Tags: Fossil | Sales | Profit | Shares

Fossil Sales, Profit Forecast Send Shares Lower

Tuesday, 13 May 2014 05:19 PM

Fashion accessory maker and retailer Fossil Group Inc. forecast a weaker-than-expected profit for this quarter after reporting the third straight decline in comparable-store sales in North America. The company's shares fell after the news Tuesday

The company, which sells watches ranging from $7 to upwards of $2,000, has been struggling to keep up with fast-growing affordable luxury peers such as Michael Kors Holdings Ltd and Kate Spade & Co.

Fossil said it expects second-quarter earnings in the range of 90-97 cents per share.

Analysts on average were expecting $1.16 per share, according to Thomson Reuters I/B/E/S.

The retailer forecast current-quarter sales to rise between 8 percent and 9.5 percent, which translates to about $764.5 million-$775 million — largely below analysts' average expectations of $773.4 million.

Fossil said watch sales in stores open for at least a year fell in North America, its largest market, due to weak mall traffic in the first quarter ended April 5.

Global retail comparable-store sales fell 2.4 percent, marking the third straight quarter of decline.

Worldwide net sales increased 14 percent to $776.5 million.

Operating expense jumped 19 percent to $338.5 million.

Net income fell to $66.3 million, or $1.22 per share, from $72.2 million, or $1.21 per share, a year ago.

Analysts on average expected the company to earn $1.17 on revenue of $777.6 million, according to Thomson Reuters I/B/E/S.

Shortly after 5 p.m. in New York, Fossil shares were down 5.3 percent at $105.60. The shares fell less than 1 percent during the regular Nasdaq session, to end at $112.08. The shares have fallen more than 11 percent in 6 months.

© 2017 Thomson/Reuters. All rights reserved.

 
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Fashion accessory maker and retailer Fossil Group Inc. forecast a weaker-than-expected profit for this quarter after reporting the third straight decline in comparable-store sales in North America.
Fossil, Sales, Profit, Shares
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2014-19-13
Tuesday, 13 May 2014 05:19 PM
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