Document and Entity Information
Document and Entity Information - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Mar. 09, 2018 | Jun. 30, 2017 | |
Document And Entity Information [Abstract] | |||
Entity Registrant Name | INTER PARFUMS INC | ||
Entity Central Index Key | 822,663 | ||
Document Type | 10-K | ||
Trading Symbol | IPAR | ||
Document Period End Date | Dec. 31, 2017 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Entity a Well-known Seasoned Issuer | No | ||
Entity a Voluntary Filer | No | ||
Entity's Reporting Status Current | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Public Float | $ 622,944,744 | ||
Entity Common Stock, Shares Outstanding | 31,270,893 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2,017 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 208,343 | $ 161,828 |
Short-term investments | 69,899 | 94,202 |
Accounts receivable, net | 120,749 | 104,819 |
Inventories | 137,058 | 96,977 |
Receivables, other | 2,405 | 7,433 |
Other current assets | 7,356 | 6,240 |
Income taxes receivable | 3,468 | 626 |
Total current assets | 549,278 | 472,125 |
Equipment and leasehold improvements, net | 10,330 | 10,076 |
Trademarks, licenses and other intangible assets, net | 200,495 | 183,868 |
Deferred tax assets | 9,658 | 8,090 |
Other assets | 8,011 | 8,250 |
Total assets | 777,772 | 682,409 |
Current liabilities: | ||
Current portion of long-term debt | 24,372 | 21,498 |
Accounts payable - trade | 52,609 | 49,507 |
Accrued expenses | 81,843 | 62,609 |
Income taxes payable | 1,722 | 3,331 |
Dividends payable | 6,561 | 5,293 |
Total current liabilities | 167,107 | 142,238 |
Long-term debt, less current portion | 36,207 | 53,064 |
Deferred tax liability | 3,821 | 3,449 |
Inter Parfums, Inc. shareholders' equity: | ||
Preferred stock, $0.001 par value. Authorized 1,000,000 shares; none issued | ||
Common stock, $0.001 par value. Authorized 100,000,000 shares; outstanding, 31,241,548 and 31,138,318 shares at December 31, 2017 and 2016, respectively | 31 | 31 |
Additional paid-in capital | 66,004 | 63,103 |
Retained earnings | 422,570 | 402,714 |
Accumulated other comprehensive loss | (17,832) | (57,982) |
Treasury stock, at cost, 9,864,805 common shares at December 31, 2017 and 2016 | (37,475) | (37,475) |
Total Inter Parfums, Inc. shareholders' equity | 433,298 | 370,391 |
Noncontrolling interest | 137,339 | 113,267 |
Total equity | 570,637 | 483,658 |
Total liabilities and equity | $ 777,772 | $ 682,409 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2017 | Dec. 31, 2016 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, authorized | 1,000,000 | 1,000,000 |
Preferred stock, issued | ||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, authorized | 100,000,000 | 100,000,000 |
Common stock, outstanding | 31,241,548 | 31,138,318 |
Treasury stock | 9,864,805 | 9,864,805 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Statement [Abstract] | |||
Net sales | $ 591,251 | $ 521,072 | $ 468,540 |
Cost of sales | 214,965 | 194,601 | 179,069 |
Gross margin | 376,286 | 326,471 | 289,471 |
Selling, general, and administrative expenses | 295,540 | 258,787 | 228,268 |
Gain on buyout of license | (4,652) | ||
Impairment loss | 2,123 | 5,658 | |
Income from operations | 78,623 | 66,678 | 61,203 |
Other expenses (income): | |||
Interest expense | 1,992 | 2,340 | 2,826 |
Loss on foreign currency | 1,549 | 595 | 876 |
Interest income | (2,983) | (3,331) | (2,995) |
Other expenses (income) | 558 | (396) | 707 |
Income before income taxes | 78,065 | 67,074 | 60,496 |
Income taxes | 22,812 | 23,826 | 21,527 |
Net income | 55,253 | 43,248 | 38,969 |
Less: Net income attributable to the noncontrolling interest | 13,659 | 9,917 | 8,532 |
Net income attributable to Inter Parfums, Inc. | $ 41,594 | $ 33,331 | $ 30,437 |
Net income attributable to Inter Parfums, Inc. common shareholders: | |||
Basic (in dollars per share) | $ 1.33 | $ 1.07 | $ 0.98 |
Diluted (in dollars per share) | $ 1.33 | $ 1.07 | $ 0.98 |
Weighted average number of shares outstanding: | |||
Basic (in shares) | 31,172,285 | 31,072,328 | 30,996,137 |
Diluted (in shares) | 31,305,101 | 31,175,598 | 31,100,215 |
Dividends declared per share (in dollars per share) | $ 0.72 | $ 0.62 | $ 0.52 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Statement of Comprehensive Income [Abstract] | |||
Net income | $ 55,253 | $ 43,248 | $ 38,969 |
Other comprehensive income (loss): | |||
Net derivative instrument loss, net of tax | 54 | (22) | |
Transfer of OCI into earnings | 22 | ||
Translation adjustments, net of tax | 55,995 | (13,153) | (44,346) |
Other comprehensive income (loss) | 56,071 | (13,175) | (44,346) |
Comprehensive income (loss) | 111,324 | 30,073 | (5,377) |
Comprehensive income (loss) attributable to noncontrolling interests: | |||
Net income | 13,659 | 9,917 | 8,532 |
Net derivative instrument loss, net of tax | 17 | (5) | |
Transfer of OCI into earnings | 5 | ||
Translation adjustments, net of tax | 15,899 | (3,279) | (12,078) |
Comprehensive income attributable to the noncontrolling interests | 29,580 | 6,633 | (3,546) |
Comprehensive income (loss) attributable to Inter Parfums Inc.: | $ 81,744 | $ 23,440 | $ (1,831) |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders' Equity - USD ($) $ in Thousands | Common Stock [Member] | Additional Paid-In Capital [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income (loss) [Member] | Treasury Stock [Member] | Noncontrolling Interest [Member] | Total |
Balance, beginning at Dec. 31, 2014 | $ 31 | $ 60,200 | $ 374,121 | $ (15,823) | $ (36,464) | $ 116,659 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Shares issued upon exercise of stock options | 1,234 | 140 | |||||
Shares received as proceeds of option exercises | (493) | ||||||
Sale of subsidiary shares to noncontrolling interest | (192) | 1,523 | |||||
Net income | 30,437 | 8,532 | $ 38,969 | ||||
Dividends | (16,124) | (3,836) | |||||
Stock-based compensation | 788 | ||||||
Purchase of subsidiary shares from noncontrolling interest | |||||||
Foreign currency translation adjustment, net of tax | (32,268) | (12,078) | (44,346) | ||||
Transfer from other comprehensive income into earnings | |||||||
Net derivative instrument gain, net of tax | |||||||
Balance, ending at Dec. 31, 2015 | 31 | 62,030 | 388,434 | (48,091) | (36,817) | 110,800 | 476,387 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Shares issued upon exercise of stock options | 2,160 | 142 | |||||
Shares received as proceeds of option exercises | (800) | ||||||
Sale of subsidiary shares to noncontrolling interest | (173) | 1,738 | |||||
Net income | 33,331 | 9,917 | 43,248 | ||||
Dividends | (19,273) | (4,863) | |||||
Stock-based compensation | 839 | 222 | 147 | ||||
Purchase of subsidiary shares from noncontrolling interest | (1,753) | (1,188) | |||||
Foreign currency translation adjustment, net of tax | (9,874) | (3,279) | (13,153) | ||||
Transfer from other comprehensive income into earnings | |||||||
Net derivative instrument gain, net of tax | (17) | (5) | |||||
Balance, ending at Dec. 31, 2016 | 31 | 63,103 | 402,714 | (57,982) | (37,475) | 113,267 | 483,658 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Shares issued upon exercise of stock options | 1,963 | ||||||
Shares received as proceeds of option exercises | |||||||
Sale of subsidiary shares to noncontrolling interest | |||||||
Net income | 41,594 | 13,659 | 55,253 | ||||
Dividends | (22,460) | (6,039) | |||||
Stock-based compensation | 938 | 722 | 531 | ||||
Purchase of subsidiary shares from noncontrolling interest | |||||||
Foreign currency translation adjustment, net of tax | 40,096 | 15,899 | 55,995 | ||||
Transfer from other comprehensive income into earnings | 17 | 5 | |||||
Net derivative instrument gain, net of tax | 37 | 17 | |||||
Balance, ending at Dec. 31, 2017 | $ 31 | $ 66,004 | $ 422,570 | $ (17,832) | $ (37,475) | $ 137,339 | $ 570,637 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Cash flows from operating activities: | |||
Net income | $ 55,253 | $ 43,248 | $ 38,969 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization including impairment loss | 11,914 | 15,341 | 9,078 |
Provision for doubtful accounts | 939 | 349 | 442 |
Noncash stock compensation | 2,093 | 1,198 | 787 |
Gain on sale of license | (4,652) | ||
Excess tax benefits from stock-based compensation arrangements | (260) | ||
Deferred tax expense (benefit) | (591) | (1,374) | 829 |
Change in fair value of derivatives | (1,254) | 682 | 903 |
Changes in: | |||
Accounts receivable | (6,016) | (13,156) | (12,573) |
Inventories | (28,518) | (909) | (4,354) |
Other assets | 727 | (297) | (1,622) |
Accounts payable and accrued expenses | 5,696 | 18,690 | 12,973 |
Income taxes, net | (4,352) | (4,556) | 4,912 |
Net cash provided by operating activities | 35,891 | 54,564 | 50,084 |
Cash flows from investing activities: | |||
Purchases of short-term investments | (31,874) | (57,289) | (62,415) |
Proceeds from sale of short-term investments | 66,981 | 42,604 | 151,771 |
Purchase of equipment and leasehold improvements | (3,023) | (4,777) | (4,158) |
Payment for intangible assets acquired | (1,046) | (965) | (119,788) |
Proceeds from sale of trademark | 5,886 | ||
Net cash provided by (used in) investing activities | 36,924 | (20,427) | (34,590) |
Cash flows from financing activities: | |||
Proceeds from issuance of long-term debt | 110,970 | ||
Repayment of long-term debt | (22,362) | (21,884) | (11,761) |
Purchase of treasury stock | (77) | (32) | |
Proceeds from exercise of options | 1,963 | 1,579 | 653 |
Excess tax benefits from stock-based compensation arrangements | 260 | ||
Proceeds from sale of stock of subsidiary | 1,565 | 1,327 | |
Dividends paid | (21,192) | (18,015) | (15,806) |
Dividends paid to noncontrolling interests | (6,039) | (4,863) | (3,836) |
Purchase of subsidiary shares from noncontrolling interests | (2,941) | ||
Net cash provided by (used in) financing activities | (47,630) | (44,636) | 81,775 |
Effect of exchange rate changes on cash | 21,330 | (4,640) | (10,440) |
Net increase (decrease) in cash and cash equivalents | 46,515 | (15,139) | 86,829 |
Cash and cash equivalents - beginning of year | 161,828 | 176,967 | 90,138 |
Cash and cash equivalents - end of year | 208,343 | 161,828 | 176,967 |
Cash paid for: | |||
Interest | 1,813 | 2,239 | 2,400 |
Income taxes | $ 24,337 | $ 28,124 | $ 19,668 |
The Company and its Significant
The Company and its Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
The Company and its Significant Accounting Policies | (1) The Company and its Significant Accounting Policies Business of the Company Inter Parfums, Inc. and its subsidiaries (the “Company”) are in the fragrance business and manufacture and distribute a wide array of fragrances and fragrance related products. Substantially all of our prestige fragrance brands are licensed from unaffiliated third parties, and our business is dependent upon the continuation and renewal of such licenses. With respect to the Company’s largest brands, we own the Lanvin brand name for our class of trade, and license the Montblanc and Jimmy Choo brand names. As a percentage of net sales, product sales for the Company’s largest brands were as follows: Year Ended December 31, 2017 2016 2015 Montblanc 21 % 23 % 21 % Jimmy Choo 18 % 17 % 20 % Lanvin 11 % 12 % 15 % No other brand represented 10% or more of consolidated net sales. Basis of Preparation The consolidated financial statements include the accounts of the Company, including 73% owned Interparfums SA, a subsidiary whose stock is publicly traded in France. In 2015, Interparfums SA formed a subsidiary in Spain, Parfums Rochas. The subsidiary is 51% owned by Interparfums SA with the remaining 49% owned by its Rochas distributor for Spain. The subsidiary is responsible for Rochas brand distribution in the territory. All material intercompany balances and transactions have been eliminated. Management Estimates Management makes assumptions and estimates to prepare financial statements in conformity with accounting principles generally accepted in the United States of America. Those assumptions and estimates directly affect the amounts reported and disclosures included in the consolidated financial statements. Actual results could differ from those assumptions and estimates. Significant estimates for which changes in the near term are considered reasonably possible and that may have a material impact on the financial statements are disclosed in these notes to the consolidated financial statements. Foreign Currency Translation For foreign subsidiaries with operations denominated in a foreign currency, assets and liabilities are translated to U.S. dollars at year-end exchange rates. Income and expense items are translated at average rates of exchange prevailing during the year. Gains and losses from translation adjustments are accumulated in a separate component of shareholders’ equity. Cash and Cash Equivalents and Short-Term Investments All highly liquid investments purchased with a maturity of three months or less are considered to be cash equivalents. From time to time, the Company has short-term investments which consist of certificates of deposit with maturities greater than three months. The Company monitors concentrations of credit risk associated with financial institutions with which the Company conducts significant business. The Company believes its credit risk is minimal, as the Company primarily conducts business with large, well-established financial institutions. Substantially all cash and cash equivalents are held at financial institutions outside the United States and are readily convertible into U.S. dollars. Accounts Receivable Accounts receivable represent payments due to the Company for previously recognized net sales, reduced by allowances for sales returns and doubtful accounts or balances which are estimated to be uncollectible, which aggregated $5.1 million and $5.3 million as of December 31, 2017 and 2016, respectively. Accounts receivable balances are written-off against the allowance for doubtful accounts when they become uncollectible. Recoveries of accounts receivable previously recorded against the allowance are recorded in the consolidated statement of income when received. We generally grant credit based upon our analysis of the customer’s financial position, as well as previously established buying patterns. Inventories Inventories, including promotional merchandise, only include inventory considered saleable or usable in future periods, and is stated at the lower of cost and net realizable value, with cost being determined on the first-in, first-out method. Cost components include raw materials, direct labor and overhead (e.g., indirect labor, utilities, depreciation, purchasing, receiving, inspection and warehousing) as well as inbound freight. Promotional merchandise is charged to cost of sales at the time the merchandise is shipped to the Company’s customers. Derivatives All derivative instruments are recorded as either assets or liabilities and measured at fair value. The Company uses derivative instruments to principally manage a variety of market risks. For derivatives designated as hedges of the exposure to changes in fair value of the recognized asset or liability or a firm commitment (referred to as fair value hedges), the gain or loss is recognized in earnings in the period of change together with the offsetting loss or gain on the hedged item attributable to the risk being hedged. The effect of that accounting is to include in earnings the extent to which the hedge is not effective in achieving offsetting changes in fair value. For cash flow hedges, the effective portion of the derivative’s gain or loss is initially reported in equity (as a component of accumulated other comprehensive income) and is subsequently reclassified into earnings in the same period or periods during which the hedged forecasted transaction affects earnings. The ineffective portion of the gain or loss of a cash flow hedge is reported in earnings immediately. The Company also holds certain instruments for economic purposes that are not designated for hedge accounting treatment. For these derivative instruments, changes in their fair value are recorded in earnings immediately. Equipment and Leasehold Improvements Equipment and leasehold improvements are stated at cost less accumulated depreciation and amortization. Depreciation and amortization are provided using the straight-line method over the estimated useful lives for equipment, which range between three and ten years and the shorter of the lease term or estimated useful asset lives for leasehold improvements. Depreciation provided on equipment used to produce inventory, such as tools and molds, is included in cost of sales. Long-Lived Assets Indefinite-lived intangible assets principally consist of trademarks which are not amortized. The Company evaluates indefinite-lived intangible assets for impairment at least annually during the fourth quarter, or more frequently when events occur or circumstances change, such as an unexpected decline in sales, that would more likely than not indicate that the carrying value of an indefinite-lived intangible asset may not be recoverable. When testing