NEW YORK — Mossimo Inc. hit the bull’s-eye in the second quarter with profits that more than doubled on strong revenue gains.
For the three months ended June 30, the Santa Monica, Calif.-based designer firm, whose line is carried exclusively at Target discount stores, reported net income skyrocketed 142.3 percent to $3.7 million, or 23 cents a diluted share. That compares with last year’s earnings of $1.5 million, or 10 cents. Earnings per share eclipsed Wall Street forecasts by 4 cents.
Net revenues, which include license royalties and design service fees, expanded 44.7 percent to $7.4 million from $5.1 million a year ago.
Adding to the top- and bottom-line results was $1.5 million in non-recurring revenue that had been previously deferred by the company pending the results of a royalty audit that is now complete. Excluding that one-time revenue, second-quarter revenue would have increased a lesser 16 percent to $5.9 million and earnings would have been reduced by $600,000, or 4 cents.
Chief executive officer Mossimo Giannulli said in a statement, “Our partnership with Target continues to strengthen and we believe many opportunities for expansion still exist. Furthermore, our new relationship with the Zellers division of Hudson’s Bay Company in Canada provides us with another meaningful growth vehicle and further diversifies our business.”
For the six months, Mossimo reported net income up 74.8 percent to $6.7 million, or 43 cents a diluted share. That compares with last year’s profits of $3.8 million, or 25 cents. Total revenues for the period grew 27.9 percent to $13 million from $10.2 million a year ago.
Excluding the aforementioned $1.5 million one-time infusion, revenues would have grown 13.2 percent to $11.5 million.