Fossil Group, Inc. (NASDAQ:FOSL) Q4 2017 Earnings Conference Call - Final Transcript
Feb 13, 2018 • 05:00 pm ET
Hello, and welcome to the Fourth Quarter 2017 Fossil Group Incorporated Earnings Teleconference. My name is Michele, and I will be your operator for today's call. [Operator Instructions] Later, we will conduct a question-answer session. [Operator Instructions]
I will now turn the call over to Ms. Allison Malkin. Ma'am, you may begin.
Thank you. Good afternoon, everyone. Thank you for joining us, and welcome to Fossil Group's fourth quarter and full year 2017 earnings conference call. I would like to remind you that the 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 Investors section of our website. Please note that you may listen to a live webcast or replay of this call by visiting www.fossilgroup.com, under the Investors section.
Now, I would like to turn the call over to the company's Chairman and CEO, Kosta Kartsotis.
Kosta N. Kartsotis
Thanks, Allison. Good afternoon, everyone, we appreciate you joining us today. I will begin with a view prepared remarks before returning the call over to Jeff Boyer, our CFO. Following Jeff's comments, we'll have Greg McKelvey, our Chief Strategy and Digital Officer, join us for the Q&A. As we entered 2017, we embarked on making significant changes in the company to improve our business model by focusing on four key operational objectives; to advance our connected tech agenda, to leverage scale to drive cost out of our supply chain, to become more digitally enabled, and to continue the transformation of our business through New World Fossil. Although it had has been a challenging year, we have accomplished many of the goals we set out for ourselves.
Our connected products nearly doubled in size reaching over $300 million in just two years. Our product cost on connected products were down nearly 20% from last year. Operationally, we have reduced our overhead expenses by $95 million versus last year. And on the digital front, we made significant progress on increasing our digital marketing investments and drove strong e-commerce growth. Lastly, we completed our credit facility refinancing to provide an appropriate near-term capital structure for our business.
Within a tough environment and while executing a number of strategic initiatives, we are pleased to deliver our fourth quarter operational results with sales and earnings near the top of our expectations for the quarter. These numbers reflect the focus and outstanding education of