NEW YORK, Dec. 6, 2017 /PRNewswire/ -- Iconix Brand
Group, Inc. (Nasdaq: ICON) ("Iconix" or the "Company") today
reported preliminary financial results for the third quarter ended
September 30, 2017. The Company
expects to complete its impairment testing and file its Form 10-Q
for the quarter ended September 30,
2017 in the near future. The financial information for
the three months ended September 30,
2017, is preliminary and subject to finalization by the
Company and has not been reviewed by our independent registered
public accountants.
Preliminary Third Quarter 2017 Results:
- Licensing Revenue: The Company expects licensing revenue
for the third quarter of 2017 to be approximately $53.2 million, a 12% decline as compared to
$60.5 million in the prior year
quarter. Revenue in the prior year's third quarter included
approximately $2.3 million of
licensing revenue from the Sharper Image brand which was sold in
the fourth quarter of 2016 and approximately $1.3 million of revenue from its Southeast Asia joint venture which was
deconsolidated in the second quarter of 2017. As a result, there
was no comparable revenue for these items in the third quarter of
2017. Excluding Sharper Image and Southeast Asia, revenue declined approximately
7% in the third quarter of 2017.
- SG&A Expenses: The Company continued to manage
expenses and expects SG&A expenses to be approximately
$21.5 million in the third quarter of
2017, a 28% decrease as compared to approximately $29.9 million in the third quarter of 2016.
- Asset Impairment: As previously disclosed, the Company
accelerated the timing of its annual impairment testing of goodwill
and intangible assets that is customarily performed in connection
with the preparation of year-end financial statements and is in the
process of completing such testing in connection with the
preparation of its financial statements for the quarter ended
September 30, 2017. The Company has
not yet finalized its impairment analysis, however, as a result of
such testing which will be completed prior to the filing of the
Company's Form 10-Q for the period ended September 30, 2017, the Company expects to
recognize a non-cash intangible asset impairment charge of
approximately $500 million to
$750 million primarily related to the
women's segment. The Company also expects to have a non-cash tax
charge of approximately $15 million
related to the write off of certain deferred tax assets.
- GAAP Diluted EPS from Continuing Operations: The Company
expects GAAP diluted EPS from continuing operations for the third
quarter of 2017, excluding the impairment charge, to be a loss of
approximately $0.10, as compared to
earnings of $0.25 in the third
quarter of 2016. The earnings of $0.25 in the third quarter of 2016 includes
approximately $0.18 per share related
to a gain on the sale of our equity interest in Complex Media. The
loss of $0.10 in the third quarter of
2017 includes the non-cash tax charge of approximately $15 million or $0.26 per share.
- Non-GAAP Diluted EPS from Continuing Operations: The
Company expects non-GAAP diluted EPS from continuing operations for
the third quarter of 2017 to be approximately $0.24, as compared to $0.18 in the third quarter of 2016. A
reconciliation table for non-GAAP diluted EPS is included at the
end of this press release.
2017 Guidance:
The company believes that, excluding the impact of the
intangible asset impairment charge discussed above, full year 2017
results will be within previously issued guidance.
About Iconix Brand Group, Inc.
Iconix Brand Group, Inc. owns, licenses and markets a portfolio
of consumer brands including: CANDIE'S (R), BONGO (R), JOE BOXER (R), RAMPAGE (R), MUDD (R), MOSSIMO
(R), LONDON FOG (R), OCEAN PACIFIC
(R), DANSKIN (R), ROCAWEAR (R), CANNON (R), ROYAL VELVET (R),
FIELDCREST (R), CHARISMA (R), STARTER (R), WAVERLY (R), ZOO YORK (R), UMBRO (R), LEE COOPER (R), ECKO UNLTD. (R), MARC ECKO (R), and ARTFUL DODGER. In addition,
Iconix owns interests in the MATERIAL GIRL (R), ED HARDY (R), TRUTH OR DARE (R), MODERN
AMUSEMENT (R), BUFFALO (R) and PONY (R) brands. The Company
licenses its brands to a network of leading retailers and
manufacturers that touch every major segment of retail distribution
in both the U.S. and worldwide. Through its in-house business
development, merchandising, advertising and public relations
departments, Iconix manages its brands to drive greater consumer
awareness and equity.
