Fossil Group, Inc. · NASDAQ:FOSL
Fossil — Investor Presentation (January 2009)
36 slides from Fossil's investor presentation, Jan 12, 2009
Slide 1: [LOGO]
[LOGO]
Slide 2: Company Highlights
Company Highlights • Global accessory leader • Compelling brands with worldwide appeal • High-margin businesses • Proprietary brand strength • Significant opportunities for growth • Growing and profitable retail segment • Consistent track record of growth • Strong balance sheet and cash flow
Slide 3: Historical Net Sales Growth
2003 2004 2005 2006 2007 Net Sales Growth ($ in Millions) $1,214 $1,433 $1,043 $957 $781 Historical Growth Net Sales 22.5% 16.4% 18.0% 9.0%
Slide 4: Global Diversity
Global Diversity International 54% US 46%
Slide 5: Category Mix
Category Mix Watches Jewelry Leather Other Watches 67% Jewelry 8% Leather 18% Other 7%
Slide 6: Key Advantages in a Weak Economy
• Affordable and innovative offerings • Minimal seasonal obsolescence and short production cycles provide greater ability to control inventory and margins • Growth in new and under-penetrated geographies • Strong financial position Key Advantages in a Weak Economy
Slide 7: Strong Financial Position
• Healthy cash balances and strong cash flow model. • Increased capacity under US revolving line from $100 million to $140 million • No outstanding borrowings under US credit facility • Minimal other debt of approx $7 million Strong Financial Position
Slide 8: Design & Execution Core Strengths
DESIGN & EXECUTION Core Strengths
Slide 9: World Class Design
World Class Design Ae Sl
Slide 10: World Class Execution
World Class Execution
Slide 11: Our Business Model
FOSSIL DIRECT JEWELRY WATCHES ACCESSORIES Our Business Model
Slide 12: Growth Opportunities
Growth Opportunities • Fossil Brand • Direct Business • International Platform
Slide 13: Brand Repositioning
Brand Repositioning
Slide 14: Fossil Direct Stores - Web - Catalog
• Direct distribution for core businesses • Strong financial metrics • Excellent use of capital • Global footprint – early mover advantage • Accelerates global brand communication Fossil Direct Stores – Web - Catalog
Slide 15: Historical Store Growth by Concept
2004 2005 2006 2007 Proj 2008 Accessory Apparel Outlet Mulit-brand Fossil Retail Historical Store Growth by Concept 136 171 198 244 325 Total Doors
Slide 16: Global Accessory Stores
Global Accessory Stores Proj. 2008 North America 48% Europe 34% Asia 18%
Slide 17: Fossil Retail Accessory Stores
• Strong 4 wall metrics • High ROI • Positive Comps • Scalable Fossil Retail Accessory Stores Non-Watch 42% Watch 58%
Slide 18: Heidelberg, Germany
Heidelberg, Germany Opened 11/7/08
Slide 19: Paris, France
Paris, France Opened 11/14/08
Slide 20: Penang, Malaysia
Penang, Malaysia Opened 11/15/08
Slide 21: Hamburg, Germany
Hamburg, Germany Opened 11/21/08
Slide 22: Ecommerce - U.S.
700 Million Impressions 1.8 Million Visitors / Month 1 Million Opt-In Email Addresses $25 Million Annual Sales WWW.FOSSIL.COM Ecommerce – U.S.
Slide 23: Ecommerce - International
German Website Launch in Sept 2007 200K Visitors / Month $4 Million in Annual Sales Australia, UK & Singapore Sites in 2008 WWW.FOSSIL.DE Ecommerce – International
Slide 24: Catalog
Catalog 7.2 Million Annual Circulation and Growing 877K Name House File 7 Catalog Mailings in ‘08
Slide 25: Global Presence
Global Presence Fossil-owned Markets 3rd Party Distribution Partners
Slide 26: Sales Mix 2007
Sales Mix 2007 (in millions) $ % Mix Europe Wholesale $ 483.9 33.8% Other Int’l. Wholesale 233.2 16.2 Total Int’l. Wholesale 717.1 50.0 Domestic Wholesale 460.6 32.2 Direct to Consumer 255.3 17.8 Total $1,433.0 100.0%
Slide 27: Shop-in-Shop: London, UK
Shop-in-Shop: London, UK
Slide 28: Shop-in-Shop: Belfast, Northern Ireland
Shop-in-Shop: Belfast, Northern Ireland
Slide 29: Shop-in-Shop: Malaysia
Shop-in-Shop: Malaysia
Slide 30: Shop-in-Shop: Singapore
Shop-in-Shop: Singapore
Slide 31: Financial Summary
Financial Summary
Slide 32: Historical Net Sales Growth
2003 2004 2005 2006 2007 US Wholesale Intl Wholesale Direct Net Sales Growth ($ in Millions) $1,214 $1,433 $1,043 $957 $781 2004 2005 2006 2007 10 Year 19.5 19.1 19.4 19.3 5 Year 18.9 15.7 17.4 16.7 CAGR % Increase Over Prior Year 2004 2005 2006 2007 US Wholesale 13.2 7.9 7.5 4.0 Intl Wholesale 26.9
Slide 33: Gross Profit and Operating Income
$398 $503 $535 $609 $742 2003 2004 2005 2006 2007 $106 $131 $109 $123 $186 2003 2004 2005 2006 2007 Historical Growth Gross Profit and Operating Income Gross Profit ($ in Millions) Operating Income ($ in Millions) Gross Profit Margin % 2003 2004 2005 2006 2007 51.0 52.5 51.3 50.2 51.8 Operating Marg
Slide 34: Current Performance YTD Q3
Current Performance YTD Q3 Net Sales ($ in Millions) 15.4% Gross Profit ($ in Millions) Op Income ($ in Millions) 23.3% 42.0% YTD Q3 08 YTD Q3 07 Gross Margin Operating Margin 54.4% 13.2% 50.9% 10.7% Diluted EPS $1.33 $1.00 2007 $969.9 2008 $1,119.1 2007 $104.1 2008 $147.8 2007 $493.6 2008 $608.8
Slide 35: Selected Financial Information
($ in millions, except for per share data) Q3 2008 Q3 2007 FY 2007 FY 2006 Cash and cash equivalents 125 196 268 140 Accounts receivable - net 229 201 227 155 Inventories - net 332 266 248 228 Short-term debt 4 12 10 11 Stockholders’ equity 768 708 772 602 Cash flow from operations 132 148 Cash flow
Slide 36: Thanks for Stopping By
Thanks for Stopping By