Iconix Brand Group, Inc. second quarter licensing revenue increased 113% to approximately $39.1 million from $18.4 million in the second quarter of 2006. EBITDA for the second quarter increased to approximately $31.2 million as compared to approximately $11.4 million in the prior year quarter and free cash flow for the quarter increased to approximately $25.8 million as compared to approximately $9.3 million in the prior year quarter. Net income for the second quarter as reported on the company's income statement was approximately $14.8 million versus approximately $8.3 million in 2006, and fully diluted earnings per share as reported on the company's income statement, was 24 cents versus 19 cents. The company recognized non-cash tax benefits in the prior year quarter and therefore comparing net income on a tax-effected basis the company reported net income of $14.8 million versus approximately $5.2 million (tax-effected) in 2006 and fully diluted earnings per share was approximately 24 cents for 2007 versus 12 cents (tax-effected) in 2006.


Six months ended June 30, 2007 results


Licensing revenue for the six months ended June 30, 2007 increased to approximately $69.9 million as compared to approximately $31.7 million in the prior year six month period. EBITDA for the six month period increased to approximately $54.6 million as compared to approximately $19.8 million in the prior year, and free cash flow increased to approximately $47.4 million as compared to approximately $15.4 million in the prior year. Net income as reported on the company's income statement for the six month period increased to approximately $27.5 million as compared to approximately $15.7 million in the prior year and fully diluted earnings per share as reported on the company's income statement were 45 cents versus 37 cents in the prior year. The company recognized non-cash tax benefits in the prior year six month period and therefore comparing net income on a tax-effected basis the company reported net income of approximately $27.5 million as compared to approximately $9.2 million (tax-effected) in the prior year six months. In comparing fully diluted earnings per share on a tax-effected basis the company reported fully diluted earnings per share of 45 cents in the first six months of 2007 as compared to 21 cents (tax-effected) in the prior year six month period.


Neil Cole, chairman and CEO of Iconix, commented, “I am pleased with our financial results this quarter as we more than doubled our revenue from a year ago and at the same time increased our EBITDA margins year over year. These metrics continue to underscore the compelling growth and profitability of our unique business model and strategy. Our portfolio performed well in the quarter and we were able to successfully integrate our two recent acquisitions, Danskin and Roca Wear and I am very excited about the earnings power both of these brands will bring to our portfolio. In light of the current conditions in the debt and equity markets we feel the approximately $250 million that we raised in the quarter through our convertible bond offering was opportune and has positioned us well to continue to execute our growth strategy and has also materially lowered our overall cost of capital.”


2007 Guidance


The company is re-affirming its previously stated 2007 guidance of revenue in a range of $150 million to $160 million and fully diluted earnings per share in a range of 96 cents to $1.00.


 

             Iconix Brand Group, Inc. and Subsidiaries


            Condensed Consolidated Income Statements – (Unaudited)

                (in thousands, except earnings per share data)


                        Three Months Ended June 30,  Six Months Ended June 30,

                            2007          2006           2007        2006

                        —————————  ————————-


    Licensing and

     commission revenue  $ 39,071       $18,409       $ 69,912     $ 31,678


    Selling, general

     and administrative

     expenses               9,011         6,817         16,730       11,501

    Special charges           331           712          1,094        1,268

                        —————————  ————————-


    Operating income       29,729        10,880         52,088       18,909


    Other expenses:

      Interest expense

       – net                6,913         2,882          9,535        4,826

                        —————————  ————————-


    Income before

     income taxes          22,816         7,998         42,553       14,083

                        —————————  ————————-


    Provision/(benefit)

     for Income taxes       8,027          (347)        15,017       (1,619)

                        —————————  ————————-


    Net income           $ 14,789       $ 8,345       $ 27,536     $ 15,702

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    Earnings per share:

        Basic              $ 0.26        $ 0.22         $ 0.49       $ 0.42

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        Diluted            $ 0.24        $ 0.19         $ 0.45       $ 0.37

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