Iconix Brand Group, Inc. (ICON) lowered its full year 2009 revenue guidance to a range of $215 million to $220 million compared to its previous guidance range of $223million to $230 million.
Management also lowered the 2009 earnings guidance to a range of $1.17 to $1.22 per share from the previous range of $1.30 to $1.35. The company now expects 2009 free cash flow in the range of approximately $123million to $126 million.
The lower guidance primarily reflects approximately 12 cents of dilution related to the company’s equity offering in June, wherein it had issued an additional 10.7 million shares. Further, management also expects about 4 cents of negative impact related to the transition of the Rocawear women’s license to a new licensee.
After the announcement, the company’s stock plunged 21% to $12.47 on September 30, 2009 versus $15.80 on September 29, 2009. For the past year, the stock has been trading in the range of $5.11 to $18.30. The company also provided guidance for the third quarter of 2009. Management expects revenue for the third quarter to be in the range of $53 million to $56 million. The guidance reflects a 4% increase compared to the prior-year quarter.
Third quarter earnings are expected to be in the range of 26 cents to 28 cents, which includes approximately 5 cents of dilution related to the company’s June equity offering and about 4 cents of negative impact related to the transition of the Rocawear women’s license to a new licensee.
The company reiterates its guidance of 5% organic growth across its portfolio of brands. Further, Iconix Brand Group currently has about $230 million of cash.
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