Q2 2025 Movado Group Inc Earnings Call

September 5, 2024

Unknown Attendee: Reporting everyone. With me on the call is Efraim Grinberg, Chairman and Chief Executive Officer, and Sallie DeMarsilis, Executive Vice President and Chief Operating Officer and Chief Financial Officer.

Good morning, everyone with me on the call is affirmed Greenberg, Chairman and Chief Executive Officer, and Sallie, The Marcellus Executive Vice President and Chief operating Officer, and Chief Financial Officer before we get started I would like to remind you of the company's safe Harbor language, which I'm sure you're all familiar with.

Unknown Attendee: Before we get started, I would like to remind you of the company's safe harbor language, which I'm sure you're all familiar with. The statements contained in this conference call, which are not historical facts, may be deemed to constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual future results may differ materially from those suggested in such statements due to a number of risks and uncertainties, all of which are described in the company's filings with the SEC, which includes today's press release.

The statements contained in this conference call, which are not historical facts may be deemed to constitute forward looking statements within the meaning of the private Securities Litigation Reform Act of 1995.

Actual future results may differ materially from those suggested in such statements due to a number of risks and uncertainties.

All of which are described in the company's filings with the SEC, which includes today's press release, if any non-GAAP financial measure is used on this call a presentation of the most directly comparable GAAP financial measure to this non-GAAP financial measure will be provided as supplemental financial information.

Unknown Attendee: If any non-GAAP financial measure is used on this call, a presentation of the most directly comparable GAAP financial measure to this non-GAAP financial measure will be provided as supplemental financial information in our press release.

In our press release.

Efraim Grinberg: Now, I would like to turn the call over to Efraim Grinberg, Chairman and Chief Executive Officer of Movado Group. Thank you, Allison. Good morning, and thank you for joining us today. I am pleased to share our second quarter of performance as we make progress advancing our strategy in a challenging consumer spending environment. We improved our sales trends from the first to the second quarter, reporting virtually flat net sales on a constant dollar basis to last year. Our operating profit declined to $3 million, driven by increased marketing investments that are expected to accelerate sales growth in the future.

Speaker Change: Now I would like to turn the call over to after I'm gone back Chairman and Chief Executive Officer of Nevada.

Yeah.

Speaker Change: Thank you thank you Allison.

Speaker Change: Good morning, and thank you for joining us today I am pleased to share our second quarter performance as we make progress advancing our strategy in a challenging consumer spending environment, we improved our sales trends from the first to the second quarter reporting virtually flat flat net sales on a constant dollar basis to last year.

Speaker Change: Our operating profit declined to $3 million driven by increased marketing investments that are expected to accelerate sales growth in the future. We maintained a healthy gross margin with the rates declining versus the second quarter last year due to the overall mix of our business our balance sheet remains strong with $198 million in cash.

Efraim Grinberg: We maintained a healthy growth margin, with the rate declining versus the second quarter last year due to the overall mix of our business. Our balance sheet remains strong with $198 million in cash and no debt. Inventory increased from the beginning of the fiscal year to support our sales expectations for the second half of the year. Across geographies, our retail partners placed orders cautiously, especially in Europe and the US, where customers are maintaining lower levels of inventory in a challenging consumer spending environment. Despite this, we were pleased to see a favorable response to our increased marketing investment.

Speaker Change: Note that inventory increase from the beginning of the fiscal year to support our sales expectations for the second half of the year across geographies, our retail partners placed orders cautiously, especially in Europe, and the U S where customers are maintaining lower levels of inventory and a challenging consumer spending environment.

Speaker Change: Fight. This we were pleased to see a favorable response to our increased marketing investment. We saw increased increased interest across our brands with unit volume in our licensed brands increasing by 10%.

Efraim Grinberg: We saw increased interest across our brands, with unit volume and our license brands increasing by 10 percent, buoyed by our marketing efforts and the reintroduction of certain price points that we had previously vacated across our brands. In our Movado brand, sales grew by 1.4 percent with growth in the direct-to-consumer channels, including a 21 percent increase in Movado.com, mostly offset by a 6 percent decline in our wholesale channel.

Speaker Change: Buoyed by our marketing efforts and the reintroduction of certain price points that we had previously vacated across our brands and our Novato brand sales grew by one 4% with growth in the direct to consumer channel, including 21% increase in Novato dotcom, mostly offset by a 6% decline in our wholesale.

Speaker Change: Channel, while we are pleased that we have improved our retail trends overall, we recognize that the global operating environment remains challenging for retail in the watch category in particular with our highest heightened level of uncertainty and we believe this will have an impact on our second half results and are updating our outlook for the balance of the year, we remain calm.

Efraim Grinberg: While we are pleased that we have improved our retail trends overall, we recognize that the global operating environment remains challenging for retail and the watch category in particular, with a heightened level of uncertainty. We believe this will have an impact on our second half results and are updating our outlook for the balance of the year. We remain confident in the initiatives that we have put in place to support our brands, as these investments are continuing to strengthen our position in the marketplace and should lead to market share growth in a difficult consumer spending backdrop. While the initiatives are beginning to deliver improving results, they are not at the level we had planned, impacted by the difficult macro environment.

Speaker Change: And the initiatives that we've put in place to support our brands as these investments are continuing to strengthen our position in the marketplace and should lead to market share growth in a difficult consumer spending backdrop, while the initiatives are beginning to deliver improving results. They are not at the level, we had planned impacted by the difficult macro environment.

Efraim Grinberg: As we look at the balance of the year, we will be focused on beginning to bring our operating expenses in line with sales while laying a solid foundation for continued support of our brand building efforts.

Speaker Change: As we look at the balance of the year, we will be focused on beginning to bring our operating expenses in line with sales while laying a solid foundation for continued support of our brand building efforts.

Efraim Grinberg: In our Movado brand, we are excited to launch our new Iconz advertising campaign that we announced yesterday in a separate press release. Movado has had a long association with iconic brand ambassadors from Kerry Washington to Derek Dieter and Pete Sampras. We are introducing five new ambassadors into a new advertising campaign entitled "When I Move You Move," featuring Ludicrous, Jessica Alba, Julianne Moore, Christopher McCaffrey, and Tyrese Halliburton. The ad campaign will also feature Ludicrous' iconic song "Stand Up." This will be the most comprehensive brand campaign that we have ever launched, and we will have a 360-degree media campaign throughout the holiday season, including the most important digital and social platforms, print magazines, billboards, and both digital and linear TV.

Speaker Change: And our Novato brand, we are excited to launch our new icons advertising campaign that we announced yesterday in a separate press release Novato has had a long association with iconic brand ambassadors from Kerry, Washington to Derek Jeter, and Pete Sampras, we're introducing five new ambassadors into new advertising Cam.

