- Kenneth Cole Productions, Inc. Announces First Quarter Results -
May 01 2007 - 5:00PM
PR Newswire (US)
- Operating Income Increases 18.7% to $4.3 million Versus Year-ago
$3.7 Million - NEW YORK, May 1 /PRNewswire-FirstCall/ -- Kenneth
Cole Productions, Inc. (NYSE:KCP) today reported financial results
for the first quarter ended March 31, 2007. The Company's first
quarter net revenues were $129.3 million, an increase of 5.5%
versus the year ago level of $122.6 million. Operating income in
the quarter increased by 18.7% to $4.3 million versus $3.7 million
in last year's first quarter. First quarter earnings per
fully-diluted share were $0.17 versus the year-ago first quarter
earnings of $0.15 per share. First quarter wholesale revenues were
$82.9 million, up 9.3% versus the prior year's level of $75.9
million. The year-ago period was negatively affected, as the
Company has previously noted, by approximately $7 million of
delayed shipments, due to the start-up of a new distribution
facility. Consumer direct revenues for the first quarter increased
1.6% to $36.9 million versus $36.3 million in the same quarter last
year, with a comparable store sales decline of 1.5% versus the
year-ago quarter. Licensing revenue for the first quarter decreased
by 8.7% to $9.5 million versus $10.4 million in the same quarter of
the prior year due to a previously announced change in the men's
sportswear license. Gross margin for the first quarter was 40.6%,
versus the year-ago level of 41.9%, due to slightly lower wholesale
margins as well as the shift in mix toward wholesale. SG&A
expense as a percent of sales for the first quarter was 37.3% of
sales versus 38.9% in the year-ago quarter. The Company's
consolidated inventories decreased 13.0% to $46.7 million on March
31, 2006 versus the year-ago level of $53.7 million, in part
reflecting the wholesale shipping timing issue from the year-ago
period. Consumer direct inventories decreased 13.8% to $21.9
million from $25.4 million in the prior year, while wholesale
inventories decreased 12.3% to $24.8 million from $28.3 million
last year. The Company is comfortable with the level and content of
its inventories. The Company also announced today that it will
assume control of its men's collection sportswear business and
plans to commence shipments beginning with the Spring 2008 season.
The collection will be marketed under the Kenneth Cole New York
brand and will incorporate a wider range of price points than
previously available under that label. This effort is expected to
require approximately $7 million of normal operating costs, which
are incremental in fiscal 2007, during which the Company expects to
record few, if any, revenues associated with the business. Chairman
and Chief Executive Officer Kenneth Cole said, "We are enthusiastic
about men's collection sportswear. This is a unique opportunity to
take control of an existing, developed, yet under-penetrated
business with significant growth opportunities. It is also an
opportunity to further enhance and evolve a classification of
product paramount to the overall stature of each of our brands."
Mr. Cole continued, "We are confident that our new collection will
excite both retailers and consumers. The launch will coincide with
our company's 25th Anniversary, which will be promoted with the
largest marketing campaign in our company's history. At the same
time, we are pleased by the ongoing performance and acceptance of
the Reaction brand. We are confident that Reaction, which continues
to represent the largest portion of our business at retail, will
benefit from this initiative." Also today, the Company issued
financial guidance for the second fiscal quarter; the Company
expects to report net revenues of approximately $120 million and
earnings per fully diluted share in the range of $0.14 to $0.16.
The Company announced today that its board of directors had
authorized its quarterly dividend of $0.18 per share. The dividend
is payable on June 14, 2007 to shareholders of record as of May 24,
2007. About Kenneth Cole Productions, Inc. Kenneth Cole
Productions, Inc. designs, sources, and markets a broad range of
footwear, handbags, and accessories under the registered trademarks
KENNETH COLE NEW YORK, KENNETH COLE REACTION, UNLISTED and TRIBECA
as well as footwear under the proprietary trademark GENTLE SOULS
and under the licensed trademark BONGO. The company has also
granted a wide variety of third party licenses for the production
of men's, women's and children's apparel, as well as fragrances,
timepieces, eyewear, housewares, and several other accessory
categories. The company's products are distributed through
department stores, better specialty stores, and company-owned
retail stores as well as direct to consumer catalogs and
e-commerce. Further information can be found at
http://www.kennethcole.com/. Forward Looking Statement Disclosure
The statements contained in this release, which are not historical
facts, may be deemed to constitute "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act
of 1995. Actual future results might differ materially from those
projected in such statements due to a number of risks and
uncertainties, including but not limited to, demand and competition
for the company's products, the ability to enter into new product
license agreements or to renew or replace existing product licensee
agreements, changes in consumer preferences or fashion trends,
delays in anticipated store openings, and changes in the Company's
relationships with retailers, licensees, vendors and other
resources. The forward looking statements contained herein are also
subject to other risks and uncertainties that are described in the
Company's reports and registration statements filed with the
Securities and Exchange Commission. Kenneth Cole Productions, Inc.
(In thousands, except Quarter Ended share amounts) (Unaudited)
3/31/07 3/31/06 Net sales $119,868 $112,201 Licensing and other
revenue 9,470 10,374 __________ __________ Net revenue $129,338
$122,575 ========== ========== Gross profit 52,554 51,297 Selling,
gen'l & administrative 48,221 47,647 __________ __________
Operating income 4,333 3,650 Interest income 1,261 1,252 __________
__________ Income before taxes 5,594 4,902 Income tax expense 2,154
1,838 __________ __________ Net income $3,440 $3,064 ==========
========== Net income per share: Basic $.17 $.15 ==========
========== Net income per share: Diluted $.17 $.15 ==========
========== Average shares outstanding: Basic 20,079,000 20,109,000
Average shares outstanding: Diluted 20,393,000 20,422,000 Balance
Sheet Data: 3/31/07 3/31/06 __________________ _______ ________
Cash & Marketable Securities $104,992 $114,942 Due from
Factor/Accounts Receivable 65,635 59,618 Inventory 46,736 53,715
Total Assets 363,354 345,952 Working Capital 175,030 186,795
Accounts Payable 29,723 33,387 Long-term Debt 0 0 Total
Shareholders' Equity 262,167 247,150 DATASOURCE: Kenneth Cole
Productions, Inc. CONTACT: David Edelman, Chief Financial Officer
of Kenneth Cole Productions, Inc., +1-212-265-1500; or, investor
relations, James R. Palczynski, Principal of Integrated Corporate
Relations, Inc., for Kenneth Cole Productions, Inc. +1-203-682-8229
Web site: http://www.kennethcole.com/
Copyright
Kenneth Cole Prod In (NYSE:KCP)
Historical Stock Chart
From Jun 2024 to Jul 2024
Kenneth Cole Prod In (NYSE:KCP)
Historical Stock Chart
From Jul 2023 to Jul 2024