Leading global licensor and brand management company Cherokee Inc has reported its highest ever revenue for its first quarter ended April 29th 2006.
The net revenues for the first quarter rose 0.1 percent to $13.228 million, compared to revenues of $13.213 million in the comparable period last year. However, first quarter revenues include just $0.8 million attributable to Mossimo Inc, as compared to $1.2 million reported for the first quarter of last year, despite the fact that retail sales of Mossimo branded products at Target have grown during the first quarter as compared to the comparable period last year.
Cherokee believes that Mossimo Inc has made an unauthorized deduction of $900,000 of royalties that are owed to us for sales during the first quarter. Nonetheless, it currently expects to receive this $900,000 of royalty revenues due from Mossimo during its second quarter of fiscal 2007 concurrent with the closing of Iconix Brand Group's acquisition of Mossimo, and it will be recognized as royalty revenues at the time such funds are received.
As a consequence, Cherokee's first quarter royalty revenues were essentially flat when compared to the first quarter of last year.
The net earnings for the three months ended April 29th 2006 decreased by 2.9 percent to $5.9 million compared to $6.1 million in the year ago period. The company ended the quarter with cash and equivalents of $9.2 million, trade receivables of $12.6 million, and no debt.
marketing@alchempro.com
