We’re supporting these new products with celebrity influencer
moncler outlet store Fossil Group FOSL Q3 2017 Results moncler outlet store
moncler jackets men Sign in / Join NowWelcome to the Q3 2017 Fossil Group earnings conference call. My name is Richard, and I’ll be your operator for today’s call. At this time, all participants are in a listen only mode. Later, we will conduct a question and answer session. Please note that this conference is being recorded.I will now turn the call over to Eunice Han, ICR. You moncler online store may begin.Thank you. Good afternoon, everyone. Thank you for joining us and welcome to Fossil Group’s third quarter 2017 earnings conference call.I would like to remind best moncler jackets you that information made available during this conference call contains forward looking information, and actual results could differ materially from those that will be projected during this call. Fossil Group’s policy on forward looking statements and additional information concerning a number of factors that could cause actual results to differ materially from such statements is readily available in our Form 8 K and 10 Q reports filed with the SEC. In addition, the company assumes no obligation to publicly update or revise any forward looking statements, whether as a result of new information, future events, or otherwise, except as required by law.Please note that you can find a reconciliation and other information regarding non GAAP financial measures discussed on this call in our earnings release filed on Form 8 K and in the Investor Relations section of our website.Now I would like to turn the call over to the company’s Chairman and CEO, Kosta Kartsotis.Kosta N. Kartsotis Fossil cheap moncler jackets womens Group, Inc.Thank you. Good afternoon, everyone. I will begin with a few prepared remarks before turning the call over to Jeff Boyer. Jeff officially joined us on October 16 moncler outlet online as our CFO and has been working with Dennis Secor during his transition into uk moncler sale the Fossil Group.As you know, Jeff has been a member of our Board of Directors for 10 years, and we are glad to have him joining us during this crucial time in the business. discount moncler jackets His knowledge of our business model and organization has been moncler sale outlet very beneficial during his first few weeks. Following Jeff’s comments, we’ll have Greg McKelvey, our Chief Strategy and Digital Officer, join us for https://www.monclerdownjacket.biz the Q as cheap moncler coats mens well as Dennis Secor.While our business remains challenging and the retail environment remains in flux, we are pleased to deliver solid third quarter sales and moncler outlet earnings that cheap moncler jackets mens align with our expectation for the quarter. These numbers reflect the focus and solid execution of our team as we transition our business, bringing innovative new products to the market and drive operational efficiencies that can ultimately enhance our profitability.There continues to be significant work ahead of us, but in the quarter, we made substantial progress against three operational objectives: to advance our wearable tech agenda; leverage scale to drive costs out of our supply chain; and to continue with the transformation of our business through our New World Fossil initiative. Beyond our operational efforts, we managed our working capital tightly, as we continue to work with our partners to support moncler outlet store our longer term capital requirements.As we enter the all important holiday selling period, we are very excited about the potential of our new product launches and their ability to positively impact the business. We remain confident that wearables moncler usa can be one of the key catalysts that offsets the declines that we’ve seen in our traditional watch business for some time now and ultimately turn those headwinds into tailwinds. The response moncler outlet prices from our customers continues to be strong and we are very encouraged by the results, particularly from some of our key brands.While our business is still challenging and the retail environment remains in flux, we drove a sequential improvement moncler sale online in our overall sales trends in the quarter. In watches, sales declined 4% in the quarter, about half the decline rate that we experienced in the first half of the year. We continue to see significant to green shoots in the business that give us confidence that the investments we are making are right for the long term.Wearables already are having a significant impact on the sales trajectory for a number of our key brands. Global Fossil brand watch sales increased modestly in the third quarter, led by solid growth in both Europe and Asia. For each of the last four quarters, wearables have consistently improved the sales growth rates moncler outlet online for Fossil watches by more than 10 percentage points, and moncler uk outlet they did so again in the cheap moncler jackets third quarter.The same is true for Michael Kors watches, where wearables have positively impacted growth trends by more than 10 full points, going back to the fourth quarter of last year. And for Emporio Armani, where we launched Emporio Armani Connected display watches this quarter, sales are also up moncler sale on a year to date basis.Innovation continues to be at the center of what we do, and you will see that with this fall’s product launches. Our third generation of wearables product are sleeker and thinner, giving us an even greater opportunity to appeal to our core female customers. These amazing new watches have brighter screens and improved functionality, giving customers the ability to personalize and customize the watch base to their individual preferences.For Fossil, our Q Venture and Q Explorist models have already hit the stores, and we are expecting strong performance during the holiday season. We’re supporting these new products with celebrity influencer campaigns to meet the wearable customer where they shop and where they interact with cheap moncler sale brands in the digital and social space.In Michael Kors, we recently launched Sofie, our next generation display watch, in the Kors boutiques, and the initial response has been very strong. We expanded the launch across all our distribution channels in late September to a strong response. And if the trends continue, the Sofie moncler outlet sale is on pace to be our number one wearable style.We launched two more brands onto our wearables platform, Emporio Armani and Diesel, both late in September, and the responses thus far exceeded our expectations. We recently launched our Misfit Vapor smartwatch, which has heart rate and swim proof functionality and is selling extremely well right out of the box. This gives us a total of five brands on our display platform.On hybrids, we’re launching five more brands with the introductions of Tory Burch, DKNY, Marc Jacobs, MICHELE, and Relic, which will bring us to a total of 14 brands in wearables, and support our goal this year to at least double the wearables business we delivered in 2016.We’re excited about these amazing new products, and we’re committed to creating awareness and buzz around them to drive sales. To communicate these new product launches, we are using celebrity influencer campaigns across multiple brands that are more significant than anything we’ve ever been there before. We’re getting behind these launches with significant increases in marketing. Among ourselves and our partners, we’re adding more than $20 million of additional marketing support beyond last year’s fourth quarter levels to drive awareness in these fashion first tech accessories, educate moncler womens jackets consumers on the features of these new products, and to drive traffic to the stores and our e comm sites.Another of our key focus areas has been to leverage our considerable scale in wearables to drive supply chain efficiencies, reduce costs, and improve our margins. Our strategy this moncler outlet woodbury year has been to drive significant volume in wearables to get these amazing products on as many wrists as quickly as we can and to leverage that volume to drive cost efficiencies.We’re creating products that consumers have never seen before, fashion branded connected devices, so gauging consumer responsiveness and demand with little history has been challenging. Our plan this year was to invest roughly 10 points of Connected margins in an effort to gain scale.So far for the first three quarters of uk moncler outlet this year, we have tripled our Connected business from the same period last year, an impressive growth rate, and we’re extremely proud of that, but we’re still short of the aggressive goals we set for ourselves. As a result, we’re carrying more inventory than we planned, and we are working on selling that product through. That created some margin pressure as we set up reserves in the third quarter, and Jeff will provide some color on that.However, more important to note is that we’re actually exceeding our Connected cost goals, delivering better initial margins than we had planned going into the year. We believe that bodes very well for the future. As we move into next year, our inventory planning will be informed by what we have learned this year about the customers’ responsiveness to our products and the effectiveness of our marketing. As we better align our inventory buys with demand, we believe that the progress we’ve made this year in our supply chain will set us up to quickly improve our Connected margins and deliver our longer term margin goals moncler jackets men.