Forward Looking Information
Statements in this report which are not historical in nature are forward-looking
statements. Although we believe that our plans, intentions and expectations
reflected in such forward-looking statements are reasonable, we can give no
assurance that such plans, intentions or expectations will be achieved. In some
cases you can identify forward-looking statements by forward-looking words such
as "anticipate," "believe," "could," "estimate," "expect," "intend," "may,"
"should," "will" and "would" or similar words. You should not rely on
forward-looking statements because actual events or results may differ
materially from those indicated by these forward-looking statements as a result
of a number of important factors. These factors include, but are not limited to,
the risks and uncertainties discussed under the headings "Forward Looking
Statements" and "Risk Factors" in Inter Parfums' annual report on Form 10-K for
the fiscal year ended December 31, 2020 and the reports Inter Parfums files from
time to time with the Securities and Exchange Commission. Inter Parfums does not
intend to and undertakes no duty to update the information contained in this
report.
Overview
We operate in the fragrance business, and manufacture, market and distribute a
wide array of fragrances and fragrance related products. We manage our business
in two segments, European based operations and United States based operations.
Certain prestige fragrance products are produced and marketed by our European
operations through our 73% owned subsidiary in Paris, Interparfums SA, which is
also a publicly traded company as 27% of Interparfums SA shares trade on the
NYSE Euronext.
We produce and distribute our European based fragrance products primarily under
license agreements with brand owners, and European based fragrance product sales
represented approximately 80% and 79% of net sales for the three months ended
March 31, 2021 and 2020, respectively. We have built a portfolio of prestige
brands, which include Boucheron, Coach, Jimmy Choo, Karl Lagerfeld, Kate Spade
New York, Lanvin, Moncler, Montblanc, Paul Smith, Repetto, Rochas, S.T. Dupont
and Van Cleef & Arpels, whose products are distributed in over 120 countries
around the world.
Through our United States operations, we also market fragrance and fragrance
related products. United States operations represented 20% and 21% of net sales
for the three months ended March 31, 2021 and 2020, respectively. These
fragrance products are sold primarily pursuant to license or other agreements
with the owners of the Abercrombie & Fitch, Anna Sui, bebe, Dunhill, French
Connection, Graff, GUESS, Hollister, MCM and Oscar de la Renta brands.
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INTER PARFUMS, INC. AND SUBSIDIARIES
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
license the Montblanc, Jimmy Choo, Coach and GUESS brand names. As a percentage
of net sales, product sales for the Company's largest brands were as follows:
Three Months Ended
March 31,
2021 2020
Montblanc. 20 % 21 %
Jimmy Choo. 18 % 15 %
Coach. 16 % 20 %
GUESS. 10 % 11 %
Quarterly sales fluctuations are influenced by the timing of new product
launches as well as the third and fourth quarter holiday season. In certain
markets where we sell directly to retailers, seasonality is more evident. We
sell directly to retailers in France as well as through our own distribution
subsidiaries in Spain and the United States.
We grow our business in two distinct ways. First, we grow by adding new brands
to our portfolio, either through new licenses or other arrangements or out-right
acquisitions of brands. Second, we grow through the introduction of new products
and by supporting new and established products through advertising,
merchandising and sampling as well as phasing out underperforming products so we
can devote greater resources to those products with greater potential. The
economics of developing, producing, launching and supporting products influence
our sales and operating performance each year. Our introduction of new products
may have some cannibalizing effect on sales of existing products, which we take
into account in our business planning.
Our business is not capital intensive, and it is important to note that we do
not own manufacturing facilities. We act as a general contractor and source our
needed components from our suppliers. These components are received at one of
our distribution centers and then, based upon production needs, the components
are sent to one of several third party fillers, which manufacture the finished
product for us and then deliver them to one of our distribution centers.
As with any global business, many aspects of our operations are subject to
influences outside our control. We believe we have a strong brand portfolio with
global reach and potential. As part of our strategy, we plan to continue to make
investments behind fast-growing markets and channels to grow market share.
Our reported net sales are impacted by changes in foreign currency exchange
rates. A strong U.S. dollar has a negative impact on our net sales. However,
earnings are positively affected by a strong dollar, because almost 50% of net
sales of our European operations are denominated in U.S. dollars, while almost
all costs of our European operations are incurred in euro. Conversely, a weak
U.S. dollar has a favorable impact on our net sales while gross margins are
negatively affected. We address certain financial exposures through a controlled
program of risk management that includes the use of derivative financial
instruments and primarily enter into foreign currency forward exchange contracts
to reduce the effects of fluctuating foreign currency exchange rates.
