Fossil Group, Inc. (NASDAQ:FOSL) Q4 2018 Earnings Conference Call Transcript

Feb 13, 2019 • 05:00 pm ET


Fossil Group, Inc. (NASDAQ:FOSL) Q4 2018 Earnings Conference Call Transcript


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Welcome to the Fourth Quarter and Fiscal Year 2018 Fossil Group Incorporated Earnings Conference Call. My name is Adrian, and I'll be your operator for today's call. At this time, all participants are in a listen-only mode. Later, we'll conduct a question-and-answer session. (Operator Instructions) Please note, this conference is being recorded.

I'll now turn the call over to Allison Malkin. Allison Malkin, you may begin.

Allison C. Malkin

Thank you. Good afternoon, everyone. Thank you for joining us, and welcome to Fossil Group's Fourth Quarter 2018 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 discussed 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 statement 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. In addition you may listen to a live webcast or replay of this call by visiting 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, and thanks for joining our call today. I will begin with a few comments regarding last year and 2019, and then turn the call over to Jeff Boyer, our CFO, to cover our Q4 financial performance and financial outlook for next year. Following Jeff's comments, we'll have Greg McKelvey, our Chief Strategy and Digital Officer join us for the Q&A. Note that our sales comments today will be based on constant currency unless noted otherwise.

As you know, we are on a multiyear journey to transform our company. The watch and accessory business is changing at a rapid pace around the globe. Consumer preferences and shopping patterns continue to shift. Product innovation and watches has expended the category overall, but has caused a move away from traditional watches towards connected product. Marketing, product information, and consumer research on watches and fashion accessories are shifting from our traditional brick-and-mortar channels to online ones. To address these structural shifts and improve the long-term health of our business we identified a number of key priorities for 2018.

Our most important priority this past year was to improve our profitability and our financial condition. Due to fundamental structural changes in the watch and accessory categories, we recognize the need to be highly focused on improving our financial condition to provide us the flexibility to make the necessary changes to our overall business model. One critical element was