Good day everyone. And welcome to the Movado Group Inc. Fiscal First Quarter 2019 Earnings Call. As a reminder, today's call is being recorded and may not be reproduced in whole or in part without permission from the Company. At this time, I would like to turn the conference over to Rachel Schacter of ICR. Please go ahead Ma'am.

Thank you. Good morning, everyone. With me on the call is Efraim Grinberg, Chairman and Chief Executive Officer and Sallie DeMarsilis, Chief Financial Officer. Before we get started, I would like to remind you of the Company's Safe Harbor language, which I am sure you’re all familiar with. The statements contained in this conference call, which are not historical facts, maybe deemed to constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual future results may differ materially from those suggested in such statements due to a number of risk and uncertainties, all of which are described in the Company's filings with the SEC, which includes today's press release. If any non-GAAP financial measure is used on this call or presentation of the most directly comparable GAAP financial measure to this non-GAAP financial measure will be provided as supplemental financial information in our press release. Now, I would like to turn the call over to Efraim Grinberg, Chairman and Chief Executive Officer of Movado Group.

Thank you, Rachel, and good morning everyone. I would like to welcome all of you to Movado Group's first quarter conference call. I will first provide some highlights of the quarter and discuss our strategic initiatives and then Sallie will review our financial results. We will then open the call up to questions. We are extremely pleased to report a strong start to the year driven by a double-digit growth in sales and adjusted earnings per share. Sales surpassed our plan growing 28.1% to a $127 million and 22.2% in constant currency. The quarter included $2.2 million of additional revenue from the timing shift based on the new accounting standards for revenue recognition. This shift will continue to impact each quarter for the balance of the year; however, for the year, we expect it will be revenue neutral. Sallie will review this in greater detail. Our adjusted operating profit for the quarter was $8.9 million versus $2.7 million last year. Our adjusted earnings per share grew to $0.37 versus $0.01 last year. We also continue to maintain a very strong balance sheet with the cash position of $177 million while repaying all of our bank debt. Our teams did a tremendous job of managing our inventory levels. We do see inventory by $1.3 million from the same period last year despite the strong sales growth. Now, I would like to spend a few minutes on our key strategic priorities for fiscal 2019. Coming off a strong finish to last year, our teams around the world have been energized to build on that momentum for our brands and regions. We are continuing to make progress on our digital transformation to become a leading omni-channel consumer driven large company. In our regions, our domestic wholesale business in Movado continues to perform well…

Thank you, Efraim, and good morning everyone. For today's call, I will begin with a review of our first quarter financial results and balance sheet and then discuss our outlook. Before I begin, I would like to point out the special items included in our first quarter results for fiscal 2019 and fiscal 2018. Our press release also describes these and items includes a table of GAAP and non-GAAP measures. Movado Group acquired Olivia Burton on July 3, 2017 included in the results for the first quarter of fiscal 2019 was $767,000 of non-cash amortization of acquired intangible asset. After-tax, the charge related to the acquisition equates to $621,000 or $0.02 per diluted share. Our GAAP results for the first quarter of fiscal 2018 included $6.3 million pre-tax charge which equates to $4.4 million after-tax or $0.19 per diluted share in connection with our cost savings initiatives. The balance of my remarks will exclude these special items just discussed. Now turning to our results, we are very pleased with our broad-based sale growth across each of our categories, owned brands, licensed brands and retail. The Company adopted the new revenue recognition accounting standard as of February 1, 2018, which resulted in shifts in timing related to the recognition of returns and markdowns between quarters. As Efraim mentioned for the first quarter, our sales were favorable by $2.2 million dollars due to the net decrease in returns and markdowns would have historically been recorded in this period. This change impacted operating income by $666,000 and after-tax equated to $0.02 per diluted share. We anticipate a corresponding offset later this year. Sales for the first quarter were above our expectations and increased $27.9 million or 28.1% to $127.1 million. Our newest brand contributed to this growth as we did not own it…

Thank you. [Operator Instructions] We will first go to Oliver Chen with Cowen and Company.

The comments around international, building an international team are interesting. What are your thoughts there in terms of what you're looking to do and what opportunities you see there? And then I'm also just curious about the states, the U.S. wholesale department store channel. What are your thoughts on the levels of inventory here? Are you happy with the sell-through versus selling rates?

So, I'll take those Oliver. On the first one, the investment is really behind some people and growing markets as well as increased marketing expense behind our brands, and we're seeing very strong momentum in those markets and you can see that by our international sales growth in the first quarter. And on the U.S. side, we're seeing improving trends in the U.S. department store business. We believe that overall those businesses are improving both in the watch category and overall, and we're' cautiously optimistic about the trends of those businesses in the second half of the year. And with those improving trends, the retailers, I think, are stocking their positions appropriately.

Okay and it's been encouraging regarding the investments in the digital center of excellence. As you had more time with these initiatives, what are your thoughts on the priorities there and the progress you've made and what you see ahead?

Sure, it's very early on for us, so we just really launched that at the beginning of this fiscal year and we're in the process of staffing that area and placing a greater emphasis on digital throughout the Company. So, I think this year will really predominantly be an investment year in that area, and I would expect to begin really seeing a real impact towards the latter half of this year and the beginning of next year.

And our other question was regarding M&A as from, what are your general thoughts on M&A as a framework in terms of looking for ROIC accretive deals or opportunities? What would make sense for you as you think about organic versus M&A driven growth?

I think we have both opportunities to drive ourselves organically as well as we're still proving out our Olivia Burton model and that's been a great acquisition for us, but it's very early in that stage. So, we have a very strong balance sheet that really does continue to give us a certain amount of flexibility in the marketplace as well.

[Operator Instructions] We'll next go to Edward Yruma with KeyBanc Capital Markets.

Couple of quick ones from me. First, lots of innovation at core -- in the core Movado product portfolio. Is the sales growth or sales improvement being driven out of kind of the new product lines to heritage or the core? And then I guess as a follow-up maybe a little bit of color on Minkoff since I think that underperformed a little bit?

So, I think I'll answer the first part about Movado is really -- we're seeing actually revitalization in our core business and strong -- continued strong performance in bold, heritage is still very limited collection, and we're also seeing improving trends in our e-commerce business over the same period last year, so we're excited about that. Rebecca Minkoff is still a very small part of the overall business and really a brand that we’re incubating right now. We actually noted it has a very limited and exclusive distribution. And as that actually makes it a very interesting opportunity for the Company and it’s a millennially based brand, which also makes it an exciting opportunity for us.

And it looks like there are no further questions at this time. So, I would like to turn it back over to management for any additional remarks.

Again, thank you for joining us for our first quarter conference call. And we look forward to seeing you again at the end of the summer for our second quarter. Thank you.

And that does conclude today's conference. We thank you everyone again for their participation.