Cover Page
Cover Page - USD ($) $ in Millions | 12 Months Ended | ||
Jan. 02, 2021 | Mar. 05, 2021 | Jul. 04, 2020 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Jan. 2, 2021 | ||
Current Fiscal Year End Date | --01-02 | ||
Document Transition Report | false | ||
Entity File Number | 0-19848 | ||
Entity Registrant Name | FOSSIL GROUP, INC. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 75-2018505 | ||
Entity Address, Address Line One | 901 S. Central Expressway, | ||
Entity Address, City or Town | Richardson, | ||
Entity Address, State or Province | TX | ||
Entity Address, Postal Zip Code | 75080 | ||
City Area Code | 972 | ||
Local Phone Number | 234-2525 | ||
Title of 12(b) Security | Common Stock, $0.01 par value | ||
Trading Symbol | FOSL | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 137.6 | ||
Entity Common Stock, Shares Outstanding (in shares) | 51,525,632 | ||
Documents Incorporated by Reference | Portions of the registrant's proxy statement to be furnished to shareholders in connection with its 2021 Annual Meeting of Stockholders are incorporated by reference in Part III, Items 10-14 of this Annual Report on Form 10-K. | ||
Entity Central Index Key | 0000883569 | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jan. 02, 2021 | Dec. 28, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 315,965 | $ 200,218 |
Accounts receivable-net | 229,847 | 289,744 |
Inventories | 295,296 | 452,278 |
Prepaid expenses and other current assets | 149,367 | 117,218 |
Total current assets | 990,475 | 1,059,458 |
Property, plant and equipment-net | 114,026 | 151,500 |
Operating lease right-of-use assets | 226,815 | 288,166 |
Intangible and other assets-net | 147,189 | 105,608 |
Total long-term assets | 488,030 | 545,274 |
Total assets | 1,478,505 | 1,604,732 |
Current liabilities: | ||
Accounts payable | 178,212 | 172,191 |
Short-term and current portion of long-term debt | 41,561 | 26,228 |
Accrued expenses: | ||
Current operating lease liabilities | 64,851 | 68,838 |
Compensation | 78,085 | 51,573 |
Royalties | 27,554 | 28,427 |
Customer liabilities | 50,941 | 80,803 |
Transaction taxes | 21,271 | 25,683 |
Other | 62,846 | 76,209 |
Income taxes payable | 33,205 | 29,228 |
Total current liabilities | 558,526 | 559,180 |
Long-term income taxes payable | 19,840 | 31,284 |
Deferred income tax liabilities | 495 | 2,097 |
Long-term debt | 185,852 | 178,796 |
Long-term operating lease liabilities | 230,635 | 288,689 |
Other long-term liabilities | 43,125 | 40,845 |
Total long-term liabilities | 479,947 | 541,711 |
Commitments and contingencies (Note 14) | ||
Stockholders' equity: | ||
Common stock, 51,474 and 50,516 shares issued and outstanding at January 2, 2021 and December 28, 2019, respectively | 515 | 505 |
Additional paid-in capital | 293,777 | 283,371 |
Retained earnings | 203,698 | 299,793 |
Accumulated other comprehensive income (loss) | (58,900) | (80,615) |
Total Fossil Group, Inc. stockholders' equity | 439,090 | 503,054 |
Noncontrolling interest | 942 | 787 |
Total stockholders' equity | 440,032 | 503,841 |
Total liabilities and stockholders' equity | $ 1,478,505 | $ 1,604,732 |
Common stock, shares outstanding (in shares) | 51,474,034 | 50,516,477 |
Common stock, shares outstanding (in shares) | 51,474,034 | 50,516,477 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - shares | Jan. 02, 2021 | Dec. 28, 2019 |
Statement of Financial Position [Abstract] | ||
Common stock, shares issued (in shares) | 51,474,034 | 50,516,477 |
Common stock, shares outstanding (in shares) | 51,474,034 | 50,516,477 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME (LOSS) AND COMPREHENSIVE INCOME (LOSS) - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | |
Income Statement [Abstract] | |||
Net sales | $ 1,613,343 | $ 2,217,712 | $ 2,541,488 |
Cost of sales | 842,987 | 1,118,274 | 1,201,351 |
Gross profit | 770,356 | 1,099,438 | 1,340,137 |
Operating expenses: | |||
Selling, general and administrative expenses | 866,703 | 1,081,572 | 1,224,584 |
Trade name impairments | 2,464 | 16,613 | 6,212 |
Restructuring charges | 36,508 | 29,636 | 46,630 |
Total operating expenses | 905,675 | 1,127,821 | 1,277,426 |
Operating income (loss) | (135,319) | (28,383) | 62,711 |
Interest expense | 31,836 | 29,932 | 42,503 |
