Fossil Group Inc (NASDAQ:FOSL) reported better-than-expected results for its third quarter on Wednesday.
The Richardson, Texas-based company revealed Thursday 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 was 52.8%, representing 120 basis points of expansion compared to the third quarter of 2019.
Operating income was $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 proved to be $324 million, and total debt of $239 million as of October 3, 2020.
Said CEO Kosta Kartsotis,“The organization continues to execute well in the face of a challenging environment.
“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.”
FOSL shares sprang up $1.47, or 24.6%, to $7.44.
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