indefinite-lived intangible assets for impairment, the evaluation requires a comparison of the estimated fair value of the asset to the carrying value of the asset. The fair values used in our evaluations are estimated based upon discounted future cash flow projections using a weighted average cost of capital of 6.22% in both 2017 and 2016. The cash flow projections are based upon a number of assumptions, including future sales levels, future cost of goods and operating expense levels, as well as economic conditions, changes to our business model or changes in consumer acceptance of our products which are more subjective in nature. If the carrying value of an indefinite-lived intangible asset exceeds its fair value, an impairment charge is recorded. Intangible assets subject to amortization are evaluated for impairment testing whenever events or changes in circumstances indicate that the carrying amount of an amortizable intangible asset may not be recoverable. If impairment indicators exist for an amortizable intangible asset, the undiscounted future cash flows associated with the expected service potential of the asset are compared to the carrying value of the asset. If our projection of undiscounted future cash flows is in excess of the carrying value of the intangible asset, no impairment charge is recorded. If our projection of undiscounted future cash flows is less than the carrying value of the intangible asset, an impairment charge would be recorded to reduce the intangible asset to its fair value. Revenue Recognition The Company sells its products to department stores, perfumeries, specialty stores and domestic and international wholesalers and distributors. Sales of such products by our domestic subsidiaries are denominated in U.S. dollars, and sales of such products by our foreign subsidiaries are primarily denominated in either euro or U.S. dollars. The Company recognizes revenues when title, ownership, and risk of loss pass to the customer, all of which occurs upon shipment or delivery of the product and is based on the applicable shipping terms. Net sales are comprised of gross revenues less returns, trade discounts and allowances. The Company does not bill its customers’ freight and handling charges. All shipping and handling costs, which aggregated $5.9 million, $5.1 million and $4.7 million in 2017, 2016 and 2015, respectively, are included in selling, general and administrative expenses in the consolidated statements of income. The Company grants credit to all qualified customers and does not believe it is exposed significantly to any undue concentration of credit risk. No one customer represented 10% or more of net sales in 2017, 2016 or 2015. Sales Returns Generally, the Company does not permit customers to return their unsold products. However, for U.S. based customers, we allow returns if properly requested, authorized and approved. The Company regularly reviews and revises, as deemed necessary, its estimate of reserves for future sales returns based primarily upon historic trends and relevant current data including information provided by retailers regarding their inventory levels. In addition, as necessary, specific accruals may be established for significant future known or anticipated events. The types of known or anticipated events that we consider include, but are not limited to, the financial condition of our customers, store closings by retailers, changes in the retail environment and our decision to continue to support new and existing products. The Company records estimated reserves for sales returns as a reduction of sales, cost of sales and accounts receivable. Returned products are recorded as inventories and are valued based upon estimated realizable value. The physical condition and marketability of returned products are the major factors we consider in estimating realizable value. Actual returns, as well as estimated realizable values of returned products, may differ significantly, either favorably or unfavorably, from our estimates, if factors such as economic conditions, inventory levels or competitive conditions differ from our expectations. Payments to Customers The Company records revenues generated from purchase with purchase and gift with purchase promotions as sales and the costs of its purchase with purchase and gift with purchase promotions as cost of sales. Certain other incentive arrangements require the payment of a fee to customers based on their attainment of pre-established sales levels. These fees have been recorded as a reduction of net sales. Advertising and Promotion Advertising and promotional costs are expensed as incurred and recorded as a component of cost of goods sold (in the case of free goods given to customers) or selling, general and administrative expenses. Advertising and promotional costs included in selling, general and administrative expenses were $123.7 million, $99.0 million and $83.8 million for 2017, 2016 and 2015, respectively. Costs relating to purchase with purchase and gift with purchase promotions that are reflected in cost of sales aggregated $33.8 million, $30.0 million and $25.4 million in 2017, 2016 and 2015, respectively. Package Development Costs Package development costs associated with new products and redesigns of existing product packaging are expensed as incurred. Operating Leases The Company recognizes rent expense from operating leases with various step rent provisions, rent concessions and escalation clauses on a straight-line basis over the applicable lease term. The Company considers lease renewals in the useful life of its leasehold improvements when such renewals are reasonably assured. In the event the Company receives capital improvement funding from its landlord, these amounts are recorded as deferred liabilities and amortized over the remaining lease term as a reduction of rent expense. License Agreements The Company’s license agreements generally provide the Company with worldwide rights to manufacture, market and sell fragrance and fragrance related products using the licensors’ trademarks. The licenses typically have an initial term of approximately 5 to 15 years, and are potentially renewable subject to the Company’s compliance with the license agreement provisions. The remaining terms, including the potential renewal periods, range from approximately 1 to 15 years. Under each license, the Company is required to pay royalties in the range of 5% to 10% to the licensor, at least annually, based on net sales to third parties. In certain cases, the Company may pay an entry fee to acquire, or enter into, a license where the licensor or another licensee was operating a pre-existing fragrance business. In those cases, the entry fee is capitalized as an intangible asset and amortized over its useful life. Most license agreements require minimum royalty payments, incremental royalties based on net sales levels and minimum spending on advertising and promotional activities. Royalty expenses are accrued in the period in which net sales are recognized while advertising and promotional expenses are accrued at the time these costs are incurred. In addition, the Company is exposed to certain concentration risk. Substantially all of our prestige fragrance brands are licensed from unaffiliated third parties, and our business is dependent upon the continuation and renewal of such licenses. Income Taxes The Company accounts for income taxes using an asset and liability approach that requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in its financial statements or tax returns. The net deferred tax assets assume sufficient future earnings for their realization, as well as the continued application of currently enacted tax rates. Included in net deferred tax assets is a valuation allowance for deferred tax assets, where management believes it is more-likely-than-not that the deferred tax assets will not be realized in the relevant jurisdiction. If the Company determines that a deferred tax asset will not be realizable, an adjustment to the deferred tax asset will result in a reduction of net earnings at that time. Accrued interest and penalties are included within the related tax asset or liability in the accompanying financial statements. Issuance of Common Stock by Consolidated Subsidiary The difference between the Company’s share of the proceeds received by the subsidiary and the carrying amount of the portion of the Company’s investment deemed sold, is reflected as an equity adjustment in the consolidated balance sheets. Treasury Stock The Board of Directors may authorize share repurchases of the Company’s common stock (Share Repurchase Authorizations). Share repurchases under Share Repurchase Authorizations may be made through open market transactions, negotiated purchase or otherwise, at times and in such amounts within the parameters authorized by the Board. Shares repurchased under Share Repurchase Authorizations are held in treasury for general corporate purposes, including issuances under various employee stock option plans. Treasury shares are accounted for under the cost method and reported as a reduction of equity. Share Repurchase Authorizations may be suspended, limited or terminated at any time without notice. Recent Accounting Pronouncements In August 2017, the Financial Accounting Standards Board (“FASB”) issued an Accounting Standards Update (“ASU”) to improve accounting for hedging activities. The objective of the ASU is to improve the financial reporting of hedging relationships in order to better portray the economic results of an entity’s risk management activities in its financial statements and to make certain targeted improvements to simplify the application of hedge accounting guidance. This ASU is effective for annual and interim periods beginning after December 15, 2018 and early adoption is permitted. We are currently evaluating the standard to determine the impact of its adoption on our consolidated financial statements. In August 2016, the FASB issued an ASU to eliminate the diversity in practice related to the classification of certain cash receipts and payments in the statement of cash flows, by adding or clarifying guidance on eight specific cash flow issues. This ASU is effective for annual and interim periods beginning after December 15, 2017 and early adoption is permitted. We have evaluated the standard and determined that there will be no material impact on our consolidated financial statements. In February 2016, the FASB issued an ASU which requires lessees to recognize lease assets and lease liabilities arising from operating leases on the balance sheet. This ASU is effective for annual and interim reporting periods beginning after December 15, 2018 using a modified retrospective approach, with early adoption permitted. We are currently evaluating the standard to determine the impact of its adoption on our consolidated financial statements. In November 2015, the FASB issued an ASU that requires all deferred tax liabilities and assets to be classified as noncurrent on the balance sheet. This ASU is effective for annual and interim reporting periods beginning after December 15, 2016. In January 2017, the Company adopted the standard retrospectively, which resulted in reclassifications among accounts on the consolidated balance sheet, but had no other impact on our results of operations, financial condition or cash flows. The effect of the adoption on prior periods was a reclassification from current assets to noncurrent assets of approximately $8 million. In May 2014, the FASB issued an ASU which superseded the most current revenue recognition requirements. This new revenue recognition standard requires entities to recognize revenue in a way that depicts the transfer of goods or services to customers in an amount that reflects the consideration which the entity expects to be entitled to in exchange for those goods or services. The new standard also includes enhanced disclosure requirements. This guidance is effective for annual and interim reporting periods beginning after December 15, 2017, with early adoption permitted for annual periods after December 31, 2016. We have adopted the standard as of December 31, 2017 and determined that other than a modification of our revenue recognition policy, there has been no material impact on our consolidated financial statements. There are no other recent accounting pronouncements issued but not yet adopted that would have a material effect on our consolidated financial statements. |
Buyout of License
Buyout of License | 12 Months Ended |
Dec. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Buyout of License | (2) Buyout of License In December 2016, the Company reached an agreement with the Balmain brand calling for Balmain to buyout the Balmain license agreement, effective December 31, 2016, in exchange for a payment aggregating $5.7 million. As a result of the buyout, the Company recognized a gain of $4.7 million as of December 31, 2016, and received the buyout payment in May 2017. |
Recent Agreements
Recent Agreements | 12 Months Ended |
Dec. 31, 2017 | |
Recent Agreements [Abstract] | |
Recent Agreements | (3) Recent Agreements Guess In February 2018, the Company entered into an exclusive, 15-year worldwide license agreement with GUESS for the creation, development and distribution of fragrances under the GUESS brand. This license will take effect on April 1, 2018, and our rights under such license agreement are subject to certain minimum advertising expenditures and royalty payments as are customary in our industry. Jimmy Choo License Renewal In December 2017, the Company and J Choo Ltd amended their license agreement and extended their partnership through December 31, 2031, without any material changes in operating conditions from the prior license. Our initial Jimmy Choo license was signed in 2009. Paul Smith License Renewal In May 2017, the Company renewed its license agreement with Paul Smith by an additional four years. The original agreement, signed in December 1998, together with previous extensions, provided the Company with the exclusive worldwide license rights to create, produce and distribute fragrances and fragrance related products under the Paul Smith brand through December 31, 2017. The recent extension extends the partnership through December 31, 2021 without any material changes in operating conditions from the prior license. The license agreement is subject to certain minimum sales, advertising expenditures and royalty payments as are customary in our industry. S.T. Dupont License Renewal In September 2016, the Company extended its license agreement with S.T. Dupont by three years. The original agreement, signed in July 1997, together with previous extensions, provided the Company with the exclusive worldwide license rights to create, produce and distribute fragrances and related products under the S.T. Dupont brand through December 31, 2016. The recent extension is effective on January 1, 2017 and extends the partnership through December 31, 2019 without any material changes in operating conditions from the prior license. The license agreement is subject to certain minimum sales, advertising expenditures and royalty payments, as are customary in our industry. |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2017 | |
Inventory Disclosure [Abstract] | |
Inventories | (4) Inventories December 31, 2017 2016 Raw materials and component parts $ 46,884 $ 36,821 Finished goods 90,174 60,156 $ 137,058 $ 96,977 Overhead included in inventory aggregated $5.0 million and $3.1 million as of December 31, 2017 and 2016, respectively. Included in inventories is an inventory reserve, which represents the difference between the cost of the inventory and its estimated realizable value, based upon sales forecasts and the physical condition of the inventories. In addition, and as necessary, specific reserves for future known or anticipated events may be established. Inventory reserves aggregated $5.4 million as of December 31, 2017 and 2016. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | (5) Fair Value of Financial Instruments The following tables present our financial assets and liabilities that are measured at fair value on a recurring basis and are categorized using the fair value hierarchy. The fair value hierarchy has three levels based on the reliability of the inputs used to determine fair value. Fair Value Measurements at December 31, 2017 Quoted Prices in Significant Other Significant Active Markets for Observable Unobservable Identical Assets Inputs Inputs Total (Level 1) (Level 2) (Level 3) Assets: Short-term investments $ 69,899 $ — $ 69,899 $ — Foreign currency forward exchange contracts accounted for using hedge accounting 26 26 Foreign currency forward exchange contracts not accounted for using hedge accounting 119 — 119 — $ 70,044 $ — $ 70,044 $ — Liabilities: Interest rate swap $ 529 $ — $ 529 $ — Fair Value Measurements at December 31, 2016 Quoted Prices in Significant Other Significant Active Markets for Observable Unobservable Identical Assets Inputs Inputs Total (Level 1) (Level 2) (Level 3) Assets: Short-term investments $ 94,202 $ — $ 94,202 $ — Liabilities: Foreign currency forward exchange contracts accounted for using hedge accounting $ 181 $ — $ 181 $ — Foreign currency forward exchange contracts not accounted for using hedge accounting 418 — 418 — Interest rate swap 908 — 908 — $ 1,507 $ — $ 1,507 $ — The carrying amount of cash and cash equivalents including money market funds, short-term investments, accounts receivable, other receivables, accounts payable and accrued expenses approximates fair value due to the short terms to maturity of these instruments. The carrying amount of loans payable approximates fair value as the variable interest rates on the Company’s indebtedness approximate current market rates. Foreign currency forward exchange contracts are valued based on quotations from financial institutions and the value of interest rate swaps are the discounted net present value of the swaps using third party quotes from financial institutions. |
