Cherokee posts flat revenue in Q2

Cherokee Global Brands second quarter revenues of 8.5 million dollars were flat with the prior-year period. During the quarter, Cherokee brand revenue increase in South America, India, Middle East, South Africa, and Asia were offset by a decrease in North American royalty revenues as the company transitions the brand from Target to its new wholesale licensing partners.

“As we advance through fiscal 2017, we are pleased with our ability to further build our brand platform and diversify our global business,” noted Henry Stupp, CEO of the company, adding, “We continue to make meaningful progress with the Cherokee brand in the US, signing another licensee partner for home decor, further setting the stage for an exciting, multi-category launch in the Spring of 2017.”

Review of the first half performance

The company also recognized approximately 443 thousand dollars of revenues related to Flip Flop Shops. For the first six months of fiscal 2017, revenues increased 2 percent to 19.2 million dollars from 18.7 million dollars in the prior year period.

Operating income totaled 2.5 million dollars on GAAP basis, or 30 percent of revenues, compared to 3.1 million dollars, or 37 percent of revenues, in the prior-year period. Operating income for the six-month period totaled 6.8 million dollars, or 36 percent of revenues, compared with 8.9 million dollars, or 48 percent of revenues in the prior year period. Non-GAAP operating income for the second quarter was 3.2 million dollars or 37 percent of revenues, consistent with 3.3 million dollars or 39 percent of revenues, in the prior year period.

GAAP net income totaled 1.5 million dollars, or 0.17 dollar per diluted share, compared to 1.9 million dollars, or 0.22 dollar per diluted share, in the prior-year period. For the six-month period, GAAP net income totaled 4.1 million dollars, or 0.47 dollar per diluted share. This compares to 5.5 million dollars or 0.62 dollar per diluted share, in the prior-year period.

Non-GAAP net income for the second quarter totaled 1.9 million dollars or 0.22 dollar per diluted share. This compares to 2 million dollars or 0.23 dollar per diluted share, in the prior-year period. For the six-month period, non-GAAP net income totaled 4.9 million dollars, or 0.56 dollar per diluted share.

Picture:Cherokee USA