Greetings, and welcome to the Inter Parfums Inc. Third Quarter 2014 Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Russ Greenberg, Chief Financial Officer and Executive Vice President of Inter Parfums. Thank you, sir, you may begin.

Thank you, operator. Good morning, and welcome to our 2014 third quarter conference call. Following the financial review, Jean Madar, our Chairman and CEO, will provide a business overview, and then we will move on to your questions. Before proceeding further, I want to remind listeners that this conference call may contain forward-looking statements, which involve known and unknown risks, uncertainties and other factors that may cause actual results to be materially different from projected results. These factors include, but are not limited to, the risks and uncertainties discussed under the headings Forward-looking Statements and Risk Factors in our Annual Report on Form 10-K and the reports we file from time to time with the Securities and Exchange Commission. We do not intend to and undertake no duty to update the information discussed. In addition, Regulation G, clarifications for the use of non-GAAP financial measures, prescribes the conditions for use of non-GAAP financial information in public disclosures. We believe that the presentation of the non-GAAP financial information that is included in this presentation is important supplemental measures of operating performance to investors. The information required to be disclosed for the presentation of non-GAAP financial measures is disclosed in our September 30, 2014 quarterly report on Form 10-Q, which has already been filed with the Securities and Exchange Commission. This information is available on our website at www.interparfumsinc.com. When we refer to our European-based operations, we are primarily talking about sales of prestige fragrances conducted through our 73% owned French subsidiary, Inter Parfums SA. When we discuss our United States operations, we are primarily referring to sales of prestige and specialty retail fragrance products, as well as travel amenities, all conducted through our wholly-owned domestic subsidiaries. As a reminder, in the 2012 fourth quarter, our Burberry license was terminated, and Burberry…

Thank you, Russ. I am Jean Madar. Good morning everyone. Once again we appreciate your participation on today’s conference call. Some of our more recent launches are showing great promise. For example, Jimmy Choo Man, our first men's scent for the brand has achieved the higher than expected order intake and it looks like favorable trends are continuing. We are also very pleased by the early success of our new Agent Provocateur scent for women called Fatale, which was launched exclusively at [indiscernible] in the US and on the shape of [indiscernible]. While subject to change, our plan for 2015 points to effective new product launch schedule. We will introduce Icon by Dunhill in Harrods in January 2015, then in duty free locations in Europe, Russia [indiscernible] with global rollouts as the year unfolds in 2015. As we mentioned in the past, our first Oscar de la Renta and a new women’s scent for Montblanc are underway for 2015. [Indiscernible] Balmain and Van Cleef & Arpels. Also a men and women dual is being prepared for Boucheron. The Shanghai Tang collection will also be in distribution with a different style for Chinese New Year in February, also in the work are [indiscernible]. As Russ referenced earlier, [indiscernible] has become a modern bar of our US operation which is added in the more recent edition to our US ramp of the brand – with Oscar de la Renta, Agent Provocateur, Van Cleef and Shanghai Tang. As a consequence, our traditional specialty scent business where we produce fragrance and liquid products for domestic growth represent a greater percentage of the mix there. Today industrial several of these brands are pricing both. So while we are looking to partner with other specialty retailers, the traditional model may make way for our new ones depending upon the brand and its geographic of international origin. While it is too early to speak about the growth opportunities for our business – we have a very viable and brand profitable, a global reach in 100 countries – and an extremely strong balance sheet. Our stellar reputation creates upon our track record of developing and commercializing successful new products that enhance the brand of our fragrance partner and expand the advantage. As we have done in the past, we will be releasing our sales and earnings guidance for 2015 after the market close on Monday November 13. And Lisa, we will take the questions. Since this is our last conference call for the year, and I want to wish all of you the very best of the holiday season and the coming year. So with that, operator, please open the line for questions.

(Operator Instructions) Our first question comes from the line of Wendy Nicholson with Citi Research.

Hi. My first question has to do with the cash balance and just in terms of your outlook for M&A. I know you're looking to acquire potentially some new brands and some new licenses, but do you have a timeframe in mind where let's say we're sitting here six months from now or 12 months from now and you haven't used any of the cash. Would you consider another dividend or buyback or how do you think about that?

