Company: IPAR
Filing Date: 2025-05-05
Form Type: 10-Q
Source: 0001753926-25-000738
Chunk: 8

Company: INTERPARFUMS INC
Filing Date: 2025-05-05
Form: 10-Q
Item: Part I, Item 2
Chunk 8
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 of this change is the impact of our unrealized gains and losses on marketable securities where we had recorded an unrealized loss of $0.7 million in the first quarter of 2025 and an unrealized gain of $1.4 million in the first quarter of 2024. Changes in interest expense and interest income were relatively flat year-over-year.  

Interest expense is primarily related to the financing of brand and licensing acquisitions as well as our headquarters in Paris. Long-term debt including current maturities aggregated $150.8 million and $157.3 million as of March 31, 2025 and December 31, 2024, respectively. Interest expense was $1.5 million in the three months ended March 31, 2025 compared to $1.8 million in the prior year period. 

We enter into foreign currency forward exchange contracts to manage exposure related to receivables from unaffiliated third parties denominated in a foreign currency and occasionally to manage risks related to future sales expected to be denominated in a foreign currency. Approximately 50% of net sales of our European based operations are denominated in U.S. dollars. Gains and losses in derivatives designated as hedges are accumulated 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 the three months ended March 31, 2025 and 2024.

Interest and investment income represents interest earned on cash and cash equivalents and short-term investments and realized and unrealized gains and losses on marketable equity securities. Interest income was $1.3 million in the three months ended March 31, 2025 compared to $1.6 million in the prior year period. As of March 31, 2025, short-term investments also include approximately $7.3 million of marketable equity securities of other companies in the luxury goods sector. In the first quarter of 2025, the Company had unrealized losses on these securities $0.7 million on these securities compared to unrealized gains of $1.4 million for the three months ended March 31, 2024.  

Income Taxes

Our consolidated effective tax rate was 24.5% and 23.9% for the three months ended March 31, 2025 and 2024, respectively. The effective tax rate for European based operations was 25.5%