Fossil Inc. breezed through the fourth quarter, posting a 22 percent gain in profits, and the watchmaker plans keep expanding this year with additional investment in Asia and in its own direct-to-consumer operations.
Quarterly profits attributable to the firm rose 22 percent to $117.9 million, or $1.87 a diluted share, from $96.7 million, or $1.46, a year earlier. Sales for the three months ended Dec. 31 increased 18.5 percent to $830.8 million from $701.1 million.
Earnings per share came in 10 cents ahead of the $1.77 analysts expected and investors pushed the company’s stock up 7 percent to $111.81 in midday trading.
The firm’s wholesales sales, in constant currencies, showed broad-based geographic expansion during the quarter with sales in North America up 18 percent to $47 million, while sales in Europe gained 18.5 percent to $35 million and Asia advanced 13.8 percent to $10.3 million Direct-to-consumer sales increased 22.5 percent to $39.4 million.
For the full year, the firm logged profits of $294.7 million, or $4.61 a diluted share, on sales of $2.57 billion, with the Fossil brand tipping the scales at over $1 billion in sales.
This year, the company expects earnings per share to climb to $5.40 to $5.50.
“As we begin fiscal year 2012, we will continue to emphasize the strategies that contributed to our strong performance last year,” said Mike Kovar, executive vice president and chief financial officer. “We will continue our investment in support of our expansion in Asia and in our direct to consumer channel with expectations that this will lead to sustainable long-term growth.”
Fossil will also be expanding with Skagen Designs, which the firm last month agreed to buy for $236.8 million.