Fossil, Inc. Reports Third Quarter Results

Fossil, Inc. Reports Third Quarter Results

  Third Quarter Net Sales and Diluted Earnings Per Share Continue at Record
                                    Levels

                     Constant Dollar Net Sales Rise 9.9%

           Diluted GAAP Earnings Per Share Increase 15.6% to $1.26

       Diluted Earnings Per Share, As Adjusted, Increase 17.4% to $1.28

RICHARDSON, Texas, Nov. 6, 2012 (GLOBE NEWSWIRE) -- Fossil, Inc. (Nasdaq:FOSL)
(the "Company") today reported third quarternet sales and earnings for the
thirteen-week ("Third Quarter") and thirty-nine week ("Nine Month Period")
periods ended September 29, 2012.

Third Quarter Results (2012 vs 2011):

  *Net sales increased 6.4% to $684.2 million compared to $642.9 million;
  *Gross profit rose 6.1% to $381.5 million, or 55.8% of net sales, compared
    to $359.5 million, or 55.9% of net sales;
  *Operating income decreased 4.8% to $113.1 million, or 16.5% of net sales,
    compared to $118.8 million, or 18.5% of net sales;
  *Income before income taxes increased 1.8% to $113.9 million, or 16.6% of
    net sales, compared to $111.8 million, or 17.4% of net sales;
  *Net income attributable to Fossil, Inc. increased 10.3% to $76.8 million
    compared to $69.6 million; and
  *Diluted earnings per share increased 15.6% to $1.26 and diluted earnings
    per share, as adjusted, increased 17.4% to $1.28, both based on 61.0
    million shares compared to $1.09 on 63.8 million shares.

Nine Month Period Results (2012 vs 2011):

  *Net sales increased 10.0% to $1.91 billion compared to $1.74 billion;
  *Gross profit increased 9.6% to $1.07 billion, or 55.9% of net sales,
    compared to $973.3 million, or 56.0% of net sales;
  *Operating income decreased 4.6% to $284.0 million, or 14.9% of net sales,
    compared to $297.6 million, or 17.1% of net sales;
  *Income before income taxes increased 1.3% to $286.6 million, or 15.0% of
    net sales, compared to $282.8 million, or 16.3% of net sales;
  *Net income attributable to Fossil, Inc. increased 8.8% to $192.3 million
    compared to $176.8 million; and
  *Diluted earnings per share increased 13.1% to $3.11 and diluted earnings
    per share, as adjusted, increased 14.5% to $3.15, both based on 61.8
    million shares compared to $2.75 on 64.2 million shares.

"Double-digit growth in our direct to consumer business and Asia Pacific
region, coupled with expense management and improved gross margin resulted in
Third Quarter earnings surpassing our initial guidance," stated Mike Kovar EVP
and CFO. "Incremental sales from our recently acquired SKAGEN^® brand
additionally helped fuel top line sales growth despite an overall challenging
sales environment in Europe. In addition, we continued to experience
double-digit increases in the sales of watches against a backdrop of sizeable
growth over the last two years. During the quarter we made excellent progress
toward our long-term expansion goals in support of a much larger business in
Asia and capitalizing on the power of our multi-brand watch portfolio."

Operating Results

The translation impact of a stronger U.S. dollar decreased the Company's
reported net sales by approximately $22.2 million and $51.0 million during the
Third Quarter and Nine Month Period, respectively. The following discussion of
the Company's net sales is based on constant dollar performance.

Third Quarter worldwide net sales rose 9.9% as a result of sales growth across
each of the Company's wholesale and direct to consumer segments in comparison
to the prior fiscal year third quarter. The Company's acquisition of Skagen
Designs, Ltd. and certain of its international affiliates ("Skagen") on April
2, 2012 contributed $25.2 million towards overall sales during the Third
Quarter. On an organic basis, excluding sales related to SKAGEN branded
products, worldwide net sales increased 5.9% for the Third Quarter. Global
watch sales were the key driver, increasing 9.5%, or $44.1 million. Third
Quarter leathers product sales remained relatively unchanged from the prior
fiscal year third quarter, increasing 0.9%, or $1.0 million. These sales gains
were partially offset by sales decreases in jewelry of 9.8%, or $4.6 million,
and eyewear of 43.1%, or $3.3 million.Jewelry and eyewear sales have declined
throughout the year as a result of repositioning and market changes impacting
FOSSIL^® branded products in these categories.For the Nine Month Period,
consolidated net sales increased by 12.9%, or $224.3 million, representing
sales growth in each of the Company's global wholesale and direct to consumer
businesses.

