I.C. Isaacs Reports Strong Second Quarter 2004 Results

I.C. Isaacs Reports Strong Second Quarter 2004 Results
Net Sales Increase 27.7% in First Six Months of 2004 


NEW YORK, Aug. 3  /PRNewswire-FirstCall/ -- I.C. Isaacs & Company, Inc.
(OTC:ISAC.OB) (BULLETIN BOARD: ISAC.OB) , designer and marketer of the Marithe
& Francois Girbaud brand of casual denim and sportswear, today reported that
its net income increased to $1.3 million, or $0.11 per diluted share, for the
three months ended June 30, 2004, compared to $0.5 million, or $0.04 per
diluted share, for the three months ended June 30, 2003.  Earnings for the six
months ended June 30, 2004 were $2.2 million, or $0.18 per diluted share,
compared to a net loss of $0.2 million, or ($0.02) per diluted share, in the
same period of 2003.

"We are extremely pleased with our overall performance in the first six months
of the year.  We are continuing to make significant progress on raising the
visibility and expanding the Girbaud brand into new markets.  Growth in the
quarter was driven by double digit increases in net sales of both Men's and
Women's Girbaud products and positive sell-throughs at retail," said Peter
Rizzo, Chairman and CEO, I.C. Isaacs.  "Furthermore, we are modifying our men's
and women's assortments with more signature Marithe & Francois Girbaud styling,
minimizing logos and reducing the size of graphics to enable us to appeal to
the ever changing taste of our youth audience.  Finally, we are continuing to
selectively exit from less profitable doors to improve the underlying health of
our business."

Results for the Second Quarter 2004

Net income increased to $1.3 million, or $0.11 per diluted share, for the three
months ended June 30, 2004, compared to $0.5 million, or $0.04 per diluted
share, for the three months ended June 30, 2003.

Net sales increased 24.7% to $20.2 million in the second quarter of 2004 from
$16.2 million in the second quarter of 2003.  Gross profit increased 40.4% to
$8.0 million in the second quarter of 2004 from $5.7 million in the second
quarter of 2003.

Gross profit margins increased to 39.6% in the second quarter of 2004 from
35.2% in the second quarter of 2003. Higher gross profit and gross profit
margins were due to better product performance and improved delivery to
retailers.

Operating expenses increased 30.0% to $6.5 million in the second quarter of
2004 from $5.0 million in the second quarter of 2003.  The increase in
operating expenses resulted primarily from higher selling expenses and
licensing fees associated with higher sales as well as an increase in
administrative expenses.

Six Months 2004 Results

Net income increased to $2.2 million, or $0.18 per diluted share, for the six
months ended June 30, 2004, compared to a net loss of $0.2 million, or ($0.02)
per diluted share, in the same period of 2003.

Net sales grew 27.7% to $41.9 million for the first half of 2004, from $32.8
million in the same period of 2003.

Gross profit increased 55.8% to $16.2 million in the first half of 2004 from
$10.4 million in the same period of 2003. Gross profit margins increased to
38.7% in the first half of 2004 from 31.7% in the same period of 2003.

Operating expenses increased 33.3% to $13.6 million in the first half of 2004
from $10.2 million in the same period of 2003.  The increase in operating
expenses resulted primarily from higher selling expenses and licensing fees
associated with higher sales as well as an increase in administrative expenses.

The Company continues to experience a significant increase in order backlog,
$37.4 million at June 30, 2004, an increase of 199.2% compared to $12.5 million
at June 30, 2003.  The increase is partially the result of the sales force
receiving and processing its orders earlier.

About I.C. Isaacs & Company

I.C. Isaacs & Company, Inc. is a designer and marketer of branded casual denim
and sportswear based in New York and Baltimore.  The Company offers full lines
of casual denim and sportswear for men and women under the Marithe & Francois
Girbaud brand in the United States and Puerto Rico.