Speaker Change: Pain entitled When I move you move featuring Ludacris, Jessica Alba, Julianne Moore, Christian Mcafee and Tyrese Halliburton. The AD campaign will also feature Ludacris as iconic song stand up this will be the most comprehensive brand campaign that we've ever launched and we will have a 300.

Speaker Change: Third 60 degree media campaign throughout the holiday season, including the most important digital and social platforms print magazines Billboards in both digital and linear TV. We are very excited to see the results and are confident that we will continue to build on Nevada has strong brand equity and to introduce new <unk>.

Efraim Grinberg: We are very excited to see the results and are confident that we will continue to build on Movado's strong brand equity and to introduce new consumers to the Movado brand, both online and in store. The positive press coverage that we received online yesterday was the most that we have ever received, seven publications reaching a potential of over 245 million readers. In addition to our new campaign, we also have a number of exciting new products that we will introduce at retail, including line extensions in our very successful Bold Quest collection. This includes a smaller size of 35 millimeters, a new chronograph, and a beautiful new automatic version for the holidays.

Speaker Change: <unk> to the Nevado brand, both online and in store.

Speaker Change: The positive press coverage that we received online yesterday was the most that we have ever received seven publications, reaching a potential of over 245 million readers. In addition to our new campaign. We also have a number of exciting new products that we will introduce it.

Speaker Change: Dale including line extensions and a very successful bold Quest collection. This includes a smaller size of 35 millimeters, a new chronograph and a beautiful new automatic version for the holidays. We have seen strong success in our heritage collection, and we will be introducing a new kolenda plant as automatic assortment.

Efraim Grinberg: We have seen strong success in our heritage collection, and we will be introducing a new Collendo Plan S automatic assortment. With shaped watches performing well in the marketplace, we will be introducing our first tank collection in bold evolution, which has received a strong reception from our retailers. In addition to Movado improving its performance during the first half of the year in the United States, the brand is also seeing a strong response from consumers in India as we begin to grow that market. As we look at our licensed brand businesses, we continue to partner with some of the extraordinary brands like Coach, Tommy Hilfiger, Hugo Boss, Lacoste, and Calvin Klein.

Speaker Change: We've shaped watches performing well in the marketplace, we will be introducing our first tank collection and bold evolution, which has received a strong reception from our retailers. In addition to Nevada, improving its performance during the first half of the year in the United States. The brand is also seeing a strong response from consumers in India as.

Speaker Change: As we begin to grow that market.

As we look at our licensed brand business as we continue to partner with some of the some extraordinary brands like coach Tommy Hilfiger, Hugo Boss, Lacoste, and Calvin Klein, while the fashion fashion watch category has been challenging we were able to grow our business by two 5% for the quarter, we continue to.

Efraim Grinberg: While the fashion watch category has been challenging, we were able to grow our business by two and a half percent for the quarter. We continue to focus on developing and introducing iconic products in both watches and jewelry, and collaborating with our brand partners on our marketing efforts. Hugo Boss highlights for the coming second half of the year include continued support of the Sky Traveler and Cander families, and the introduction of our new BOSMATIC family. BOSMATIC is a diver-inspired family that features our hybrid automatic movement, powered by the motion of the wearer with the accuracy of a quartz watch.

Speaker Change: On developing and introducing iconic product in both watches and jewelry and collaborating with our brand partners on our marketing efforts.

Speaker Change: Hugo boss and Hugo boss highlights for the coming second half of the year include continued support of the Sky traveler and candor families and the introduction of our new boss somatic family boss Matic as a diver inspired family that features a high bred automatic movement powered by the motion of the where with the accuracy of our call.

Efraim Grinberg: BOSMATIC will feature a six-month power reserve. Our retailers are very excited about the BOSMATIC family, and it will be featured in a limited number of our retailers in every market. In Tommy Hilfiger, we will continue to support our iconic TH85 collection, and will introduce innovations such as our new chronograph. We will also be introducing new models to our growing Baker family.

Speaker Change: Swatch boss Maddock will feature six months power reserve our retailers are very excited about the <unk> family and it will be featured in a limited number of our retailers in every market.

Speaker Change: In Tommy Hilfiger, we will continue to support our iconic th 85 collection and will introduce innovation such as our new Chronograph, we'll also be introducing new models to our growing Baker family.

Speaker Change: <unk> cost brand continues to perform very well in both watches and jewelry.

Speaker Change: We are very excited to be introducing this fall the ILC 33 family of any <unk> sports watches available in multiple color ways. The IL 33 is featured on silicon strap and will be marketed with the tagline unleash your inner crocodile will be collaborating closely with our partners around the world with.

Sallie DeMarsilis: Sallie DeMarsilis, Michael Legg, Cody McAlester, Movado Group Inc. Sallie DeMarsilis is strong for the first half of the year. And we will continue with exciting launches as the year progresses. In our men's collection, we have introduced Charter, a fabulous automatic watch opening at $295 featuring coach, friend, ambassador, Jason Tatum in our marketing campaign. In line with the trend supporting shape cases, our customers are really excited by the introduction of our new oval family, Sammy. Finally, in CK, we will continue to place a greater emphasis on women's watches and jewelry with the introduction of the CK Pulse collection and the expansion of our iconic twisted bezel, which will now be available in a noble bangle version.

This significant launch.

Speaker Change: Our results for our coach brand had been strong for the first half of the year and we will continue with exciting launches as the year progresses, and our managed collection. We have introduced charter a fabulous automatic watch opening of $295 featuring coach brand Ambassador, Jason Tatum, and our marketing campaign.

Speaker Change: In line with the trends supporting shaped cases, our customers are really excited by the introduction of our new oval families Sammy.

Speaker Change: Finally, and CK, we will and we will continue to place a greater emphasis on women's and women's watches and jewelry with the introduction of the CK pulse collection and the expansion of our iconic twisted bezel, which will now be available in an oval bangle version.

Sallie DeMarsilis: During the second quarter, our outlet stores were on plan, with a decline in brick-and-mortar store sales offset by growth in our digital and our digital business. During the second half of the year, we expect that the additional marketing behind the Movado brand will benefit our direct-to-consumer channels, including our outlet store channel, particularly in the fourth quarter. Overall, while we recognize it will take time to achieve our desired results, we are making progress and are confident in our strategic plan, including growing unit volumes and improving sales trends in certain of our retail channels. We are adjusting to the consumer landscape, bringing our expenses more in line to begin to improve our financial metrics, while continuing to support our brands and our customers.

