NEW YORK, April 27 /PRNewswire-FirstCall/ -- Iconix Brand
Group, Inc. (Nasdaq: ICON) ("Iconix" or the "Company"), today
announced financial results for the first quarter ended
March 31, 2010.
Q1 2010 results for Iconix Brand Group, Inc:
Total revenue for the first quarter of 2010 was approximately
$71.7 million, a 42% increase as
compared to approximately $50.5
million in the first quarter of 2009. EBITDA attributable to
Iconix for the first quarter was approximately $49.4 million, a 36% increase as compared to
approximately $36.3 million in the
prior year quarter. Free cash flow for the quarter was $40.1 million a 34% increase as compared to
approximately $29.8 million in the
prior year quarter. On a non-GAAP basis, which excludes non-cash
interest related to the Company's convertible debt, net income
attributable to Iconix increased 53% to approximately $27.0 million, as compared to $17.6 million in the prior year quarter and
diluted earnings per share for the first quarter of 2010 was
$0.36 versus $0.29 in the prior year quarter. On a GAAP basis,
net income attributable to Iconix increased 58% to approximately
$24.8 million, as compared to
approximately $15.6 million in the
prior year quarter and diluted earnings per share for the first
quarter of 2010 was $0.33 versus
$0.26 in the prior year quarter.
EBITDA, free cash flow, non-GAAP net income and non-GAAP EPS are
all non-GAAP metrics and reconciliation tables for each are
attached to this press release.
Neil Cole, Chairman and CEO of
Iconix Brand Group, Inc. commented, "We are pleased to report
another record quarter for our Company as we continue to deliver
strong organic growth and profitability for our existing portfolio
of brands. We are having continued success with our
direct-to-retail strategy, where almost across the board we saw
double digit sales increases. Over the past five years we have
built a strong brand management platform with a powerful portfolio
of 24 brands across fashion and home. Today, we are excited to
announce our acquisition of the Peanuts brand which further
diversifies our Company into new categories, channels, and
territories and provides a large global platform from which we hope
to leverage our existing and future brands."
2010 Guidance for Iconix Brand Group, Inc:
The Company is increasing its full year 2010 revenue guidance to
a range of $305-$315 million from
$260-$270 million. This assumes an
organic growth rate of approximately 7% and includes approximately
$35-40 million related to the Peanuts
acquisition. The Company is also raising its 2010 non-GAAP diluted
EPS guidance to a range of $1.35-$1.40 from $1.25-$1.30 and raising its GAAP diluted EPS
guidance to a range of $1.23-1.28
from $1.13-$1.18. The Company now
estimates that free cash flow for 2010 will be in a range of
$150- $155 million. This guidance
relates to the existing portfolio of brands and also includes
contributions related to our acquisition of the Peanuts brand which
we expect to close in the next 30 to 60 days, and assumes no
additional acquisitions.
See reconciliation tables below for non-GAAP metrics. These
non-GAAP metrics may be inconsistent with similar measures
presented by other companies and should only be used in conjunction
with our results reported according to U.S. GAAP. Any
financial measure other than those prepared in accordance with U.S.
GAAP should not be considered a substitute for, or superior to,
measures of financial performance prepared in accordance with U.S.
GAAP.
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) ROCA
WEAR(R), CANNON (R), ROYAL VELVET (R), FIELDCREST (R), CHARISMA
(R), STARTER (R) and WAVERLY (R).
In addition, Iconix owns an interest in the ARTFUL DODGER (R),
ED HARDY (R), ECKO (R), MARC ECKO (R), ZOO YORK (R) and MATERIAL GIRL™
brands. The Company licenses its 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", "will",
"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. All forward-looking
statements are qualified by these cautionary statements and apply
only as of the date they are made. The Company undertakes no
obligation to update any forward-looking statement, whether as a
result of new information, future events or otherwise.
