premium musician.
Jean Madar: Gretzky fighting facts.
Jean Madar: Why while sell out was excellent in the salesforce to even sometimes higher than selling well already increased demand and sales acceleration.
Jean Madar: Starting in the second quarter as the month of April Ken at this too.
Jean Madar: We expect further expansion in the second half. Therefore, I remain confident in our ability to achieve another record year, just as our guidance implies. As we reported, last year's first quarter was an exception, with comparable quarter sales growth of 24%, spurred by a large number of new product launches and rollouts, particularly of our leading brands. There are four.
Jean Madar: We expect some sort of expansion in the second half therefore, I remain confident in our ability to achieve and also recalled you just guidance.
Jean Madar: Our guidance implies.
Jean Madar: As we reported last year's fiscal two was an exception.
Jean Madar: With controllable cost of sales growth of 24% spurred by a large number of new product launches and Rollouts, particularly also with leading brands.
Jean Madar: Therefore, the 4% sales gain in the current so Scottsdale is still an accomplishment.
Jean Madar: The 4% sales gain in the current first quarter is still an accomplishment. Our growth primarily stemmed from continued success in our key brands, plus the addition of our newest licenses, Lacoste and Roberto Cavalli, which together drove $25 million in funding. These fragrances were well-received by retailers. In fact, we were able to maintain 90% of shelf space for these brands during the transitional developmental period. Early results are very encouraging, and with the addition of new fragrances, our 2024 goal of $90 million for Lacoste and Cavalier combined is very achievable.
Jean Madar: I will ask growth primarily stemmed from continued success in our key brands.
Jean Madar: Plus the addition of our newest licenses.
Jean Madar: And Roberto Cavalli, which combined drove $25 million and cents.
Jean Madar: These fragrances were well received by retailers in fact, we were able to maintain 90% of shelf space for these brands during the transitional developmental billions.
Jean Madar: Early results.
Jean Madar: It's very encouraging and with the addition of new fragrances.
Jean Madar: 2024, Gould of $19 million for La Costa and carefully combined is very achievable.
Jean Madar: Before I proceed, as I'm sure you all heard, Roberto Cavalli sadly passed away in Florence on April 12th. And I would like to say that he revolutionized Italian fashion and defined glamour like no other, as the king of excess, leaving a lasting mark in the world of fashion. May his legacy live on, inspiring us to embrace uniqueness as we forge new paths in fragrance creation.
Jean Madar: Before I proceed as I'm sure you're all her whole best took awhile, you said lupus to reinsurance.
Jean Madar: On a pre 12.
Jean Madar: And then we'd like to see but you evolution Italian session and defend glamour like snow as well as the king of excess leaving less to mark in the world of fashion me.
Jean Madar: Liggett's series on inspiring Gus.
Jean Madar: <unk> uniqueness as before.
Jean Madar: New paths in fragrance creation.
Jean Madar: Back to business in North America, our largest market and the slight decline in sales.
Jean Madar: North America, our largest market, had a slight decline in sales, attributable to the concentration of launches in early 2023. However, NPD research data reflect sell-out remains strong, growing double digits in comparison to prior years. Western Europe grew sales by 10%, but Eastern Europe is understandably declining in sales due to temporary sourcing constraints, which led to sales shifting from the first quarter to the second quarter. In Asia-Pacific, we are achieving further growth stemming from increased demand, especially in Australia and India. However, given the economic and social repercussions of ongoing conflicts in the Middle East and Africa, sales have declined.
Jean Madar: Tribute to ball Who's a concentration of launches in early 2023, However, NPD research data reflect the sell out remains strong.
Jean Madar: Growing double digits in comparison to prior year.
Jean Madar: We're still in Europe grew sales by 10%.
Jean Madar: But eastern Europe is understandably declining in sales due to temporary sourcing constrained, which led to sales shifting from the first quarter to the second quarter.
Jean Madar: In Asia Pacific, we are achieving sales growth stemming from increased demand, especially in Australia and India.
Jean Madar: Given the economic and social repercussions of ongoing conflicts in the Middle East and Africa sales have declined.
Jean Madar: Travel retail is finally booming again.
Jean Madar: Travel retail is finally booming again, increasing 12% during the quarter as consumers travel to explore new cultures and experience different ways of life. We are also seeing increasing shelf space and an increasing assortment of our portfolio of brands. I have personally witnessed heightened levels of travel, and with my views in line with Industry Trans, we are increasing our budget for travel retail. However, sales for our two largest brands, Montblanc and Jimmy Choo, declined during the first quarter after their respective 28% and 63% sales growth in the 2023 first quarter. Coach, guests, and Donna Karan achieved sales increases of 5%, 21%, and 44%, respectively.
Jean Madar: Increasing 12% during the course to.
Jean Madar: Consumer travel to explore nuclear chosen experience different ways of life.
Jean Madar: We're also seeing increasing shelf space and that softness although our portfolio of brands.
Jean Madar: I have personally witnessed heightened levels of travel and with my views in line with industry trends, while increasing our budget for travel retail.
Jean Madar: Sales for our two largest brands Montblanc and Jimmy Choo decline during the first quarter are still restricted 28% and 63% sales growth in the 2023 first quarter.
Jean Madar: Coach guests and then that can achieve sales increase of 5%.
Jean Madar: 21% and 44%.
Jean Madar: Let me stick TV.
Jean Madar: Coach fragrances remain in high demand, with established lines for both men and women. For guests, the combination of legacy scents and the debut of our newest fragrance, Guess Iconic, led to another quarter of significant sales growth. As such, over time, Guess could become a top three fragrance brand in our portfolio. And for the fashion house duo, Dona Karan-DKNY, we strategically launched the new Khorsand Kashmir collection in alignment with the fashion house luxury fashion campaign, which led to enormous growth in the quarter.
Jean Madar: Coach Fragrances remain in high demand.
Jean Madar: Established lines saw both men and women.
Jean Madar: So I guess the combination of legacy <unk>.
Jean Madar: The debut of our newest fragrance guess iconic led to another quarter.
Jean Madar: Significant sales growth.
Jean Madar: As such although time guests could become the top three fragrance brand in our thoughts for you.
