KENNETH COLE QUARTER NET UP 64.4%
Byline: Jennifer Weitzman
NEW YORK — Constancy and consistency again paid off for Kenneth Cole Productions in the first quarter as earnings, sales and even licensing revenues continued their double-digit moves upward.
Wednesday the company reported a first-quarter earnings spike of 64.4 percent to $7.8 million, or 35 cents per diluted share, from $4.7 million, or 23 cents, a year ago.
The footwear and accessories firm said revenues for the quarter ended March 31 increased 42.8 percent to $94.3 million from $66 million.
The company said that, by segment, wholesale revenues increased roughly 42 percent and consumer direct operations grew about 43 percent.
Licensing revenue picked up 61 percent, to $4 million, mostly from its men’s apparel and accessories arrangements.
Results blew past Wall Street’s consensus estimate of 29 cents a share. Shares closed at 40 13/16 Wednesday, up 5/16, on the New York Stock Exchange. The stock has traded as high as 46 1/8 and as low as 17 5/8 over the past year.
Kenneth D. Cole, president and chief executive officer, said he was pleased with his company’s “maintaining the performance of each of our brands across product categories throughout all channels of distribution.”
Joseph Teklits, an analyst with Ferris Baker Watts, based in Baltimore, said that Liz Claiborne’s upcoming Kenneth Cole women’s sportswear collection will be more powerful when it takes off, because Cole has “taken its time to grow its business in different avenues until the demand bubbled over.”
He characterized Cole as a “leading, well-nurtured brand that dominates its price point range,” as opposed to the recent stagnancy of certain designers.
Steven Marotta, vice president of Wasserstein Perella Security, said that Cole “has been able to solidly grow business while not sacrificing any quality or style issues.”
Teklits and Marotta both expect the firm to continue growing dramatically over the next few years by picking the right partnerships in areas such as outerwear, luggage and men’s apparel in addition to its already successful shoe and accessories lines.
Cole founded the company as a women’s footwear firm in 1982.
The company now derives less than half of its revenues from its original business.
Forty percent of sales are attributable to the designer’s streetwear-style shoes.
Kenneth Cole manufactures and markets products under three subordinate brands, Kenneth Cole New York, Kenneth Cole Reaction and Unlisted.