Cherokee Group Sets 1st-Quarter Record

Cherokee Group, the high-flying North Hollywood apparel maker, said earnings rose 42% on 35% higher sales for its first quarter ended Feb. 28.

Cherokee, whose stock has risen sharply in the last year, also said it plans to sell 2.5 million more shares to the public, including 700,000 offered by three top executives.

First-quarter earnings were a record $2.5 million, against $1.7 million in the quarter last year. Earnings per share were 22 cents versus 16 cents, adjusted for a 2-for-1 stock split on Feb. 26. Sales were $37.0 million, up from $27.3 million a year ago.

The company said proceeds from its planned stock offering will be used for general purposes, including repaying debt, but that Cherokee has also begun to consider making one or more acquisitions.

The offering, which is being handled by First Boston Corp. and Shearson Lehman Brothers, is now awaiting approval from the Securities and Exchange Commission and should come to market in about 30 days, the company said.