INTERPARFUMS, INC. 2023 ANNUAL REPORT
INTERPARFUMS, INC. 2023 ANNUAL REPORT
1
table of contents
letter to our shareholders
letter to our shareholders
02
02
the company
the company
06
06
environmental, social & governance
environmental, social & governance 12
12
the products
the products
14
14
the organization
the organization
64
64
2
DEAR FELLOW SHAREHOLDERS,
2023 was the best year in our 40-plus year history. Once again,
we achieved record sales and earnings, maintained our strong
balance sheet, and increased our annual cash dividend by 20%
to $3.00 per share.
Inter Parfums moved further up the industry ranks – ac-
cording to Women’s Wear Daily (Annual Beauty Top 100), we
ranked 30th, up from 33rd and 40th in the two prior years,
respectively. This is especially gratifying considering we are a
Shareholders
2023
Letter to
Philippe Benacin and Jean Madar
INTERPARFUMS, INC. 2023 ANNUAL REPORT
INTERPARFUMS, INC. 2023 ANNUAL REPORT
3
letter to shareholders
pure-play fragrance company, and we are scored against compa-
nies that compete in multiple categories.
On the environmental, social, and governance (“ESG”) front,
we have always acted as good corporate citizens and taken
our responsibilities seriously. Like many of our industry com-
petitors, we are applying a multi-functional and comprehensive
approach to addressing corporate, environmental, and social re-
sponsibility issues, building off the United Nations’ Sustainable
Development Goals. Our European based operations have led
the way in this initiative, and our United States based operations
are actively following. While we recognize this important jour-
ney never ends, our efforts are increasingly being recognized.
We had multiple engines of growth in 2023, as our rich
portfolio of brands enabled us to reach a wide range of con-
sumers across multiple price points, geographies, age groups,
and genders. Our largest brands, Jimmy Choo, Montblanc, and
Coach each topped $200 million in sales, and our fourth largest,
GUESS, was not far behind. We also continued to lay the foun-
dation of future growth by adding two new brands to our port-
folio, Lacoste and Roberto Cavalli, and extending our fragrance
license with Montblanc to 2030. Our Italian subsidiary, which we
established in 2021 when we took over the Ferragamo license,
is fully operational and is already proving to be a superb asset.
On top of Ferragamo and Ungaro, we are also managing the
Roberto Cavalli License from Italy. Our goal is for this entity to
serve as a hub for Italian licenses. We are also consolidating the
distribution of all the Company’s brands into our Italian affiliate,
helping to unlock revenue growth and cost efficiencies.
In each quarter of 2023 we achieved record sales, totaling
$1.3 billion for the year, or 21% ahead of 2022. Sales in our three
largest markets – North America, Western Europe, and Asia –
grew by 22%, 16%, and 17%, respectively. We also achieved top-
line growth of 22% in the Middle East, 39% in Eastern Europe,
and 33% in Central and South America. Travel retail perked up
in 2023, and as of spring 2024, it is booming, driven by strong
growth in international leisure and business travel.
Sales from our European based operations increased 16%
in 2023, with significant gains by our leading brands – Jimmy
Choo, Montblanc, and Coach – as well as by most of our mid-
size brands, including Van Cleef & Arpels, Rochas, Kate Spade
and Karl Lagerfeld. Legacy fragrance sales, coupled with new line
extensions, made these gains possible. When it comes to prod-
uct introductions, in our experience, the key is to seek a bal-
ance between new blockbuster pillars, and line extensions, along
with commercial innovation to build the brands up to scale and
maintain their freshness and relevance over time. In December
2022, we entered into a 15-year worldwide exclusive license
with Lacoste, an emblematic brand in the world of fashion and
sport, established in and thriving since 1933. The agreement
became effective in January 2024, along with the commence-
ment of shipments.
For our United States based operations, net sales rose 33%,
largely from the continued success of GUESS fragrances and a
full year of sales of Donna Karan and DKNY, sister brands that
joined us in mid-2022. Since 2019, GUESS has been the largest
brand within United States operations. We have reinforced a
strong existing foundation and enriched the GUESS fragrance
family with a host of new pillars and brand extensions. The
fashion house duo, Donna Karan/DKNY, has been a valuable
addition to our portfolio, climbing to the second largest brand
under our stewardship. Ferragamo performed favorably with
sister scent enrichments for its hero collections. In addition, af-
ter nearly a decade developing a global fragrance enterprise for
Abercrombie & Fitch, they have entrusted us with their iconic
Fierce collection. In early 2023, we signed an agreement to dis-
tribute the Fierce family of products in major markets, phased in
over 2023 and 2024.
During 2023, we were able to grow net income at a faster
rate than sales, achieving a 26% increase in net income attribut-
able to Inter Parfums on a 21% increase in net sales. Our oper-
ating margin also expanded 120 basis points to 19.1%, up from
17.9% in 2022.
We continue to have a very strong balance sheet, closing
the year with working capital of $514 million, including approx-
imately $183 million in cash and cash equivalents and short-
term investments. Our long-term debt at December 31, 2023
was $128 million, linked to the Paris headquarters and Lacoste
license acquisitions.
Our financial standing, along with our track record of re-
invigorating underserved brands like Donna Karan/DKNY
or successfully building entirely new fragrance franchises for
brands such as Jimmy Choo, have made Inter Parfums a pre-
mier choice among brand owners seeking to expand or estab-
lish a fragrance dimension to their brands. We are always on
the lookout for new brands that suit our model, and at the
same time, we have pruned our portfolio to discontinue smaller,
underperforming brands.
We have terrific, highly recognized brands and global distribu-
tion that are a source of competitive advantage, but far and away
our most valuable resource is our team. By the end of 2023, we
had 607 full-time employees around the globe, which translates
into revenue per employee of over $2 million, exemplifying the
4
essence of productivity. We extend our heartfelt gratitude to
the entire team for their relentless efforts and contributions.
WHAT’S IN STORE FOR 2024?
In early 2024, we launched several new fragrances, including
Montblanc Legend Blue, Donna Karan Cashmere Collection, Van
Cleef & Arpels Encens Précieux, Karl Lagerfeld Rouge, Rochas
Orange Horizon, Kate Spade Bloom, and Lacoste L12.12 Blanc and
L12.12 Rose.
After revitalizing the established fragrance portfolios of Lacoste
and Roberto Cavalli, initial sales have reinforced our confidence
in these fragrance brands. We have an ambitious launch strategy
planned for the balance of 2024, including blockbuster fragrances
for DKNY and Lacoste, and extensions for the Jimmy Choo I Want
Choo line and Roberto Cavalli Signature line. Multi-scent collections
for GUESS are also in the works, followed in the fall by a new mem-
ber of the GUESS Uomo men’s fragrance family. The brand contin-
ues to show a high level of attractiveness, with strong desire and
demand that positively influences the fragrance lines, driving our
overall optimism. Lastly, extensions for Hollister’s Feelin’ Free and
Ferragamo’s Signorina will be unveiled later in the year.
IN CLOSING
We started this letter with Dear Fellow Shareholders, because
the two of us, co-founders of Inter Parfums, own in excess of
40% of the outstanding shares. That means our interests are
aligned with our investors. It also should be said that we are
deeply passionate about our work and really love what we do.
Some of our family members have joined the company and are
demonstrating the same interest and passion to continue the
adventure we have started.
Chairman of the Board
& Chief Executive Officer
Vice Chairman of the Board
& President
2023 marked a record-breaking year, and our expectations
are set even higher for 2024. The fragrance industry, particularly
within the prestige and premium categories, has been excep-
tionally strong since 2022, with premiumization, characterized
by high quality, high concentration fragrances, accounting for
much of the boom. We have enjoyed exceptional growth, not
only by riding the industry wave, but more importantly, by gain-
ing market share. Outpacing the industry remains one of our
goals. With an enduring commitment to staying at the forefront
of industry trends and ongoing creativity in the development
and marketing of our evolving portfolio of fragrances, we are
well positioned for the future.
Our gratitude extends to our brand owners who recognize
the value of our partnership approach, operational capabilities,
efficiency, and commitment to enhancing their brand recogni-
tion and income through synergistic fragrance sales. Similarly,
we thank our scores of suppliers and fillers across the globe.
And of course, we want to recognize and thank our extraordi-
nary distributors who enable our products to look great on the
shelves, every day, in 120 nations across the globe.
With sincere thanks and appreciation,
INTERPARFUMS, INC. 2023 ANNUAL REPORT
INTERPARFUMS, INC. 2023 ANNUAL REPORT
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letter to shareholders
letter to shareholders
Ferragamo Signorina Unica
6
The
Company
Founded in 1982, we operate in the fragrance business, and manufacture, market and distribute
a wide array of prestige fragrances, and fragrance related products.
Our worldwide headquarters and the office of our wholly owned United States subsidiary, Interparfums, USA LLC, are located at
551 Fifth Avenue, New York, New York 10176, and our telephone number is 212.983.2640. We also have wholly owned subsidiaries
as follows:
Country
Italy for organization, and France
for seat of management
Switzerland
United Arab Emirates
Hong Kong, special administrative region
of the Peoples Republic of China
Subsidiary
Interparfums Italia Srl
Interparfums, USA Swiss Ltd
Interparfums Middle East DMCC
Inter Parfums USA Hong Kong Limited
Function
Manufacture, market and distribute a
wide array of prestige fragrances, and
fragrance related products
Sales Office
Sales Office
Sales Office
Our consolidated wholly owned subsidiary, Inter Parfums Holdings, S.A., and its majority owned subsidiary, Interparfums SA,
maintain executive offices at 10 rue de Solférino, 75007 Paris, France. Our telephone number in Paris is 331.5377.0000. Interparfums
SA also has wholly owned subsidiaries as follows:
Country
Italy
USA
Switzerland
Republic of Singapore
Subsidiary
Interparfums Srl
Interparfums Luxury Brands, Inc.
Interparfums (Suisse) Sarl
Interparfums Singapore Pte., Ltd.
Function
Distribution
Distribution of prestige brands
in the United States
Holds and manages certain brand names
Sales and marketing office
Interparfums SA is also the majority owner of Parfums Rochas Spain, SL, a Spanish limited liability company, which specializes in the
distribution of Rochas fragrances.
INTERPARFUMS, INC. 2023 ANNUAL REPORT
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7
the company
Montblanc Legend Blue
8
Our common stock is listed on The Nasdaq Global Se-
lect Market under the trading symbol “IPAR”. The common
shares of our subsidiary, Interparfums SA, are traded on the
Euronext.
The Securities and Exchange Commission (“SEC”) maintains
an internet site at http://www.sec.gov that contains financial re-
ports, proxy and information statements, and other information
regarding issuers that file electronically with the SEC. We main-
tain our internet website at www.interparfumsinc.com, which is
linked to the SEC internet site. You can obtain through our web-
site, free of charge, our annual reports on Form 10-K, quarterly
reports on Form 10-Q, interactive data files, current reports
on Form 8-K, beneficial ownership reports (Forms 3, 4 and 5)
and amendments to those reports filed or furnished pursuant to
Section 13(a) of the Securities Exchange Act of 1934 as soon as
reasonably practicable after they have been electronically filed
with or furnished to the SEC.
We operate in the fragrance business, and manufacture, mar-
ket and distribute a wide array of prestige fragrances and fra-
grance related products. We manage our business in two based
operations, our European based operations and our United
States based operations. Certain prestige fragrance products
are produced and marketed by our European based operations
through our 72% owned subsidiary in Paris, Interparfums SA,
which is also a publicly traded company as 28% of Interparfums
SA shares trade on the Euronext.
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 either received and stored
directly at our third-party fillers or received at one of our dis-
tribution 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.
Our fragrance products focus on prestige brands, each with
a devoted following. By concentrating in markets where the
brands are best known, we have had many successful product
launches. We typically launch new fragrance families for our
brands every few years, and more frequently seasonal and limit-
ed edition fragrances are introduced as well.
The creation and marketing of each product family is inti-
mately linked with the brand’s name, its past and present po-
sitioning, customer base and, more generally, the prevailing
market atmosphere. Accordingly, we generally study the mar-
ket for each proposed family of fragrance products for almost a
full year before we introduce any new product into the market.
This study is intended to define the general position of the fra-
grance family and more particularly its scent, bottle, packaging
and appeal to the buyer. In our opinion, the unity of these four
elements of the marketing mix makes for a successful product.
As with any 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 in
fast-growing markets and channels to grow market share. We
discuss in greater detail risk factors relating to our business in
Item 1A of this Annual Report on Form 10-K for the fiscal year
ended December 31, 2023, and the reports that we file from
time to time with the SEC.
European Based Operations
We produce and distribute our fragrance products primarily un-
der license agreements with brand owners, and fragrance prod-
uct sales through our European based operations represented
approximately 65% of net sales for the year ended December 31,
2023. We have built a portfolio of prestige brands, which include
Boucheron, Coach, Jimmy Choo, Karl Lagerfeld, Kate Spade,
Lacoste, Lanvin, Moncler, Montblanc, Rochas, and Van Cleef &
Arpels, whose products are distributed in over 120 countries
around the world. The Lacoste fragrance license became effec-
tive on January 1, 2024.
United States Based Operations
Prestige brand fragrance products are also produced and market-
ed through our United States based operations and represented
approximately 35% of net sales for the year ended December
31, 2023. These fragrance products are sold under trademarks
owned by us or pursuant to license or other agreements with
the owners of brands, which include Abercrombie & Fitch, Anna
Sui, Donna Karan, DKNY, Ferragamo, Graff, GUESS, Hollister,
MCM, Oscar de la Renta, Roberto Cavalli, and Ungaro.
BUSINESS STRATEGY
Focus On Prestige Beauty Brands.
Prestige beauty brands are expected to contribute significantly
to our growth. We focus on developing and launching quality
fragrances utilizing internationally renowned brand names. By
identifying and concentrating in the most receptive market
based operations and territories where our brands are known,
and executing highly targeted launches that capture the essence
of the brand, we have had a history of successful launches.
Certain fashion designers and other licensors choose us as a
partner because our Company’s size enables us to work more
closely with them in the product development process as well as
our successful track record.
INTERPARFUMS, INC. 2023 ANNUAL REPORT
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9
Grow Portfolio Brands Through
New Product Development And Marketing
We grow through the creation of fragrance family extensions
within the existing brands in our portfolio. We regularly cre-
ate a new family of fragrances for each brand in our port-
folio. We frequently introduce seasonal and limited edition
fragrances as well. With new introductions, we leverage our
ability and experience to gauge trends in the market and fur-
ther leverage the brand name into different product families
in order to maximize sales and profit potential. We have had
success in introducing new fragrance families (sub-brands or
flankers) within our brand franchises. Furthermore, we pro-
mote the performance of our prestige fragrance operations
through knowledge of the market, detailed analysis of the
image and potential of each brand name, and a highly profes-
sional approach to international distribution channels.
Continue To Add New Brands
To Our Portfolio, Through New Licenses
Or Acquisitions
Prestige brands are the core of our business, and we intend
to add new prestige beauty brands to our portfolio. Over
the past 35 years, we have built our portfolio of well-known
prestige brands through acquisitions and new license agree-
ments. We intend to further build on our success in prestige
fragrances and pursue new licenses and acquire new brands
to strengthen our position in the prestige beauty market. To
that end, in 2021, we closed on a transaction agreement with
Salvatore Ferragamo S.p.A., whereby an exclusive and world-
wide license was granted for the production and distribution
of Ferragamo brand perfumes. Also in 2021, we entered into
a long-term global licensing agreement for the creation, de-
velopment and distribution of fragrances and fragrance-relat-
ed products under the Donna Karan and DKNY brands. This
exclusive license became effective in July 2022. During 2022,
we closed a transaction agreement with Lacoste, whereby an
exclusive and worldwide license was granted to Interparfums
SA for the production and distribution of Lacoste brand per-
fumes and cosmetics effective January 1, 2024. During 2023,
we closed on a transaction agreement with Roberto Cavalli,
whereby an exclusive and worldwide license was granted for
the production and distribution of Roberto Cavalli brand per-
fumes and fragrance related products. This license became
effective in July 2023. As of December 31, 2023, we had cash,
cash equivalents and short-term investments of approximate-
ly $182.8 million, which we believe should assist us in enter-
ing new brand licenses or outright acquisitions. We identify
prestige brands that can be developed and marketed into a
full and varied product families and, with our technical knowledge
and practical experience gained over time, take licensed brand
names through all phases of concept, development, manufacturing,
marketing and distribution.
Expand Existing Portfolio
Into New Categories
We selectively broaden our product offering beyond the fragrance
category and offer other fragrance related products and personal
care products under some of our existing brands. We believe such
product offerings meet customer needs, generate trial and further
strengthen customer loyalty.
Continue To Build
Global Distribution Footprint
Our business is a global business, and we intend to continue to
build our global distribution footprint. In order to adapt to changes
in the environment and our business, in addition to our arrange-
ments with third party distributors globally, we are operating
distribution subsidiaries or divisions in the major markets of the
United States, France, Italy and Spain for distribution of prestige
fragrances. We may look into future joint arrangements or acquire
distribution companies within other key markets to distribute
certain of our prestige brands. While building a global distribution
footprint is part of our long-term strategy, we may need to make
certain decisions based on the short-term needs of the business.
We believe that in certain markets, vertical integration of our dis-
tribution network may be one of the keys to future growth of our
Company, and ownership of such distribution should enable us to
better serve our customers’ needs in local markets and adapt more
quickly as situations may determine.
RECENT DEVELOPMENTS
Abercrombie & Fitch
In 2023, we announced our agreement to distribute Abercrombie
& Fitch’s number one men’s fragrance, Fierce, in selected mar-
kets. The first phase of the agreement, which became effective
on September 1, 2023, covers Fierce distribution in certain ma-
jor markets, including Europe, Mexico and Australia. The second
phase, which activated in February 2024, covers distribution in
additional markets in Western Europe and Latin America, and may
include other flankers of the Fierce family of products.
Roberto Cavalli
We entered into an exclusive worldwide fragrance license for
the Roberto Cavalli brand, for 6.5 years, effective July 6, 2023.
Our Roberto Cavalli fragrance license is held and operated by
our Italian subsidiary, Interparfums Italia, Srl, in keeping with
the company
10
the Company’s strategy to develop an Italian brand hub, and
is managed out of Paris, France. The first seven months of the
license have been focused on producing finished goods, and we
actively started distributing these products with key customers
in February 2024. Our rights under this license are subject to
certain minimum advertising expenditures and royalty payments
as are customary in our industry.
Lacoste
In December 2022, we closed a transaction agreement with
Lacoste, whereby an exclusive and worldwide license was grant-
ed to Interparfums SA for the production and distribution of
Lacoste brand perfumes and cosmetics. Our rights under this
license are subject to certain minimum advertising expenditures
and royalty payments as are customary in our industry. The li-
cense became effective in January 2024 and will last for 15 years.
Dunhill
The Dunhill fragrance license expired on September 30, 2023
and was not renewed. The Company has now entered the
twelve-month sell-off period during which it will maintain the
right to sell-off remaining Dunhill fragrance inventory, which
is customary in the fragrance industry. All usable components
have been converted to finished goods, and any remaining com-
ponents will be destroyed.
Salvatore Ferragamo
In October 2021, we closed on a transaction agreement with
Salvatore Ferragamo S.p.A., whereby an exclusive and world-
wide license was granted for the production and distribution
of Ferragamo brand perfumes. Our rights under this license
are subject to certain minimum advertising expenditures and
royalty payments as are customary in our industry. The license
became effective in October 2021 and will last for 10 years with
a 5-year optional term, subject to certain conditions.
With respect to the management and coordination of activ-
ities related to the license agreement, the Company operates
through a wholly owned Italian subsidiary based in Florence,
that was acquired from Salvatore Ferragamo on October 1,
2021. The acquisition together with the license agreement was
accounted for as an asset acquisition.
Emanuel Ungaro
In October 2021, we also entered into a 10-year exclusive global
licensing agreement with a 5-year optional term subject to certain
conditions, with Emanuel Ungaro Italia S.r.l, for the creation, de-
velopment and distribution of fragrances and fragrance-related
products under the Emanuel Ungaro brand. Our rights under this
license are subject to certain minimum advertising expenditures
and royalty payments as are customary in our industry.