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INTER PARFUMS, INC. AND SUBSIDIARIES
Impact of COVID-19 Pandemic
A novel strain of coronavirus ("COVID-19") surfaced in late 2019 and has spread
around the world, including to the United States and France. In March 2020, the
World Health Organization declared COVID-19 a pandemic. The COVID-19 pandemic
disrupted our business operations and caused a significant unfavorable impact on
our results of operations in 2020.
In response to the COVID-19 pandemic various national, state, and local
governments where we, our suppliers, and our customers operate initially issued
decrees prohibiting certain businesses from continuing to operate and certain
classes of workers from reporting to work. In all jurisdictions in which we
operate we have been following guidance from authorities and health officials in
allowing our teams to gradually return to our offices, including, requiring
personnel to wear masks and implementing additional cleaning and sanitization
routines at our offices and distribution centers.
The effects of the COVID-19 pandemic on the beauty industry began in early March
2020. Retail store closings, event cancellations and a shutdown of international
air travel brought our sales to a virtual standstill. Beginning in June 2020,
retail stores in many jurisdictions around the world began reopening and
business has improved considerably. However, international travel has remained
largely curtailed globally due to both government restrictions and consumer
health concerns.
Business significantly improved during the second half of 2020 and into the
first quarter of 2021 as retail stores reopened and consumers increased their
on-line purchasing, and we expect this trend to continue. However, the recent
resurgence and introduction of variants of COVID-19 cases in various parts of
the world has caused the temporary re-implementation of government restrictions
to prevent further spread of the virus in certain jurisdictions. Therefore,
despite recent business improvement, the impact of the COVID-19 pandemic may
have a material adverse effect on our results of our operations, financial
position and cash flows through at least the end of 2021.
Operationally, we are prepared for increased demand in the post-COVID-19
environment, with business in most parts of the world showing signs of a
comeback. We have geared up to rapidly fill the distribution channels as the
crisis subsides. In that regard, we have maintained reasonable inventory levels
of components and finished goods, and we are gaining local market intelligence
from our distributors and production capacity data from our suppliers.
Recent Important Events
Building Acquisition - Future Headquarters in Paris
In April 2021, our majority owned Paris-based subsidiary, Interparfums SA,
completed the acquisition of its future headquarters at 10 rue de Solférino in
the 7th arrondissement of Paris from the property developer, Apsys. This is an
office complex combining three buildings connected by two inner courtyards, a
large part of which was the French Socialist Party's former headquarters, which
consists of approximately 40,000 total sq. ft.
The €125 million (approximately $149 million) purchase price for this building,
is in line with market values, includes the complete renovation of the site and
is financed by a 10-year €120 million (approximately $143 million) bank loan to
take advantage of low current interest rates.
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INTER PARFUMS, INC. AND SUBSIDIARIES
Anna Sui Corp.In January 2021, we renewed our license agreement with Anna Sui Corp. for the
creation, development and distribution of fragrance products through
December 31, 2026, without any material changes in terms and conditions. Our
initial 10-year license agreement with Anna Sui Corp. was signed in 2011. The
renewal agreement also allows for an additional 5-year term through 2031 at the
option of the Company.
Origines-Parfums
In June 2020, the Company through its 73% owned subsidiary, Interparfums SA, and
Divabox SAS ("Divabox"), owner of the Origines-parfums e-commerce platform for
beauty products, signed a strategic agreement and equity investment pursuant to
which we acquired 25% of Divabox capital for $14.0 million, through a capital
increase. In connection with the acquisition, the Company entered into a $13.4
million term loan, which has been amended such that the loan was repaid in full
in February 2021. As a website of reference for all selective fragrance brands,
Origines-parfums is a key French player in the online beauty market recognized
for its customer relationship expertise. This agreement should enhance the
introduction of dedicated fragrance lines and products designed to address a
specific consumer demand for this distribution channel and accelerate our
digital development.
Moncler
In June 2020, the Company entered into an exclusive, 5-year worldwide license
agreement with a potential 5-year extension with Moncler for the creation,
development and distribution of fragrances under the Moncler brand. Our rights
under this license are subject to certain minimum advertising expenditures and
royalty payments as are customary in our industry. Moncler was founded at
Monestier-de-Clermont, Grenoble, France, in 1952 and is currently headquartered
in Italy. Over the years, the brand has combined style with constant
technological research assisted by experts in activities linked to the world of
the mountain. The Moncler outerwear collections marry the extreme demands of
nature with those of city life. Our first fragrance launch for the Moncler brand
is scheduled for the first quarter of 2022.