Other income (expense) - net | (4,828) | 26,984 | (38) |
Income (loss) before income taxes | (171,983) | (31,331) | 20,170 |
Provision for income taxes | (76,043) | 18,681 | 21,108 |
Net income (loss) | (95,940) | (50,012) | (938) |
Less: Net income attributable to noncontrolling interest | 155 | 2,353 | 2,540 |
Net income (loss) attributable to Fossil Group, Inc. | (96,095) | (52,365) | (3,478) |
Other comprehensive income (loss), net of taxes: | |||
Currency translation adjustment | 19,296 | (5,606) | (10,369) |
Cash flow hedges - net change | (2,133) | (5,599) | 20,673 |
Pension plan activity | 4,552 | (4,719) | 3,267 |
Total other comprehensive income (loss) | 21,715 | (15,924) | 13,571 |
Total comprehensive income (loss) | (74,225) | (65,936) | 12,633 |
Less: Comprehensive income attributable to noncontrolling interest | 155 | 2,353 | 2,540 |
Comprehensive income (loss) attributable to Fossil Group, Inc. | $ (74,380) | $ (68,289) | $ 10,093 |
Earnings (loss) per share: | |||
Basic (in dollars per share) | $ (1.88) | $ (1.04) | $ (0.07) |
Diluted (in dollars per share) | $ (1.88) | $ (1.04) | $ (0.07) |
Weighted average common shares outstanding: | |||
Basic (in shares) | 51,116 | 50,230 | 49,196 |
Diluted (in shares) | 51,116 | 50,230 | 49,196 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Cumulative Effect, Period of Adoption, Adjustment | Stockholders' Equity Attributable to Fossil Group, Inc. | Stockholders' Equity Attributable to Fossil Group, Inc.Cumulative Effect, Period of Adoption, Adjustment | Common Stock | Additional Paid-in Capital | Treasury Stock | Retained Earnings | Retained EarningsCumulative Effect, Period of Adoption, Adjustment | Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income (Loss)Cumulative Effect, Period of Adoption, Adjustment | Noncontrolling Interest |
Balance at beginning of period (in shares) at Dec. 30, 2017 | 48,643,000 | |||||||||||
Balance at beginning of period at Dec. 30, 2017 | $ 580,947 | $ 576,133 | $ 486 | $ 242,263 | $ 0 | $ 409,653 | $ (76,269) | $ 4,814 | ||||
Balance at beginning of period (Accounting Standards Update 2014-09) at Dec. 30, 2017 | $ (26,542) | $ (26,542) | $ (26,542) | |||||||||
Increase (Decrease) in Shareholders' Equity | ||||||||||||
Common stock issued upon exercise of stock options, stock appreciation rights and restricted stock units (in shares) | 1,055,000 | |||||||||||
Common stock issued upon exercise of stock options and stock appreciation rights | 298 | 298 | $ 11 | 287 | ||||||||
Acquisition of common stock | (2,856) | (2,856) | 0 | (2,856) | ||||||||
Retirement of common stock (in shares) | (180,000) | |||||||||||
Retirement of common stock | 0 | $ (2) | (2,854) | 2,856 | ||||||||
Stock-based compensation | 28,376 | 28,376 | 28,376 | |||||||||
Net income (loss) | (938) | (3,478) | (3,478) | 2,540 | ||||||||
Other comprehensive income (loss) | 13,571 | 13,571 | 13,571 | |||||||||
Distribution of noncontrolling interest earnings and other | $ (4,225) | 41 | 41 | (4,266) | ||||||||
Accounting Standards Update [Extensible List] | us-gaap:AccountingStandardsUpdate201602Member | |||||||||||
Adoption of ASU 2018-02 | $ (1,993) | 1,993 | $ (1,993) | |||||||||
Balance at end of period (in shares) at Dec. 29, 2018 | 49,518,000 | |||||||||||
Balance at end of period at Dec. 29, 2018 | 588,631 | $ (29,468) | 585,543 | $ (29,468) | $ 495 | 268,113 | 0 | 381,626 | $ (29,468) | (64,691) | 3,088 | |
Increase (Decrease) in Shareholders' Equity | ||||||||||||
Common stock issued upon exercise of stock options, stock appreciation rights and restricted stock units (in shares) | 1,302,000 | |||||||||||
Common stock issued upon exercise of stock options and stock appreciation rights | 170 | 170 | $ 13 | 157 | ||||||||
Acquisition of common stock | (4,197) | (4,197) | (4,197) | |||||||||
Retirement of common stock (in shares) | (304,000) | |||||||||||
Retirement of common stock | 0 | $ (3) | (4,194) | 4,197 | ||||||||
Stock-based compensation | 19,064 | 19,064 | 19,064 | |||||||||
Net income (loss) | (50,012) | (52,365) | (52,365) | 2,353 | ||||||||
Other comprehensive income (loss) | (15,924) | (15,924) | (15,924) | |||||||||
Purchase of noncontrolling interest shares | (562) | 231 | 231 | (793) | ||||||||
Distribution of noncontrolling interest earnings and other | $ (3,861) | 0 | 0 | (3,861) | ||||||||