As we've said in the past, we certainly haven't really been sitting idly. We have been evaluating several different opportunities as they appear. Unfortunately, we have not of course made any acquisitions to date which would allow us to use any sizable portion of the cash that we have. And the potential on the uses of that cash is really something that is unknown. We do know that the most accretive use of this cash would be to reinvest it into our business through either new licenses ventures or outright acquisitions. And our desire is to use to have that particular use as the use for these products. More as the priority since we know that would be most beneficial for our overall business. And I don't believe any specific timeframe has been specified. We certainly want to be open and available for these opportunities as they come about. I hope that sheds some light. But we really have not determined a specific timetable that we have to use by certain date. The small special dividend that we did at the end of last year was really a one-time thing at this point in time. And certainly no acquisitions were made and we don’t do anything more on that regard.

But then can you talk a little bit more just generally about the environment you are seeing because the 14% increase in sales in our ongoing brands is so much better than what we are seeing from other fragrance players and I know you’ve got greater new products out there but in terms of as we go into holiday your confidence in the environment generally particularly the Western Europe seems to be very next, your confidence in that strong momentum continuing and on the advertising side, I know you’ve talked about increasing the advertising spending all year, that was not a surprise. But is that simply to promote the new brands that you are launching or is that in light of maybe increased competitive activity?

Yes couple of different questions here. So I will try to have each one. First with respect to the sales. Keep in mind that third quarter sales were up 6%, some of the difficulties that we see with respect to some of our competitors is a little bit more so on the mass market side advantages. But also just keep in mind we are – overall we are up 14% for the first nine months, the guidance is 15% for the year, that improved a little bit on organic and little bit of new product, Oscar de la Renta of course as you know was one of the brands in our portfolio that we did not have in 2013, and that represented approximately 21 million in sales for 2014. So all in all from an organic standpoint, we are probably in the low mid single digit type of a growth this year. I think that is a little bit reflective of the difficult economies that do exist in certain parts of the world. When we report our results at the end of – for the third quarter, we indicated that most major markets have done fairly well – have a global territories. The difficult markets, Eastern Europe, although slightly better in the third quarter than it was in the first half of the year it’s still a very difficult market. And in addition, Asia is also not quite growing to the extent of the rate that we saw in 2012 and 2013. So far into the nine months were up less than 5% in Asia, and we had an overall 14% growth rate.

Yes, I would like to – I think it’s an important question. So we’ve tried to give you a smell of the ongoing brands. Markets are of course very saturated, the first four months we did when we increased our services, 6% I think is – they are more of a projection. But it’s also a reflection of certain difficulties in the important growing markets of fragrances, China and Asia, Russia. Also in Russia there was a problem with foreign currency, the ruble versus a dollar, lost 20% of de-valuation, this will have an impact on the cost savings from Eastern Europe. Our business in China is not growing as thought – so we have seen that [indiscernible] we are doing – take advantage and the other thing that we have to take into account is that there was a weakness in the euro and the strength in the dollar recently in the last part of the third quarter, we’re going to see the impact more in the fourth quarter, at least in the half negative impact on sales and a positive impact on line -

That’s correct. As I have always indicated, because of the fact that our European operations possibly $40 to 50% of their sales are denominated in dollars, while all of their costs are maintained in euro, we see that – we normally see a little bit of a gross margin improvement as a result of that, whereby just translating the euro sales to dollars, from a sales standpoint, just have a negative effect.

Our next question comes from the line of Joe Altobello with Raymond James.

Hi, in terms of the FX impact you guys are seeing, and if you look at the strengthening of the dollar, just the middle of the year, back of the envelope, I came up with about a $10 million revenue headwinds for the back half and obviously this morning you said you’re still comfortable with the $495 million in terms of sales for this year. But obviously that revenue number should come at a higher margin and yet because – you’ve kept your EPS number unchanged. So are you spending back some of the higher margin sales that you are having right now?

There is a little bit of that going on. But it’s very difficult to pinpoint exactly how our gross margins are going to play. Because you are – when you are in an environment as the dollar you see any strength, you have selling pressures that sometimes mitigate some of that gains that you get from the gross margin. So it’s very difficult to pinpoint that to exact dollar. Whereas when you take example – fairly simple, you know you will come up with wide average rate. Most of what we see in the strength of this euro, the US dollar recently, keep in mind that most of that will be in the fourth quarter, CapEx really did not play because it rolled in the third quarter, the average is strengthening, was around 1.32 for both the 2013 period as well as 2014 period. So kind of look up, as we move forward, I think the most important thing in the whole comment though is that we have not reduced those sales guidance, which really implies an increase as you said in our guidance for this year as we move on.

