MOSS Mossimo

Mossimo, Inc. (NASDAQ: MOSS) today announced financial results for the second quarter ended June 30, 2005. Mossimo, Inc. reported second quarter 2005 total net revenues increased to $9.0 million compared to $6.2 million for the same period last year. The Company reported second quarter net earnings of $2.2 million compared to net earnings of $1.0 million for the same period last year, and diluted earnings per share of $0.14 compared to diluted earnings per share of $0.06 for the same period last year. Net revenues for the six months ended June 30, 2005 were $17.7 million compared to $12.4 million in the same period last year. The company reported net earnings for the first six months of 2005 of $4.0 million compare to net earnings of $2.2 million in the corresponding period a year ago, and diluted earnings per share of $0.26 compared to diluted earnings per share of $0.14 for the same period last year. Edwin Lewis, President and Co-Chief Executive Officer stated, "Our second quarter results were driven by the growth of the Mossimo brand at Target, in particular, our women's black label and red label, women's shoes, men's wovens and bottoms all performed well. At the same time, revenues at Zellers were flat year-over-year as we continue to experience merchandising issues in the Canadian marketplace. With regard to Modern Amusement, our margins were impacted by higher off price sales and the write down of slower moving inventory." To listen to the Mossimo prerecorded second quarter fiscal 2005 earnings call, please dial (719) 457-0820 or (888) 203-1112, followed by the conference identification number #7542446. This call will be available beginning today, August 11, 2005 at 4:00 pm ET and run through August 18, 2005 at 11:59 pm ET. Founded in 1987, Mossimo, Inc. is a designer, licensor and distributor of men's, women's, boy's and girl's apparel, footwear, and other fashion accessories such as jewelry, watches, handbags, and belts. The matters discussed in this news release with respect to operations and future results, and the benefits thereof, are forward-looking statements that involve risks and uncertainties, including the demand for the Company's products in Target and Hudson's Bay Company/Zellers stores which have not traditionally sold the Company's products, changes in consumer demands and preferences, shifting trends in the overall retail and apparel market, competition from other lines, changes in consumer spending patterns and general economic conditions, and uncertainties generally associated with product introductions and apparel retailing. Forward-looking statements are not guarantees and involve known and unknown risks and uncertainties, any of which could cause actual results to vary materially from anticipated results. Operating results stated herein are not necessarily indicative of results that may be expected in future periods. More information on risk factors, which could affect the Company's financial results, is included in the Company's Forms 10-K and 10Q, periodically filed with the S.E.C. -0- *T MOSSIMO, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (IN THOUSANDS) (Unaudited) June 30, December 31, ------------ ------------ 2005 2004 ------------ ------------ ASSETS CURRENT ASSETS: Cash and cash equivalents $14,688 $4,903 Restricted cash 717 413 Investments - 4,800 Accounts receivable 6,448 2,908 Merchandise inventory 785 539 Deferred income taxes 2,376 1,739 Prepaid expenses and other current assets 375 436 ------------ ------------ Total current assets 25,389 15,738 PROPERTY AND EQUIPMENT, at cost, net of accumulated depreciation and amortization 985 1,117 DEFERRED INCOME TAXES 3,144 5,646 GOODWILL 212 212 TRADENAME, net 95 112 OTHER ASSETS 52 96 ------------ ------------ $29,877 $22,921 ============ ============ LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Accounts payable $1,113 $352 Accrued liabilities 307 257 Accrued commissions 778 258 Accrued bonuses 1,780 206 ------------ ------------ Total current liabilities 3,978 1,073 DEFERRED RENT 137 135 ------------ ------------ Total liabilities 4,115 1,208 COMMITMENTS, CONTINGENCIES, AND SUBSEQUENT EVENTS STOCKHOLDERS' EQUITY: Preferred stock, par value $.001; authorized shares 3,000,000; no shares issued or outstanding - - Common stock, par value $.001; authorized shares 30,000,000; issued and outstanding 15,738,442 at June 30, 2005 and December 31, 2004 15 15 Additional paid-in capital 39,763 39,763 Accumulated deficit (14,016) (18,065) ------------ ------------ Net stockholders' equity 25,762 21,713 ------------ ------------ $29,877 $22,921 ============ ============ MOSSIMO, INC. CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (IN THOUSANDS, EXCEPT PER SHARE DATA) (Unaudited) For the Three Months For the Six Months June 30, June 30, -------------------- -------------------- 2005 2004 2005 2004 --------- --------- --------- --------- Revenue from license royalties and design service fees $8,113 $5,784 $15,467 $11,994 Product sales 932 424 2,242 450 --------- --------- --------- --------- Total revenues 9,045 6,208 17,709 12,444 Operating expenses: Cost of product sales 695 211 1,734 224 Selling, general and administrative 5,353 4,330 9,928 8,543 --------- --------- --------- --------- Total operating expenses 6,048 4,541 11,662 8,767 --------- --------- --------- --------- Earnings from operations 2,997 1,667 6,047 3,677 Other income - Interest income 79 20 110 47 --------- --------- --------- --------- Earnings before income taxes 3,076 1,687 6,157 3,724 Income taxes 848 680 2,108 1,527 --------- --------- --------- --------- Net earnings $2,228 $1,007 $4,049 $2,197 ========= ========= ========= ========= Earnings per common share: Basic $0.14 $0.06 $0.26 $0.14 ========= ========= ========= ========= Diluted $0.14 $0.06 $0.26 $0.14 ========= ========= ========= ========= Weighted average common shares outstanding: Basic 15,738 15,738 15,738 15,738 ========= ========= ========= ========= Diluted 15,768 15,768 15,762 15,770 ========= ========= ========= ========= *T