Movado Group, Inc. (MOV) announced, in fiscal 2018, the company anticipates net sales will be in a range of $515.0 million to $530.0 million and operating income will be approximately $50.0 million to $55.0 million. The company anticipates net income to be approximately $33.0 million to $36.3 million, or $1.40 to $1.55 per share.
Efraim Grinberg, Chairman and CEO, stated: "Looking at fiscal 2018, we anticipate the retail environment will remain difficult. We are seeing a significant shift from brick and mortar to e-commerce and a continuing challenged fashion watch market in the United States. As a result, we are taking a more conservative view for fiscal 2018 compared to fiscal 2017 and are implementing certain cost savings initiatives."
Following a review of the company's current cost structure, Movado Group is implementing a number of cost savings initiatives by consolidating certain operations and streamlining functions to reduce costs and improve profitability. The cost savings initiatives include a reduction in the workforce predominantly impacting the North American and Swiss operations.
The company expects to realize approximately $12.0 million of savings in fiscal 2018 and estimates approximately $15.0 million in on-going annual pre-tax savings from these initiatives, with the majority being in general and administrative expenses. The company expects to record a pre-tax charge in connection with the completion of these initiatives in a range of approximately $7.0 million to $10.0 million, predominantly in the first quarter fiscal 2018 with the balance throughout the remainder of the fiscal year.
Movado Group reported fourth-quarter net income of $5.2 million, or $0.22 per share, compared to net income of $7.9 million, or $0.34 per share, for the same period in the prior year. Adjusted net income was $9.2 million, or $0.40 per share in the fourth quarter of prior fiscal year. Fourth-quarter net sales decreased 8.7% to $130.8 million compared to $143.3 million, prior year. Net sales on a constant dollar basis decreased 7.5%.
The company also announced that on March 20, 2017, its Board approved the payment on April 14, 2017 of a cash dividend in the amount of $0.13 for each share of the company's outstanding common stock and class A common stock held by shareholders of record as of the close of business on March 31, 2017.
by RTT Staff Writer
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