Derivative Financial Instrument
Derivative Financial Instruments | 12 Months Ended |
Dec. 31, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | (6) Derivative Financial Instruments The Company enters into foreign currency forward exchange contracts to hedge exposure related to receivables denominated in a foreign currency and occasionally to manage risks related to future sales expected to be denominated in a foreign currency. Before entering into a derivative transaction for hedging purposes, it is determined that a high degree of initial effectiveness exists between the change in value of the hedged item and the change in the value of the derivative instrument from movement in exchange rates. High effectiveness means that the change in the cash flows of the derivative instrument will effectively offset the change in the cash flows of the hedged item. The effectiveness of each hedged item is measured throughout the hedged period and is based on the dollar offset methodology and excludes the portion of the fair value of the foreign currency forward exchange contract attributable to the change in spot-forward difference which is reported in current period earnings. Any hedge ineffectiveness is also recognized as a gain or loss on foreign currency in the income statement. For hedge contracts that are no longer deemed highly effective, hedge accounting is discontinued and gains and losses accumulated in other comprehensive income are reclassified to earnings. If it is probable that the forecasted transaction will no longer occur, then any gains or losses accumulated in other comprehensive income are reclassified to current-period earnings. In connection with the Rochas acquisition, $108 million of the purchase price was paid in cash on the closing date and was financed entirely through a 5-year term loan. As the payment at closing was due in dollars and we had planned to finance it with debt in euro, the Company entered into foreign currency forward contracts to secure the exchange rate for the $108 million purchase price at $1.067 per 1 euro. This derivative was designated and qualified as a cash flow hedge. Gains and losses in derivatives designated as hedges are accumulated in other comprehensive income (loss) and gains and losses in derivatives not designated as hedges are included in (gain) loss on foreign currency on the accompanying income statements. Such gains and losses were immaterial in each of the years in the three-year period ended December 31, 2017. For the years ended December 31, 2017 and 2016, interest expense includes a gain of $0.5 million and $0.1 million, respectively, relating to an interest rate swap. All derivative instruments are reported as either assets or liabilities on the balance sheet measured at fair value. The valuation of interest rate swaps resulted in a liability which is included in long-term debt on the accompanying balance sheets. The valuation of foreign currency forward exchange contracts at December 31, 2017, resulted in an asset and is included in other current assets on the accompanying balance sheet. The valuation of foreign currency forward exchange contracts at December 31, 2016, resulted in a liability and is included in accrued expenses on the accompanying balance sheet. At December 31, 2017, the Company had foreign currency contracts in the form of forward exchange contracts with notional amounts of approximately U.S. $10.1 million, GB £8.0 million and JPY ¥18.0 million, which all have maturities of less than one year. |
Equipment and Leasehold Improve
Equipment and Leasehold Improvements | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Equipment and Leasehold Improvements | (7) Equipment and Leasehold Improvements December 31, 2017 2016 Equipment $ 37,074 $ 31,325 Leasehold improvements 1,639 1,635 38,713 32,960 Less accumulated depreciation and amortization 28,383 22,884 $ 10,330 $ 10,076 Depreciation and amortization expense was $3.8 million, $3.7 million and $3.3 million in 2017, 2016, and 2015, respectively. |
Trademarks, Licenses and Other
Trademarks, Licenses and Other Intangible Assets | 12 Months Ended |
Dec. 31, 2017 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |
Trademarks, Licenses and Other Intangible Assets | (8) Trademarks, Licenses and Other Intangible Assets 2017 Gross Accumulated Net Book Amount Amortization Value Trademarks (indefinite lives) $ 129,033 $ — $ 129,033 Trademarks (finite lives) 46,461 72 46,389 Licenses (finite lives) 69,439 46,857 22,582 Other intangible assets (finite lives) 14,949 12,458 2,491 Subtotal 130,849 59,387 71,462 Total $ 259,882 $ 59,387 $ 200,495 2016 Gross Accumulated Net Book Amount Amortization Value Trademarks (indefinite lives) $ 115,793 $ — $ 115,793 Trademarks (finite lives) 40,794 63 40,731 Licenses (finite lives) 62,102 37,206 24,896 Other intangible assets (finite lives) 12,861 10,413 2,448 Subtotal 115,757 47,682 68,075 Total $ 231,550 $ 47,682 $ 183,868 Amortization expense was $6.0 million, $5.9 million and $5.8 million in 2017, 2016 and 2015, respectively. Amortization expense is expected to approximate $6.1 million, $3.9 million, and $3.4 million in 2018, 2019, 2020, respectively, and $2.8 million 2021 and 2022. The weighted average amortization period for trademarks, licenses and other intangible assets with finite lives are 18 years, 14 years and 2 years, respectively, and 14 years on average. The Company reviews intangible assets with indefinite lives for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. There were no impairment charges for trademarks with indefinite useful lives in 2016 and 2015. Product sales of some of our legacy mass market product lines have been declining for many years and now represent a very small portion of our net sales. During the fourth quarter of 2017, the Company set in motion a plan to discontinue several of these product lines over the next few years. As a result, the Company recorded an impairment loss of $2.1 million as of December 31, 2017, which represented approximately 50% of total intangible assets relating to our mass market product lines. The fair values used in our evaluations are estimated based upon discounted future cash flow projections using a weighted average cost of capital of 6.22%. The cash flow projections are based upon a number of assumptions, including, future sales levels and future cost of goods and operating expense levels, as well as economic conditions, changes to our business model or changes in consumer acceptance of our products which are more subjective in nature. The Company believes that the assumptions it has made in projecting future cash flows for the evaluations described above are reasonable and currently no other impairment indicators exist for our indefinite-lived assets. However, if future actual results do not meet our expectations, the Company may be required to record an impairment charge, the amount of which could be material to our results of operations. The cost of trademarks, licenses and other intangible assets with finite lives is being amortized by the straight-line method over the term of the respective license or the intangible assets estimated useful life which range from three to twenty years. If the residual value of a finite life intangible asset exceeds its carrying value, then the asset is not amortized. The Company reviews intangible assets with finite lives for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. Product sales of our Karl Lagerfeld brand have not met with our original expectations. During the fourth quarter of 2016, the Company recorded an impairment loss of $5.7 million. Trademarks (finite lives) primarily represent Lanvin brand names and trademarks and in connection with their purchase, Lanvin was granted the right to repurchase the brand names and trademarks in 2025 for the greater of €70 million (approximately $84 million) or one times the average of the annual sales for the years ending December 31, 2023 and 2024 (residual value). Because the residual value of the intangible asset exceeds its carrying value, the asset is not amortized. |
Accrued Expenses
Accrued Expenses | 12 Months Ended |
Dec. 31, 2017 | |
Accrued Expenses | |
Accrued Expenses | (9) Accrued Expenses Accrued expenses consist of the following: December 31, 2017 2016 Advertising liabilities $ 27,418 $ 26,526 Salary (including bonus and related taxes) 18,488 13,085 Royalties 11,409 10,697 Due vendors (not yet invoiced) 11,228 1,496 Retirement reserves 9,113 6,391 Other 4,187 4,414 $ 81,843 $ 62,609 |
Loans Payable - Banks
Loans Payable - Banks | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Loans Payable - Banks | (10) Loans Payable – Banks Loans payable – banks consist of the following: The Company and its domestic subsidiaries have available a $20 million unsecured revolving line of credit due on demand, which bears interest at the daily one-month LIBOR plus 2% (the one-month LIBOR was 1.56% as of December 31, 2017). The line of credit which has a maturity date of December 18, 2018 is expected to be renewed on an annual basis. Borrowings outstanding pursuant to lines of credit were zero as of December 31, 2017 and 2016. The Company’s foreign subsidiaries have available credit lines, including several bank overdraft facilities totaling approximately $30 million. These credit lines bear interest at EURIBOR plus between 0.5% and 0.8% (EURIBOR was minus 0.19% at December 31, 2017). Outstanding amounts were zero as of December 31, 2017 and 2016. The weighted average interest rate on short-term borrowings was zero as of December 31, 2017 and 2016. |
Long-term Debt
Long-term Debt | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Long-term Debt | (11) Long-term Debt In June 2015, the Company financed its Rochas brand acquisition with a $111 million, 5-year term loan payable in equal quarterly installments plus interest. This term loan requires the maintenance of certain financial covenants, tested semi-annually, including a maximum leverage ratio and a minimum interest coverage ratio. The facility also contains new debt restrictions among other standard provisions. The Company is in compliance with all of the covenants and other restrictions of the debt agreements. In order to reduce exposure to rising variable interest rates, the Company entered into a swap transaction effectively exchanging the variable interest rate to a fixed rate of approximately 1.2%. The swap is a derivative instrument and is therefore recorded at fair value and changes in fair value are reflected in the accompanying consolidated statements of income. Maturities of long-term debt subsequent to December 31, 2017 are approximately $21 million per year through 2019 and, $11 million in 2020. |
Commitments
Commitments | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments | (12) Commitments Leases The Company leases its office and warehouse facilities under operating leases which are subject to various step rent provisions, rent concessions and escalation clauses expiring at various dates through 2023. Escalation clauses are not material and have been excluded from minimum future annual rental payments. Rental expense, which is calculated on a straight-line basis, amounted to $11.2 million, $10.7 million and $9.9 million in 2017, 2016 and 2015, respectively. Minimum future annual rental payments are as follows: 2018 $ 5,835 2019 4,565 2020 3,571 2021 3,594 2022 3,020 Thereafter 5,163 $ 25,748 License Agreements The Company is party to a number of license and other agreements for the use of trademarks and rights in connection with the manufacture and sale of its products expiring at various dates through 2032. In connection with certain of these license agreements, the Company is subject to minimum annual advertising commitments, minimum annual royalties and other commitments as follows: 2018 $ 136,345 2019 151,209 2020 160,391 2021 168,161 2022 153,894 Thereafter 1,107,029 $ 1,877,029 Future advertising commitments are estimated based on planned future sales for the license terms that were in effect at December 31, 2017, without consideration for potential renewal periods. The above figures do not reflect the fact that our distributors share our advertising obligations. Royalty expense included in selling, general, and administrative expenses, aggregated $39.6 million, $37.8 million and $33.8 million, in 2017, 2016 and 2015, respectively, and represented 6.7%, 7.3% and 7.2% of net sales for the years ended December 31, 2017, 2016 and 2015, respectively. |
Equity
Equity | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Equity | (13) Equity Share-Based Payments: The Company maintains a stock option program for key employees, executives and directors. The plans, all of which have been approved by shareholder vote, provide for the granting of both nonqualified and incentive options. Options granted under the plans typically have a six-year term and vest over a four to five-year period. The fair value of shares vested aggregated $0.9 million in both 2017 and 2016. Compensation cost, net of estimated forfeitures, is recognized on a straight-line basis over the requisite service period for the entire award. Forfeitures are estimated based on historic trends. It is generally the Company’s policy to issue new shares upon exercise of stock options. The following table sets forth information with respect to nonvested options for 2017: Number of Shares Weighted Average Grant Date Fair Value Nonvested options – beginning of year 401,440 $ 7.14 Nonvested options granted 174,600 $ 9.82 Nonvested options vested or forfeited (144,805 ) $ 7.13 Nonvested options – end of year 431,235 $ 8.22 The effect of share-based payment expenses decreased income statement line items as follows: Year Ended December 31, 2017 2016 2015 Income before income taxes $ 2,100 $ 1,200 $ 800 Net income attributable to Inter Parfums, Inc. 1,150 700 500 Diluted earnings per share attributable to Inter Parfums, Inc. 0.04 0.02 0.01 The following table summarizes stock option activity and related information for the years ended December 31, 2017, 2016 and 2015: Year ended December 31, 2017 2016 2015 Options Weighted Average Exercise Price Options Weighted Average Exercise Price Options Weighted Average Exercise Price Shares under option - beginning of year 684,540 $ 26.94 709,300 $ 24.34 639,495 $ 23.19 Options granted 174,600 43.48 148,950 32.61 158,300 23.79 Options exercised (103,230 ) 19.03 (123,150 ) 18.69 (80,685 ) 13.82 Options forfeited (24,930 ) 29.49 (50,560 ) 27.18 (7,810 ) 27.77 Shares under option - end of year 730,980 31.92 684,540 26.94 709,300 24.34 At December 31, 2017, options for 929,985 shares were available for future grant under the plans. The aggregate intrinsic value of options outstanding is $8.5 million as of December 31, 2017 and unrecognized compensation cost related to stock options outstanding aggregated $3.4 million, which will be recognized over the next five years. The weighted average fair values of options granted by Inter Parfums, Inc. during 2017, 2016 and 2015 were $9.82, $7.43 and $5.99 per share, respectively, on the date of grant using the Black-Scholes option pricing model to calculate the fair value. The assumptions used in the Black-Scholes pricing model are set forth in the following table: Year Ended December 31, 2017 2016 2015 Weighted-average expected stock-price volatility 28 % 29 % 33 % Weighted-average expected option life 5.0 years 5.0 years 5.0 years Weighted-average risk-free interest rate 2.2 % 2.0 % 1.7 % Weighted-average dividend yield 2.0 % 2.1 % 2.1 % Expected volatility is estimated based on historic volatility of the Company’s common stock. The expected term of the option is estimated based on historic data. The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of the grant of the option and the dividend yield reflects the assumption that the dividend payout as authorized by the Board of Directors would maintain its current payout ratio as a percentage of earnings. Proceeds, tax benefits and intrinsic value related to stock options exercised were as follows: Year Ended December 31, 2017 2016 2015 Proceeds from stock options exercised, excluding cashless exercise of $0.7 million and $0.5 million in 2016 and 2015, respectively $ 1,963 $ 1,579 $ 653 Tax benefits $ 600 $ 400 $ 260 Intrinsic value of stock options exercised $ 2,258 $ 1,860 $ 1,137 The following table