Parlux turnover down although department store sales look strong
The Florida-based company’s preliminary results showed the first quarter suffered from a 36 percent decrease in international sales to $10.2m.
However, domestic department store sales continued to profit from the company’s new sales strategy reaching $8.4m, and increase of 53 percent.
Targeting department stores
The strategy involves employing people to work in department stores to directly promote Parlux’ brands to consumers and was introduced late last year.
Overall, Parlux sales are estimated to be at $23.6m for the quarter, a one percent increase on last year.
“Sales in the quarter were negatively affected by the global economic climate,” affirmed Parlux CEO Neil Katz.
“Our total sales were less than anticipated, essentially due to lower than expected international sales.”
New introducts for next quarter
Nevertheless, Katz said the domestic department store result bodes well for the company’s future and mentioned new introductions in the July to September period which are hoped to have a positive effect on sales.
As these results are only preliminary no details on margins and profits were given; however, Katz said reduced outgoings should help the overall quarterly performance.
“Reduced spending and staffing are anticipated to result in a substantially reduced loss for the quarter compared to the prior year quarter,” he said.
Earlier this year the company announced an unusual partnership with a number of celebrities whose income would be tied to not only the success of the products but also company performance in general.
Deals with Rihanna, Kanye West and Jay Z were announced in April and a pending deal with an unnamed female singer was discussed.
Regarding this last partnerhips Katz said: “As for the fourth celebrity and the delay in finalizing the agreement, we have learned that she is currently involved in negotiating a much larger transaction outside of the fragrance industry, which has taken precedence for her.”
“If successful, we believe this would provide additional exposure and be beneficial to us,” he added.
