Cherokee Profit Falls 12 Percent

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Apparel brand licensing company Cherokee Inc. said Wednesday the poor economy and a weak dollar overseas drove down net income by 12 percent in its third quarter.

Van Nuys-based Cherokee reported net income of $3.3 million (37 cents per share) for the quarter ended Nov. 1, compared with net income of $3.7 million (41 cents) a year ago. Revenue fell 10 percent to $8.04 million.

The company said it had reduced expenses, particularly in marketing and payroll, to offset the weaker sales, but did not say how many jobs may have been cut. The company, whose brands include Cherokee, Sideout and Carole Little, licenses clothing brands in more than 30 countries. Last month it entered Peru.

“We are not immune to the soft global retail environment, and are always disappointed with any revenue declines,” said Chief Executive Robert Margolis in a statement. “However, we take comfort in our highly profitable business model with no inventory, no manufacturing and no debt.”

Cherokee shares were up $1.14, or 8 percent, to $15.14 in morning trading on the Nasdaq.

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