Net sales from the North America wholesale segment increased 5.9%, or $14.2
million, during the Third Quarter in comparison to the prior fiscal year third
quarter.The increase in North American sales was primarily attributable to a
9.9%, or $17.5 million, increase in watch sales, including $11.7 million of
sales related to SKAGEN branded products, and a 14.6%, or $1.3 million,
increase in the Company's jewelry business.While global jewelry sales
decreased, North American jewelry sales continued to benefit from the roll-out
of the MICHAEL KORS^® jewelry line. Wholesale shipments in the U.S. were
relatively unchanged in comparison to the prior fiscal year third
quarter.Shipments from the Company's Canadian and Mexican subsidiaries and
shipments to third party distributors in this segment, primarily serving the
South American market, increased 11.6% on a combined basis during the Third
Quarter as compared to the prior fiscal year third quarter. Third Quarter
North American net sales were negatively impacted by a slight shift in the
retail calendar in addition to the impact of certain U.S. wholesale customers
delaying initial holiday receipts from late Third Quarter to the fourth
quarter of fiscal 2012.The Company expects that U.S. wholesale shipments in
the fourth quarter of fiscal 2012 will benefit from these negative influences
on Third Quarter sales.

Europe wholesale net sales during the Third Quarter rose 0.4%, or $0.8
million, including a $9.8 million contribution from sales of SKAGEN branded
products in comparison to the prior fiscal year third quarter.Excluding
SKAGEN branded products, European wholesale sales decreased 5.0%, largely a
result of a 25.0%, or $7.0 million, decrease in the Company's jewelry
business, partially offset by a slight increase in watch sales.Additionally,
the Third Quarter was unfavorably impacted by reduced wholesale shipments of
leather products of $2.0 million.The Company believes a weakening macro
environment in Europe was a contributing factor to the reduction in Third
Quarter sales growth in addition to the impact of repositioning the FOSSIL
jewelry brand.Sales to third party distributors in this segment favorably
impacted the Third Quarter, increasing 3.9%, or $1.4 million, as compared to
the prior fiscal year third quarter.

Asia Pacific wholesale net sales rose 26.6%, or $20.9 million, during the
Third Quarter in comparison to the prior fiscal year third quarter, including
$1.7 million of sales of SKAGEN branded products.Excluding sales of SKAGEN
branded products, Asia Pacific wholesale net sales grew 24.6%, primarily
attributable to increased watch sales of $20.0 million.At the end of the
Third Quarter, the Company operated 247 concession locations in Asia with a
net 43 new concessions opened during the last twelve months.For the Third
Quarter, concession sales increased by 23.5%, with comp sales growing 4.9% in
comparison to the prior fiscal year third quarter.

Direct to consumer net sales for the Third Quarter increased by 19.0%, or
$27.6 million, in comparison to the prior fiscal year third quarter, primarily
the result of a 15.7% increase in the average number of company-owned stores
open during the Third Quarter and comparable store sales gains of 1.8%.The
1.8% comparable store sales gain represents the 18^th consecutive quarter of
comparable store sales increases and follows comparable store sales gains of
14.1% and 19.9% in the third quarter of fiscal 2011 and 2010, respectively.

Gross profit of $381.5 million in the Third Quarter increased 6.1% in
comparison to $359.5 million in the prior fiscal year third quarter.The
increase was a result of increased net sales, partially offset by a 10 basis
point reduction in gross profit margin to 55.8% compared to 55.9% in the prior
fiscal year third quarter.Foreign currency exchange rate changes negatively
impacted gross profit margin by approximately 185 basis points during the
Third Quarter.Excluding the impact of currency, gross profit margin was
favorably impacted by product and segment sales mix, select price increases
across certain watch businesses in addition to increased production
efficiencies and lower watch component costs.These positive influences on
gross profit margin were partially offset by a higher percentage of lower
margin sales to third party distributors.For the Nine Month Period, gross
profit margin decreased by 10 basis points to 55.9% compared to 56.0% in the
comparable prior fiscal year period. During the Nine Month Period, foreign
currency exchange rate changes negatively impacted gross profit margin by
approximately 105 basis points in comparison to the same period in fiscal
2011.Excluding the impact of currency, gross profit margin was favorably
impacted by factors similar to those experienced during the Third Quarter.