summarizes additional stock option information as of December 31, 2017: Options outstanding Number weighted average remaining Options Exercise prices outstanding contractual life exercisable $19.33 77,960 1.00 years 77,960 $22.20 2,800 1.08 years 2,000 $23.61 117,540 4.00 years 45,150 $25.29 - $28.82 13,000 2.85 years 5,500 $26.40 4,000 3.08 years 1,000 $27.80 102,600 3.00 years 59,120 $29.36 2,000 1.68 years 1,500 $32.12 - $32.83 137,900 4.93 years 28,955 $33.95 4,000 4.09 years — $35.75 99,580 2.00 years 78,560 $40.15 2,000 4.70 years — $43.80 167,600 6.00 years — Totals 730,980 3.86 years 299,745 As of December 31, 2017, the weighted average exercise price of options exercisable was $27.45 and the weighted average remaining contractual life of options exercisable is 2.51 years. The aggregate intrinsic value of options exercisable at December 31, 2017 is $4.8 million. The Chief Executive Officer and the President each exercised 19,000 outstanding stock options of the Company’s common stock in 2016 and 2015. The aggregate exercise prices of $0.7 million in 2016 and $0.5 million in 2015 were paid by them tendering to the Company in 2016 and 2015 an aggregate of 20,658 and 18,764 shares, of the Company’s common stock, previously owned by them, valued at fair market value on the dates of exercise. All shares issued pursuant to these option exercises were issued from treasury stock of the Company. In addition, the Chief Executive Officer tendered in 2016 and 2015 an additional 2,179 and 1,299 shares, respectively, for payment of certain withholding taxes resulting from his option exercises. In September 2016, Interparfums SA, approved a plan to grant an aggregate of 15,100 shares of its stock to employees with no performance condition requirement, and an aggregate of 133,000 shares to officers and managers, subject to certain corporate performance conditions. The shares, subject to adjustment for stock splits, will be distributed in September 2019 so long as the individual is employed by Interparfums SA at the time, and in the case of officers and managers, only to the extent that the performance conditions have been met. Once distributed, the shares will be unrestricted and the employees will be permitted to trade their shares. The fair value of the grant of $25.00 per share has been determined based on the quoted stock price of Interparfums SA shares as reported by the NYSE Euronext on the date of grant taking into account the dividend yield as no dividends on this grant will be earned until the shares are distributed. The estimated number of shares to be distributed of 137,381, subject to adjustment for stock splits, has been determined taking into account employee turnover. The aggregate cost of the grant, approximately $3.4 million, will be recognized as compensation cost by Interparfums SA on a straight-line basis over the requisite three year service period. The total compensation cost recognized in 2017 and 2016 was $1.2 million and $0.4 million, respectively. To avoid dilution of the Company’s ownership of Interparfums SA, all shares to be distributed pursuant to this plan will be pre-existing shares of Interparfums SA, purchased in the open market by Interparfums SA. In 2016, 108,348 shares were acquired in the open market at an aggregate cost of $2.9 million, and such amount has been classified as an equity transaction on the accompanying balance sheet. Dividends In October 2017, the Board of Directors of the Company authorized a 24% increase in the annual dividend to $0.84 per share. The quarterly dividend aggregating approximately $6.6 million ($0.21 per share) declared in December 2017 was paid in January 2018. The next quarterly dividend of $0.21 per share will be paid on April 13, 2018 to shareholders of record on March 30, 2018. |
Net Income Attributable to Inte
Net Income Attributable to Inter Parfums, Inc. Common Shareholders | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
Net Income Attributable to Inter Parfums, Inc. Common Shareholders | (14) Net Income Attributable to Inter Parfums, Inc. Common Shareholders Net income attributable to Inter Parfums, Inc. per common share (“basic EPS”) is computed by dividing net income attributable to Inter Parfums, Inc. by the weighted average number of shares outstanding. Net income attributable to Inter Parfums, Inc. per share assuming dilution (“diluted EPS”), is computed using the weighted average number of shares outstanding, plus the incremental shares outstanding assuming the exercise of dilutive stock options using the treasury stock method. The reconciliation between the numerators and denominators of the basic and diluted EPS computations is as follows: Year ended December 31, 2017 2016 2015 Numerator for diluted earnings per share $ 41,594 $ 33,331 $ 30,437 Denominator: Weighted average shares 31,172,285 31,072,328 30,996,137 Effect of dilutive securities: Stock options 132,816 103,270 104,078 Denominator for diluted earnings per share 31,305,101 31,175,598 31,100,215 Earnings per share: Net income attributable to Inter Parfums, Inc. common shareholders: Basic $ 1.33 $ 1.07 $ 0.98 Diluted 1.33 1.07 0.98 Not included in the above computations is the effect of anti-dilutive potential common shares, which consist of outstanding options to purchase 165,000, 267,000, and 272,000 shares of common stock for 2017, 2016, and 2015, respectively. |
Segments and Geographic Areas
Segments and Geographic Areas | 12 Months Ended |
Dec. 31, 2017 | |
Segments, Geographical Areas [Abstract] | |
Segments and Geographic Areas | (15) Segments and Geographic Areas The Company manufactures and distributes one product line, fragrances and fragrance related products. The Company manages its business in two segments, European based operations and United States based operations. The European assets are located, and operations are primarily conducted, in France. Both European and United States operations primarily represent the sale of prestige brand name fragrances. Information on the Company’s operations by segments is as follows: Year ended December 31, 2017 2016 2015 Net sales: United States $ 116,244 $ 117,256 $ 105,851 Europe 476,660 404,198 362,911 Eliminations of intercompany sales (1,653 ) (382 ) (222 ) $ 591,251 $ 521,072 $ 468,540 Net income attributable to Inter Parfums, Inc.: United States $ 7,051 $ 8,285 $ 7,640 Europe 34,577 25,120 22,797 Eliminations (34 ) (74 ) — $ 41,594 $ 33,331 $ 30,437 Depreciation and amortization expense including impairment loss: United States $ 3,943 $ 1,816 $ 1,583 Europe 7,971 13,525 7,495 $ 11,914 $ 15,341 $ 9,078 Interest and dividend income: United States $ 58 $ 22 $ 18 Europe 2,925 3,309 2,977 $ 2,983 $ 3,331 $ 2,995 Interest expense: United States $ — $ — $ 2 Europe 1,991 2,340 2,824 $ 1,991 $ 2,340 $ 2,826 Income tax expense: United States $ 3,764 $ 4,278 $ 3,923 Europe 19,069 19,596 17,604 Eliminations (21 ) (48 ) — $ 22,812 $ 23,826 $ 21,527 December 31, 2017 2016 2015 Total assets: United States $ 92,909 $ 89,930 $ 80,761 Europe 694,385 602,077 616,199 Eliminations of investment in subsidiary (9,522 ) (9,598 ) (9,301 ) $ 777,772 $ 682,409 $ 687,659 Additions to long-lived assets: United States $ 980 $ 930 $ 1,283 Europe 3,089 4,812 122,663 $ 4,069 $ 5,742 $ 123,946 Total long-lived assets: United States $ 9,284 $ 12,247 $ 13,133 Europe 201,541 181,697 197,535 $ 210,825 $ 193,944 $ 210,668 Deferred tax assets: United States $ 781 $ 194 $ 365 Europe 8,808 7,848 6,817 Eliminations 69 48 — $ 9,658 $ 8,090 $ 7,182 United States export sales were approximately $71.4 million, $77.5 million and $66.3 million in 2017, 2016 and 2015, respectively. Consolidated net sales to customers by region are as follows: Year ended December 31, 2017 2016 2015 North America $ 176,900 $ 149,000 $ 125,700 Europe 214,800 194,700 170,600 Central and South America 51,200 44,000 41,100 Middle East 50,500 41,600 41,900 Asia 88,000 81,300 78,200 Other 9,900 10,500 11,000 $ 591,300 $ 521,100 $ 468,500 Consolidated net sales to customers in major countries are as follows: Year Ended December 31, 2017 2016 2015 United States $ 173,000 $ 144,000 $ 122,000 United Kingdom $ 33,000 $ 31,000 $ 32,000 France $ 44,000 $ 47,000 $ 34,000 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | (16) Income Taxes The Company or its subsidiaries file income tax returns in the U.S. federal, and various states and foreign jurisdictions. The Company assessed its uncertain tax positions and determined that it has no uncertain tax position at December 31, 2017. The components of income before income taxes consist of the following: Year ended December 31, 2017 2016 2015 U.S. operations $ 10,761 $ 12,441 $ 11,564 Foreign operations 67,304 54,633 48,932 $ 78,065 $ 67,074 $ 60,496 The provision for current and deferred income tax expense (benefit) consists of the following: Year ended December 31, 2017 2016 2015 Current: Federal $ 4,050 $ 3,792 $ 3,660 State and local 302 309 220 Foreign 19,051 21,099 16,806 23,403 25,200 20,686 Deferred: Federal (554 ) 113 30 State and local (55 ) 9 1 Foreign 18 (1,496 ) 810 (591 ) (1,374 ) 841 Total income tax expense $ 22,812 $ 23,826 $ 21,527 The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities are as follows: December 31, 2017 2016 Net deferred tax assets: Foreign net operating loss carry-forwards $ 520 $ 821 Inventory and accounts receivable 1,557 1,875 Profit sharing 4,212 3,187 Stock option compensation 502 864 Effect of inventory profit elimination 3,166 2,888 Other 222 (724 ) Total gross deferred tax assets, net 10,179 8,911 Valuation allowance (520 ) (821 ) Net deferred tax assets 9,659 8,090 Deferred tax liabilities (long-term): Trademarks and licenses (3,821 ) (3,449 ) Other — — Total deferred tax liabilities (3,821 ) (3,449 ) Net deferred tax assets $ 5,838 $ 4,641 Valuation allowances are provided for foreign net operating loss carry-forwards, as future profitable operations from certain foreign subsidiaries might not be sufficient to realize the full amount of net operating loss carry-forwards. No other valuation allowances have been provided as management believes that it is more likely than not that the asset will be realized in the reduction of future taxable income. Tax Cuts and Jobs Act On December 22, 2017, the U.S. government passed the Tax Cuts and Jobs Act (“the Tax Act”). The Tax Act makes broad and complex changes to the U.S. tax code, including, but not limited to: (i) reducing the future U.S. federal corporate tax rate from 35% to 21%; (ii) requiring companies to pay a one-time transition tax on certain unremitted earnings of foreign subsidiaries; and (iii) bonus depreciation that will allow for full expensing of qualified property. The Tax Act also established new tax laws that will affect 2018, including, but not limited to: (i) the reduction of the U.S. federal corporate tax rate discussed above; (ii) a general elimination of U.S. federal income taxes on dividends from foreign subsidiaries; (iii) a new provision designed to tax global intangible low-taxed income (“GILTI”); (iv) the repeal of the domestic production activity deductions; (v) limitations on the deductibility of certain executive compensation; (vi) limitations on the use of foreign tax credits to reduce the U.S. income tax liability; and (vii) a new provision that allows a domestic corporation an immediate deduction for a portion of its foreign derived intangible income (“FDII”). The Securities and Exchange Commission staff issued Staff Accounting Bulletin (“SAB”) 118, which provides guidance on accounting for the tax effects of the Tax Act. SAB 118 provides a measurement period that should not extend beyond one year from the Tax Act enactment date for companies to complete the related accounting under ASC 740, Accounting for Income Taxes. In accordance with SAB 118, a company must reflect the income tax effects of those aspects of the Tax Act for which the accounting under ASC 740 is complete. To the extent that a company’s accounting for a certain income tax effect of the Tax Act is incomplete, but it is able to determine a reasonable estimate, it must record a provisional estimate in the financial statements. If a company cannot determine a provisional estimate to be included in the financial statements, it should continue to apply ASC 740 on the basis of the provisions of the tax laws that were in effect immediately before the enactment of the Tax Act. The Company’s accounting for certain elements of the Tax Act is incomplete. However, the Company was able to make reasonable estimates of the effects and, therefore, recorded provisional estimates for these items. In connection with its initial analysis of the impact of the Tax Act, the Company has recorded a tax expense of $1.1 million for the year ended December 31, 2017. This estimate consists of no expense for the one-time transition tax and an expense of $1.1 million related to revaluation of deferred tax assets and liabilities, caused by the new lower corporate tax rate. To determine the transition tax, the Company must determine the amount of post-1986 accumulated earnings and profits of the relevant subsidiaries, as well as the amount of non-U.S. income taxes paid on such earnings. While the Company was able to make a reasonable estimate of the transition tax, it is continuing to gather additional information to more precisely compute the final amount. Likewise, while the Company was able to make a reasonable estimate of the impact of the reduction to the corporate tax rate, it may be affected by other analyses related to the Tax Act, including, but not limited to, the state tax effect of adjustments made to federal temporary differences. Due to the complexity of the new GILTI tax rules, the Company is continuing to evaluate this provision of the Tax Act and the application of ASC 740. Under GAAP, the Company is allowed to make an accounting policy choice to either: (1) treat taxes due on future U.S. inclusions in taxable income related to GILTI as a current-period expense when incurred (the “period cost method”); or (2) factor in such amounts into a company’s measurement of its deferred taxes (the “deferred method”). The Company’s selection of an accounting policy with respect to the new GILTI tax rules is dependent on additional analysis and potential future modifications to existing structure, which are not currently known. Accordingly, the Company has not made any adjustments related to potential GILTI tax in our financial statements and has not made a policy decision regarding whether to record deferred taxes on GILTI. The Company will continue to analyze the full effects of the Tax Act on its financial statements. The impact of the Tax Act may differ from the current estimate, possibly materially, due to changes in interpretations and assumptions the Company has made, future guidance that may be issued and actions the Company may take as a result of the law. Income Tax Recovery The French government had introduced a 3% tax on dividends or deemed dividends for entities subject to French corporate income tax in 2012. In 2017, the French Constitutional Court released a decision declaring that the 3% tax on dividends or deemed dividends is unconstitutional. As a result of that decision, the Company has filed a claim for refund of approximately $3.6 million (€3.2 million) for these taxes paid since 2015 including accrued interest of approximately $0.4 million. The Company recorded the refund claim in the accompanying financial statements as of December 31, 2017. Settlement with French Tax Authorities As previously reported, the French Tax Authorities examined the 2012 tax return of Interparfums SA. The main issues challenged by the French Tax Authorities related to the commission rate and royalty rate paid to Interparfums Singapore Pte. and Interparfums (Suisse) SARL, respectively. Due to the subjective nature of the issues involved, in April 2016, Interparfums SA reached an agreement in principle to settle the entire matter with the French Tax Authorities. The settlement required Interparfums SA to pay a tax assessment of $1.9 million covering the issues for not only the 2012 tax year, but also covering the issues for the tax years ended 2013 through 2015. The settlement, which was finalized by the French Tax Authorities in the first quarter of 2017, was accrued in March 2016. Other Tax Matters The Company is no longer subject to U.S. federal, state, and local or non-U.S. income tax examinations by tax authorities for years before 2014. Differences between the United States Federal statutory income tax rate and the effective income tax rate were as follows: Year ended December 31, 2017 2016 2015 Statutory rates 34.0 % 34.0 % 34.0 % State and local taxes, net of Federal benefit 0.2 0.3 0.2 Deferred tax effect of statutory tax rate changes 1.4 — — Foreign income tax recovery (4.6 ) — — Effect of foreign taxes greater than (less than) U.S. statutory rates (1.0 ) 1.5 1.6 Other (0.8 ) (0.3 ) (0.2 ) Effective rates 29.2 % 35.5 % 35.6 % |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 12 Months Ended |
