Kenneth Cole Productions Inc reported financial results for the third quarter ended September 30, 2007. The Company reported third quarter net revenues of $130.3 million and earnings per fully-diluted share of $0.17, both in-line with its most recent guidance.
Licensing revenue continued to grow, with a third quarter increase of 7.5% to $11.6 million versus $10.8 million in the same quarter of the prior year. Comparable store sales continued to improve versus prior periods and were approximately flat in the third quarter. Company Outlet Stores posted their fourth consecutive quarter of positive comparable store sales.
Due to a lower store count, however, the Company's overall Consumer Direct revenues decreased 3.6% in the third quarter to $39.9 million. Wholesale revenues were affected by the general weakness in the apparel and footwear market and were $78.8 million, down 13.9% versus the prior year's level of $91.5 million.
The Company's third quarter gross margin remained strong, rising 100 basis points to 44.4%, versus the year-ago level of 43.4%. SG&A, as a percentage of revenues, increased to 41.3% due to costs associated with stock-based compensation, professional fees, the loss of leverage associated with the revenue decline, and start-up expenses for the development and production of our men's sportswear line.
The Company noted that its debut men's sportswear line was well-received and has bookings slightly above plan for the Spring season.