Kenneth Cole Productions Inc reported financial results for the second quarter ended June 30, 2007. The Company's second quarter net revenues were $118.9 million, a decrease of 12.1% versus the year ago level of $135.3 million.
The year ago period benefited, as the Company has previously noted, by approximately $7 million of first quarter orders that were shipped in the second quarter due to the start-up of a new distribution facility.
Excluding this $7.0 million, revenues would have decreased 7.3%. Gross margin percentage for the second quarter was up 240 basis points to 44.3%, versus the year ago level of 41.9%.
Operating income in the second quarter decreased to $3.8 million versus $8.1 million in last year's second quarter, in part, due to increased expenses for the in-house development of the men's sportswear business, the reduction in royalties and marketing contribution from our men's sportswear licensee and the shift in shipments noted above.
Second quarter earnings per fully-diluted share were $0.16 versus the year-ago second quarter earnings of $0.32 per share, and in line with guidance.
Comparable store sales declined less than 1%, which reflects continued improvement from prior periods. Consumer Direct revenues for the second quarter were flat compared to the prior year at $41.2 million, while inventory receipts were down more than 15%.
Licensing revenue for the second quarter increased by 2.2% to $10.6 million versus $10.4 million in the same quarter of the prior year. Wholesale revenues for the second quarter were $67.1 million, down 19.8% versus the prior year's level of $83.7 million.
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