This announcement contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. Those statements include
statements regarding the intent, belief, or current expectations of I.C. Isaacs
and its management with respect to expenses and expected financial results of
the Company for the year 2004, including without limitation statements
regarding the Company's expectations with respect to the economic environment
in 2004 and belief in the strength and future of the Girbaud brand. Such
statements are subject to a variety of risk and uncertainties, many of which
are beyond the Company's control, which may cause actual results to differ
materially from those contemplated in such forward-looking statements,
including in particular, the risks and uncertainties described under "Risk
Factors" in the Company's Prospectus, which include, among other things, (i)
changes in the marketplace for the Company's products, including customers'
taste, (ii) the introduction of new products or pricing changes by the
Company's competitors, (iii) changes in the economy, (iv) termination of one or
more of its agreements for the use of the Girbaud brand names and images, and
(v) the risk that the Company's sales estimate will differ from actual orders
and the Company will order too much or too little inventory. Existing and
prospective investors are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date hereof. The Company
undertakes no obligation to update or revise the information contained in this
press release, whether as a result of new information, future events or
circumstances or otherwise.

                       I.C. Isaacs & Company, Inc.
            Consolidated Statements of Operations (Unaudited)
                  (000's omitted except per share data)

                           Three Months Ended         Six Months Ended
                                June 30,                  June 30,
                           2004         2003         2004         2003

  Net sales              $20,217      $16,230      $41,935      $32,774
  Cost of sales           12,211       10,534       25,730       22,407

  Gross profit             8,006        5,696       16,205       10,367

  Operating Expenses
    Selling                2,715        2,282        6,298        4,740
    License fees           1,298          925        2,651        1,853
    Distribution and
     shipping                484          475          987        1,071
    General and
     administrative        1,981        1,355        3,679        2,512

  Total operating
   expenses                6,478        5,037       13,615       10,176

  Operating income         1,528          659        2,590          191

  Other income (expense)
    Interest, net of
     interest income        (192)        (238)        (391)        (467)
    Other, net                23           50           24          106

  Total other income
   (expense)                (169)        (188)        (367)        (361)

  Income (loss) before
   income taxes            1,359          471        2,223         (170)
  Income tax expense          46            -           46            -
  Net income (loss)       $1,313         $471       $2,177        $(170)

  Basic income
   (loss) per share        $0.12        $0.04        $0.20       $(0.02)
  Basic weighted average
   shares outstanding     11,135       11,135       11,135       11,135
  Diluted income (loss)
   per share               $0.11        $0.04        $0.18       $(0.02)
  Diluted weighted average
   shares outstanding     12,280       11,145       12,280       11,135


                       I.C. Isaacs & Company, Inc.
                       Consolidated Balance Sheets
                  (000's omitted except per share data)


                                                    June 30,    December 31,
                                                      2004           2003
                                                  (Unaudited)
  Assets
  Current
    Cash, including temporary investments of
     $138 and $168                                    $878           $783
    Accounts receivable, less allowance for
     doubtful accounts of $416 and $275             12,236          9,871
    Inventories                                      4,641          3,855
    Prepaid expenses and other                         320             68

      Total current assets                          18,075         14,577
  Property, plant and equipment, at cost, less
   accumulated depreciation and amortization           677            777
  Other assets                                       4,871          4,736
                                                   $23,623        $20,090
  Liabilities And Stockholders' Equity
  Current
    Checks issued against future deposits             $609           $198
    Revolving line of credit                         3,406          4,224
    Current maturities of long-term debt             2,688          2,014
    Accounts payable                                 1,366          1,040
    Accrued expenses and other current
     liabilities                                     3,959          2,523

      Total current liabilities                     12,028          9,999

  Long-term debt                                     3,870          4,544
  Commitments and Contingencies

  Stockholders' Equity
    Preferred stock; $.0001 par value; 5,000 shares
     authorized, none outstanding                        -              -
    Common stock; $.0001 par value; 50,000 shares
     authorized, 12,311 shares issued;
     11,135 shares outstanding                           1              1
    Additional paid-in capital                      43,659         43,659
    Accumulated deficit                            (33,612)       (35,790)
    Treasury stock, at cost (1,177 shares)          (2,323)        (2,323)
      Total stockholders' equity                     7,725          5,547

                                                   $23,623        $20,090


DATASOURCE: I.C. Isaacs & Company, Inc.



CONTACT:  Robert J. Conologue, I. C. Isaacs & Company, Inc.,

[phone]

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