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Diluted EPS Increases 25% to $1.58Maintains Full Year 2013 EPS Guidance and Provides Fourth Quarter Guidance
RICHARDSON, Texas, Nov. 5, 2013 (GLOBE NEWSWIRE) -- Fossil Group, Inc. (Nasdaq:FOSL) (the "Company") today reported its financial results for the third quarter and nine month period ended September 28, 2013.
Third Quarter Operating Highlights
Net sales grew in all business segments:
Wholesale net sales increased 19%, with growth in all wholesale segments, including the favorable effects of shipment timing shifts
Direct to consumer net sales increased 16%
Global retail comps declined 0.5%, with increases in Europe and Asia Pacific and a decrease in North America
Net sales increased in all major product categories including 20% growth in watches
Operating income increased 25% and operating margin expanded 90 basis points to 17.4%
The Company reported net income of $89.7 million for the third quarter of fiscal 2013, compared to $76.8 million for the third quarter of fiscal 2012. Diluted earnings per share grew 25% to $1.58, compared to $1.26 for the prior fiscal year's third quarter. The Company's third quarter fiscal 2013 results include about $20 million in sales related to shipments which the Company had previously expected to deliver in the fourth quarter. The Company also deferred about $5 million in anticipated third quarter expenses into the fourth quarter of fiscal 2013. The Company estimated that the combined favorable impact related to these items on the current quarter's net income and diluted earnings per share were about $11 million and $0.19, respectively.
Kosta Kartsotis, Chief Executive Officer, commented on the results. "We are very pleased with our third quarter results. We executed well and maintained the strong momentum that we carried out of the first half of the year. We grew our business and delivered solid earnings, reflecting the power of our business model, the strength of our innovation and the outstanding execution of our team. We achieved sales growth across geographies, product categories and brands, delivering double-digit increases in our FOSSIL
® and SKAGEN
® lifestyle brands as well as in our multi-brand watch portfolio. We continued to advance our operational initiatives and drive shareholder value, as we leveraged our strong financial position and cash flows, investing in long-term growth and executing on our $1 billion share repurchase program."
Mr. Kartsotis concluded, "As a global leader in a growing category, our goal is to capitalize on the strengths of our diversified business model to advance our key growth initiatives and deliver consistent and sustainable growth and profitability. Our talented team, world class supply chain and global infrastructure have fueled our successful track record of building and expanding powerful global lifestyle brands in the watch and accessories categories. The considerable opportunities we have around the world combined with our solid capital structure and strong cash flows, have us positioned to continue our growth, pursue new growth opportunities and deliver solid returns for our shareholders in the near and long term."