Good day, ladies and gentlemen, and welcome to the Iconix Second Quarter Earnings Conference Call. At this time, all participants are in a listen-only mode. Later we will conduct a question-and-answer session and instructions will follow at that time. Now I'd like to read a brief Safe Harbor statement under the Private Securities Litigation Reform Act of 1995. The statements that are not historical facts contained in this conference call are forward-looking statements that involve a number of risks, uncertainties and other factors, all of which are difficult or impossible to predict and many of which are beyond the control of the company. This may cause actual results, performance or achievements of the company to be materially different from the results, performance or achievements expressed or implied by such forward-looking statements. The words believe, anticipate, expect, confident and similar expressions identify forward-looking statements. Listeners are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date the statement was made. I would now like to introduce your host for today's conference call, Mr. Peter Cuneo, Chairman of the Board and Interim Chief Executive Officer. You may begin.

Good morning, everyone, and welcome to the Iconix Brand Group's second quarter 2015 earnings conference call. I'd like to start today by introducing myself as well as other members of the Iconix senior management team who are here with me today. My name is Peter Cuneo. As you've heard, I am the Chairman and Interim CEO for Iconix. Also in the room, we have David Jones. David is our newly appointed EVP and Chief Financial Officer. David has joined Iconix with great proven experience as the CFO of a multi-billion dollar global public company. David has very strong technical, financial and strategic skills, and we are quite privileged to have him on our team. Also in the room today is David Blumberg. David is our Head of Strategic Development and he recently served as our Interim Chief Financial Officer. David, again, is a highly experienced executive. He's been with Iconix for many years and knows our business very well, and we greatly appreciated his stepping up in that interim role to support the company. David did an outstanding job. Also we have Willy Burkhardt, who is our Executive Vice President and Managing Director for International business, which is growing very rapidly. And finally, but not the least of people in the room, we have Jaime Sheinheit, who is our VP of Investor Relations. I know that a lot of you know her and although I've only been on the job for five days, including the weekend, I've come to appreciate Jaime's professionalism and energy very much. As we announced on Thursday, I have taken on the role of Chairman and Interim CEO for the company following Neil Cole's resignation. I want you to know that I plan to be an active interim CEO and I think that my past significant…

Thanks, Dave. Before we start Q&A I just want to again re-emphasize how optimistic we are about the company's future, and there are a number of reasons to this. The first certainly again goes back to our global brand portfolio. As mentioned, these are very, very strong brands in the world of intellectual property. Our strategy has been consistent and will I think overall be consistent in the future. We have a great global platform. As most of you know, our international business has grown very rapidly as a percent of our total business over the recent years. We have great partners, both retailers, wholesalers, and best-in-class international partners as well. We are going to continue to be opportunistic – I'm talking too much today. I'm dried out – in terms of acquisitions and share buybacks and I think we're very excited about the opportunity to look at our long-term value through various investments. I think most interesting is the fact that if there is any changes in our statements, there would be no material change to our free cash flow projections, both historical and in the future. So thanks very much for your time and the floor is now open to questions.

Our first question comes from Steve Marotta with C.L. King & Associates. Steven L. Marotta - C.L. King & Associates, Inc.: Good morning, everybody. I have a couple of questions. The first is when do you expect a resolution to the SEC inquiry roughly? I know that there's no way to give a specific projection there, but is there a rough estimate as to when this could draw a conclusion? David K. Jones - Chief Financial Officer & Executive Vice President: Steve, hi. It's Dave Jones. Obviously that's a difficult question. We're in a comment letter process with the SEC staff. Determining when that's going to conclude is difficult. The details of each transaction are disclosed in our filings. Obviously the auditors have reviewed and/or audited those. We do generally believe our position is correct. We've presented all of our views to the staff; we've given them what we think is the appropriate supporting literature, and I think that's really all we can say about it at this point. Steven L. Marotta - C.L. King & Associates, Inc.: Okay. As it pertains specifically to the reduction and expectations for entertainment revenue in fiscal 2015, is this simply timing or have you lowered your expectations on what the Peanuts movie will generate and the concurrent merchandising associated with the movie?