Total operating expenses in the Third Quarter increased by $27.7 million and,
as a percentage of net sales, increased to 39.3% in the Third Quarter compared
to 37.4% in the prior fiscal year third quarter.For the Third Quarter,
operating expenses were favorably impacted by approximately $7.8 million as a
result of the translation of foreign-based expenses into U.S. dollars as a
result of a stronger U.S. dollar.Non-recurring costs associated with the
Skagen acquisition totaled $2.0 million during the Third Quarter.On a
constant dollar basis and excluding non-recurring expenses related to the
Skagen acquisition, operating expense increases were primarily attributable to
the addition of Skagen operating costs, expenses associated with an increase
in the number of Company-owned retail stores and expense increases across the
Company's wholesale segments. Expense growth in the Company's wholesale
segments was largely a result of infrastructure investments in the Asia
Pacific region, primarily related to headcount additions and
concession-related costs.For the Nine Month Period, operating expenses
expressed as a percentage of net sales increased to 41.0% compared to 38.9% in
the comparable prior fiscal year period and included an $18.9 million
favorable impact from the translation of foreign-based expenses into U.S.
dollars due to a stronger U.S. dollar.On a constant dollar basis, operating
expenses for the Nine Month Period increased by $126.0 million as compared to
the same period of fiscal 2011, with increases across all of the Company's
operating segments, primarily the result of the same factors that impacted the
Third Quarter. Non-recurring costs associated with the Skagen acquisition
amounted to $3.8 million during the Nine Month Period.This amount included
acquisition and transition related costs of $7.4 million, partially offset by
a $3.6 million favorable gain resulting from mark-to-market valuation
adjustments of a Skagen-related contingent purchase price liability.

As a percentage of net sales, operating income decreased to 16.5% in the Third
Quarter and 14.9% during the Nine Month Period compared to 18.5% and 17.1% for
the respective comparable periods in the prior fiscal year. During the Third
Quarter and Nine Month Period, operating income was negatively impacted by
approximately $17.7 million and $29.9 million, respectively, as a result of
the translation of foreign-based sales and expenses into U.S. dollars as a
result of a stronger U.S. dollar. Excluding the impact of foreign currency
rate changes, the Third Quarter and Nine Month Period operating income, as a
percentage of net sales, would have approximated 18.5% and 16.0%,
respectively.

Other income/expense-net increased favorably by $8.8 million and $19.7 million
for the Third Quarter and Nine Month Period, respectively, in comparison to
the comparable prior fiscal year periods.These increases were primarily
driven by net foreign currency gains during the current fiscal year periods in
comparison to net losses in the respective prior fiscal year periods resulting
from mark-to-market, hedging and other transactional activities.At prevailing
foreign currency exchange rates, the Company estimates that outstanding
forward contracts with scheduled settlement dates in the fourth quarter of
fiscal 2012 would result in hedge gains of approximately $0.5 million.

The Company's income tax expense for the Third Quarter was $34.0 million,
resulting in an effective income tax rate of 29.8%.For the prior fiscal year
third quarter, income tax expense was $39.3 million, resulting in an effective
income tax rate of 35.2%.Income tax expense was $85.2 million for the Nine
Month Period, resulting in an effective tax rate of 29.7%.For the comparable
fiscal 2011 period, income tax expense was $98.2 million, resulting in an
effective tax rate of 34.7%.The lower effective tax rates in the Third
Quarter and the Nine Month Period were attributable to a higher portion of
foreign income taxed at lower overall foreign rates, a reduction in income tax
rates in several countries and management's decision to indefinitely reinvest
the undistributed earnings of certain foreign subsidiaries.The Company
estimates its effective income tax rate for the fourth quarter of fiscal 2012
will approximate 25%, including an approximate $10 million, or $0.17 diluted
earnings per share, income tax benefit related to the settlement of prior year
income tax audits.

Third Quarter net income attributable to Fossil, Inc. increased by 10.3% to
$76.8 million.Diluted earnings per share increased 15.6% to $1.26, inclusive
of an unfavorable $0.10 per diluted share decrease related to net foreign
currency losses and a $0.06 per diluted share benefit related to a 4.5% lower
outstanding share count as a result of the Company's ongoing stock repurchase
program.Diluted earnings per share, as adjusted, increased 17.4% to $1.28 in
the Third Quarter as compared to the prior fiscal year third quarter.For the
Nine Month Period, net income attributable to Fossil, Inc. of $192.3 million
represented an 8.8% increase compared to the $176.8 million earned during the
comparable prior fiscal year period.Diluted earnings per share increased
13.1% to $3.11, and diluted earnings per share, as adjusted, increased 14.5%
to $3.15 in the Nine Month Period.Net income attributable to Fossil, Inc. for
the Nine Month Period included net foreign currency losses of $0.12 per
diluted share and a benefit of $0.12 per diluted share related to a 3.8% lower
outstanding share count.

