Iconix Q3 Revenue Increases 29%

Iconix Brand Group, Inc. saw revenue for the third quarter ended Sept. 30, 2008 increase 29% to approximately $55.1 million, as compared to approximately $42.7 million in the third quarter of 2007. Net income for the third quarter increased 8% to approximately $18.3 million, as compared to $17.0 million in the prior year quarter.


With Iconix’s earnings report came the announcement that its board of directors authorized a program to repurchase up to $75 million of stock over the next three years. “We feel at certain price levels buying back our shares would create great value for shareholders,” commented CFO Warren Clamen.


As for the company’s sports-related brands, CEO Neil Cole stated that the company plans to increase marketing in 2009. “We felt this is a time not to pull back and we are going to be doing some pretty interesting and exciting marketing on especially the Wal-Mart brands. You're going to see a big new initiative on Starter, Danskin, and OP.”


The company expects to achieve its 2008 guidance for revenue of $215 million to $220 million and diluted earnings per share of $1.15 to $1.20, but is now guiding towards the low-end of the ranges.


Cole also discussed the company’s expansion overseas. “We remain excited about our China joint venture with Novel Fashions, which is run by Silas Chou. We believe there is a big opportunity to take our brands worldwide… We anticipate having two equity deals in China signed by the end of this year and plan to have a total of four to five brands signed by the end of '09… Today I think we have about 15 licensees in Central and South America.”


The company also released its 2009 guidance, expecting revenue to increase approximately 7% to a range of $225 million to $235 million.

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Iconix Q3 Revenue Increases 29%

Iconix Brand Group, Inc. saw revenue for the third quarter ended Sept. 30, 2008 increase 29% to approximately $55.1 million, as compared to approximately $42.7 million in the third quarter of 2007. Net income for the third quarter increased 8% to approximately $18.3 million, as compared to $17.0 million in the prior year quarter.

With Iconix’s earnings report came the announcement that its Board of Directors have authorized a program to repurchase up to $75 million of stock over the next three years. “We feel at certain price levels buying back our shares would create great value for shareholders,” commented CFO Warren Clamen.

As for the company’s sports-related brands, CEO Neil Cole stated that the company plans to increase marketing in 2009. “We felt this is a time not to pull back and we are going to be doing some pretty interesting and exciting marketing on especially the Wal-Mart brands. You're going to see a big new initiative on Starter, Danskin, and OP.”

The company expects to achieve its 2008 guidance for revenue of $215 million to $220 million and diluted earnings per share of $1.15 to $1.20, but is now guiding towards the low-end of the ranges.

Cole also discussed the company’s expansion overseas. “We remain excited about our China joint venture with Novel Fashions, which is run by Silas Chou. We believe there is a big opportunity to take our brands worldwide… We anticipate having two equity deals in China signed by the end of this year and plan to have a total of four to five brands signed by the end of '09… Today I think we have about 15 licensees in Central and South America.”

The company also released its 2009 guidance, expecting revenue to increase approximately 7% to a range of $225 million to $235 million.

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Iconix Q3 Revenue Increases 29%

Iconix Brand Group, Inc. saw revenue for the third quarter ended Sept. 30, 2008 increase 29% to approximately $55.1 million, as compared to approximately $42.7 million in the third quarter of 2007. EBITDA for the third quarter increased 23% to approximately $37.9 million as compared to approximately $30.8 million in the prior year quarter, and free cash flow for the quarter increased 13% to approximately $31.5 million as compared to approximately $27.9 million in the prior year quarter. Net income for the third quarter increased 8% to approximately $18.3 million, as compared to $17.0 million in the prior year quarter and GAAP diluted earnings per share increased to 30 cents versus 28 cents in the prior year quarter.

Revenue for the nine months ended Sept. 30, 2008 increased 44% to approximately $162.5 million as compared to approximately $112.6 million in the prior year nine month period. EBITDA for the nine month period increased 31% to approximately $111.8 million as compared to approximately $85.4 million in the prior year period, and free cash flow increased 22% to approximately $91.0 million as compared to approximately $74.8 million in the prior year period. Net income for the nine month period increased 19% to approximately $53.0 million as compared to approximately $44.5 million in the prior year period and GAAP diluted earnings per share increased to $0.87 versus $0.73 in the prior year period.

Neil Cole, chairman and CEO of Iconix Brand Group, Inc. commented, “Our strong performance in the third quarter demonstrates, more than ever, that our business model is extremely well suited to thrive in the current economic environment. Having a diversified portfolio of 17 iconic brands and partnerships with best in class retailers enables us to continue to deliver great results. In issuing 2009 guidance today, we are confident in our ability to grow sales and earnings next year and we are energized about our organic growth plans.”

The company expects to achieve its 2008 guidance for revenue of $215-220 million and diluted earnings per share of $1.15-$1.20, but is now guiding towards the low-end of the ranges. Free cash flow is projected to be in excess of $120 million.

The company is issuing guidance for the full year 2009 of revenue in a range of $225-$235 million. The company estimates non-GAAP diluted earnings per share to be in a range of $1.20-$1.30, excluding any non-cash interest related to the convertible debt. Free cash flow is estimated to be in a range of $114-$118 million. This guidance relates to the existing portfolio of brands only and includes no revenue assumption from acquisitions.

Beginning in 2009, GAAP will require the company to record incremental non-cash interest related to our convertible debt for 2009 and 2008 for comparability purposes. The company expects the impact of this change in accounting policy to be 14 cents for 2009 and 13 cents for 2008.

   Iconix Brand Group, Inc. and Subsidiaries

Condensed Consolidated Income Statements – (Unaudited)
(in thousands, except earnings per share data)

Three Months Ended Sept. 30, Nine Months Ended Sept. 30,
————————— —————————
2008 2007 2008 2007
————————— —————————


Licensing and other
revenue $55,135 $42,681 $162,502 $112,593

Selling, general and
Administrative
expenses 18,558 13,400 55,589 30,130
Expenses related to
specific litigation 279 (39) 665 1,055
————————— —————————

Operating income 36,298 29,320 106,248 81,408

Other expenses –
net 8,007 4,719 24,178 14,254
————————— —————————

Income before income
taxes 28,291 24,601 82,070 67,154
————————— —————————

Provision for income
taxes 9,974 7,608 29,053 22,625
————————— —————————

Net income $18,317 $16,993 $53,017 $44,529
=========================== ===========================



Earnings per share:
Basic $0.32 $0.30 $0.92 $0.79
=========================== ===========================


Diluted $0.30 $0.28 $0.87 $0.73
=========================== ===========================


Weighted average number
of common shares
outstanding:
Basic 57,841 56,801 57,662 56,569
=========================== ===========================

Diluted 61,091 61,380 61,241 61,289
=========================== ===========================



Selected Balance Sheet Items: 9/30/2008 12/31/2007
(Unaudited) (Audited)
Total Assets $1,384,778 $1,336,130
Total Liabilities $787,336 $808,210
Stockholders Equity $597,442 $527,920


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