Iconix Brand Group, Inc.
) posted fourth quarter 2013 adjusted earnings of 54 cents per
share, ahead of the Zacks Consensus Estimate of 51 cents and
up 32% from the year-ago levels. The upswing can be attributed to
solid revenues, strategic acquisitions and lower share count owing
to share buyback.
Quarter in Detail
Total revenue of $105.3 million was in line with the Zacks
Consensus Estimate. Revenues surged 24% year over year driven by
the company's recent acquisitions (Umbro, Buffalo and Lee Cooper),
strong performance of core brands and increased contribution from
international joint ventures. During the quarter, the company
formed two new international joint ventures in Southeast Asia and
Israel. These joint ventures together contributed approximately $7
million to revenues in the quarter.
On a year-over-year basis, earnings before interest, taxes,
depreciation, and amortization (EBITDA) increased 20% to $60.1
million in the fourth quarter.
Iconix exited the quarter with free cash flow of $62.9 million
compared with $54.3 million at the end of the third quarter of
During the fourth quarter, the board of Iconix authorized a new
share repurchase program of $500 million for three years. The
company currently has approximately $110 million remaining under
the previous $300 million stock repurchase program approved in Jul
In 2013, Iconix posted adjusted earnings of $2.39 per share,
beating the Zacks Consensus Estimate of $2.33 per share by 2.6%.
Earnings came within the company's guided range of $2.30-$2.40 per
share and increased 41% from the year-ago earnings of $1.70, fueled
by higher sales, continued international expansion, acquisition of
three global brands and lower share count owing to share buybacks.
In 2013, the company formed four new international joint ventures
in Canada, Australia, Southeast Asia and Israel. With these joint
ventures and acquisition of global brands, the company's
international business contributes 37% of the total business, up
from 24% in 2012.
Total revenue grew 22% to $432.6 million, in line with the Zacks
Consensus Estimate and within the company's guided range of
Guidance for 2014
Iconix reiterated its earnings and revenue guidance for 2014. The
company continues to expect revenues in the range of $440
million-$455 million. Adjusted earnings are expected in the range
of $2.50-2.60 per share for 2014. Free cash flow is expected in the
range of $210-$217 million.
Iconix's fourth quarter was quite weak, but its overall growth
story looks compelling. This clothing brand licensing company has
been aggressively acquiring brands and entering into joint ventures
to expand its portfolio. Going forward, the company expects
international expansion to boost organic growth for its brands.
Iconix holds a Zacks Rank #3 (Hold). Better-ranked stocks in the
consumer discretionary sector include
Joe's Jeans Inc.
Michael Kors Holdings Ltd
), all with a Zacks Rank #1 (Strong Buy).
(We are re-publishing this article to correct an inaccuracy:
the earlier version of the article, released Friday, Feb 21, had
erroneously referred to the Iconix earnings report as an earnings
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