Hi, Steve. This is Peter. It's very common for studios to alter the timing of when they will introduce a film into a particular area of the world, and this is always changing a little bit because the studios want to basically take advantage of best possible for local conditions. China would be a particular interesting situation as well in this case because the potential for revenue out of China is quite great. So these are always moving around a little bit and what we have gotten from Fox in the past may change a little bit, and so we have to change our revenue expectations, in this case, slightly downward. However, our overall feeling for this project and for the film continues to be very bright, and if anything we're, in our minds, just moving a little bit of revenue out of 2015 into 2016. Steven L. Marotta - C.L. King & Associates, Inc.: That's very helpful. Can you talk about the primary delta in free cash flow expectations in fiscal 2015 from what it was previously in the $208 million to $218 million range to where it is now at $170 million to $190 million? Is that largely related to the timing issues, Peter, that you just mentioned, or are there other factors?

Dave, do you want to answer? It's not primarily related to films. David K. Jones - Chief Financial Officer & Executive Vice President: Yeah. No, in total, our new projection of $410 million to $425 million – as we have an, obviously, a new CEO and a new CFO taking a fresh look at it. We looked at 2014 results from the core business, and based on current trends, I think that the reset is appropriate. There's a challenging U.S. retail environment. U.S. men's business is tough. We hope to grow the base organically globally through continued expansion. The international business is growing swiftly, but mitigated a bit by the U.S. dollar in terms of FX and to Peter's point, timing of the Peanuts movie around the globe. In terms of Other revenue, we haven't assumed any consolidation of joint ventures in the back half, which was in our original assumptions. And so that certainly makes a difference. And just sticking with Other revenue, Steve, we're actively working on a couple of strategic opportunities. For example, JVs with best-in-class partners in the U.S. and globally, we believe we still have the opportunity to form one or more strategic partnerships in this year, and so our estimates of Other revenue of $5 million to $15 million we think is realistic. Steven L. Marotta - C.L. King & Associates, Inc.: Okay. Just one other question. The guidance for licensing revenue this year is $410 million to $425 million. Can you give what the actual was last year? And really what I'm asking there is, do you consider that ABC contract that was signed in the first quarter of last year to be licensing revenue or a one-time? David K. Jones - Chief Financial Officer & Executive Vice President: Yeah. The actual last year was $407 million and the $17 million is included in that $407 million. Steven L. Marotta - C.L. King & Associates, Inc.: Okay. Thank you.

Our next question comes from Eric Beder with Wunderlich.

Good morning. Hello?

Yeah. Good morning, Eric. David K. Jones - Chief Financial Officer & Executive Vice President: Good morning, Eric.

Okay. A housekeeping question. What is the debt level now in Q2? David K. Jones - Chief Financial Officer & Executive Vice President: I'm sorry, debt level? Yeah. In Q2, it's about $1.5 billion, Eric, and that would be, there's $100 million outstanding on the variable funding notes or the revolver. We've got about $743 million of securitization and then obviously the two convertible notes. One is about $350 million, the Other is about $286 million. The thing to remember is those accrete up as they mature. Ultimately, the face value is $400 million on the 1.5% notes and $300 million on the 2.5% notes. So the total is just shy of $1.5 billion.

And what was the revenue in Q2 from the acquisitions from Strawberry Shortcake and PONY? David M. Blumberg - EVP & Head of Strategic Development, Iconix Brand Group, Inc.: It's David Blumberg. We haven't broken out the revenue by acquisitions. We're pretty much on target with what we said originally.

When you look at the portfolio, you look at your debt coming due in the next two years. Would you consider or contemplate selling some of the brands? I know Neil was not really very high on diversifying or getting rid of any of the brands. What's your thought process on that?