Discussion of Critical Accounting Policies
Information regarding our critical accounting policies can be found in our 2020
Annual Report on Form 10-K filed with the SEC.
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INTER PARFUMS, INC. AND SUBSIDIARIES
Results of Operations
Three Months Ended March 31, 2021 as Compared to the Three Months Ended March
31, 2020
Net Sales
Three months ended
March 31,
(in millions) 2021 % Change 2020
European based product sales $ 159.7 40.0 % $ 114.1
United States based product sales 38.8 26.2 % 30.7
Total net sales $ 198.5 37.1 % $ 144.8Net sales for the three months ended March 31, 2021 increased 37.1% to $198.5
million, as compared to $144.8 million for the corresponding period of the prior
year. At comparable foreign currency exchange rates, net sales increased 32.7%.
For the 2021 first quarter, the average U.S. dollar/euro exchange rate was 1.20
as compared to 1.10 in the first quarter of 2020.
European based product sales increased 40.0% to $159.7 million for the three
months ended March 31, 2021, as compared to $114.1 million for the corresponding
period of the prior year. At comparable foreign currency exchange rates, net
sales increased 34.5%.
Continuing the rebound that began in the second half of 2020, sales for the
first three months of 2021 set a first quarter record. Not only were 2021 first
quarter sales 37.1% ahead of the 2020 first quarter, but they were also 11.4%
ahead of the 2019 first quarter sales of $178.2 million. Product sales for our
largest brands within European operations, Montblanc, Jimmy Choo, Coach, and
Lanvin, rose 27.5%, 66.7%, 8.8% and 91.2%, respectively. Montblanc legacy scents
were responsible for the increase in brand sales, and the same holds for Lanvin
fragrances with a major sales boost in the brand's major markets, Eastern Europe
and Asia. In 2021, the increase in Coach sales was more of a function of a
weaker dollar rather than increased sales volume; in 2020 comparable quarter
sales rose 35.9% over the 2019 first quarter due in great part to the
pre-pandemic launch of Coach Dreams. The combination of the strong sales by
established Jimmy Choo scents along with the first quarter launch of I Want Choo
produced the gain in first quarter brand sales. Initial sales of Kate Spade New
York, our first new fragrance for the brand, also pushed first quarter sales to
a new record as did the launch of our eco-friendly scent, Rochas Girl.
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INTER PARFUMS, INC. AND SUBSIDIARIES
United States based product sales increased 26.2% to $38.8 million for the three
months ended March 31, 2021, as compared to $30.7 million for the corresponding
period of the prior year. With little exception, our U.S. brands also produced
strong growth in the first quarter. GUESS, our largest brand, continued to
benefit from a combination of legacy fragrance sales and initial distribution of
Bella Vita. We have had strong replenishment orders for the Authentic Night duo
by Abercrombie & Fitch which debuted late last year while first quarter
shipments of the Canyon Escape duo drove Hollister brand sales growth. Debuting
in limited distribution toward the end of the first quarter was our MCM
signature scent, our first scent for this brand, with global rollout now
underway. The first quarter decline in Anna Sui brand sales following the 62.3%
increase in the 2020 fourth quarter, was primarily due to the launch of Skyin
the 2020 fourth quarter. The limited duty free/travel retail market also
factored into the decline in Anna Sui brand sales. However, we have significant
Anna Sui open orders and look forward to improving brand sales as the year
unfolds. Our newest Oscar de la Renta scent, Alibi, was unveiled late in the
first quarter with broader distribution now in process.
Net Sales to Customers by Region
Three months ended
March 31,
(in millions) 2021 2020
North America $ 72.6 $ 46.5
Western Europe 45.2 41.4
Asia 30.1 22.5
Middle East 18.9 14.4
Eastern Europe 15.9 7.1
Central and South America 13.3 10.9
Other 2.5 2.0
$ 198.5 $ 144.8Most regions showed gains, with sales by two of our three largest markets, North
America and Asia, up 56% and 34%, respectively. The 9% reported sales increase
in Western Europe was attributable to the weaker dollar, as the region was
impacted by the lockdowns in the United Kingdom, Germany and Italy. Comparable
quarter sales also bounced back in the Middle East, Eastern Europe and Central
and South America, growing 31%, 125% and 22%, respectively.