Jean Madar: And so if the session house dual donut gone does DKNY, we strategically launched the new Boston Cashmere collection in alignment with recessions House luxury session campaign, which slate, which led to the enormous growth in the quarter.
Jean Madar: Yeah.
Jean Madar: We also achieved the expansion by several of our mid size brands, including bank enough beds, MCM and Kate Spade, we used 25% shifting to start and twister sense sales growth respectively.
Jean Madar: We also achieved further expansion for several of our mid-size brands, including Van Cleef & Arpels, MCM, and Kate Spade, with 25%, 15%, and 12% sales growth, respectively. As we mentioned in our earnings release yesterday, we have an ambitious launch strategy planned for the balance of 2024, including blockbuster fragrances for Dickie & White and Lacoste and extension for the Jimmy Choo, I Want Choo, Multi-scent collections for guest flankers are coming to market this spring, followed in the fall by a new member of the WOMO Men's Fragrance family.
Jean Madar: As we mentioned in our earnings release yesterday, we have an ambitious launch strategy plan for the balance of 2024, including blockbuster fragrances for the Gen y and lets us.
Jean Madar: And extension of the Jimmy Choo, I won't shoot and the Roberto Cavalli signature lines more.
Jean Madar: Multi scent collection for guests flankers are coming to market. This spring followed in the fall by a new member of the woman's fragrance for men.
Jean Madar: Yes, I'm all extension for Hollister NCI got more senior leader will debuted later in the year.
Jean Madar: Yeah.
Jean Madar: Beginning this year, our Italian operation started distributing brands within our.
Jean Madar: Several more, extensions for Hollister and Siragamo Signorina, will debut later in the year. Beginning this year, our Italian operation started distributing brands within our European-based operations after serving as a distribution hub for certain of our US-based brands, most notably Ferragamo in 2020. We plan to expand our Italian distribution capabilities over time. We also launched phase two of a distribution rollout for Abercrombie & Fitch during the quarter after a successful phase one distribution rollout.
Jean Madar: European based operations are still serving as a distribution hub for system. Although we are a U S based brands, most notably shall I got more in 2023.
Jean Madar: We plan to expand our Italian distribution capabilities, all the time we.
Jean Madar: We also launched phase two of a distribution rollout for our best Colombians and Fitch shifts during the quarter still a successful phase one distribution rollout, we expect to see Phil Duff says extension as we complete the phase III this year.
Jean Madar: We expect to see further sales expansion as we complete Phase 2 this year. Before turning the call over to Michel, I'm proud to report that Inter Parfums moved further up the industry ranks according to Women's Wear Daily's Annual Beauty Top 100 issue published last month, in which we placed number 30, up from 33 and 40 in 2023 and 2022 respectively. It is a nice accomplishment considering we are a pure play fragrance company competing against companies that also sell cosmetics, skin care, home fragrance, and hair care along with fragrance.
Jean Madar: Yeah.
Jean Madar: Before turning the call over to Michele I'm proud to report that does help us on module sales are up the industry racks. According to women's wear daily and Youll be teed up 100 issue published last month in which we play.
Jean Madar: Number three up from 33 and 40 in 2023 and 2022, respectively.
Michel: But it is a nice accomplishment considering well a pure play fragrance company scaled against companies that also sell cosmic cheeks, skincare fragrance and hair care along with fragrances.
Jean Madar: Yeah.
Jean Madar: So, for me, the fragrance market remains very dynamic, and Inter Parfums is committed to providing retailers and consumers with new fragrance experiences to serve their senses, curiosity, and fragrance wardrobe. We have great brands, including two new ones, a well-balanced pipeline of new product launches, and we are operating in a prestige and luxury market that remains robust. So now, I will turn the call over to Michel for a more detailed financial review. Michel?
Michel: So for me the fragrance market remains very dynamic and as these aren't that far out.
Michel: We are committed to providing retailers and consumers you fragrance experiences.
Michel: The sensors curiosity and fragrance waldrop.
Michel: We have great drugs, including two new ones.
Michel: Well balanced pipeline of new product launches.
Michel: And the operating in the prestige and luxury market that remains robust.
Michel: So now I will turn the call over to Michelle So a more detailed financial which Michelle.
Michel Atwood: Thank you, Jean, and good morning, everyone. Yesterday we reported net sales of $324 million during the first quarter of 2024, which represented 4% growth from the prior year period. This reflects flat sales for European-based operations and 18% sales growth within our U.S.-based operations.
Michel: Thank you Sal and good morning, everyone.
Michel Atwood: Yesterday, we reported net sales of $324 million during the first quarter of 'twenty 'twenty. Four this represented a 4% growth from the prior year period.
Michel Atwood: This reflects flat sales for European based operations, and 18% sales growth within our U S based operations.
Michel Atwood: The 2024 first quarter was in line with our expectations from a sales perspective. There are a few moving pieces that I would like to discuss today on today's calls that led to the 24% decline in net income. Firstly, gross margins eroded by 260 basis points on an overall basis due to unfavorable segment, geographic, and channel mix within our European-based operations. We also increased our trade spending to support the business, which was an integral part of our strategy given the limited number of fragrances we introduced earlier this year. There was also modest cost inflation in 2023 for purchases made in Europe due to higher energy costs.
Michel Atwood: The 'twenty 'twenty four first quarter was in line with our expectations from a sales perspective.
Michel Atwood: There are a few moving pieces that I would like to discuss today on today's calls that led to the 24% decline in net income.
Michel Atwood: Firstly gross margins eroded by 260 basis points on an overall basis due to unfavorable segment geographic and channel mix within our European based operations. We also increased our trade spending to support the business, which was an integral part of our strategy given the lumber.
Michel Atwood: The limited number of fragrances, we were introduced earlier this year.
Michel Atwood: It was also modest cost inflation in 'twenty to 'twenty three for purchases made in Europe due to higher energy costs and while this has subsided with the FIFO accounting method, we must use the older higher cost components in our inventory purchased at a premium.
Michel Atwood: And while this has subsided, with the FIFO accounting method, we must use the older, higher-cost components in our inventory purchased at a premium. Fortunately, these margin impacts are non-recurring and have passed, and as we go forward in 2024, we expect 2024 gross margins to be broadly in line with 2023, as we've explained previously, and we will consider potential moderate price increases in the second half of the year if needed. Within our U.S.-based operations, gross margins increased to 58.7% of net sales, primarily driven by favorable brand and channel mix. Additionally, we have increased our sales directly to retailers, as opposed to third-party distributors, due to our growing U.S. direct-to-retail business.
