Replies to post #2416 on Triumph Apparel Corporation (TRUA)

[an old investor]

The way I see it, you guys have been differing over 2 SEPERATE statements. One 15 mil is an ADDITIONAL contingent payment to Danskin from Iconix if certain conditions are met. The other 15 mil mentioned is what Iconix believes Danskin's name will be worth to them the first year. (At least that is how I read it with the word 'additional' in the same sentence as the statement of the purchase price.)

In either case, what's 15 mil between friends...LOL

[jtomm]

The PR says the exact same thing as the conference call did. I don't find it confusing at all.

-The only one receiving royalty revenue in this deal is Iconix. DANS will have to pay a licensing fee to Iconix.

-Royalties and revenues are far from the same thing, as far as Danskin is concerned.

If there's any confusion you can go back and look at Iconix itself. Back in 2003 it was a floundering clothing manufacturer, much like Danskin. Had tons of revenue, but very little profit. They made the decision to become a brand management company. They ceased all their manufacturing operations, because that's a hard, terrible business with exremely low profit margins. And they went into the licensing business, which is a great business with huge margins. Iconix had huge revenues as a manufacturer, but very little profit. As a royalty company, Iconix's revenues plummeted but their profits skyrocketed.

-We have no idea what liabilites, or how much, were taken over by Iconix. Nor do we have any idea as to what liabilities are left with DANS. They may have run up huge debt in the last 5 years. They could easily end any speculation by posting audited financials but they refuse to do so. Iconix bought the most valuable asset -- the brand.

-DANS could be making $60m in rev, or $100m or $500m it still doesn't mean they might not go broke because very little of that makes its way to the bottom line. Iconix was in a very similar situation back in 2003. But Iconix decided to get out of the "high-revenue, low-or-no-profit" business, and get into the "much-lower-revenue, high-profit" royalty business.