Fossil Signs Deal With Kate Spade, Releases Financials
Posted Flat 4th-Quarter Sales
Fossil Group Inc., the parent company of Fossil Corporate Markets (asi/55145), signed a global licensing agreement this week with Kate Spade & Co. to design, develop and distribute kate spade new york watches through 2025. Fossil is assuming kate spade new york’s existing watch business, but won’t be launching its own collection of the lifestyle brand’s watches until next year.
Kosta Kartsotis, CEO of Fossil Group, said his company is excited to partner with Kate Spade, a brand he described as “experiencing explosive growth” with “substantial long-term potential.” He added in a company press release: “The brand has a distinctive voice, fits perfectly within our portfolio, and we look forward to a meaningful relationship for years to come.”
The CEO of Kate Spade & Co., Craig A. Leavitt, echoed Kartsotis’ sentiments. “It is clear that Fossil Group shares our passion for creative design and quality craftsmanship, and we are confident they are the right partner as we expand this important elastic category,” he said.
The partnership announcement comes at the same time that Fossil posted flat fourth-quarter sales. Wholesale net sales were down 4%, though direct-to-consumer net sales were up 12%. Watch sales were down 1% and leathers were down 2%, but net jewelry sales were up 13%, according to the report. Fossil Q4 sales came in around $1.07 billion, missing analysts’ projections of $1.12 billion in sales. Overall, for fiscal year 2014, Fossil saw an 8% increase in net sales, compared to 2013.
“We are not entirely satisfied with our fourth-quarter performance and begin 2015 intensely focused on taking advantage of the many opportunities available to us to drive future growth,” Kartsotis said.