And then in terms of Hong Kong, last week I think Laura mentioned that the demonstrations that are going on there have impacted their business pretty significantly. Are you seeing any impact as well?

Yes, we see – difficult to say that just the demonstration has a direct impact on our guidance. Again from the macro economic point of view because of situation – when we are going through to release our flow chart profitable – next week in November 18, we will definitely take into concern in the Middle East. Pressure is in China and making the long call, as you suggest it’s a very strong growth market. For Easter, Chinese customer in traveling today in Hong Kong, Korea, so you have an impact on our benefits. So we are putting on these together in our virtual half of come thing – I don’t want to be conservative but we need type of environment. We need to be at all kept for sure.

Just one, last one if I could in terms of Montblanc, it was up I guess 40% in 2012, and ‘13, 40% year to date, which strikes me – it’s not only impressive but remarkably consistent. So how much is less in that brand – I mean is there a significant amount of growth opportunity in Montblanc at this point?

I really like it, because Montblanc is the shining star of our product growth figures. Legend, the growing product that – in 2011, it’s still growing in 2014, so three years after the launch, with main production of new fragrances in Montblanc, which is a great, great time of reaching the market expectation, we think and the way we have built our – Montblanc will still grow, maybe higher than the other brands in the [cost of goods]. So we have seen a little drop of energy – same thing for the Jimmy Choo – second quarter super opportunity, it’s not supplemented in the third quarter, I think we are able to change the market share opportunity. So Lanvin, Jimmy Choo and Montblanc, which is a mixture of new launches, sometimes – so it’s probably a mixture.

Our next question comes from the line of Stephanie Wissink with Piper Jaffray.

We also have a couple of questions. Russ, just one probably, it’s for you. If you could just talk a little bit about the advertising and promotion spend. Give you some insights into your digital assets that maybe some of the more traditional advertising that you have run has been effective? And just secondly maybe a bigger question around – I think you referenced earlier a little a bit of de-saturation in terms of choice counts in the marketplace around fragrances. Could you give us some sense of how you proceed through the retirements of the brands and then maybe nearing end of life and how you think about the replacement cycle of some of that revenue?

Go ahead, Russ.

Well you are thinking about the additional assets and number of specific – just to go from some numbers, not just that we kind of while we wait along. In the third quarter, we spent approximately 15.5% on advertising and promotion as a percentage of sales. That compares to around 16.5% in 2013. As we move towards the fourth quarter, I also mentioned that the fourth quarter usually our market, our quarter and overall spend and where effecting the set of approximately 24% to 25% of sales on advertising and promotion end of fourth quarter and that will result in an overall approximately 17% full year spent on A&P as a percentage of sales. And I don’t remember but last year from continuing brands we’ve had approximately 22% of sales in the advertising and promotion. So on a comparison basis we are looking at approximately 17% this year.

We have – in order to maintain growth and to increase market share, we will compete and – we are seeing that in our percentage of product – and also in fiscal quarter of next year we do have – we spent it across it’s not known or attractive cheer – this is a mostly news for Asia, for more than 50% of our wells are at the [indiscernible]. Because it’s a way for us to reach the second tier cities and third tier cities – significant way to adopt that and otherwise I would initial – because we are most of the states our pick up at least through limited, we generated low – enough to lean and make sales for anyone. So all our franchise are under review when it productive, we will be continuing some fragrance and introduce new ones – we lot of new additions, not that too continue to investors even --

Yeah the only thing I want to add on protecting products, is keep in mind that many of the brands that we have in our portfolio, brands that we’ve taken over from former licensees, and in many cases that line itself in value of retailing and rejuvenation. Montblanc is the first and we pretty much did continue to almost all of the risks and fragrances that exist in that line. The whole idea – when we launch [indiscernible] we will be discontinuing 75% of the recent fragrance that – we licensee of PNC. That’s an ongoing part of the evaluation of our businesses but we are progress that we create – we try not to but we are not a 100% perfect, not every brand that we launch or every fragrance that we launch is the success that we want today and it’s the common process to overall – to revaluate to work with that portfolio.

Our next question comes from the line of Linda Bolton-Weiser with B. Riley Caris.

