Sequential Brands Swings into Q1 Profit, Sales Rise

In Industry News, What's New by Jeff Prine

ellen tracyNew York—Sequential Brands reported Thursday that it swung into a first quarter profit since converting to a licensing and brand management business model.

For the quarter ended March 31, the owner and marketer of Ellen Tracy, William Rast, Revo, Caribbean Joe, Heelys, DVS, The Franklin Mint and People’s Liberation posted net income of $700,000, or 3 cents a share, compared with a net loss of $21.5 million, or $2.96 a year, in the year-ago quarter.

Total revenue was $6.3 million compared with $1.6 million in first quarter last year.

‘An Exciting Time’

“This is an exciting time for Sequential Brands Group,” said CEO Yehuda Shmidman. “We achieved record first quarter results since converting to a licensing and brand management business model, and we continue to be optimistic about our future ability to grow our portfolio both organically and through new brand acquisitions. As we continue to execute on our playbook, we believe our portfolio can achieve upwards of $100 million in annual royalty revenue in the next three years.”

For 2014, Sequential forecast sales between $28 million to $30 million from its existing portfolio of brands. The company expects “margin expansion to continue as the company acquires additional brands.”