Donna Karan and DKNY
In September 2021, we entered into a long-term global licensing
agreement for the creation, development and distribution of fra-
grances and fragrance-related products under the Donna Karan
and DKNY brands. Our rights under this license are subject to
certain minimum advertising expenditures and royalty payments
as are customary in our industry. With this agreement, we have
gained several well-established and valuable fragrance franchis-
es, most notably Donna Karan Cashmere Mist and DKNY Be
Delicious, as well as a significant loyal consumer base around the
world. In connection with the grant of license, we issued 65,342
shares of Inter Parfums, Inc. common stock valued at $5.0 mil-
lion to the licensor. The exclusive license became effective on
July 1, 2022, and we are planning to launch new fragrances under
these brands in 2024.
Rochas Fashion
As a result of operational challenges faced by the Rochas Fashion
business we took a $2.4 million impairment charge on our Rochas
fashion trademark in the first quarter of 2021. In the fourth
quarter of 2022, we again took a $6.8 million impairment charge
on the Rochas fashion trademark after an independent expert
concluded that the valuation of the trademark was $11.3 million.
In 2023, the Rochas teams underwent a strategic shift to take
over their own brand operations, exiting contracts with manu-
facturers and distributors to make this new structure operational
beginning in 2024. An independent expert concluded that the
valuation based on this new business model was consistent with
prior valuations and no additional impairments were needed.
PRODUCTION AND SUPPLY
The stages of the development and production process for all
fragrances are as follows:
• Simultaneous discussions with perfume designers and creators
(includes analysis of esthetic and olfactory trends, target clien-
tele and market communication approach)
• Concept choice
• Produce mock-ups for final acceptance of bottles and packaging
• Receive bids from component suppliers (glass makers,
plastic processors, printers, etc.) and packaging companies
• Choose suppliers
• Schedule production and packaging
• Issue component purchase orders
INTERPARFUMS, INC. 2023 ANNUAL REPORT
INTERPARFUMS, INC. 2023 ANNUAL REPORT
11
the company
• Follow quality control procedures for incoming components;
and
• Follow packaging and inventory control procedures
Suppliers who assist us with product development include,
but are not limited to:
• Independent perfumery design companies (Aesthete, Carré
Basset, PI Design, Cent Degrés)
• Perfumers (IFF, Givaudan, Firmenich, Robertet, Takasago,
Mane) who create a fragrance consistent with our expectations
and, that of the fragrance designers and creators
• Fillers (Voyant, CPFPI, Omega Packaging, Societe de Diffusion
de Produits de Parfumerie, TSM Brands, ICR, Cosmint, Tatra,
Arcade Beauty)
• Bottle manufacturers (Pochet du Courval, Verescence,
Verreries Brosse, Bormioli Luigi, Stoelzle Masnières, Heinz),
caps (Qualipac, ALBEA, RPC, Codiplas, LF Beauty, Texen
Group, S.A.R.L. J3P, SBG Packaging Group), Pumps (Silgan
Dispensing Systems Thomaston Corp, Aptar, Rexam) or boxes
(Autajon, Diamond Packaging, TPC Printing)
• Logistics (DiFarco, Bansard, Bolloré Logistics for storage, or-
der preparation and shipment)
Suppliers’ accounts for our European based operations are
primarily settled in euro and for our United States based oper-
ations, suppliers’ accounts are primarily settled in U.S. dollars.
For our European based operations components for our pres-
tige fragrances are purchased from many suppliers around the
world and are primarily manufactured in France.
For United States based operations, components for our
prestige fragrances are sourced from many suppliers around
the world and are primarily manufactured in the United States
and Italy. Additionally, we occasionally utilize third party manu-
facturers in China, Poland and Turkey.
MARKETING AND DISTRIBUTION
Our products are distributed in over 120 countries around the
world through a selective distribution network. For our interna-
tional distribution, we either contract with independent distribu-
tion companies specializing in luxury goods or distribute prestige
products through our distribution subsidiaries. In each country,
we designate anywhere from one to three distributors on an
exclusive basis for one or more of our name brands. We also
distribute our products through a variety of duty-free operators,
such as airports and airlines, and select vacation destinations.
As our business is a global one, we intend to continue to
build our global distribution footprint. For the distribution
of brands within our European based operations, we operate
through our distribution subsidiaries or divisions in the major
markets of the United States, France, Italy and Spain, in addi-
tion to our arrangements with third party distributors globally.
Our third party distributors vary in size depending on the num-
ber of competing brands they represent. This extensive and di-
verse network together with our own distribution subsidiaries
provides us with a significant presence in over 120 countries
around the world.
Over 50% of our European based prestige fragrance net sales
are denominated in U.S. dollars. We address certain financial ex-
posures through a controlled program of risk management that
includes the use of derivative financial instruments. We primarily
enter into foreign currency forward exchange contracts to re-
duce the effects of fluctuating foreign currency exchange rates.
The business of our European based operations has become
increasingly seasonal due to the timing of shipments by our dis-
tribution subsidiaries and divisions to their customers, which
are weighted to the second half of the year.
For our United States operations, we distribute products to
retailers and distributors in the United States as well as inter-
nationally, including duty-free and other travel-related retail-
ers. We also utilize our in-house sales team to reach our third
party distributors and customers outside the United States. In
addition, the business of our United States operations has be-
come increasingly seasonal as shipments are weighted toward
the second half of the year.
Jimmy Choo I Want Choo
12
transparency, building off the UN Sustainable Development Goals.
Our European-based operations have led the way in this initiative,
and our US operations are actively following.
ESG STRATEGY
Inter Parfums, Inc., our parent company, uses a multi-step
process for Environment, Social, Governance (“ESG”) related
activities and reporting. Following the work done in ESG by
our French-based subsidiary, Interparfums SA, in September
2022, we launched our United States ESG program for our
subsidiaries, Interparfums, USA LLC in the United States and
Interparfums, Italia Srl in Italy. Environmental data regarding our
regional sales offices in Geneva, Dubai, and Hong Kong still need
to be incorporated into our ESG reporting. The final step in our
ESG reporting will be the combination of both ESG programs
into a single cohesive report.
GOVERNANCE
Inter Parfums, Inc. adheres to corporate governance codes
including anti-hedging, bribery, fraud, and prohibition against
insider trading. The Company’s management is respon-
sible for developing and implementing its ESG strategies
and programs under the ultimate oversight of the Board of
Directors. Inter Parfums, Inc. is a publicly traded company
(Nasdaq GS: IPAR) and files reports with the Securities and
Exchange Commission (“SEC”). Our largest subsidiary, 72%
owned Interparfums SA, is also a publicly traded company and
complies with the reporting requirements of the Euronext.
Interparfums SA maintains a governance policy related to its
status as a publicly-held French company and complies with
this policy where applicable.
UNITED STATES-BASED OPERATIONS ESG
Interparfums’ United States-based operations ESG strategy is
based upon the challenges we face, our risk analysis, and the ex-
pectations of our stakeholders. It reflects the United Nations’
sustainable development goals (https://sdgs.un.org/fr/goals). We are
committed to:
• Fostering a more diverse and inclusive culture and impacting our
community. Our human capital is our greatest asset.
• Keep reducing and optimizing our environmental footprint. Cli-
mate change requires urgent action.
• Creating sustainable fragrances throughout their whole life cycle.
The procurement of materials considers all those aspects.
• Maintaining transparency and compliance with all applicable
laws, rules, and regulations, particularly regarding chemicals and
hazardous materials.
THE FOLLOWING IS A BRIEF SUMMARY OF THE
ENVIRONMENTAL, SOCIAL & GOVERNANCE
STRATEGIES AND BEST PRACTICES FOR INTER
PARFUMS, INC., ITS UNITED STATES-BASED
OPERATIONS INTERPARFUMS, USA LLC, AND
INTERPARFUMS, ITALIA SRL IN ITALY AS
WELL AS ITS FRENCH-BASED SUBSIDIARY,
INTERPARFUMS SA.
ENVIRONMENTAL, SOCIAL & GOVERNANCE
Both our United States-based operations and our European-based
operations are good corporate citizens and take our responsibilities
seriously. We comply with all applicable laws, rules, and regulations
in general, particularly regarding chemicals and hazardous materials.
Throughout our supply chain, from procurement of components to
distribution of finished products, we act responsibly and monitor
and comply with all legal requirements. While we do not own our
manufacturing facilities, we set a high bar with our industrial part-
ners by emphasizing quality, using good manufacturing practices and
innovation, and encouraging them to build strong ESG programs of
their own. Like many of our industry competitors, we are applying
a multifunctional and comprehensive approach to addressing the
issues of corporate, environmental, and social responsibility and
Governance
Environmental
Social &
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13
We act as a climate stakeholder and anticipate future regula-
tions. While we measure the carbon footprint of our activities
and are at the low end of our industry sector, we are committed
to reducing it through all product developments and marketing.
We work with our business partners, contractors, and suppliers
to ensure our fragrances are sustainable throughout their life
cycle, from ingredient sourcing and manufacturing to packaging,
advertising, and distribution. Our family-oriented management
strives to cultivate a culture that promotes our values of entre-
preneurship, commitment, creativity and passion, in a respectful
and inclusive work environment, while empowering our employ-
ees to develop their skills and grow their career.
INTERPARFUMS SA CSR/ESG
Interparfums SA has identified its Corporate Social Responsibility
challenges by considering stakeholder and market expectations.
The Company established a CSR Executive Committee in early
2021, comprising several divisions such as Operations & Supply
Chain, Human Resources, Finance, Legal, and Communications.
The committee formalized the Company’s CSR strategy with
the following goals:
- Formalizing a “Responsible Employer Charter” and strengthening
the employee training plan
- Reducing its ecological footprint and involving suppliers in the
process through optimized eco-design specifications and the use
of recycled and recyclable materials
- Measuring its carbon footprint using the GHG protocol method-
ology and initiating a low-carbon trajectory
- Formalizing a business ethics charter to strengthen its sustainable
development approach
Interparfums SA’s ESG targets align with its Corporate Social
Responsibility strategy. Since January 2024, thanks to improve-
ment in ESG performance, Interparfums SA has been ranking
26th out of 104 companies, according to Sustainalytics, a leading
ESG rating firm.
The first sustainable development goal is to ensure the health
and safety of consumers in the cosmetic products Interparfums
SA creates and markets.
In 2022, Interparfums SA formalized an optimized eco-design
charter and shared it internally and externally with its subcon-
tracting partners and suppliers. The charter aims to highlight
the best practices for optimizing the eco-design of the Compa-
ny’s products across its value chain, including ingredient selec-
tion, techniques and materials, recycling and waste disposal, and
reducing CO2 emissions.
Natural ingredients are always prioritized across all products,
with over 80% natural fragrances and between 79% and 88%
natural ingredients for other products like aftershave balm, hand
cream, shower gel, and body lotion.
Another of Interparfums SA’s main focus is managing the en-
vironmental impact of its operations in its head office in Paris
and its High-Environmental-Quality (HEQ) certified warehouse
in Normandy.
Interparfums SA constantly monitors energy and water con-
sumption indicators to identify opportunities for improving en-
ergy efficiency in lighting, heating, and ventilation.
At the warehouse level, waste production is closely
monitored.
In 2023, 27 tons of waste were recycled, and 3 tons of
non-hazardous waste were incinerated with heat recovery.
Since 2021, the Company has committed to a low-carbon
trajectory, whether for logistics and inter-plant transport or
for the head office’s regulations in terms of energy, water, and
transportation. This goal is shared with suppliers to encourage
them to measure and master their own carbon footprint within
the EcoVadis scope.
Interparfums SA also strives to have a positive impact on the
planet through its philanthropic contributions. One of the caus-
es it supports is The Sea Cleaners, a charity founded by yachts-
man Yvan Bourgnon to help clean up the oceans by deploying
boats to collect and recycle plastic waste.
Altogether, the “Interparfums SA spirit” is guiding its ESG
strategy. Management attaches the utmost importance to en-
suring that every stakeholder understands and supports it,
whether a shareholder, a licensor, a distributor, a supplier, or,
even more so, an employee.
Interparfums SA is a caring employer committed to every-
one’s success. Training courses and development plans enhance
the quality of the work carried out by the employees through-
out their careers, enabling them to broaden their technical,
managerial, and personal skills.
The Company’s ethical pledge has been formalized in a char-
ter called the “Code of Conduct,” to which each employee ad-
heres. It focuses on health, safety, discipline, risk prevention,
harassment, respect for individual freedoms, sensitive transac-
tions, fraud, and business confidentiality.
Diversity of profiles, cultures, ages, and genders is a source
of strength for Interparfums SA. As an inclusive company, it
has been organizing an annual disability awareness campaign in
which all employees have been invited to participate since 2019.
Full information can be found in our 10K as well as in the cur-
rent ESG report on our website
https://www.interparfumsinc.com/esg
environmental, social & governance
14
Our licenses expire on the following dates:
Brand Name
Expiration Date
Abercrombie & Fitch
Extends until either party
terminates on 3 years’ notice
Anna Sui
December 31, 2026,
plus one 5-year optional term
Boucheron
December 31, 2025,
plus a 5-year optional term
if certain sales targets are met
Coach
June 30, 2026
We are the owner of the Rochas brand, and
the Lanvin brand name and trademark for
our class of trade. In addition, we have built
a portfolio of licensed prestige brands where-
by we produce and distribute our prestige fra-
grance products under license agreements
with brand owners. Under license agreements,
we obtain the right to use the brand name, cre-
ate new fragrances and packaging, determine
positioning and distribution, and market and
sell the licensed products, in exchange for
the payment of royalties. Our rights under li-
cense agreements are also generally subject
to certain minimum sales requirements and
advertising expenditures as are customary in
our industry.
The
Products
DKNY
December 31, 2032,
plus a 5-year optional term
if certain sales targets are met
Donna Karan
December 31, 2032,
plus a 5-year optional term
if certain sales targets are met
Dunhill
Expired September 30, 2023,
sell off period until
September 30, 2024
Emanuel Ungaro
December 31, 2031,
plus a 5-year optional term
if certain sales targets are met
Ferragamo
December 31, 2031, plus a 5-year
optional term if certain sales
targets are met
French Connection
December 31, 2027, plus
a 10-year optional term if certain
sales targets are met
Graff
December 31, 2026,
plus 3 optional 3-year terms
if certain sales targets are met
GUESS
December 31, 2033
Hollister
Extends until either party
terminates on 3 years’ notice
Jimmy Choo
December 31, 2031
Karl Lagerfeld
October 31, 2032
Kate Spade
June 30, 2030
Lacoste
December 31, 2038
MCM
December 31, 2030,
plus 4 option years
Moncler
December 31, 2026,
plus a 5-year optional term
if certain conditions are met
Montblanc
December 31, 2030
Oscar de la Renta
December 31, 2031,
plus a 5-year optional term
if certain sales targets are met
Roberto Cavalli
December 31, 2029
Van Cleef & Arpels
December 31, 2024
In connection with the acquisition of the Lanvin brand names
and trademarks for our class of trade, we granted the seller the
right to repurchase the brand names and trademarks on July 1,
2027 for €70 million (approximately $77 million) in accordance
with an amendment signed in 2021. In connection with such
amendment, we also granted a license to the seller to develop
and sell cosmetics other than fragrances.
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Portfolio
the products
Fragrance
16
In 2010, we entered into an exclusive license agreement to cre-
ate, develop, and distribute fragrances and fragrance related
products under the Montblanc brand. In 2015, we extended the
agreement to December 31, 2025 and in 2023, we extended the
agreement for a second time through December 31, 2030.
Montblanc has achieved a world-renowned position in the
luxury-based operations and has become a purveyor of exclu-
sive products, which reflect today’s exacting demands for time-
less design, tradition and master craftsmanship. Through its
leadership positions in writing instruments, watches and leather
goods, promising growth outlook in women’s jewelry, interna-
tional retail footprint through its network of more than 600
boutiques, high standards of product design and quality, Mont-
blanc has grown to be our largest fragrance brand.
In 2011, we launched our first new Montblanc fragrance, Leg-
end, which quickly became our best-selling men’s line and has giv-
en rise to a plethora of flankers including Legend Night, Legend
Spirit, and Legend Red. In 2014, we launched our second men’s line,
Emblem and like its predecessor, Emblem gave rise to brand ex-
tensions. In 2019, we unveiled Montblanc Explorer, which has add-
ed numerous flankers including Ultra Blue and Platinum. In 2024,
a four-scent premium collection will debut, Montblanc Collection.
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Montblanc Montblanc Collection
the products
18
In 2009, we entered into an exclusive 12-year worldwide license
agreement for the creation, development and distribution of
fragrances and fragrance related products under the Jimmy
Choo brand, and in 2017, we extended the license agreement
which now runs through December 31, 2031.
Jimmy Choo encompasses a complete luxury accessories
brand. Women’s shoes remain the core of the product offer-
ing, alongside handbags, small leather goods, scarves, eyewear,
belts, fragrances and men’s shoes. Jimmy Choo has a global
store network encompassing more than 200 stores and is pres-
ent in the most prestigious department and specialty stores
worldwide. Jimmy Choo is part of the Capri Holdings Limit-
ed luxury fashion group. On August 10, 2023, Tapestry, Inc.
entered into a definitive agreement under which Tapestry will
acquire Capri Holdings, with the final closing date expected
to come in 2024. There is no current information that would
indicate this purchase would have any material impact on the
Company’s operations.
In the decade that followed, Jimmy Choo has grown to be-
come our second largest brand with new pillars and flankers
debuting regularly, both for men and women. Our newest
women’s fragrance pillar, Rose Passion, was unveiled in 2023.
Established fragrance collections, including Jimmy Choo, Jimmy
Choo Man, and Jimmy Choo I Want Choo continue to see interna-
tional success.
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Jimmy Choo Jimmy Choo Man Aqua
the products
20
In 2015, we entered into an exclusive 11-year worldwide license
to create, produce and distribute new men’s and women’s fra-
grances and fragrance related products under the Coach brand
name. We distribute these fragrances globally to department
stores, specialty stores and duty-free shops, as well as in Coach
retail stores.
Founded in 1941, Coach is the ultimate American leath-
er goods brand and has always been renowned for its quality
craftsmanship. Now the luxury brand that best embodies New
York’s casual elegance, Coach also offers collections of ready-
to-wear, lifestyle accessories and fragrances. Its contemporary
approach to luxury combines authenticity and innovation, ex-
ported worldwide thanks to its thoroughly American non-con-
formist vision.
In 2016, we launched our first Coach fragrance, a women’s
signature scent, and in 2017, a men’s scent, both of which became
and remain top selling prestige fragrances. Subsequent flankers
and extensions have enlarged the Coach fragrance enterprise
as have entirely new collections, including Coach Dreams which
debuted in early 2020, and its sister scent, Dreams Sunset, Coach
Wild Rose, and Coach Open Road, a new fragrance for men. In
2023, we continued to enrich the Coach fragrance lines with the
roll-out of a number of flankers and launched Coach Love.
Coach is part of the Tapestry house of brands.
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Coach Coach Love
the products
22
In 2018, we entered into an exclusive, 15-year worldwide license
agreement with GUESS?, Inc. for the creation, development and
distribution of fragrances under the GUESS brand.
Established in 1981, GUESS began as a jeans company and has
since successfully grown into a global lifestyle brand. GUESS?,
Inc. designs, markets, distributes and licenses a lifestyle collec-
tion of contemporary apparel, denim, handbags, watches, foot-
wear and other related consumer products. GUESS products
are distributed through branded GUESS stores as well as bet-
ter department and specialty stores around the world.
We began selling GUESS legacy scents in 2018. In 2019 the
GUESS brand quickly became the largest within our United
States based operations, with legacy fragrances dominating the
sales mix.
Since joining our portfolio, we have introduced several new
blockbuster scents, including Bella Vita, Effect, and Uomo, the
newest men’s fragrance for GUESS, which came to market in
2022 with a flanker debuting in 2023. In 2024, we will launch
GUESS Iconic, a new blockbuster scent for women, in addition
to the roll-out of an innovative extension.
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Guess Iconic
the products
24
In July 2022, our long-term global fragrance licence
for the Donna Karan brand became effective. Donna
Karan is recognized as a fashion pioneer, and in 2004
she received a lifetime achievement award from the
Council of Fashion Designers of America. With roots
that date back to 1984, the Donna Karan brand of
today has been reimagined for a new era of modern
women, expanding into an all-encompassing wardrobe
of sportswear, handbags, footwear, accessories and
select licensed products. The brand’s lead fragrance,
Cashmere Mist, launched in 1994 and was honored with
the Fragrance Foundation Hall of Fame Award in 2019.