Just a little question on the numbers first. Your royalty was up year over year in the fourth quarter – for the third quarter and – against I am now understanding that, because Lanvin which is your one own brand was actually up where has it had not been growing as much earlier year. So I would say favoably effective royalty rate sales, so that’s my fist question.

You are correct, that loyalty rate high in the third quarter and we’ve indicated in the quarter we reported that was highlighted yesterday, there was a small – not organic basis – a small judgement for our liability to our former licensee but in connection with the wealthy accrual. And that is – third quarter this quarter. While narrowly we have -- running of its lower, this quarter came to 7.25 of sales, it normally sould be around 6.3, 6.4% just going up 5% net sales turning about to slide presentation. You are absolutely right. It is the 100% adjustment based on evaluation of some estimates that we have.

I am just curious kind of strategically what you are thinking about the US base, it seems like it’s become more similar to the European business in that sense that it has these brands, I am just curious about what you are doing with your partnership with retailers. Are you still pursuing that strategy and GAAP now, is that –are the sales mostly international or do you still have a saes base of some increase in the US, on the GAAP and in the annual report.

First, just last question one, just with respect to GAAP and non-GAAP, the non-public --where your top products exchange state discontinued in the United States as well as international, the business, we have at least for the past year only selling on international bases and that will continue for 2015. If it’s not a significant number for us, whether it will continue to go in that, more likely than not we will not beyond 2015. Well, the overall focus with respect to specialty retailers, it’s really an opportunity situation, if we have any opportunities to open up new litigation account, we are certainly not averse to selling. One of the biggest advantages that we’ve seen though is the ability to take some of these specialty retail and moving into international channel and that has really what kind of opens up the door, even potential licensing activity and brands or not, typically no necessary retailers.

Our business in the US also has all the advantage in loan, how flag, shoe, US department store, earter, for us US capital not the right capital America are all over performing. So we see no internet at all, we see a string of activities in the US – and we of course – very high in the US, so the US – is the most profitable segment, but besides that gaining visibility for market, due free where we make more money, I think that demand draft – 25% today of our sales are in the US.

Our next question comes from the line of Frank Camma with Sidoti & Company. Frank Camma - Sidoti & Company: Just one clarification, on the promotion spend here in the fourth quarter, as it compares to last year. Obviously you are projecting it down pretty significantly on both percentage and absolute rates. Is that simply because of the number of launches and I just didn’t catch that part, is it the timing of those launches or the support you’re putting through this year –

It has a little to do with the lot of different details. But most important, if you remember it last year as we spurred the biggest brand should we use Montblanc as – there is an operator that we were seeing, we’re much greater than we have originally projected, and that’s what led to the increase in our guidance, six, seven times throughout 2013. In Agent Provocateur, we said, once we see that our sales momentum is moving greater than what we originally planned, we try to grow more money behind it to keep that momentum growing. As we move into 2014, as yes we have stayed with our guidance throughout the year and there is an implied increase of course because of the FX exchange rate, but we’re not seeing – it’s much more in line with our existing expectations. So we’re not going to grow more money behind that because we need to be able to sustain very much, and we think that a 24, 25% of sales for the fourth quarter is high, and those numbers just imply a 17, 17.2% or so for full year, so that’s where denominator coming out that we would evaluate 2015 once we start putting our finance together for 2015. Frank Camma - Sidoti & Company: Now the other question – the tax rate obviously better because the way you had booked in income, is that a permanent shift, or a one-time thing, how should we think about that?

Some of it will be ongoing, especially because so long as the New York state and New Jersey continue to change the allocation factors – so could continue the allocation which concentrates much more so than property or other type of factors, that is what accounted for most of what we saw in the third quarter. But keep in mind there is always somebody right around –35% tax rate for the year, we may see a slight improvement but we’re all going to see an adjustment, that is going to be one, usually in September when we actually true up if you will, because we actually file our returns in September, so we know exactly what the end results are going to be, we’re going to have to true up in September. And I think that overall you are going to see a little bit of improvement as time goes on with the overall effective tax rate.

It appears we have no further questions at this time. I would now like to turn the floor back over to management for closing comments.

Thank you very much operator and again thank you all for your questions and patience on the conference call, whether you are right on the call or listening via webcast. If anyone does have questions, as usual I am available by phone. Thank you. And have a great day.

Ladies and gentlemen this does conclude today’s teleconference. You may disconnect your lines at this time. Thank you for your participation and have a wonderful day.