Reuters logo
UPDATE 2-Movado's Q1 beats Street, to close retail boutique unit
May 27, 2010 / 12:36 PM / in 7 years

UPDATE 2-Movado's Q1 beats Street, to close retail boutique unit

* Q1 adj loss/shr $0.19 vs est loss $0.43/shr

* Q1 sales up 17 pct, beat Street view

* Sees FY 2011 GAAP loss/shr $0.12-EPS of $0.08

* Sees $21.6 mln in charges related to closure

* Shares rise as much as 17 pct (Recasts; adds details)

May 27 (Reuters) - Movado Group Inc (MOV.N) posted a narrower-than-expected quarterly loss, helped by a recovery in consumer demand, and said it will close its retail boutique unit, which is expected to hurt the watchmaker’s 2010 revenue by $30 million.

Shares of the company, which closed at $11.08 Wednesday on the New York Stock Exchange, rose as much as 17 percent to $13 Thursday in morning trade. The company, which distributes watch brands such as Concord, Tommy Hilfiger and Hugo Boss, said it was shutting down the unit, effective June 30, to streamline its business and redirect investment towards higher return businesses. [ID:nWNAB4161]

Movado now plans to sell its products primarily through the wholesale channel and sees restructuring charges related to the closure of $21.6 million over the remainder of 2011.

The company estimates the cash portion of the charges at about $20 million and expects to pay it with existing funds.

It added that its Movado Retail Group (MRG) will continue to sell all of its watch brands directly to consumers through 31 outlet stores.

MRG will also keep the Movado Boutique located in New York’s Rockefeller Center open as a flagship store.

The boutique closures are expected to have no impact on the availability of any of Movado’s watch products.

The company also forecast 2011 outlook of a loss of 12 cents to earnings of 8 cents a share.

For the first-quarter ended April 30, the company posted a net loss of $10.7 million, or 43 cents a share, wider than the net loss of $9.9 million, or 41 cents a share, a year earlier.

Excluding items, it posted a loss of 19 cents a share. However, revenue at the Paramus, New Jersey-based company jumped 17 percent to $78.9 million during the quarter.

Analysts were expecting a loss of 43 cents a share, on revenue of $73.13 million, according to Thomson Reuters I/B/E/S. [ID:nWNAB4169] (Reporting by Shradhha Sharma in Bangalore; Editing by Prem Udayabhanu)

Our Standards:The Thomson Reuters Trust Principles.
0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below