Forward-Looking Statements
In addition to historical information, this press release
contains forward-looking statements within the meaning of the
federal securities laws. Such forward-looking statements include
projections regarding the Company's beliefs and expectations about
future performance and, in some cases, may be identified by words
like "anticipate," "assume," "believe," "continue," "could,"
"estimate," "expect," "intend," "may," "plan," "potential,"
"predict," "project," "future," "will," "seek" and similar terms or
phrases. These statements are based on the Company's beliefs and
assumptions, which in turn are based on information available as of
the date of this press release. Forward-looking statements involve
known and unknown risks and uncertainties, which could cause actual
results to differ materially from those contained in any
forward-looking statement and could harm the Company's business,
prospects, results of operations, liquidity and financial condition
and cause its stock price to decline significantly. Many of these
factors are beyond the Company's ability to control or predict.
Important factors that could cause the Company's actual results to
differ materially from those indicated in the forward-looking
statements include, among others: the ability of the Company's
licensees to maintain their license agreements or to produce and
market products bearing the Company's brand names, the Company's
ability to retain and negotiate favorable licenses, the Company's
ability to meet its outstanding debt obligations and the events and
risks referenced in the sections titled "Risk Factors" in the
Company's Annual Report on Form 10-K for the year ended
December 31, 2016 and subsequent
Quarterly Reports on Form 10-Q and in other documents filed or
furnished with the Securities and Exchange Commission. Our
forward-looking statements do not reflect the potential impact of
any acquisitions, mergers, dispositions, business development
transactions, joint ventures or investments we may enter into or
make in the future. Given these uncertainties, you should not place
undue reliance on these forward-looking statements. These
forward-looking statements are made only as of the date hereof and
the Company undertakes no obligation to update or revise publicly
any forward-looking statements, except as required by law.
Contact Information:
Jaime Sheinheit
VP, Investor Relations
Iconix Brand Group, Inc.
jsheinheit@iconixbrand.com
212.819.2096
Non-GAAP Reconciliation:
The following is a reconciliation of a non-GAAP financial
measures used by the Company to describe the Company's financial
results determined in accordance with United States generally accepted accounting
principles (GAAP).
While management believes that this non-GAAP financial measure
provides useful supplemental information to investors regarding the
underlying performance of the Company's business operations,
investors are reminded to consider this non-GAAP financial measure
in addition to, and not as a substitute for, financial performance
measures prepared in accordance with GAAP. In addition, it should
be noted that this non-GAAP financial measure may be different from
non-GAAP financial measures used by other companies, and management
may utilize other measures to illustrate performance in the future.
Non-GAAP financial measures have limitations in that they do not
reflect all of the amounts associated with the Company's results of
operations as determined in accordance with GAAP.
Non-GAAP Diluted
EPS Reconciliation:
|
|
|
|
|
|
|
Three Months Ended
Sep. 30,
|
|
2017
|
2016
|
|
|
|
GAAP Diluted EPS,
excluding impairment charge
|
($0.10)
|
$0.25
|
|
|
|
Add:
|
|
|
non-cash interest related to ASC 470
|
$0.07
|
$0.07
|
gain on sale of equity interest in Complex Media
|
($0.05)
|
($0.18)
|
loss (gain) on extinguishment of debt
|
$0.03
|
($0.07)
|
loss on termination of licenses
|
$0.05
|
-
|
special charges
|
$0.04
|
$0.05
|
foreign currency translation gain/(loss)
|
($0.02)
|
$0.01
|
accretion for redeemable NCI
|
$0.01
|
-
|
income taxes related to above
|
($0.05)
|
$0.04
|
after tax charge related to write off of certain deferred tax
assets
|
$0.26
|
-
|
Net
|
$0.34
|
($0.07)
|
|
|
|
Non-GAAP
EPS
|
$0.24
|
$0.18
|
View original
content:http://www.prnewswire.com/news-releases/iconix-reports-preliminary-third-quarter-2017-results-and-provides-update-on-intangible-asset-impairment-300567687.html
SOURCE Iconix Brand Group, Inc.