Michel Atwood: Fortunately these margin impacts are nonrecurring and have lifted and as we go forward in 2024.
Michel Atwood: We expect 'twenty 'twenty four gross margins to be broadly in line with 2023 as we've explained previously.
Michel Atwood: And we will consider potential moderate price increases in the second half of the year if needed.
Michel Atwood: Within our U S based operations gross margins increased to 58, 7% of net sales.
Michel Atwood: Primarily driven by favorable brand and channel mix, we have increased our sales directly to retailers as opposed to third party distributors due to our growing U S direct to retail business. The increase in sales has allowed us to continue to absorb more fixed expenses, such as depreciation and point of sale expenses as compared to the prior year period.
Michel Atwood: The increase in sales has allowed us to continue to absorb more fixed expenses such as depreciation and point of sale expenses as compared to the prior year period. So that covers off our gross margin. Now I'm gonna touch on SG&A.
Michel Atwood: Good.
Michel Atwood: So that covers off our gross margin.
Michel Atwood: I'm going to touch on SG&A, So SG&A increased to 41, 5% of net sales compared to last year's 36, 1% and this is due primarily to our increased investments in advertising and promotion, which aggregated $48 3 million.
Michel Atwood: So SG&A increased to 41.5% of net sales compared to last year's 36.1%. And this is due primarily to our increased investments in advertising and promotion, which aggregated 48.3 million and 35.2 million in the first quarter of 2024 and 2023, respectively, and this represented 14.9% of sales versus 11.3% in the prior year period. There are a couple of points we wanted to make regarding these numbers.
Michel Atwood: And $35 2 million in the first quarter of 'twenty, 'twenty, four and 2023 respectively.
Michel Atwood: This represented 14, 9% of sales versus 11, 3% in the prior year period.
Michel Atwood: So a couple of points, we wanted to make regarding these numbers first as we all know we're driving strong sell in and sell out for our newest brands Lacoste in Kibali and we're able to fill the shelf space. So I mentioned earlier. These two brands have excellent growth potential and to capitalize on that potential we invested in advertising and promotional program.
Michel Atwood: First, as we all know, we're driving strong sell-in and sell-out for our newest brands, Lacoste and Cabali, and we're able to fill the shelf space Jean mentioned earlier. These two brands have excellent growth potential, and to capitalize on that potential, we invested in advertising and promotional programs to drive those legacy fragrance lines. We also invested in new programs in preparation for the new products we are currently developing.
Michel Atwood: To drive those legacy fragrance lines, we also invested in new programs in preparation for the new products. We are currently developing.
Michel Atwood: For the year, we have again budgeted our A&P spending to be 21% of net sales.
Michel Atwood: For the year, we have again budgeted our A&P spending to be 21% of net sales. However, in 2024, as I've previously explained on many occasions, we are spreading our E&P investments somewhat more evenly over the quarters, to build brand awareness and to drive a competitive age and sustainable growth going forward. The incremental investments made in the last six months are paying off as we are seeing healthy sell-outs in stores, as explained by Jean, with double-digit growth in consumption in the U.S., for example. Royalty expenses total 8.4% during the current quarter, up from 7.7% one year earlier. This is largely driven by the brand mix.
Michel Atwood: However in 2024 as I've previously explained on them on many occasions. We are spending we are spreading our A&P investments somewhat more evenly over the quarters.
Michel Atwood: To build brand awareness and to drive our competitive age of the sustainable growth going forward the incremental investments made in the last six months are paying off as we are seeing healthy sell out in store is explained by Shaw with the double digit growth in consumption in the U S. For example.
Michel Atwood: Royalty expenses totaled eight 4% during the current quarter up from seven 7%. When your earlier this is largely driven by brand mix.
Michel Atwood: The amortization of the cost of the Lacoste licenses okay.
Michel Atwood: The amortization of the cost of the LaCoste licenses accounted for $1.6 million during the first quarter of 2024 and will continue over the life of the contract, which is 15 years. As a result of these investments, our operating margin for the first quarter of 2024 was 21 percent. It represented a return to a more normalized level compared to the abnormal and unsustainable 29 percent in the prior year's quarter. It's also more in line with what we're seeing with our competitors.
Michel Atwood: [noise] accounted for $1 6 million during the first quarter of 'twenty 'twenty four and will continue over the life of the contract which is 15 years.
Michel Atwood: As a result of these investments our operating margin for 'twenty 'twenty four first quarter was 21%. It represented a return to a more normalized level compared to the abnormal that I'm still staying above 29% in the prior year's quarter. There's also more in line with what we're seeing with our competitors.
Michel Atwood: We closed the quarter with working capital of $530 million, including approximately $100 million in cash and cash equivalents and short-term investments, resulting in a working capital ratio of 2.8 to 1. Our long-term debt, including current maturities, was $145 million at the end of the current first quarter, compared to $174 million in March 2023, associated with the Paris headquarters and the cost of licenses, and we're paying those down over time.
Michel Atwood: We closed the quarter with working capital of $530 million.
Michel Atwood: Including approximately $100 million in cash and cash equivalents and short term investments, resulting in a working capital ratio of two eight to one.
Michel Atwood: Our long term debt, including current maturities was $145 million at the end of the current first quarter compared to $174 million in March 2023.
Michel Atwood: Associated with the Paris headquarters and Lacoste, our licenses and we're paying those down overtime.
Michel Atwood: From a cash flow perspective, accounts receivable is up 20% from year end 2023. The balance is reasonable based on our sales levels and the seasonality of our business. The day sales outstanding was 73 days, only modestly higher from the corresponding period in the prior year, and we continue to see strong collection activity and do not anticipate any issues with collections given our long history and strong partnership with our retailers and distributors.
Michel Atwood: From a cash flow perspective accounts receivable was up 20% from prior year from year end 'twenty to 'twenty three the <unk>.
