POST-IPO GARGOYLES HAS LOSS IN QUARTER
KENT, Wash. — Gargoyles Inc., in its first report since its September initial public offering, lost $15,429 in the third quarter ended Sept. 30, despite a 70.7 percent sales hike.
In the year-ago period, Gargoyles earned $196,510, or 3 cents a share.
The loss for the sunglasses manufacturer was caused by a $305,000 compensation charge tied to its September IPO.
Due to the early repayment of debt, the company also noted, it will take a $200,000 charge in the fourth quarter for the accelerated amortization of loan fees.
Operating profits were up 5.6 percent to $649,362 from $614,941, but gross margins declined to 58.1 percent of sales from 62.5 percent.
Sales rose to $8.9 million from $5.2 million.
Doug Hauff, president and chief executive officer, attributed the strong sales growth and improved operating performance to new products, continued growth of the Gargoyles brand and the successful integration of its February acquisition of Hobie, a line of polarized sunglasses.
“We believe the completion of our IPO has positioned the company to take advantage of new growth opportunities in the future,” Hauff added.
Gargoyles raised $28 million in its IPO from the sale of 1.95 million shares at $16 each.
In the nine-month period ended Sept. 30, Gargoyles lost $2.6 million after nonrecurring stock compensation charges of $3.5 million, the $305,000 charge from the IPO and higher interest expense.
In the year-ago period, the company earned $279,168, or 5 cents. Sales gained 85 percent to $26.5 million from $14.3 million.