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the products
Donna Karan Cashmere Mist
T H E U LT I M AT E L AY E R O F L U X U R Y
26
DKNY fragrances joined the Inter Parfurns fragrance
portfolio on July 1, 2022. The DKNY brand emerged
in 1989 as the “next generation” fashion response to
Donna Karan’s then teenage daughter raiding through
her mom’s closet. Today, DKNY designs, markets and
globally distributes collections of apparel, accessories,
footwear, and select licensed products. Be Delicious,
the brand’s best known scent which launched in
2004, was named one of the 25 Perfumes of All Time
in April 2022 by Marie-Claire magazine. Like our
Donna Karan fragrance license, our exclusive DKNY
license was awarded to us by the G-III Apparel Group
in September 2021. DKNY, along with its associated
brand, Donna Karan, have emerged as superstars
among our U.S. operations.
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DKNY 24/7
the products
28
In October 2021, we closed on a transaction agreement with
Salvatore Ferragamo S.p.A., whereby an exclusive and world-
wide 10-year license was granted for the production and dis-
tribution of Ferragamo brand perfumes, with a 5-year optional
term if certain conditions are met.
Salvatore Ferragamo S.p.A. is the parent company of the Sal-
vatore Ferragamo Group, one of the world’s leaders in the lux-
ury industry and whose origins date back to 1927. Named after
its founder, the brand still represents and lives by the original
values of Salvatore Ferragamo. The uniqueness and exclusivity
of its creations, along with the perfect blend of style, creativi-
ty and innovation enriched by the quality and superior crafts-
manship of the ‘Made in Italy’ tradition, have always been the
hallmarks of the Salvatore Ferragamo’s products notably shoes,
leather goods, apparel, silk products and other accessories for
men and women.
The current fragrance lineup includes Storie di Seta, a col-
lection of four refined, luminous olfactory works of art. Each
fragrance is made with rare, sustainable raw materials, and can
be worn alone or in combination, creating a personalized mul-
tifaceted scent. The genderless collection is comprised of four
fragrances in four colors. Four exclusive motifs drawn from the
House’s textile heritage adorn each flacon. Established scents in
the Ferragamo portfolio include Ferragamo, a collection of fra-
grances for men, Signorina, a collection of fragrances for women,
the Tuscan Creations series, the Amo series and the Uomo series.
In 2023, we rolled out new flankers for the Signorina collection,
Liberia, a Storie di Seta duo, Cieli & Foreste, and a four-scent col-
lection for Ferragamo. New flankers are in the works for 2024.
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Ferragamo Red Leather
the products
30
In December 2022, we closed a transaction agreement with
Lacoste, whereby an exclusive and worldwide license was
granted for the production and distribution of Lacoste brand
perfumes and cosmetics.
At the juncture of sport and fashion, Lacoste frees us up, cre-
ates movement in our lives, and liberates our self-expression.
In every collection, in every line, Lacoste’s timeless elegance is
captured through a combination of the creative and the clas-
sic. Since its beginnings, the crocodile’s aura has grown more
powerful with every generation who has worn it, becoming a
rallying sign beyond style. Passed from country to country, from
one generation to the next, from one friend to another, Lacoste
pieces become imbued with an emotional connection that raises
them to the status of icons.
The Lacoste license took into effect in January 2024, and we
have been using the time since the license was signed to develop
go-forward strategies, curate the collection, and produce en-
tirely new fresh goods.
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the products
Lacoste Lacoste Original
32
In 2007, we acquired the worldwide rights to the Lanvin brand
names and international trademarks listed in Class 3, our class
of trade. A synonym of luxury and elegance, the Lanvin fashion
house, founded in 1889 by Jeanne Lanvin, expanded into fra-
grances in the 1920s.
Lanvin fragrances occupy an important position in the selec-
tive distribution market in France, Eastern Europe and Asia, and
we have several lines currently in distribution, including Éclat
d’Arpège, Lanvin L’Homme, Jeanne Lanvin, Modern Princess, A Girl in
Capri, and Les Fleurs de Lanvin.
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Lanvin Les Fleurs de Lanvin, Sweet Jasmine
the products
34
In 2015, we acquired the Rochas brand from The Procter
& Gamble Company. Founded by Marcel Rochas in 1925, the
brand began as a fashion house and expanded into perfumery in
the 1950s under Hélène Rochas’ direction.
With Rochas, nature is synonymous with French-style gar-
dens, eternal springs, freshness, and innocence. Never dry,
these gardens are constantly irrigated by the water of dreams
and lit by the sun of the imagination. Rochas’ birds and flow-
ers are regularly revisited in the ready-to-wear creations and
perfumes. They are part of the natural lifeblood of Rochas, a
constant presence thronging with a multitude of colors and a
very Parisian spirit.
Our first new fragrance for Rochas, Mademoiselle Rochas, had
a successful launch in 2017 in its traditional markets of France
and Spain. Over the next few years, we debuted flankers for leg-
acy scents Eau de Rochas and Mademoiselle Rochas, plus others,
and in 2018 we launched our first new men’s line, Rochas Mous-
tache. Byzance debuted in early 2020 and Rochas Girl in 2021. The
first flanker for both came to market in 2022 as well as one for
L’Homme Rochas. In 2023, we rolled-out pillar extensions Eau de
Rochas Citron Soleil and Rochas Girl Life.
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the products
Rochas Mademoiselle Rochas in Paris
36
In 2014, we entered into a worldwide license to create, pro-
duce and distribute new fragrances and fragrance related prod-
ucts under the Abercrombie & Fitch brand name. We distribute
these fragrances in specialty stores, department stores and du-
ty-free shops, and in the U.S., in select Abercrombie & Fitch
retail stores. Our initial men’s scent, First Instinct, was launched
in 2016 followed by a women’s version in 2017. Since that time,
we unveiled several new fragrances, most notably the Authentic
and Away duos as well as brand extensions.
Abercrombie & Fitch Co. is a leading, global, omnichannel
specialty retailer of apparel and accessories for men, women
and kids. The iconic Abercrombie & Fitch brand was born in
1892 and aims to make every day feel as exceptional as the start
of a long weekend.
In 2023, we announced our agreement to distribute Aber-
crombie & Fitch’s number one men’s fragrance, Fierce, in select-
ed markets. The first phase of the agreement, which became
effective on September 1, 2023, covers Fierce distribution in
certain major markets, including Europe, Mexico and Austra-
lia. The second phase, which activated in February 2024, covers
distribution in additional markets in Western Europe and Latin
America, and may include other flankers of the Fierce family of
products.
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the products
Abercrombie & Fitch Fierce
38
In 2014, we entered into a worldwide license to create, produce
and distribute new fragrances and fragrance related products
under the Hollister brand name. We distribute these fragrances
in specialty stores, department stores and duty-free shops.
The quintessential apparel brand of the global teen consum-
er, Hollister celebrates the liberating spirit of the endless sum-
mer inside everyone. Inspired by California’s laidback attitude,
Hollister’s clothes are designed to be lived in and made your
own, for wherever life takes you.
In 2016, we launched our first men’s and women’s fragrance
duo, Wave, which led to several extensions, as did subsequent
fragrance families Festival and Canyon Escape. In 2023, we
launched a new blockbuster scent, Feelin’ Good, with plans to
enrich the line with a new flanker in 2024.
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Hollister Feelin’ Free
the products
40
In 2013, we entered into an exclusive worldwide license to
create, produce and distribute fragrances and fragrance relat-
ed products under the Oscar de la Renta brand. In 2019, the
agreement was extended through December 31, 2031, with an
additional five-year option potentially extending the agreement
through December 31, 2036.
Oscar de la Renta is one of the world’s leading luxury goods
firms. The New York-based company was established in 1965,
and encompasses a full line of women’s accessories, bridal, chil-
dren’s wear, fragrance, beauty and home goods, in addition to
its internationally renowned signature women’s ready to wear
collection. Oscar de la Renta products are sold globally in fine
department and specialty stores, www.oscardelarenta.com and
through wholesale channels.
After taking over distribution of the brand’s legacy fragrances
in 2014, we introduced Extraordinary the following year. Oscar
de la Renta Bella Blanca debuted in 2018, followed by Bella Rosa,
Bella Essence, Bella Bouquet, and Bella Night. In 2021, we debuted
an entirely new fragrance pillar, Alibi, which welcomed sister
scents, Alibi Eau de Toilette, and more recently, Alibi Eau Sensuelle.
In 2024, we will unveil the Alibi ‘Pop’ three-scent collection.
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Oscar de la Renta Alibi
the products
discover the new fragrance
alibi
42
In 2018, we renewed its license agreement for an additional six
years with Van Cleef & Arpels for the creation, development,
and distribution of fragrance products through December 2024.
Our initial 12-year license agreement with Van Cleef & Arpels
was signed in 2006.
Since its founding in 1906, Van Cleef & Arpels has often
turned to nature as an inexhaustible source of inspiration. En-
thralled by the constant metamorphoses of flora and fauna, the
Maison creates pieces that echo the blooming of flowers and
the lushness of gardens. Over the decades, the excellence and
creativity of the High Jewelry Maison established its reputation
across the world.
Van Cleef & Arpels fragrances in current distribution include:
First and Collection Extraordinaire. Sales of the Collection Extraor-
dinaire line have experienced continued growth since its debut.
We continue to introduce new additions to the Van Cleef & Ar-
pels Collection Extraordinaire assortment annually, including Oud
Blanc, Rêve de Matiere, and Patchouli Blanc, with further additions
planned. Founded in 1896, Van Cleef & Arpels is a French luxury
jewelry company owned by Richemont Holdings Limited.
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Van Cleef & Arpels Collection Extraordinaire, Encens Précieux
the products
44
In July 2023, we closed a transaction agreement with Roberto
Cavalli, whereby an exclusive and worldwide license was granted
for the production and distribution of Roberto Cavalli brand
perfumes and fragrance related products. The license became
effective in July 2023 and will last for 6.5 years.
Roberto Cavalli scents are sophisticated, luxurious, and flam-
boyant, while Just Cavalli fragrances are designed to appeal to
contemporary, urban customers that are young or young at
heart. In addition to the two core lines, the house launched
the Roberto Cavalli Gold Collection, an ultra-premium fragrance
collection, in 2014. Cavalli fragrances are distributed globally,
with a concentration in Europe, the Middle East and the United
States. Additionally, we partnered with one of the top luxury
retailers and distributors in the Middle East, a concentrated
market for the brand, to further expand the brand.
We started shipping new, freshly produced goods in February
2024 and will be introducing our first signature flanker, Sweet Fe-
rocious, in the summer of 2024. Following that, we have planned
to release a Just Cavalli duo and a new collection of hair and
body mists.
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Roberto Cavalli Sweet Ferocious
46
In 2012, we entered into a 20-year worldwide license agreement
with Karl Lagerfeld B.V., the internationally renowned haute
couture fashion house, to create, produce and distribute fra-
grances under the Karl Lagerfeld brand.
Under the creative direction of the late Karl Lagerfeld, one
of the world’s most influential and iconic designers, the Lager-
feld Portfolio represents a modern approach to distribution,
an innovative digital strategy and a global 360 degree vision
that reflect the designer’s own style and soul. Karl Lagerfeld
created the first fragrance that bears his name in 1978, and that
legacy has expanded to include several growing multi-scent
collection, Les Parfums Matières, and more recently, Karl Cities,
a new collection featuring entries for New York, Paris, Ham-
burg, Tokyo and Vienna was unveiled. A new fragrance duo is
unveiling in 2024.
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Karl Lagerfeld Karl Ikonik
the products
48
In 2019, we entered into an exclusive, 11-year worldwide license
agreement with Kate Spade to create, produce and distribute
new perfumes and fragrance related products under the Kate
Spade brand which we distribute globally to department and
specialty stores and duty-free shops, as well as in Kate Spade
retail stores.
Since its launch in 1993 with a collection of six essential
handbags, Kate Spade has always stood for optimistic feminin-
ity. Today, the brand is a global life and style house with hand-
bags, ready-to-wear, jewelry, footwear, gifts, home décor and
more. Polished ease, thoughtful details and a modern, sophis-
ticated use of color—Kate Spade’s founding principles define
a unique style synonymous with joy. Under the vision of its
creative director, the brand continues to celebrate confident
women with a youthful spirit. Kate Spade is part of the Tapestry
house of brands.
Our first original scent, Kate Spade New York, debuted in
January 2021. We have continued to enrich the collection with
flankers, including Kate Spade Sparkle, and more recently, Kate
Spade Cherie.
INTERPARFUMS, INC. 2023 ANNUAL REPORT
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49
the products
Kate Spade Bloom
50
In June 2020, we entered into an exclusive, 5-year worldwide li-
cense agreement with a potential 5-year extension with Moncler
for the creation, development, and distribution of fragrances
under the Moncler brand.
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 ex-
treme demands of nature with those of city life.
Our first fragrance for the Moncler brand had a revolutionary
LED design, and the flask-shaped bottles of Moncler Pour Femme
and Moncler Pour Homme forged a powerful bond with the House
Moncler’s alpine roots and pioneering spirit. This playful and
unique innovation enables its owner to write a personalized note
that scrolls in red letters on the screen of the mirror bottle. In
March 2023, we launched Les Sommets Moncler and Home collec-
tions, exploring a rich, woody olfactory palette.
INTERPARFUMS, INC. 2023 ANNUAL REPORT
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51
Moncler Moncler Sunrise
52
In 2019, we entered into an exclusive, 10-year worldwide license
agreement with German luxury fashion house MCM for the cre-
ation, development and distribution of fragrances and fragrance
related products under the MCM brand. The agreement has a
4-year automatic renewal option, potentially extending the li-
cense until December 31, 2034.
MCM is a luxury lifestyle goods and fashion house founded
in 1976 with an attitude defined by the cultural Zeitgeist and its
German heritage with a focus on functional innovation, including
the use of cutting-edge techniques. Today, through its associa-
tion with music, art, travel and technology, MCM embodies the
bold, rebellious and aspirational. Always with an eye on the dis-
ruptive, the driving force behind MCM centers on revolutioniz-
ing classic design with futuristic materials. MCM’s millennial and
Gen Z audience is genderless, ageless, empowered and uncon-
strained by rules and boundaries.
Following through on our plan to develop extraordinary fra-
grances that capture the creative spirit of MCM, our first new
fragrance, MCM, was released during the first quarter of 2021
to great success. In 2023, we debuted our first ever men’s scent,
MCM Onyx, and have plans to enrich the fragrance line with ex-
tensions in 2024.
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53
the products
MCM Crush
54
In 2010, we entered into an exclusive 15-year worldwide license
agreement for the creation, development and distribution of
fragrances and fragrance related products under the Boucheron
brand. For over a century, since becoming the first jeweler to
open a boutique on Place Vendôme in 1893, Boucheron has em-
bodied very high-end creation, luxury and French know-how.
The mysterious and seductive collection of Boucheron fragranc-
es unquestionably continues this prestigious line of creations.
Boucheron’s legacy scents, Femme and Homme, and the leg-
endary Jaipur perfume form the foundation of brand sales. Our
team has enriched the portfolio with Quatre for men and wom-
en, a new men’s fragrance, Singulier, along with several special
editions, a growing collection of unique scents aptly named, La
Collection, and Serpent Bohème. Boucheron operates through
several boutiques worldwide as well as an e-commerce site.
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55
Boucheron Quatre Iconic
the products
56
In October 2021, we also entered into a 10-year exclusive global
licensing agreement with Emanuel Ungaro for the creation,
development and distribution of fragrances and fragrance-
related products, under the Emanuel Ungaro brand. Founded in
1965 in Paris, the house of Emanuel Ungaro is an icon of French
refinement and haute couture. Its unique style is expressed
through
unquestioning
sensuality,
purity
of
silhouette,
flamboyant prints, and exquisite attention to detail. Season
after season, Emanuel Ungaro dared to be different, combining
unexpected yet sensual clashes of bright colors and prints with
beautiful draping.
Ungaro fragrances uphold the same values of audacity and
elegance, and the brand is best known internationally, and such
presence will remain our sales focus as we continue to produce
and distribute the brand’s legacy scents, notably Diva. In 2023,
we unveiled an extension, Diva Rouge, and are launching a new
fragrance, Cosmic, in 2024.
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57
Emanuel Ungaro Cosmic
the products
58
In 2011, we entered into an exclusive worldwide fragrance
license to create, produce and distribute fragrances and fra-
grance related products under the Anna Sui brand. The Anna Sui
brand is mostly popular in Asia. Over the past decade, we have
worked in partnership with Anna Sui and her creative team to
build upon the brand’s customer appeal and develop and mar-
ket a family of fragrances including Fantasia, Sui Dreams, Sky, and
Sundae, a new three fragrance collection.
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59
the products
Anna Sui Sundae
60
In 2018, we entered into an exclusive, 8-year worldwide license
agreement with London-based Graff for the creation, develop-
ment and distribution of fragrances under the Graff brand. The
agreement has three 3-year automatic renewal options, poten-
tially extending the license until December 31, 2035.
Since Laurence Graff OBE founded the company in 1960,
Graff has been dedicated to sourcing and crafting diamonds and
gemstones of untold beauty and rarity and transforming them
into spectacular pieces of jewelry that move the heart and stir
the soul. Throughout its rich history, Graff has become the
world leader for diamonds of rarity, magnitude and distinction.
Each jewelry creation is designed and manufactured in Graff’s
London atelier, where master craftsmen employ techniques to
emphasize the beauty of each individual stone. The company
remains a family business, overseen by Francois Graff, Chief
Executive Officer.
For Graff, a six-scent collection for women, Lesedi La Rona,
debuted exclusively at Harrods, has now extended to only the
most exclusive, limited, ultra-high end retail outlets. New mem-
bers of the collection have been regularly added since the Lesedi
La Rona launch.
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61
Graff Lesedi La Rona III Parfum
the products
62
(in thousands)
Year Ended December 31,
2023
2022
2021
United States
$493,200 $410,000 $344,100
France
51,000
44,800
44,000
Russia
50,100
33,964
43,400
United Kingdom
47,500
37,900
38,500
CONSOLIDATED NET SALES TO CUSTOMERS
IN MAJOR COUNTRIES ARE AS FOLLOWS:
39%
7%
CONSOLIDATED NET SALES TO CUSTOMERS BY REGION
(in millions)
Year Ended December 31,
2023
2022
2021
North America
$511.7
$421.0
$346.9
Western Europe
301.2
259.2
202.0
Asia
191.8
163.6
135.2
Middle East
107.3
87.8
61.0
Eastern Europe
103.2
74.2
69.7
Central and
South America
92.7
69.9
56.4
Other
9.8
11.0
8.4
$1,317.7
$1,086.7
$879.6
INTERPARFUMS, INC. 2023 ANNUAL REPORT
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63
31%
8%
15%
64
All Corporate Functions:
Including product analysis and development, production and
sales, and finance are coordinated at the Company’s corpo-
rate headquarters in New York and at the corporate offic-
es of Interparfums SA in Paris. Each company is organized
into two operational units that report directly to general
management, and European operations ultimately report to
Mr. Benacin and United States operations ultimately report to
Mr. Madar.
Finance, Investor Relations
And Administration:
Michel Atwood in the United States and Philippe Santi in France:
• Financial policy and communication, investor relations;
• Financial accounting, cost accounting, budgeting and
cash flow management;
• Disclosure requirements of the Securities and Exchange
Commission and Commission des Operations de Bourse;
• Labor relations, tax and legal matters and management
information systems.
Operations:
Franck Moisio in the United States and Axel Marot in France:
• Product development;
• Logistics and transportation;
• Purchasing and industrial relations;
• Quality control and inventory cost supervision.
Export Sales:
Hervé Bouillonnec in the United States and Frédéric Garcia-
Pelayo and Stanislas Archambault in France:
• International development strategy;
• Establishment of distributor networks and negotiation of
contracts;
• Monitoring of profit margins and advertising expenditures.
Domestic (Home Country) Sales:
Hervé Bouillonnec in the United States and Jérôme Thermoz in
France:
• Establish and apply domestic sales strategy and
distribution policy;
• Sales team management and development;
• Monitoring of profit margins and advertising expenditures.
