Cherokee Global Brands reported a profit during its third fiscal quarter despite lower revenues.
The Van Nuys fashion licensing company on Thursday reported net income of $63,000 (0 cents per share) for the quarter ended Nov. 3, compared to a loss of $2.5 million (-17 cents) for the same quarter last year. Revenue declined 25 percent to $5.8 million.
The company explained the revenue decline as reflective of the company’s Tony Hawk, Cherokee and the Liz Lange brands moving from a direct-to-retail model to a wholesale licensing partners. However, the company cut $3 million from its costs as part of a campaign to “rightsize” operations.
“Our more efficient structure is focused on maximizing the value we can deliver on brands we own, brands we create and brands we develop for new partners, which taps into the capabilities of our product design and development platform,” Chief Executive Henry Stupp said in a statement.
The company reported results after market close. Shares of Cherokee (CHKE) closed Thursday down 6 cents, or 8.7 percent, to 63 cents on the Nasdaq.