Skullcandy filed its S-1 form on Friday to become a public company. The move was likely overshadowed by LinkedIn’s own decision to file its IPO, but nonetheless the headphone manufacturer will raise up to $125 million in an initial public offering.
Of course, the best part of an initial public offering is always sifting through a company’s formerly confidential information. According to its S-1 form, Skullcandy admits there are risks associated with its business, such as:
- “If we are unable to maintain and expand our network of sponsored athletes, DJs, musicians and artists, our ability to market and sell our products may be harmed”
- “Our manufacturing is concentrated with two key manufacturers, and if our relationship with either or both of them terminates or is otherwise impaired, we would likely experienced increase costs, disruptions in the manufacture and shipment of our products and a material loss of net sales.” Skullcandy also revealed it has no long-term contracts with any of its manufacturers.
The company noted its net sales increased 35.7 percent to $95.9 million “for the nine months end[ing] September 30, 2010” and net income with it 37.3 percent, to $7.6 million. So who will benefit the most from this IPO? 38 year old board chairman Jeff Kearl is Skullcandy’s largest investor, retaining 568,214 shares of the company’s stock.