Dec. 31, 2017 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Accumulated Other Comprehensive Loss | (17) Accumulated Other Comprehensive Loss The components of accumulated other comprehensive loss consist of the following: Year ended December 31, 2017 2016 2015 Net derivative instruments, beginning of year $ (17 ) $ — $ — Net derivative instrument loss, net of tax 54 (17 ) — Net derivative instruments, end of year 37 (17 ) — Cumulative translation adjustments, beginning of year (57,965 ) (48,091 ) (15,823 ) Translation adjustments 40,096 (9,874 ) (32,268 ) Cumulative translation adjustments, end of year (17,869 ) (57,965 ) (48,091 ) Accumulated other comprehensive loss $ (17,832 ) $ (57,982 ) $ (48,091 ) |
Net Income Attributable to In25
Net Income Attributable to Inter Parfums, Inc. and Transfers from the Noncontrolling Interest | 12 Months Ended |
Dec. 31, 2017 | |
Noncontrolling Interest [Abstract] | |
Net Income Attributable to Inter Parfums, Inc. and Transfers from the Noncontrolling Interest | (18) Net Income Attributable to Inter Parfums, Inc. and Transfers from the Noncontrolling Interest Year ended December 31, 2017 2016 2015 Net income attributable to Inter Parfums, Inc. $ 41,594 $ 33,331 $ 30,437 Decrease in Inter Parfums, Inc.’s additional paid-in capital for subsidiary share transactions — (1,926 ) (192 ) Change from net income attributable to Inter Parfums, Inc. and transfers from noncontrolling interest $ 41,594 $ 31,405 $ 30,245 |
Schedule II - Valuation and Qua
Schedule II - Valuation and Qualifying Accounts | 12 Months Ended |
Dec. 31, 2017 | |
Schedule Ii - Valuation And Qualifying Accounts | |
Schedule II - Valuation and Qualifying Accounts | Schedule II INTER PARFUMS, INC. AND SUBSIDIARIES Valuation and Qualifying Accounts (In thousands) Column A Column B Column C Column D Column E Additions (1) (2) Charged to Balance at Charged to other beginning of costs and accounts – Deductions – Balance at Description period expenses describe describe end of period Allowance for doubtful accounts: Year ended December 31, 2017 $ 2,011 843 205 (d) 1,238 (a) 1,821 Year ended December 31, 2016 $ 1,823 349 (68 ) (d) 93 (a) 2,011 Year ended December 31, 2015 $ 1,609 442 (164 ) (d) 64 (a) 1,823 Sales return accrual: Year ended December 31, 2017 $ 3,332 3,497 — 3,519 (b) 3,310 Year ended December 31, 2016 $ 4,047 3,789 — 4,504 (b) 3,332 Year ended December 31, 2015 $ 5,309 3,490 — 4,752 (b) 4,047 Inventory reserve: Year ended December 31, 2017 $ 5,316 3,300 570 (d) 3,837 (c) 5,349 Year ended December 31, 2016 $ 6,641 5,234 (135 ) (d) 6,424 (c) 5,316 Year ended December 31, 2015 $ 5,970 5,563 (499 ) (d) 4,393 (c) 6,641 (a) Write-off of bad debts. (b) Write-off of sales returns. (c) Disposal of inventory (d) Foreign currency translation adjustment |
The Company and its Significa27
The Company and its Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Business of the Company | Business of the Company Inter Parfums, Inc. and its subsidiaries (the “Company”) are in the fragrance business and manufacture and distribute a wide array of fragrances and fragrance related products. Substantially all of our prestige fragrance brands are licensed from unaffiliated third parties, and our business is dependent upon the continuation and renewal of such licenses. With respect to the Company’s largest brands, we own the Lanvin brand name for our class of trade, and license the Montblanc and Jimmy Choo brand names. As a percentage of net sales, product sales for the Company’s largest brands were as follows: Year Ended December 31, 2017 2016 2015 Montblanc 21 % 23 % 21 % Jimmy Choo 18 % 17 % 20 % Lanvin 11 % 12 % 15 % No other brand represented 10% or more of consolidated net sales. |
Basis of Preparation | Basis of Preparation The consolidated financial statements include the accounts of the Company, including 73% owned Interparfums SA, a subsidiary whose stock is publicly traded in France. In 2015, Interparfums SA formed a subsidiary in Spain, Parfums Rochas. The subsidiary is 51% owned by Interparfums SA with the remaining 49% owned by its Rochas distributor for Spain. The subsidiary is responsible for Rochas brand distribution in the territory. All material intercompany balances and transactions have been eliminated. |
Management Estimates | Management Estimates Management makes assumptions and estimates to prepare financial statements in conformity with accounting principles generally accepted in the United States of America. Those assumptions and estimates directly affect the amounts reported and disclosures included in the consolidated financial statements. Actual results could differ from those assumptions and estimates. Significant estimates for which changes in the near term are considered reasonably possible and that may have a material impact on the financial statements are disclosed in these notes to the consolidated financial statements. |
Foreign Currency Translation | Foreign Currency Translation For foreign subsidiaries with operations denominated in a foreign currency, assets and liabilities are translated to U.S. dollars at year-end exchange rates. Income and expense items are translated at average rates of exchange prevailing during the year. Gains and losses from translation adjustments are accumulated in a separate component of shareholders’ equity. |
Cash and Cash Equivalents and Short-Term Investments | Cash and Cash Equivalents and Short-Term Investments All highly liquid investments purchased with a maturity of three months or less are considered to be cash equivalents. From time to time, the Company has short-term investments which consist of certificates of deposit with maturities greater than three months. The Company monitors concentrations of credit risk associated with financial institutions with which the Company conducts significant business. The Company believes its credit risk is minimal, as the Company primarily conducts business with large, well-established financial institutions. Substantially all cash and cash equivalents are held at financial institutions outside the United States and are readily convertible into U.S. dollars. |
Accounts Receivable | Accounts Receivable Accounts receivable represent payments due to the Company for previously recognized net sales, reduced by allowances for sales returns and doubtful accounts or balances which are estimated to be uncollectible, which aggregated $5.1 million and $5.3 million as of December 31, 2017 and 2016, respectively. Accounts receivable balances are written-off against the allowance for doubtful accounts when they become uncollectible. Recoveries of accounts receivable previously recorded against the allowance are recorded in the consolidated statement of income when received. We generally grant credit based upon our analysis of the customer’s financial position, as well as previously established buying patterns. |
Inventories | Inventories Inventories, including promotional merchandise, only include inventory considered saleable or usable in future periods, and is stated at the lower of cost and net realizable value, with cost being determined on the first-in, first-out method. Cost components include raw materials, direct labor and overhead (e.g., indirect labor, utilities, depreciation, purchasing, receiving, inspection and warehousing) as well as inbound freight. Promotional merchandise is charged to cost of sales at the time the merchandise is shipped to the Company’s customers. |
Derivatives | Derivatives All derivative instruments are recorded as either assets or liabilities and measured at fair value. The Company uses derivative instruments to principally manage a variety of market risks. For derivatives designated as hedges of the exposure to changes in fair value of the recognized asset or liability or a firm commitment (referred to as fair value hedges), the gain or loss is recognized in earnings in the period of change together with the offsetting loss or gain on the hedged item attributable to the risk being hedged. The effect of that accounting is to include in earnings the extent to which the hedge is not effective in achieving offsetting changes in fair value. For cash flow hedges, the effective portion of the derivative’s gain or loss is initially reported in equity (as a component of accumulated other comprehensive income) and is subsequently reclassified into earnings in the same period or periods during which the hedged forecasted transaction affects earnings. The ineffective portion of the gain or loss of a cash flow hedge is reported in earnings immediately. The Company also holds certain instruments for economic purposes that are not designated for hedge accounting treatment. For these derivative instruments, changes in their fair value are recorded in earnings immediately. |
Equipment and Leasehold Improvements | Equipment and Leasehold Improvements Equipment and leasehold improvements are stated at cost less accumulated depreciation and amortization. Depreciation and amortization are provided using the straight-line method over the estimated useful lives for equipment, which range between three and ten years and the shorter of the lease term or estimated useful asset lives for leasehold improvements. Depreciation provided on equipment used to produce inventory, such as tools and molds, is included in cost of sales. |
Long-Lived Assets | Long-Lived Assets Indefinite-lived intangible assets principally consist of trademarks which are not amortized. The Company evaluates indefinite-lived intangible assets for impairment at least annually during the fourth quarter, or more frequently when events occur or circumstances change, such as an unexpected decline in sales, that would more likely than not indicate that the carrying value of an indefinite-lived intangible asset may not be recoverable. When testing indefinite-lived intangible assets for impairment, the evaluation requires a comparison of the estimated fair value of the asset to the carrying value of the asset. The fair values used in our evaluations are estimated based upon discounted future cash flow projections using a weighted average cost of capital of 6.22% in both 2017 and 2016. The cash flow projections are based upon a number of assumptions, including future sales levels, future cost of goods and operating expense levels, as well as economic conditions, changes to our business model or changes in consumer acceptance of our products which are more subjective in nature. If the carrying value of an indefinite-lived intangible asset exceeds its fair value, an impairment charge is recorded. Intangible assets subject to amortization are evaluated for impairment testing whenever events or changes in circumstances indicate that the carrying amount of an amortizable intangible asset may not be recoverable. If impairment indicators exist for an amortizable intangible asset, the undiscounted future cash flows associated with the expected service potential of the asset are compared to the carrying value of the asset. If our projection of undiscounted future cash flows is in excess of the carrying value of the intangible asset, no impairment charge is recorded. If our projection of undiscounted future cash flows is less than the carrying value of the intangible asset, an impairment charge would be recorded to reduce the intangible asset to its fair value. |
Revenue Recognition | Revenue Recognition The Company sells its products to department stores, perfumeries, specialty stores and domestic and international wholesalers and distributors. Sales of such products by our domestic subsidiaries are denominated in U.S. dollars, and sales of such products by our foreign subsidiaries are primarily denominated in either euro or U.S. dollars. The Company recognizes revenues when title, ownership, and risk of loss pass to the customer, all of which occurs upon shipment or delivery of the product and is based on the applicable shipping terms. Net sales are comprised of gross revenues less returns, trade discounts and allowances. The Company does not bill its customers’ freight and handling charges. All shipping and handling costs, which aggregated $5.9 million, $5.1 million and $4.7 million in 2017, 2016 and 2015, respectively, are included in selling, general and administrative expenses in the consolidated statements of income. The Company grants credit to all qualified customers and does not believe it is exposed significantly to any undue concentration of credit risk. No one customer represented 10% or more of net sales in 2017, 2016 or 2015. |
Sales Returns | Sales Returns Generally, the Company does not permit customers to return their unsold products. However, for U.S. based customers, we allow returns if properly requested, authorized and approved. The Company regularly reviews and revises, as deemed necessary, its estimate of reserves for future sales returns based primarily upon historic trends and relevant current data including information provided by retailers regarding their inventory levels. In addition, as necessary, specific accruals may be established for significant future known or anticipated events. The types of known or anticipated events that we consider include, but are not limited to, the financial condition of our customers, store closings by retailers, changes in the retail environment and our decision to continue to support new and existing products. The Company records estimated reserves for sales returns as a reduction of sales, cost of sales and accounts receivable. Returned products are recorded as inventories and are valued based upon estimated realizable value. The physical condition and marketability of returned products are the major factors we consider in estimating realizable value. Actual returns, as well as estimated realizable values of returned products, may differ significantly, either favorably or unfavorably, from our estimates, if factors such as economic conditions, inventory levels or competitive conditions differ from our expectations. |
Payments to Customers | Payments to Customers The Company records revenues generated from purchase with purchase and gift with purchase promotions as sales and the costs of its purchase with purchase and gift with purchase promotions as cost of sales. Certain other incentive arrangements require the payment of a fee to customers based on their attainment of pre-established sales levels. These fees have been recorded as a reduction of net sales. |
Advertising and Promotion | Advertising and Promotion Advertising and promotional costs are expensed as incurred and recorded as a component of cost of goods sold (in the case of free goods given to customers) or selling, general and administrative expenses. Advertising and promotional costs included in selling, general and administrative expenses were $123.7 million, $99.0 million and $83.8 million for 2017, 2016 and 2015, respectively. Costs relating to purchase with purchase and gift with purchase promotions that are reflected in cost of sales aggregated $33.8 million, $30.0 million and $25.4 million in 2017, 2016 and 2015, respectively. |
Package Development Costs | Package Development Costs Package development costs associated with new products and redesigns of existing product packaging are expensed as incurred. |
Operating Leases | Operating Leases The Company recognizes rent expense from operating leases with various step rent provisions, rent concessions and escalation clauses on a straight-line basis over the applicable lease term. The Company considers lease renewals in the useful life of its leasehold improvements when such renewals are reasonably assured. In the event the Company receives capital improvement funding from its landlord, these amounts are recorded as deferred liabilities and amortized over the remaining lease term as a reduction of rent expense. |
License Agreements | License Agreements The Company’s license agreements generally provide the Company with worldwide rights to manufacture, market and sell fragrance and fragrance related products using the licensors’ trademarks. The licenses typically have an initial term of approximately 5 to 15 years, and are potentially renewable subject to the Company’s compliance with the license agreement provisions. The remaining terms, including the potential renewal periods, range from approximately 1 to 15 years. Under each license, the Company is required to pay royalties in the range of 5% to 10% to the licensor, at least annually, based on net sales to third parties. In certain cases, the Company may pay an entry fee to acquire, or enter into, a license where the licensor or another licensee was operating a pre-existing fragrance business. In those cases, the entry fee is capitalized as an intangible asset and amortized over its useful life. Most license agreements require minimum royalty payments, incremental royalties based on net sales levels and minimum spending on advertising and promotional activities. Royalty expenses are accrued in the period in which net sales are recognized while advertising and promotional expenses are accrued at the time these costs are incurred. In addition, the Company is exposed to certain concentration risk. Substantially all of our prestige fragrance brands are licensed from unaffiliated third parties, and our business is dependent upon the continuation and renewal of such licenses. |
