EXHIBIT 99.1
Parlux Announces Results for Third Quarter Ended December 31, 2008
FORT LAUDERDALE, FL--(Marketwire - February 09, 2009) - Parlux Fragrances, Inc. (NASDAQ:PARL) announced today its results for the three and nine-months ended December 31, 2008.
For the third quarter ended December 31, 2008, net sales increased to $47.3 million, compared to $44.5 million for the same prior year period, an increase of 6%. Operating expenses were $31.1 million, compared to $21.9 million for the same prior year period, an increase of 42%. Operating loss was ($7.4 million), compared to operating income of $0.5 million for the same prior year period. Net loss for the three months ended December 31, 2008, was ($4.5 million), compared to net income of $0.2 million for the same prior year period.
For the nine-months ended December 31, 2008, net sales increased to $123.0 million, compared to $113.3 million for the same prior year period, an increase of 9%. Operating expenses were $73.2 million, compared to $51.2 million for the same prior year period, an increase of 43%. Operating loss was ($9.6 million), compared to operating income of $3.9 million for the same prior year period. Net loss for the nine-months ended December 31, 2008, was ($5.8 million), compared to net income of $2.1 million for the same prior year period.
Neil Katz, Chairman and CEO, said, "Strategically, our focus on strengthening our position in U.S. department stores has been a success, with an 82% increase in sales for the third quarter ended December 31, 2008, compared to the same prior year period. The strategy has been expensive financially, with committed advertising investments which could not be reduced in a retail environment which plummeted in the November/December period. Additionally, the global economic turmoil, compounded with a volatile U.S. dollar, negatively impacted our International sales which declined by 34% compared to the same prior year period, further reducing our operating profit."
Mr. Katz continued, "For the nine-months ended December 31, 2008, we have maintained the 82% increase in U.S. department store sales reaching a level of $45 million which will provide positive support for our other business segments in the future. We have successfully launched Jessica Simpson 'Fancy' and Paris Hilton 'Fairy Dust,' and have positioned ourselves for future growth with launches of Queen Latifah and Marc Ecko planned for summer and fall 2009. Looking to the future, we continue to review and reduce costs in all aspects of our operations and staffing, for which we believe the benefit will commence next quarter and continue through next fiscal year. We expect the final quarter of this fiscal year to be profitable, assuming no further major deterioration in the global economy."
Conference Call
The Company will host a conference call on Monday, February 9, 2009, at 9:00AM (EST) to discuss the Company's quarterly results and to provide additional outlook on the next quarter. To participate, please call: Participant Toll Free: 866-852-2121 or Participant International: 416-695-9706 (no digital pin number is required). A replay of the conference call will also be available from Monday, February 9, 2009 after 1:00PM, until 11:59PM February 23, 2009. To access the rebroadcast, Digital Replay Toll Free: 800-408-3053 or Participant International: 416-695-5800 (Replay Passcode: 3280300).
About Parlux Fragrances, Inc.
Parlux Fragrances, Inc. is a manufacturer and international distributor of prestige products. It holds licenses for Paris Hilton, Jessica Simpson, GUESS?, Nicole Miller, Natori, Queen Latifah, Marc Ecko, XOXO, Ocean Pacific (OP), Andy Roddick, babyGund, and Fred Hayman Beverly Hills designer fragrances, as well as Paris Hilton watches, cosmetics, sunglasses, handbags and other small leather accessories.
