Fossil’s Q2 Report On Track With Expectations; Innovations Planned For Year End
Fossil Group, Inc. (PPAI 196495, S8) has reported its financial results for its second quarter 2019, which ended June 29. The Richardson, Texas-headquartered supplier reported sales down from the same quarter in 2018, although this performance was in line with the company’s expectations.
Fossil registered second quarter net sales of $501 million in the quarter, down $75.2 million or 13 percent and $61.2 million in constant currency (an 11 percent decline) compared to the second quarter of fiscal 2018. The supplier reports that watches declined in the Americas and Europe and increased in Asia. Geographically, sales declines in the U.S. drove the decrease in the Americas. In Europe, on a constant currency basis, sales across the Eurozone declined in most major markets with the greatest declines in the U.K., distributor markets in Eastern Europe and the Middle East and Germany, while sales in Italy increased modestly. In Asia, sales growth was led by China and India.
“We delivered second quarter sales and earnings in line with our expectations,” says Kosta Kartsotis, chairman and CEO. “While sales declined in the quarter, our sales performance improved sequentially from the first quarter across all three regions. Growth in Asia accelerated, with continued strength in China and India as Emporio Armani maintained its strong momentum and the FOSSIL brand grew solidly. In addition, our global e-commerce sales were positive and FOSSIL delivered growth with its connected offerings. While we are experiencing ongoing disruptions in our category, we continue to make progress on our strategic priorities which support our long-term goal of delivering sales growth and improved profitability.”
Kartsotis adds, “As we look to the back half of the year, we have exciting new innovations coming to market across our traditional and connected product categories. Our focus on innovation along with our strong brand portfolio and powerful operating platform will enable us to deliver on our objective of long-term profitable growth. We continue to make progress on our New World Fossil 2.0 - Transform to Grow initiative to create more efficiencies across the company. These additional efficiencies, combined with our strong free cash flow conversion capability, will enable us to reinvest in more innovation and growth driving digital activities."