Business
Fossil Group, Inc. Reports First Quarter 2020 Financial Results and Provides COVID-19 Update
Reopening Stores in Phased Approach RICHARDSON, Texas, June 03, 2020 (GLOBE NEWSWIRE) -- Fossil Group, Inc. (NASDAQ: FOSL) today announced financial results
About this update from Fossil Group, Inc.
[{"type":"text","content":"Reopening Stores in Phased Approach\n RICHARDSON, Texas, June 03, 2020 (GLOBE NEWSWIRE) -- Fossil Group, Inc. (NASDAQ: FOSL) today announced financial results for the first quarter ended April 4, 2020 and provided an update on the Company's response to COVID-19. First Quarter Summary Worldwide net sales of $391 million decreased 16% on a reported basis and 15% in constant currency. Sales in the quarter were significantly impacted by COVID-19 on a global basis beginning in February in Asia.The Company’s New World Fossil 2.0 - Transform to Grow Program (\"NWF 2.0\") was expanded to address additional challenges posed by COVID-19. The Company's actions to improve its cost structure are expected to result in cost savings totaling $100 million in 2020 versus previously estimated cost savings of $50 million.Operating loss of $134 million compared to $20 million a year ago, primarily due to COVID-19 impacts on sales, gross margin and non-cash asset impairments.Cash and cash equivalents of $245 million and net debt totaling $74 million as of April 4, 2020. Kosta Kartsotis, Chairman and CEO, stated, “As people around the globe continue to face the many challenges presented by COVID-19, we are taking actions to mitigate the headwinds and chart our path forward amid a new operating environment. We are proud of our teams who have prioritized the health and safety of our communities while also moving quickly to protect our business, strengthen our financial position and accelerate our strategic priorities for 2020 and beyond.” COVID-19 Update In response to the COVID-19 crisis, the Company implemented measures to protect employee safety and well-being, including the previously announced store and office closings, which largely remain in place today. The Company also cut costs across the organization and enhanced its financial position through the following actions during the first quarter: Proactively drawing down $100 million of the Company’s $275 million credit facility;Reducing operating expenses across payroll, marketing, travel, professional fees and contract labor;Eliminating the majority of planned capital expenditures for 2020; andClosely managing working capital by reducing incoming inventory. As of April 4, 2020, the Company had total liquidity of $278 million, comprised of $245 million of cash and cash equivalents and $33 million ...