Selective Balance Sheet Information

At September 29, 2012, the Company had cash, cash equivalents and securities
available for sale of $143.0 million, compared to $239.6 million at October 1,
2011, and $184.9 million of debt compared to $14.9 million of debt at October
1, 2011.The decrease in cash and increase in debt over the last twelve months
was primarily related to the acquisition of Skagen during the second quarter
of fiscal 2012 and the continuation of the Company's stock repurchase
plan.Since the end of the prior fiscal year third quarter, the Company has
repurchased approximately 3.1 million shares of its common stock at an
aggregate cost of $262.8 million.During the period from the announcement of
the Company's $750 million buyback authorization in August 2010 until the end
of the Third Quarter, the Company has repurchased approximately $646.4 million
of its common stock, representing approximately 8.5 million shares.

Inventory at September 29, 2012 was $589.0 million, representing an increase
of 15.1% from the October 1, 2011 balance of $511.7 million.The Company
expects fiscal 2012 year-end inventories will approximate prior fiscal year
end levels.Accounts receivable increased by 6.4% to $290.7 million at
September 29, 2012 compared to $273.3 million at the end of the prior fiscal
year third quarter, primarily due to an increase in wholesale shipments during
the Third Quarter versus the prior fiscal year third quarter.Days sales
outstanding for the Company's wholesale segments for the Third Quarter was 50
days in comparison to 49 days in the prior fiscal year third quarter.

Sales and Earnings Guidance

For the fourth quarter of fiscal 2012, the Company expects reported net sales
to increase approximately 12%, with constant dollar net sales increasing
13%.The Company's current outlook for fourth quarter sales growth represents
an approximate 400 basis point decrease to its previous guidance, primarily
related to its European wholesale business.

The Company is providing earnings guidance on a reported basis and an as
adjusted basis.Guidance on an as adjusted basis excludes non-recurring costs
associated with the acquisition of Skagen as well as certain tax benefits
expected in the fourth quarter of fiscal 2012.A reconciliation of guidance on
a generally accepted accounting principles ("GAAP") basis to the as adjusted
basis is presented in tabular form at the end of this earnings release.The
Company currently expects fourth quarter reported diluted GAAP earnings per
share in a range of $2.41 to $2.44, with diluted earnings per share, as
adjusted, in a range of $2.26 to $2.29.The Company's fourth quarter fiscal
2012 diluted earnings per share, as adjusted, estimate reflects a 21% to 22%
increase to its prior fiscal year fourth quarter diluted earnings per share of
$1.87.As a result of the better than expected Third Quarter earnings per
share performance the Company is raising its fiscal year 2012 earnings
estimates.The Company expects fiscal 2012 reported diluted GAAP earnings per
share in a range of $5.53 to $5.56, with diluted earnings per share, as
adjusted, in a range of $5.42 to $5.45.The Company's fiscal year 2012 diluted
earnings per share, as adjusted, estimate represents an approximate 18%
increase to its fiscal 2011 diluted earnings per share of $4.61.The Company's
forward guidance is based upon the current prevailing rate of the U.S. dollar
compared to other foreign currencies for countries in which it operates.

Safe Harbor

Certain statements contained herein that are not historical facts constitute
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995 and involve a number of risks and
uncertainties.The actual results of the future events described in such
forward-looking statements could differ materially from those stated in such
forward-looking statements.Among the factors that could cause actual results
to differ materially are: changes in economic trends and financial
performance, changes in consumer demands, tastes and fashion trends, lower
levels of consumer spending resulting from a general economic downturn, shifts
in market demand resulting in inventory risks, changes in foreign currency
exchange rates, difficulties in integrating the recently acquired Skagen
businesses, and the outcome of current and possible future litigation, as well
as the risks and uncertainties set forth in the Company's Annual Report on
Form 10-K for the fiscal year ended December 31, 2011 and its Quarterly
Reports on Form 10‑Q filed with the Securities and Exchange Commission (the
"SEC").

