Fossil Group Posts Upbeat Q1 Earnings, Issues Strong Outlook

Shares of

jumped over 4 percent in after-hours trading after the company reported upbeat earnings for the first quarter and issued a strong forecast. The Richardson, Texas-based company posted a quarterly profit of $38.1 million, or $0.75 per share, versus a year-ago profit of $66.3 million, or $1.22 per share. In constant currency, the company's earnings were $0.88 per share, including $0.16 per share in restructuring charge. Its sales slipped 7 percent to $725 million. However, analysts were expecting earnings of $0.64 per share on revenue of $732.02 million. The average estimate among 16 Estimize users was for earnings of $0.63 per share and revenue of $728.88 million. Net sales in the Americas slipped 4 percent or $16.0 million, while net sales in Europe fell 10 percent or $26.1 million. Net sales in Asia slipped 7 percent or $9.3 million in the quarter. Global retail comps for the first quarter rose 2 percent year-over-year in the latest quarter. Its gross margin shrank 180 basis points to 55.3 percent. Kosta Kartsotis, Chief Executive Officer, said, "With our first quarter complete, we feel we are on track to achieve our goals for the year. Our diversified global operating platform and powerful brands continued to serve us well, leading to first quarter net sales and overall performance that were in line with our current financial expectations." Fossil projects adjusted profit of $1.18 to $1.29 per share for the second quarter, versus analysts' estimates of $0.71 per share. The company expects adjusted profit of $7 to $7.60 per share for the year, versus analysts' estimates of $5.80 per share. Fossil Group shares climbed 4.38 percent to $90.25 in the after-hours trading session.