Balance at end of period (in shares) at Dec. 28, 2019 | 50,516,477 | 50,516,000 | ||||||||||
Balance at end of period at Dec. 28, 2019 | $ 503,841 | 503,054 | $ 505 | 283,371 | 0 | 299,793 | (80,615) | 787 | ||||
Increase (Decrease) in Shareholders' Equity | ||||||||||||
Common stock issued upon exercise of stock options, stock appreciation rights and restricted stock units (in shares) | 1,127,000 | |||||||||||
Common stock issued upon exercise of stock options and stock appreciation rights | 0 | 0 | $ 11 | (11) | ||||||||
Acquisition of common stock | (727) | (727) | (727) | |||||||||
Retirement of common stock (in shares) | (169,000) | |||||||||||
Retirement of common stock | 0 | $ (1) | (726) | 727 | ||||||||
Stock-based compensation | 11,143 | 11,143 | ||||||||||
Net income (loss) | (95,940) | (96,095) | (96,095) | 155 | ||||||||
Other comprehensive income (loss) | $ 21,715 | 21,715 | 21,715 | |||||||||
Balance at end of period (in shares) at Jan. 02, 2021 | 51,474,034 | 51,474,000 | ||||||||||
Balance at end of period at Jan. 02, 2021 | $ 440,032 | $ 439,090 | $ 515 | $ 293,777 | $ 0 | $ 203,698 | $ (58,900) | $ 942 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | |
Operating Activities: | |||
Net income (loss) | $ (95,940) | $ (50,012) | $ (938) |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||
Depreciation, amortization and accretion | 43,134 | 54,792 | 67,584 |
Stock-based compensation | 11,143 | 15,845 | 23,044 |
Non-cash lease expense | 109,327 | 120,011 | 0 |
(Decrease) increase in allowance for returns and markdowns | (29,903) | 15,752 | (13,987) |
Bad debt expense | 9,535 | 2,921 | 8,921 |
Non-cash restructuring charges | 2,532 | 5,196 | 6,252 |
(Gain) loss on disposal of assets | (13,611) | (4,584) | 656 |
Gain on asset divestitures | 0 | (23,134) | 0 |
Property, plant and equipment and other long-lived asset impairment losses | 31,584 | 8,660 | 2,039 |
Trade name impairment losses | 2,464 | 16,613 | 6,212 |
Other non cash items | 13,737 | (1,424) | 10,707 |
Loss on extinguishment of debt | 0 | 3,044 | 718 |
Contingent consideration remeasurement | 628 | (601) | (3,381) |
Changes in operating assets and liabilities: | |||
Accounts receivable | 60,747 | 30,940 | 68,308 |
Inventories | 168,603 | (78,135) | 153,445 |
Prepaid expenses and other current assets | (27,714) | 10,994 | (15,356) |
Accounts payable | 3,500 | 4,862 | (38,365) |
Accrued expenses | 3,001 | (30,049) | (13,477) |
Income taxes | (60,030) | 4,570 | (14,243) |
Operating lease liabilities | (131,499) | (120,470) | 0 |
Net cash provided by (used in) operating activities | 101,238 | (14,209) | 248,139 |
Investing Activities: | |||
Additions to property, plant and equipment | (8,738) | (20,894) | (17,961) |
(Increase) decrease in intangible and other assets | (1,956) | (3,252) | 1,626 |
Proceeds from the sale of property, plant, equipment | 78 | 1,255 | 717 |
Proceeds from asset divestitures | 0 | 41,570 | 0 |
Net cash (used in) provided by investing activities | (10,616) | 18,679 | (15,618) |
Financing Activities: | |||
Acquisition of common stock | (727) | (4,197) | (2,856) |
Distribution of noncontrolling interest earnings and other | 0 | (3,861) | (4,224) |
Purchase of noncontrolling interest shares | 0 | (562) | 0 |
Debt borrowings | 317,250 | 685,332 | 811,007 |
Debt payments | (295,771) | (870,552) | (857,474) |
Payment for shares of Fossil Accessories South Africa Pty. Ltd. | 0 | (1,169) | (1,947) |
Debt issuance costs and other | (10,000) | (13,477) | (7,163) |
Net cash provided by (used in) financing activities | 10,752 | (208,486) | (62,657) |
Effect of exchange rate changes on cash and cash equivalents, and restricted cash | 15,123 | 882 | 9,364 |
Net increase (decrease) in cash and cash equivalents, and restricted cash | 116,497 | (203,134) | 179,228 |
Cash and cash equivalents, and restricted cash: | |||
Beginning of year | 207,749 | 410,883 | 231,655 |