About Fossil

Fossil is a global design, marketing and distribution company that specializes
in consumer fashion accessories.The Company's principal offerings include an
extensive line of men's and women's fashion watches and jewelry sold under
proprietary and licensed brands, handbags, small leather goods, belts,
sunglasses, soft accessories, shoes and clothing. In the watch and jewelry
product categories, the Company's offerings include a diverse portfolio of
globally recognized proprietary and licensed brand names under which its
products are marketed. The Company's extensive range of accessory products,
brands, distribution channels and price points allows it to target
style-conscious consumers across a wide age spectrum on a global basis.The
Company's products are sold to department stores, specialty retail stores and
specialty watch and jewelry stores in the U.S. and in approximately 120
countries worldwide through 23 Company-owned foreign sales subsidiaries and a
network of over 60 independent distributors.The Company also distributes its
products in over 400 Company-owned and operated retail stores and through
international e-commerce websites and the Company's U.S. e-commerce website at
www.fossil.com, where certain product, press release and SEC filing
information concerning the Company are also available.

The Fossil, Inc. logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=3296


Consolidated Income                                             
Statement Data (in         For the 13    For the 13  For the 39    For the 39
millions except per share  Weeks Ended   Weeks Ended Weeks Ended   Weeks Ended
data):
                                                               
                          September 29, October 1,  September 29, October 1,
                           2012          2011        2012          2011
                                                               
Net sales                  $ 684.2     $ 642.9   $ 1,909.8   $ 1,736.5
                                                               
Cost of sales              302.7         283.4       842.9         763.2
                                                               
Gross profit               381.5         359.5       1,066.9       973.3
                                                               
Selling and distribution   193.3         172.2       571.0         495.2
expenses
                                                               
General and administrative 75.1          68.5        211.9         180.5
expenses
                                                               
Operating income           113.1         118.8       284.0         297.6
                                                               
Interest expense           1.4           0.4         3.6           1.3
                                                               
Other income (expense) –  2.2           (6.6)       6.2           (13.5)
net
                                                               
Income before income taxes 113.9         111.8       286.6         282.8
                                                               
Tax provision              34.0          39.3        85.2          98.2

Less:Net income           3.1           2.9         9.1           7.8
attributable to
noncontrolling interest
Net income attributable to                                      
Fossil, Inc.               $ 76.8      $ 69.6    $ 192.3     $ 176.8
                                                               
Basic earnings per share   $1.27     $1.10   $3.13      $2.78
                                                               
Diluted earnings per share $1.26      $1.09    $3.11      $2.75

Weighted average common                                         
shares outstanding :
                                                               
Basic                      60.6         63.2       61.3          63.5
                                                               
Diluted                    61.0          63.8        61.8         64.2

                                                                 
                                                                 
                                                                 
                                                    September 29, October 1,
Consolidated Balance Sheet Data (in millions):       2012          2011
                                                    $ 789.4    $ 788.1
Working capital

Cash, cash equivalents and securities available      143.0         239.6
forsale
                                                    290.7         273.3
Accounts receivable, net of allowances
                                                    589.0         511.7
Inventories
                                                    1,851.1       1,536.2
Total assets
                                                    6.0           10.6
Short-term debt
                                                    178.9         4.3
Long-term debt
                                                    123.3         102.9
Deferred taxes and other long-term liabilities
                                                    1,163.1       1,067.2
Stockholders' equity
                                                                 

                                               
Business Segment Sales  Amounts                  Percentage of Total
($ in millions)         For the 13 Weeks Ended   For the 13 Weeks Ended
                       September 29, October 1, September 29, October 1,
                        2012          2011       2012          2011
Wholesale:                                                  
North Americawholesale $ 254.0     $ 240.6  37.1%         37.4%
Europe                  163.5       178.3    23.9%         27.8%
Asia Pacific            97.6         78.6     14.3%         12.2%
Total wholesale         515.1       497.5    75.3%       77.4%
                                                           
Direct to consumer      169.1         145.4      24.7%         22.6%
Total net sales                                100.0%        100.0%
                        $684.2      $642.9

                                               
                                               
                                               
Business Segment Sales Amounts                   Percentage of Total
($ in millions)        For the 39 Weeks Ended    For the 39 Weeks Ended
                      September 29, October 1,  September 29, October 1,
                       2012          2011        2012          2011
Wholesale:                                                  
North America          $ 728.8     $ 660.4   38.2%         38.0%
Europe                 464.1       471.9     24.3%         27.2%
Asia Pacific           258.7        210.7      13.5%         12.1%
Total wholesale        1,451.6     1,343.0   76.0%       77.3%
                                                           