Income Taxes | Income Taxes The Company accounts for income taxes using an asset and liability approach that requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in its financial statements or tax returns. The net deferred tax assets assume sufficient future earnings for their realization, as well as the continued application of currently enacted tax rates. Included in net deferred tax assets is a valuation allowance for deferred tax assets, where management believes it is more-likely-than-not that the deferred tax assets will not be realized in the relevant jurisdiction. If the Company determines that a deferred tax asset will not be realizable, an adjustment to the deferred tax asset will result in a reduction of net earnings at that time. Accrued interest and penalties are included within the related tax asset or liability in the accompanying financial statements. |
Issuance of Common Stock by Consolidated Subsidiary | Issuance of Common Stock by Consolidated Subsidiary The difference between the Company’s share of the proceeds received by the subsidiary and the carrying amount of the portion of the Company’s investment deemed sold, is reflected as an equity adjustment in the consolidated balance sheets. |
Treasury Stock | Treasury Stock The Board of Directors may authorize share repurchases of the Company’s common stock (Share Repurchase Authorizations). Share repurchases under Share Repurchase Authorizations may be made through open market transactions, negotiated purchase or otherwise, at times and in such amounts within the parameters authorized by the Board. Shares repurchased under Share Repurchase Authorizations are held in treasury for general corporate purposes, including issuances under various employee stock option plans. Treasury shares are accounted for under the cost method and reported as a reduction of equity. Share Repurchase Authorizations may be suspended, limited or terminated at any time without notice. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In August 2017, the Financial Accounting Standards Board (“FASB”) issued an Accounting Standards Update (“ASU”) to improve accounting for hedging activities. The objective of the ASU is to improve the financial reporting of hedging relationships in order to better portray the economic results of an entity’s risk management activities in its financial statements and to make certain targeted improvements to simplify the application of hedge accounting guidance. This ASU is effective for annual and interim periods beginning after December 15, 2018 and early adoption is permitted. We are currently evaluating the standard to determine the impact of its adoption on our consolidated financial statements. In August 2016, the FASB issued an ASU to eliminate the diversity in practice related to the classification of certain cash receipts and payments in the statement of cash flows, by adding or clarifying guidance on eight specific cash flow issues. This ASU is effective for annual and interim periods beginning after December 15, 2017 and early adoption is permitted. We have evaluated the standard and determined that there will be no material impact on our consolidated financial statements. In February 2016, the FASB issued an ASU which requires lessees to recognize lease assets and lease liabilities arising from operating leases on the balance sheet. This ASU is effective for annual and interim reporting periods beginning after December 15, 2018 using a modified retrospective approach, with early adoption permitted. We are currently evaluating the standard to determine the impact of its adoption on our consolidated financial statements. In November 2015, the FASB issued an ASU that requires all deferred tax liabilities and assets to be classified as noncurrent on the balance sheet. This ASU is effective for annual and interim reporting periods beginning after December 15, 2016. In January 2017, the Company adopted the standard retrospectively, which resulted in reclassifications among accounts on the consolidated balance sheet, but had no other impact on our results of operations, financial condition or cash flows. The effect of the adoption on prior periods was a reclassification from current assets to noncurrent assets of approximately $8 million. In May 2014, the FASB issued an ASU which superseded the most current revenue recognition requirements. This new revenue recognition standard requires entities to recognize revenue in a way that depicts the transfer of goods or services to customers in an amount that reflects the consideration which the entity expects to be entitled to in exchange for those goods or services. The new standard also includes enhanced disclosure requirements. This guidance is effective for annual and interim reporting periods beginning after December 15, 2017, with early adoption permitted for annual periods after December 31, 2016. We have adopted the standard as of December 31, 2017 and determined that other than a modification of our revenue recognition policy, there has been no material impact on our consolidated financial statements. There are no other recent accounting pronouncements issued but not yet adopted that would have a material effect on our consolidated financial statements. |
The Company and its Significa28
The Company and its Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Schedule of lanvin brand name for our class | As a percentage of net sales, product sales for the Company’s largest brands were as follows: Year Ended December 31, 2017 2016 2015 Montblanc 21 % 23 % 21 % Jimmy Choo 18 % 17 % 20 % Lanvin 11 % 12 % 15 % |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Inventory Disclosure [Abstract] | |
Schedule of inventories | December 31, 2017 2016 Raw materials and component parts $ 46,884 $ 36,821 Finished goods 90,174 60,156 $ 137,058 $ 96,977 |
Fair Value of Financial Instr30
Fair Value of Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Schedule of fair value, assets measured on recurring basis | The following tables present our financial assets and liabilities that are measured at fair value on a recurring basis and are categorized using the fair value hierarchy. The fair value hierarchy has three levels based on the reliability of the inputs used to determine fair value. Fair Value Measurements at December 31, 2017 Quoted Prices in Significant Other Significant Active Markets for Observable Unobservable Identical Assets Inputs Inputs Total (Level 1) (Level 2) (Level 3) Assets: Short-term investments $ 69,899 $ — $ 69,899 $ — Foreign currency forward exchange contracts accounted for using hedge accounting 26 26 Foreign currency forward exchange contracts not accounted for using hedge accounting 119 — 119 — $ 70,044 $ — $ 70,044 $ — Liabilities: Interest rate swap $ 529 $ — $ 529 $ — Fair Value Measurements at December 31, 2016 Quoted Prices in Significant Other Significant Active Markets for Observable Unobservable Identical Assets Inputs Inputs Total (Level 1) (Level 2) (Level 3) Assets: Short-term investments $ 94,202 $ — $ 94,202 $ — Liabilities: Foreign currency forward exchange contracts accounted for using hedge accounting $ 181 $ — $ 181 $ — Foreign currency forward exchange contracts not accounted for using hedge accounting 418 — 418 — Interest rate swap 908 — 908 — $ 1,507 $ — $ 1,507 $ — |
Equipment and Leasehold Impro31
Equipment and Leasehold Improvements (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Schedule of equipment and leasehold improvements | December 31, 2017 2016 Equipment $ 37,074 $ 31,325 Leasehold improvements 1,639 1,635 38,713 32,960 Less accumulated depreciation and amortization 28,383 22,884 $ 10,330 $ 10,076 |
Trademarks, Licenses and Othe32
Trademarks, Licenses and Other Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |
Schedule of trademarks, licenses and other intangible assets | 2017 Gross Accumulated Net Book Amount Amortization Value Trademarks (indefinite lives) $ 129,033 $ — $ 129,033 Trademarks (finite lives) 46,461 72 46,389 Licenses (finite lives) 69,439 46,857 22,582 Other intangible assets (finite lives) 14,949 12,458 2,491 Subtotal 130,849 59,387 71,462 Total $ 259,882 $ 59,387 $ 200,495 2016 Gross Accumulated Net Book Amount Amortization Value Trademarks (indefinite lives) $ 115,793 $ — $ 115,793 Trademarks (finite lives) 40,794 63 40,731 Licenses (finite lives) 62,102 37,206 24,896 Other intangible assets (finite lives) 12,861 10,413 2,448 Subtotal 115,757 47,682 68,075 Total $ 231,550 $ 47,682 $ 183,868 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Accrued Expenses Tables | |
Schedule of accrued expenses | Accrued expenses consist of the following: December 31, 2017 2016 Advertising liabilities $ 27,418 $ 26,526 Salary (including bonus and related taxes) 18,488 13,085 Royalties 11,409 10,697 Due vendors (not yet invoiced) 11,228 1,496 Retirement reserves 9,113 6,391 Other 4,187 4,414 $ 81,843 $ 62,609 |
Commitments (Tables)
Commitments (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of minimum future annual rental payments | Minimum future annual rental payments are as follows: 2018 $ 5,835 2019 4,565 2020 3,571 2021 3,594 2022 3,020 Thereafter 5,163 $ 25,748 |
Schedule of minimum annual advertising commitments, annual royalties and other commitments | In connection with certain of these license agreements, the Company is subject to minimum annual advertising commitments, minimum annual royalties and other commitments as follows: 2018 $ 136,345 2019 151,209 2020 160,391 2021 168,161 2022 153,894 Thereafter 1,107,029 $ 1,877,029 |
Equity (Tables)
Equity (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Schedule of nonvested share activity | The following table sets forth information with respect to nonvested options for 2017: Number of Shares Weighted Average Grant Date Fair Value Nonvested options – beginning of year 401,440 $ 7.14 Nonvested options granted 174,600 $ 9.82 Nonvested options vested or forfeited (144,805 ) $ 7.13 Nonvested options – end of year 431,235 $ 8.22 |
Schedule of effect of share-based payment expenses | The effect of share-based payment expenses decreased income statement line items as follows: Year Ended December 31, 2017 2016 2015 Income before income taxes $ 2,100 $ 1,200 $ 800 Net income attributable to Inter Parfums, Inc. 1,150 700 500 Diluted earnings per share attributable to Inter Parfums, Inc. 0.04 0.02 0.01 |
Schedule of stock option activity | The following table summarizes stock option activity and related information for the years ended December 31, 2017, 2016 and 2015: Year ended December 31, 2017 2016 2015 Options Weighted Average Exercise Price Options Weighted Average Exercise Price Options Weighted Average Exercise Price Shares under option - beginning of year 684,540 $ 26.94 709,300 $ 24.34 639,495 $ 23.19 Options granted 174,600 43.48 148,950 32.61 158,300 23.79 Options exercised (103,230 ) 19.03 (123,150 ) 18.69 (80,685 ) 13.82 Options forfeited (24,930 ) 29.49 (50,560 ) 27.18 (7,810 ) 27.77 Shares under option - end of year 730,980 31.92 684,540 26.94 709,300 24.34 |
Schedule of valuation assumptions in Black-Scholes pricing | The assumptions used in the Black-Scholes pricing model are set forth in the following table: Year Ended December 31, 2017 2016 2015 Weighted-average expected stock-price volatility 28 % 29 % 33 % Weighted-average expected option life 5.0 years 5.0 years 5.0 years Weighted-average risk-free interest rate 2.2 % 2.0 % 1.7 % Weighted-average dividend yield 2.0 % 2.1 % 2.1 % |
Schedule of stock options exercised | Proceeds, tax benefits and intrinsic value related to stock options exercised were as follows: Year Ended December 31, 2017 2016 2015 Proceeds from stock options exercised, excluding cashless exercise of $0.7 million and $0.5 million in 2016 and 2015, respectively $ 1,963 $ 1,579 $ 653 Tax benefits $ 600 $ 400 $ 260 Intrinsic value of stock options exercised $ 2,258 $ 1,860 $ 1,137 |
Schedule of additional stock option information | The following table summarizes additional stock option information as of December 31, 2017: Options outstanding Number weighted average remaining Options Exercise prices outstanding contractual life exercisable $19.33 77,960 1.00 years 77,960 $22.20 2,800 1.08 years 2,000 $23.61 117,540 4.00 years 45,150 $25.29 - $28.82 13,000 2.85 years 5,500 $26.40 4,000 3.08 years 1,000 $27.80 102,600 3.00 years 59,120 $29.36 2,000 1.68 years 1,500 $32.12 - $32.83 137,900 4.93 years 28,955 $33.95 4,000 4.09 years — $35.75 99,580 2.00 years 78,560 $40.15 2,000 4.70 years — $43.80 167,600 6.00 years — Totals 730,980 3.86 years 299,745 |
Net Income Attributable to In36
Net Income Attributable to Inter Parfums, Inc. Common Shareholders (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
Schedule of earnings per share, basic and diluted | The reconciliation between the numerators and denominators of the basic and diluted EPS computations is as follows: Year ended December 31, 2017 2016 2015 Numerator for diluted earnings per share $ 41,594 $ 33,331 $ 30,437 Denominator: Weighted average shares 31,172,285 31,072,328 30,996,137 Effect of dilutive securities: Stock options 132,816 103,270 104,078 Denominator for diluted earnings per share 31,305,101 31,175,598 31,100,215 Earnings per share: Net income attributable to Inter Parfums, Inc. common shareholders: Basic $ 1.33 $ 1.07 $ 0.98 Diluted 1.33 1.07 0.98 |
Segments and Geographic Areas (
Segments and Geographic Areas (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Segments, Geographical Areas [Abstract] | |
Schedule of company's operations by segments | Information on the Company’s operations by segments is as follows: Year ended December 31, 2017 2016 2015 Net sales: United States $ 116,244 $ 117,256 $ 105,851 Europe 476,660 404,198 362,911 Eliminations of intercompany sales (1,653 ) (382 ) (222 ) $ 591,251 $ 521,072 $ 468,540 Net income attributable to Inter Parfums, Inc.: United States $ 7,051 $ 8,285 $ 7,640 Europe 34,577 25,120 22,797 Eliminations (34 ) (74 ) — $ 41,594 $ 33,331 $ 30,437 Depreciation and amortization expense including impairment loss: United States $ 3,943 $ 1,816 $ 1,583 Europe 7,971 13,525 7,495 $ 11,914 $ 15,341 $ 9,078 Interest and dividend income: United States $ 58 $ 22 $ 18 Europe 2,925 3,309 2,977 $ 2,983 $ 3,331 $ 2,995 Interest expense: United States $ — $ — $ 2 Europe 1,991 2,340 2,824 $ 1,991 $ 2,340 $ 2,826 Income tax expense: United States $ 3,764 $ 4,278 $ 3,923 Europe 19,069 19,596 17,604 Eliminations (21 ) (48 ) — $ 22,812 $ 23,826 $ 21,527 December 31, 2017 2016 2015 Total assets: United States $ 92,909 $ 89,930 $ 80,761 Europe 694,385 602,077 616,199 Eliminations of investment in subsidiary (9,522 ) (9,598 ) (9,301 ) $ 777,772 $ 682,409 $ 687,659 Additions to long-lived assets: United States $ 980 $ 930 $ 1,283 Europe 3,089 4,812 122,663 $ 4,069 $ 5,742 $ 123,946 Total long-lived assets: United States $ 9,284 $ 12,247 $ 13,133 Europe 201,541 181,697 197,535 $ 210,825 $ 193,944 $ 210,668 Deferred tax assets: United States $ 781 $ 194 $ 365 Europe 8,808 7,848 6,817 Eliminations 69 48 — $ 9,658 $ 8,090 $ 7,182 |
Schedule of consolidated net sales to customers by region | United States export sales were approximately $71.4 million, $77.5 million and $66.3 million in 2017, 2016 and 2015, respectively. Consolidated net sales to customers by region are as follows: Year ended December 31, 2017 2016 2015 North America $ 176,900 $ 149,000 $ 125,700 Europe 214,800 194,700 170,600 Central and South America 51,200 44,000 41,100 Middle East 50,500 41,600 41,900 Asia 88,000 81,300 78,200 Other 9,900 10,500 11,000 $ 591,300 $ 521,100 $ 468,500 |
Schedule of consolidated net sales to customers in major countries | Consolidated net sales to customers in major countries are as follows: Year Ended December 31, 2017 2016 2015 United States $ 173,000 $ 144,000 $ 122,000 United Kingdom $ 33,000 $ 31,000 $ 32,000 France $ 44,000 $ 47,000 $ 34,000 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Schedule of components of income before income taxes | The components of income before income taxes consist of the following: Year ended December 31, 2017 2016 2015 U.S. operations $ 10,761 $ 12,441 $ 11,564 Foreign operations 67,304 54,633 48,932 $ 78,065 $ 67,074 $ 60,496 |
Schedule of provision for current and deferred income tax expense (benefit) | The provision for current and deferred income tax expense (benefit) consists of the following: Year ended December 31, 2017 2016 2015 Current: Federal $ 4,050 $ 3,792 $ 3,660 State and local 302 309 220 Foreign 19,051 21,099 16,806 23,403 25,200 20,686 Deferred: Federal (554 ) 113 30 State and local (55 ) 9 1 Foreign 18 (1,496 ) 810 (591 ) (1,374 ) 841 Total income tax expense $ 22,812 $ 23,826 $ 21,527 |
Schedule of significant portions of the deferred tax assets and deferred tax liabilities | The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities are as follows: December 31, 2017 2016 Net deferred tax assets: Foreign net operating loss carry-forwards $ 520 $ 821 Inventory and accounts receivable 1,557 1,875 Profit sharing 4,212 3,187 Stock option compensation 502 864 Effect of inventory profit elimination 3,166 2,888 Other 222 (724 ) Total gross deferred tax assets, net 10,179 8,911 Valuation allowance (520 ) (821 ) Net deferred tax assets 9,659 8,090 Deferred tax liabilities (long-term): Trademarks and licenses (3,821 ) (3,449 ) Other — — Total deferred tax liabilities (3,821 ) (3,449 ) Net deferred tax assets $ 5,838 $ 4,641 |
