UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
|
ý |
QUARTERLY REPORT PURSUANT TO SECTION 13 OR
15(d) |
|
|
|
|
|
|
For the quarterly period ended: April 3, 2004 |
||
|
|
|
|
|
OR |
||
|
|
|
|
|
o |
TRANSITION REPORT PURSUANT TO SECTION 13 OR
15(d) |
|
|
|
||
|
Commission file number: 0-19848 |
||
|
FOSSIL, INC. |
||
|
(Exact name of registrant as specified in its charter) |
||
|
|
|
|
|
Delaware |
|
75-2018505 |
|
(State or other
jurisdiction of |
|
(I.R.S. Employer |
|
|
|
|
|
2280 N. Greenville Avenue, Richardson, Texas 75082 |
||
|
(Address of
principal executive offices) |
||
|
|
|
|
|
(972) 234-2525 |
||
|
(Registrant’s telephone number, including area code) |
||
Indicate by check mark whether registrant (1) has filed all reports to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes ý No o
Indicate by check mark whether registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).
Yes ý No o
The number of shares of Registrant’s common stock outstanding as of May 11, 2004: 70,538,472
PART 1 - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
FOSSIL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
UNAUDITED
(In thousands, except share amounts)
|
|
|
April 3, |
|
January 3, |
|
||
|
ASSETS |
|
|
|
|
|
||
|
Current assets: |
|
|
|
|
|
||
|
Cash and cash equivalents |
|
$ |
156,525 |
|
$ |
158,062 |
|
|
Short-term marketable investments |
|
6,114 |
|
5,991 |
|
||
|
Accounts receivable – net |
|
112,583 |
|
121,908 |
|
||
|
Inventories |
|
142,308 |
|
126,789 |
|
||
|
Deferred income tax assets |
|
10,703 |
|
8,653 |
|
||
|
Prepaid expenses and other current assets |
|
20,873 |
|
17,917 |
|
||
|
Total current assets |
|
449,106 |
|
439,320 |
|
||
|
|
|
|
|
|
|
||
|
Investment in joint venture |
|
5,011 |
|
4,635 |
|
||
|
Property, plant and equipment – net |
|
114,363 |
|
116,066 |
|
||
|
Intangible and other assets – net |
|
27,499 |
|
27,520 |
|
||
|
|
|
$ |
595,979 |
|
$ |
587,541 |
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
||
|
Current liabilities: |
|
|
|
|
|
||
|
Notes payable |
|
$ |
2,871 |
|
$ |
2,805 |
|
|
Accounts payable |
|
20,730 |
|
27,196 |
|
||
|
Accrued expenses: |
|
|
|
|
|
||
|
Accrued accounts payable |
|
23,605 |
|
21,938 |
|
||
|
Accrued royalties |
|
8,015 |
|
10,543 |
|
||
|
Compensation |
|
13,659 |
|
15,648 |
|
||
|
Co-op advertising |
|
6,544 |
|
14,292 |
|
||
|
Other |
|
10,991 |
|
11,040 |
|
||
|
Income taxes payable |
|
24,645 |
|
22,297 |
|
||
|
Total current liabilities |
|
111,060 |
|
125,759 |
|
||
|
|
|
|
|
|
|
||
|
Deferred income tax liability |
|
39,689 |
|
32,861 |
|
||
|
Minority interest in subsidiaries |
|
4,765 |
|
5,495 |
|
||
|
Stockholders’ equity: |
|
|
|
|
|
||
|
Common stock, 70,440,540 and 69,941,510 shares issued and outstanding, respectively |
|
704 |
|
466 |
|
||
|
Additional paid-in capital |
|
31,104 |
|
25,881 |
|
||
|
Retained earnings |
|
395,699 |
|
379,354 |
|
||
|
Accumulated other comprehensive income |
|
16,645 |
|
20,969 |
|
||
|
Deferred compensation |
|
(3,687 |
) |
(3,244 |
) |
||
|
Total stockholders’ equity |
|
440,465 |
|
423,426 |
|
||
|
|
|
|
|
|
|
||
|
|
|
$ |
595,979 |
|
$ |
587,541 |
|
See notes to condensed consolidated financial statements.
1
FOSSIL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
AND COMPREHENSIVE INCOME
UNAUDITED
(In thousands, except per share amounts)
|
|
|
For the 13 |
|
For the 13 |
|
||
|
|
|
|
|
|
|
||
|
Net sales |
|
$ |
199,395 |
|
$ |
169,767 |
|
|
Cost of sales |
|
95,775 |
|
84,151 |
|
||
|
Gross profit |
|
103,620 |
|
85,616 |
|
||
|
|
|
|
|
|
|
||
|
Operating expenses: |
|
|
|
|
|
||
|
Selling and distribution |
|
57,048 |
|
51,138 |
|
||
|
General and administrative |
|
20,093 |
|
14,656 |
|
||
|
Total operating expenses |
|
77,141 |
|
65,794 |
|
||
|
|
|
|
|
|
|
||
|
Operating income |
|
26,479 |
|
19,822 |
|
||
|
Interest expense |
|
5 |
|
4 |
|
||
|
Other (expense) income – net |
|
(530 |
) |
(233 |
) |
||
|
Income before income taxes |
|
25,944 |
|
19,585 |
|
||
|
Provision for income taxes |
|
9,599 |
|
7,442 |
|
||
|
Net income |
|
$ |
16,345 |
|
$ |
12,143 |
|
|
|
|
|
|
|
|
||
|
Other comprehensive income (loss), net of taxes: |
|
|
|
|
|
||
|
Currency translation adjustment |
|
(6,396 |
) |
(4,313 |
) |
||
|
Unrealized gain (loss) on short-term investments |
|
47 |
|
(79 |
) |
||
|
Forward contracts hedging intercompany foreign currency payments: change in fair values |
|
2,025 |
|
668 |
|
||
|
Total comprehensive income |
|
$ |
12,021 |
|
$ |
8,419 |
|
|
|
|
|
|
|
|
||
|
Earnings per share: |
|
|
|
|
|
||
|
Basic |
|
$ |
0.23 |
|
$ |
0.17 |
|
|
Diluted |
|
$ |
0.22 |
|
$ |
0.17 |
|
|
Weighted average common shares outstanding: |
|
|
|
|
|
||
|
Basic |
|
70,007 |
|
69,618 |
|
||
|
Diluted |
|
73,744 |
|
72,370 |
|
||
See notes to condensed consolidated financial statements.
2
FOSSIL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
UNAUDITED
(In thousands)
|
|
|
For the 13 |
|
For the 13 |
|
||
|
Operating activities: |
|
|
|
|
|
||
|
Net income |
|
$ |
16,345 |
|
$ |
12,143 |
|
|
Noncash items affecting net income: |
|
|
|
||||