Certain Information Regarding Forward-Looking Statements
This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, regarding, among other things, our plans, strategies and prospects, both business and financial. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements of the Company or its industry to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. These risks and uncertainties include, among others, future trends in sales, the Company's ability to maintain its current brands and licenses, the Company's ability to successfully introduce, acquire, or launch new brands, licenses, or products in a cost-effective manner, general econo mic conditions, Perfumania's ability to pay its accounts payable balance due to the Company, and continued compliance with the covenants in its credit facility. Additional risk factors are set forth in the Company's periodic reports filed with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date thereof. The Company undertakes no obligation to publicly release the result of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
PARLUX FRAGRANCES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
| | | | | | | | | | | | | |
| | Three Months Ended
December 31, | | Nine Months Ended
December 31, | |
| | 2008 | | 2007 | | 2008 | | 2007 | |
Net sales: | | | | | | | | | | | | | |
Unrelated customers | | $ | 38,546,367 | | $ | 35,055,318 | | $ | 93,839,974 | | $ | 65,493,977 | |
Related parties | | | 8,746,155 | | | 9,488,470 | | | 29,148,863 | | | 47,783,702 | |
| | | 47,292,522 | | | 44,543,788 | | | 122,988,837 | | | 113,277,679 | |
| | | | | | | | | | | | | |
Cost of goods sold: | | | | | | | | | | | | | |
Unrelated customers | | | 18,293,824 | | | 17,143,476 | | | 44,913,421 | | | 33,667,982 | |
Related parties | | | 5,269,761 | | | 5,009,970 | | | 14,397,501 | | | 24,448,783 | |
| | | 23,563,585 | | | 22,153,446 | | | 59,310,922 | | | 58,116,765 | |
| | | | | | | | | | | | | |
Operating expense | | | 31,085,949 | | | 21,896,502 | | | 73,229,720 | | | 51,224,419 | |
| | | | | | | | | | | | | |
Operating (loss) income from continuing operations | | | (7,357,012 | ) | | 493,840 | | | (9,551,805 | ) | | 3,936,495 | |
| | | | | | | | | | | | | |
Interest income (expense), net | | | 40,632 | | | (217,067 | ) | | 238,062 | | | (1,071,394 | ) |
Other income | | | — | | | — | | | — | | | 497,770 | |
Foreign exchange (loss) gain | | | (20 | ) | | 11,875 | | | (1,038 | ) | | 10,034 | |
(Loss) income from continuing operations before income taxes | | | (7,316,400 | ) | | 288,648 | | | (9,314,781 | ) | | 3,372,905 | |
| | | | | | | | | | | | | |
Income tax benefit (provision) | | | 2,780,232 | | | (109,686 | ) | | 3,539,617 | | | (1,281,704 | ) |
| | | | | | | | | | | | | |
(Loss) income from continuing operations | | | (4,536,168 | ) | | 178,962 | | | (5,775,164 | ) | | 2,091,201 | |
| | | | | | | | | | | | | |
Discontinued operations: | | | | | | | | | | | | | |
Income from operations of Perry Ellis fragrance brand | | | — | | | 5,999 | | | — | | | 40,887 | |
Income tax provision related to Perry Ellis brand | | | — | | | (2,280 | ) | | — | | | (15,537 | ) |
| | | | | | | | | | | | | |
Income from discontinued operations | | | — | | | 3,719 | | | — | | | 25,350 | |
| | | | | | | | | | | | | |
Net (loss) income | | | (4,536,168 | ) | | 182,681 | | | (5,775,164 | ) | | 2,116,551 | |
| | | | | | | | | | | | | |
Diluted (loss) income per common share: | | | | | | | | | | | | | |
Continuing operations | | $ | (0.22 | ) | $ | 0.01 | | $ | (0.28 | ) | $ | 0.10 | |
Discontinued operations | | | 0.00 | | | 0.00 | | | 0.00 | | | 0.00 | |
Total | | $ | (0.22 | ) | $ | 0.01 | | $ | (0.28 | ) | $ | 0.10 | |
| | | | | | | | | | | | | |
Weighted average diluted shares outstanding | | | 20,503,489 | | | 20,754,364 | | | 20,607,321 | | | 20,532,613 | |
PARLUX FRAGRANCES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET DATA
| | | | | | | |
| | December 31, 2008 | | March 31, 2008 | |
| | | | | | | |
Cash and cash equivalents | | $ | 9,889,249 | | $ | 21,408,167 | |
Trade receivables, net | | | 39,286,413 | | | 34,693,173 | |
Inventories | | | 60,460,035 | | | 48,068,280 | |
Other current assets | | | 24,027,067 | | | 18,163,338 | |
Current Assets | | | 133,662,764 | | | 122,332,958 | |
| | | | | | | |
| | | | | | | |
Equipment and leasehold improvements, net | | | 3,054,902 | | | 4,093,091 | |
Trademarks and licenses, net | | | 2,110,207 | | | 2,770,211 | |
Other assets | | | 3,346,152 | | | 1,951,680 | |
Total Assets | | $ | 142,174,025 | | $ | 131,147,940 | |
| | | | | | | |
Borrowings, current portion | | $ | 787,186 | | $ | 990,953 | |
Other current liabilities | | | 32,418,663 | | | 14,048,769 | |
Current Liabilities | | | 33,205,849 | | | 15,039,722 | |
Borrowings, less current portion | | | 3,764 | | | 542,633 | |
Total Liabilities | | | 33,209,613 | | | 15,582,355 | |
| | | | | | | |
Stockholders' Equity | | | 108,964,412 | | | 115,565,585 | |
Total Liabilities and Stockholders' Equity | | $ | 142,174,025 | | $ | 131,147,940 | |
******
Parlux Fragrances, Inc.
(954) 316-9008
CONTACT:
Neil J. Katz, Ext. 8116
Raymond J. Balsys, Ext. 8106
Web site:http://www.parlux.com