Well, generally speaking – this is Peter. We're in the business to own brands and to monetize them. There are certain circumstances where the brands have no value in particular areas of the world and to the extent people approach us to sell the brands because they can do more with them than we can, we would consider that. But as a general rule, we are not interested in selling our brands.

Okay. And in terms of buying back the joint ventures, I understand that you are not putting that in your assumptions, but does it make economic sense and do you think it still makes sense to eventually consolidate most of the joint ventures like has been done under prior management? David M. Blumberg - EVP & Head of Strategic Development, Iconix Brand Group, Inc.: Hi, it's David. I think we're going to look at each joint venture, each geography, and decide how its growth with our partner is versus if we think they've built a base and we can build off of that business. So I don't think we can give a general overview. The goal would be at some point to have a global Iconix business that is owned by us, but I don't think we can pinpoint when would be the appropriate time to buy any of the joint ventures back. We feel very good about China and ILA, that whether it's a timing that they had built a good platform that we have good businesses there, we have good people and really we'll touch on it. There is more questions, but we're able to now grow off those platforms successfully. So again, it's, I think, joint venture by joint venture, geography by geography, but obviously the long term goal would be to have one Iconix, global Iconix, where we would have ownership of all those.

Great. Thank you and good luck.

The next question comes from Liz Pierce with Brean Capital.

Good morning and welcome to, I guess, Peter and to David. So Peter, I just wanted to verify, you said on the renewals, the direct, the DTRs that you have renewed OP and Candie's, but did you say anything about Starter, because I think that expires at the end of this year and Danskin at the end of next year? David M. Blumberg - EVP & Head of Strategic Development, Iconix Brand Group, Inc.: It's David, I'm sorry. Starter and Joe Boxer are at the end of this year, Bongo is the end of January.

Right. So where – I guess my question is, where are you in terms of renewals on those?

Well, they're obviously, Liz, under discussion, they're obviously important.

Okay.

So there's back and forth going on.

Okay. And just to circle back on the men's business and the Home business, clearly down a little bit more than I expected. What are the major pressure points that you're seeing? You would think with Home and what's happening with housing that that would be a catalyst for that business to grow. David M. Blumberg - EVP & Head of Strategic Development, Iconix Brand Group, Inc.: I think if we look at macro trends as well as micro, the Home brands of these Iconix brands that we think resonate well with the value propositions that the retailers have. So, JCPenney with our brands grow well, Walmart now with Waverly Inspirations, we think – I'm sorry, Royal Velvet at JCPenney, we think that this is the value proposition of the DTRs and the value propositions that we present where they can have national brands at private label economics. And so we're excited on the Home side. I can't really speak to the macro and I apologize about that, but obviously if there's a increase in Homes, it probably is rising tide lifts all. On the men's, I think that we've continued to see a challenge, as Peter said. We see international that these brands seem to have a really good lift almost across most of the geographies. Sports have a really good lift, which is part of the men's group as well on a global basis. And domestically, it's just finding, again, the right product, the right brand and the right value proposition.

And do you think in terms of – I mean the SG&A on a dollar basis was up considerably. So $2 million, that special charge, was in the $48 million. Is that correct? David K. Jones - Chief Financial Officer & Executive Vice President: That's correct.

So I mean I guess the other thought that I had is, is it a matter of you guys spending more on the marketing to kind of help get the men's business and the Home business back in more of a growth mode? David M. Blumberg - EVP & Head of Strategic Development, Iconix Brand Group, Inc.: I think it's a few things. I think one is, yes, we are spending more on the brands. I'll get to margin in a second. I think we're also agreed to take down our revenue estimates through the end of the year. But on a dollar basis, the other thing that's happening is, is Peanuts, because remember, we have talent fees that go to the family. We have a bigger cost structure that's associated with Peanuts, which as it's growing with the movie and growing as a percentage of the overall, would show more of the SG&A.

Got it. Got it. And then any update on -- with taking back China and your ability to monetize, how we should think about that as we think of through the end of this year and into next year?

