Hello, and welcome to Inter Parfums, Inc. 2021 annual meeting of shareholders. Please note that today's meeting is being recorded. It is now my pleasure to turn today's meeting over to Jean Madar, Chairman. Mr. Madar, the floor is yours. Good morning. Will the meeting please come to order? As most of you know, I'm Jean Madar, Chairman of the Board and Chief Executive Officer of Inter Parfums Inc. I would like to take this opportunity to welcome all of you to the 2021 virtual annual meeting of stockholders of Inter Parfums. This is our second ever virtual annual meeting. We are holding this meeting virtually due to public health concerns caused by the recent surge of COVID-19, as well as the travel, social distancing, and meeting restrictions imposed by federal, state, and local governments. Therefore, we have decided to hold our annual meeting solely by means of an audio conference that is being broadcast live via a webcast. I will act today as the chairman of the meeting, and Joseph Caccamo, our general counsel, will act as secretary of the meeting. Before proceeding with the business of the meeting, there are certain technical legal matters which we must attend to in order to ensure that we are conducting a duly authorized meeting. As soon as these technicalities are out of the way, I will introduce to you the officers and directors of the company who are present here today, and then I will describe the matters for your consideration and action. The company has designated Sharon Bajagrou of American Stock Transfer & Trust Company as the Inspector of Election, who has signed and sent us her oath of Inspector of Election. Mr. Chairman, I have received her signed and notarized oath of the Inspector of Election. The record date fixed by the board of directors for the determination of stockholders entitled to vote at this meeting is August 9, 2021. The Inspector of Election has a certified list furnished by American Stock Transfer & Trust Company, the company transfer agent of the holders of common stock of the company as of the close of the business on the record date. Will all stockholders present and all holders of proxies for other stockholders please, if they have not already done so, submit their respective votes online for tabulation. Will the Inspector of Election kindly read the report of the number of shares of common stock of the company represented at the meeting, either in person or by proxy, and indicate whether there is a quorum of stockholders present in person or by proxy at this meeting. Sharon? Yes. Thank you, Mr. Chairman. I certify that there are 30,072,632 shares, which is approximately 95% of the Inter Parfums common stock represented by proxies at this meeting. Okay, we have 95% of the shares that have been voted. The report of Inspector of Election indicates that they are present at the meeting in person or represented by proxy, the holders of a majority of the total number of shares of common stock of a company issued and outstanding, and entitled to vote at this meeting. Therefore, there is a quorum present, and the meeting is competent to transact business. Will the secretary please give his report. Secretary, Joe? Mr. Chairman, as secretary of the meeting, I have in my possession. Joe, I cannot hear you. Can you hear me? Test, one, two. Yeah, go ahead. Go ahead, Joe. Okay. Mr. Chairman, as secretary of the meeting, I have in my possession a copy of the notice of annual meeting of stockholders dated August 13, 2021, concerning the matters to be considered and acted upon at this meeting, a copy of the proxy statement and the form of proxy, together with the transfer agent's affidavit of mailing. Before proceeding further, I would like to introduce to you the persons who are here today. I am Jean Madar, the Chairman of the Board and Chief Executive Officer, and I have next to me Russ Greenberg, who is a Director of the company and also Executive Vice President and Chief Financial Officer. Joseph Caccamo is the company counsel, and Sharon Bajagrou is from American Stock Transfer. Let's look at the first proposal. The first order of business is the election of Directors to hold office for a term of one year until the next annual stockholder meeting and until their successors are elected and qualified. The floor is open for nomination of Directors. I nominate the following individuals: Jean Madar, Philippe Benacin, Russell Greenberg, Philippe Santi, François Heilbronn, Robert Bensoussan, Patrick Choël, Michel Dyens, Veronique Gabai-Pinsky, Gilbert Harrison. There being no other nominations, I declare the nominations closed. Second proposal. The second order of business is to vote for the advisory resolution to approve the compensation of our named executive officer. The following proposal is put forth before the stockholders. Resolved that the compensation paid to Inter Parfums, Inc. named executive officers, as disclosed in accordance with the compensation disclosure rules of the Securities and Exchange Commission, including the sorry, including the compensation discussion and analysis, the compensation table and related narrative disclosure included in the proxy statement of Inter Parfums of this annual meeting is hereby approved. Let's look at the results of voting. We have received the preliminary voting results as of 9:00 A.M. this morning. I understand that due to the fact we are holding the meeting virtually, the final results will be available about now. The final voting result will be reported in our SEC filing due within the next few days. On the basis of the preliminary voting results for proposal one, with about 85% of the votes in, we don't have more than that? 95%. I don't have that. It says 95%. I only have it as 85. Yeah, 95%, Jean. Okay. No problem. With 95% of the vote in, all directors have received an overwhelming majority of the votes for their re-election, ranging from 65% to 99%. Joe, do you have a breakdown by individual? Yes, I will find it in one second, the vote. If he says between 90 and This is a draft document. Yes, Joe? Yes, I'm finding it. one second. Sharon, I can't open the voting. That's okay. I have it right here, and I could just tell you by the directors. Do you want me to say the% per director? Yeah. Okay. For director number 1, this is Jean Madar, we have 98.04%. Ninety-eight- Director number 0.04. Correct. For