Contact
Information:
|
|
Jaime
Sheinheit
|
|
Investor
Relations
|
|
Iconix
Brand Group
|
|
212.730.0030
|
|
|
Condensed Consolidated Income
Statements
(in thousands, except earnings
per share data)
|
|
|
(Unaudited)
|
|
|
Three Months Ended
March 31,
|
|
|
2010
|
2009
|
|
|
|
|
|
|
|
|
|
|
|
|
Licensing and other revenue
|
$
71,704
|
$50,501
|
|
|
|
|
|
|
|
Selling, general and administrative
expenses
|
22,318
|
16,270
|
|
|
Expenses related to specific
litigation
|
6
|
54
|
|
|
|
|
|
|
|
Operating income
|
49,380
|
34,177
|
|
|
|
|
|
|
|
Interest expense
and other, net
|
9,975
|
9,835
|
|
|
|
|
|
|
|
Equity (gain) loss
on joint venture, net
|
(1,113)
|
(37)
|
|
|
|
|
|
|
|
Other expenses –
net
|
8,862
|
9,798
|
|
|
|
|
|
|
|
Income before income taxes
|
40,518
|
24,379
|
|
|
|
|
|
|
|
Provision for income taxes
|
14,064
|
8,730
|
|
|
|
|
|
|
|
Net income
|
$
26,454
|
$
15,649
|
|
|
|
|
|
|
|
Net income attributable to
non-controlling interest,
net of tax
|
1,680
|
-
|
|
|
|
|
|
|
|
Net income attributable to Iconix
Brand Group, Inc.
|
$24,774
|
$
15,649
|
|
|
|
|
|
|
|
Earnings per share:
|
|
|
|
|
Basic
|
$
0.35
|
$
0.27
|
|
|
|
|
|
|
|
Diluted
|
$
0.33
|
$
0.26
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of common
shares outstanding:
|
|
|
|
|
Basic
|
71,537
|
58,044
|
|
|
|
|
|
|
|
Diluted
|
74,426
|
60,892
|
|
|
|
|
|
|
|
|
|
|
Selected Balance Sheet
Items:
(in thousands)
|
(Unaudited)
3/31/2010
|
12/31/2009
|
|
|
|
|
|
Total Assets
|
$1,812,915
|
$1,802,613
|
|
Total Liabilities
|
$808,842
|
$832,841
|
|
Total Stockholders' Equity
|
$1,004,073
|
$969,772
|
|
|
|
|
|
|
The following three tables detail unaudited reconciliations from
non-GAAP amounts to U.S. GAAP relating to the adoption of ASC Topic
470 as it relates to accounting for convertible debt, which
became effective retroactively for the fiscal years beginning after
December 15, 2008.
Note: All items in the following reconciliation tables are
attributable to Iconix Brand Group, Inc. and exclude results
related to non-controlling interests.
(in thousands, except per share
data)
|
|
|
(Unaudited)
|
|
|
Three months
ended
|
|
Net income
reconciliation
|
March
31,
2010
|
March
31,
2009
|
|
Non-GAAP Net Income (1)
|
$26,959
|
$17,588
|
|
|
|
|
|
GAAP Net income
|
24,774
|
15,649
|
|
|
|
|
|
Add: Non-cash interest related to ASC
Topic 470
|
3,347
|
3,017
|
|
Deduct: Income taxes related to
non-cash interest
|
1,162
|
1,078
|
|
Net
|
2,185
|
1,939
|
|
|
|
|
|
Non-GAAP Net Income
|
$26,959
|
$17,588
|
|
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
Three months
ended
|
|
Diluted EPS
reconciliation
|
March
31,
2010
|
March
31,
2009
|
|
Non-GAAP Diluted EPS
(1)
|
$0.36
|
$0.29
|
|
|
|
|
|
GAAP Diluted EPS
|
$0.33
|
$0.26
|
|
|
|
|
|
Add: Non-cash interest related
to ASC Topic 470, net of
tax
|
$0.03
|
$0.03
|
|
|
|
|
|
Non-GAAP Diluted EPS
|
$0.36
|
$0.29
|
|
|
|
|
|
|
|
|
Forecasted Diluted EPS
|
Year
Ending
12/31/10
|
|
Year
Ended
12/31/09
|
|
|
High
|
Low
|
|
Actual
|
|
|
|
|
|
|
|
Non-GAAP Diluted EPS
(1)
|
$1.40
|
$1.35
|
|
$1.22
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Diluted EPS
|
$1.28
|
$1.23
|
|
$1.10
|
|
|
|
|
|
|
|
Add: Non-cash interest related
to ASC Topic 470, net of
tax
|
$0.12
|
$0.12
|
|
$0.12
|
|
Non-GAAP Diluted EPS
|
$1.40
|
$1.35
|
|
$1.22
|
|
|
|
(1) Non-GAAP Net Income and EPS, are
non-GAAP financial measures, which represent net income excluding
any non-cash interest, net of tax, relating to the adoption of ASC
Topic 470. The Company believes these are useful financial
measures in evaluating its financial condition because it is
representative of only actual cash interest paid on outstanding
debt.