Yeah, sure. This is Willy Burkhardt. Hi, Liz.

Hi.

So, yeah. So the transition is going quite well since we made the full acquisition back in March. We're actually moving to contract on our first two new licenses, one for Joe Boxer, another one for Badgley Mischka. We're seeing lots of interest and good opportunities for us to expand our overall licensing business. Meanwhile, the joint venture businesses that we've had for several years are actually sustaining solid growth despite some real economic headwinds in that country.

Great. And then just one last question: tax rate -- should we – like what do you – kind of tax go forward this year and where into next year? David K. Jones - Chief Financial Officer & Executive Vice President: Liz, it's Dave Jones. We're thinking about a tax rate of 34%, 35% for the rest of the year. Something to keep in – and that's kind of up from historical -- but something to keep in mind there as a lot of the larger gains that we had historically were at a lower tax rate because they were in the Luxco (40:41) entity. So it's really mix, and based on the current assumptions today, we're looking at 34% to 35%.

Great. Thank you. Best of luck, guys.

Thank you.

Our next question comes from Bob Drbul with Nomura.

Hi. Good morning. Just got a couple of questions, I guess the first one is, can you elaborate a little bit on Neil's decision to step down and the process around his departure? Just give us a little bit more color in terms of what led to it and what was the ultimate factor in terms of this move.

Well, Neil, as you know, resigned to pursue other business opportunities. There isn't really anything more in terms of detail that we can provide on that. That's really his decision and the company will move forward.

Got it. And can you just talk a little bit about the discussions with any of your major retailing partners around a lot of the management transition over the last several months? David M. Blumberg - EVP & Head of Strategic Development, Iconix Brand Group, Inc.: It's David. What I'd say is it's just more discussions about the brands. We have these tremendous iconic brands. We have long-term relationships with the big box retailers, and they're the ones who really are driving the growth there. We continue to have conversations with them, weekly basis with the merchants, with the senior management, and hope that they continue to feel the same way we do about the brands and more importantly the consumers feel about those brands inside the retailer stores.

Got it. And David, I guess one month into it, can you maybe give us your top one or two surprises so far? David K. Jones - Chief Financial Officer & Executive Vice President: Well, I think the top one is obvious, right.

Yeah. David K. Jones - Chief Financial Officer & Executive Vice President: But no. I'll tell you, it's been a good experience. I think the company and the discussions leading up to my arrival was very transparent, so I was familiar with the topics that the company was talking about with the SEC. As I said in my opening statements, I think the team here is great, both on the accounting and finance side and the business side. They're very, very passionate people. I was surprised that some of the tenured people have been around for a long time, and people want to be around for a long time and genuinely believe in the model. So I think the company is still growing and I'm hopeful that I can add to the – building a world-class organization, in particular on the finance and accounting side, but I've been really happy with the team and I think we're all working very well together.

Great. And I just had one more question. So when you look at the balance sheet and I think the liquidity around the next 12 months in terms of – if the convert (43:51) that comes due, would you be able to maybe do a material-sized acquisition or should we wait, expect nothing until that maturity has been sort of addressed? David K. Jones - Chief Financial Officer & Executive Vice President: Bob, the balance sheet is really strong. As I mentioned we ended Q2 with $183 million of cash. About – a little over $100 million of that is in the U.S. We continue to expect -- continue to generate strong free cash flow and we're looking at all the options. We believe we have the ability to upsize our securitization if we had some additional brands, which we have. The cash flow on the securitized brands has been consistent, and I would say even more consistent, it's been stronger currently than it has been in the past. We don't have any covenant issues. Our ratios are in line and we're comfortable with them, and so I think we have access to capital markets and we'll continue to evaluate all of the opportunities that we have.

Great. Thank you very much.

We'll take one more question.

Okay. Our next question comes from Dave King with ROTH Capital Partners.

Hello, guys. This is Nick Meyers. I'll be on for Dave today. How are you guys doing?