Michel Atwood: Balance is reasonable based on our sales levels and the seasonality of our business. The days sales outstanding was 73 days only modestly higher from the corresponding period in the prior year and we continue to see strong collection activity and do not anticipate any issues with collections, given our long history and strong partnership with our retailers and distributors.
Michel Atwood: Yeah.
Michel Atwood: Inventory levels are up 9% from year end 2023.
Michel Atwood: Inventory levels are up 9% from year-end 2023, as expected since we have consistently been building our inventory since 2021 and the additional inventory build-up from producing goods for Lacoste and Cavalli. Before I turn it back to the operator for Q&A, I will touch on our guider.
Michel Atwood: As expected since we have consistently been building our inventories since 2021 and the additional inventory buildup from producing goods for low cost in Colombia.
Michel Atwood: Before I turn it back to the operator for Q&A I will touch on our guidance.
Michel Atwood: We are again reaffirming our 2024 guidance as the tailwinds for the year far outweigh the headwinds we have faced thus far. We expect to achieve 10% annual sales growth to $1.45 billion. For further perspective, we believe the first half will be more modest, high single-digit growth, largely due to the timing of our new product launches in the first quarter, and we are expecting double-digit growth in the second half. This should lead to an 8% increase in earnings per diluted share of $5.15.
Michel Atwood: We are again, reaffirming our 2024 guidance as a tailwind for the year far outweigh the headwinds we have faced thus far we expect to achieve 10% annual sales growth to one point for a $5 billion.
Michel Atwood: For further perspective, we believe the first half will be more modest high single digit growth.
Michel Atwood: Largely due to the timing of new product launches in the first quarter and we're expecting double digit growth in the second half.
Michel Atwood: This should lead to an 8% increase in earnings per diluted share of $5.15 of note included in our guidance still of course noncash amortization expense of the acquisition cost is expected to reduce our 2024 E. P. S.
Michel Atwood: Of note included in our guidance, the LaCoste non-cash amortization expense of the acquisition cost is expected to reduce our 2024 EPS by approximately $0.11. Excluding this impact, we are projecting EPS growth of 11% versus the full year 2020. With that operator, please open the line for questions.
Michel Atwood: Approximately 11 cents.
Michel Atwood: Excluding this impact we are projecting EPS growth of 11% versus the full year 2023.
Michel Atwood: With that operator, please open the line for questions.
Operator: Certainly, we will now be conducting a question and answer session. If you would like to be placed in the question queue, please press star 1 on your telephone keypad. You may press star 2 if you would like to remove your question from the queue. One moment, please, while we poll for questions. Our first question is coming from Linda Bolton-Weiser from D.A. Davidson. Your line is now live.
Speaker Change: Certainly, we'll now be conducting a question and answer session if you'd like to be placed in the question queue. Please press star one on your telephone keypad you May press star two if he'd like to remove your question from a Q1 moment. Please while we poll for questions.
Linda Ann Bolton: Our first question is coming from Linda Bolton Weiser from D. A Davidson your line is now live.
Linda Ann Bolton: Yes, hi.
Linda Ann Bolton: Yes, hi, um... So, you know, hi, I would just like to get a little more color on the cadence among the quarters just so we get it more right, I guess, for the second quarter. Because the prior year comparison sales growth was really high, too, in the second quarter, so the comparison does not get easier. So in the second quarter, do you anticipate a little bit higher year-over-year growth in sales, or lower, or even flat sales, or maybe you could give a little color. And then also, the growth margin, I would think, would move up sequentially from the first quarter. Can you give us a little color on that? Thank you.
Speaker Change: Hi, Linda.
Linda Ann Bolton: Hi, I would just like to get a little more color on the cadence.
Linda Ann Bolton: Among the quarters, just so we get it right I guess for the second quarter.
Linda Ann Bolton: Because the prior year comparison sales growth is really high too in the second quarter. So the comparison does not get easier so in the second quarter or do you anticipate.
Linda Ann Bolton: Little bit higher year over year growth in sales or lower or even flat sales or maybe you could give a little color and then also the gross margin I would think wouldn't move up sequentially from the first quarter can you give a little color on that thank you.
Speaker Change: Yeah, Michelle Yeah. So so Linda we are are we are expecting a double digit growth in the <unk> in the second quarter.
Michel Atwood: Yeah, Linda, we are expecting double-digit growth in the second quarter. It's related to some of the shifts that we discussed between the first quarter and the second quarter, but at this point in time, we are expecting double-digit growth in the second quarter and also in the subsequent quarters for the balance of the year.
Michel Atwood: You know it's related to also some of the shifts that we've discussed between the first quarter in the second quarter, but at this point in time, we are expecting a double digit growth in the in the second quarter and also in the subsequent quarters for the for the balance of the year.
Michel Atwood: For gross margin, as you know, we had a significant charge last year in the second quarter for excess and obsolescence, which goes away. From there, there will be a significant help in gross margins in the second quarter. For the balance of the year, again, the bulk of the gain will come in the second quarter, and for the balance of the year, there'll be some marginal, at this point in time, marginal increases in gross margin.
Michel Atwood: For for the gross margin as you know we have we have a significant we had a significant charge last year in the second quarter for excess and obsolescence, which which goes away.
Michel Atwood: And I'm from there. We are we are so there will be a a significant help in gross margins in the second quarter and for the balance of the year again, we are expecting I mean, the the bulk of the gain will come into the second quarter and for the balance of the year there'll be some marginal at this point in time a marginal increases.
Michel Atwood: In gross margin, but again for the whole year, we're projecting if you're modeling. This out you should assume that the one time gain the onetime charge. We had in the second quarter will go away and then will kind of normalize for for the balance of the year to get to roughly the same gross margin as in 'twenty or 'twenty three.
Michel Atwood: But again, for the whole year, we're projecting, if you're modeling this out, you should assume that the one-time gain and the one-time charge we had in the second quarter will go away, and then we'll kind of normalize for the balance of the year to get to roughly the same gross margin as in 2020.
Michel Atwood: Yeah.
Michel Atwood: Thank you, that's very helpful. As a follow-up, is there any way you could quantify the shift in Eastern Europe related to the component shortages? How much shifted from first quarter to second quarter?
Speaker Change: Thank you that's very helpful.
Michel Atwood: Follow up is there any way you could quantify the shift in eastern Europe related to this component shortages, how much shifted from first quarter to second quarter.
