Mossimo, Inc. reported second quarter 2006 total net revenues increased to $10.3 million compared to $9.0 million for the same period last year. The company reported second quarter net earnings of $2.71 million compared to net earnings of $2.2 million for the same period last year, and diluted earnings per share of 17 cents compared to diluted earnings per share of 14 cents for the same period last year.
Net revenues for the six months ended June 30, 2006 were $15.2 million, net of a one-time $6 million rebate to Target (recognized in the first quarter of 2006 as a reduction in revenue), compared to $17.7 million in the same period last year. The company reported net earnings for the first six months of 2006 of $1.5 million compared to net earnings of $4.0 million in the corresponding period a year ago, and diluted earnings per share of $0.10 compared to diluted earnings per share of $0.26 for the same period last year. As noted above, the six month net revenue and earnings numbers reflect the impact of the previously announced changes to the company’s license agreement with Target, which included a one-time $6 million rebate to Target of previously earned royalties, recognized as a reduction in revenue in the first quarter of 2006.
Edwin Lewis, President and Co-Chief Executive Officer stated, “We were pleased with the pace of our business during the quarter, as we registered meaningful gains in our both men’s and women’s business at Target. With regard to Modern Amusement, we experienced better full-price selling compared to a year ago, and while there is still work to be done, we are encouraged by our recent progress.”
The company also announced that it has set a record date of August 15, 2006 for the special meeting of stockholders which will be held to vote on the proposed merger in which Iconix brands, Inc. will acquire the company. The company expects this meeting to be held in September, 2006 but has not yet set the actual meeting date.
MOSSIMO, INC.
CONSOLIDATED STATEMENTS OF EARNINGS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
(Unaudited)
For the Three For the Six
Months Months
June 30, June 30,
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2006 2005 2006 2005
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Revenue from license royalties and
design service fees $9,020 $8,113 $11,581 $15,467
Product sales 1,278 932 3,655 2,242
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Total revenues 10,298 9,045 15,236 17,709
Operating expenses:
Cost of product sales 545 695 1,842 1,734
Selling, general and administrative 5,438 5,353 11,215 9,928
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Total operating expenses 5,983 6,048 13,057 11,662
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Operating earnings 4,315 2,997 2,179 6,047
Interest income 222 79 416 110
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Earnings before income taxes 4,537 3,076 2,595 6,157
Income taxes 1,823 848 1,055 2,108
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Net earnings $2,714 $2,228 $1,540 $4,049
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Net earnings per common share:
Basic $0.17 $0.14 $0.10 $0.26
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Diluted $0.17 $0.14 $0.10 $0.26