Speaker Change: During the second quarter, our outlet stores were on plan with a decline in brick and mortar store sales offset by growth in our digital and our digital business. During the second half of the year, we expect that the additional marketing behind them Novato brand will benefit our direct to consumer channels, including our outlet store channel, particularly in the fourth quarter.

Speaker Change: Yeah.

Speaker Change: Overall, while we while we recognize it will take time to achieve our desired results. We are making progress and are confident in our strategic plan, including growing unit volumes and improving sales trends in certain of our retail channels. We are adjusting to the consumer landscape, bringing our expenses more in line to begin to improve our financial.

Speaker Change: Metrics, while continuing to support our brands and our customers. We believe that the increased spending in our brand building efforts will enable us to jumpstart, our novato brand and ensure that our fashion business is positioned to deliver accelerated growth as the market improves. This year has been an investment year and as we begin to plan for.

Sallie DeMarsilis: We believe that the increased spending in our brand building efforts will enable us to jumpstart our Movado brand and ensure that our fashion business is positioned to deliver accelerated growth as the market improves.

Sallie DeMarsilis: This year has been an investment year, and as we begin to plan for next year, we will ensure that our expenses are in line with anticipated sales, allowing us to return to profitable, sustainable growth.

Speaker Change: Next year, we will ensure that our expenses are in line with anticipated SaaS, allowing us to return to profitable sustainable growth I would now like to turn the call over to Sally.

Sallie DeMarsilis: I would now like to turn the call over to Sally. Thank you, Ephraim. Good morning, everyone.

Sally: Thank you <unk> and good morning, everyone for today's call I will review our financial results for the second player and year to date period of fiscal 2025, and then I will provide an update on our outlook for the year.

Sallie DeMarsilis: For today's call, I will review our financial results for the second quarter in the year-to-date period of fiscal 2025, and then I will provide an update on our outlook for the year. Net sales in the second quarter improved sequentially from the first quarter as our marketing and product initiatives gained traction. Overall, our top-line performance was slightly below the second quarter of fiscal 2024, with net sales being down 0.7%, and profitability impacted by our increased marketing investment. While we continue to operate in a dynamic global environment, we are pleased with the progress we are making on our initiatives and believe that our efforts have positioned us well for the future.

Sally: Net sales in the second quarter improved sequentially from the first quarter as our marketing and product initiatives gained traction.

Sally: For all our topline performance was slightly below the second quarter of fiscal 2024, with net sales being down 7% and profitability impacted by our increased marketing investment.

Sally: While we continue to operate in a dynamic global environment. We are pleased with the progress we are making on our initiatives and believe that our efforts have positioned us well for the future.

Sallie DeMarsilis: Turning to review of the quarter, sales were 159.3 million dollars, as compared to 160.4 million dollars last year, a decrease of 0.7%. In constant dollars, the decrease in net sales was 0.3 percent. Net sales decreased across own brands and company stores, partially offset by an increase in net sales and license brand. By geography, US net sales decreased 0.3 percent as compared to the second quarter of last year. International net sales decreased 0.9 percent. On a constant currency basis, international net sales decreased 0.3 percent. First profit as a percent of sales was 54.2 percent compared to 55.7 percent in the second quarter of last year.

Speaker Change: Turning to a review of the acquirer.

Speaker Change: Sales were $159 $3 million as compared to $164 million last year, a decrease of <unk>, 7%.

Speaker Change: In constant dollars and decrease in net sales was 3%.

Speaker Change: Net sales decreased across owned brands and company stores, partially offset by an increase in net sales and licensed brands.

Speaker Change: By geography U S net sales decreased 3% as compared to the second quarter of last year International net sales decreased 9% on a constant currency basis International net sales decreased 3%.

Speaker Change: Gross profit as a percent of sales was 54, 2% compared to 55, 7% in the second quarter of last year. The decrease in gross margin rate as compared to the same period of last year was primarily driven by unfavorable channel and product mix.

Sallie DeMarsilis: The decrease in Ghost Martin Raid as compared to the same period of last year was primarily driven by a favorable channel in product mix. Operating expenses were $83.3 million as compared to $79.6 million for the same period of last year. The increase was driven by an increase in investment in marketing, partially offset by a decrease in performance-based compensation. Operating income decreased to $3 million as compared to $9.6 million in the second quarter of fiscal 2024. We recorded approximately $1.8 million of other non-operating income in the second quarter of fiscal 2025, which is primarily comprised of interest earned on our global cash position.

Speaker Change: Operating expenses were $83 $3 million as compared to $79 $6 million at the same period of last year the.

Speaker Change: The increase was driven by an increased investment in marketing, partially offset by a decrease in performance based compensation.

Speaker Change: Operating income decreased to $3 million as compared to $9 $6 million in the second quarter of fiscal 2024.

Speaker Change: We recorded approximately $1 $8 million of other non operating income in the second quarter of fiscal 2025, which is primarily comprised of interest earned on our global cash position.

Sallie DeMarsilis: We recorded income tax expense of $900,000 in the second quarter of fiscal 2025 as compared to $2.9 million in the second quarter of fiscal 2024. Net income in the second quarter was $3.7 million, or $0.16 for diluted share, as compared to $8 million, or $0.36 for diluted share, in the year-ago period.

Speaker Change: We recorded income tax expense of $900000 in the second quarter of fiscal 2025, as compared to $2 $9 million in the second quarter of fiscal 2024.

Speaker Change: Net income in the second quarter was $3 7 million or 16 per diluted share as compared to $8 million or <unk> 36 cents per diluted share in the year ago period.

Sallie DeMarsilis: Now turning to our year-to-date results. Sales for the six-month period ended July 31, 2024, for $296 million as compared to $305.3 million last year. Total net sales decreased 3.1% as compared to the six-month period of fiscal 2024. International sales decreased 3.1%, and U.S. Net sales declined by 3%. First profit was $161.9 million, or 54.7%, as compared to $171.3 million, or 56.1%, in the sales last year. The decreasing gross margin rate for the first six months was primarily due to unfavorable channel and product mix, and the delivery of higher fixed cost over lower sales. This was partially offset by decrease shipping costs.

Speaker Change: Now turning to our year to date results sales for the six months period ended July 31, 2024 for $296 million as compared to $305 $3 million last year.

Speaker Change: Total net sales decreased three 1% as compared to the six month period of fiscal 2024 International sales decreased three 1% in U S. Net sales declined by 3%.

Speaker Change: Gross profit was $161 9 million or 54, 7% of sales as compared to $171 $3 million or 56, 1% of sales last year.

Speaker Change: Decrease in gross margin rate for the first six months was primarily due to unfavorable channel and product mix and the deleverage with higher fixed costs over a lower sales.

