Fossil Group, Inc. Reports Third Quarter 2020 Financial Results

About this update from Fossil Group, Inc.

[{"type":"text","content":"RICHARDSON, Texas, Nov. 11, 2020 (GLOBE NEWSWIRE) -- Fossil Group, Inc. (NASDAQ: FOSL) today announced financial results for the third quarter ended October 3, 2020.\n Third Quarter Summary Worldwide net sales of $435 million decreased 19% on a reported basis and 20% in constant currency. Topline performance was better than expected, due to continued strength in both owned and third party e-commerce, strong growth in Mainland China and modest improvement within the wholesale channel globally. On a constant currency basis, sales from the Company's owned e-commerce websites increased 66% and third party marketplace e-commerce sales increased 44% compared to prior year. Gross margin of 52.8%, representing 120 basis points of expansion compared to the third quarter of 2019. The Company reduced operating expenses by $75 million, or 26%, on a year-over-year basis, reflecting continued progress under its New World Fossil 2.0 - Transform to Grow program (“NWF 2.0”). Operating income of $18 million compared to an operating loss of $9 million a year ago, primarily reflecting gross margin and cost reduction benefits. Cash and cash equivalents of $324 million, and total debt of $239 million as of October 3, 2020. “The organization continues to execute well in the face of a challenging environment,” stated Kosta Kartsotis, Chairman and CEO. “We outperformed our topline expectations in the third quarter, reflecting ongoing momentum in our digital channels and strong growth in mainland China, as well as trend improvement in the wholesale channel globally.” “In addition, we are making good progress on our strategic priorities, with accelerated initiatives around our digital expansion programs and structural cost reduction efforts. Given the uncertain environment, we are remaining agile and continuing to closely manage liquidity, expenses and inventory as we position the business for future growth.” Third Quarter 2020 Operating Results Worldwide net sales totaled $435.5 million, a decrease of 19% on a reported basis and 20% in constant currency compared to $539.5 million in the third quarter of fiscal 2019. The year-over-year decline was primarily due to COVID-19 related traffic declines in both Fossil stores and wholesale doors. Partly offsetting brick-and-mortar sales declines was growth in digital channels, with owned e-commerce websites incr...

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