Gross Profit Margin
Three months ended
March 31,
(in millions) 2021 2020
Net sales $ 198.5 $ 144.8
Cost of sales 73.3 55.8
Gross margin $ 125.2 $ 89.0Gross margin as a % of net sales 63.1 % 61.5 %
Gross profit margin was 63.1% of net sales for the three months ended March 31,
2021, as compared to 61.5% for the corresponding period of the prior year. For
European operations, gross profit margin was 65.5% and 63.9% in the first
quarters of 2021 and 2020, respectively. We carefully monitor movements in
foreign currency exchange rates as almost 50% of our European based operations
net sales are denominated in U.S. dollars, while most of our costs are incurred
in euro. From a margin standpoint, a strong U.S. dollar has a positive effect on
our gross profit margin while a weak U.S. dollar has a negative effect. For the
three months ended March 31, 2021 the weaker dollar, as compared to the
corresponding period of the prior year had a negative effect on gross margin.
However, significantly reduced lower margin giftset sales in 2021 and new
product launches with better margins mitigated the negative effect from currency
exchange rates in the period.
For U.S. operations, gross profit margin was 53.2% and 52.6% in the first
quarters of 2021 and 2020, respectively. With the increase in sales in the first
quarter of 2021, we were better able to absorb expenses such as depreciation of
tools and molds and the cost of point-of-sale materials, as compared to the
corresponding period of the prior year.
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INTER PARFUMS, INC. AND SUBSIDIARIES
Generally, we do not bill customers for shipping and handling costs and such
costs, which aggregated $1.7 million and $1.6 million for the three months ended
March 31, 2021 and 2020, respectively, and are included in selling, general and
administrative expenses in the consolidated statements of income. As such, our
Company's gross profit may not be comparable to other companies which may
include these expenses as a component of cost of goods sold.
Selling, General and Administrative Expenses
Three months ended
March 31,
(in millions) 2021 2020
Selling, general and administrative expenses $ 74.9 $ 71.3
Selling, general and administrative expenses as a % of net sales 37.7 % 49.2 %
Selling, general and administrative expenses increased 5.1% for the three months
ended March 31, 2021, as compared to the corresponding period of the prior year.
As a percentage of sales, selling, general and administrative expenses were
37.7% and 49.2% for the three months ended March 31, 2021 and 2020,
respectively. For European operations, with sales up 40.0%, selling, general and
administrative expenses increased 3.9% in 2021, as compared to 2020 and
represented 37.2% of sales in 2021, as compared to 50.1% of sales in 2020. For
U.S. operations, with sales up 26.2%, selling, general and administrative
expenses increased 9.9% in 2021 as compared to 2020 and represented 39.9% and
45.8% of sales in 2021 and 2020, respectively. The decline in selling, general
and administrative expenses as a percentage of sales for the 2021 period was
primarily due to lower promotional and advertising expenses. Sales rebounded
more quickly than anticipated, and we did not have the opportunity to reinvest
in additional promotion and advertising to match our historic levels. Promotion
and advertising included in selling, general and administrative expenses
aggregated approximately $21.8 million (11.0% of net sales) for the 2021 period,
as compared to $28.5 million (19.7% of net sales) for the 2020 period.
As the COVID-19 pandemic recedes, we plan to invest heavily in promotional
spending to support new product launches and to build brand awareness. We have
significant promotion and advertising programs planned for 2021 and expect
promotion and advertising expense included in selling general and administrative
expense to aggregate approximately 21% of sales for the full year ended December
31, 2021.
Royalty expense included in selling, general and administrative expenses
aggregated $15.4 million for the 2021 period, as compared to $11.3 million in
2020 and represented 7.7% and 7.8% of net sales in 2021 and 2020, respectively.
As a result of the above analysis regarding sales, margins and selling, general
and administrative expenses, income from operations increased 169.7% to $48.0
million for the three months ended March 31, 2021, as compared to $17.8 million
for the corresponding period of the prior year. Operating margins were 24.2% of
net sales in the current period as compared to 12.3% for the corresponding
period of the prior year.
Other Income and Expense
Interest expense aggregated $0.4 million and $1.0 million for the three months
ended March 31, 2021 and 2020, respectively. Interest expense is primarily
related to the financing of brand and licensing acquisitions. We use the credit
lines available to us, as needed, to finance our working capital needs as well
as our financing needs for acquisitions.
