* Q2 Licensing Revenue of $39.1 million compared to $18.4 in prior year
quarter
* EBITDA of $31.2 million compared to $11.4 million in prior year quarter
* Net Income of $14.8 million versus $5.2 million (tax-effected) in prior
year quarter
* Q2 fully diluted EPS of $0.24 versus $0.12 (tax-effected) in prior year
quarter
NEW YORK, Aug. 7 /PRNewswire-FirstCall/ -- Iconix Brand Group, Inc.
(Nasdaq: ICON) ("Iconix" or the "Company") today announced financial results
for the second quarter and six months ended June 30, 2007.
Q2 2007 results:
Licensing revenue for the second quarter of 2007 increased to
approximately $39.1 million, as compared to approximately $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 $0.24 versus $0.19. 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 $0.24 for 2007
versus $0.12 (tax-effected) in 2006. EBITDA, free cash flow and tax effected
EPS are non-GAAP measures and reconciliation tables for all three are attached
to this press release. These non-GAAP measures should not be considered in
isolation or as an alternative to GAAP measures of performance.
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 $0.45 versus $0.37 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 $0.45 in the first six months of
2007 as compared to $0.21 (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-$160 million and fully diluted earnings per share in a
range of $0.96-$1.00.
Iconix Brand Group Inc. (Nasdaq: ICON) owns, licenses and markets a
growing portfolio of consumer brands including CANDIE'S (R), BONGO (R),
BADGLEY MISCHKA (R), JOE BOXER (R) RAMPAGE (R) MUDD (R), LONDON FOG (R),
MOSSIMO (R) OCEAN PACIFIC (R), DANSKIN (R) and ROCA WEAR(R). The Company
licenses it brands to a network of leading retailers and manufacturers that
touch every major segment of retail distribution from the luxury market to the
mass market in both the U.S. and around the world. Iconix, through its in-
house advertising, promotion and public relations agency, markets its brands
to continually drive greater consumer awareness and equity.
Safe Harbor Statement under the Private Securities Litigation Reform Act
of 1995. The statements that are not historical facts contained in this press
release are forward looking statements that involve a number of known and
unknown risks, uncertainties and other factors, all of which are difficult or
impossible to predict and many of which are beyond the control of the Company,
which may cause the actual results, performance or achievements of the Company
to be materially different from any future results, performance or
achievements expressed or implied by such forward looking statements. Such
factors include, but are not limited to, uncertainty regarding the results of
the Company's acquisition of additional licenses, continued market acceptance
of current products and the ability to successfully develop and market new
products particularly in light of rapidly changing fashion trends, the impact
of supply and manufacturing constraints or difficulties relating to the
Company's licensees' dependence on foreign manufacturers and suppliers,
uncertainties relating to customer plans and commitments, the ability of
licensees to successfully market and sell branded products, competition,
uncertainties relating to economic conditions in the markets in which the
Company operates, the ability to hire and retain key personnel, the ability to
obtain capital if required, the risks of litigation and regulatory
proceedings, the risks of uncertainty of trademark protection, the uncertainty
of marketing and licensing acquired trademarks and other risks detailed in the
Company's SEC filings. The words "believe", "anticipate," "expect",
"confident", "project", provide "guidance" and similar expressions identify
forward-looking statements. Readers are cautioned not to place undue reliance
on these forward looking statements, which speak only as of the date the
statement was made.
Contact: David Conn
Executive Vice President
Iconix Brand Group
212.730.0030
Joseph Teklits
Integrated Corporate Relations
203.682.8200
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
=========================== =========================
Earnings per share:
Basic $ 0.26 $ 0.22 $ 0.49 $ 0.42
=========================== =========================
Diluted $ 0.24 $ 0.19 $ 0.45 $ 0.37
=========================== =========================
Weighted average
number of common
shares outstanding:
Basic 56,625 38,680 56,451 37,208
=========================== =========================
Diluted 61,364 44,712 61,241 42,872
=========================== =========================
Selected Balance Sheet Items: 6/30/2007 12/31/2006
(in thousands) (Unaudited) (Audited)
Total Assets $1,218,126 $701,052
Total Liabilities $729,120 $235,595
Stockholders' Equity $489,006 $465,457
The following table details unaudited reconciliations from non-GAAP
amounts to U.S. GAAP and effects of these items:
(in thousands)
Three Months Ended Six Months Ended
-------------------- ------------------
June 30, June 30 June 30, June 30
2007 2006 2007 2006
-------- ------- -------- --------
EBITDA (1) $ 31,249 $ 11,434 $ 54,554 $ 19,826
======== ======== ======== ========
Reconciliation of EBITDA:
Operating income 29,729 10,880 52,088 18,909
Add: Depreciation and
amortization of certain
intangibles 1,520 554 2,466 917
-------- -------- -------- --------
EBITDA $ 31,249 $ 11,434 $ 54,554 $ 19,826
(1) EBITDA, a non-GAAP financial measure, represents income from
operations before interest, income taxes, depreciation and amortization
expenses. The Company believes EBITDA provides additional information for
determining its ability to meet future debt service requirements,
investing and capital expenditures.
Free Cash Flow (2) $ 25,790 $ 9,305 $ 47,432 $ 15,439
======== ======== ======== ========
Reconciliation of
Free Cash Flow:
Net income $ 14,789 $ 8,345 $ 27,536 $ 15,702
Add: Depreciation,
amortization of
intangibles and
deferred financing
costs, the change in
the reserve for accounts
receivable, and non-cash
compensation expense 2,974 1,389 4,919 1,914
Add: Non-cash income
taxes (benefits) 8,027 (347) 15,017 (1,619)
Less: Capital expenditures 0 82 40 558
-------- -------- -------- --------
Free Cash Flow $ 25,790 $ 9,305 $ 47,432 $ 15,439
======== ======== ======== ========
(2) Free Cash Flow, a non-GAAP financial measure, represents net income
before depreciation, amortization, the change in the reserve for accounts
receivable and excluding non-cash income taxes (benefits) and capital
expenditures. The Company believes Free Cash Flow is useful for evaluating
our financial condition because it represents the amount of cash generated
from the operations that is available for repaying debt and investing.
Reconciliation of net income to tax- effected net income and reconciliation of
diluted net income per share to tax-effected diluted net income per share.
Three Months Ended Six Months Ended
Reconciliation to GAAP: June 30, 2006 June 30, 2006
(in thousands except per share data)
Net income, GAAP, as reported $ 8,345 $ 15,702
Less: GAAP income tax benefit (347) (1,619)
-------- ---------
Income before income taxes, as reported 7,998 14,083
Less: 35% effective tax provision (2,799) (4,929)
-------- ---------
Net income, as adjusted with 35% tax rate $ 5,199 $ 9,154
Number of dilutive shares 44,712 42,872
Dilutive EPS, as adjusted with 35%
Effective tax rate $ 0.12 $ 0.21
The Company believes that tax-effected net income and tax-effected net
income per diluted share are important metrics used by management to evaluate
and under stand the performance of the ongoing operations of the Company's
business.
SOURCE Iconix Brand Group Inc.
-0- 08/07/2007
/CONTACT: David Conn, Executive Vice President of Iconix Brand Group, +1-
212-730-0030; or Joseph Teklits of Integrated Corporate Relations, +1-203-682-
8200, for Iconix Brand Group/
/Web site: http://iconixbrand.com/ /
(ICON)
CO: Iconix Brand Group Inc.
ST: New York
IN: ADV
SU: ERN
MD-MC
-- NYTU067 --
2134 08/07/2007 08:00 EDT http://www.prnewswire.com