Cherokee Inc a leading global licensor and brand management company reported its royalty revenue for its first quarter ended May 5, 2007 (the "First Quarter"). Net revenues for the First Quarter decreased by 9.0% to $12.0 million, compared to revenues of $13.2 million in the comparable period last year.
Our First Quarter revenues do not include any royalty revenues from Mossimo (which accounted for $0.8 million in royalties in the first quarter of last year) because this contract was sold/terminated during fiscal 2007, or from Carrefour (which accounted for $0.2 million in royalties in the first quarter of last year) because this licensing agreement expired as of December 31, 2006.
Selling, general and administrative expenses for the First Quarter were $3.9 million, up from the $3.5 million reported in the comparable period last year.
The higher operating expenses in the First Quarter resulted from the following factors, among others: (i) higher payroll and related expenses of approximately $240,000, partially due to the payroll taxes associated with the payment of accrued bonuses from fiscal 2007 resulting from the one-time sale/termination of the Mossimo finders agreement; and (ii) a one-time payment of $254,000 pertaining to the 45% royalty share of the Carole Little royalties.
We acquired the 45% share of the Carole Little royalties in April 2007 for aggregate consideration of approximately $4.0 million and will not incur this $254,000 expense in future periods.
marketing@alchempro.com
