Orlando, FL 4/25/12 (StreetBeat) -- Shares of Iconix Brand Group Inc. (Nasdaq:ICON) tumbled 10 percent Wednesday morning after the clothing company reported that first-quarter net income fell 12 percent, hurt by weaker demand in its men's division and the delayed closing of a deal.Results missed expectations and Iconix cut its forecast.
Iconix, which licenses clothing brands such as Candie's, Mossimo and London Fog, said net income for the three months ended March 31 fell to $27.6 million, or 37 cents per share. That compares with $31.4 million, or 42 cents per share, in the same months last year. Excluding a one-time charge related to interest expenses, net income was 43 cents per share, shy of analyst expectations of 45 cents per share.
Revenue fell 4 percent to $88.5 million from $92.4 million a year ago. Analysts expected revenue of $95 million.
Iconix said it is still waiting on government approval for a joint venture with Indian company Reliance Industries Group to sell Iconix's fashion brands in India, part of its plan to expand its international business. The deal was announced in February and was expected to close this quarter. It would have contributed $5 million to $6 million in revenue and 4 cents to 5 cents per share in net income. The company expects the deal to close in the second quarter, which ends in June, saying the delay "is purely a timing issue."
Iconix wants to increase international revenue, especially from fast-growing regions in Asia and Latin America, to a third of its business.
Also on Wednesday, Iconix cut its guidance due to weakness in its men's division, particularly Rocawear, Ecko and Ed Hardy, and other delays in international plans. The company said there are global initiatives it doesn't expect to complete this year.
It now expects adjusted net income in 2012 will be $1.65 to $1.74, from prior guidance of $1.77 to $1.84 per share. Analysts expect net income of $1.79 per share.
Iconix predicts 2012 revenue of $340 million to $350 million, from prior guidance of $370 million to $385 million. Analysts expect revenue of $377.5 million.
Shares fell $1.76, or 10.3 percent, to $15.26 in morning trading. The stock has ranged from $14.36 to $26.05 over the past 12 months, and is down about 7 percent in 2012.
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