Michel Atwood: We expect that it was about between two and three points.
Speaker Change: We expect that that was about between two and three points.
Speaker Change: Two to three points percentage points to 12.
Michel Atwood: Two to three percentage points of growth.
Michel Atwood: Two to three points of growth.
Michel Atwood: Two to three points of growth.
Speaker Change: Oh Wow, Okay. Thank you and then.
Jean Madar: Okay, thank you. And then... I was curious about... Cody actually really specifically said that they felt the global prestige fragrance market had accelerated in growth in the first quarter to mid-teens growth globally. Are you kind of in agreement with that, and do you have any sense of how your POS performed relative to the market in the first quarter?
Jean Madar: I was curious about.
Jean Madar: Cody actually really specifically said that they thought the global fragrance prestige fragrance market had accelerated in brown in the first quarter to mid teens growth globally.
Jean Madar: Are you kind of an agreement with that and do you have any sense for how your P. O S performed relative to the market in the first quarter.
Michel Atwood: I can try to answer, yeah, Michel, do you want to answer? No, no, no, go ahead, go ahead, absolutely.
Speaker Change: Yes, I can try to.
Speaker Change: Yeah, you said you want to answer, but I didn't even know they have got absolutely no.
Speaker Change: I tend to I tend to agree.
Jean Madar: I tend to agree with Coty, we have double-digit growth in many, many important regions. U.S., for sure, in the first quarter; Germany. Italy, France, for sure, double-digit growth; maybe it will slow down in the... But we have seen robust numbers for the first three months.
Jean Madar: We have the.
Jean Madar: The double digit growth.
Jean Madar: Many of you in Boston two regions.
Jean Madar: U S.
Jean Madar: So Scott.
Jean Madar: Gentlemen.
Jean Madar: Hum.
Jean Madar: Fun, Social Shaw group.
Jean Madar: Double digit maybe to slow down.
Jean Madar: But we have seen a robust robust.
Jean Madar: A number of smaller call themselves two months.
Jean Madar: Sure.
Michel Atwood: Yeah, definitely. I confirm that we have seen double-digit growth in the US. I think the NPD growth for the quarter was up, I think 16% if I'm not mistaken, and we've also seen low double-digit growth for most of the large European markets like Germany, the UK, Italy, and Spain. I think France was low single digits, but overall, I think the market continues to be very strong in all of the key markets and key European markets.
Michel Atwood: Yeah definitely I confirm we have seen double digit growth in the U S. I think the N P D. Our growth for the quarter was up I think 16% if I'm not mistaken and we've also seen a low double digit growth for most of the larger European markets like Germany. The U K.
Michel Atwood: Italy.
Michel Atwood: Spain, I think France was was you know low single digits, but ER, but their overall I think that the market continues to be the very strong in all of the key markets in key European markets.
Speaker Change: Great. Thank you and then just my last question is on pricing.
Linda Ann Bolton: And then just my last question is on pricing. You alluded to positive potential price increases in the second half. I mean, Cody is really talking about being very targeted, very specific, seemingly more reluctant, I guess, to take pricing.
Linda Ann Bolton: You alluded to positive.
Linda Ann Bolton: Potential price increases in second half I mean, Cody is really talking of being very targeted very specific.
Linda Ann Bolton: More reluctant to.
Jean Madar: So I'm wondering, do you think this would have some negative effect on you to take pricing if competitors are not or We are also reluctant to increase prices. We think that certain products for certain lines could have a price increase, but we do it in a very targeted way. We have not, Inter Parfums, compared to the other competitors, have not increased the price much, so we still have room. And in general, our retail prices, I'm talking about prestige fragrances, are below the competition, so we still have room. We don't want to make it a rule, we don't think that all our brands in our portfolio will have a price increase, but certain products we do.
Speaker Change: To take pricing. So I'm wondering do you think this would have some negative effect for you to take pricing as competitors or not or.
Speaker Change: Got it.
Jean Madar: Yeah.
Speaker Change: Yeah I can try.
Jean Madar: So reluctant to increase prices and we've seen that too.
Jean Madar: <unk> system for the external southern lights.
Jean Madar: <unk> do have a price.
Jean Madar: Price increase between Davita V V targeted way.
Jean Madar: We have not and desktop phone comparing to two.
Jean Madar: All the competitors.
Jean Madar: We have not to increase prices.
Jean Madar: Pricing.
Jean Madar: So we still have we still have room and in general I will.
Jean Madar: I'm talking about prestige fragrances, I wish we didn't place.
Jean Madar: Below.
Jean Madar: Good competition, so we still have.
Jean Madar: We still have them.
Jean Madar: We don't want to make it oh.
Jean Madar: We don't think that our all our brands and that hopefully you will have them.
Jean Madar: Price increase but system products.
Jean Madar: If you.
Speaker Change: Okay. Thank you very much I appreciate it. Thank you thanks Julian.
Linda Ann Bolton: Okay, thank you very much. I appreciate it. Thank you. Thank you.
Operator: Thank you. Thank you, Linda. Always a pleasure.
Speaker Change: Pleasure to kill them.
Speaker Change: Thank you as a reminder, that star one to be placed in the question queue. Our next question is coming from Permian will fire from Piper Sandler Your line is now live.
Operator: Thank you. As a reminder, that's star number one to be placed in the question queue. Our next question is coming from Korinne Wolfmeyer on Piper Sandler. Your line is now live.
Korinne N. Wolfmeyer: Hey, thanks, good morning. I'd like to first touch on the Lacoste and Cavalli sales. I think you said it was about 25 million in the quarter. Is there any way to quantify how much of that was kind of like retail inventory build versus what the proper quarterly run rate is to think about for both these brands going forward? I think previously we quantified both of them as maybe $90 million for the year. Is that still in tact, or are we tracking ahead of that?
Korinne N. Wolfmeyer: Hey, Thanks, Good morning, I'd like to first touch on the Lacoste and Kibali felt I think you said it was about $25 million in the quarter is there any way to quantify how much of that was kind of like retail inventory build versus whatever.
Unnamed: [inaudible]
Unnamed: Proper quarterly run rate is to think about for both these brands going forward I think previously you've quantified that as me.