End of year | $ 324,246 | $ 207,749 | $ 410,883 |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Jan. 02, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Significant Accounting Policies | Significant Accounting Policies Consolidated Financial Statements include the accounts of Fossil Group, Inc., a Delaware corporation, and its subsidiaries (the "Company"). The Company is a leader in the design, development, marketing and distribution of contemporary, high quality fashion accessories on a global basis. The Company's products are sold primarily through department stores, specialty retailers, Company-owned retail stores and commercial websites worldwide. The Company reports on a fiscal year reflecting the retail-based calendar (containing 4-4-5 week calendar quarters). References to fiscal years 2020, 2019 and 2018 are for the fiscal years ended January 2, 2021, December 28, 2019 and December 29, 2018, respectively. The Company's fiscal year periodically results in a 53-week year instead of a normal 52-week year. The fiscal year ended January 2, 2021 was a 53-week year, with the additional week included in the first quarter of the fiscal year. Accordingly, the information presented herein includes 53 weeks of operations for fiscal year 2020 as compared to 52 weeks in fiscal years 2019 and 2018. All intercompany balances and transactions are eliminated in consolidation. Use of Estimates is required in the preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America. Management makes estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, management evaluates its estimates and judgments, including those related to product returns, bad debt, inventories, long-lived asset impairment, impairment of trade names, income taxes, warranty costs and litigation liabilities. Management bases its estimates and judgments on the information available at the time and various other assumptions believed to be reasonable under the circumstances, including estimates of the impact of the coronavirus (“COVID-19”) pandemic. Management estimates form the basis for making judgments about the carrying value of the assets and liabilities that are not readily apparent from other sources. Actual results could differ from those estimates, including the impact of the COVID-19 pandemic. Concentration of Risk involves financial instruments that potentially expose the Company to concentration of credit risk and consist primarily of cash investments and accounts receivable. The Company places its cash investments with high-credit quality financial institutions and currently invests primarily in corporate debt securities and money market funds with major banks and financial institutions. Accounts receivable are generally diversified due to the number of entities comprising the Company's customer base and their dispersion across many geographic regions. The Company believes no significant concentration of credit risk exists with respect to these cash investments and accounts receivable. A significant portion of sales of the Company's products are supplied by manufacturers located outside of the U.S., primarily in Asia. While the Company is not dependent on any single manufacturer outside the U.S., the Company could be adversely affected by political, economic or other disruptions affecting the business or operations of third-party manufacturers located outside of the U.S. In fiscal year 2020, 43% of the Company's global watch production was assembled or procured through wholly or majority-owned factories. The Company has entered into multi-year, worldwide exclusive license agreements for the manufacture, distribution and sale of products bearing the brand names of certain globally recognized fashion companies. Sales of the Company's licensed products amounted to 47.3%, 45.7% and 46.6% of the consolidated net sales for fiscal years 2020, 2019 and 2018, respectively, of which EMPORIO ARMANI ® product sales accounted for 19.1%, 15.2% and 12.0% of the consolidated net sales for fiscal years 2020, 2019 and 2018, respectively, and MICHAEL KORS ® product sales accounted for 17.0%, 19.2% and 22.6% of the consolidated net sales for fiscal years 2020, 2019 and 2018, respectively. Cash Equivalents are considered all highly liquid investments with original maturities of three months or less. Restricted Cash was comprised primarily of restricted cash balances for pledged collateral to secure bank guarantees for the purpose of obtaining retail space. The following table provides a reconciliation of the cash, cash equivalents, and restricted cash balances as of January 2, 2021, December 28, 2019 and December 29, 2018 that are presented in the