director number 2, Philippe Benacin, we have 96.43%. Director number 3, Russell Greenberg, we have 93.47%. Director number 4, Philippe Santi, we have 90.4%. Director number 5, François Heilbronn, we have 65.11%. Director six, Robert Bensoussan, we have 99.29%. Director seven, Patrick Choël, we have 83.85%. We have Director Michel Dyens at 99.65%. Veronique Gabai-Pinsky at 92.83%, and then Gilbert Harrison at 99.65%. Impressive. Okay. All right. Thank you very much. This is very helpful, Sharon. Okay. Now we move to the second point. On the basis of the preliminary voting results for proposal two, with about 95% of the votes in, the proposal to approve the compensation paid to Inter Parfums named executives officers, as disclosed in our 2021 proxy, has received an overwhelming majority of the votes for. We have approximately 98% of the votes for, and then it will be approved. Following the close of the formal portion of this meeting, we would like to give you a brief report of events which are occurring in our company, and there are a lot of events. I'm going to let Russ give you an update. We are now at the beginning of October, so we have just finished the third quarter. We have not released the third quarter, but we just finished the third quarter. Russ, can you tell us what's going on? After that, I will give you a little development on the Ferragamo acquisition that we finalized and announced yesterday, and the new license with Donna Karan. I will talk about this part. First, an idea on the state of the business. Jean, first we need to close the formal portion of the meeting. I did. There being no further business before the meeting. There being no further business to be brought before the meeting, the formal part of the meeting is hereby adjourned, we go to a discussion on the business. Thank you. Okay. Thank you. From a financial perspective, as Jean just indicated, the most recent reports we reported was for the three and six-month period ending June. We will be reporting our third-quarter sales towards the end of October, and of course, our third-quarter earnings early in November. Just as a little reminder, the second quarter was a phenomenal quarter for Inter Parfums. We generated net sales of over $400 million, up from just under $200 million in 2020. What was even more impressive is that sales actually rose over 18% from 2019's six-month period ending June. Which shows that we really kind of had a major recovery from the effects of the COVID pandemic that we had felt in 2020. From a earnings standpoint, income from operations for that six-month period topped $90 million as compared to just about $12 million the year before. From an earnings standpoint, we generated earnings of over $50 million for the six months ended June as compared to $7 million for the period before. Same comment with respect to year-to-date income. When we compare it to 2019, we were actually up approximately 61%, reaching, as I said, the $50 million compared to $30 million-$31 million in 2019. As I said, we will be reporting third quarter results. I think what's most important today is really the recent activity from an acquisition standpoint. As Jean mentioned, we've recently announced two deals, I'll let Jean talk a little bit about those deals. I understand that you cannot talk about the first quarter yet because nothing has been announced, even though we have said to many analysts that business is quite strong. What I would like to talk about is first Ferragamo. We have been working on this license for a long time. Ferragamo has been in the fragrance business, not through a license, but directly operated by the Ferragamo fashion house. The Ferragamo fashion house was the owner and the operator of the fragrance business. They decided to license it. It was a very important strategic decision for the Ferragamo family to go to an outside partner, and I want to thank them for their trust and confidence. They chose Inter Parfums because they thought we were the best company to understand and interpret what Ferragamo means. We also committed to keep this business in Italy. When we say keep this business in Italy, it means that the manufacturing of all Ferragamo fragrance will be in Italy. Most of the sourcing of the components that goes into Ferragamo fragrance will be from Italy. In order to support this new activity, we have decided to take over an existing company that was owned by Ferragamo before, that has employees. We have, I think, something like 25 or 30 employees that will work on finance, accounting, marketing, operations, packaging, planning, inventory, et cetera. The deal is effective October 1. We are today in our first week as a Ferragamo licensee. We will continue to do the business that Ferragamo was doing before. We will come up with new products, and the plan is to launch towards the end of 2023, a new blockbuster. The size of the business was not disclosed, we mentioned in the press release that Ferragamo will be in the top five license that the company has. We think that we can strengthen the business of Ferragamo in Paris, where the name is already very well known, and in America, where the name is known, but the distribution is underdeveloped. This is for Ferragamo. Of course, every quarter, we will keep you aware of the development. The company is quite optimistic. This is the first Italian classic fashion fragrance that we have. Of course, we have Moncler, which is also Italian, but I would say Moncler is more lifestyle. Ferragamo is more classic. We will be looking for more businesses, more brands from Italy or from other countries to enrich our portfolio. The second deal that we have signed and announced is the Donna Karan DKNY license agreement. We signed this license agreement with the owner of Donna Karan. It's a public company called G-III. The former licensee was Estée Lauder. They have been doing this for 20 or 30 years, Estée Lauder is, how should I say, closing their division in charge of co-designer fragrance, and Donna Karan/DKNY was part of this division. This deal will be effective July 1, 2022, it will be in nine months from now. We will be the new licensee of Donna Karan DKNY. Estée Lauder will produce some inventory for us, we are sure that there's no disruption in the market, but we'll take over the business officially in July 2022. The DKNY