The
Organization
INTERPARFUMS, INC. 2023 ANNUAL REPORT
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65
SIMPLIFIED CHART OF THE ORGANIZATION
the organization
44%
56%
100%
INTER PARFUMS
HOLDINGS, SA
INTER PARFUMS,
USA LLC
INTER PARFUMS
ITALIA SRL
100%
PHILIPPE BENACIN
JEAN MADAR
PUBLIC
SHAREHOLDERS
72%
INTERPARFUMS SA
[ EURONEXT
- PARIS ]
100%
INTER PARFUMS,
USA
HONG KONG LTD
100%
INTER PARFUMS
MIDDLE EAST
DMCC
100%
INTER PARFUMS,
USA
SWISS SA
100%
100%
INTERPARFUMS
LUXURY BRANDS,
INC
100%
INTERPARFUMS
[ SUISSE ]
SARL
100%
INTERPARFUMS
SINGAPORE PTE,
LTD
PARFUMS
ROCHAS
SPAIN, SL
51%
US based Operations
European based Operations
66
INTERPARFUMS, INC. 2023 ANNUAL REPORT
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67
Interparfums Headquarters in Paris, 10 rue de Solférino
68
contents
management’s discussion and analysis of financial
condition and results of operations
report on internal control
over financial reporting
report of independent registered
public accounting firm
financial statements
notes to consolidated financial statements
corporate and market information
directors and executive officers
69
78
79
81
85
102
103
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69
Management’s Discussion
And Analysis Of
Financial Condition And
owners of the Abercrombie & Fitch, Anna Sui, Donna Karan, DKNY,
Emanuel Ungaro, Ferragamo, Graff, GUESS, Hollister, MCM, Oscar
de la Renta, and Roberto Cavalli brands.
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 re-
spect to the Company’s largest brands, we license the Jimmy
Choo, Montblanc, Coach, GUESS, Donna Karan/DKNY and Ferraga-
mo brand names. This diversified portfolio of top brands repre-
sented 73%, 71% and 66% of total sales in 2023, 2022, and 2021,
respectively.
As a percentage of net sales, product sales for the Company’s
largest brands were as follows:
Years ended December 31, 2023 2022 2021
Jimmy Choo
17%
18%
18%
Montblanc
17%
18%
19%
Coach
15%
15%
16%
GUESS
12%
12%
12%
Donna Karan/DKNY
7%
3%
-
Ferragamo
5%
5%
1%
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 re-
tailers, seasonality is more evident. We primarily sell directly to
retailers in France, the United States, and Italy.
We grow our business in two distinct ways. First, we grow by
adding new brands to our portfolio, through new licenses, or oth-
er arrangements or outright acquisitions of brands. Second, we
grow through the introduction of new products and by support-
ing new and established products through advertising, merchan-
dising and sampling, as well as by 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 oper-
ating performance each year. The 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 dis-
tribution 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.
OVERVIEW
We operate in the fragrance business, and manufacture, market
and distribute a wide array of prestige 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 market-
ed by our European based operations through our 72% owned
subsidiary in Paris, Interparfums SA, which is also a publicly
traded company as 28% of Interparfums SA shares trade on the
Euronext.
We produce and distribute our European based fragrance
products primarily under license agreements with brand own-
ers, and European based fragrance product sales represented
approximately 65%, 68% and 75% of net sales for 2023, 2022 and
2021, respectively. We have built a portfolio of prestige brands,
which include Boucheron, Coach, Jimmy Choo, Karl Lagerfeld, Kate
Spade, Lanvin, Moncler, Montblanc, Rochas, and Van Cleef & Arpels,
whose products are distributed in over 120 countries around
the world. In addition, our exclusive and worldwide license for
the production and distribution of Lacoste brand perfumes and
cosmetics became effective in January 2024.
Through our United States based operations, we also mar-
ket fragrances and fragrance related products. United States
based operations represented 35%, 32% and 25% of net sales in
2023, 2022 and 2021, respectively. These fragrance products are
sold primarily pursuant to license or other agreements with the
management’s discussion and analysis
of financial condition and results of operations
Results Of
Operations
70
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 im-
pact on our net sales. However, earnings are positively affected
by a strong dollar, because over 50% of net sales of our Euro-
pean based operations are denominated in U.S. dollars, while
almost all costs of our European based 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 ad-
dress 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.
IMPACT OF COVID-19 PANDEMIC
Please see our discussion of the Impact of the COVID-19
Pandemic, which is incorporated by reference to Note 2 to
the Consolidated Financial Statements contained in this 2023
Annual Report on Form 10-K filed with the SEC for the year
ended December 31, 2023.
RECENT IMPORTANT EVENTS
Please see our discussion of Recent Important Events, which is in-
corporated by reference to Note 3 to the Consolidated Financial
Statements contained in this 2023 Annual Report on Form 10-K
filed with the SEC for the year ended December 31, 2023.
DISCUSSION OF CRITICAL ACCOUNTING POLICIES
We make estimates and assumptions in the preparation of our
financial statements in conformity with accounting principles
generally accepted in the United States of America. Actual re-
sults could differ significantly from those estimates under dif-
ferent assumptions and conditions. We believe the following
discussion addresses our most critical accounting policies, which
are those that are most important to the portrayal of our fi-
nancial condition and results of operations. These accounting
policies generally require our management’s most difficult and
subjective judgments, often as a result of the need to make esti-
mates about the effect of matters that are inherently uncertain.
Management of the Company has discussed the selection of sig-
nificant accounting policies and the effect of estimates with the
Audit Committee of the Board of Directors.
Long-Lived Assets
We evaluate 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 unex-
pected 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 as-
sets for impairment, the evaluation requires a comparison of the
estimated fair value of the asset to the carrying value of the as-
set. The fair values used in our evaluations are estimated based
upon discounted future cash flow projections using a weighted
average cost of capital of 10.39%. 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 mod-
el or changes in consumer acceptance of our products which
are more subjective in nature. If the carrying value of an indefi-
nite-lived intangible asset exceeds its fair value, an impairment
charge is recorded.
We believe that the assumptions we have made in projecting
future cash flows for the evaluations described above are reason-
able. However, if future actual results do not meet our expecta-
tions, we may be required to record an impairment charge, the
amount of which could be material to our results of operations.
At December 31, 2023 indefinite-lived intangible assets ag-
gregated $108.8 million. The following table presents the impact
a change in the following significant assumptions would have had
on the calculated fair value in 2023 assuming all other assump-
tions remained constant:
Increase
(decrease)
$ in millions Change to fair value
Weighted average cost of capital +10% $4.4
Weighted average cost of capital -10% $31.8
Future sales levels +10% $33.3
Future sales levels -10% $7.5
Intangible assets subject to amortization are evaluated for im-
pairment testing whenever events or changes in circumstances in-
dicate that the carrying amount of an amortizable intangible asset
may not be recoverable. If impairment indicators exist for an amor-
tizable intangible asset, the undiscounted future cash flows associ-
ated 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 undis-
counted future cash flows is less than the carrying value of the in-
INTERPARFUMS, INC. 2023 ANNUAL REPORT
INTERPARFUMS, INC. 2023 ANNUAL REPORT
71
tangible asset, an impairment charge would be recorded to reduce
the intangible asset to its fair value. 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. In those cases where we determine that the useful life
of long-lived assets should be shortened, we would amortize the
net book value in excess of the salvage value (after testing for im-
pairment as described above), over the revised remaining useful life
of such asset thereby increasing amortization expense. We believe
that the assumptions we have made in projecting future cash flows
for the evaluations described above are reasonable.
In determining the useful life of our Lanvin brand names and
trademarks, we applied the provisions of ASC topic 350-30-
35-3. The only factor that prevented us from determining that
the Lanvin brand names and trademarks were indefinite lived
intangible assets was Item c. “Any legal, regulatory, or contrac-
tual provisions that may limit the useful life.” The existence of a
repurchase option originally in 2025 and amended to 2027, may
limit the useful life of the Lanvin brand names and trademarks to
the Company. However, this limitation would only take effect if
the repurchase option were to be exercised and the repurchase
price was paid. If the repurchase option is not exercised, then the
Lanvin brand names and trademarks are expected to continue to
contribute directly to the future cash flows of our Company and
their useful life would be considered to be indefinite.
With respect to the application of ASC topic 350-30-35-8,
the Lanvin brand names and trademarks would only have a finite
life to our Company if the repurchase option were exercised,
and in applying ASC topic 350-30-35-8, we assumed that the
repurchase option is exercised. When exercised, Lanvin has an
obligation to pay the exercise price and the Company would
be required to convey the Lanvin brand names and trademarks
back to Lanvin. The exercise price to be received (residual val-
ue) is well in excess of the carrying value of the Lanvin brand
names and trademarks, therefore no amortization is required.
Quantitative Analysis
During the three-year period ended December 31, 2023, we
have not made any material changes in our assumptions underly-
ing these critical accounting policies or to the related significant
estimates. The results of our business underlying these assump-
tions have not differed significantly from our expectations.
While we believe the estimates we have made are proper and
the related results of operations for the period are presented
fairly in all material respects, other assumptions could reasonably
be justified that would change the amount of reported net sales,
cost of sales, and selling, general and administrative expenses as
they relate to the provisions for anticipated sales returns, allow-
ance for doubtful accounts and inventory obsolescence reserves.
For 2023, had these estimates been changed simultaneously by
5% in either direction, our reported gross profit would have in-
creased or decreased by approximately $0.7 million and selling,
general and administrative expenses would have changed by ap-
proximately $0.1 million. The collective impact of these changes
on 2023 operating income, net income attributable to Inter Par-
fums, Inc., and net income attributable to Inter Parfums, Inc. per
diluted share would be an increase or decrease of approximately
$0.6 million, $0.3 million and $0.01, respectively.
management’s discussion and analysis
of financial condition and results of operations
RESULTS OF OPERATIONS
Net Sales
(in millions)
Years Ended December 31,
2023
% Change
2022
% Change
2021
European based product sales
$861.9
16%
$744.0
12%
$663.2
United States based product sales
455.8
33%
342.7
58%
216.4
Total net sales
$1,317.7
21%
$1,086.7
24%
$879.6
Net sales in 2023 increased 21% compared to 2022. At comparable foreign currency exchange rates, net sales increased 20% in 2023,
as compared to 2022, of which 5% is related to new brands. The average dollar/euro exchange rate for 2023 was 1.08 compared to
1.05 in 2022.
For European based operations, our largest brands, Jimmy Choo, Montblanc, and Coach grew 2023 sales by 19%, 15% and 25%,
respectively, as compared to 2022. There were also significant gains made by our mid-sized brands, including Van Cleef & Arpels, Ro-
chas, and Karl Lagerfeld. The year-over-year gains, in both euro and dollars, are all the more impressive considering our new product
pipeline was dominated by flankers and extensions. The increase was also driven by the continued success of our established lines
including Jimmy Choo I Want Choo, Montblanc Legend, Coach Woman, and Coach Man.
72
Sales by our United States based operations grew substantially
in 2023, up 33%, as compared to 2022, largely from the continued
success of GUESS fragrances, which performed exceedingly well
during the quarters across all geographies, and was up 23% in 2023
as compared to 2022. This was driven by the continued growth
in sales of the Seductive line within GUESS. The increase was also
driven by the addition and extension of Donna Karan and DKNY to
our portfolio. These two sister fragrance groups have climbed to
become our second largest United States based brand in just one
year under our expertise. We also had strong sales of Ferragamo
fragrances, which we have enriched with sister scents for the Signo-
rina and Storie di Seta collections. There were also gains made by
our mid-sized brands, Oscar de la Renta Abercrombie & Fitch, and
Hollister. In the second half of the year, we successfully completed
Phase 1 of the Abercrombie & Fitch Fierce distribution roll-out.
We are confident in our future as 2024 has many exciting de-
velopments for the Company. We transitioned to a new mod-
ern enterprise resource planning system (“ERP”) for our United
States based operations, which has enabled us to operate more
efficiently and offer more scale to absorb our newer brands. Dis-
tribution of Roberto Cavalli and Lacoste products, our newly
acquired licenses, have begun in the first quarter. A new block-
buster fragrance line for Lacoste, and a new flanker for Roberto
Cavalli Signature are planned to launch in the second half of 2024.
We also have a solid line-up of new product launches in the pipe-
line for many of our existing brands. This includes the Phase 2
distribution roll-out of Abercrombie & Fitch Fierce in the first
quarter, a roll out of the Donna Karan Cashmere Collection in
the first quarter, a new DKNY blockbuster in the third quarter,
a launch of a new GUESS fragrance in the second quarter, as
well as an Uomo flanker in the third quarter. Extensions of Jimmy
Choo I Want Choo, Montblanc Legend, and Coach Dreams, are set
to debut throughout the year. Brand extensions and flankers are
also in the works for Ferragamo, MCM, Abercrombie & Fitch,
Hollister, Anna Sui, Emanuel Ungaro, and Oscar de la Renta. In
sum, 2024 has all the earmarks of another strong year as the
growth catalysts, such as the rebound of the travel retail busi-
ness in Asia, currently far outweigh the headwinds, most notably
supply chain disruptions that have largely abated.
As in the past, we hope to benefit from our strong financial po-
sition to potentially acquire one or more brands, either on a pro-
prietary basis or as a licensee. However, we have no certainty that
any new license or acquisition agreements will be consummated.
Net Sales To Customers By Region
(in millions)
Year Ended December 31,
2023
2022
2021
North America
$511.7
$421.0
$346.9
Western Europe
301.2
259.2
202.0
Asia
191.8
163.6
135.2
Middle East
107.3
87.8
61.0
Eastern Europe
103.2
74.2
69.7
Central and
South America
92.7
69.9
56.4
Other
9.8
11.0
8.4
$1,317.7
$1,086.7
$879.6
Our largest market, North America, achieved sales growth of
22% in 2023 compared to 2022, followed by Western Europe
and Asia where sales grew by 16% and 17% in 2023, respectively,
compared to 2022. Middle East, Eastern Europe, and Central and
South America also achieved top line growth of 22%, 39% and 33%
in 2023, respectively, compared to 2022. Additionally, our travel
retail business is continuing to show signs of renewed life.
Gross Profit Margins
(in millions)
Year Ended December 31,
2023
2022
2021
European based operations
Net sales
$861.9
$744.0
$663.2
Cost of sales
282.6
236.9
221.2
Gross margin
$579.3
$507.1
$442.0
Gross margin, as a percent of net sales
67.2%
68.2%
66.6%
United States based operations
Net sales
$455.8
$342.7
$216.4
Cost of sales
196.0
155.4
101.5
Gross margin
$259.8
$187.3
$114.9
Gross margin, as a percent of net sales
57.0%
54.7%
53.1%
INTERPARFUMS, INC. 2023 ANNUAL REPORT
INTERPARFUMS, INC. 2023 ANNUAL REPORT
73
percentage of net sales was 67.2%, 68.2% and 66.6% in 2023,
2022 and 2021, respectively. We carefully monitor movements
in foreign currency exchange rates as over 50% of our European
based operations net sales is denominated in U.S. dollars, while
most of our costs are incurred in euro. From a margin stand-
point, a strong U.S. dollar has a positive effect on our gross
margin while a weak U.S. dollar has a negative effect. The av-
erage dollar/euro exchange rate was 1.08 in 2023, 1.05 in 2022,
and 1.18 in 2021. The weaker dollar in 2023 resulted in a decline
in our gross margin. This decline was partially offset as distri-
bution in the United States for European based operations is
handled by a 100% owned subsidiary of Interparfums SA based
in the United States. Therefore, sales are made at a wholesale
price rather than at an ex-factory price, resulting in higher gross
margins. Net sales of our United States based distribution sub-
sidiary increased 14% in 2023, as compared to 2022, leading
to favorable mix and helping to further offset the gross margin
decline. The decline was also driven by an increase in inventory
reserves made during 2023 related to certain underperforming
brands. As the Company experienced long lead times in obtain-
ing and building inventory during the COVID-19 Pandemic, high
levels of inventory investments were required to protect ser-
vice levels. Excluding these one-time adjustments, gross margin
as a percentage of sales for European based operations would
be in line with the prior period, driven by increases in pricing
and product mix, offset by cost inflation.
For United States based operations, gross profit margin was
57.0%, 54.7% and 53.1% in 2023, 2022 and 2021, respectively.
The significant margin expansion stems from a number of fac-
tors. Firstly, for the most part, the price increases we took in
early 2023 weren’t fully offset by a higher cost of goods given
our cost containment efforts. Secondly, we are seeing favor-
able brand and channel mix, as a larger portion of our higher
priced fragrances are being sold directly to retailers as opposed
to third-party distributors. Lastly, the significant increase in
sales in 2023 allowed us to better absorb fixed expenses such
as depreciation and point of sale expenses, as compared to the
prior year.
Costs relating to purchase with purchase and gift with pur-
chase promotions are reflected in cost of sales, and aggregated
management’s discussion and analysis
of financial condition and results of operations
The Company’s gross margin percentage was 63.7% in 2023 as
compared to 63.9% in 2022. The slight decrease in gross margin
percentage was driven by unfavorable segment mix as well as
certain one-time expenses related to inventory as discussed fur-
ther below. Overall, the Company’s pricing actions have broadly
compensated for cost inflation impacts.
For European based operations, gross profit margin as a
$52.3 million, $43.1 million and $36.9 million in 2023, 2022 and
2021, respectively, and represented 4.0%, 4.0% and 4.2% of net
sales, respectively.
Generally, we do not bill customers for shipping and handling
costs and such costs, which aggregated $14.2 million, $15.8 mil-
lion and $10.0 million in 2023, 2022 and 2021, respectively, are
included in selling, general and administrative expenses in the
consolidated statements of income. As such, our Company’s
gross margins may not be comparable to other companies, which
may include these expenses as a component of cost of sales.
Selling, General
& Administrative Expenses
(in millions)
Years ended December 31,
2023 2022 2021
European Operations
Selling, general
& administrative expenses
$406.6
$358.3
$327.5
Selling, general
& administrative expenses
as a percent of net sales
47.2% 48.2% 49.4%
United States Operations
Selling, general
& administrative expenses
$181.1
$134.0
$79.0
Selling, general
& administrative expenses
as a percent of net sales
39.7% 39.1% 36.5%
The Company’s selling, general and administrative expenses as
a percentage of nets sales were 44.6%, 45.3% and 46.2% in 2023,
2022 and 2021, respectively. This decrease was largely driven by
sales growth during 2023 and 2022 allowing for better absorption
of fixed operating costs, and favorable segment mix.
For European based operations, selling, general and admin-
istrative expenses increased 13% and 9% in 2023 and 2022, re-
spectively, as compared to the corresponding prior year period,
and represented 47.2%, 48.2% and 49.4% of net sales in 2023,
2022 and 2021, respectively. As discussed in more detail below,
these fluctuations, which are in line with the fluctuations in sales
for European operations, are primarily from variations in promo-
tion and advertising expenditures. For United States based op-
erations, selling, general and administrative expenses increased
35% and 70% in 2023 and 2022, respectively, as compared to the
corresponding prior year period and represented 39.7%, 39.1%
and 36.5% of net sales in 2023, 2022 and 2021, respectively. As
discussed in more detail below, these fluctuations, which are in
line with the fluctuations in sales for United States based operations,
74
the Company entered into a $55.3 million (€50 million) four-
year loan agreement. The loan agreement bears interest at
EURIBOR-1 month rates plus a margin of 0.825%. This variable
rate debt was swapped for variable interest rate debt with a
maximum rate of 2% per annum. Additionally, in April 2021, we
completed the acquisition of the headquarters of Interparfums
SA. The acquisition was financed by a 10-year approximately
$132.6 million (€120 million) bank loan which bears interest at
one-month Euribor plus 0.75%. Approximately $88.4 million
(€80 million) of the variable rate debt was swapped for fixed
interest rate debt with a maximum interest rate of 2% per an-
num. The swap effectively exchanges the variable interest rate
to a fixed rate of approximately 1.1%. Long-term debt including
current maturities aggregated $157.5 million, $180.0 million
and $148.8 million as of December 31, 2023, 2022 and 2021,
respectively.
We enter into foreign currency forward exchange contracts
to manage exposure related to receivables from unaffiliated
third parties denominated in a foreign currency and occasion-
ally to manage risks related to future sales expected to be de-
nominated in a foreign currency. Over 50% of net sales of our
European based operations are denominated in U.S. dollars.
Gains and losses in derivatives designated as hedges are accu-
mulated in other comprehensive income and gains and losses in
derivatives not designated as hedges are included in (gain) loss
on foreign currency on the accompanying consolidated income
statements. Such gains and losses were immaterial in each 2023,
2022, and 2021.
Interest and investment income represents interest earned
on cash and cash equivalents and short-term investments. As
of December 31, 2023, short-term investments include approx-
imately $9.4 million of marketable equity securities of other
companies in the luxury goods sector. In the first quarter of
2023, the Company sold marketable securities which generat-
ed a gain of $3.1 million. The Company purchased additional
marketable securities in the second and third quarter of 2023,
which generated unrealized losses of $0.3 million during 2023.
