Joe’s Jeans Completes Purchase of Earn-Out; Accretive to Earnings in FY2013 Excluding One-Time Charge
19 2월 2013 - 8:00PM
Business Wire
Joe’s Jeans Inc. (the “Company”) (NASDAQ: JOEZ) announced today
that it has entered into a new agreement with its founder, Joe
Dahan, to remove the contingencies related to the contingent
consideration payments that were to be made to him. The new
agreement fixes the overall amount to be paid to Mr. Dahan at
$9,168,000 over an accelerated time period. Excluding this charge
and the expense paid to date prior to entering into this new
agreement, the resulting savings in earn out expense is expected to
contribute earnings of $0.03 per share for the full year for fiscal
2013.
Marc Crossman, President and CEO, commented, “We are pleased
that we were able to enter into this new agreement with Joe Dahan.
As a result, going forward, Mr. Dahan’s sole financial incentive
comes from stock price appreciation through revenue and earnings
growth.” Crossman continued, “Previously, Mr. Dahan received a
percentage of the Company’s gross profit. However, as we continue
with our retail strategy, we expect our gross profit and gross
margin to grow.” Crossman summarized, “Now that we have purchased
the earn-out, the Company fully benefits from retail store and
other growth going forward.”
The Company expects to record the full amount of the buy-out
payment in the first quarter of fiscal 2013. Excluding this charge
and the expense paid to date, the Company expects the transaction
to be $0.03 accretive to earnings per share for the full year of
fiscal 2013 with further accretion in 2014 through 2017, the
original period for the earn-out.
The Company originally entered into the earn out in connection
with the merger in October 2007 with Mr. Dahan and his company, JD
Holdings Inc., for all right, title and interest in the “Joe’s
Jeans”, “Joe’s” and “JD” marks. The Company refers the reader to
its Current Report on Form 8-K and the preceding description of new
agreement is a summary of its material terms, does not purport to
be complete, and is qualified in its entirety by the copy of the
agreement which is filed as an exhibit thereto.
About Joe’s Jeans Inc.
Joe’s Jeans Inc. designs, produces and sells apparel and
apparel-related products to the retail and premium markets under
the Joe's® brand and related trademarks. More information is
available at the company website at www.joesjeans.com.
This release contains forward-looking statements within the
meaning of the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995, as amended. The matters discussed in
this document involved estimates, projections, goals, forecasts,
assumptions, risks and uncertainties that could cause actual
results or outcomes to differ materially from those expressed in
the forward-looking statements. All statements in this news release
that are not purely historical facts are forward-looking
statements, including statements containing the words “intend,”
“believe,” “estimate,” “project,” “expect” or similar expressions.
Any forward-looking statement inherently involves risks and
uncertainties that could cause actual results to differ materially
from the forward-looking statements. Factors that would cause or
contribute to such differences include, but are not limited to: the
risk that the transaction is not accretive to earnings, the risk
that the Company will be unsuccessful in implementing its retail
store strategy and improve its gross profits, the risk that the
Company will be unsuccessful in gauging fashion trends and changing
customer preferences; the risk that changes in general economic
conditions, consumer confidence, or consumer spending patterns will
have a negative impact on the Company’s financial performance or
strategies; and the highly competitive nature of the Company’s
business in the United States and internationally and its
dependence on consumer spending patterns. The Company discusses
certain of these factors in its additional filings with the SEC,
including its last annual report on Form 10-K and quarterly reports
on Form 10-Q filed with the SEC, and this release should be read in
conjunction with that annual report, together with all of the
Company’s other filings, including current reports on Form 8-K. The
Company urges you to consider all of these risks, uncertainties and
other factors carefully in evaluating the forward-looking
statements contained in this release. Any forward-looking statement
is based on information current as of the date of this document and
speaks only as of the date on which such statement is made, and the
Company undertakes no obligation to update these statements to
reflect events or circumstances after the date on which such
statement is made. Readers are cautioned not to place undue
reliance on forward-looking statements.
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