|
|
|
|
|
|
|
(in
thousands)
|
|
|
(Unaudited)
|
|
|
Three months
ended
|
|
|
March
31,
2010
|
March
31,
2009
|
|
EBITDA (1)
|
$49,447
|
$36,337
|
|
|
|
|
|
Reconciliation of EBITDA:
|
|
|
|
Net Income
|
24,774
|
15,649
|
|
|
|
|
|
Add: Income taxes
|
13,159
|
8,730
|
|
|
|
|
|
Add: Net interest expense
|
9,245
|
9,835
|
|
|
|
|
|
Add: Depreciation and
amortization of certain intangibles
|
2,269
|
2,123
|
|
EBITDA
|
$49,447
|
$36,337
|
|
|
|
(1) EBITDA, a non-GAAP financial
measure, represents income from operations before income taxes,
interest, 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.
|
|
|
|
|
|
(Unaudited)
Three months
ended
|
|
|
March 31,
2010
|
March 31,
2009
|
|
Free Cash Flow (2)
|
$40,060
|
$29,846
|
|
|
|
|
|
Reconciliation of Free Cash
Flow:
|
|
|
|
Net Income
|
24,774
|
15,649
|
|
|
Add: Non-cash income taxes, non-cash
interest related ASC Topic 470, depreciation, amortization of
certain intangible assets and finance fees, non-cash compensation
expense, bad debt expense and net non cash equity earnings from
certain joint ventures
|
15,310
|
14,208
|
|
Less: Capital
expenditures
|
(24)
|
(11)
|
|
|
|
|
|
Free Cash Flow
|
$40,060
|
$29,846
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands)
|
Year
Ending
Dec
31, 2010
|
|
|
High
|
Low
|
|
Forecasted Free Cash Flow
(2)
|
$155,000
|
$150,000
|
|
|
|
|
|
Reconciliation of Free Cash
Flow:
|
|
|
|
Net Income
|
$95,000
|
$90,000
|
|
Add: Non-cash income taxes, non-cash
interest
related to ASC Topic
470, depreciation,
amortization
of certain intangible assets and
finance fees, non-cash
compensation expense, bad debt expense
and net
equity earnings from certain joint
ventures
|
63,000
|
63,000
|
|
Less: Capital
expenditures
|
(3,000)
|
(3,000)
|
|
|
|
|
|
Forecasted Free Cash Flow
|
$155,000
|
$150,000
|
|
|
|
|
(2) Free Cash Flow, a non-GAAP
financial measure, represents net income before depreciation,
amortization, non-cash compensation expense, bad debt expense, net
non cash equity earnings from joint ventures, non-cash income
taxes, non-cash interest related to ASC Topic 470, and less capital
expenditures. The Free Cash Flow also excludes any changes in
Balance Sheet items. The Company believes Free Cash Flow is useful
in evaluating its financial condition because it is representative
of cash flow from operations that is available for repaying debt,
investing and capital expenditures
|
|
|
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|
SOURCE Iconix Brand Group, Inc.