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INTER PARFUMS, INC. AND SUBSIDIARIES
Foreign currency gains aggregated $1.9 million and $1.0 million for the three
months ended March 31, 2021 and 2020, respectively. We typically enter into
foreign currency forward exchange contracts to manage exposure related to
receivables from unaffiliated third parties denominated in a foreign currency
and occasionally to manage risks related to future sales expected to be
denominated in a foreign currency. Almost 50% of net sales of our European
operations are denominated in U.S. dollars.
Interest income aggregated $0.4 million and $1.0 million for the three months
ended March 31, 2021 and 2020, respectively. Cash and cash equivalents and
short-term investments are primarily invested in certificates of deposit with
varying maturities.
Income Taxes
Our effective tax rate was 26.8% and 29.0% for the three months ended March 31,
2021 and 2020, respectively. Pursuant to an action plan released by the French
Prime Minister, the French corporate income tax rate is to be cut from 33% to
25% over the three-year period ending 2023. Our effective tax rate for European
operations was 28% and 30% for the three months ended March 31, 2021 and 2020,
respectively.
Our effective tax rate for U.S. operations was 17.0% for the three months ended
March 31, 2021, as compared to 20.9% for the corresponding period of the prior
year. Our effective tax rate differs from the 21% statutory rate due to benefits
received from the exercise of stock options as well as deductions we are allowed
for a portion of our foreign derived intangible income slightly offset by state
and local taxes. The benefit from the exercise of stock options for the three
months ended March 31, 2021 was $0.2 million as compared to zero in the 2020
first quarter.
The French authorities are considering that the existence of IP Suisse, a
wholly-owned subsidiary of Interparfums SA, does not, in and of itself,
constitute a permanent establishment and therefore Interparfums, SA should pay
French taxes on all or part of the profits of that entity. The French Tax
Authority notified the Company that IP Suisse will be the subject of a tax audit
covering the period January 1, 2010 through December 31, 2018. No claim or
assessment for any taxes or penalties has been made at this time. The Company
disagrees and is prepared to vigorously defend its position. Consequently, no
provision has been made in the accompanying consolidated financial statements as
we believe it is more likely than not that our position will be sustained based
on its technical merits. Although we believe that we have sufficient arguments
to support our position, there exists a risk that the French authorities may
prevail. The Company's exposure in connection with this matter is approximately
$5.8 million, net of recovery taxes already paid to the Swiss authorities and
excluding interest.
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INTER PARFUMS, INC. AND SUBSIDIARIES
Other than as discussed above, we did not experience any significant changes in
tax rates, and none were expected in jurisdictions where we operate.
Three months ended
Net Income and Earnings per Share March 31,
(in thousands except per share data) 2021 2020
Net income attributable to European operations $ 32,439 $ 11,693
Net income attributable to United States operations 4,187 1,606
Net income 36,626 13,299
Less: Net income attributable to the noncontrolling interest 8,964 3,240
Net income attributable to Inter Parfums, Inc. $ 27,662 $ 10,059
Net income attributable to Inter Parfums, Inc. common
shareholders:
Basic
$ 0.87 $ 0.32
Diluted $ 0.87 $ 0.32
Weighted average number of shares outstanding:
Basic 31,631 31,530
Diluted 31,772 31,708
Net income increased 175.4% to $36.6 million for the three months ended March
31, 2021, as compared to $13.3 million for the corresponding period of the prior
year. The reasons for significant fluctuations in net income for both European
operations and United States operations are directly related to the previous
discussions relating to changes in sales, gross margin, and selling, general and
administrative expenses and effective tax rates.
The noncontrolling interest arises primarily from our 73% owned subsidiary in
Paris, Interparfums SA, which is also a publicly traded company as 27% of
Interparfums SA shares trade on the NYSE Euronext. The noncontrolling interest
is also affected by the profitability of Interparfums SA's 51% owned
distribution subsidiaries in Spain. Net income attributable to the
noncontrolling interest aggregated 28% of European operations net income for
both the three months ended March 31, 2021 and 2020. Net income attributable to
Inter Parfums, Inc. increased 175.0% to $27.7 million, as compared to $10.1
million for the corresponding period of the prior year.
Liquidity and Capital Resources
Our conservative financial tradition has enabled us to amass hefty cash balances
and nominal long-term debt. As of March 31, 2021 we had $294 million in cash,
cash equivalents and short-term investments, most of which is held in euro by
our European operations and is readily convertible into U.S. dollars. We have
not had any liquidity issues to date, and do not expect any liquidity issues
relating to such cash and cash equivalents and short-term investments held by
our European operations. As of March 31, 2021 long-term debt aggregated only
$9.2 million and we also have $49 million available in untapped credit
facilities.