Speaker Change: Partially offset by decreased shipping costs.

Sallie DeMarsilis: Operating expenses were $155.5 million as compared to $150.7 million for the same period of last year. The increase was driven by an increased investment in marketing and higher payroll-related costs. Partially offset by a decrease in performance-based compensation. For the six-month end of July 31, 2024, operating income was $6.3 million compared to $20.5 million in fiscal 2024. We recorded approximately $3.8 million of other non-operating income in the six-month period of fiscal 2025, which is primarily comprised of interest earned on our global cash position. Net income was $6.6 million or $0.29 cents per diluted share as compared to $17.2 million or $0.76 cents per diluted share in the year of a period.

Speaker Change: Operating expenses were $155 $5 million as compared to $150 $7 million for the same period of last year. The increase was driven by.

Speaker Change: By an increased investment in marketing and higher payroll related costs, partially offset by a decrease in performance based compensation.

Speaker Change: For the six months ended July 31, 2024 operating income was $6 3 million.

Speaker Change: Paired to $20 $5 million in fiscal 2024.

Speaker Change: We reported approximately $3 $8 million of other non operating income in the six months period of fiscal 2025, which is primarily comprised of interest earned on our global cash position.

Speaker Change: Net income was $6 6 million or 29 cents per diluted share as compared to $17 2 million or 76 cents per diluted share in the year ago period.

Sallie DeMarsilis: Now turning to our balance sheet. Cash at the end of the second quarter was $198.3 million as compared to $218.9 million at the same period last year. Accounts affordable was $109.8 million, up $14 million from the same period of last year, primarily due to timing and mix of business. Inventory at the end of the quarter was down $5.1 million, or 2.8% below the same period of last year. We are comfortable with the composition and balance of our inventory at quarter end. In the first six months of fiscal 2025, capital expenditures were $3.9 million and were repurchased approximately 39,000 shares under our Sherry Purchase Program.

Speaker Change: Now turning to our balance sheet.

Speaker Change: Cash at the end of the second quarter was $198 $3 million as compared to $218 $9 million at the same period last year.

Accounts receivable was $198 million up $14 million from the same period of last year, primarily due to timing and mix of business.

Speaker Change: Inventory at the end of the quarter was down $5 1 million or two 8% below the same period of last year, we are comfortable with the composition and balance of our inventory at quarter end.

Speaker Change: And the first six months of fiscal 2025 capital expenditures were $3 $9 million and we repurchased approximately 39000 shares under our share repurchase program.

Sallie DeMarsilis: As of July 31, 2024, we had $16.8 million remaining under our authorized Sherry Purchase Program, subject to prevailing market conditions and the business environment, and plan to utilize our Sherry Purchase Plan to offset delusions in fiscal 2025.

Speaker Change: As of July 31, 2024, we had $16 $8 million remaining under our authorized share repurchase program.

Speaker Change: Subject to prevailing market conditions, and the business environment, we plan to utilize our share repurchase plan to offset dilution in fiscal 2025.

Sallie DeMarsilis: Now I would like to discuss our updated outlook for the balance of the year. As Efraim mentioned, we are operating in a consumer environment that is challenging for retail and the watch category, and our larger customers are maintaining lower levels of inventory. Net sales are currently expected to be in a range of $665 to $675 million, with our second half sales expected to be flat to up low single digits as compared to last year. An improvement from the first half declined of 3.1%. We expect growth profit of approximately 54% of sales for the year and operating income in a range of $23 to $26 million.

Speaker Change: Now I would like to discuss our updated outlook for the balance of the year.

Speaker Change: As Evan mentioned, we are operating in a consumer environment that is challenging for retail and the watch category and our larger customers are maintaining lower levels of inventory.

Net sales are currently expected to be in the range of $665 million to $675 million with our second half sales expected to be flat to up low single digits as compared to last year.

Speaker Change: An improvement from the first half decline of three 1%.

Speaker Change: We expect gross profit of approximately 54% of sales for the year and operating income in a range of $23 million to $26 million.

Sallie DeMarsilis: This expectation for operating income includes beginning to bring our expenses to be more in line with our sales and to improve our financial metrics while continuing to support our brands and our customers. Based on our global footprint and our estimated jurisdictional taxable income, we now expect our effective tax rate to be 25% with an expected range of earnings of $0.90 to $1 per diluted share. As we look towards next fiscal year, we are committed to improving our financial performance.

Speaker Change: Its expectation for operating income include beginning to bring our expenses to be more in line with ourselves and to improve our financial metrics, while continuing to support our brands and our customers.

Speaker Change: Based on our global footprint and our estimated jurisdictional taxable income we now expect.

Speaker Change: Our effective tax rate to be 25% with an expected range of earnings of 90 to $1 per diluted share.

Speaker Change: As we look towards next fiscal year, we are committed to improving our performance our financial performance.

Unknown Attendee: I would now like to open a call-up for questions. Thank you. If you would like to ask a question, please press star one on your telephone keypad. A confirmation telephone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For a participant choosing speaker equipment, it may be necessary to pick up your handset before pressing the star keys.

Speaker Change: I would now like to open the call up for questions.

Thank you if he would like to ask a question. Please press star one on your telephone keypad, a confirmation tone will indicate your line is in the question queue. You May press star two if he would like to remove your question from the queue for participants using speaker equipment. It may be necessary to pick up your handset before pressing the star.

Michael Legg: Our first question is from Michael Legg with the Benchmark Company.

Speaker Change: He is.

Speaker Change: Our first question is from Michael Legg with Benchmark Company. Please proceed.

Michael Legg: Please proceed. Thanks.

Efraim Grinberg: Good morning. You mentioned coming out of this period with increased market share growth. Can you talk about what you're seeing from the competition today from a pricing perspective, from a viability perspective, and anything from a geographic perspective also? Thanks. Sure. What we're seeing is the watch category overall, from luxury down to accessible, has become challenging. What occurred initially, probably in the fashion watch category, has now spread a little bit to the luxury category as well, and you're seeing those numbers particularly come out of Switzerland. I think what we're also seeing is that we have executed pretty well in the fashion watch category, and so we've seen gains there, while other of our competitors within the fashion watch category are challenged.

Michael Legg: Thanks, Good morning.

Sure.

Michael Legg: You mentioned coming out of this period with increased market share market share growth can you talk what you're seeing from the competition today from a pricing perspective.

Speaker Change: From a liability perspective.

Speaker Change: Anything from a geographic perspective also thanks.

Speaker Change: Sure.

Speaker Change: So I think I think what we're seeing is the is the watch category overall from luxury.

