Cherokee continues to expand 'world brand' strategy
08 Dec '06
3 min read
Cherokee Inc reported its highest ever third quarter revenue and earnings for its quarter ended October 28, 2006.
Net revenues for the three months ended October 28, 2006 rose 5.3% or $0.4 million to $8.8 million, compared to revenues of $8.4 million in the comparable period last year.
Selling, general and administrative expenses for the three months ended October 28, 2006 were $3.5 million, which is above the $3.0 million in the comparable period last year, primarily due to increases in payroll related expenses, stock option compensation expenses of $181,000 resulting from the Company's adoption of SFAS 123R, and an increase in our travel and marketing expenses commensurate with our implementation of our world brand strategy.
Interest and other income for the three months ended October 28, 2006 totaled $179,000 versus the $119,000 reported last year.
Net earnings for the three months ended October 28, 2006 increased by 1.0% to $3.28 million or $0.37 per diluted share, compared to $3.25 million or $0.37 per diluted share in the year ago period. The Company ended the quarter with cash and equivalents of $10.5 million, net receivables of $8.2 million and no debt.
On November 1, 2006 Cherokee Inc received a payment of $33.0 million from Iconix Brand Group Inc, pursuant to the terms of the Termination and Settlement Agreement entered into by Iconix and Cherokee earlier this year.
In addition, Cherokee also received payment of $900,000 of past royalties, representing the unauthorized deduction previously taken by Mossimo Inc from royalties due to Cherokee in its fiscal 1st Quarter.