Unnamed: $90 million for the year is that still intact or are we tracking ahead of that thanks.
Speaker Change: Oh sure.
Michel Atwood: Yeah, so Korinne, you know, when you take over a brand, there's already pretty much a pipeline that's out there. You know, the product, the brand is out there. And so, essentially, this is really replenishment of consumption in most cases. Now, obviously, when you take over a brand, you assess the landscape, and there might be additional distribution opportunities, but we'd say at this point in time, we're on both brands. We're, you know, ahead of budget for the time being, and we feel pretty confident about that $90 million for the year, and hopefully, we can finish a little higher.
Speaker Change: Yeah. So so corinne I'm you know when you take over a branch there's already pretty much up a pipeline that's out there you know the.
Michel Atwood: The brand is listed.
Michel Atwood: And so essentially this is this is really a replenishment of of of consumption. In most cases now obviously when you take over a brown do you assess the landscape.
Michel Atwood: And and there might be additional distribution opportunities, but we'd say that at this point in time, where I'm on both brands, where we're well ahead of budget for the time being and we feel pretty confident about that $19 million for the year hopefully even finished a little higher.
Speaker Change: Great. Thanks, and then on the Middle East last quarter that was a.
Jean Madar: And then on the Middle East, last quarter, that was a point of caution for you, and a reason behind the guidance that you laid out. And I think you said it declined a little bit in the quarter. Was that in line with your expectations? Was it worse? Was it better? How should we think about that region for you?
Jean Madar: Point of caution for you and a reason behind the guidance that you laid out.
Jean Madar: I think you said it was kind of a little bit in the quarter was that in track or online in line with your expectations and what's it worth was it better or how should we think about that region for you.
Jean Madar:
Jean Madar: What we see in the Middle East was in our budget, so we projected to have a certain softness in this region because of the geopolitical tension, but... We are more optimistic for the second half of the year regarding the region. So we think that sales in the important Saudi Arabia and Emirates and also countries around will pick up in the second half.
Speaker Change: What we see in the Middle East There was no there just so we projected to have the.
Jean Madar: Symptom sub space.
Jean Madar: Region.
Jean Madar: Because of the geopolitical tension.
Jean Madar: But.
Jean Madar: We have we are more optimistic for the second.
Jean Madar: Hi.
Jean Madar: Yeah regarding.
Jean Madar: So we see that too.
Jean Madar: Sales.
Jean Madar: And the important to Saudi Arabia, and Amy rates and also the countries around the.
Jean Madar: We'll pick up into the second half.
Speaker Change: Great and then if I could squeeze in one more besides maybe talk a little bit about spreading out that A&P spend over the four quarters versus the tip of.
Korinne N. Wolfmeyer: Great, and then if I could squeeze in one more question, Michelle, you talked a little bit about spreading out that AMP spend over the four quarters versus the typical seasonality we see. How should we be thinking about that? Is it really gonna be more balanced? Are we still gonna see some heavier spend in the back half? And then how does this... Please type your questions into the Q&A box.
Korinne N. Wolfmeyer: Seasonality, we see how should be thinking about that isn't really going to be more balanced or are we starting to see some heavier spend in the back half and then how does this I mean.
Korinne N. Wolfmeyer: Plan to your operating margin expectations over the next couple of quarters. Thanks.
Michelle: Oh, Yeah, that's a great great question, Kurt and I think I've been pretty consistent about the fact that we wanted to avoid some of the things that we've done in the last couple of years, where the sales comes in higher and you know and and we don't have enough runway to to spend the A&P and Gotta go wrong why are we have a bill.
Michel Atwood: Yeah, it's a great question, Korinne. I think I've been pretty consistent about the fact that we want to avoid some of the things that we did in the last couple of years where the sales come in higher and we don't have enough runway to spend on A&P and go to ROI. We have built into our financial plans a lot more front spending in order to build the momentum. The market is strong. Our brands are doing great. We've got great innovation.
Michel Atwood: Into our financial plans or I'm more upfront spending in.
Michel Atwood: In order to build the momentum that the market is strong our brands are doing great. We've got great innovation. So really the idea is to is to capitalize on that end to end to end to French spend to answer. Your question. We you know we have historically you know probably spent a 45% of our A&P.
Michel Atwood: So really, the idea is to capitalize on that and to front spend. To answer your question, we have historically probably spent 45% of our A&P or 40% of our A&P in the last quarter. We're going to continue to have pretty high spending, but we're looking for about 35% of our spending, and then it'll be spread out a little bit more evenly over quarter two and quarter three. So Q1 will continue to always be a lighter quarter in terms of spending. I think our spending was really, really, really, really low, and we needed to rebalance that.
Michel Atwood: Or 40% of our A&P and in the last quarter.
Michel Atwood: We're going to continue to have pretty high spending.
Michel Atwood: But we're looking more for about 35% of our spending and then it'll it'll be spread out a little bit more evenly over a quarter two and quarter three.
Michel Atwood: So Q1 will continue to always be a lighter quarter in terms of spending I think our spending was really really really really low and we needed to rebalance that.
Speaker Change: Great. Thanks, so much.
Michel Atwood: Thank you. Thank you. Our next question today is coming from Ashley Hogan from Jefferies. Your line is now live.
Operator: Thank you. Our next question today is coming from Ashley Helgans from Jeffries. Your line is now live.
Ashley Elizabeth Helgans: Hey, thanks for taking our question. To start on energy cost inflation, was this expected to have an impact or something that came about throughout the quarter? And then just another question on the potential price increases. Can you remind us the last time you took the price? And correct me if I'm wrong, but I feel like your competitors, maybe like Cody, were a little bit more aggressive with pricing this last year, and you guys kind of stopped taking prices.
Ashley Elizabeth Helgans: Hey, Thanks for taking our questions just to start on the energy cost inflation.
Ashley Elizabeth Helgans: It would be an impact or something that came about throughout the quarter and then just another question on the potential price increases can you remind us. The last time, you took price and correct me if I'm wrong, but I think your competitors, maybe like how do you worry a little bit more aggressive with pricing last year, and you guys kind of stopped taking price kind of midway through last year.
Ashley Elizabeth Helgans: Yeah.
Ashley Elizabeth Helgans: Yeah.
