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Movado Strange Case of Double Negative

Movado Luno

Image by NVinacco via Flickr

Movado (MOV) released Q3 numbers along with the usual executive nattering about how well they are doing.

Efraim Grinberg, Chairman and Chief Executive Officer, stated, “We have begun executing our multi-year strategic plan and gained traction in our initiatives during the third quarter.”  

Rick Cote, President and Chief Operating Officer, stated, “We are pleased with our results in the third quarter and year-to-date periods.”

But they also report  “On a GAAP basis, income from continuing operations in the third quarter of fiscal 2011 was $16.9 million, or $0.68 per diluted share, which included a liability reversal of $4.3 million, or $0.17 per diluted share, related to a previously recorded liability for a retirement agreement with the Company’s former Chairman. ” 

Liability reversal? They did not allude to any previously reported news. They just threw in the little tidbit and expect investors to suck it up and carry on. At $0.17 per diluted share management could have explained a little bit more. Avoiding the discussion just makes investors suspicious. Transparency is not well served.

Disclosure: George Gutowski writes from a caveat emptor perspective. I hold no positions in stocks mentioned in this post.