As of March 31, 2021, working capital aggregated $462 million and we had a
working capital ratio in excess of 4 to 1. Approximately 86% of the Company's
total assets are held by European operations, and approximately $179 million of
trademarks, licenses and other intangible assets are held by European
operations.
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INTER PARFUMS, INC. AND SUBSIDIARIES
The Company hopes to benefit from its strong financial position to potentially
acquire one or more brands, either on a proprietary basis or as a licensee.
Opportunities for external growth continue to be examined, with the priority of
maintaining the quality and homogeneous nature of our portfolio. However, we
cannot assure you that any new license or acquisition agreements will be
consummated.
Cash provided by operating activities aggregated $32.5 million for the three
month period ended March 31, 2021, as compared to cash used in operating
activities of $25.1 million for the three months ended March 31, 2020. For the
2021 period, working capital items used $12.9 million in cash from operating
activities, as compared to $40.6 million in the 2020 period. Although accounts
receivable is up 26% from year end, the balance is reasonable based on first
quarter 2021 record sales levels and reflects strong collection activity as
day's sales outstanding is down to 71 for the 2021 period as compared to 85 days
for the corresponding period of the prior year. Inventory levels are down 3%
from year end and includes inventory anticipated to be needed to support 2021
new product launches.
Cash flows used in investing activities in 2021 reflect the purchases of
short-term investments. These investments are primarily certificates of deposit
and other contracts with maturities greater than three months. At March 31,
2021, approximately $82 million of such certificates of deposit contain
penalties where we would forfeit a portion of the interest earned in the event
of early withdrawal.
Our business is not capital intensive as we do not own any manufacturing
facilities. On a full year basis, we expect to spend approximately $4.0 million
on tools and molds, depending on our new product development calendar. Capital
expenditures also include amounts for office fixtures, computer equipment and
industrial equipment needed at our distribution centers.
In April 2021, our majority owned Paris-based subsidiary, Interparfums SA,
completed the acquisition of its future headquarters at 10 rue de Solférino in
the 7th arrondissement of Paris from the property developer, Apsys. This is an
office complex combining three buildings connected by two inner courtyards,
which consists of approximately 40,000 total sq. ft. The €125 million
(approximately $149 million) purchase price for this building, is in line with
market values, includes the complete renovation of the site and is financed by a
10-year €120 million (approximately $143 million) bank loan to take advantage of
low current interest rates.
In June 2020, the Company and Divabox, owner of the Origines-parfums e-commerce
platform for beauty products, signed a strategic agreement and equity investment
pursuant to which we acquired 25% of Divabox capital for $14 million through a
capital increase. In connection with the acquisition, the Company entered into a
$13.4 million term loan, which was repaid in full in February 2021.
Effective January 1, 2021, we entered into a new license agreement modifying our
Rochas fashion business model. The new agreement calls for a reduction in
royalties to be received. As a result, we have taken $2.4 million impairment
charge on our Rochas fashion trademark. The remaining value of the Rochas
fashion trademarks is €17.1 million (approximately $20.0 million). The new
license also contains an option for the licensee to buy-out the Rochas fashion
trademarks in June 2025, at its then fair market value.
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INTER PARFUMS, INC. AND SUBSIDIARIES
Our short-term financing requirements are expected to be met by available cash
on hand at March 31, 2021, and short-term credit lines provided by domestic and
foreign banks. The principal credit facilities for 2021 consist of a $20.0
million unsecured revolving line of credit provided by a domestic commercial
bank, and approximately $29.3 million in credit lines provided by a consortium
of international financial institutions. There were no short-term borrowings
outstanding as of both March 31, 2021 and 2020.
In October 2019, the Board of Directors authorized a 20% increase in the annual
dividend to $1.32 per share. In April 2020, as a result of the uncertainties
raised by the COVID-19 pandemic, the Board of Directors authorized a temporary
suspension of the quarterly cash dividend. In February 2021, our Board of
Directors authorized a reinstatement of an annual dividend of $1.00, payable
quarterly. The next quarterly cash dividend of $0.25 per share is payable on
June 30, 2021 to shareholders of record on June 15, 2021.
We believe that funds provided by or used in operations can be supplemented by
our present cash position and available credit facilities, so that they will
provide us with sufficient resources to meet all present and reasonably
foreseeable future operating needs.
Inflation rates in the U.S. and foreign countries in which we operate did not
have a significant impact on operating results for the three months ended March
31, 2021.
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INTER PARFUMS, INC. 