Schedule of differences between the united states federal statutory income tax rate and the effective income tax rate | Differences between the United States Federal statutory income tax rate and the effective income tax rate were as follows: Year ended December 31, 2017 2016 2015 Statutory rates 34.0 % 34.0 % 34.0 % State and local taxes, net of Federal benefit 0.2 0.3 0.2 Deferred tax effect of statutory tax rate changes 1.4 — — Foreign income tax recovery (4.6 ) — — Effect of foreign taxes greater than (less than) U.S. statutory rates (1.0 ) 1.5 1.6 Other (0.8 ) (0.3 ) (0.2 ) Effective rates 29.2 % 35.5 % 35.6 % |
Accumulated Other Comprehensi39
Accumulated Other Comprehensive Loss (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Schedule of components of accumulated other comprehensive loss | The components of accumulated other comprehensive loss consist of the following: Year ended December 31, 2017 2016 2015 Net derivative instruments, beginning of year $ (17 ) $ — $ — Net derivative instrument loss, net of tax 54 (17 ) — Net derivative instruments, end of year 37 (17 ) — Cumulative translation adjustments, beginning of year (57,965 ) (48,091 ) (15,823 ) Translation adjustments 40,096 (9,874 ) (32,268 ) Cumulative translation adjustments, end of year (17,869 ) (57,965 ) (48,091 ) Accumulated other comprehensive loss $ (17,832 ) $ (57,982 ) $ (48,091 ) |
Net Income Attributable to In40
Net Income Attributable to Inter Parfums, Inc. and Transfers from the Noncontrolling Interest (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Noncontrolling Interest [Abstract] | |
Schedule of net income attributable to transfers from the noncontrolling interest | Year ended December 31, 2017 2016 2015 Net income attributable to Inter Parfums, Inc. $ 41,594 $ 33,331 $ 30,437 Decrease in Inter Parfums, Inc.’s additional paid-in capital for subsidiary share transactions — (1,926 ) (192 ) Change from net income attributable to Inter Parfums, Inc. and transfers from noncontrolling interest $ 41,594 $ 31,405 $ 30,245 |
The Company and its Significa41
The Company and its Significant Accounting Policies (Details) - Sales Revenue, Net [Member] | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Concentration Risk [Line Items] | |||
Percentage | 10.00% | 10.00% | 10.00% |
Montblanc [Member] | |||
Concentration Risk [Line Items] | |||
Percentage | 21.00% | 23.00% | 21.00% |
Jimmy Choo [Member] | |||
Concentration Risk [Line Items] | |||
Percentage | 18.00% | 17.00% | 20.00% |
Lanvin [Member] | |||
Concentration Risk [Line Items] | |||
Percentage | 11.00% | 12.00% | 15.00% |
The Company and its Significa42
The Company and its Significant Accounting Policies (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Allowances for sales returns and doubtful accounts | $ 5,100 | $ 5,300 | |
Shipping and handling costs | 5,900 | 5,100 | $ 4,700 |
Advertising costs | 123,700 | 99,000 | 83,800 |
Customer incentives cost | $ 33,800 | $ 30,000 | $ 25,400 |
Weighted average cost of capital | 6.22% | ||
Royalty expense, percentage of net sales | 6.70% | 7.30% | 7.20% |
Prior period reclassification adjustment from current to noncurrent assets | $ 8,000 | ||
Interparfum SA [Member] | |||
Ownership percentage in Interparfums SA | 73.00% | 51.00% | |
Parfums Rochas [Member] | |||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 49.00% | ||
Minimum [Member] | |||
License agreement term | 5 years | ||
License agreement renewal term | 1 year | ||
Royalty expense, percentage of net sales | 5.00% | ||
Maximum [Member] | |||
License agreement term | 15 years | ||
License agreement renewal term | 15 years | ||
Royalty expense, percentage of net sales | 10.00% | ||
Sales Revenue, Net [Member] | |||
Concentration Risk, Percentage | 10.00% | 10.00% | 10.00% |
Buyout of License (Details Narr
Buyout of License (Details Narrative) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Proceeds from Sale of Intangible Assets | $ 5,700 | $ 5,886 | ||
Gain (Loss) on Disposition of Intangible Assets | $ 4,700 | $ 4,652 |
Recent Agreements (Details Narr
Recent Agreements (Details Narrative) | 1 Months Ended | ||
Feb. 28, 2018 | May 31, 2017 | Sep. 30, 2016 | |
Paul Smith [Member] | |||
Business Acquisition [Line Items] | |||
Renewal Of License Agreement Term Years | 4 years | ||
S.T. Dupont [Member] | |||
Business Acquisition [Line Items] | |||
Renewal Of License Agreement Term Years | 3 years | ||
Subsequent Event [Member] | Guess [Member] | |||
Business Acquisition [Line Items] | |||
License Agreement Term | 15 years |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Inventory Disclosure [Abstract] | ||
Raw materials and component parts | $ 46,884 | $ 36,821 |
Finished goods | 90,174 | 60,156 |
Inventories | $ 137,058 | $ 96,977 |
Inventories (Details Narrative)
Inventories (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Inventory Disclosure [Abstract] | ||
Cost of Goods Sold, Overhead | $ 5,000 | $ 3,100 |
Inventory Valuation Reserves | $ 5,400 | $ 5,400 |
Fair Value of Financial Instr47
Fair Value of Financial Instruments (Details) - Fair Value, Measurements, Recurring [Member] - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Assets: | ||
Short-term investments | $ 69,899 | $ 94,202 |
Foreign currency forward exchange contracts accounted for using hedge accounting | 26 | |
Foreign currency forward exchange contracts not accounted for using hedge accounting | 119 | |
Total Assets | 70,044 | |
Liabilities: | ||
Foreign currency forward exchange contracts accounted for using hedge accounting | 181 | |
Foreign currency forward exchange contracts not accounted for using hedge accounting | 418 | |
Interest rate swap | 529 | 908 |
Total Liabilities | 529 | 1,507 |
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ||
Assets: | ||
Short-term investments | ||
Foreign currency forward exchange contracts not accounted for using hedge accounting | ||
Total Assets | ||
Liabilities: | ||
Foreign currency forward exchange contracts accounted for using hedge accounting | ||
Foreign currency forward exchange contracts not accounted for using hedge accounting | ||
Interest rate swap | ||
Total Liabilities | ||
Significant Other Observable Inputs (Level 2) [Member] | ||
Assets: | ||
Short-term investments | 69,899 | 94,202 |
Foreign currency forward exchange contracts accounted for using hedge accounting | 26 | |
Foreign currency forward exchange contracts not accounted for using hedge accounting | 119 | |
Total Assets | 70,044 | |
Liabilities: | ||
Foreign currency forward exchange contracts accounted for using hedge accounting | 181 | |
Foreign currency forward exchange contracts not accounted for using hedge accounting | 418 | |
Interest rate swap | 529 | 908 |
Total Liabilities | 529 | 1,507 |
Significant Unobservable Inputs (Level 3) [Member] | ||
Assets: | ||
Short-term investments | ||
Foreign currency forward exchange contracts not accounted for using hedge accounting | ||
Total Assets | ||
Liabilities: | ||
Foreign currency forward exchange contracts accounted for using hedge accounting | ||
Foreign currency forward exchange contracts not accounted for using hedge accounting | ||
Interest rate swap | ||
Total Liabilities |
Derivative Financial Instrume48
Derivative Financial Instruments (Details Narrative) ¥ in Thousands, £ in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2017JPY (¥) | Dec. 31, 2017GBP (£) | |
Foreign exchange contracts [Member] | ||||
Derivative [Line Items] | ||||
Foreign currency contracts | $ 10,100 | |||
Foreign exchange contracts [Member] | GBP [Member] | ||||
Derivative [Line Items] | ||||
Foreign currency contracts | £ | £ 8,000 | |||
Foreign exchange contracts [Member] | Japan, Yen | ||||
Derivative [Line Items] | ||||
Foreign currency contracts | ¥ | ¥ 18,000 | |||
Foreign exchange contracts [Member] | Maximum [Member] | ||||
Derivative [Line Items] | ||||
Maturity period | 1 year | |||
Interest Rate Swap [Member] | ||||
Derivative [Line Items] | ||||
Derivative, gain (loss) on derivative, net, total | $ 500 | $ 100 | ||
Rochas Brand [Member] | Trademarks [Member] | Medium-term Notes [Member] | ||||
Derivative [Line Items] | ||||
Cash paid for acquisition and financed by loan, amount | $ 108,000 | |||
Cash paid for acquisition and financed by loan, term | 5 years | |||
Rochas Brand [Member] | Trademarks [Member] | Medium-term Notes [Member] | Foreign exchange contracts [Member] | ||||
Derivative [Line Items] | ||||
Notional amount | $ 108,000 | |||
Exchange rate (in dollars per euro) | 1.067 | 1.067 | 1.067 |
Equipment and Leasehold Impro49
Equipment and Leasehold Improvements (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Property, Plant and Equipment [Line Items] | ||
Equipment and leasehold improvements | $ 38,713 | $ 32,960 |
Less accumulated depreciation and amortization | 28,383 | 22,884 |
Property, Plant and Equipment, Net, Total | 10,330 | 10,076 |
Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Equipment and leasehold improvements | 37,074 | 31,325 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Equipment and leasehold improvements | $ 1,639 | $ 1,635 |
Equipment and Leasehold Impro50
Equipment and Leasehold Improvements (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation, Depletion and Amortization, Total | $ 3,800 | $ 3,700 | $ 3,300 |
Trademarks, Licenses and Othe51
Trademarks, Licenses and Other Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | $ 130,849 | $ 115,757 |
Accumulated Amortization | 59,387 | 47,682 |
Net Book Value | 71,462 | 68,075 |
Total Gross Amount | 259,882 | 231,550 |
Total Accumulated Amortization | 59,387 | 47,682 |
Total Net Book Value | 200,495 | 183,868 |
Licensing Agreements [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | 69,439 | 62,102 |
Accumulated Amortization | 46,857 | 37,206 |
Net Book Value | 22,582 | 24,896 |
Other Intangible Assets [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | 14,949 | 12,861 |
Accumulated Amortization | 12,458 | 10,413 |
Net Book Value | 2,491 | 2,448 |
Indefinite-lived Intangible Assets [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | 129,033 | 115,793 |
Accumulated Amortization | ||
Net Book Value | 129,033 | 115,793 |
Finite-Lived Intangible Assets [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | 46,461 | 40,794 |
Accumulated Amortization | 72 | 63 |
Net Book Value | $ 46,389 | $ 40,731 |
Trademarks, Licenses and Othe52
Trademarks, Licenses and Other Intangible Assets (Details narrative) € in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2017EUR (€) | |
Licensing Agreements LineI tems [Line Items] | ||||
Amortization expense | $ 6,000 | $ 5,900 | $ 5,800 | |
Future amortization expense: | ||||
Finite-Lived Intangible Assets, Amortization Expense, Next Twelve Months | 6,100 | |||
Finite-Lived Intangible Assets, Amortization Expense, Year Two | 3,900 | |||
Finite-Lived Intangible Assets, Amortization Expense, Year Three | 3,400 | |||
Finite-Lived Intangible Assets, Amortization Expense, Year Four | 2,800 | |||
Finite-Lived Intangible Assets, Amortization Expense, after Year Five | $ 2,800 | |||
Amortization period | 14 years | |||
Weighted average cost of capital | 6.22% | |||
Repurchase price | $ 84,000 | |||
Impairment of Intangible Assets, Finite-lived | $ 2,123 | $ 5,658 | ||
Percentage of impairment loss on total intangible assets | 50.00% | |||
Euro [Member] | ||||
Future amortization expense: | ||||
Repurchase price | € | € 70,000 | |||
Maximum [Member] | ||||
Future amortization expense: | ||||
Amortization period | 20 years | |||
Minimum [Member] | ||||
Future amortization expense: | ||||
Amortization period | 3 years | |||
Trademarks [Member] | ||||
Future amortization expense: | ||||
Amortization period | 18 years | |||
Licenses [Member] | ||||
Future amortization expense: | ||||
Amortization period | 14 years | |||
Other Intangible Assets [Member] | ||||
Future amortization expense: | ||||
Amortization period | 2 years |
Accrued Expenses (Details)
Accrued Expenses (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Payables and Accruals [Abstract] | ||
Advertising liabilities | $ 27,418 | $ 26,526 |
Salary (including bonus and related taxes) | 18,488 | 13,085 |
Royalties | 11,409 | 10,697 |
Due vendors (not yet invoiced) | 11,228 | 1,496 |
Retirement reserves | 9,113 | 6,391 |
Other | 4,187 | 4,414 |
Accrued expenses | $ 81,843 | $ 62,609 |
Loans Payable - Banks (Details
Loans Payable - Banks (Details Narrative) $ in Thousands | 12 Months Ended |
Dec. 31, 2017USD ($) | |
Foreign Subsidiaries [Member] | |
Line of Credit Facility [Line Items] | |
Line of credit, maximum borrowing amount | $ 30,000 |
Foreign Subsidiaries [Member] | Euro Interbank Offered Rate [Member] | |
Line of Credit Facility [Line Items] | |
Variable rate | 0.19% |
Foreign Subsidiaries [Member] | Euro Interbank Offered Rate [Member] | Minimum [Member] | |
Line of Credit Facility [Line Items] | |
Basis spread over variable interest rate | 0.50% |
Foreign Subsidiaries [Member] | Euro Interbank Offered Rate [Member] | Maximum [Member] | |
Line of Credit Facility [Line Items] | |
Basis spread over variable interest rate | 0.80% |
Parent and Domestic Subsidiaries [Member] | |
Line of Credit Facility [Line Items] | |
Line of credit, maximum borrowing amount | $ 20,000 |
Maturity | Dec. 18, 2018 |
Parent and Domestic Subsidiaries [Member] | London Interbank Offered Rate (LIBOR) [Member] | |
Line of Credit Facility [Line Items] | |
Basis spread over variable interest rate | 2.00% |
Variable rate | 1.56% |
Long-term Debt (Details Narrati
Long-term Debt (Details Narrative) - USD ($) $ in Thousands | 1 Months Ended | |
Jun. 30, 2015 | Dec. 31, 2017 | |
Debt Instrument [Line Items] | ||
Long-term Debt, Maturities, 2017 | $ 21,000 | |
Long-term Debt, Maturities, 2018 | 21,000 | |
Long-term Debt, Maturities, 2019 | 21,000 | |
Long-term Debt, Maturities, 2020 | $ 11,000 | |
Term Loan [Member] | ||
Debt Instrument [Line Items] | ||
Debt Instrument, Face Amount | $ 111,000 | |
Debt Instrument, Term | 5 years | |
Debt Instrument, Interest Rate During Period | 1.20% |
Commitments (Details)
Commitments (Details) $ in Thousands | Dec. 31, 2017USD ($) |
Minimum future annual rental payments: | |
2,018 | $ 5,835 |
2,019 | 4,565 |
2,020 | 3,571 |
2,021 | 3,594 |
2,022 | 3,020 |
Thereafter | 5,163 |
Total | $ 25,748 |
Commitments (Details 1)
Commitments (Details 1) $ in Thousands | Dec. 31, 2017USD ($) |
Future minimum annual commitments: | |
2,018 | $ 136,345 |
2,019 | 151,209 |
2,020 | 160,391 |
2,021 | 168,161 |
2,022 | 153,894 |
Thereafter | 1,107,029 |
Total | $ 1,877,029 |
Commitments (Details Narrative)
Commitments (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |||
Rent Expense | $ 11,200 | $ 10,700 | $ 9,900 |
Royalty expense, percentage of net sales | 6.70% | 7.30% | 7.20% |
Royalty Expense | $ 39,600 | $ 37,800 | $ 33,800 |
Equity (Details)
Equity (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Nonvested Options, Number of Shares | |||
Beginning of year | 401,440 | ||
Options granted | 174,600 | 148,950 | 158,300 |
Vested or forfeited | (144,805) | ||
End of year | 431,235 | 401,440 | |
Weighted Average Grant Date Fair Value | |||
Beginning of year | $ 7.14 | ||
Granted | 9.82 | ||
Vested or forfeited | 7.13 | ||
End of year | $ 8.22 | $ 7.14 |
Equity (Details 1)
Equity (Details 1) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Income before income taxes | $ 78,065 | $ 67,074 | $ 60,496 |
Net income attributable to Inter Parfums, Inc. | $ 41,594 | $ 33,331 | $ 30,437 |
Diluted earnings per share attributable to Inter Parfums, Inc. | $ 1.33 | $ 1.07 | $ 0.98 |
Operating Income (Loss) [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Income before income taxes | $ 2,100 | $ 1,200 | $ 800 |
Net income attributable to Inter Parfums, Inc. | $ 1,150 | $ 700 | $ 500 |
Diluted earnings per share attributable to Inter Parfums, Inc. | $ 0.04 | $ 0.02 | $ 0.01 |
Equity (Details 2)
Equity (Details 2) - $ / shares | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Shares | |||
Shares under option - beginning of year | 684,540 | 709,300 | 639,495 |
Options granted | 174,600 | 148,950 | 158,300 |
Options exercised | (103,230) | (123,150) | (80,685) |
Options forfeited | (24,930) | (50,560) | (7,810) |
Shares under option - end of year | 730,980 | 684,540 | 709,300 |
Weighted Average Exercise Price | |||
Shares under option - beginning of year | $ 26.94 | $ 24.34 | $ 23.19 |
Options granted | 43.48 | 32.61 | 23.79 |
Options exercised | 19.03 | 18.69 | 13.82 |
Options forfeited | 29.49 | 27.18 | 27.77 |
Shares under option - end of year | $ 31.92 | $ 26.94 | $ 24.34 |
Equity (Details 3)
Equity (Details 3) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Equity [Abstract] | |||
Weighted-average expected stock-price volatility | 28.00% | 29.00% | 33.00% |
Weighted-average expected option life | 5 years | 5 years | 5 years |
Weighted-average risk-free interest rate | 2.20% | 2.00% | 1.70% |
Weighted-average dividend yield | 2.00% | 2.10% | 2.10% |
Equity (Details 4)
Equity (Details 4) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Equity [Abstract] | |||