Down to SaaS the ball has <unk> has become <unk>.

Speaker Change: <unk>.

Speaker Change: Occurred initially probably in the fashion watch category is now.

Speaker Change: So had a little bit to the luxury category as well and youre seeing those numbers, particularly come out come out of.

Speaker Change: Switzerland.

Speaker Change: I think what we're also seeing is that the that we have executed pretty well in the in the fashion watch category and and so we've seen gains there while other of our competitors within the fashion watch category are challenged.

Efraim Grinberg: But as we all know, European markets are challenged. The US economy and employment is beginning to show some signs of stress. So there are a number of different factors involved, and then we've seen good growth in markets like Latin America, Mexico, and India, developing markets where, as you read, the economic numbers have improved. And I think our strategies have worked. They've just not worked to the extent that we would have liked them to. We're really excited about the Mavado campaign that we launched yesterday, the positive reviews and coverage. I urge all of you to go on our website or to look up some of the articles that have been written about our ad campaign.

Speaker Change: But as we all know European markets are challenged the U S economy unemployment.

Speaker Change: As be getting to show some signs of <unk>.

Speaker Change: Stress.

Speaker Change: So there are a number of different factors involved.

Speaker Change: Involved in.

Speaker Change: And then we've seen good growth in markets like Latin America, Mexico.

Speaker Change: India developing markets where.

Speaker Change: As you read the economic.

Speaker Change: Numbers have had an improvement.

Speaker Change: Improved and.

Speaker Change: And I think our strategies have worked they are just not work to the extent.

Speaker Change: That we would have liked them to.

Speaker Change: We're really excited about them Novato campaign that we launched yesterday, the the positive reviews and coverage I urge all of you to go on our website or or to look up.

Speaker Change: Look up some of the articles that have been written about our AD campaign has gotten very very strong reviews, and we're really excited about the prospects that debt.

Efraim Grinberg: It's gotten very, very strong reviews, and we're really excited about the prospects that this campaign will yield for the Mavado brand. Overall.

Speaker Change: <unk>.

Speaker Change: This campaign will will yield for the Nevado brand overall.

Efraim Grinberg: Great. And then just on if you mentioned the media campaign in India there, can you talk about I assume that the media campaign is global just coming on that and then second on the India opportunity. Can you expand a little bit on the opportunity there? Sure. So, and the Movado campaign is predominantly in North America. We will run the campaign in India, as well as some of it will spread to China and other markets. But Movado is for us about 90% domestic, and although I do believe that this campaign will present international opportunities in the future, as well as our product, the assortment, and innovation.

Speaker Change: Okay, Great and then just on the you mentioned the media campaign in India. There can you talk about.

Speaker Change: I assume that the media campaign is global just comment on that and then second on the India opportunity can you just expand a little bit on the opportunity there.

Speaker Change: Sure so so.

Speaker Change: The Novato campaign is predominantly in North America, we will run the campaign in India, as well and some of it will spread to China.

In other markets, but novato is for us about.

Speaker Change: 90%.

Speaker Change: Domestic.

Speaker Change: And although I do believe that this campaign will present, an international opportunities.

Speaker Change: In the future as well as our our product assortment and innovation.

Efraim Grinberg: So, that campaign is mostly based in the United States, and we'll run throughout the fall, really launching this month on digital platforms as well as outdoor. And then we'll add in TV and other media into the important holiday season.

Speaker Change: So so that campaign is mostly based in the United States.

Speaker Change: And we will run throughout the fall.

Speaker Change: Really launching.

Speaker Change: This month on digital platforms as well as.

Speaker Change: As our.

Al Dor: Al Dor.

Al Dor: And then we'll we'll add in TV and other our other media.

Al Dor: Into the important holiday season.

Unknown Attendee: Great.

Speaker Change: Okay, Great and then just enjoy I didn't hear anything on jewelry is that something kind of taking a backseat until the consumer with tourists or warehouse jewelry doing now jewelry is actually outperforming watches in our fashion and our fashion brands.

Efraim Grinberg: And then just on jewelry, I didn't hear anything on jewelry. Is that something kind of taking a vaccine to the consumer returns or what? How's jewelry doing? The jewelry is actually outperforming watches in our fashion, in our fashion brands, and seems to be doing very well. Our innovation has been good, and we think that that still continues to present a big opportunity for the companies as we grow that business, particularly strong in markets like Europe and Mexico and markets like that. So, so we're excited about that opportunity. And then we will reset our Movado jewelry assortment beginning next year that we're really excited about as well.

Speaker Change: And and seems to be doing very well our innovation.

Speaker Change: Has been good.

Speaker Change: And.

Speaker Change: And we think that that still continues to present.

Speaker Change: Big opportunity for the company as we grow that business, particularly strong in markets like Europe and.

Speaker Change: And Mexico in markets like that so we're excited about that opportunity.

Speaker Change: And then we will reset our novato jewelry assortment beginning next year that we're really excited about as well.

Efraim Grinberg: And then a couple of financials on the guidance. I assume that does not factor any interest rate cuts into it is more of a steady state with the consumers give us all anything in service to that. I mean, I think I think you know that the personal opinion is that the interest rates increases and have occurred over a several year period that I would imagine that the declines will happen in a similar fashion unless things get economically the numbers get significantly worse. And I don't think that has an immediate impact on consumers; that takes a little longer to have an impact on consumers, just as rate hikes do.

Speaker Change: Okay, and then a couple of financials.

Speaker Change: On the guidance I assume that does not factor any interest rate cuts into it. It's just more of a steady state with the consumer can you just give us a lot.

Speaker Change: And so you can see that.

Speaker Change: I think I think.

Speaker Change: Yeah.

Speaker Change: My personal opinion is that the interest rates.

Speaker Change: <unk> increases and have occurred over.

Speaker Change: A several year period.

Speaker Change: Imagine that the declines will happen in a similar fashion unless things get.

Speaker Change: Economically the numbers get a significantly.

Speaker Change: Worse and I don't think that has an immediate impact.

Speaker Change: Im consumers and that takes a little longer to have an impact on consumers just as rate hikes do.

Efraim Grinberg: So, I think that there will certainly be a benefit as rates begin to come down, but it doesn't happen. immediately, from a retail perspective.

So I think that there will certainly be a benefit as rates begin to come down but it doesn't happen immediately.

Speaker Change: From a retail perspective.

Efraim Grinberg: And then just last question, you're stocked by back here, 16.8 million left. You use it to offset any delusion from issued shares. What was it take for you to be more aggressive in the share buy back at what level of stock? I don't really think it's about a level. I think it's about a level of confidence in the environment versus just our own execution and performance. And quite frankly, I think we have to; we will, I know, do a better job on executing and managing our investments as we begin to look at next year. We're not, you know, we have no need to, we will curtail thumb this fall, but we are not touching our Mavado campaign. Believe that strongly in the importance of that and the benefit to the brand.

