Iconix pushed into loss by coronavirus
May 13, 2020
Iconix Brand Group, Inc., the New York-based owner of brands including Umbro, Lee Cooper and Ecko Unltd., announced a net loss of $21.5 million for the first quarter ended March 31, 2020, on Tuesday, down from income of $17.9 million in the prior-year period. Per diluted share, net loss was $1.86, compared to a loss of $0.01.
The company’s total quarterly revenue was $28.0 million, decreasing 22% from $35.9 million in the same period in the previous year, principally due to the negative economic impact of the Covid-19 pandemic.
Iconix’s men’s segment saw a particularly sharp decline of 38% in its revenues, which totaled $6.8 million, down from $10.9 million in Q1 2019, while revenues in the women’s segment also registered a 23% decrease, largely due to a drop in licensing revenue from the company’s Mudd brand.
Sales also fell 9% in the group’s home segment and 12% in its international segment, mainly related to declines in Latin America and Europe.
“While we began 2020 focused on the continued stabilization of our business and our operational cost structure, the Covid-19 pandemic has had a meaningful near-term impact on our business and that of our licensees,” said Iconix Brand Group CEO Bob Galvin in a release.
“Even with this disruption, we continued to develop our pipeline of future business, as we signed 41 deals during 2020 for aggregate guaranteed minimum royalties of approximately $24 million,” he added.
In response to the economic pressures caused by the coronavirus pandemic, the company has reduced its headcount and eliminated non-essential operating expenses, achieving more than $10.0 million in annualized cost savings.
In light of the uncertainty surrounding the ongoing health crisis, Iconix has not provided a financial outlook for fiscal 2020.
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