Direct to consumer     458.2         393.5       24.0%         22.7%
Total net sales                                100.0%        100.0%
                       $1,909.8    $1,736.5

Constant Currency Financial Information

The following table presents the Company's business segment sales on a
constant currency basis.To calculate net sales on a constant currency basis,
net sales for the current fiscal year period for entities reporting in
currencies other than the U.S. dollar are translated into U.S. dollars at the
actual effective rates during the comparable period of the prior fiscal year.

                 Net Sales                    Net Sales
(in millions)   For the 13 Weeks Ended       For the 39 Weeks Ended
                 September 29, 2012           September 29, 2012
                         Impact of                    Impact of 
                          Foreign             As        Foreign
                As       Currency   Constant Reported   Currency   Constant
                 Reported Exchange   Currency            Exchange   Currency
                          Rates                          Rates
Wholesale:                                                     
North America   $254.0 $(0.9)   $254.9 $728.8   $(3.8)   $732.6
Europe           163.5   (15.5)    179.0   464.1     (35.6)    499.7
Asia Pacific     97.6   (1.9)     99.5    258.7      (3.6)     262.3
Total wholesale  515.1   (18.3)    533.4   1,451.6   (43.0)    1,494.6
                                                              
Direct to        169.1   (3.9)     173.0   458.2      (8.0)     466.2
consumer
                                                              
Total net sales  $684.2  $(22.2)   $706.4 $1,909.8 $(51.0)  $1,960.8

Non-GAAP Financial Information

The information below has been presented on a GAAP basis and on an as adjusted
basis excluding the impact of costs related to the acquisition of
Skagen.These adjusted presentations are non-GAAP financial
measures.Management believes these measures provide investors with useful
supplemental information regarding the Company's underlying business trends
and the performance of the Company's ongoing operations and are useful for
period-over-period comparisons and projected earnings of such operations. In
addition, management uses these non-GAAP financial measures internally in its
budgeting and review process.

While management believes that these non-GAAP financial measures are useful in
evaluating the Company's business, this information should be considered as
supplemental in nature and should be viewed in addition to, and not in lieu of
or superior to, the Company's operating performance measures calculated in
accordance with GAAP.In addition, these non-GAAP financial measures may not
be the same as similarly titled measures presented by other companies.

                            For the 13 Weeks Ended  For the 39 Weeks Ended
                             September 29, 2012       September 29, 2012
                                        As a                   As a
                            Amounts    Percentage   Amounts    Percentage
                             (in         of Net Sales (in         of Net Sales
                             millions)                millions)
                                                              

Pretax income, as reported   $113.9     16.6%        $286.6   15.0%
under GAAP
                                                              
Skagen acquisition items:                                      

Acquisition-related          1.2        0.2%         7.4        0.4%
transaction and transition
costs

Mark-to-market of liability  0.8       0.1%         (3.6)      (0.2%)
related to contingent
purchase price
                                                              
Pretax income, as adjusted   $115.9    16.9%        $290.4   15.2%

                                                              
                                                              
                                                                Projected
                                        For the 39  Projected    Range for
                           For the 13   Weeks Ended  Range for    the
                          Weeks Ended  September    the          Fiscal Year
                           September    29,          13 Weeks     Ending
                           29,          2012         Ending       December 29,
                           2012                      December 29, 2012
                                                     2012
Diluted earnings per                                 $2.41 –     $5.53 –
share, as reported under   $1.26      $3.11      2.44        5.56
GAAP
                                                              
Skagen acquisition items                                       
(net of tax):

Acquisition-related        0.01        0.08         0.02        0.10
transaction and transition
costs

Mark-to-market of          0.01       (0.04)      0.00        (0.04)
liability related to
contingent purchase price
                                                              
Income tax benefit from
prior year audit                                   (0.17)       (0.17)
settlements
Diluted earnings per       $1.28      $3.15     $2.26 –    $5.42 –
share, as adjusted                                   2.29         5.45

CONTACT: Mike Kovar
         Chief Financial Officer
         Fossil, Inc.
         (972) 699-6811
        
         Investor Relations:
         Allison Malkin
         ICR, Inc.
         (203) 682-8225

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