Iconix Brand Group, Inc. saw Q1 licensing revenues more than double to $30.8 million from $13.3 million. EBITDA for the quarter increased to $23.3 million from $8.4 million; net income increased to $12.7 million, or 21 cents a share, from $7.4 million, or 18 cents, a year ago.
On a conference call, Iconix said it bought six brands over the last twelve months, including Rocawear and Danskin during Q1. Management said it expects the two brands on an annualized basis to generate approximately $60 million in royalty revenue and significantly diversify it holdings.
David Conn, Iconix's EVP, said Rocawear has the potential to grow from approximately $700 million in annual sales to over $1 billion in a few years, and the company is in the process of evaluating licensing opportunities for men's outwear, fragrance, and a license agreement in South and Central America. Danskin Now, a diffusion brand of Danskin sold at Wal-Mart, is expected to generate over $10 million in royalties to Iconix in its first 12 months, and Iconix expects more growth opportunities for the brand at Wal-Mart.
Regarding Ocean Pacific, Iconix is actively working on completing the licensing strategy for the brand.
“We believe there's a large and compelling opportunity for OP if it's properly positioned, and we're evaluating both direct-to-retail and wholesale licensing strategies,” said David Conn, Iconix's EVP on the call. “We expect to complete and announce our plans for OP shortly, and it's anticipated that it will launch in the spring of 2008.”
Among its other brands, the strongest Q1 performances came from Candie's, which grew 30% at Kohl's; and Mossimo, which grew 28% at Target. Badgley Mischka's royalty revenues jumped 60%. The Joe Boxer brand is being launched at Sears in August. Iconix's other brands include Bongo, London Fog and Rampage.
