Iconix Brand Group Inc. reported Tuesday a 69 percent jump in first-quarter earnings on a significant rise in licensing revenues.
The firm also revealed that it plans to acquire from United Features Syndicate Inc. and E.W. Scripps Co. the Peanuts brand for $175 million. The purchase will be made in collaboration with the Schulz family, who will own 20 percent of the brand.
Iconix said its first-quarter net income rose to $26.5 million, or 33 cents a diluted share, compared with earnings of $15.7 million, or 26 cents, a year ago. Analysts were expecting earnings per share of 31 cents in the latest quarter.
Licensing and other revenues totaled $71.7 million, up 42 percent from $50.5 million last year.
“We are having continued success with our direct-to-retail strategy, where almost across the board we saw double-digit sales increases. Over the past five years we have built a strong brand management platform with a powerful portfolio of 24 brands across fashion and home,” said Neil Cole, chairman and CEO of Iconix, in a written statement.
Iconix lifted its full year 2010 revenue estimate to $305 million to $315 million — assuming $35 million to $40 million from the Peanuts acquisition — up from a prior estimate for $260 million to $270 million.
The firm also expects earnings per share to reach $1.23 to $1.28, versus a prior forecast for $1.13 to $1.18. Analysts are expecting EPS of $1.29.
Regarding the Peanuts acquisition, Iconix said it has formed a new subsidiary, which will be 80 percent owned by Iconix and 20 percent by the Schulz family, in order to acquire the brand and other assets. According to Iconix, the Peanuts brand generates retail sales of $2 billion a year and is licensed in over 40 countries.
“The Peanuts brand is iconic, with some of the most beloved and well known characters in history. Peanuts is considered one of the most influential comic strips of all time and with its 60th anniversary this year the characters continue to be as popular as ever. Owning the Peanuts business moves Iconix well beyond fashion into a true global brand management entity with a wide variety of agreements that range from theme parks to media to financial institutions,” said Cole in a separate statement.
Once completed, the Peanuts buy is expected to add $75 million to Iconix’s annual royalty revenues and as much as 15 cents to annual earnings per share.