Candie's, Inc. Reports Second Quarter and Six-months Results.Business Editors NEW YORK--(BUSINESS WIRE)--Sept. 6, 2001 -- Operating Income Increases 383% to $1.3 Million-- -- 2Q01 Backlog up 45.8% Year-Over-Year -- -- Fully Diluted Earnings per Share $0.04 vs. $0.01 a Year Ago -- Candie's, Inc. (Nasdaq:CAND) today announced operating results for the second quarter ended July July: see month. 31, 2001. Net revenues for the period increased 13.2% to $31.9 million versus $28.2 million in the year-ago quarter. The revenue increase was primarily driven by increases in the sales of Candie's branded women's footwear Footwear consists of garments worn on the feet. It is worn for a variety of reasons, including protection against the environment, hygiene and adornment. Usually, socks and other hosiery are worn between the feet and the footwear, except for sandals and flip flops (thongs). . Additionally, sales through the Company's ten retail stores doubled year-over-year to $2.2 million, driven by three new stores and a comparable store sales increase of 35.8%. Licensing revenues for the period were $1.3 million. Gross profit margin Gross profit margin Gross profit divided by sales, which is equal to each sales dollar left over after paying for the cost of goods sold. gross profit margin A measure calculated by dividing gross profit by net sales. for the second quarter was 26.6%, versus the prior year's quarter of 27.1%. This decrease was more than offset by an improvement in SG&A to $7.2 million, or 22.6% of sales in the current quarter, from $7.4 million, or 26.2% of sales in the same period for the prior year. As a result, operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. grew to 383% to $1.3 million versus $263,000 for the prior year's second quarter. Net income for the quarter was $974,000 versus $175,000 for the prior year's quarter. The Company reported fully diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of for the second quarter of $0.04 versus $0.01 in the second quarter of fiscal 2001. Neil Cole Neil Cole (born 1 March 1972) is an English television presenter, comedian, radio broadcaster and actor. Early life Cole was born in Bristol in 1972, and attended King Edward Grammar School in Chelmsford. He studied English & French Literature at Bristol University. , Candie's, Inc.'s Chief Executive Officer, said, "We are encouraged by the progress we have begun to show in all aspects of our business. Our continued focus on product and the increased acceptance of the Candie's brand with our target consumer give us confidence that we can continue to grow our presence in the market and leverage our many opportunities. We believe that we have built the foundation for rapid growth and profitability in the short and long term." For the six months ended July 31, 2001, the Company recorded net revenues of $55.7 million, as compared to $53.6 million in the comparable period of the prior year. Increases in sales of Candie's women's footwear, Company-owned retail stores, and private label products were offset by sales decreases in other divisions. Licensing income increased to $2.5 million during the period from $2.3 million in the prior year. For the six months ended July 31, 2001, operating profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. increased 82.6% to $2.0 million, compared to $1.1 million in the comparable period of the prior year. Net income for the six months was $1.4 million versus $640,000 for the prior year six months. Fully diluted earnings per share for the six months doubled to $0.06 versus $0.03 in the comparable period of the prior year, on a 3% increase in shares outstanding. About Candie's, Inc. Candie's Inc. is a leading designer and marketer of young women's footwear, apparel and accessories. The Company distributes its products through better department and specialty stores Noun 1. specialty store - a store that sells only one kind of merchandise shop, store - a mercantile establishment for the retail sale of goods or services; "he bought it at a shop on Cape Cod" nationwide, as well as through ten company-owned stores and specialty stores internationally. Candie's also owns and markets footwear, accessories and apparel under the Bongo trademark. Candie's also arranges for the manufacture of footwear products for mass market and discount retailers under the private label brand of the retailer or other trademarks owned or licensed by Candie's. Additionally, the Candie's brand is licensed for the manufacture, sale and distribution of fragrances and cosmetics cosmetics, preparations externally applied to change or enhance the beauty of skin, hair, nails, lips, and eyes. The use of body paint for ornamental and religious purposes has been common among primitive peoples from prehistoric times (see body-marking). , handbags, sunglasses sunglasses A tinted pair of glasses used to ↓ light arriving at the eye, which are labeled according to the amount of UV light blocked; nonprescription glasses are classified according to use and amount of UV radiation blocked Sunglasses , watches, apparel and cell phone accessories. Candie's Inc. operates www.candies.com, a leading community for teens on the web. For investor information please visit the corporate web site at www.candiesinc.com. SAFE HARBOR Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and OF 1995. The statements which are not historical facts contained in this press release are forward looking statements that involve a number of known and unknown risks, uncertainties and other factors all of which are difficult or impossible to predict and many of which are beyond the control of the Company, which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied Inferred from circumstances; known indirectly. In its legal application, the term implied is used in contrast with express, where the intention regarding the subject matter is explicitly and directly indicated. by such forward looking statements. Such factors include, but are not limited to the risks detailed in the Company's Securities and Exchange Commission filings, and uncertainty associated with the impact on the Company in relation to recent events discussed in the Company's Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for fiscal 2001. The words "believe", "expect", "anticipate", "seek" and similar expressions identify forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. . Readers are cautioned not to place undue reliance on these forward looking statements.
Candie's, Inc.
Condensed Consolidated Statements of Operations (Unaudited)
(000's omitted, except per share data)
Three Months Ended Six Months Ended
July 31, July 31,
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2001 2000 2001 2000
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Net sales $30,570 $26,852 $53,222 $51,298
Licensing income 1,316 1,307 2,518 2,339
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Net revenue 31,886 28,159 55,740 53,637
Cost of goods sold 23,419 20,530 39,606 39,293
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8,467 7,629 16,134 14,344
Operating expenses:
Selling, general
and administrative 7,019 7,277 13,903 13,069
Special charges 178 89 243 186
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7,197 7,366 14,146 13,255
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Operating income 1,270 263 1,988 1,089
Other expenses:
Interest expense - net 296 389 621 900
Equity (income) loss
in joint venture - (336) - (486)
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296 53 621 414
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Income before income taxes 974 210 1,367 675
Provision (benefit) for
income taxes - 35 - 35
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Net income $974 $175 $1,367 $640
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Earnings per share:
- Basic $0.05 $0.01 $0.07 $0.03
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- Diluted $0.04 $0.01 $0.06 $0.03
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Weighted average No.
of common shares:
- Basic 19,169 19,252 19,153 19,220
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- Diluted 22,327 21,737 22,405 21,760
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Selected Balance
Sheet Data: 7/31/2001 1/31/2001
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Current Assets $ 32,698 $ 23,772
Current Liabilities $ 31,417 $ 24,472
Stockholders' Equity $ 26,442 $ 24,745
Working Capital $ 1,281 $ (700)
Current Ratio 1.04:1 0.97:1
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