Elizabeth Arden raises operating cash flow guidance

10 May '10

4 min read

Elizabeth Arden, Inc., a global prestige beauty products company, announced financial results for its third fiscal quarter ended March 31, 2010.

Third Quarter Results
For the quarter ended March 31, 2010, the Company reported net sales of $217.0 million, an increase of 6.7%, as compared to the third quarter of the prior fiscal year. Excluding the favorable impact of foreign currency translation, net sales increased by 2.1%.

Net loss per diluted share for the third fiscal quarter ended March 31, 2010 was $0.14, as compared to a net loss per diluted share of $0.13 for the prior year period. Excluding restructuring and other expenses associated with the Company's Global Efficiency Re-engineering initiative, net loss per diluted share for the three months ended March 31, 2010 was $0.11, as compared to a net loss per diluted share of $0.19 for the prior year period. A reconciliation between GAAP and adjusted results can be found in the tables and footnotes at the end of this press release.

E. Scott Beattie, Chairman, President and Chief Executive Officer of Elizabeth Arden, Inc., commented, "Results for the third quarter were in line with our expectations. We continue to see consistent improvement in our U.S. mass fragrance and international businesses, with sales increases of 7.6% and 13.5%, respectively. Sales were led by the strong performance of our core brands, including the Elizabeth Arden branded products and the Juicy Couture and Britney Spears fragrances."

Mr. Beattie continued, "I am pleased with the traction we are gaining from all of the initiatives we are implementing to systematically improve the performance of our business, which is evident in our results. As compared to the third quarter of last fiscal year, gross margins improved by 440 basis points and adjusted EBITDA margins improved 170 basis points. In addition, inventories declined by $86 million, or 24%, credit line borrowings were reduced by $84 million and trade payables decreased by $38 million as compared to the March 2009 balances. These improvements contributed to a $91 million increase in year-to-date operating cash flow. As we look towards fiscal 2011, we expect these initiatives to continue to contribute to improved earnings and return on invested capital and a further de-leveraging of our balance sheet."

Nine Month Results
For the nine months ended March 31, 2010, the Company reported net sales of $875.5 million, an increase of 2.1% as compared to the prior year period. Excluding the favorable impact of foreign currency translation, net sales increased by 0.2%. Net income per diluted share was $0.60, as compared to a loss of $0.09 per diluted share for the prior year period. Excluding restructuring and other expenses associated with the Company's Global Efficiency Re-engineering initiative, net income per diluted share was $0.74, as compared to net income per diluted share of $0.53 for the prior year period. The prior year period also excludes expenses and non-cash charges related to the Liz Claiborne license agreement.

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