Iconix narrows losses despite plummeting sales
NYC-based brand management company Iconix Brand Group, Inc. announced its financial results for the third quarter of 2018 on Friday, reporting narrowed losses despite tumbling sales dragged down by the group’s men’s segment.
Iconix’s revenue for the third quarter ended September 30, 2018 totaled $46.2 million, a 13% decline when compared to the $53.2 million reported in the prior-year period. The biggest percentage decrease was in the company’s men’s segment where revenues plunged 36% to $7.3 million, largely due to the underperformance of Iconix’s Starter and Buffalo brands.
The company’s international business was the only segment to post a sales increase, with revenue rising 26% to $16.7 million, thanks to progress with the Umbro and Lee Cooper brands, particularly in Europe, India and China.
“While the domestic business did not see the progress we had hoped for, our international business continued its profitable growth,” said Iconix CEO Bob Galvin in a release. “We are critically evaluating our operational cost structure to ensure it is aligned with our current level of business and near term plans.”
Iconix’s net loss for the quarter came to $20.2 million, a marked improvement from Q3 2017’s loss of $550.6 million, despite being negatively impacted by an $8.2 million bad debt expense incurred as a result of the recent Sears bankruptcy filing.
Year to date the company’s revenue fell 16% to $145.0 million, compared to $173.5 million in the prior-year period, while net loss totaled $31.4 million, compared to a loss of $559.7 million.
Due to its largely disappointing results, Iconix has lowered its full-year 2018 guidance and now expects revenue to be in the range of $185 million to $195 million.
Full-year net loss is now predicted to be between $105 million and $115 million, a decline compared to the company’s previously reported outlook of $94.4 million to $104.4 million.
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