Good, Nick. David K. Jones - Chief Financial Officer & Executive Vice President: Good, Nick.

All right. First on Peanuts, can you talk a little bit about the royalty rates both on box office sales and movie-related products? If we can remember correctly, I think your rates have typically been in the low to mid single-digit range, but from our understanding from entertainment property, sometimes they command a little bit higher rates. Is there anything you could help me on there? Thank you.

Well, I can draw on my experience in the past in the motion picture business and licensing, there's a very wide range in royalty rates depending on what particular category you're dealing with. As an example, if you're dealing with say confectionary, the royalty rates are very low because the margins for people in the confectionary business are very low and businesses where the margins are much greater, you're going to get a bigger royalty rate. So actually a very wide range, we have I believe it's now 1,500 licensees and they're all around the globe. So it's very hard to generalize about this particular area. The licensing rates generally whether they are movie or non-movie depending on the category tend to be roughly the same for that category. Hopefully that – is that helpful?

No. That helps. Thank you. And then – okay – so also on Peanuts, can you talk about the effects on – sorry, the contribution on full year guidance from Peanuts? How much is that embedded in box office versus the movie-related products? Is there any way you could comment on that?

Well, we hope that we've been very realistic in our forecasting for box office. If anything we're trying to be a little more conservative. As you might imagine Fox who was doing the film is reticent to give us or anyone, I think their internal forecasts on what they think the film will do, which makes perfect sense for an entertainment company, particularly one that's public. And I think that so we have to do kind of our own forecasting and we hope that we've been very realistic here.

Okay. Perfect. And then, all right, one more question and then I'll let you guys go. About China, what effect did your recent JV consolidation have on the full year guidance? And also, do you guys have any thoughts these days on China in general, both from a macro perspective and a stock market perspective? David M. Blumberg - EVP & Head of Strategic Development, Iconix Brand Group, Inc.: So let me take the first question and then I might have to ask you to ask the second one. So in terms of consolidation for the full year, since our business model previously had been not a licensing-based strategy, the consolidation really does not lead to very much of an impact for this year. Certainly as we go forward, we're expecting licensing royalty out of China to grow and to grow significantly, but not in terms of this year based on the consolidation back in March. And I'm sorry, your second question? Could you repeat that again?

Oh, yeah. Just thoughts on China in general, both from a macro perspective and a stock market perspective and maybe whether that has any effect on your strategy towards monetizing your stake in Candie's in China? David M. Blumberg - EVP & Head of Strategic Development, Iconix Brand Group, Inc.: Yeah. Let me take the last question first because...

Sorry. David M. Blumberg - EVP & Head of Strategic Development, Iconix Brand Group, Inc.: (48:39) expert to opine on for the market conditions and the stock market in China. But as it relates to our monetization, as I mentioned earlier following Liz's question, our businesses right now that we had formed in joint ventures, Candie's, Material Girl, et cetera, are actually performing quite well. And so, we're actually not – and I think we said this in the last conference call as well, last quarter – we're not actually anticipating a monetization of that on those existing joint ventures this year. We're continuing to monitor performance, certainly the stock market performance will affect that as well, but we are not seeing anything in 2015.

All right. Perfect. That helps a lot. All right, guys. Thank you very much and good luck.

Thank you all very much for your questions. We appreciate it. Again, we remain very optimistic about this business. The management team here is free to talk to anyone who would like to talk to us about the business. There are a lot of moving parts here, as you know, but once again we think we're very much excited about the future and what's going on. I'll just mention again, as I have during this last time that we've been talking, I think we have a great brand portfolio of brands. I think we're resetting, at this point to focus on the long-term value creation for that portfolio. I think our strategy will be consistent in the future. We are global in nature, international is very strong and growing. We have great partners, as I mentioned, retailers, wholesalers, international partners. We can be opportunistic with acquisitions and share buybacks. So then – and again, our free cash flow continues to be in our estimation very strong. So thank you all again very much for your participation. Appreciate it, and have a good day. Thank you.