Iconix Brand Group is a brand management company and owner of a diversified
portfolio of over 35 global consumer brands across women’s, men’s,
entertainment and home industry segments. The Company’s business strategy
is to maximize the value of its brands primarily through strategic licenses
and joint venture partnerships around the world, as well as to grow the portfolio
of brands through strategic acquisitions.
The Company’s brand portfolio includes Candie’s ®, Bongo ®,
Badgley Mischka ®, Joe Boxer ® , Rampage ® , Mudd ® , London
Fog ® , Mossimo ® , Ocean Pacific/OP ® , Danskin/Danskin Now ®
, Rocawear ® /Roc Nation ® , Cannon ® , Royal Velvet ® , Fieldcrest
® , Charisma ® , Starter ® , Waverly ® , Ecko Unltd ® /Mark
Ecko Cut & Sew ® , Zoo York ® , Sharper Image ® , Umbro ®
, Lee Cooper ® , Strawberry Shortcake ® and Artful Dodger ®; and
interest in Material Girl ® , Peanuts ® , Ed Hardy ® , Truth or
Dare ® , Billionaire Boys Club ® , Ice Cream ® , Modern Amusement
® , Buffalo ® , Nick Graham ® Hydraulic ®, and PONY ®.
The Company seeks to monetize the Intellectual Property (herein referred to
as “IP”) related to its brands throughout the world and in all relevant
categories by licensing directly with leading retailers (herein referred to
as “direct to retail” or “DTR”), through consortia of
wholesale licensees, through joint ventures in specific territories and via
other activity such as corporate sponsorships and content as well as the sale
of IP for specific categories or territories. Products bearing the Company’s
brands are sold across a variety of distribution channels from the mass tier
to the luxury market and, in the case of the Peanuts and Strawberry Shortcake
brands, through various media outlets, including television, movies, digital
and mobile content. The licensees are responsible for designing, manufacturing
and distributing the licensed products. The Company supports its brands with
marketing, advertising and promotional campaigns designed to increase brand
awareness. Additionally the Company provides its licensees with coordinated
trend direction to enhance product appeal and help build and maintain brand
integrity. In the case of Peanuts and Strawberry Shortcake brands, we also provide
content for licensed media categories.
Globally, the Company has over 50 direct-to-retail licenses and more than 1,700
total licenses. Licensees are selected based upon the Company’s belief
that such licensees will be able to produce and sell quality products in the
categories and distribution channels of their specific expertise and that they
are capable of exceeding minimum sales targets and royalties that the Company
generally requires for each brand. This licensing strategy is designed to permit
the Company to operate its licensing business, leverage its core competencies
of marketing and brand management with minimal working capital, and without
inventory, production or distribution costs or risks, and maintain high margins.
The vast majority of the Company’s licensing agreements include minimum
guaranteed royalty revenue which provides the Company with greater visibility
into future cash flows.
A key initiative in the Company’s global brand expansion plans has been
the formation of international joint ventures. The strategy in forming international
joint ventures is to partner with best-in-class, local partners to bring the
Company’s brands to market more quickly and efficiently, generating greater
short- and long-term value from its IP, than the Company believes is possible
if it were to build-out wholly-owned operations ourselves across a multitude
of regional or local offices. Since September 2008, the Company has established
the following international joint ventures: Iconix China, Iconix Latin America,
Iconix Europe, Iconix India, Iconix Canada, Iconix Australia, Iconix Southeast
Asia, Iconix Israel and Iconix Middle East.
The Company also plans to continue to build and maintain its brand portfolio
by acquiring additional brands directly or through joint ventures. In assessing
potential acquisitions or investments, the Company primarily evaluates the strength
of the target brand as well as the expected viability and sustainability of
future royalty streams. The Company believes that this focused approach allows
it to effectively screen a wide pool of consumer brand candidates and other
asset light businesses, strategically evaluate acquisition targets and complete
due diligence for potential acquisitions efficiently.
The Company’s primary goal of maximizing the value of its IP also includes,
in certain instances, the sale to third parties of a brand’s trademark
in specific territories or categories. As such, the Company evaluates potential
offers to acquire some or all of a brand’s IP by comparing whether the
offer is more valuable than the Company’s estimate of the current and
potential revenue streams to be earned via the Company’s traditional licensing
model. Further, as part of the Company’s evaluation process it also considers
whether or not the buyer’s future development of the brand may help to
expand the brand’s overall recognition and global revenue potential.
The Company owns a diversified portfolio of over 35 iconic brands across women’s,
men’s, home and entertainment. The Company’s objective is to grow
its existing portfolio organically, both domestically and internationally, and
acquire new brands, both of which leverages its brand management expertise,
platform and infrastructure, and where third parties offer similar leverage
of their relationships and infrastructures, enter into joint ventures or other
partnerships. To achieve this objective, the Company intends to:
extend its existing brands by adding additional product categories, expanding
the brands’ distribution and retail presence and optimizing its licensees’
sales through marketing that increases consumer awareness and loyalty;
continue its international expansion through additional licenses, partnerships,
joint ventures and other arrangements with leading retailers and wholesalers
worldwide;
continue acquiring consumer brands or the rights to such brands with high consumer
awareness, broad appeal, applicability to a range of product categories and
an ability to diversify the Company’s portfolio; and
use advertising and marketing to keep brands relevant and create long term value.
In managing its brands, the Company seeks to capitalize on its heritage and
authenticity, while simultaneously working to keep its brands relevant to today’s
consumer.
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