NEW YORK -- Kenneth Cole Productions Inc. posted sharply lower fourth-quarter profits that still managed to beat analysts' estimates by 3 cents.
For the quarter ended Dec. 31, income plummeted 80 percent to $2.2 million, or 11 cents a diluted share, from $11.3 million, or 52 cents, in the year-ago quarter. Revenues fell 8.5 percent to $100 million from $109.9 million. Wholesale revenues were $43.1 million versus $50 million last year, while consumer direct revenues were $51.8 million compared with $54 million. Same-store sales were down 18 percent, and licensing revenue dipped to $5.1 million from $5.9 million.
Kenneth Cole, chairman and chief executive officer, said in a statement: "Stronger in-season business has improved our wholesale backlog which, at yearend, was 2 percent above last year's level after having been down by 15 percent to 20 percent for some time. This backlog trend has continued to strengthen since the close of the year."
The company provided 2002 earnings guidance in the range of 88 to 92 cents a share, higher than its earlier range of 81 to 87 cents in October.
Results were released after the close of the market Thursday. Indications of improving conditions helped move its shares up $2.79, or 15.5 percent, to close at $20.75 on the New York Stock Exchange Friday as the Dow Jones Industrial Average catapulted ahead 262.73 points, or 2.6 percent, to 10,368.86. The S&P Retail Index expanded 2.3 percent to end the day at 1,131.78.
KCP shares hit a 52-week high of $34.05 last May 22 and established their lowest point of the past year on Nov. 6, when they closed at $11.20.
"Each of our three brands is performing well at retail and we are continuing to develop some exciting new business initiatives, especially in our licensing and international division," the ceo said.
Cole also noted that the brands are in demand overseas, and that the firm is aggressively reviewing international opportunities.
"We are also enthusiastic about the pending launch of our Kids Reaction apparel business for fall, and finally, we are all very excited about the potential impact that the fragrance launch, and the expansive marketing campaign associated with it, is expected to have on all of our businesses this coming fall. While 2001 was exceptionally difficult, I believe we are a leaner, more focused company as a result," he said.For the year, income was down 57 percent to $16.6 million, or 80 cents a diluted share, from $38.4 million, or $1.75, in 2000. Revenues fell 5 percent to $386.1 million from $406.3 million.