Iconix Beats, Raises Guidance - Analyst Blog
April 27 2011 - 2:10PM
Zacks
Iconix Brand Group Inc. (ICON), a brand
management company, delivered first quarter 2011 results.
New York-based Iconix’s earnings soared 25.0% in the quarter to
45 cents a share from 36 cents a share in the year-ago period,
demonstrating steady organic strength across its portfolio of
brands as well as strong margins. Earnings also surpassed the Zacks
Consensus Estimate of 41 cents.
On a reported basis, including one-time items, earnings came in
at 42 cents a share versus 33 cents delivered in the prior-year
quarter.
Iconix raised its fiscal 2011 adjusted earnings forecast to
$1.63 - $1.68 per share from the previous expectation of
$1.53-$1.58 per share. The Zacks Consensus Estimate for fiscal 2011
is $1.54 per share. On a reported basis, the company projects
earnings of $1.50-$1.55 per share, up from previously guided range
of $1.40-$1.45 per share.
Total revenue for the quarter jumped 29.0% to $92.4 million from
$71.7 million in the year-ago period, reflecting double-digit sales
growth in the Direct-to-Retail segment.
Iconix also raised its revenue target to $355.0-$365.0 million
from the earlier guidance range of $340.0-$350.0 million.
On a year-ago basis, EBITDA spiked 19.0% to $58.8 million in the
quarter.
The company exited the year with free cash flow of $45.9
million. Capital expenditures for the quarter were $1.8
million.
For fiscal 2011, the company expects free cash flow in the range
of $167.0 million to $172.0 million (previously $160.0 million to
$165.0 million).
Iconix believes that it is well positioned to maintain its
growth trends with the expansion of brands both in the U.S. and
internationally and as well as acquisition of additional iconic
brands. Recently, the company announced the acquisition of the Ed
Hardy brand from Nervous Tattoo. Through this deal, Iconix will
gain control of the licensing and marketing functions, and increase
its total ownership stake in the Ed Hardy brand to 85%.
Stiff competition from Gap Inc. (GAP),
Cherokee Inc. (CHKE) and The Jones Group
Inc. (JNY) as well as integration risks are concerns.
Currently, ICON has a Zacks #3 Rank, implying a short-term Hold
recommendation.
CHEROKEE INC (CHKE): Free Stock Analysis Report
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