Overall the increases in interest rates led to higher net interest
expenses. These increases in interest expense combined with
losses on foreign currency were partially offset by the gains on
marketable securities.
Income Taxes
Our consolidated effective tax rate was 24.8%, 22.2% and 27.1%
in 2023, 2022 and 2021, respectively.
The effective tax rate for European based operations was
27.3%, 25.2% and 30.6% in 2023, 2022 and 2021, respectively.
are primarily from variations in promotion and advertising ex-
penditures. Additionally, the United States based operations
increased expenses related to salaries and benefits as we build
the organization and infrastructure to support our new brands
and future growth. The increase related to these structural and
personnel investments began throughout 2022 and had full year
impact in 2023 of $7.8 million.
Promotion and advertising included in selling, general and ad-
ministrative expenses aggregated $259.9 million, $212.4 million
and $171.1 million in 2023, 2022 and 2021, respectively. Pro-
motion and advertising represented 19.7%, 19.5% and 19.5% of
net sales in 2023, 2022 and 2021, respectively. Promotion and
advertising are integral parts of our industry, and we continue
to invest heavily to support new product launches and to build
brand awareness. We believe that our promotion and advertis-
ing efforts have had a beneficial effect on sales. All of our brands
have benefitted from newly launched and enhanced e-commerce
sites in existing markets in collaboration with our retail custom-
ers on their e-commerce sites. We also continue to develop
and implement omnichannel concepts and compelling content
to deliver an integrated consumer experience. Long term, we
anticipate that on a full year basis, promotion and advertising
expenditures should aggregate approximately 21% of net sales,
which is in line with pre-COVID historical averages.
Royalty expense included in selling, general and administrative
expenses aggregated $103.8 million, $87.0 million and $68.9 mil-
lion in 2023, 2022 and 2021, respectively. Royalty expense repre-
sented 7.9%, 8.0% and 7.8% of net sales in 2023, 2022 and 2021,
respectively, due to changes in brand mix.
Service fees, which are fees paid within our European based
operations to third parties relating to the activities of our distri-
bution subsidiaries, aggregated $11.0 million, $7.9 million and $9.4
million in 2023, 2022 and 2021, respectively. The amounts are in
line with and directly related to fluctuations in sales within our
U.S. distribution subsidiary.
Income from Operations
As a result of the above analysis regarding net sales, gross profit
margins and selling, general and administrative expenses, our
operating margins aggregated 19.1%, 17.9% and 16.8% for the
years ended December 31, 2023, 2022 and 2021, respectively.
Other Income and Expenses
Interest expense is primarily related to the financing of brand
and licensing acquisitions. The increase in interest expense
in 2023 is related to prior year acquisitions. In December
2022, to finance the acquisition of the Lacoste trademark,
INTERPARFUMS, INC. 2023 ANNUAL REPORT
INTERPARFUMS, INC. 2023 ANNUAL REPORT
75
Net Income
(In thousands)
Years ended December, 31
2023
2022
2021
Net income attributable to European based operations
123,994
$107,292
$80,670
Net income attributable to United States based operations
63,782
43,745
29,357
Net income
187,776
151,037
110,027
Less: Net income attributable to the noncontrolling interest
35,122
30,099
22,616
Net income attributable to Inter Parfums, Inc.
$152,654
$120,938
$87,411
Net income attributable to Inter Parfums, Inc. was $152.7 million, $120.9 million and $87.4 million in 2023, 2022 and 2021, respectively.
Net income attributable to European based operations was $124.0 million, $107.3 million and $80.7 million in 2023, 2022 and
2021, respectively, while net income attributable to United States based operations was $63.8 million, $43.7 million and $29.4
million in 2023, 2022 and 2021, respectively. The significant fluctuations in net income for both European and United States based
operations are directly related to the previous discussions relating to changes in sales, gross profit margins, selling, general and
administrative expenses.
The noncontrolling interest arises from our 72% owned subsidiary in Paris, Interparfums SA, which is also a publicly traded com-
pany as 28% of Interparfums SA shares trade on the Euronext. Net income attributable to the noncontrolling interest is directly
related to the profitability of our European based operations and aggregated 28.1%, 27.9% and 28.0% of European based operations
net income in 2023, 2022 and 2021, respectively. Net profit margins attributable to Inter Parfums, Inc. aggregated 11.6%, 11.1% and
9.9% in 2023, 2022 and 2021, respectively.
LIQUIDITY AND CAPITAL RESOURCES
Our conservative financial tradition has enabled us to amass significant cash balances. As of December 31, 2023, we had $182.8 million in
cash and cash equivalents and short-term investments, most of which are held in euro by our European based 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. As of December 31, 2023, short-term investments include approximately $12.9 million of
marketable equity securities.
As of December 31, 2023, working capital aggregated $514 million, and we had a working capital ratio of 2.6 to 1. Approximately
78% of the Company’s total assets are held by European based operations, and approximately $255 million of trademarks, licenses
and other intangible assets are also held by European based operations.
The Company is party to a number of licenses and other agreements for the use of trademarks and rights in connection with
management’s discussion and analysis
of financial condition and results of operations
The French Government voted the reduction of the French
corporate income tax rate from approximately 33% to 25%
over a three-year period resulting in the decrease in rate from
2021 to 2022. Our effective tax rate in 2023 differs from the
25% statutory rate due to a one-time tax assessment of € 2.8
million ($3.1 million) included in tax expense as the result of a
tax audit conducted for the 2020 and 2021 tax years.
The effective tax rate for United States based operations
was 19.3%, 13.8% and 15.6% in 2023, 2022 and 2021, respec-
tively. 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 tax-
es. Additionally, in the third quarter of 2022, our United States
based operations recognized a one-time tax benefit of $2.5 mil-
lion associated with the 2021 Salvatore Ferragamo acquisition.
At the time of the acquisition, we had not recognized deferred
tax benefits as there were uncertainties concerning its potential
recoverability; however, as of September 30, 2022, recoverabili-
ty was deemed likely. Other than as discussed above, we did not
experience any significant changes in tax rates, and none were
expected in the jurisdictions where we operate.
The Company has determined that it has no tax liability related
to global intangible low-taxed income (“GILTI”) as of December
31, 2023, 2022 and 2021. The Company also estimated the effect
of its foreign derived intangible income (“FDII”) and recorded a
tax benefit of $2.4 million, $1.5 million and $0.6 million as of De-
cember 31, 2023, 2022 and 2021, respectively. Share-based com-
pensation resulted in a discrete tax benefit of $1.2 million, $0.8
million and $1.3 million in 2023, 2022 and 2021, respectively.
76
the manufacture and sale of its products expiring at various
dates through 2039. In connection with most of these license
agreements, the Company is subject to minimum annual adver-
tising commitments, minimum annual royalties and other com-
mitments. See Item 8. Financial Statements and Supplementary
Data – Note 12 – Commitments in this annual report on Form
10-K. Future advertising commitments are estimated based on
planned future sales for the license terms that were in effect at
December 31, 2023, without consideration for potential renew-
al periods and do not reflect the fact that our distributors share
our advertising obligations.
The Company hopes to continue to benefit from its strong
financial position to potentially acquire one or more brands, ei-
ther on a proprietary basis or as a licensee. In July 2023, we
entered into a global licensing agreement for the creation, de-
velopment and distribution of fragrances and fragrance-related
products under the Roberto Cavalli brand. Our rights under
this license are subject to certain minimum advertising expen-
ditures and royalty payments as are customary in our industry.
This license took effect in July 2023, and began shipping prod-
ucts in February 2024.
In December 2022, we entered into a long-term global licens-
ing agreement for the creation, development and distribution
of fragrances and fragrance-related products under the Lacoste
brand. Our rights under this license are subject to certain min-
imum advertising expenditures and royalty payments as are
customary in our industry. This new license took effect and
products have started to ship in January 2024.
In September 2021, we entered into a long-term global licens-
ing agreement for the creation, development and distribution
of fragrances and fragrance-related products under the Donna
Karan and DKNY brands. Our rights under this license are sub-
ject to certain minimum advertising expenditures and royalty
payments as are customary in our industry. With this agree-
ment, we gained several well-established and valuable fragrance
franchises, most notably Donna Karan Cashmere Mist and DKNY
Be Delicious, as well as a significant loyal consumer base around
the world. The exclusive license became effective on July 1,
2022, and we are planning to launch new fragrances under these
brands in 2024.
In October 2021, we closed a transaction agreement with
Salvatore Ferragamo S.p.A., whereby an exclusive and world-
wide license was granted for the production and distribution
of Ferragamo brand perfumes. The license became effective
in October 2021 and will last for 10 years with a 5-year op-
tional term, subject to certain conditions. With respect to
the management and coordination of activities related to the
license agreement, the Company is operating through a whol-
ly-owned Italian subsidiary based in Florence, that was acquired
from Salvatore Ferragamo on October 1, 2021. The acquisition
together with the license agreement was accounted for as an
asset acquisition. The total cost of the assets acquired net of
liabilities assumed aggregated approximately $35.8 million. In
connection with this acquisition, we agreed to pay $17.0 million
in equal annual installments of $1.7 million including interest
imputed at 2.0%.
Cash provided by operating activities aggregated $105.8 mil-
lion, $73.0 million, and $119.6 million in 2023, 2022 and 2021,
respectively. In 2023, working capital items used $102.0 million
in cash from operating activities, as compared to $107.7 mil-
lion in 2022 and $13.7 million in 2021. Although, from a cash
flow perspective, accounts receivable is up 19% from year-end
2022, the balance is reasonable based 2023 record sales levels
and reflects a strong collection activity as day’s sales outstand-
ing decreased slightly to 60 days in 2023, as compared to 64
days and 61 days in 2022 and 2021, respectively. From a cash
flow perspective, inventory levels are up 25% from year-end
2022. Inventory days on hand increased to 249 days in 2023,
as compared to 231 days in 2022, and 208 days in 2021 as we
have built up inventory related to the newly acquired licenses
for Lacoste and Roberto Cavalli which began shipping to cus-
tomers in 2024.
Cash flows provided by investing activities in 2023 reflect
the purchases and sales of short-term investments. These in-
vestments consist of certificates of deposit with maturities
greater than three months, marketable equity securities and
other contracts. At December 31, 2023, approximately $2.2
million of certificates of deposit contain penalties where we
would forfeit a portion of the interest earned in the event of
early withdrawal.
Furthermore, in December 2023, the second installment
payment to Lacoste related to the acquisition of the Lacoste
trademark in 2022 for $43.3 million (€40 million) was made.
Our business is not capital intensive as we do not own any
manufacturing facilities. On a full year basis, we typically spend
approximately $5.0 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.
Cash flows used in financing activities in 2023 reflect issu-
ances and repayment of debt, purchases of treasury shares, and
payment of dividends to stockholders.
In December 2022, to finance Interparfums SA’s acquisi-
tion of the Lacoste trademark, Interparfums SA entered into
INTERPARFUMS, INC. 2023 ANNUAL REPORT
INTERPARFUMS, INC. 2023 ANNUAL REPORT
77
management’s discussion and analysis
of financial condition and results of operations
an approximately $55.3 million (€50 million) four-year loan
agreement. The loan agreement bears interest at EURIBOR-1
month rates plus a margin of 0.825%. This variable rate debt
was swapped for variable interest rate debt with a maximum
rate of 2% per annum.
In April 2021, Interparfums SA completed the acquisition of
its headquarters at 10 rue de Solférino in the 7th arrondisse-
ment of Paris from the property developer. This is an office
complex combining three buildings connected by two inner
courtyards, and consists of approximately 40,000 total sq. ft.
The $142 million purchase price is in line with market value and
includes the complete renovation of the site. As of December
31, 2023, $154 million of the purchase price, including approx-
imately $3.1 million of acquisition costs, is included in building,
equipment and leasehold improvements on the accompanying
consolidated balance sheet. As of December 31, 2023, there
was no cash held in escrow included in property, equipment
and leasehold improvements on the accompanying consolidated
balance sheet. In addition, Interparfums SA borrowed $17.0 mil-
lion pursuant to a short-term loan equal to the VAT credit, and
in July 2021, the $17.0 million VAT credit was reimbursed by the
French Tax Authorities and the loan was repaid. The acquisition
was financed by a 10-year €120 million (approximately $132.6
million) bank loan which bears interest at one-month Euribor
plus 0.75%. Approximately €80 million of the variable rate debt
was swapped for variable interest rate debt with a maximum
rate of 2% per annum. The swap effectively exchanges the vari-
able interest rate to a fixed rate of approximately 1.1%.
Our short-term financing requirements are expected to be
met by available cash on hand at December 31, 2023, and by
short-term credit lines provided by domestic and foreign banks.
The principal credit facilities for 2023 consist of a $25.0 mil-
lion unsecured revolving line of credit provided by a domestic
commercial bank and approximately $8 million in credit lines
provided by a consortium of international financial institutions.
Balances due from short-term borrowings totaled $4.4 million
and $0 million as of December 31, 2023 and 2022, respectively.
In December 2022, our Board of Directors authorized a
share repurchase program for our outstanding common stock.
During 2023, the Company repurchased 116,860 shares at a
cost of $15.4 million. These shares are classified as treasury
shares on the accompanying consolidated balance sheet. In Feb-
ruary 2024, our Board of Directors authorized the Company to
continue repurchasing up to 130,000 shares throughout 2024.
In February 2021, our Board of Directors authorized an an-
nual dividend of $1.00 per share, payable quarterly. In February
2022, our Board of Directors authorized a 100% increase in
the annual dividend to $2.00 per share and in February 2023
the Board of Directors increased the annual dividend to $2.50
per share. Just recently, in February 2024, the Board of Direc-
tors further increased the annual dividend to $3.00 per share.
The next quarterly cash dividend of $0.75 per share is payable
on March 29, 2024, to shareholders of record on March 15,
2024. Dividends paid, including dividends paid once per year
to noncontrolling stockholders of Interparfums SA, aggregat-
ed $100.3 million, $79.8 million and $41.5 million for the years
ended December 31, 2023, 2022 and 2021, respectively. The
cash dividends to be paid in 2024 are not expected to have any
significant impact on our financial position.
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 re-
sources 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 year ended December 31, 2023 as they were either off-
set by price increases we passed onto our respective custom-
ers or operating efficiencies.
ITEM 7A. QUANTITATIVE AND QUALITATIVE
DISCLOSURES ABOUT MARKET RISK.
General
We address certain financial exposures through a controlled
program of risk management that primarily consists of the use of
derivative financial instruments. We primarily enter into foreign
currency forward exchange contracts in order to reduce the
effects of fluctuating foreign currency exchange rates. We do
not engage in the trading of foreign currency forward exchange
contracts or interest rate swaps.
Foreign Exchange Risk Management
We periodically enter into foreign currency forward exchange
contracts to hedge exposure related to receivables denominat-
ed in a foreign currency and to manage risks related to future
sales expected to be denominated in a currency other than our
functional currency. We enter into these exchange contracts for
periods consistent with our identified exposures. The purpose
of the hedging activities is to minimize the effect of foreign ex-
change rate movements on the receivables and cash flows of
Interparfums SA, whose functional currency is the euro. All for-
eign currency contracts are denominated in currencies of ma-
jor industrial countries and are with large financial institutions,
which are rated as strong investment grade.
78
for either of the past two years contained an adverse opinion
or a disclaimer of opinion, or was qualified or modified as to
uncertainty, audit scope, or accounting principles was qualified
or modified as to uncertainty, audit scope, or accounting princi-
ples. During the Company’s two most recent fiscal years and any
subsequent interim period preceding June 1, 2024, there were
no disagreements with Mazars on any matter of accounting prin-
ciples or practices, financial statement disclosure, or auditing
scope or procedure, which disagreement(s), if not resolved to
the satisfaction of Mazars, would have caused it to make refer-
ence to the subject matter of the disagreement(s) in connection
with its report.
MANAGEMENT’S ANNUAL REPORT
ON INTERNAL CONTROL OVER FINANCIAL REPORTING
The management of Inter Parfums, Inc. is responsible for estab-
lishing and maintaining adequate internal control over financial
reporting as defined in Rule 13(a)-15(f) under the Securities
Exchange Act of 1934. With the participation of the Chief
Executive Officer and the Chief Financial Officer, our man-
agement conducted an evaluation of the effectiveness of our
internal control over financial reporting based on the frame-
work and criteria established in Internal Control – Integrated
Framework (2013), issued by the Committee of Sponsoring
Organizations of the Treadway Commission. Based on this
evaluation, our management has concluded that our internal
control over financial reporting was effective as of December
31, 2023.
Our independent auditor, Mazars USA LLP, a registered pub-
lic accounting firm, has issued its report on its audit of our in-
ternal control over financial reporting. This report appears on
the following page.
report on internal control
over financial reporting
All derivative instruments are required to be reflected as
either assets or liabilities in the balance sheet measured at fair
value. Generally, increases or decreases in fair value of de-
rivative instruments will be recognized as gains or losses in
earnings in the period of change. If the derivative is designated
and qualifies as a cash flow hedge, then the changes in fair value
of the derivative instrument will be recorded in other compre-
hensive income.
Before entering into a derivative transaction for hedging
purposes, we determine that the change in the value of the
derivative will effectively offset the change in the fair value of
the hedged item from a movement in foreign currency rates.
Then, we measure the effectiveness of each hedge throughout
the hedged period. Any hedge ineffectiveness is recognized in
the income statement.
As of December 31, 2023, we had foreign currency contracts
in the form of forward exchange contracts of approximately U.S.
$61.0 million and GB £2.5 million with maturities of less than one
year. We believe that our risk of loss as the result of nonperfor-
mance by any of such financial institutions is remote.
Interest Rate Risk Management
We mitigate interest rate risk by monitoring interest rates,
and then determining whether fixed interest rates should be
swapped for floating rate debt, or if floating rate debt should be
swapped for fixed rate debt.
Changes in Registrant’s Certifying Accountant
Inter Parfums, Inc. (the “Company”) was notified that Mazars
USA LLP (“Mazars”), the Company’s independent registered
public accounting firm, entered into a transaction with FORVIS,
LLP (“FORVIS”) whereby substantially all of the partners and
employees of Mazars joined FORVIS. As a result on the effec-
tive date of June 1, 2024, FORVIS changed its name to Forvis
Mazars, LLP, and Mazars resigned as the Company’s indepen-
dent registered public accounting firm. The Audit Committee
of the Company’s Board of Directors has appointed Forvis
Mazars, LLP to serve as the Company’s independent registered
public accounting firm effective June 1, 2024.
During the past two fiscal years and through June 1, 2024,
there were no adverse opinions or disclaimer of opinion issued
by Mazars, and no Mazars’s report on the financial statements
Michel Atwood
Chief Financial Officer
Jean Madar
Chief Executive Officer,
Chairman of the
Board of Directors
INTERPARFUMS, INC. 2023 ANNUAL REPORT
INTERPARFUMS, INC. 2023 ANNUAL REPORT
79
REPORT OF INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM
To Shareholders and
the Board of Directors of Inter Parfums, Inc.
Opinions on the Financial Statements
and Internal Control over Financial Reporting
We have audited the accompanying consolidated balance sheets
of Inter Parfums, Inc. (the “Company”) as of December 31, 2023
and 2022, and the related consolidated statements of income,
comprehensive income, shareholders’ equity, and cash flows
for each of the years in the three-year period ended December
31, 2023, and the related notes and the schedule listed in the
Index in Item 15(a)(2) (collectively referred to as the “financial
statements”). We also have audited the Company’s internal con-
trol over financial reporting as of December 31, 2023, based on
criteria established in Internal Control - Integrated Framework:
(2013) issued by the Committee of Sponsoring Organizations of
the Treadway Commission (COSO).
In our opinion, the consolidated financial statements referred
to above present fairly, in all material respects, the financial posi-
tion of the Company as of December 31, 2023 and 2022, and the
results of its operations and its cash flows for each of the years in
the three-year period ended December 31, 2023, in conformity
with accounting principles generally accepted in the United States
of America. Also in our opinion, the Company maintained, in all
material respects, effective internal control over financial report-
ing as of December 31, 2023, based on criteria established in In-
ternal Control - Integrated Framework: (2013) issued by COSO.
Basis for Opinion
The Company’s management is responsible for these consolidated
financial statements, for maintaining effective internal control over
financial reporting, and for its assessment of the effectiveness of
internal control over financial reporting included in the accom-
panying Management’s Annual Report on Internal Control over
Financial Reporting. Our responsibility is to express an opinion on
the Company’s consolidated financial statements and an opinion
on the Company’s internal control over financial reporting based
on our audits. We are a public accounting firm registered with
the Public Company Accounting Oversight Board (United States)
(“PCAOB”) and are required to be independent with respect to
the Company in accordance with the U.S. federal securities laws
and the applicable rules and regulations of the Securities and
Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of
the PCAOB. Those standards require that we plan and perform
the audits to obtain reasonable assurance about whether the
financial statements are free of material misstatement, whether
due to error or fraud, and whether effective internal control
over financial reporting was maintained in all material respects.