Michel Atwood: Most of the cost of goods inflation basically came in 2023, primarily driven by the higher cost of energy, which drove up the cost of glass bottles, particularly in Europe. It wasn't really a big surprise for us to see some of those costs coming through. Typically, as you've seen, we have about nine months of inventory, so some of this stuff will be coming through. I think in the last couple of quarters, it was hidden by the fact that there was also some, I would say, channel mix.
Ashley Elizabeth Helgans: Michel you want to and silver Yeah sure sure.
Michel Atwood: Oh, Yeah, sure Hey, Ashley.
Michel Atwood: No we I mean, the the the cost of goods most of the cost of goods inflation basically came in 2023, you know primarily driven by the higher cost of energies with you know drove up the cost of glass bottles, particularly in and and Ah in Europe.
Michel Atwood: It wasn't really a big surprise for us to see some of those costs coming through it typically you know as you've seen we have about nine months of inventory. So some of this stuff kind of it will be coming up will be kind of coming through.
Michel Atwood: In the last couple of quarters. It was hidden by our by our by the fact that you know are you know we have Theres also some I would say channel mix in our U S business is growing much faster as you know we have a more direct business in the U S. So the gross margins.
Michel Atwood: Our U.S. business is growing much faster. We have a more direct business in the U.S., so the gross margins are higher there, and that part of the business is growing a lot faster, so it was hiding a bit of some of that cost inflation that was making its way in. It's not really a surprise.
Michel Atwood: Are higher there and that part of the business is growing a lot faster. So it was kind of hiding. It was you know hiding a bit tough for some of that cost inflation that was kind of making its way so not really a surprise I know, it's a big number but at this point in time, you know, we're still very confident that we're going to hit our gross margin numbers for for the year, and then be more or less flat versus <unk>.
Jean Madar: I know it's a big number, but at this point in time, we're still very confident that we're going to hit our gross margin numbers for the year and be more or less flat versus prior. We're always Yes, I think we have to, yes, thank you for asking me this question because Inter Parfums has been very, very careful about the price increase in the last 18 months. Whenever we could avoid the price increase, we did, and I think we did the right thing.
Jean Madar: The prior year, we were always expecting some cost inflation.
Speaker Change: And in terms of and I'll, let John basically cover off I don't have that covers off your question on Cogs, and then I'll hand off to John I'm not the person crews.
Jean Madar: Yeah. So I think we have to do yes.
Speaker Change: Thank you for asking this question because oh.
Jean Madar: Uh-huh has been very very careful.
Jean Madar: Careful about the price increase in the loss.
Jean Madar: The 18 months whenever we can avoid the price increase and I think we need.
Jean Madar: We did the right thing.
Jean Madar: But it's true that system right.
Jean Madar: Who wants to be position to.
Jean Madar: That's a more premium level and seeking growth and they include some thinking goes.
Jean Madar: But it's true that certain brands want to be positioned at a lower price. At a more premium level, I'm thinking of VanCleef, and I'm thinking of Ferragamo. So this is where we think we have, for certain products and certain brands, the possibility to adjust retail price. But it's not at all an overall solution. The price increases. Like other people do.
Jean Madar: Got more so.
Jean Madar: So this is where we see we are.
Jean Madar: For certain products and certain brown possibility to.
Jean Madar: Two two to adjust to the retail price, but it's not at all.
Speaker Change: Who knows.
Jean Madar: Replacing trees.
Jean Madar: Okay.
Jean Madar: Like all else equal.
Speaker Change: Great. Thanks, so much.
Ashley Elizabeth Helgans: Great, thanks so much.
Speaker Change: Thank you.
Operator: Thank you. The next question is coming from Hamed Khorsand from BWS Financial. Your line is now live.
Speaker Change: Your next question is coming from <unk> <unk> from B Ws financial your line is now live.
Hamed Khorsand: Hi, Hello, Hello, Amanda.
Hamed Khorsand: Hello, I'm Hamed. Hello, Matt.
Unnamed: Hello Matt, how can I help you? The first question I had was regarding your top 5 or top 10 brands; how dependent are they on new fragrances to grow sales versus your more traditional established fragrances?
Hamed Khorsand: Hello, Matt.
Hamed Khorsand: So the first question I had was regarding your top five or top 10 brands.
Hamed Khorsand: Is it dependent are they on new frame.
Hamed Khorsand: Fragrances to you know grow sales versus your more traditional established fragrances.
Unnamed: Jean, do you want to take that?
Speaker Change: So I'll take that yeah I'm here.
Unnamed: Yeah.
Jean Madar: Overall, it's about balance. Obviously, this is an industry where you have a pretty high pace of innovation, and newness is important. You need to have a good balance of newness to keep the brand fresh. This being said, newness can come in different ways. I always use the great example of Chanel No. 5.
Jean Madar: Overall I'm, that's a great question I'll let.
Jean Madar: You know overall, it's about a it's about balance right. I mean, obviously this is an industry, where you have a pretty high pace of innovation.
Jean Madar: And newness is important and you need to have a good balance of newness to keep the brand fresh.
Jean Madar: This being said you know neither can come in different ways I can always use they are a great example of Chanel number five you know it's it's been out there for for you know 50 years, and it's been able to stay fresh not necessarily with product newness, but with commercial newness and you know we've had advertisements like Brad Pitt and stuff like that so.
Michel Atwood: It's been out there for 50 years, and it's been able to stay fresh, not necessarily with product newness but with commercial newness. We've had advertisements with Brad Pitt and stuff like that. You don't necessarily need product newness to keep the brands fresh. You need strong heroes, and that's one of the things that we're clearly trying to build. If you look at some of our larger brands, we are building strong hero pillar lines that we can leverage and build over time. Now, newness can have some impacts on pipeline, and that's typically where it comes out, but in the form of consumption, I think you can certainly build your brands up with a good [inaudible]
Michel Atwood: You don't necessarily need them, you know product newness to keep the brands fresh.
Michel Atwood: You need strong heroes and that's one of the things that we're clearly trying to built and and if you look at some of our some of our or larger or larger brands. We are building strong hero pillar mines that are that we can leverage and build over time and no nudist can have some impacts on on pipe.
