Everlast Worldwide Inc. saw revenues jump for its fourth quarter in both sporting goods sales and licensing revenues. Unfortunately, the company was unable to transfer these gains to the bottom line, posting another quarterly net loss due to divested businesses.
Net revenues for the fourth quarter jumped 34.8% to a record $14.1 million as compared to net revenues of $10.5 million in 2004. The increase was derived from record sporting goods sales of $11 million, a 31% increase over the $8.4 million posted during the same period in 2004, along with a 49% increase in record net licensing revenues to $3.1 million from $2.1 million in Q4 2004. Gross profit jumped 1,340 basis points to 40.1% of sales from 26.7% of sales last year. Nonetheless, the company was unable to bring earnings into the black though it did manage to slim the loss to $433,000, or 13 cents per basic share, for the quarter as compared to a net loss of $1.2 million, or 37 cents per basic share, in 2004. However, when looking at the results of only continuing operations, the company was able to post a profit of $1.7 million compared to a loss of $695,000 in Q4 last year.
The company plans to continue its licensing strategy, hoping to tap into previously unpenetrated and under-penetrated regions like India and China as well as across Europe with licensees in manufacturing, marketing and distributing in the companys core competency categories of apparel, sporting goods, boxing equipment, and footwear.