Our audits of the consolidated financial statements included
performing procedures to assess the risks of material misstate-
ment of the consolidated financial statements, whether due to
error or fraud, and performing procedures that respond to those
risks. Such procedures included examining, on a test basis, evi-
dence regarding the amounts and disclosures in the consolidat-
ed financial statements. Our audits also included evaluating the
accounting principles used and significant estimates made by
management, as well as evaluating the overall presentation of the
consolidated financial statements. Our audit of internal control
over financial reporting included obtaining an understanding of
internal control over financial reporting, assessing the risk that a
material weakness exists, and testing and evaluating the design and
operating effectiveness of internal control based on the assessed
risk. Our audits also included performing such other procedures
as we considered necessary in the circumstances. We believe that
our audits provide a reasonable basis for our opinions.
Definition and Limitations of Internal Control
over Financial Reporting
A company’s internal control over financial reporting is a process
designed to provide reasonable assurance regarding the reliabil-
ity of financial reporting and the preparation of consolidated
financial statements for external purposes in accordance with
generally accepted accounting principles. A company’s internal
control over financial reporting includes those policies and pro-
cedures that (1) pertain to the maintenance of records that, in
reasonable detail, accurately and fairly reflect the transactions
and dispositions of the assets of the company; (2) provide rea-
sonable assurance that transactions are recorded as necessary
to permit preparation of consolidated financial statements in ac-
cordance with generally accepted accounting principles, and that
receipts and expenditures of the company are being made only
in accordance with authorizations of management and directors
report of independent registered
public accounting firm
80
evaluation of the fair value of the Rochas Fashion trademark.
The significant assumptions used to estimate the fair value of
the Rochas Fashion intangible asset included the forecasted
revenue, operating margin, and discount rate. These signifi-
cant assumptions are forward-looking and could be affected
by future economic and market conditions. Changes in these
assumptions could have a significant impact on the fair value of
the Rochas Fashion intangible asset, the amount of any impair-
ment charge, or both.
We obtained an understanding, evaluated the design and
tested the operating effectiveness of Company’s controls over
the Rochas Fashion intangible asset impairment review pro-
cess, including management’s review of the significant assump-
tions described above and controls over the completeness and
accuracy of the data used to develop such estimates.
To test the estimated fair value of the Rochas Fashion in-
tangible asset, our audit procedures included, among others,
assessing the appropriateness of the valuation model used,
evaluating the significant assumptions discussed above, and
testing and evaluating the completeness and accuracy of the
underlying data supporting the significant assumptions and
estimates. We compared the financial projections to the his-
torical accuracy of management’s estimates. We involved our
valuation specialists to assist in our evaluation of the Compa-
ny’s model, valuation methodology and the discount rate.
Mazars USA LLP
We have served as the Company’s auditor since 2004.
New York, New York
February 27, 2024
report of independent registered
public accounting firm
of the company; and (3) provide reasonable assurance regarding
prevention or timely detection of unauthorized acquisition, use,
or disposition of the company’s assets that could have a material
effect on the consolidated financial statements.
Because of its inherent limitations, internal control over fi-
nancial reporting may not prevent or detect misstatements.
Also, projections of any evaluation of effectiveness to future
periods are subject to the risk that controls may become in-
adequate because of changes in conditions, or that the degree
of compliance with the policies or procedures may deteriorate.
Critical Audit Matter
The critical audit matter communicated below is a matter aris-
ing from the current period audit of the consolidated financial
statements that was communicated or required to be commu-
nicated to the audit committee and that: (1) relates to accounts
or disclosures that are material to the consolidated financial
statements and (2) involve especially challenging, subjective,
or complex judgments. The communication of the critical audit
matter does not alter in any way our opinion on the consoli-
dated financial statements, taken as a whole, and we are not,
by communicating the critical audit matter below, providing a
separate opinion on the critical audit matter or on the accounts
or disclosures to which it relates.
As described in Note 8 to the consolidated financial state-
ments, the Company’s consolidated Trademarks (indefinite
lives) balance of $108.8 million at December 31, 2023, which
included $11.3 million of the Rochas Fashion indefinite life in-
tangible asset.
The principal considerations in determining management’s
annual impairment test for the Rochas Fashion intangible asset
as a critical audit matter was due to the change in events and
circumstances surrounding the Rochas Fashon brand trade-
mark and complexity of management’s estimates used in their
INTERPARFUMS, INC. 2023 ANNUAL REPORT
INTERPARFUMS, INC. 2023 ANNUAL REPORT
81
INTER PARFUMS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share data)
Years Ended December 31,
2023
2022
ASSETS
Current assets:
Cash and cash equivalents
$88,462
$104,713
Short-term investments
94,304 150,833
Accounts receivable, net
247,240
197,584
Inventories
371,859
289,984
Receivables, other
7,012
28,803
Other current assets
29,458
15,650
Income taxes receivable
691
157
Total current assets
839,026
787,724
Property, equipment and leasehold improvements, net
169,222
166,722
Rights of use assets, net
28,613
27,964
Trademarks, licenses and other intangible assets, net
296,356
290,853
Deferred tax assets
14,545
11,159
Other assets
21,567
24,120
Total assets
$1,369,329
$1,308,542
LIABILITIES AND EQUITY
Current liabilities:
Loans payable - banks
$4,420
$–
Current portion of long-term debt
29,587
28,547
Current portion of lease liabilities
5,951
5,296
Accounts payable - trade
97,409
88,388
Accrued expenses
178,880
213,621
Income taxes payable
8,498
8,715
Total current liabilities
324,745
344,567
Long–term debt, less current portion
127,897
151,494
Lease liabilities, less current portion
24,517
24,335
Equity:
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, 32,004,660 and 31,967,300 shares
on December 31, 2023, and 2022, respectively
32
32
Additional paid-in capital
98,565
90,186
Retained earnings
693,848
620,095
Accumulated other comprehensive loss
(40,188)
(56,056)
Treasury stock, at cost, 9,981,665 and 9,864,805 common shares
on December 31, 2023, and 2022, respectively
(52,864)
(37,475)
Total Inter Parfums, Inc. shareholders’ equity
699,393
616,782
Noncontrolling interest
192,777
171,364
Total equity
892,170
788,146
Total liabilities and equity
1,369,329
$1,308,542
(See accompanying notes to consolidated financial statements)
financial statements
82
INTER PARFUMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except share and per share data)
Years Ended December 31,
2023
2022 2021
Net sales
$1,317,675
$1,086,653
$879,516
Cost of sales
478,597
392,231
322,614
Gross margin
839,078
694,422
556,902
Selling, general, and administrative expenses
587,696
492,370
406,459
Impairment loss
–
7,749
2,393
Income from operations
251,382
194,303
148,050
Other expenses (income):
Interest expense
11,253
3,599
2,825
Loss (gain) on foreign currency 1,582 1,921 (2,338)
Interest and investment income (10,729) (5,486)
(3,403)
Other (Income ) expense (317)
(50) (53)
1,789 84
(2,969)
Income before income taxes
249,593
194,219
151,019
Income taxes
61,817
43,182
40,992
Net income
187,776
151,037
110,027
Less: Net income attributable to the noncontrolling interest
35,122
30,099
22,616
Net income attributable to Inter Parfums, Inc.
$152,654
$120,938
$87,411
Net income attributable to Inter Parfums, Inc. common shareholders:
Basic
$4.77
$3.80
$2.76
Diluted
4.75
3.78
2.75
Weighted average number of shares outstanding:
Basic
31,994,328
31,859,417
31,676,796
Diluted
32,139,702
31,988,753
31,835,408
Dividends declared per share
$2.50
$2.00
$1.00
INTER PARFUMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In thousands, except share and per share data)
Years ended December 31,
2023
2022
2021
Net income
$187,776
$151,037
$110,027
Other comprehensive income:
Net derivative instrument (loss) income, net of tax
(3,329)
2,356
(1,367)
Transfer of OCI into earnings
1,709
992
-
Translation adjustments, net of tax
24,042
(29,683)
(42,967)
22,422
(26,335) (44,334)
Comprehensive income
210,198 124,702
65,693
Comprehensive income attributable to noncontrolling interests:
Net income
35,122 30,099
22,616
Net derivative instrument income (loss), net of tax
25
647
(375)
Translation adjustments, net of tax
6,529 (9,358) (11,524)
41,676
21,388 10,717
Comprehensive income attributable to Inter Parfums, Inc.
$168,522
$103,314
$54,976
(See accompanying notes to consolidated financial statements.)
INTERPARFUMS, INC. 2023 ANNUAL REPORT
INTERPARFUMS, INC. 2023 ANNUAL REPORT
83
financial statements
INTER PARFUMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY
(In thousands, except share and per share data)
Years Ended December 31,
2023
2022
2021
Common stock, beginning and end of year
$32
$32
$32
Additional paid-in capital, beginning of year
90,186
87,132
75,708
Shares issued upon exercise of stock options
8,025
6,004
5,393
Share-based compensation
1,246
1,355
1,566
Shares issued for license acquisition
-
-
5,000
Transfer of subsidiary shares purchased
(892)
(4,305)
(535)
Additional paid-in capital, end of year
$98,565
$90,186
$87,132
Retained earnings, beginning of year
620,095
560,663
503,567
Net income
152,654
120,938
87,411
Dividends
(80,047)
(63,743)
(31,690)
Stock-based compensation
1,146
2,237
1,375
Retained earnings, end of year
$693,848
$620,095
$560,663
Accumulated other comprehensive loss, beginning of year
(56,056)
(38,432)
(5,997)
Foreign currency translation adjustment, net of tax
17,513 (20,325)
(31,443)
Transfer from other comprehensive income into earnings
1,709
992
-
Net derivative instrument gain, net of tax
(3,354)
1,709
(992)
Accumulated other comprehensive loss, end of year
$(40,188)
$(56,056)
$(38,432)
Treasury stock, beginning of year
(37,475)
(37,475)
(37,475)
Shares repurchased (15,389)
-
-
Treasury stock, end of year
(52,864) (37,475) (37,475)
Noncontrolling interest, beginning of year
171,364
166,412
166,615
Net income
35,122
30,099
22,616
Foreign currency translation adjustment, net of tax
6,529 (9,358) (11,524)
Net derivative instrument loss, net of
25
647
(375)
Dividends (20,301) (16,056)
(9,836)
Share-based compensation 180
(282) (293)
Transfer of subsidiary shares purchased
(142)
(98) (791)
Noncontrolling interest, end of year
$192,777
$171,364 $166,412
Total equity
$892,170
$788,146
$738,332
(See accompanying notes to consolidated financial statements.)
84
INTER PARFUMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
Years ended December, 31
2023
2022
2021
Cash flows from operating activities:
Net income
$187,776
$151,037
$110,027
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization including impairment loss
17,331
22,539
12,698
Provision for doubtful accounts (1,734)
2,353
853
Noncash stock compensation
2,525
3,143
2,853
Share of income of equity investment (317)
49
(53)
Non cash lease expense
5,448
4,980
7,302
Deferred tax expense (benefit)
(2,987)
(3,604)
(465)
Change in fair value of derivatives
(301)
227
65
Changes in:
Accounts receivable
(36,843)
(59,640)
(45,395)
Inventories
(73,700)
(98,297)
(49,815)
Other assets 11,868
(13,651)
(16,725)
Operating lease liabilities
(5,290)
(4,795)
(7,503)
Accounts payable and accrued expenses
3,064
64,738
103,046
Income taxes, net
(1,066)
3,952
2,698
Net cash provided by operating activities
105,774
73,031
119,586
Cash flows from investing activities:
Purchases of short-term investments
(221,111)
(1,038)
(55,691)
Proceeds from sale of short-term investments
281,741
896
10,644
Purchase of property, equipment and leasehold improvements
(6,465)
(33,756)
(141,274)
Payment for intangible assets acquired
(46,903)
(56,746)
(1,545)
Net cash provided by (used in) investing activities
7,262
(90,644)
(187,866)
Cash flows from financing activities:
Proceeds from loans payable, bank
4,325
-
-
Proceeds from issuance of long-term debt
-
52,492
157,382
Repayment of long-term debt
(28,800)
(19,861)
(43,056)
Proceeds from exercise of options
8,025
6,003
5,393
Purchase of subsidiary shares from noncontrolling interests
(1,027) (4,403) -
Dividends paid
(80,047)
(63,743)
(31,690)
Dividends paid to noncontrolling interests
(20,301)
(16,056)
(9,836)
Purchase of treasury stock (15,389)
-
-
Net cash (used in) provided by financing activities
(133,214)
(45,568)
78,193
Effect of exchange rate changes on cash
3,927
(493)
(11,207)
Net decrease in cash and cash equivalents
(16,251)
(63,674)
(1,294)
Cash and cash equivalents – beginning of year
104,713
168,387
169,681
Cash and cash equivalents – end of year
$88,462
$104,713
$168,387
Supplemental disclosures of cash flow information:
Cash paid for:
Interest
$5,823
$2,987
$2,468
Income taxes
60,990
38,492
40,497
(See accompanying notes to consolidated financial statements.)
financial statements
INTERPARFUMS, INC. 2023 ANNUAL REPORT
INTERPARFUMS, INC. 2023 ANNUAL REPORT
85
notes to consolidated financial statements
(in thousands, except share and per share data)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(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 prestige 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 re-
spect to the Company’s largest brands, we license the Jimmy
Choo, Montblanc, Coach and GUESS brand names. As a per-
centage of net sales, product sales for the Company’s largest
brands were as follows:
Year Ended December 31,
2023
2022
2021
Jimmy Choo
17%
18%
19%
Montblanc
17%
18%
18%
Coach
15%
15%
16%
GUESS
12%
12%
12%
Donna Karan/DKNY
7%
3%
-
Ferragamo
5%
5%
1%
Basis Of Preparation
The consolidated financial statements include the accounts
of the Company and its subsidiaries, including 72% owned
Interparfums SA, a subsidiary whose stock is publicly traded
in France. All material intercompany balances and transactions
have been eliminated.
Management Estimates
Management makes assumptions and estimates to prepare fi-
nancial statements in conformity with accounting principles
generally accepted in the United States of America. Those as-
sumptions and estimates directly affect the amounts reported
and disclosures included in the consolidated financial state-
ments. 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 for-
eign currency, assets and liabilities are translated to U.S. dol-
lars 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 accumu-
lated 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. The
Company also has short-term investments which consist of mar-
ketable equity securities, certificates of deposit and other con-
tracts with maturities greater than three months. The Company
monitors concentrations of credit risk associated with financial
institutions with which the Company conducts significant busi-
ness. 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 primarily 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 doubt-
ful accounts or balances which are estimated to be uncollectible,
which aggregated $2.1 million and $4.7 million as of December
31, 2023, and 2022, 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
are 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, receiv-
ing, 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 lia-
bilities and measured at fair value. The Company uses derivative
86
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 com-
mitment (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 re-
ported in equity (as a component of accumulated other compre-
hensive 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 pur-
poses that are not designated for hedge accounting treatment.
For these derivative instruments, changes in their fair value are
recorded in earnings immediately.
Property, Equipment
and Leasehold Improvements
Property, equipment and leasehold improvements are stated at
cost less accumulated depreciation. Depreciation is provided
using the straight line method over the estimated useful lives for
furniture and equipment, which range between three and fifteen
years. Depreciation on buildings and leasehold improvements is
calculated using the straight-line method over the shorter of the
lease term or estimated useful asset lives, which range between
seven and fifty years. 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 trade-
marks which are not amortized. The Company evaluates in-
definite-lived intangible assets for impairment at least annually
during the fourth quarter, or more frequently when events oc-
cur 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 recover-
able. When testing indefinite-lived intangible assets for impair-
ment, the evaluation requires a comparison of the estimated fair
value of the asset to the carrying value of the asset. The fair val-
ues used in our evaluations are estimated based upon discount-
ed future cash flow projections using a weighted average cost of
capital of 10.39% and 9.80% in 2023 and 2022, respectively. 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 prod-
ucts 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 principally consist
of licenses and are amortized on a straight-line basis over
the shorter of the license term or estimated economic life,
ranging from three to twenty years. Intangible assets subject
to amortization are evaluated for impairment testing when-
ever 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 amor-
tizable 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 pro-
jection 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 im-
pairment charge would be recorded to reduce the intangible
asset to its fair value.
Revenue Recognition
The Company sells its products to department stores, per-
fumeries, specialty stores and domestic and international
wholesalers and distributors. Our revenue contracts repre-
sent single performance obligations to sell our products to
customers. 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 substantial majority of our revenue
is recognized at a point in time when control of the prom-
ised goods is transferred to customers based on agreed upon
shipping terms, which usually occurs upon delivery. Revenue is
recognized in an amount that reflects the consideration that
we expect to receive in exchange for those goods. Net sales
are comprised of gross revenues less incentives to customers
such as returns, trade discounts and allowances, which give
rise to variable consideration. The Company does not bill its
customers’ freight and handling charges. All shipping and han-
dling costs, which aggregated $14.2 million, $15.8 million and
$10.0 million in 2023, 2022 and 2021, respectively, are included
in selling, general and administrative expenses in the consoli-
dated statements of income. The Company grants credit to all
INTERPARFUMS, INC. 2023 ANNUAL REPORT
INTERPARFUMS, INC. 2023 ANNUAL REPORT
87
notes to consolidated financial statements
(in thousands, except share and per share data)
qualified customers and does not believe it is exposed signifi-
cantly to any undue concentration of credit risk. In 2023, Macys,
our top retail customer, accounted for approximately 12% of net
sales. No one customer represented 10% or more of net sales
in 2022 and 2021.
Sales Returns
Generally, the Company does not permit customers to return
their unsold products. However, for U.S. based customers, we al-
low 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 antic-
ipated 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
its estimate of potential sales returns as a reduction of sales and
cost of sales with corresponding entries to accrued expenses, to
record the refund liability, and inventory, for the right to recov-
er goods from the customer. The refund liability associated with
estimated returns was $5.5 million and $8.6 million at December
31, 2023 and 2022, respectively, and the amounts recognized for
the rights to recover products was $2.4 million and $3.2 million
at December 31, 2023 and 2022, respectively. The physical condi-
tion 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 com-
petitive 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 pro-
motions as cost of sales. Certain other incentive arrangements
require the payment of a fee to customers based on their at-
tainment 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 admin-
istrative expenses. Advertising and promotional costs included
in selling, general and administrative expenses were $259.9 mil-
lion, $212.4 million and $171.1 million for 2023, 2022 and 2021,
respectively. Costs relating to purchase with purchase and gift
with purchase promotions that are reflected in cost of sales ag-
gregated $52.3 million, $43.1 million and $36.9 million in 2023,
2022 and 2021, 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 leases its offices and warehouses, vehicles, and
certain office equipment, substantially all of which are classified
as operating leases. The Company currently has no material fi-
nancing leases. The Company determines if an arrangement is a
lease at inception. Operating lease assets and obligations are rec-
ognized at the lease commencement date based on the present
value of lease payments over the lease term.
License Agreements
The Company’s license agreements generally provide the
Company with worldwide rights to manufacture, market and
sell prestige fragrances 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 agree-
ment provisions. The remaining terms, excluding potential re-
newal periods, range from approximately 1 to 12 years. Under
each license, the Company is required to pay royalties in the
range of 6% 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 ac-
quire, 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 ex-
penses are accrued in the period in which net sales are recog-
nized while advertising and promotional expenses are accrued at
the time these costs are incurred.
In addition, the Company is exposed to certain concentration
risk. Most of our prestige fragrance brands are licensed from
88
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 liabil-
ity 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 re-
turns. The net deferred tax assets assume sufficient future earn-
ings 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 ad-
justment 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 con-
solidated 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 por-
tion of the Company’s investment deemed sold, is reflected as
an equity adjustment in the consolidated balance sheets.
Treasury Stock
The Board of Directors has authorized share repurchases of the
Company’s common stock (Share Repurchase Authorizations).
Share repurchases under Share Repurchase Authorizations are
made through open market transactions, negotiated purchase
or otherwise, at times and in such amounts within the parame-
ters authorized by the Board. Shares repurchased under Share
Repurchase Authorizations are held in treasury for general corpo-
rate 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 November 2023, the Financial Accounting Standards Board
(“FASB”) issued Accounting Standards Update (“ASU”) No.