Speaker Change: And then just last question your stock buyback at $16 8 million left do you use it to offset any.

Speaker Change: Dilution from issued shares.

Speaker Change: Does it take for you to.

Speaker Change: Be more aggressive in the share buyback at what level of stock.

Speaker Change: I don't I don't really think it's about a level I think it's about a level of confidence in the environment versus just our own execution.

Speaker Change: Performance and quite frankly, I think we have to we will do a better job.

Speaker Change: On executing and managing R. R.

Speaker Change: Our investments as we as we begin to look at next year, we're not.

Speaker Change: We have no need to we will curtail some this fall, but we are not touching our novato campaign believe that strongly in the importance of that and the benefit.

Efraim Grinberg: So we saw opportunities to invest in our business, but obviously the value of the shares, we believe, represents a good value. So we will certainly look at that as the year progresses. And as we see the market begin to evolve.

Speaker Change: To the brands so we stopped.

Opportunities to invest in our business, but obviously the value of the shares.

Speaker Change: We believe.

Speaker Change: <unk> represent a good value so.

Speaker Change: We will certainly look at that as the year progresses.

Speaker Change: And as we see the the.

Speaker Change: The market begin to.

Speaker Change: To evolve.

Unknown Attendee: Thank you.

Speaker Change: Okay. Thank you.

Unknown Attendee: We have reached the end of our question-and-answer session.

Greenberg: We have reached the end of our question and answer session I would like to turn the conference back over to a firm Greenberg for closing remarks.

Efraim Grinberg: I would like to turn the conference back over to F-Rome Greenberg for closing remarks. Thank you all for joining us today. And as I said, we look forward to improving our operating performance as we begin to look into next year. And I encourage all of you to please visit the Mavado.com website, and you will get to really see what we've done. It's the first time that we've completely integrated campaign at the level that we've done it here. And as I said, it's gotten really, really positive reviews from marketing media, as well as a number of different editorials in the marketplace.

Thank you all for joining us today and as I said, we look forward to improving our operating performance.

Speaker Change: As we begin to look into into next year and I encourage all of you to please.

Greenberg: Please visit the novato.

Greenberg: Dot Com website and you will.

Greenberg: Get to.

Greenberg: See what we've done is the first time that we've completely integrated campaign at the level that we've done it here and as I said, it's gotten.

Greenberg: Really really positive review from.

Speaker Change: From a marketing media.

Speaker Change: Well as a number of different.

Speaker Change: At <unk> in the marketplace.

Unknown Attendee: Thank you again for joining us today. Thank you.

Speaker Change: Thank you again for joining us today.

Speaker Change: Thank you. This will conclude today's conference you may disconnect at this time and thank you for your participation.

Unknown Attendee: This will conclude today's conference. You may disconnect up this time, and thank you for your participation. Thank you.

Speaker Change: Yeah.

Speaker Change: [music].

Unknown Attendee: Good morning everyone.

Unknown Attendee: With me on the call is Efraim Grinberg, Chairman and Chief Executive Officer and Sallie DeMarsilis, Executive Vice President and Chief Operating Officer and Chief Financial Officer. Before we get started, I would like to remind you of the company's safe harbor language, which I'm sure you're all familiar with. The statements contained in this conference call, which are not historical facts, maybe deemed to constitute for looking statements within the meeting of the private securities litigation reformat.

Speaker Change: Okay.

Speaker Change: Mhm.

Speaker Change: [music].

Speaker Change: Hum.

Speaker Change: Okay.

Speaker Change: [music].

Speaker Change: Okay.

Speaker Change: Uh-huh.

Unknown Attendee: Actual future results may differ materially from those suggested in such statements due to a number of risks and uncertainties, all of which are described in the company's filings with the SEC, which includes today's press release. If any non-gap financial measure is used on this call, a presentation of the most directly comparable gap financial measure to this non-gap financial measure will be provided as supplemental financial measures. Financial information in our press release.

Speaker Change: Mhm.

Speaker Change: Uh huh.

[music].

Speaker Change: Okay.

Speaker Change: Yeah.

Efraim Grinberg: Now I would like to turn the call over to Efraim Grinberg, Chairman and Chief Executive Officer of Movado Group. Thank you, Alison. Good morning and thank you for joining us today. I am pleased to share our second quarter of performance as we make progress advancing our strategy and a challenging consumer spending environment. We improved our sales trends from the first to the second quarter, reporting virtually flat net sales on a constant dollar basis to last year.

Speaker Change: Okay.

Okay.

Speaker Change: [music].

Efraim Grinberg: Our operating profit declined to $3 million driven by increased marketing investments that are expected to accelerate sales growth in the future. We maintained a healthy growth margin with the rate declining versus the second quarter last year due to the overall mix of our business. Our balance sheet remains strong with $198 million in cash and no debt. Inventory increase from the beginning of the fiscal year to support our sales expectations for the second half of the year.

Efraim Grinberg: Across geographies, our retail partners placed orders cautiously, especially in Europe and the US, where customers are maintaining lower levels of inventory and a challenging consumer spending environment. Despite this, we were pleased to see a favorable response to our increased marketing investment. We saw increased increased interest across our brands with unit volume in our license brands, increasing by 10 percent, buoyed by our marketing efforts and the reintroduction of certain price points that we had previously vacated across our brands.

Efraim Grinberg: In our Mavado brand, sales grew by 1.4 percent with growth in the direct to consumer channel, including a 21 percent increase in Mavado.com, mostly offset by a 6 percent decline in our wholesale channel. While we are pleased that we have improved our retail trends overall, we recognize that the global operating environment remains challenging for retail and the watch category in particular. With a heightened level of uncertainty, and we believe this will have an impact on our second half results and are updating our outlook for the balance of the year, we remain confident in the initiatives that we have put in place to support our brands as these investments are continuing to strengthen our position in the marketplace and should lead to market share growth in a difficult consumer spending backdrop.

Efraim Grinberg: While the initiatives are beginning to deliver improving results, they are not at the level we had planned, impacted by the difficult macro environment. As we look at the balance of the year, we will be focused on beginning to bring our operating expenses in line with sales while laying a solid foundation for continued support of our brand building efforts.

