Iconix 4Q net income falls, but beats predictions
NEW YORK (AP) — Iconix Brand Group Inc. said Wednesday its fourth-quarter net income fell 4 percent, hurt by a drop in licensing revenue.
But the clothing brand licensing company's adjusted profit was better than Wall Street expected. It also boosted its 2013 guidance, announced a new stock repurchase program and an acquisition. The news sent shares up in premarket trading.
Iconix posted earnings of $26.1 million, or 37 cents per share, in the three months ended Dec. 31. That was down from $27.2 million, or 36 cents per share, in the same quarter last year.
The recent quarter's results were based on 7 percent fewer outstanding shares than the 2011 period, which has the effect of boosting earnings per share.
Excluding one-time items, Iconix said its adjusted profit was 41 cents per share for the recent quarter.
Licensing and other revenue fell 11 percent to $85.1 million, from $95.5 million.
Analysts, on average, expected a profit of 38 cents per share, on $81.8 million in revenue, according to FactSet.
For the full year 2012, Iconix earned $109.4 million, or $1.52 per share, down from $126.1 million, or $1.67 per share, in 2011. Revenue fell 4 percent to $353.8 million from $369.8 million.
The company also said Wednesday that it acquired the Lee Cooper brand for $72 million in cash.
Founded in 1908, Lee Cooper began as a British denim brand and has since expanded into men's and women's casual wear, footwear and accessories, Iconix said.
Lee Cooper currently operates as a pure licensing business with 35 international licensees that are expected to generate about $14 million in annual royalty revenue this year. The brand is sold in over 80 countries and represents about $500 million in annual global retail sales, Iconix said.
As a result of the acquisition, Iconix boosted its 2013 adjusted profit guidance by 5 cents to a range of $2.05 to $2.15 per share. It also raised its revenue estimate by $10 million to a range of $425 million to $435 million.
Analysts were expecting a 2013 profit of $2.05 per share on $416.4 million in revenue.
The company also said Wednesday that its board approved a new stock buyback program allowing the repurchase up to $300 million of its shares over a three-year period. It replaces the existing $200 million program, which Iconix said it expects to soon complete.
Iconix shares rose 70 cents, or 2.9 percent, to $25.24 in premarket trading. The stock has changed hands between $14.27 and $24.92 in the past 52 weeks, and ended Tuesday trading up almost 10 percent since the start of the year.