2023-07, Segment Reporting (Topic 280): Improvements to
Reportable Segment Disclosures. The ASU updates reportable
segment disclosure requirements, primarily through requiring
enhanced disclosures about significant segment expenses and
information used to assess segment performance and allocate
resources. The guidance is effective for fiscal years beginning
after December 15, 2023, and interim periods for fiscal years
beginning after December 15, 2024, on a retrospective basis.
Early adoption is permitted. We are currently evaluating the im-
pact of adopting this ASU on our disclosures.
In December 2023, the FASB issued ASU No. 2023-09, In-
come Taxes (Topic 740): Improvements to Income Tax Dis-
closures. The ASU includes amendments requiring enhanced
income tax disclosures, primarily related to standardization
and disaggregation of rate reconciliation categories and income
taxes paid by jurisdiction. The guidance is effective for annual
periods beginning after December 15, 2024. Early adoption is
permitted and shall be applied on a prospective basis with the
option to apply retrospectively. We are currently evaluating the
impact of adopting this ASU on our disclosures.
There are no other recent accounting pronouncements is-
sued but not yet adopted that would have a material effect on
our consolidated financial statements.
Reclassifications
Certain prior year amounts in the accompanying notes to con-
solidated financial statements have been reclassified to conform
with current period presentation.
Correction of Immaterial Misstatements
in Prior Period Financial Statements
During the year ended December 31, 2023, the Company iden-
tified an error that caused an overstatement of line items on the
previously reported consolidated statement of cash flows. The
error does not impact any other consolidated financial state-
ment included herein. Specifically, the error related to the tim-
ing of payments to Lacoste in accordance with the acquisition
agreement of the Lacoste trademark in 2022 which required a
payment in 2022 and an additional payment in 2023. In the 2022
consolidated statement of cash flow, the payment was reported
to have been made in full during 2022. This error had no im-
pact on net income or earnings per share for the year ended
December 31, 2022. The impact of the error resulted in a move-
ment of $42.1 million between “Change in Accounts payable and
accrued expenses” within operating cash flows and “Payment
for intangible assets acquired” within investing cash flows.
INTERPARFUMS, INC. 2023 ANNUAL REPORT
INTERPARFUMS, INC. 2023 ANNUAL REPORT
89
In accordance with Staff Accounting Bulletin (“SAB”) No. 99, Materiality, and SAB No. 108, Considering the Effects of Prior
Year Misstatements when Quantifying Misstatements in Current Year Financial Statements, the Company evaluated the errors and
determined that the impact was not material to any of our previously issued financial statements.
The following table presents a summary of the impact by financial statement line item of the corrections for the year ended
December 31, 2022:
Consolidated Statement of Cash Flows
(In thousands)
As previously
Years ended December 31, 2022
reported Adjustment
As revised
Change in Accounts payable and accrued expenses
106,857
(42,119)
$64,738
Net cash provided by operating activities
115,150
(42,119)
73,031
Payment for intangible assets acquired
(98,865)
42,119
(56,746)
Net cash used in investing activities
(132,763)
42,119
(90,644)
notes to consolidated financial statements
(in thousands, except share and per share data)
(2) Impact of COVID-19 Pandemic
Our business has continued to significantly improve through-
out 2021, 2022, and 2023 after the disastrous effects of the
COVID-19 Pandemic starting in early 2020, as retail stores re-
opened, and consumers increased online purchasing. While the
COVID-19 Pandemic had significantly restricted international
travel, the travel retail business has picked up. We experi-
enced significant strains on our supply chain causing disrup-
tions affecting the procurement of components, the ability to
transport goods, and related cost increases. These disruptions
came at a time when demand for our product lines has never
been stronger or more sustained. We have addressed this is-
sue since the beginning of 2021, by ordering well in advance
of need and in larger quantities. Since 2021, we have strived
to carry more inventory overall, source the same components
from multiple suppliers and when possible, manufacture prod-
ucts closer to where they are sold. The supply chain bottle-
necks are largely abated.
(3) Recent Agreements
Abercrombie & Fitch
In 2023, we announced our agreement to distribute
Abercrombie & Fitch’s number one men’s fragrance, Fierce,
in selected markets. The first phase of the agreement, which
became effective on September 1, 2023, covers Fierce distri-
bution in certain major markets, including Europe, Mexico and
Australia. The second phase, which activated in February 2024,
covers distribution in additional markets in Western Europe
and Latin America, and may include other flankers of the Fierce
family of products.
Roberto Cavalli
In July 2023, we closed a transaction agreement with Roberto
Cavalli, whereby an exclusive and worldwide license was grant-
ed for the production and distribution of Roberto Cavalli brand
perfumes and fragrance related products. Our rights under this
license are subject to certain minimum advertising expenditures
and royalty payments as are customary in our industry. The li-
cense became effective in July 2023 and will last for 6.5 years.
Lacoste
In December 2022, we closed a transaction agreement with
Lacoste, whereby an exclusive and worldwide license was
granted for the production and distribution of Lacoste brand
perfumes and cosmetics. Our rights under this license are sub-
ject to certain minimum advertising expenditures and royalty
payments as are customary in our industry. The license became
effective in January 2024 and will last for 15 years.
Dunhill
The Dunhill fragrance license expired on September 30, 2023 and
was not renewed. The Company has now entered the twelve-
month sell-off period during which it will maintain the right to sell-
off remaining Dunhill fragrance inventory, which is customary in
the fragrance industry. All usable components have been converted
to finished goods, and any remaining components will be destroyed.
Donna Karan and DKNY
In September 2021, we entered into a long-term global licensing
agreement for the creation, development and distribution of fra-
grances and fragrance-related products under the Donna Karan
90
and DKNY brands. Our rights under this license are subject to
certain minimum advertising expenditures and royalty payments
as are customary in our industry. With this agreement, we have
gained several well-established and valuable fragrance franchis-
es, most notably Donna Karan Cashmere Mist and DKNY Be
Delicious, as well as a significant loyal consumer base around the
world. In connection with the grant of license, we issued 65,342
shares of Inter Parfums, Inc. common stock valued at $5.0 mil-
lion to the licensor. The exclusive license became effective July
1, 2022, and we are planning to launch new fragrances under
these brands in 2024.
Rochas Fashion
As a result of operational challenges faced by the Rochas
Fashion business we took a $2.4 million impairment charge on
our Rochas fashion trademark in the first quarter of 2021. In
the fourth quarter of 2022, we again took a $6.8 million impair-
ment charge on the Rochas fashion trademark after an indepen-
dent expert concluded that the valuation of the trademark was
$11.3 million. In 2023, the Rochas teams underwent a strategic
shift to take over their own brand operations, exiting contracts
with manufacturers and distributors to make this new struc-
ture operational beginning in 2024. An independent expert
concluded that the valuation based on this new business model
would not require additional impairments.
Land and Building Acquisition
Headquarters in Paris
In April 2021, Interparfums SA, our 72% owned French subsid-
iary, completed the acquisition of its headquarters at 10 rue de
Solférino in the 7th arrondissement of Paris from the property
developer. This is an office complex combining three buildings
connected by two inner courtyards, and consists of approxi-
mately 40,000 total sq. ft.
The purchase price included the complete renovation of the
site. As of December 31, 2023, $154 million (€139 million) of the
purchase price, including approximately $3.1 million of acqui-
sition costs, is included in property, equipment and leasehold
improvements on the accompanying consolidated balance sheet.
The purchase price has been allocated approximately $63.3
million to land and $90.7 million to the building. The build-
ing, which was delivered on February 28, 2022, includes the
building structure, development of the property, façade wa-
terproofing, general and technical installations and interior fit-
tings that will be depreciated over a range of 7 to 50 years. The
Company has elected to depreciate the building cost based on
the useful lives of its components. As of December 31, 2023,
there was no cash held in escrow included in property, equip-
ment and leasehold improvements on the accompanying con-
solidated balance sheet.
The acquisition was financed by a 10-year €120 million (ap-
proximately $132.6 million) bank loan which bears interest at
one-month Euribor plus 0.75%. Approximately €80 million of
the variable rate debt was swapped for variable interest rate
debt with a maximum rate of 2% per annum. The swap effec-
tively exchanges the variable interest rate to a fixed rate of
approximately 1.1%.
(4) Inventories
Year Ended December 31,
2023
2022
Raw materials and
component parts
$158,733
$146,772
Finished goods
213,126
143,212
$371,859
$289,984
Overhead included in inventory aggregated $5.4 million and
$3.4 million as of December 31, 2023 and 2022, respectively.
Included in inventories is an inventory reserve, which rep-
resents 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
$21.5 million and $11.4 million as of December 31, 2023 and
2022, respectively.
INTERPARFUMS, INC. 2023 ANNUAL REPORT
INTERPARFUMS, INC. 2023 ANNUAL REPORT
91
notes to consolidated financial statements
(in thousands, except share and per share data)
(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, 2023
Quoted Prices in
Significant
Significant
Active Markets for Other Observable Unobservable
Identical Assets Inputs Inputs
Total ( Level 1)
(Level 2) (Level 3)
Assets:
Short-term investments
$94,304
$12,868
$80,614 $822
Interest rate swaps
3,909
-
3,909
-
Foreign currency forward exchange contracts
not accounted for using hedge accounting
359
-
359
-
Foreign currency forward exchange contracts
accounted for using hedge accounting
1,533
-
1,533
-
$100,105
$12,868
$86,415
$822
FAIR VALUE MEASUREMENTS AT DECEMBER 31, 2022
Quoted Prices in
Significant
Significant
Active Markets for Other Observable Unobservable
Identical Assets Inputs Inputs
Total ( Level 1)
(Level 2) (Level 3)
Assets:
Short-term investments
$150,833
$19,861
$130,174
$798
Interest rate swaps
6,758
-
6,758
-
Foreign currency forward exchange contracts
accounted for using hedge accounting
$1,189
-
$1,189
-
$158,780
$19,861
$138,121
798
Liabilities
Foreign currency forward exchange contracts
not accounted for using hedge accounting
68
-
68
-
68
-
68
-
The carrying amount of cash and cash equivalents including money market funds, short-term investments including marketable
equity securities, 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 interest rates on
92
the Company’s indebtedness approximate current market rates.
The fair value of the Company’s long-term debt was estimated
based on the current rates offered to companies for debt with
the same remaining maturities and is approximately equal to its
carrying value.
Foreign currency forward exchange contracts are valued
based on quotations from financial institutions and the value of
interest rate swaps is the discounted net present value of the
swaps using third party quotes from financial institutions.
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.
(6) Derivative Financial Instruments
The Company enters into foreign currency forward exchange
contracts to hedge exposure related to receivables denom-
inated 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 hedg-
ing purposes, it is determined that a high degree of initial effec-
tiveness 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 effec-
tively 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 method-
ology 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 ac-
counting 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 December 2022, to finance the acquisition of the Lacoste
trademark, the Company entered into a €50 million (approxi-
mately $55.3 million) 4-year term loan with a variable interest
rate. This variable rate debt was swapped for variable interest
rate debt with a maximum rate of 2% per annum. This swap is a
hedged derivative instrument and is therefore recorded at fair
value and changes in fair value are reflected in other compre-
hensive income.
In connection with the April 2021 acquisition of the office
building complex in Paris, €120 million (approximately $132.6
million) of the purchase price was financed through a 10-year
term loan. The Company entered into interest rate swap con-
tracts related to €80 million of the loan, effectively exchanging
the variable interest rate to a fixed rate of approximately 1.1%.
This derivative instrument is recorded at fair value and chang-
es in fair value are reflected in the accompanying consolidated
statements of income.
Gains and losses in derivatives designated as hedges are ac-
cumulated 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, 2023. In-
terest expense includes a loss of $2.8 million in 2023 and a gain
of $6.3 million and $0.2 million in 2022 and 2021, respectively,
resulting from an interest rate swap.
All derivative instruments are reported as either assets or
liabilities on the consolidated balance sheet measured at fair
value. The valuation of interest rate swaps is included in long-
term debt on the accompanying consolidated balance sheets.
The valuation of foreign currency forward exchange contracts
at December 31, 2023 and December 31, 2022, resulted in an as-
set and is included in other current assets on the accompanying
consolidated balance sheets.
At December 31, 2023, the Company had foreign currency
contracts in the form of forward exchange contracts with no-
tional amounts of approximately U.S. $61.0 million and GB £2.5
million which all have maturities of less than one year.
(7) Property, Equipment and Leasehold Improvements
Year Ended December 31,
2023 2022
Land and Building
(construction in progress)
$157,057 $148,137
Equipment
62,384
59,689
Leasehold Improvements
2,364
2,293
$221,805
$210,119
Less accumulated
depreciation and amortization
52,583 43,397
$169,222 $166,722
INTERPARFUMS, INC. 2023 ANNUAL REPORT
INTERPARFUMS, INC. 2023 ANNUAL REPORT
93
notes to consolidated financial statements
(in thousands, except share and per share data)
(8) Trademarks, Licenses and Other Intangible Assets
Gross Accumulated Net Book
2023 Amount Amortization Value
Trademarks
(indefinite lives) $108,760
$-
$108,760
Trademarks
(finite lives)
42,752
66
42,686
Licenses
(finite lives)
215,307
73,264
142,043
Other intangible assets
(finite lives)
19,524
16,657
2,867
Subtotal
277,583
89,987
187,596
Total
$386,343
$89,987
$296,356
Gross Accumulated Net Book
2022 Amount Amortization Value
Trademarks
(indefinite lives)
$105,022
$-
$105,022
Trademarks
(finite lives)
41,267
64
41,203
Licenses
(finite lives)
205,235
63,535
141,700
Other intangible assets
(finite lives)
17,849
14,921
2,928
Subtotal
264,351
78,520
185,831
Total
$369,373
$78,520 $290,853
Amortization expense was $7.5 million, $6.8 million and $5.9
million in 2023, 2022 and 2021, respectively. Amortization ex-
pense is expected to approximate $14.3 million in 2024, $13.6
million in 2025, $12.0 million in 2026, and $11.4 million in 2027
and 2028. The weighted average amortization period for trade-
marks, licenses and other intangible assets with finite lives are
18 years, 14.3 years and 2.5 years, respectively, and 14 years
on average.
The Company reviews intangible assets with indefinite lives for
impairment whenever events or changes in circumstances indi-
cate that the carrying amount may not be recoverable. There
was an impairment charge for trademarks with indefinite useful
lives of $0 million, $6.8 million and $2.4 million in 2023, 2022
and 2021, respectively, relating to our Rochas fashion business
and an impairment charge for trademarks with indefinite useful
lives of $0.9 million in 2022 relating to our Intimate trademark.
The fair values used in our evaluations are estimated based upon
discounted future cash flow projections using a weighted aver-
age cost of capital of 10.39%, 9.80%, and 7.47% as of December
31, 2023, 2022 and 2021, respectively. 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 impair-
ment 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 car-
rying value, then the asset is not amortized. The Company re-
views intangible assets with finite lives for impairment whenever
events or changes in circumstances indicate that the carrying
amount may not be recoverable.
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 on July 1, 2027 for €70 million (approximate-
ly $77 million), representing the residual value, in accordance
with an amendment signed in 2021. Because the residual value
of the intangible asset exceeds its carrying value, the asset is
not being amortized.
(9) Accrued Expenses
Accrued expenses consist of the following:
Year Ended December 31, 2023
2022
Advertising liabilities
$64,815
$42,338
Salary (including bonus
and related taxes)
23,546
21,128
Royalties
27,477
26,532
Due vendors (not yet invoiced)
41,859
105,869
Retirement reserves
10,444
8,001
Refund (return) liability
5,507
8,604
Other
5,232
1,149
$178,880
$213,621
94
(10) Loans Payable – Banks
Loans payable – banks consist of the following:
The Company and its domestic subsidiaries have available a $25 million unsecured revolving line of credit due on demand, which
bears interest at the daily Secured Overnight Financing Rate (“SOFR”) plus 2% (the SOFR was 5.3% as of December 31, 2023). The
line of credit which has a maturity date of December 13, 2024, is expected to be renewed on an annual basis. Borrowings outstanding
pursuant to lines of credit were zero as of December 31, 2023 and 2022.
The Company’s foreign subsidiaries have available credit lines totaling approximately $8 million provided by a consortium of in-
ternational financial institutions. These credit lines bear interest at EURIBOR plus between 0.6% and 0.9% (EURIBOR was 3.96% at
December 31, 2023). Borrowings outstanding pursuant to lines of credit were $4.4 million and $0 million as of December 31, 2023
and 2022.
The weighted average interest rate on short-term borrowings was 4.5% and 0% as of December 31, 2023 and 2022.
(11) Long-term Debt
Long-term debt consists of the following:
Year Ended December 31
2023
2022
$55.3 million payable in 48 equal monthly installments of $1.1 million
beginning in December 2022, bearing interest at one-month Euribor plus 0.825% $40,334
$52,061
$132.6 million payable in 120 equal monthly installments of $1.1 million
beginning in April 2021, bearing interest at one-month Euribor plus 0.75%
95,576
104,758
$15.0 million payable in 14 equal annual installments of $1.1 million
beginning in January 2020 including interest imputed at 4.1% per annum
9,172
9,890
$17 million payable in 10 equal annual installments of $1.7 million
beginning in October 2021 including interest imputed at 2.0% per annum
12,402
13,332
$157,484
$180,041
Less current maturities
29,587
28,547
Total
$127,897
$151,494
In December 2022, to finance Interparfums SA’s acquisition of the Lacoste trademark, the Company entered into a $55.3 million
(€50 million) four-year loan agreement. The loan agreement bears interest at EURIBOR-1-month rates plus a margin of 0.825%. This
variable rate debt was swapped for variable interest rate debt with a maximum rate of 2% per annum. The swap is a derivative in-
strument and is therefore recorded at fair value and changes in fair value are reflected in the accompanying consolidated statements
of income.
In April 2021, to finance the acquisition of Interparfums SA’s corporate headquarters, the Company entered into a $132.6 million
(€120 million) ten-year credit agreement. Approximately $88.4 million (€80.0 million) of the variable rate debt was swapped for
variable interest rate debt with maximum rate of 2% per annum. 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, 2023 are approximately $29.6 million in 2024, $29.8 million in 2025,
$28.6 million in 2026, $15.9 million in 2027, $15.9 million in 2028, and $37.7 million thereafter through 2033.
(12) Commitments
Leases
The Company leases its offices, warehouses and vehicles, substantially all of which are classified as operating leases. The Company
currently has no material financing leases. The Company determines if an arrangement is a lease at inception. Operating lease assets
and obligations are recognized at the lease commencement date based on the present value of lease payments over the lease term.
In determining lease asset value, the Company considers fixed or variable payment terms, prepayments, incentives, and options to
extend or terminate, depending on the lease. Renewal, termination or purchase options affect the lease term used for determining
lease asset value only if the option is reasonably certain to be exercised. The Company generally uses its incremental borrowing rate
INTERPARFUMS, INC. 2023 ANNUAL REPORT
INTERPARFUMS, INC. 2023 ANNUAL REPORT
95
notes to consolidated financial statements
(in thousands, except share and per share data)
based on information available at the lease commencement date
for the location in which the lease is held in determining the
present value of lease payments.
As of December 31, 2023, the weighted average remaining
lease term was 5.1 years and the weighted average discount rate
used to determine the operating lease liability was 3.0%. Rental
expense related to operating leases was $5.8 million, $5.6 mil-
lion, and $8.2 million for the years ended December 31, 2023,
2022 and 2021, respectively. Operating lease payments included
in operating cash flows totaled $5.3 million, $4.8 million, and $7.5
million in 2023, 2022, and 2021, respectively. Noncash additions
to operating lease assets in totaled $4.8 million, $0.3 million, and
$12.2 million in 2023, 2022, and 2021, respectively.
Maturities of lease liabilities subsequent to December 31,
2023 are as follows:
(in thousands)
2024
$6,370
2025
6,031
2026
5,276
2027
5,389
2028
5,372
Thereafter
3,529
31,967
Less imputed interest (based on 3.0%
weighted-average discount rate) (1,499)
$30,468
License Agreements
The Company is party to a number of licenses and other agree-
ments for the use of trademarks and rights in connection with
the manufacture and sale of its products expiring at various
dates through 2039. In connection with certain of these license
agreements, the Company is subject to minimum annual adver-
tising commitments, minimum annual royalties and other com-
mitments as follows:
2024
$288,005
2025
280,721
2026
251,718
2027
233,945
2028
243,286
Thereafter
1,055,918
$2,353,593
Future advertising commitments are estimated based on
planned future sales for the license terms that were in effect
at December 31, 2023, without consideration for potential re-
newal 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, aggre-
gated $103.8 million, $87.0 million and $68.9 million, in 2023,
2022 and 2021, respectively, and represented 7.9%, 8.0% and
7.8% of net sales for the years ended December 31, 2023, 2022
and 2021, respectively.
