Cherokee Q1 Earnings Top Views, Shares Rise

Shares of Cherokee Inc CHKE jumped over 3 percent in after-hours trading after the company reported better-than-expected earnings for the first quarter on Thursday. The Sherman Oaks, California-based company posted a quarterly profit of $3.6 million, or $0.41 per share, versus $3.6 million, or $0.43 per share, in the year-ago period. Its revenue rose around 3 percent year-over-year to $10.2 million from $10.0 million. However, analysts were expecting earnings of $0.36 per share on revenue of $10.04 million. Operating income climbed 12 percent year-over-year to $5.8 million in the quarter, while operating margin widened to 57 percent from 52 percent. SG&A expenses declined 7.4 percent year-over-year to $4.4 million in the quarter. At May 2, 2015, Cherokee had $8.9 million in cash and cash equivalents, versus $7.6 million as of January 31, 2015. "Cherokee Global Brands continues to experience strong growth as we develop our current brands and welcome new, exciting brands into our portfolio," said Henry Stupp, Chief Executive Officer. "While the first quarter posed some challenges relating to the residual impact of the Los Angeles port closures, the end of our partnership with Tesco in the UK and Target Canada closing its doors – we have exited the quarter stronger than before. We recently entered into new retail partnerships with Sears Canada, Argos, and Sports Direct while also welcoming lifestyle brand Everyday California® into our portfolio." Cherokee shares surged 3.86 percent to $24.50 in the after-hours trading session.