Efraim Grinberg: In our Movado brand, we are excited to launch our new Iconz Advertising campaign that we announced yesterday in a separate press release. Movado has had a long association with iconic brand ambassadors, from Kerry Washington to Derek Dieter and Pete Samperes. We are introducing five new ambassadors into a new advertising campaign entitled When I Move You Move, featuring ludicrous Jessica Alba, Julianne Moore, Christopher McCaffrey, and Tyrese Halliburton. The ad campaign will also feature ludicrous's iconic song Stand Up.

Efraim Grinberg: This will be the most comprehensive brand campaign that we have ever launched. And we will have a 360 degree media campaign throughout the holiday season, including the most important digital and social platforms, print magazines, billboards, and both digital and linear TV. We are very excited to see the results, and are confident that we will continue to build on Movado's strong brand equity and introduce new consumers to the Movado brand, both online and in store.

Efraim Grinberg: The positive press coverage that we received online yesterday was the most that we have ever received, seven publications reaching a potential of over 245 million readers. In addition to our new campaign, we also have a number of exciting new products that we will introduce at retail, including line extensions in our very successful bold quest collection. This includes a smaller size of 35 millimeters, a new chronograph, and a beautiful new automatic version for the holidays.

Efraim Grinberg: As we look at our licensed brand businesses, we continue to partner with some of the extraordinary brands like Coach, Tommy Hilfiger, Hugo Boss, LaCost, and Calvin Klein. While the fashion watch category has been challenging, we were able to grow our business by two and a half percent for the quarter. We continue to focus on developing and introducing iconic product in both watches and jewelry, and collaborating with our brand partners on our marketing efforts.

Efraim Grinberg: Hugo Boss highlights for the coming second half of the year include continued support of the Sky Traveler and Cander families and the introduction of our new Boss Matic family. Boss Matic is a diver inspired family that features our hybrid automatic movement powered by the motion of the wearer with the accuracy of a quartz watch. Boss Matic will feature a six month power reserve. Our retailers are very excited about the Boss Matic family, and it will be featured in a limited number of our retailers in every market. In Tommy Hilfiger, we will continue to support our iconic TH85 collection and will introduce innovation such as our new chronograph.

Efraim Grinberg: We will also be introducing new models to our growing Baker family.

Efraim Grinberg: Sallie DeMarsilis, Michael Legg, Cody McAlester, Movado Group Inc We will be collaborating closely with our partners around the world with this significant launch. Our results for our coach friend have been strong for the first half of the year, and we will continue with exciting launches as the year progresses. In our men's collection, we have introduced Charter, a fabulous automatic watch opening at $295 featuring coach friend Ambassador Jason Tatum in our marketing campaign.

Efraim Grinberg: In line with the trend supporting shape cases, our customers are really excited by the introduction of our new oval family, Sammy. Finally, in CK, we will continue to place a greater emphasis on women's watches and jewelry with the introduction of the CK pulse collection and the expansion of our iconic twisted bezel which will now be available in a noble bangle version. During the second quarter, our outlet stores were on plan, with a decline in brick-and-mortar store sales offset by growth in our digital business.

Efraim Grinberg: During the second half of the year, we expect that the additional marketing behind the Movado brand will benefit our direct-to-consumer channels, including our outlet store channel, particularly in the fourth quarter. Overall, while we recognize it will take time to achieve our desired results, we are making progress and are confident in our strategic plan, including growing unit volumes and improving sales trends in certain of our retail channels. We are adjusting to the consumer landscape, bringing our expenses more in line to begin to improve our financial metrics while continuing to support our brands and our customers. We believe that the increased spending in our brand-building efforts will enable us to jumpstart a Movado brand and ensure that our fashion business is positioned to deliver accelerated growth as the market improves.

Efraim Grinberg: This year has been an investment year, and as we begin to plan for next year, we will ensure that our expenses are in line with anticipated sales, allowing us to return to profitable sustainable growth.

Sallie DeMarsilis: I would now like to turn the call over to Sally. Thank you, Efram.

Sallie DeMarsilis: Good morning, everyone. For today's call, I will review our financial results for the second quarter in the year-to-date period of fiscal 2025, and then I will provide an update on our outlook for the year. Net sales in the second quarter improved sequentially from the first quarter, as our marketing and product initiatives gained traction. Overall, our top-line performance was slightly below the second quarter of fiscal 2024, with net sales being down 0.7%, and profitability impacted by our increased marketing investment.

Sallie DeMarsilis: While we continue to operate in a dynamic global environment, we are pleased with the progress we are making on our initiatives, and believe that our efforts have positioned us well for the future. Turning to review of the quarter, sales were $159.3 million, as compared to $160.4 million last year. A decrease of 0.7% In constant dollars, the decrease in net sales was 0.3 percent. Net sales decreased across own brands and company stores, partially offset by an increase in net sales and license brand.

Sallie DeMarsilis: By geography, US net sales decreased 0.3 percent as compared to the second quarter of last year. International net sales decreased 0.9 percent. On a constant currency basis, international net sales decreased 0.3 percent. First profit as a percent of sales was 54.2 percent compared to 55.7 percent in the second quarter of last year. The decrease in Ghost Martin Raid as compared to the same period of last year was primarily driven by a favorable channel in product mix.

Sallie DeMarsilis: Operating expenses were $83.3 million as compared to $79.6 million for the same period of last year. The increase was driven by an increase investment in marketing, partially offset by a decrease in performance-based compensation. Operating income decreased to $3 million as compared to $9.6 million in the second quarter of fiscal 2024. We recorded approximately $1.8 million of other non-operating income in the second quarter of fiscal 2025, which is primarily comprised of interest earned on our global cash position.

Sallie DeMarsilis: We recorded income tax expense of $900,000 in the second quarter of fiscal 2025 as compared to $2.9 million in the second quarter of fiscal 2024. Net income in the second quarter was $3.7 million or $16 cents for diluted share as compared to $8 million or $36 cents for diluted share in the year ago period.

Sallie DeMarsilis: Now turning to our year-to-date results. Failed for the six-month period ended July 31, 2024 for $296 million as compared to $305.3 million last year. Total net sales decreased 3.1 percent as compared to the six-month period of fiscal 2024. International sales decreased 3.1 percent and U.S, net sales declined by 3 percent. Gross profit was $161.9 million or $54.7 percent as sales as compared to $171.3 million or $56.1 percent as sales last year.

Sallie DeMarsilis: The decreasing gross margin rate for the first six months was primarily due to unfavorable channel and product mix and the delivery of higher fixed cost over lower sales. This was partially offset by decreased shipping costs. Operating expenses were $155.5 million as compared to $150.7 million for the same period of last year. The increase was driven by an increased investment in marketing and higher payroll-related costs partially offset by a decrease in performance-based compensation.