(13) Equity
Share-Based Payments
The Company maintains a stock option program for key em-
ployees, 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 $1.2
million, $1.3 million and $1.4 million in 2023, 2022 and 2021,
respectively. 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 2023:
Weighted Average
Number
Grant Date
of Shares
Fair Value
Nonvested options
– beginning of year 168,730 $16.31
Nonvested options granted 47,500 $35.08
Nonvested options vested
or forfeited (94,130) $15.19
Nonvested options
-end of year 122,100 $24.47
The effect of share-based payment expenses decreased in-
come statement line items as follows:
Year Ended December 31,
2023
2022 2021
Income before
income taxes
$2,525 $3,143 $2,850
Net Income attributable
to Inter Parfums, Inc.
1,700
2,036 1,880
Earnings per share
attributable to
Inter Parfums, Inc.
0.05
0.06 0.06
96
The following table summarizes stock option activity and related information for the years ended December 31, 2023, 2022 and 2021:
Year Ended December 31, 2023
2022
2021
Weighted Average
Weighted Average
Weighted Average
Options
Exercise Price
Options Exercise Price
Options
Exercise Price
Shares under option-
beginning of year 441,580
$67.30
524,900 $57.58
713,210
$52.74
Options granted 47,500
147.71
62,000 97.84
9,000
62.18
Options exercised
(154,220)
52.04
(136,880) 43.86
(156,490)
34.46
Options forfeited
(25,890)
76.32
(8,440) 67.65
(40,820)
62.57
Shares under option-
end of year
308,970
$86.52
441,580 $67.30
524,900
$57.58
At December 31, 2023, options for 537,365 shares were available for future grant under the plans. The aggregate intrinsic value of
options outstanding is $17.9 million as of December 31, 2023 and unrecognized compensation cost related to stock options outstand-
ing aggregated $2.9 million, which will be recognized over the next five years.
The weighted average fair values of options granted by Inter Parfums, Inc. during 2023, 2022 and 2021 were $35.08, $20.36 and
$11.35 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,
2023
2022
2021
Weighted average expected stock-price volatility
29%
26%
25%
Weighted average expected option life
4.0 yrs
4.0 yrs
5.0 yrs
Weighted average risk-free interest rate
3.8%
4.0%
0.4%
Weighted average dividend yield
2.0%
2.4%
1.6%
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,
2023
2022 2021
Proceeds from stock options exercised
$8,025
$6,003
$5,393
Tax benefits
$1,150
$800
$1,300
Intrinsic value of stock options exercised
$11,578
$6,760
$7,800
The following table summarizes additional stock option information as of December 31, 2023:
Options Outstanding
Weighted Average
Exercise Price Options Outstanding Remaining Contractual Life Options Exercisable
$62.18 - $69.11
100,680
1.05 years
96,180
$73.09 104,790
2.00 years
79,490
$97.84
56,000
5.00 years
11,200
$147.71
47, 500
6.00 years
-
Totals 308,970 2.85 years 186,870
INTERPARFUMS, INC. 2023 ANNUAL REPORT
INTERPARFUMS, INC. 2023 ANNUAL REPORT
97
notes to consolidated financial statements
(in thousands, except share and per share data)
As of December 31, 2023, the weighted average exercise price of options exercisable was $70.60 and the weighted average remaining
contractual life of options exercisable is 1.67 years. The aggregate intrinsic value of options exercisable at December 31, 2023 is $13.7 million.
In December 2018, Interparfums SA approved a plan to grant an aggregate of 26,600 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 corporate performance conditions were met and therefore in June 2022, 211,955 shares, adjusted for
stock splits, were distributed. The aggregate cost of the grant of approximately $4.8 million was recognized as compensation cost on
a straight-line basis over the requisite three-year service period.
In March 2022, Interparfums SA approved an additional plan to grant an aggregate of 88,400 shares to all Interparfums SA employees and
corporate officers having more than six months of employment at grant date, subject to certain corporate performance conditions. The
shares, subject to adjustment for stock splits, will be distributed in June 2025 and will follow the same guidelines as the December 2018 plan.
The fair value of the grant had been determined based on the quoted stock price of Interparfums SA shares as reported by the
Euronext on the date of grant. The estimated number of shares to be distributed of 93,405 has been determined taking into account
employee turnover. The aggregate cost of the grant of approximately $4.2 million will be recognized as compensation cost on a
straight-line basis over the requisite three and a quarter year service period.
Similar to the December 2018 plan, in order to avoid dilution of the Company’s ownership of Interparfums SA, all shares distrib-
uted or to be distributed pursuant to these plans will be pre-existing shares of Interparfums SA, purchased in the open market by
Interparfums SA. During the year ended December 31, 2023, the Company acquired 87,609 shares at an aggregate cost of $4.1 million.
All share purchases and issuances have been classified as equity transactions on the accompanying consolidated balance sheet.
Dividends
In February 2021, the Board of Directors authorized an annual dividend of $1.00, payable quarterly. In February 2022, the Board of
Directors authorized a 100% increase in the annual dividend to $2.00 per share and in February 2023, the Board of Directors increased
the annual dividend to $2.50 per share. In February 2024, the Board of Directors further increased the annual dividend to $3.00 per
share. The next quarterly cash dividend of $0.75 per share is payable on March 29, 2024 to shareholders of record on March 15, 2024.
(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,
2023
2022
2021
Numerator
Net Income attributable to Inter Parfums, Inc.
$152,654
$120,938
$87,411
Denominator:
Weighted average shares
31,994,328
31,859,417
31,676,796
Effect of dilutive securities:
Stock options
145,374
129,336
158,612
Denominator for diluted earnings per share
32,139,702
31,988,753
31,835,408
Earnings per share:
Net income attributable to Inter Parfums, Inc.
common shareholders:
Basic
$4.77
$3.80
$2.76
Diluted
$4.75 $3.78 $2.75
Not included in the above computations is the effect of anti dilutive potential common shares, which consist of outstanding options
to purchase 0, 38,000, and 175,000 shares of common stock for 2023, 2022, and 2021, respectively.
98
(15) Segments and Geographical 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 based 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,
2023
2022
2021
Net sales:
United States
$455,758
$342,644
$216,559
Europe
863,397
744,075
663,290
Eliminations of intercompany sales
(1,480)
(66)
(333)
$1,317,675
$1,086,653
$879,516
Net income attributable to Inter Parfums, Inc.:
United States
$63,781
$43,745
$29,359
Europe
89,250
77,193
57,869
Eliminations (377)
-
183
$152,654
$120,938
$87,411
Depreciation and amortization expense
including impairment loss:
United States
$6,517
$6,355
$3,835
Europe
10,814
16,184
8,863
$17,331
$22,539
$12,698
Interest and investment income:
United States
$346
$66
$3
Europe
10,810
5,769
3,526
Eliminations
(427)
(349)
(126)
$10,729
$5,486
$3,403
Interest expense:
United States
$1,351
$1,100
$636
Europe
10,329
2,848
2,315
Eliminations
(427)
(349)
(126)
$11,253
$3,599
$2,825
Income tax expense:
United States
$15,180
$6,920
$5,336
Europe
46,763 36,262 35,607
Eliminations (126)
-
49
$61,817
$43,182
$40,992
Total assets:
United States
$344,341
$278,090
$247,703
Europe
1,066,684
1,052,004
931,735
Eliminations
(41,696)
(21,552)
(34,074)
$1,369,329 $1,308,542 $1,145,364
INTERPARFUMS, INC. 2023 ANNUAL REPORT
INTERPARFUMS, INC. 2023 ANNUAL REPORT
99
notes to consolidated financial statements
(in thousands, except share and per share data)
Segments and Geographical Areas continued
Year Ended December 31,
2023
2022
2021
Additions to long-lived assets:
United States
$1,277
$2,318
$2,711
Europe
5,188
31,438
138,563
$6,465
$33,756
$141,274
Total long-lived assets:
United States
$57,372
$61,539
$63,094
Europe
436,819
423,999
334,033
$494,191
$485,538
$397,127
Deferred tax assets:
United States
$2,175
$2,906
$870
Europe
12,244
8,253
7,066
Eliminations
126
-
-
$14,545
$11,159
$7,936
United States export sales were approximately $230.5 million, $180.0 million and $133.4 million in 2023, 2022 and 2021, respectively.
Consolidated net sales to customers by region are as follows:
Year Ended December 31,
2023
2022
2021
North America
$511,700
$421,000
$346,900
Europe
404,400
333,400
271,600
Asia
191,800
163,600
135,200
Middle East
107,300
87,800
61,000
Central and South America
92,700
69,900
56,400
Other
9,800
11,000
8,400
$1,317,700
$1,086,700
$879,500
Consolidated net sales to customers in major countries are as follows:
Year Ended December 31,
2023
2022
2021
United States
$493,200
$410,000
$344,100
France
$51,000
$44,800
$44,000
Russia
$50,100
$33,964
$43,400
United Kingdom
$47,500
$37,900
$38,500
(16) Income Taxes
The Company and 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 material uncertain tax position at December
31, 2023.
100
The components of income before income taxes consist of the
following:
Year Ended December 31,
2023
2022
2021
U.S. operations
$78,962
$50,250
$34,742
Foreign operations
170,631
143,969
116,277
$249,593 $194,219
$151,019
The provision for current and deferred income tax expense
(benefit) consists of the following:
Year Ended December 31,
2023
2022 2021
Current:
Federal
$12,062
$6,829
$4,825
State and local
712
658
518
Foreign
52,186
39,458
36,164
$64,960
$46,945
$41,507
Deferred:
Federal
199
(802)
4
State and local
19
(49)
11
Foreign
(3,361)
(2,912) (530)
(3,143)
(3,763)
(515)
Total income
tax expense
$61,817
$43,182
$40,992
The tax effects of temporary differences that give rise to sig-
nificant portions of the deferred tax assets and deferred tax lia-
bilities are as follows:
December 31,
2023
2022
Net Deferred tax assets:
Foreign net operating loss
carry-forwards
$218
$554
Inventory and accounts receivable
3,138
3,880
Profit sharing
3,505
2,871
Stock option compensation
613
716
Effect of inventory profit
elimination
10,957
9,342
Other
1,674
266
Total gross deferred
tax assets, net
20,105
17,629
Valuation allowance
(296)
(554)
Net deferred tax assets
19,809
17,075
Deferred tax liabilities (long-term)
Building expenses
(1,327) (1,356)
Trademarks and licenses
(2,238) (2,160)
Unrealized gain on marketable
equity securities
(1,044) (1,745)
Other
(655) (655)
Total deferred tax liabilities
(5,264) (5,916)
Net deferred tax assets
$14,545 $11,159
Valuation allowances have been provided for deferred tax
assets relating to foreign net operating loss carry-forwards as
future profitable operations from certain foreign subsidiaries
might not be sufficient to realize the full amount of the de-
ferred tax assets.
No other valuation allowances have been provided as man-
agement believes that it is more likely than not that the asset will
be realized in the reduction of future taxable income.
The Company estimated the effect of global intangible low-
taxed income (“GILTI”) and has determined that it has no tax
liability related to GILTI as of December 31, 2023, 2022 and
2021. The Company also estimated the effect of foreign derived
intangible income (“FDII”) and recorded a tax benefit of approx-
imately $2.4 million, $1.5 million and $0.9 million as of Decem-
ber 31, 2023, 2022 and 2021, respectively.
A tax audit of our Company’s French subsidiary was finalized
in 2023 for the tax years 2020 and 2021. As a result of the audit’s
conclusions, a one-time assessment of € 2.8 million ($3.1 mil-
lion) is included in tax expense in the consolidated statements of
income. The Company’s French subsidiary is no longer subject
to foreign tax examination for years before 2022. At this point
in time, the Company does not believe they will face any further
assessments for tax years still open to audit.
The Company is no longer subject to U.S. federal, state,
and local income tax examinations by tax authorities for
years before 2020.
Differences between the United States federal statutory in-
come tax rate and the effective income tax rate were as follows:
Year Ended December 31,
2023 2022 2021
Statutory rates
21.0%
21.0%
21.0%
State and local taxes,
net of Federal benefit
0.2
0.2
0.3
Windfall benefit from
exercise of stock options
(0.4)
(0.4)
(0.9)
Benefit of Foreign Derived
Intangible Income
(0.9)
(0.8)
(0.6)
Effect of foreign taxes greater
than U.S. statutory rates
4.3
3.1
7.4
Other
0.6
(0.9)
(0.1)
Effective rates
24.8%
22.2%
27.1%
INTERPARFUMS, INC. 2023 ANNUAL REPORT
INTERPARFUMS, INC. 2023 ANNUAL REPORT
101
(17) Accumulated Other Comprehensive Income Loss
The components of accumulated other comprehensive loss consist of the following:
Year Ended December 31,
2023 2022 2021
Net derivative instruments,beginning of year
$1,709
$(992)
$-
Net derivative instrument (loss) gain, net of tax
(1,645)
2,701
(992)
Net derivative instruments end of year
64
1,709
(992)
Cumulative translation adjustments, beginning of year
(57,765)
(37,440)
(5,997)
Translation adjustments
17,513
(20,325)
(31,443)
Cumulative translation adjustments, end of year
(40,252)
(57,765)
(37,440)
Accumulated other comprehensive loss
$(40,188)
$(56,056)
$(38,432)
(18) Reconciliation of Cash and Cash Equivalents to the Statement of Cash Flows
The following table provides a reconciliation of cash and cash equivalents reported within the consolidated balance sheets that sum
to the total of the same such amounts shown in the consolidated statements of cash flows (in millions) as of December 31, 2021:
Year Ended December 31,
2021
Cash and cash equivalents per balance sheet $159,613
Cash held in escrow included in other assets
8,774
Cash and cash equivalents per statement of cash flows $168,387
(19) Related Party Transactions
In 2023, a foreign subsidiary of Inter Parfums, Inc. began leasing office space and receiving consulting services from affili-
ates of the Company’s Chairman and principal stockholder. The Company incurred approximately $47,000 of expenses
for these services in the year ended December 31, 2023.
notes to consolidated financial statements
(in thousands, except share and per share data)
102
COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*
Among Inter Parfums, Inc., The NASDAQ Composite Index,
2022 Peer Group and 2023 Peer Group
Board of Directors further increased the annual dividend to $3.00 per
share. The next quarterly cash dividend of $0.75 per share is payable
on March 29, 2024, to shareholders of record on March 15, 2024.
Form 10-K
A copy of the company’s 2023 Annual Report on Form 10-K, as
filed with the Securities and Exchange Commission, is available
without charge to shareholders upon request (except for exhib-
its) To: Inter Parfums, Inc. 551 Fifth Avenue New York, NY 10176
Attention: Corporate Secretary.
Corporate Performance Graph
The following graph compares the performance for the periods in-
dicated in the graph of our common stock with the performance of
the Nasdaq Market Index, the average performance the Company’s
peer group for the year ended December 31, 2022 (the “2022 Peer
Group”), and the average performance of the Company’s peer
group for the year ended December 31, 2023 (the “2023 Peer
Group”). The 2022 Peer Group consists of CCA Industries, Inc.,
Colgate-Palmolive Co., Estée Lauder Companies, Inc., Kimberly
Clark Corp., Natural Health Trends Corp., Procter & Gamble Co.,
Revlon, Inc., Stephan Co., Summer Infant, Inc. and United Guardian,
Inc. The 2023 Peer Group also includes Estée Lauder Companies,
Inc. and Procter & Gamble Co. and replaces all other companies
with e.l.f. Beauty, Inc., Coty Inc., L’Oréal SA, LVMH Moët Hennessy
Louis Vuitton, Natura &Co Holding SS, Olaplex Holdings, Inc., and
Shiseido Co Ltd. The Company changed its peer group in order to
reflect the current competitive landscape in our industry more ac-
curately. The graph assumes that the value of the investment in our
common stock and each index was $100 at the beginning of the pe-
riod indicated in the graph, and that all dividends were reinvested.
the market for our common stock
Our Company’s common stock, $.001 par value per share, is trad-
ed on The Nasdaq Global Select Market under the symbol “IPAR”.
The following table sets forth, in dollars, the range of high and low
closing prices for the past two fiscal years for our common stock.
High Closing Low Closing
Fiscal 2023 Price Price
Fourth Quarter
147.71
121.48
Third Quarter
150.70
129.06
Second Quarter 157.59
125.60
First Quarter
143.87
96.65
High Closing Low Closing
Fiscal 2022 Price Price
Fourth Quarter
99.35
74.26
Third Quarter
86.78
70.02
Second Quarter
89.45
64.74
First Quarter
106.82
80.22
As of February 9, 2024, the number of record holders, which
include brokers and broker nominees, etc., of our common
stock was 25. We believe there are approximately 47,503 bene-
ficial owners of our common stock
Dividends
In February 2021, our Board of Directors authorized an annual divi-
dend of $1.00 per share, payable quarterly. In February 2022, our Board
of Directors authorized a 100% increase in the annual dividend to $2.00
per share and in February 2023 the Board of Directors increased the
annual dividend to $2.50 per share. Just recently, in February 2024, the
Below is the list of data points for each year that corresponds to the lines of the above graph:
12/18
12/19
12/20
12/21
12/22
12/23
Inter Parfums, Inc.
100.00
112.73
94.40
168.99
156.49
237.77
NASDAQ Composite
100.00
136.69
198.10
242.03
163.28
236.17
2022 Peer Group
100.00
137.57
160.49
193.85
173.59
161.94
2023 Peer Group
100.00
142.28
167.60
202.03
171.31
168.21
corporate and market information
$300
$250
$200
$150
$100
$50
$0
12/18
12/19
12/20
12/21
12/22
12/23
Inter Parfums, Inc.
2022 Peer Group
Nasdaq Composite
2023 Peer Group
INTERPARFUMS, INC. 2023 ANNUAL REPORT
INTERPARFUMS, INC. 2023 ANNUAL REPORT
103
DIRECTORS AND EXECUTIVE OFFICERS
Directors
Jean Madar
Chief Executive Officer,
and Chairman of the Board of Directors
Inter Parfums, Inc.
Philippe Benacin
President, and Vice Chairman of the
Board of Directors, Inter Parfums, Inc.
Chief Executive Officer,
Interparfums SA
Michel Atwood
Chief Financial Officer
Inter Parfums, Inc.
Philippe Santi
Executive Vice President
Chief Financial Officer
Interparfums SA
Francois Heilbronn
Managing Partner M.M. Friedrich,
Heilbronn & Fiszer
Robert Bensoussan-Torres
Co-founder of Sirius Equity,
a retail and branded luxury goods
investment company
Gérard Kappauf (“Kappauf”)
Chief Executive Officer & Creative and
Editorial Director of the K Groupe,
which owns Citizen K Magazines in Paris
as well as Enkore Studio in Dubai.
Véronique Gabai-Pinsky
President of Startup Specialty
Fragrance Company and Former President,
Vera Wang Group
Gilbert Harrison
Chairman, Harrison Group, Inc.
Founder and Chairman Emeritus
Financo LLC
Executive Officers
Jean Madar
Chief Executive Officer,
and Chairman of the Board of Directors
Inter Parfums, Inc.
Philippe Benacin
President, and Vice Chairman of the
Board of Directors, Inter Parfums, Inc.
Chief Executive Officer,
Interparfums SA
Michel Atwood
Chief Financial Officer
Inter Parfums, Inc.
Philippe Santi
Executive Vice President
Chief Financial Officer
Interparfums SA
Frédéric Garcia-Pelayo
Executive Vice President
Chief International Officer
Interparfums SA
Corporate Information
Inter Parfums, Inc.
551 Fifth Avenue
New York, NY 10176
Tel. (212) 983-2640
www.interparfumsinc.com
European Operations
Interparfums SA
10 rue de Solferino
75007 Paris, France
Tel. (1) 53-77-00-00
Interparfums Italia, Srl
Piazza della Repubblica, 6
50123 Firenze, Italy
Auditors
Mazars USA, LLP
135 West 50th Street
New York, NY 10020
Transfer Agent
EQ-American Stock Transfer
and Trust Company
6201 15th Avenue
Brooklyn, NY 11219
directors and executive officers
104