For the three months ended Jan. 4, income leaped 48.3 percent to $23.3 million, or 48 cents a diluted share, from $15.7 million, or 33 cents, in the year-ago quarter. Excluding a $2.9 million one-time charge in 2001, income climbed a more modest 25.4 percent. Sales for the most recent quarter rose 20.6 percent to $212.4 million from $176.1 million. Gross profit grew 22.6 percent to $109.5 million, or 51.6 percent of sales, versus $89.4 million, or 50.7 percent of sales, last year.
Kosta Kartsotis, president and chief executive officer, said during a conference call with Wall Street analysts that the company plans to open seven outlets in 2003 and either two or three regular-priced stores.
Mike Kovar, chief financial officer, said in a statement: "Our European operations remained a primary focus throughout the year and we are extremely pleased with our European sales increase of 51 percent during the fourth quarter. We experienced 67 percent growth in our licensed brands and a 36 percent growth in our Fossil brand in Europe, benefiting from the additional Fossil advertising committed to Europe during the year."
Total international sales rose 46 percent during the quarter. Global sales of new product initiatives, including Burberry and Zodiac watches and Emporio Armani jewelry, added $6.1 million during the period. Acquisitions contributed $2.2 million in European sales during the three-month period, with company-owned retail store sales rising 18 percent and comparable-store sales gaining 5 percent.
Domestically, fourth-quarter sales from the watch business gained 6.6 percent, with strength in the Relic brand and licensed brand watches. Sales of Fossil watches dipped 3 percent because of specialty store sales that were softer than expected, while accessories and sunglass sales were flat versus a year ago.
For 2003 guidance, the company estimated that sales and diluted earnings per share would increase 15 percent for the year.
For the year, income rose 34.9 percent to $58.9 million, or $1.22 a diluted share, from $43.7 mil-Sales were up 21.6 percent to $663.3 million from $545.5 million.