Donna Karan business will have no impact in our 2021 numbers, but will start being included in our sales for 2022. These are two important pieces, two new important additions to our portfolio. The portfolio is now very well-balanced. These are not small acquisitions, because with these two acquisitions, we think that we'll reach the billion-dollar sales in the next, what do we say, worse? Two to three years. Two to three years. Two to three years. Yeah. Apparently, there are some questions. Yeah. The first question that we have for today is from Linda Bolton Weiser. Actually, all the questions are from Linda. Are we seeing any component shortages or supply chain log jams right now? What type specifically? Yeah, I can try to answer. There is a huge disruption on the supply chain. When I say huge, it's something that I've never seen before in my short 40 years of being in this business. Two problems have happened. Our suppliers of components do not have the capacity to produce our needs. Also, when they produce, they have a problem to find either a boat or a truck to bring it to our warehouses. The problem of capacity, coupled with the problem to find the transportation, makes the problem extraordinary. This is not new. We saw it coming beginning of the year. We have increased a lot our demand for inventory, and we have increased in January, February, and March. Thank God we did that in order to protect some of the business. I will say that the first quarter was actually affected. We could have done maybe a little bit more, we shipped most of the orders. We received also at the end of the first quarter, a good amount of components in order to secure a good part of the fourth quarter. We have done three things. We have increased our inventory, increased our future orders. We have taken into account a longer lead time for components. We are sourcing from different suppliers the same components. Let's put it this way. Today, we have almost one and a half to two different suppliers for each of the components that we are using in order not to be in the hand of just one. Even if we do all this, it will have an impact. Definitely, it will have an impact. What we see right now is that the demand for fragrance is way above what we forecasted. Some we are able to ship, some we won't be able to ship. What is important for me is the future. We have decided to carry more inventory going into 2022. We have decided to manufacture products closer to where the sales are, and that's why Italy will be a very important point of manufacturing and a point of distribution. Of course, there is definitely an inflation on components and an inflation on freight, which we have already captured in our numbers. It's something that we have a little bit anticipated. We didn't think that it will be that much. We didn't think also that it will last so long. We think that the pressure on freight will start going down towards the end of the year. As of today, it's a very intense problem. Russ, you want to add something, please? I think the only thing, just from a financial perspective, so far, although the actions that we've taken with respect to increasing our forecast early in the year have mitigated to a great extent what could have been a significant log jam, if you will, from a supply chain standpoint. Freight costs themselves, this is something that really started to show itself towards the end of the second quarter. It continued to get substantially worse as we moved into the third quarter. We're not expecting it to have any sort of significant material impact on our overall financial results for Q3. We're hoping that we're going to start seeing some of the freight costs rationalize themselves in the fourth quarter. So far, it really has not shown any significant reductions. Maybe I will add an answer to a question that Linda didn't ask, but she could have asked. Are we going to increase the prices going forward? The answer is yes. We have decided to do a price increase on most of our products. Not all, but most of our products will do a price increase starting January 1, in order to mitigate the cost of freight, basically, and also cost of supply. We think that this modest price increase, which we have not done for the last eight years, we have not increased prices for eight years. This modest price increase should be able to cover us in terms of freight. That's it for this question. Linda has another question. Excuse me. Okay. What are the most significant launches planned for 2022? Russ, you know the launches. Well, certainly the most exciting launch that we're looking forward to for 2022 is the launch of Moncler. Moncler for men and Moncler for women. Recently just actually hit Women's Wear Daily just the other day. We will have a soft launch in a very select number of doors coming in the fourth quarter of 2021. The main part of the launch, the global launch, is really earmarked for 2022. It's going to roll out to somewhere between 3,000 and 4,000 doors on a worldwide basis. On the top of Moncler for 2022, we'll have a new blockbuster for Boucheron. We'll have a new fragrance for men for Coach. We'll have an extension of men's for Jimmy Choo. We'll have an extension for Montblanc. We'll have a new fragrance for Guerlain. It's going to be absolutely a busy year. 2022 will be a big year. To finish our comments, based on the issues that there is in the supply chain, and the fact that we cannot deliver all the orders that we have, we anticipate the sell through for Christmas to be stronger because they won't have all the orders that they take. The retailers will not receive all the orders that they take. We anticipate a very strong first quarter 2022, because we'll have to replenish quickly after Christmas. We are gearing up inventory for first quarter 2022. Okay. I think that this conclude this session. The formal part was the formal part. I hope, even if we do not see you, we answered some of the questions that you had. You know that Russ is always available at the office or on his cell phone to answer your questions. Thank you for your time today, and we will see you. We'll talk to most of you soon when we release our first quarter, which will happen beginning of November, I guess. Yes. Okay. Thank you very much and have a good day. Bye-bye. This concludes the meeting. You may now disconnect.