Michel Atwood: And then you and I typically where it comes out but it but in the form of consumption. I think you can certainly build your brands up with a with a with with a good product and and a strong brand without necessarily having a massive amount of newness that you you need to keep the brand fresh.
Speaker Change: That's all.
Speaker Change: Yes, yes.
Jean Madar: Yes, yes, I totally agree. We need to... have a balance. Sometimes it's quite subtle, this balance between heroes, blockbusters, new pillars that for each brand we do every... I would say every three years, but every year we have to, in order to keep the newness and the novelty, we have to add line extensions or what we call, in our language, flankers. But this is the nature of the business. So you have in your portfolio existing heroes.
Michel Atwood: We would need to do.
Jean Madar: Do you have a balance.
Jean Madar: Okay.
Jean Madar: Sometimes it's quite too subtle some balance between heroes blockbuster U P. Now that we've been talking to brands, we do it.
Jean Madar: Let me see every two years.
Jean Madar: <unk>.
Jean Madar: Every year, we have moved.
Jean Madar: Two Q2 didn't mess and in energy, we have to add the line extensions all what we call an hour.
Speaker Change: Now my language.
Jean Madar: And then the.
Jean Madar: He's been at Shaw business. So you have in the portfolio.
Jean Madar: Zynga.
Jean Madar: Heroes.
Jean Madar: And every year, we come up with an extension and novelty. And, of course, different gift sets for spring and winter. But I don't say that we are dependent; this is the nature of the business; this is the way we build our model.
Jean Madar: And.
Jean Madar: Every year, we come up with the extension.
Jean Madar: Of course, you shouldn't give states so on the screen.
Jean Madar: And.
Jean Madar: Christmas season.
Jean Madar:
Jean Madar: But I don't see the real dependency.
Jean Madar: Isn't that true.
Jean Madar: This is because of it.
Jean Madar: The beauty of our model.
Jean Madar: Okay.
Jean Madar: Okay.
Hamed Khorsand: Okay, so you're not really seeing a consumer just buy a brand new fragrance, try it out, and then move on to the next one right now. That's not what I'm saying.
Speaker Change: Okay. So youre not really seeing a consumer just buy the brand new fragrance try it out and then move on to the next one right now.
Speaker Change: That's not what you're saying.
Hamed Khorsand: No not really I think that I think that they're more open to try new things.
Jean Madar: Now, not really. I think that they are more open to trying new things, but... But we have pillars in our portfolio that have been in the portfolio for more than 10 years, and they still sell, and they still grow.
Jean Madar: But.
Jean Madar: We have we have.
Jean Madar: You have to listen our whole portfolio.
Jean Madar: In the portfolio for more than 10 years.
Jean Madar: Since then and the single.
Jean Madar: Okay.
Hamed Khorsand: Okay, my last question was, regarding your ad spend, are you doing anything different as far as advertising goes? Is it a different strategy other than the spending? Are you using different avenues?
Jean Madar: Last question was.
Hamed Khorsand: Regarding your AD spend are you doing anything different as far as the advertising, particularly it yet is.
Hamed Khorsand: Is there a different strategy other than the spending.
Hamed Khorsand: Are you using different avenues for online.
Unnamed: What, Michel, do you want to answer regarding the payment of the Spangling? Yeah, I mean, overall, as you know, Ahmed, you know, most of the advertising and promotion has shifted into the digital space. I mean, typically, every brand has a different prime prospect and a different, you know, consumer. And we try to tailor that. But most of our advertising and promotion is in digital. And, you know, we've just basically put in more GRPs and, you know, spent more dollars as opposed to, you know, spending on new advertising. Yeah, yeah, absolutely, absolutely. Anything to add?
Hamed Khorsand: Michel you want to and so regarding the multiple I mean overall.
Speaker Change: Yeah, I mean overall as you know a lot of you know most of the advertising and promotion has shifted shifted into the digital space. I mean, we we typically are you know every brand has a different price point prospect in AR and a different topic, you know consumer and we try to tailor that but most of our advertising and promotion is in digital.
Speaker Change: And and you know we've just basically you know put in more G. R. PS spend more dollars as opposed to.
Speaker Change: That's supposed to you know.
Speaker Change: Spending on new avenues.
Unnamed: No.
Unnamed: Hum.
Unnamed: Sure.
Unnamed: Yeah.
Hamed Khorsand: Right. I appreciate it. Thank you.
Speaker Change: Alright I appreciate it thank you.
Speaker Change: Thank you.
Michel Atwood: Thank you. We have reached the end of our question and answer session. I'd like to turn the floor back over to Michel for any further closing comments.
Hamed Khorsand: Thank you we reached end of our question and answer session I'd like to turn the floor back over to Michelle for any further or closing comments.
Michel Atwood: Alright, well thank.
Michel Atwood: Thank you for joining our call today. Before I end the call, I would like to announce a few upcoming events. I will be both in Chicago and Milwaukee later this month with Piper Sandler, and Jean will be in Grasse with Jefferies at the end of the month. In June, I will also be in Nantucket with Jefferies at their annual consumer conference. If you are interested in attending these events, please reach out to their respective sales representatives.
Michel Atwood: Thank you for joining our call today before I hand, the call I would like to announce a few upcoming events Oh it'll be both in Chicago and Milwaukee later this month with Piper Sandler.
Michel Atwood: All will be in grass with Jefferies at the end of the month and then Juno will also be a nantucket a with the Jefferies had their annual consumer conference.
Michel Atwood: If you're interested in attending these events please reach out to our irrespective their respective sales representatives.
Michel Atwood: If you have any additional questions, please contact Karin Daly from the Equity Group or an Investor Relations representative. The telephone number and email address can be found on our most recent earnings report. We look forward to the next conference call and thank you again. Have a great day.
Michel Atwood: If you have any additional questions. Please contact Karen daily from the equity group, our Investor Relations representative.
Michel Atwood: The telephone number and email address can be found on our most recent earnings release, we look forward to the next conference call and thank you again and have a great day.
Speaker Change: Thank you that does conclude today's teleconference and webcast you may disconnect. Your lines at this time and have a wonderful day, we thank you for your participation today.
Operator: Thank you. That does conclude today's teleconference webcast. You may disconnect your line at this time and have a wonderful day. We thank you for your participation today.