Cherokee Boasts Q1 Profit, Sales Ahead of Estimates

In Industry News, What's New by Jeff PrineLeave a Comment

cherokeeSherman Oaks, CA—Cherokee Inc., now known as Cherokee Global Brands, today sailed past estimates as its profit and sales jumped, sending its shares up in early trading today.

For the quarter ended May 3, the parent to Cherokee, Sideout and Carole Little brands posted net income of $3.6 million, 43 cents a share, compared with $2.2 million, or 27 cents a share, in the prior year period. That handily beat analysts’ estimate for 25 cents a share.

Licensing Model

Revenue rose 23.7% to $10 million, compared with $8.1 million, a year ago. That compared with a $9.18 million in sales analysts had predicted.

The increase in revenues relates to continuing organic growth of the Cherokee brand and the recent Tony Hawk brands acquisition, the company noted.

Selling, general and administrative expenses fell 11% to $4.8 million due mostly to about a $1 million of professional and consulting fees that did not recur this year.

“This is an exciting time for Cherokee Global Brands. The first quarter marked our strongest top and bottom line results since I joined the company three years ago, and an extremely solid start to the fiscal year,” said CEO Henry Stupp. “Consistent with our initiatives, our focus lies on taking our group of brands, and making them even better, while expanding our global footprint. We continue to unlock the value and potential of Cherokee Global Brands through our turn-key 360˚ degree licensing model. Through this transformation we are now able to deliver higher quality product and services than ever before.”