The buy-and-hold days are over at Iconix Brand Group Inc.
John Haugh on Friday presided over his first annual shareholders’ meeting as chief executive officer of Iconix Brand Group Inc. He joined the company in February as president and ascended to the ceo post in April.
The company last year saw several changes to its management structure. It also spent the better part of the year working with the Securities and Exchange Commission regarding queries to certain accounting issues. That matter — which also resulted in the restatement of certain financial statements — has since been closed, although the separate probe by the SEC enforcement division remains outstanding.
After a brief recap of the financials for 2015 — revenues down 3.3 percent to $379 million; generally accepted accounting principles net income down 21.2 percent to $82 million; organic revenue growth of 1 percent, and the generation of $189 million in free cash flow — Hough spoke briefly about the upcoming strategy for the company.
“We have been too passive in brand management. We are now active in brand management,” he said, explaining that brand management firms, in order to better position brands for growth, should be involved in the various aspects of the business when dealing with licensing partners.
He also said the company has divested noncore brands, contrary to the previous practice of holding on to brands for life.
The ceo said brands not meeting certain metrics are candidates for possible disposal. Even the ones that do well could be considered for sale if someone wants to buy them — that just means the brand was a good investment for the company, Haugh said.
The ceo also spoke about the men’s fashion business, which has seen better days. That business this year is “coming out of the woods,” Haugh said. “Men are still wearing pants, denim and hoodies. We have the brands. We just have to get in front of them,” he said.
Haugh declined to provide any deep dive on strategy because the company is reporting third-quarter results on Tuesday and will be hosting an Investor Day for analysts on Nov. 15. He did note that Iconix is the “biggest in this [brand-management] category. We invented this category,” adding that the plan includes building the business so that Iconix can broaden the gap further between it and the number-two firm in brand management.
The ceo told attendees: “I see nothing but opportunity.”
The company has hired a new head of marketing. Haugh said the name of the individual would be disclosed over the next few days.