Candie's Inc. Reports Third Quarter Net Income of $603,000; Licensing income $2.7 million versus $1.8 in prior year quarter.NEW YORK New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of -- Candie's Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : CAND) (the "Company") today announced its results for the third quarter and nine months ended October 31, 2004 of its fiscal year ending January 31, 2005. The Company reported consolidated net income of $603,000 or $0.02 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share for the quarter, as compared to a loss of $1.9 million or $0.07 loss per share for the prior year quarter. Licensing income for the quarter increased by 50.7% to $2.7 million from $1.8 million in the prior year quarter and operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. decreased by 31.2% from $7.0 million to $4.8 million. The Company is completing the process of transforming from a 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). and jeanswear operating company operating company A business that engages in transactions with outsiders. to a multi-brand licensing and management business. The Company licensed its CANDIE'S(R) and BONGO(R) footwear operations in May 2004, and effective last August, it licensed BONGO jeanswear, which will begin generating licensing income as of the fourth quarter of this year and be fully transitioned by January 31, 2005. As previously announced in November 2004, the Company acquired the designer trademark BADGLEY MISCHKA Badgley Mischka is an American fashion label designed by Mark Badgley and James Mischka. Badgley & Mischka met at Parsons and found a common vision. The two launched the label Badgley Mischka in 1988, though their bridal business launched in 1993. (R), and as more recently announced, the Company has licensed CANDIE'S to Kohl's Department Stores This is a list of department stores. In the case of department store groups the location of the flagship store is given. This list does not include large specialist stores, which sometimes resemble department stores. , with plans to launch CANDIE'S as a lifestyle brand in Fall 2005, with exclusivity in all categories except optical by the end of 2006. Chairman and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. 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. said "Our third quarter numbers begin to reflect the potential profitability of the licensing business under our new brand management model. We are very excited about the recently announced retail direct license with Kohl's for CANDIE'S, and have completed the transition of BONGO jeans wear to our new licensee licensee n. a person given a license by government or under private agreement. (See: license, licensor) LICENSEE. One to whom a license has been given. 1 M. Q. & S. 699 n. . These two significant licenses, when added to the potential that we see for BADGLEY MISCHKA, provide a solid platform for sustained growth in the future." For the nine months ended October 31, 2004, the Company reported consolidated net income of $1.2 million versus a loss of $4.9 million in the prior year period. Licensing income increased nearly 40% to $6.7 million from $4.8 million in the prior year and operating expenses decreased from $29.3 million to $13.7 million. The Company also announced that beginning January 1, 2005, it will change its fiscal year to a calendar year beginning on January 1st and ending on December 31st. The change is designed to align align (  līn),v to move the teeth into their proper positions to conform to the line of occlusion. the Company's financial reporting with that of its licensees. As a result, the current fiscal year will be reported as an eleven month period ending on December 31, 2004. Shareholders are invited to listen to the conference call scheduled for today at 10:00 AM Eastern Daylight Time. The call will be web cast live via the Internet and can be accessed by logging on to www.candiesinc.com and clicking on the "Live Web cast" link on the "Investor's Overview" page. The call will be archived on the web and a replay can also be accessed via telephone by dialing (888) 286-8010 and entering the passcode 48299476. The replay will be available through December 22, 2004. About Candie's, Inc. Candie's, Inc. is in the business of licensing the CANDIE'S, BONGO and BADGLEY MISCHKA trademarks on a variety of women's apparel, footwear and accessories. Through its wholly owned subsidiary Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. Brightstar Footwear, Inc., the Company also arranges for the manufacture of footwear products for mass market and discount retailers under the private label brand of the retailer. For investor information please visit the corporate web site at http://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 that 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 by such forward looking statements. Such factors include, but are not limited to, uncertainty regarding the results of the Company's decision to license its footwear business, continued market acceptance of current products and the ability to successfully develop and market new products particularly in light of rapidly changing fashion trends, the impact of supply and manufacturing constraints CONSTRAINTS - A language for solving constraints using value inference. ["CONSTRAINTS: A Language for Expressing Almost-Hierarchical Descriptions", G.J. Sussman et al, Artif Intell 14(1):1-39 (Aug 1980)]. or difficulties relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the Company's dependence on foreign manufacturers and suppliers, uncertainties relating to customer plans and commitments, the ability of licensees to successfully market and sell branded products, competition, uncertainties relating to economic conditions in the markets in which the Company operates, the ability to hire and retain key personnel, the ability to obtain capital if required, the risks of litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. and regulatory proceedings, the risks of uncertainty of trademark protection, the uncertainty of marketing and licensing acquired trademarks and other risks detailed in the Company's SEC filings. The words "believe", "anticipate," "expect", "confident", 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, which speak only as of the date the statement was made.
Candie's, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(Unaudited)
Three Months Ended Nine Months Ended
October 31, October 31,
--------------------------------------------
2004 2003 2004 2003
(000's omitted, except per share data)
Net sales $ 10,679 $ 25,305 $ 54,558 $106,382
Licensing income 2,725 1,808 6,745 4,827
-------- -------- -------- --------
Net revenues 13,404 27,113 61,303 111,209
Cost of goods sold 7,320 21,189 44,383 84,322
-------- -------- -------- --------
Gross profit 6,084 5,924 16,920 26,887
Operating expenses:
Selling, general and
administrative expenses 4,824 6,251 13,574 25,668
Special charges - 764 99 3,648
-------- -------- -------- --------
4,824 7,015 13,673 29,316
-------- -------- -------- --------
Operating income (loss) 1,260 (1,091) 3,247 (2,429)
Interest expense 657 746 2,093 2,462
-------- -------- -------- --------
Income (loss) before
income taxes 603 (1,837) 1,154 (4,891)
Income tax expense - 47 - 47
-------- -------- -------- --------
Net income (loss) $ 603 $ (1,884) $ 1,154 $ (4,938)
======== ======== ======== ========
Earnings (loss)
per common share:
Basic $ 0.02 $ (0.07) $ 0.04 $ (0.20)
======== ======== ======== ========
Diluted $ 0.02 $ (0.07) $ 0.04 $ (0.20)
======== ======== ======== ========
Weighted average
number of common
shares outstanding:
Basic 27,264 25,372 26,633 25,153
======== ======== ======== ========
Diluted 29,462 25,372 28,037 25,153
======== ======== ======== ========
Selected Balance Sheet Data:
10/31/2004 01/31/2004
Current Assets 10,675 25,655
Total Assets 60,689 74,845
Current Liabilities 14,673 29,905
Shareholders' Equity 24,016 18,868
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