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Net Sales Increase 11% to a Record $706 Million EPS Increases 25% to a Record $1.15 Provides Third Quarter Guidance and Increases Full Year Guidance
RICHARDSON, Texas, Aug. 6, 2013 (GLOBE NEWSWIRE) -- Fossil Group, Inc. (Nasdaq:FOSL) (the "Company") today reported its financial results for the second quarter and six month period ended June 29, 2013.
Second Quarter Operating Highlights
Net sales grew in all segments, compared to the prior year second quarter:
North America wholesale net sales increased 4%
Europe wholesale net sales increased 16%
Asia Pacific wholesale net sales increased 14%
Direct to consumer net sales increased 16% with flat global retail comps
Operating income increased 21%
The Company reported record net earnings of $67.7 million for the second quarter of 2013, compared to $57.3 million for the second quarter of 2012. Diluted earnings per share grew 25% to a record $1.15, compared to $0.92 for the prior year's second quarter. The Company's second quarter results benefitted from a shift of about $7 million (or $0.08 per share) of marketing and systems related expenditures into the third quarter. Additionally, compared to prior expectations, second quarter results were negatively impacted by $0.03 per share as the Company now expects a higher full year effective income tax rate, given an earnings mix shift among its operating entities.
Kosta Kartsotis, Chief Executive Officer stated: "We are pleased to continue our positive momentum and report record second quarter results that surpassed both our revenue and earnings expectations. During the quarter we advanced each of our core growth initiatives with strength in our FOSSIL® and SKAGEN® brands and double-digit sales increases in our multi-brand watch portfolio and in jewelry. We continued to leverage the power of our brands and our distribution infrastructure to expand our international footprint, fueling robust revenue increases in both Europe and Asia. Our team made substantial progress on many key operational initiatives that drove significant gross margin expansion in the quarter. Our consistent positive performance continues to reflect the innovation in our watch and jewelry lines, the disciplined execution of our strategies by our team and our ability to capitalize on the inherent strength of our dynamic global operating model."