Sallie DeMarsilis: For the six-month end of July 31, 2024 operating income was $6.3 million compared to $20.5 million in fiscal 2024. We recorded approximately $3.8 million of other non-operating income in the six-month period of fiscal 2025, which is primarily comprised of interest earned on our global cash position. Net income was $6.6 million or $29 cents per diluted share as compared to $17.2 million or $76 cents per diluted share in the Now turning to our balance sheet, cash at the end of the second quarter was $198.3 million as compared to $218.9 million at the same period last year.

Sallie DeMarsilis: Accounts available was $109.8 million up $14 million from the same period of last year, primarily due to timing and mix of business. Inventory at the end of the quarter was down $5.1 million or 2.8% below the same period of last year. We are comfortable with the composition and balance of our inventory at quarter end. In the first six months of fiscal 2025, capital expenditures were $3.9 million and were repurchased approximately 39,000 shares under our sharey purchase program.

Sallie DeMarsilis: As of July 31, 2024, we had $16.8 million remaining under our authorized sharey purchase program. Subject to prevailing market conditions and the business environment and plan to utilize our sharey purchase plans to offset delusions in fiscal 2025.

Sallie DeMarsilis: Now I would like to discuss our updated outlook for the balance of the year. As Efra mentioned, we are operating in a consumer environment that is challenging for retail and the watch category and our larger customers are maintaining lower levels of inventory. Net sales are currently expected to be in a range of $665 to $675 million with our second half sales expected to be flat to up low single digits as compared to last year.

Sallie DeMarsilis: An improvement from the first half decline of 3.1%. We expect both profit of approximately 54% of sales for the year and operating income in a range of $23 to $26 million. This expectation for operating income includes beginning to bring our expenses to be more in line with our sales and to improve our financial metrics while continuing to support our brands and our customers. Based on our global footprint and our estimated jurisdictional taxable income, we now expect our effective tax rate to be 25% with an expected range of earnings of 90 cents to $1 per deluded share. As we look towards next fiscal year, we are committed to improving our financial performance.

Unknown Attendee: For a participant choosing speaker equipment, it may be necessary to pick up your handset before pressing the star keys.

Michael Legg: Our first question is from Michael Legg with the benchmark company. Please proceed. Thanks.

Efraim Grinberg: Good morning. You mentioned coming out of this period with increased market share growth. Can you talk what you're seeing from the competition today from a pricing perspective, from a viability perspective and anything from a geographic perspective also? Thanks. Sure. I think what we're seeing is the watch category. Overall, from luxury down to accessible has become challenging what occurred initially, probably in the fashion watch category, has now spread a little bit to the luxury category as well.

Efraim Grinberg: And you're seeing those numbers particularly come out of Switzerland. I think what we're also seeing is that we have executed pretty well in the fashion watch category. And so we've seen gains there while other of our competitors within the fashion watch category are challenged. But as we all know, European markets are challenged. The US economy and employment is beginning to show some signs of stress. So there are a number of different factors involved.

Efraim Grinberg: And then we've seen good growth in markets like Latin America, Mexico, India developing markets where, as you read, the economic numbers have improved. And I think our strategies have worked. They've just not worked to the extent that we would have liked them to. We're really excited about the Mavado campaign that we launched yesterday, the positive reviews and coverage. I urge all of you to go on our website or to look up some of the articles that have been written about our ad campaign. It's gotten very, very strong reviews. And we're really excited about the prospects that this campaign will yield for the Mavado brand. Overall.

Efraim Grinberg: Great. And then just on if you mentioned the media campaign in India there, can you talk about? I assume that the media campaign is global just coming on that and then second on the India opportunity. Can you expand a little bit on the opportunity there? Sure. So, and the Movado campaign is predominantly in North America. We will run the campaign in India as well as some of it will spread to China and other markets, but Movado is for us about 90% domestic and although I do believe that this campaign will present international opportunities in the future as well as our product, the assortment and innovation.

Efraim Grinberg: So, that campaign is mostly based in the United States and will run throughout the fall, really launching this month on digital platforms as well as outdoor. And then we'll add in TV and other media into the important holiday season.

Efraim Grinberg: Great. And then just enjoy it in here and enjoy. Is that something kind of taking it back to the consumer returns or what else do you really do? The jewelry is actually outperforming watches in our fashion in our fashion brands and and seems to be doing very well. Our innovation has been good and and we think that that still continues to present a big opportunity for the company as we grow that business particularly strong and in markets like Europe and and Mexico and and markets like that.

Efraim Grinberg: So, so we're excited about that opportunity and then we will reset our Movado jewelry assortment beginning next year that we're really excited about as well. And then a couple of financials on the guidance, I assume that does not factor any interest rate cuts into it which is more of a steady state with the consumer. Can you give us all anything in silence to that? I mean, I think I think you know that the personal opinion is that the interest rates increases and have occurred over a several year period.

Efraim Grinberg: I would imagine that the declines will happen in a similar fashion unless things get economically the numbers get significantly worse. And I don't think that has an immediate impact on on consumers that takes a little longer to have an impact on consumers just as rate hikes do. So, I think that there will certainly be a benefit as rates begin to come down, but it doesn't happen, immediately from a retail perspective. And then just last question, you're stocked by back here, 16.8 million left.

Efraim Grinberg: You use it to offset any delusion from issued shares. What will it take for you to be more aggressive in the share by back at what level of stock? I don't really think it's about a level. I think it's about a level of confidence in the environment versus just our own execution and performance. And quite frankly, I think we have to, we will, I know, do a better job on executing and managing our investments as we begin to look at next year.

Efraim Grinberg: We're not, you know, we have no need to, we will curtail thumb this fall, but we are not touching our Mavado campaign, believe that strongly in the importance of that and the benefit to the brand. So we saw opportunities to invest in our business, but obviously the value of the shares, we believe, represent a good value. So we will certainly look at that as the year progresses and as we see the market begin to evolve.

Unknown Attendee: Thank you.

Unknown Attendee: We have reached the end of our question and answer session.

Efraim Grinberg: I would like to turn the conference back over to F-Rome Greenberg for closing remarks.

Efraim Grinberg: Thank you all for joining us today. And as I said, we look forward to improving our operating performance as we begin to look into next year. And I encourage all of you to please visit the Mavado.com website and you will get to really see what we've done. It's the first time that we've completely integrated campaign at the level that we've done it here. And as I said, it's gotten really, really positive review from marketing media as well as a number of different editorials in the marketplace. Thank you again for joining us today. Thank you.

Unknown Attendee: This will conclude today's conference. You may disconnect up this time and thank you for your participation.

Q2 2025 Movado Group Inc Earnings Call

Request a DemoDemo

MOV

Movado Group

Earnings