Proceeds from stock options exercised, excluding cashless exercise of $0.7 million and $0.5 million 2016 and 2015, respectively | $ 1,963 | $ 1,579 | $ 653 |
Tax benefits | 600 | 400 | 260 |
Intrinsic value of stock options exercised | $ 2,258 | $ 1,860 | $ 1,137 |
Equity (Details 5)
Equity (Details 5) | 12 Months Ended |
Dec. 31, 2017$ / sharesshares | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Number outstanding | 730,980 |
Options outstanding weighted average remaining contractual life | 3 years 10 months 10 days |
Options exercisable | 299,745 |
Exercise Price Range One [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Number outstanding | 77,960 |
Options outstanding weighted average remaining contractual life | 1 year |
Options exercisable | 77,960 |
Exercise price range, minimum | $ / shares | $ 19.33 |
Exercise Price Range Two [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Number outstanding | 2,800 |
Options outstanding weighted average remaining contractual life | 1 year 29 days |
Options exercisable | 2,000 |
Exercise price range, minimum | $ / shares | $ 22.20 |
Exercise Price Range Three [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Number outstanding | 117,540 |
Options outstanding weighted average remaining contractual life | 4 years |
Options exercisable | 45,150 |
Exercise price range, minimum | $ / shares | $ 23.61 |
Exercise Price Range Four [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Number outstanding | 13,000 |
Options outstanding weighted average remaining contractual life | 2 years 10 months 6 days |
Options exercisable | 5,500 |
Exercise price range, minimum | $ / shares | $ 25.29 |
Exercise price range, maximum | $ / shares | $ 28.82 |
Exercise Price Range Five [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Number outstanding | 4,000 |
Options outstanding weighted average remaining contractual life | 3 years 29 days |
Options exercisable | 1,000 |
Exercise price range, minimum | $ / shares | $ 26.40 |
Exercise Price Range Six [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Number outstanding | 102,600 |
Options outstanding weighted average remaining contractual life | 3 years |
Options exercisable | 59,120 |
Exercise price range, minimum | $ / shares | $ 27.80 |
Exercise Price Range Seven [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Number outstanding | 2,000 |
Options outstanding weighted average remaining contractual life | 1 year 8 months 5 days |
Options exercisable | 1,500 |
Exercise price range, minimum | $ / shares | $ 29.36 |
Exercise Price Range Eight [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Number outstanding | 137,900 |
Options outstanding weighted average remaining contractual life | 4 years 11 months 5 days |
Options exercisable | 28,955 |
Exercise price range, minimum | $ / shares | $ 32.12 |
Exercise price range, maximum | $ / shares | $ 32.83 |
Exercise Price Range Nine [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Number outstanding | 4,000 |
Options outstanding weighted average remaining contractual life | 4 years 1 month 2 days |
Options exercisable | |
Exercise price range, minimum | $ / shares | $ 33.95 |
Exercise Price Range Ten [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Number outstanding | 99,580 |
Options outstanding weighted average remaining contractual life | 2 years |
Options exercisable | 78,560 |
Exercise price range, minimum | $ / shares | $ 35.75 |
Exercise Price Range Eleven [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Number outstanding | 2,000 |
Options outstanding weighted average remaining contractual life | 4 years 8 months 12 days |
Options exercisable | |
Exercise price range, minimum | $ / shares | $ 40.15 |
Exercise Price Range Twelve [Member] | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Number outstanding | 167,600 |
Options outstanding weighted average remaining contractual life | 6 years |
Options exercisable | |
Exercise price range, minimum | $ / shares | $ 43.80 |
Equity (Details Narrative)
Equity (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||
Oct. 31, 2017 | Sep. 30, 2016 | Mar. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Weighted average grant date fair value | $ 9.82 | |||||
Shares issued upon exercise of stock options, shares | 103,230 | 123,150 | 80,685 | |||
Exercises, aggregate exercise prices | $ 2,258 | $ 1,860 | $ 1,137 | |||
Dividends Payable | $ 6,600 | |||||
Dividends Payable, Amount Per Share | $ 0.84 | $ 0.21 | ||||
Percentage of Increase in Annual Dividend | 24.00% | |||||
Common Stock, Dividends, Per Share, Declared | $ 0.21 | $ 0.72 | $ 0.62 | $ 0.52 | ||
Subsequent Event [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Dividends Payable, Amount Per Share | $ 0.21 | |||||
Dividends Payable, Date to be Paid | Apr. 13, 2018 | |||||
Dividends Payable, Date of Record | Mar. 30, 2018 | |||||
Interparfums SA Subsidiary [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Weighted average grant date fair value | $ 25 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 137,381 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost | $ 3,400 | |||||
Allocated Share-based Compensation Expense | $ 1,200 | $ 400 | ||||
Share based Compensation Arrangement by Share based Payment Award Value Shares Purchased for Award | $ 2,900 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Shares Purchased for Award | 108,348 | |||||
Chief Executive Officer [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares issued upon exercise of stock options, shares | 19,000 | 19,000 | ||||
Exercises, aggregate exercise prices | $ 700 | $ 500 | ||||
Shares Paid For Stock Options Exercised | 20,658 | 18,764 | ||||
Shares tendered for tax withholding | 2,179 | 1,299 | ||||
Officers And Managers [Member] | Interparfums SA Subsidiary [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 133,000 | |||||
Employees [Member] | Interparfums SA Subsidiary [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 15,100 | |||||
Equity Option [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Fair value of shares vested | $ 900 | $ 900 | ||||
Number of shares available for grant | 929,985 | |||||
Aggregate intrinsic value of options outstanding | $ 8,500 | |||||
Unrecognized compensation cost related to stock options | $ 3,400 | |||||
Term | 6 years | |||||
Unrecognized compensation cost, recognition period | 5 years | |||||
Weighted average grant date fair value | $ 9.82 | $ 7.43 | $ 5.99 | |||
Options exercisable, weighted average exercise price | $ 27.45 | |||||
Weighted average remaining contractual life of options outstanding, options exercisable | 2 years 6 months 4 days | |||||
Aggregate intrinsic value of exercisable options | $ 4,800 | |||||
Equity Option [Member] | Minimum [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 4 years | |||||
Equity Option [Member] | Maximum [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 5 years |
Net Income Attributable to In66
Net Income Attributable to Inter Parfums, Inc. Common Shareholders (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Numerator: | |||
Numerator for diluted earnings per share | $ 41,594 | $ 33,331 | $ 30,437 |
Denominator: | |||
Weighted average shares (in shares) | 31,172,285 | 31,072,328 | 30,996,137 |
Effect of dilutive securities: | |||
Stock options (in shares) | 132,816 | 103,270 | 104,078 |
Denominator for diluted earnings per share (in shares) | 31,305,101 | 31,175,598 | 31,100,215 |
Net income attributable to Inter Parfums, Inc. common shareholders: | |||
Basic (in dollar per share) | $ 1.33 | $ 1.07 | $ 0.98 |
Diluted (in dollar per share) | $ 1.33 | $ 1.07 | $ 0.98 |
Net Income Attributable to In67
Net Income Attributable to Inter Parfums, Inc. Common Shareholders (Details Narrative) - shares | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Earnings Per Share [Abstract] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 165,000 | 267,000 | 272,000 |
Segments and Geographic Areas68
Segments and Geographic Areas (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Segment Reporting Information [Line Items] | |||
Net sales | $ 591,251 | $ 521,072 | $ 468,540 |
Net income attributable to Inter Parfums, Inc. | 41,594 | 33,331 | 30,437 |
Depreciation and amortization expense including impairment loss | 11,914 | 15,341 | 9,078 |
Interest and dividend income | 2,983 | 3,331 | 2,995 |
Interest expense | 1,992 | 2,340 | 2,826 |
Income tax expense | 22,812 | 23,826 | 21,527 |
Total assets | 777,772 | 682,409 | 687,659 |
Additions to long-lived assets | 4,069 | 5,742 | 123,946 |
Total long-lived assets | 210,825 | 193,944 | 210,668 |
Deferred tax assets | 9,658 | 8,090 | 7,182 |
Eliminations [Member] | |||
Segment Reporting Information [Line Items] | |||
Net sales | (1,653) | (382) | (222) |
Net income attributable to Inter Parfums, Inc. | (34) | (74) | |
Income tax expense | (21) | (48) | |
Total assets | (9,522) | (9,598) | (9,301) |
Total long-lived assets | |||
Deferred tax assets | 69 | 48 | |
United States [Member] | |||
Segment Reporting Information [Line Items] | |||
Net sales | 116,244 | 117,256 | 105,851 |
Net income attributable to Inter Parfums, Inc. | 7,051 | 8,285 | 7,640 |
Depreciation and amortization expense including impairment loss | 3,943 | 1,816 | 1,583 |
Interest and dividend income | 58 | 22 | 18 |
Interest expense | 2 | ||
Income tax expense | 3,764 | 4,278 | 3,923 |
Total assets | 92,909 | 89,930 | 80,761 |
Additions to long-lived assets | 980 | 930 | 1,283 |
Total long-lived assets | 9,284 | 12,247 | 13,133 |
Deferred tax assets | 781 | 194 | 365 |
Europe [Member] | |||
Segment Reporting Information [Line Items] | |||
Net sales | 476,660 | 404,198 | 362,911 |
Net income attributable to Inter Parfums, Inc. | 34,577 | 25,120 | 22,797 |
Depreciation and amortization expense including impairment loss | 7,971 | 13,525 | 7,495 |
Interest and dividend income | 2,925 | 3,309 | 2,977 |
Interest expense | 1,991 | 2,340 | 2,824 |
Income tax expense | 19,069 | 19,596 | 17,604 |
Total assets | 694,385 | 602,077 | 616,199 |
Additions to long-lived assets | 3,089 | 4,812 | 122,663 |
Total long-lived assets | 201,541 | 181,697 | 197,535 |
Deferred tax assets | $ 8,808 | $ 7,848 | $ 6,817 |
Segments and Geographic Areas69
Segments and Geographic Areas (Details 1) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Net sales | $ 591,300 | $ 521,100 | $ 468,500 |
North America [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Net sales | 176,900 | 149,000 | 125,700 |
European Union [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Net sales | 214,800 | 194,700 | 170,600 |
Middle East [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Net sales | 50,500 | 41,600 | 41,900 |
Asia [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Net sales | 88,000 | 81,300 | 78,200 |
Segment Geographical Groups Of Countries Group Six [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Net sales | 9,900 | 10,500 | 11,000 |
Central and South America [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Net sales | $ 51,200 | $ 44,000 | $ 41,100 |
Segments and Geographic Areas70
Segments and Geographic Areas (Details 2) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
United States [Member] | |||
Revenue, Major Customer [Line Items] | |||
Net sales | $ 173,000 | $ 144,000 | $ 122,000 |
United Kingdom [Member] | |||
Revenue, Major Customer [Line Items] | |||
Net sales | 33,000 | 31,000 | 32,000 |
France [Member] | |||
Revenue, Major Customer [Line Items] | |||
Net sales | $ 44,000 | $ 47,000 | $ 34,000 |
Segments and Geographic Areas71
Segments and Geographic Areas (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Segments, Geographical Areas [Abstract] | |||
Export Sales | $ 71,400 | $ 77,500 | $ 66,300 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |||
U.S. operations | $ 10,761 | $ 12,441 | $ 11,564 |
Foreign operations | 67,304 | 54,633 | 48,932 |
Income before income taxes | $ 78,065 | $ 67,074 | $ 60,496 |
Income Taxes (Details 1)
Income Taxes (Details 1) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Current: | |||
Federal | $ 4,050 | $ 3,792 | $ 3,660 |
State and local | 302 | 309 | 220 |
Foreign | 19,051 | 21,099 | 16,806 |
Current income tax expense | 23,403 | 25,200 | 20,686 |
Deferred: | |||
Federal | (554) | 113 | 30 |
State and local | (55) | 9 | 1 |
Foreign | 18 | (1,496) | 810 |
Deferred income tax (benefit) | (591) | (1,374) | 841 |
Total income tax expense | $ 22,812 | $ 23,826 | $ 21,527 |
Income Taxes (Details 2)
Income Taxes (Details 2) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Net deferred tax assets: | ||
Foreign net operating loss carry-forwards | $ 520 | $ 821 |
Inventory and accounts receivable | 1,557 | 1,875 |
Profit sharing | 4,212 | 3,187 |
Stock option compensation | 502 | 864 |
Effect of inventory profit elimination | 3,166 | 2,888 |
Other | 222 | (724) |
Total gross deferred tax assets, net | 10,179 | 8,911 |
Valuation allowance | (520) | (821) |
Net deferred tax assets | 9,659 | 8,090 |
Deferred tax liabilities (long-term): | ||
Trademarks and licenses | (3,821) | (3,449) |
Other | ||
Total deferred tax liabilities | (3,821) | (3,449) |
Net deferred tax assets | $ 5,838 | $ 4,641 |
Income Taxes (Details 3)
Income Taxes (Details 3) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |||
Statutory rates | 34.00% | 34.00% | 34.00% |
State and local taxes, net of Federal benefit | 0.20% | 0.30% | 0.20% |
Deferred tax effect of statutory tax rate changes | 1.40% | ||
Foreign income tax recovery | (4.60%) | ||
Effect of foreign taxes greater than (less than) U.S. statutory rates | (1.00%) | 1.50% | 1.60% |
Other | (0.80%) | (0.30%) | (0.20%) |
Effective rates | 29.20% | 35.50% | 35.60% |
Income Taxes (Details Narrative
Income Taxes (Details Narrative) € in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015 | Dec. 31, 2017EUR (€) | |
Operating Loss Carryforwards [Line Items] | ||||
Accrued Income Taxes, Current | $ 1,722 | $ 3,331 | ||
Federal income tax rate | 34.00% | 34.00% | 34.00% | |
Revised income tax rate | 21.00% | |||
Estimated income tax expences revaluation of deferred tax assets and liabilities | $ 1,100 | |||
French Tax Authorities [Member] | ||||
Operating Loss Carryforwards [Line Items] | ||||
Percentage of deemed dividends | 3.00% | |||
Income tax refund | $ 3,600 | |||
Accrued interest on income tax | 400 | |||
French Tax Authorities [Member] | Euro [Member] | ||||
Operating Loss Carryforwards [Line Items] | ||||
Income tax refund | € | € 3,200 | |||
Interparfum SA [Member] | ||||
Operating Loss Carryforwards [Line Items] | ||||
Accrued Income Taxes, Current | $ 1,900 |
Accumulated Other Comprehensi77
Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Beginning of year | $ (57,982) | ||
End of year | (17,832) | $ (57,982) | |
Accumulated Translation Adjustment [Member] | |||
Beginning of year | (57,965) | (48,091) | $ (15,823) |
Net derivative instrument loss, net of tax | |||
Translation adjustments | 40,096 | (9,874) | (32,268) |
End of year | (17,869) | (57,965) | (48,091) |
Accumulated Defined Benefit Plans Net Derivative Instruments [Member] | |||
Beginning of year | (17) | ||
Net derivative instrument loss, net of tax | 54 | (17) | |
Translation adjustments | |||
End of year | $ 37 | $ (17) |
Net Income Attributable to In78
Net Income Attributable to Inter Parfums, Inc. and Transfers from the Noncontrolling Interest (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Noncontrolling Interest [Abstract] | |||
Net income attributable to Inter Parfums, Inc. | $ 41,594 | $ 33,331 | $ 30,437 |
Decrease in Inter Parfums, Inc.'s additional paid-in capital for subsidiary share transactions | (1,926) | (192) | |
Change from net income attributable to Inter Parfums, Inc. and transfers from noncontrolling interest | $ 41,594 | $ 31,405 | $ 30,245 |
Schedule II - Valuation and Q79
Schedule II - Valuation and Qualifying Accounts (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | ||
Allowance for Doubtful Accounts [Member] | ||||
Valuation and Qualifying Accounts Disclosure [Line Items] | ||||
Balance at beginning of period | $ 2,011 | $ 1,823 | $ 1,609 | |
Charged to costs and expenses | 843 | 349 | 442 | |
Charged to other accounts - describe | [1] | 205 | (68) | (164) |
Deductions | [2] | 1,238 | 93 | 64 |
Balance at end of period | 1,821 | 2,011 | 1,823 | |
Allowance for Sales Returns [Member] | ||||
Valuation and Qualifying Accounts Disclosure [Line Items] | ||||
Balance at beginning of period | 3,332 | 4,047 | 5,309 | |
Charged to costs and expenses | 3,497 | 3,789 | 3,490 | |
Charged to other accounts - describe | ||||
Deductions | [3] | 3,519 | 4,504 | 4,752 |
Balance at end of period | 3,310 | 3,332 | 4,047 | |
Inventory Valuation Reserve [Member] | ||||
Valuation and Qualifying Accounts Disclosure [Line Items] | ||||
Balance at beginning of period | 5,316 | 6,641 | 5,970 | |
Charged to costs and expenses | 3,300 | 5,234 | 5,563 | |
Charged to other accounts - describe | [1] | 570 | (135) | (499) |
Deductions | [4] | 3,837 | 6,424 | 4,393 |
Balance at end of period | $ 5,349 | $ 5,316 | $ 6,641 | |
[1] | Foreign currency translation adjustment | |||
[2] | Write-off of bad debts. | |||
[3] | Write-off of sales returns. | |||
[4] | Disposal of inventory |