Fossil Group, Inc. · NASDAQ:FOSL
Fossil — ICR XChange 2014
27 slides from Fossil's conference presentation, Jan 13, 2014
Slide 1: ICR XChange – January 13, 2014
ICR XCHANGE – JANUARY 13, 2014
Slide 2: Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 Certain statements contained herein that are not historical facts constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 and involve a number of risks and unce
Slide 3: Compelling Investment Opportunity
COMPELLING INVESTMENT OPPORTUNITY 1. GLOBAL GROWTH COMPANY 2. DIVERSIFIED BUSINESS MODEL 3. OPPORTUNITIES FOR LEVERAGE
Slide 4: Fossil Group
FOSSIL GROUP US THE SKAGEN PORTFOLIO oD FE NM AR K FOSSIL GROUP
Slide 5: Fossil
FOSSIL
Slide 6: Fossil Group
FOSSIL GROUP
Slide 7: Brand portfolio
@) TORY BURCH BURBERRY EZODIAC SWISS MADE 1882 RELIC wha adidas MICHAEL KORS EMPORIO™ARMANI DKNY © MICHELE FOSSIL GROUP MARC BY MARC JACOBS DIESEL LAGERFELD AX ARMANI EXCHANGE a.
Slide 8: Strategic Growth Drivers
STRATEGIC GROWTH DRIVERS • LARGE GROWING CATEGORY • COMPETITIVE ADVANTAGES • RISE OF LIFESTYLE BRANDS
Slide 9: Global Watch Industry Growth
GLOBAL WATCH INDUSTRY GROWTH • Watch market continues to outpace GDP growth • Fossil Group consolidated growth 2008-2013: 15.7% CAGR Source: Euromonitor International 2013 (watch market values reflect year-over-year exchange rates and current prices) Global watch market represented at retail in bill
Slide 10: Competitive Advantages
COMPETITIVE ADVANTAGES • MANUFACTURING AND SOURCING • DESIGN AND CREATIVITY • GLOBAL SUPPORT STRUCTURE • GLOBAL MANAGEMENT • GLOBAL DISTRIBUTION
Slide 11: Rise of Lifestyle Brands
RISE OF LIFESTYLE BRANDS Global Watch Market Share Gainers & Losers (Share Gain/Loss 2008 - 2012 for watches < $1,000) Traditional Watch Companies -1.5% -1.0% -0.5% 0 +0.5% +1.0% +1.5% +2.0% +2.5% +3.0% +3.5% Source: Euromonitor International 2013
Slide 12: Creating Shareholder Value
CREATING SHAREHOLDER VALUE • MANAGEMENT TEAM • REDEFINED REGIONAL STRUCTURE • INVESTMENTS TO DRIVE EFFICIENCIES
Slide 13: Compelling Investment Opportunity: 1. Global Growth Company
COMPELLING INVESTMENT OPPORTUNITY 1. GLOBAL GROWTH COMPANY
Slide 14: Fossil Group Sales Growth
FOSSIL GROUP SALES GROWTH * Trailing Twelve Months ended Q3 2013. Dollars in billions.
Slide 15: Compelling Investment Opportunity: 1. Global Growth Company
COMPELLING INVESTMENT OPPORTUNITY 1. GLOBAL GROWTH COMPANY
Slide 16: Compelling Investment Opportunity: 2. Diversified Business Model
COMPELLING INVESTMENT OPPORTUNITY 2. DIVERSIFIED BUSINESS MODEL
Slide 17: Diversified Business Model
DIVERSIFIED BUSINESS MODEL • BRANDS • PRICE POINTS • CATEGORIES • REGIONS
Slide 18: America
AMERICA OPPORTUNITIES SALES: $1.7B* • RETAIL PRODUCTIVITY • OUTLET EXPANSION • SHOP IN SHOPS • BRAND LEVERAGE MAJOR MARKETS DISTRIBUTION • UNITED STATES • 273 RETAIL STORES • CANADA • DEPARTMENT STORES • MEXICO • SPECIALTY CHAINS • INDEPENDENT RETAILERS • LICENSED BOUTIQUES • ECOMMERCE * Trailing Tw
Slide 19: Europe
EUROPE OPPORTUNITIES SALES: $1.0B* • RETAIL PRODUCTIVITY • NEWER MARKETS • BRAND LEVERAGE • OUTLET EXPANSION MAJOR MARKETS DISTRIBUTION • GERMANY • 167 RETAIL STORES • UK • INDEPENDENT WATCH DEALERS • FRANCE • DEPARTMENT STORES • DISTRIBUTOR MARKETS • SHOP IN SHOPS • CONCESSIONS • ECOMMERCE * Traili
Slide 20: Asia
ASIA OPPORTUNITIES SALES: $0.5B* • CHINA DISTRIBUTION • BRAND LEVERAGE • SWISS MAJOR MARKETS DISTRIBUTION • JAPAN • 103 RETAIL STORES • SOUTH KOREA • CONCESSIONS • AUSTRALIA • SPECIALTY RETAILERS • CHINA • DEPARTMENT STORES • BOUTIQUES * Trailing Twelve Months ended Q3 2013.
Slide 21: Market Share Opportunity
MARKET SHARE OPPORTUNITY 2013 Market Size & Growth for Watches < $1,000 Forecasted 2013 – 2018 CAGR Market Share Source: Euromonitor International 2013
Slide 22: Compelling Investment Opportunity
COMPELLING INVESTMENT OPPORTUNITY 1. GLOBAL GROWTH COMPANY 2. DIVERSIFIED BUSINESS MODEL
Slide 23: Compelling Investment Opportunity: 3. Opportunities for Leverage
COMPELLING INVESTMENT OPPORTUNITY 3. OPPORTUNITIES FOR LEVERAGE
Slide 24: Margin Expansion
MARGIN EXPANSION 2013 * 2008 OPPORTUNITIES Net Sales $ 3,145 $ 1,583 Gross Profit 1,792 851 • INTERNATIONAL GROWTH Gross Margin 57.0% 53.8% • OUTLETS Expenses 1,245 645 • TECHNOLOGY Expense Rate 39.6% 40.8% • PROCESS EFFICIENCY Operating Income $ 547 $ 206 • SUPPORT STRUCTURE OPTIMIZATION Operating
Slide 25: Financial Leverage
FINANCIAL LEVERAGE OPERATING CASH FLOW • SHARE REPURCHASE $454M – NINE MONTHS ENDED Q3 2013 17% FEWER SHARES OVER LAST 3 YEARS * Trailing Twelve Months ended Q3 2013. Dollars in millions.
Slide 26: Compelling Investment Opportunity
COMPELLING INVESTMENT OPPORTUNITY 1. GLOBAL GROWTH COMPANY 2. DIVERSIFIED BUSINESS MODEL 3. OPPORTUNITIES FOR LEVERAGE
Slide 27: Thanks for Stopping By!
THANKS FOR STOPPING BY!