consolidated statement of cash flows (in thousands): January 2, 2021 December 28, 2019 December 29, 2018 Cash and cash equivalents $ 315,965 $ 200,218 $ 403,373 Restricted cash included in prepaid expenses and other current assets 121 30 31 Restricted cash included in intangible and other assets-net 8,160 7,501 7,479 Cash, cash equivalents and restricted cash $ 324,246 $ 207,749 $ 410,883 Accounts Receivable at the end of fiscal years 2020 and 2019 are stated net of doubtful accounts of approximately $20.8 million and $13.2 million, respectively. Inventories are stated at the lower of cost and net realizable value, including any applicable duty and freight charges. Inventory held at consignment locations is included in the Company's finished goods inventory, and at the end of fiscal years 2020 and 2019, was $46.0 million and $51.0 million, respectively. Investments in which the Company has significant influence over the investee are accounted for utilizing the equity method. If the Company does not have significant influence over the investee, the cost method is utilized. The Company's cost method investment was $0.3 million and $0.5 million at the end of fiscal years 2020 and 2019. Lease assets represent the right to use an underlying asset for the lease term, and lease liabilities represent the obligation to make lease payments arising from the lease. These assets and liabilities are initially recognized based on the present value of lease payments over the lease term calculated using the Company's incremental borrowing rate, adjusted for the lease term and lease country, unless the implicit rate is readily determinable. Lease assets also include any upfront lease payments made and are reduced by lease incentives. Some lease terms include options to extend or terminate the lease and they are included in the measurement of the lease assets and lease liabilities if the Company is reasonably certain that those options will be exercised. Variable lease payments are expensed as incurred and include certain index-based changes in rent and certain non-lease components such as maintenance and other services provided by the lessor to the extent the charges are variable. The Company evaluates contractual arrangements at inception to determine if individual agreements are a lease or contain an identifiable lease component as defined by Accounting Standards Codification ("ASC") 842, Leases ("ASC 842"). When evaluating contracts to determine appropriate classification and recognition under ASC 842, significant judgment may be necessary to determine, among other criteria, if an embedded leasing arrangement exists, the length of the term, classification as either an operating or financing lease and whether renewal or termination options are reasonably certain to be exercised. Leases with an initial term of 12 months or less are not recorded on the balance sheet. Lease agreements with lease and non-lease components are combined as a single lease component for all classes of underlying assets. The depreciable life of lease assets and leasehold improvements is limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise. Lease assets are evaluated for impairment whenever events or conditions indicate that the carrying value of an asset may not be recoverable based on expected undiscounted cash flows related to the asset. In fiscal year 2020, lease impairment losses of $27.3 million and $2.9 million were recorded in selling, general, and administrative ("SG&A") and restructuring charges, respectively. In fiscal year 2019, lease impairment losses of $7.9 million and $1.7 million were recorded in SG&A and restructuring charges, respectively. Property, Plant and Equipment is stated at cost less accumulated depreciation and amortization. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets of 30 years for buildings, generally five years for machinery and equipment and furniture and fixtures and two to seven years for computer equipment and software. Leasehold improvements are amortized over the shorter of the lease term or the asset's estimated useful life. Property, plant and equipment is evaluated for impairment whenever events or conditions indicate that the carrying value of an asset may not be recoverable based on expected undiscounted cash flows related to the asset. Property, plant and equipment impairment losses of underperforming Company-owned retail stores of $4.0 million, $0.7 million and $1.9 million were recorded in SG&A and impairment losses of $1.1 million, $0.6 million and $1.7 million were recorded in restructuring charges in fiscal years 2020, 2019 and 2018, respectively. Additionally, in fiscal years 2020, 2019 and 2018, the Company recorded a loss on disposal related to the disposal of property, plant and equipment of $0.1 million, $0.5 million and $0.6 million, respectively, included in restructuring charges in the Company’s consolidated statements of income (loss) and comprehensive income (loss). Other Intangible Assets include trademarks, trade names, developed technology, customer lists and patents. Trademarks, trade names with finite lives, developed technology, customer lists and patents are amortized using the straight-line method over their estimated useful lives, which are generally three to 20 years. Indefinite-lived trade names are evaluated for impairment annually as of the end of the fiscal year. Additionally, if events or conditions were to indicate an indefinite-lived trade name may not be recoverable, the Company would evaluate the asset for impairment at that time. Impairment testing compares the carrying amount of an intangible asset with its fair value. When the carrying amount of an intangible asset exceeds its fair value, an impairment charge is recorded. The fair value of the Company's MICHELE ® trade name was estimated using the relief from royalty method. During fiscal year 2020, the MICHELE trade name with a carrying amount of $10.9 million was written down to its implied fair value of $8.4 million, resulting in a pre-tax impairment charge of $2.5 million. No impairment charges were recorded to the MICHELE trade name during fiscal years 2019 or 2018. The SKAGEN ® trade name is being fully amortized on a straight-line basis over its estimated remaining useful life of 5 years as of January 2, 2021. No impairment charges were recorded to the SKAGEN trade name during fiscal year 2020. Pre-tax impairment charges of $16.6 million and $6.2 million were recorded related to the SKAGEN trade name for fiscal years 2019 and 2018, respectively. Accrued Expenses includes liabilities relating to warranties, duty, deferred compensation, gift cards, foreign exchange forward contracts ("forward contracts") and other accrued liabilities which are current in nature. Other Long-Term Liabilities includes obligations relating to asset retirements, forward contracts and defined benefits relating to certain international employees that are not current in nature. Cumulative Translation Adjustment is included as a component of accumulated other comprehensive income (loss) and reflects the adjustments resulting from translating the financial statements of foreign subsidiaries into U.S. dollars. The functional currency of the Company's foreign subsidiaries is the currency of the primary economic environment in which the entity operates, which is generally the local currency of the country. Accordingly, assets and liabilities of the foreign subsidiaries are translated to U.S. dollars at fiscal year-end exchange rates. Income and expense items are translated at average monthly exchange rates. Cumulative translation adjustments remain in accumulated other comprehensive income (loss) and are reclassified into earnings in the event the related foreign subsidiary is sold or liquidated. Foreign Transaction Gains and Losses are those changes in exchange rates of currencies not considered the functional currency that affects cash flows and the related receivables or payables. The Company incurred net foreign currency transaction gains (losses) of approximately $(6.5) million, $3.9 million and $(5.8) million for fiscal years 2020, 2019 and 2018, respectively. These net gains (losses) have been included in other income (expense)—net in the Company's consolidated statements of income (loss) and comprehensive income (loss). Revenues from sales of the Company's products, including those that are subject to inventory consignment agreements, are recognized when control of the product is transferred to the customer and in an amount that reflects the consideration the Company expects to be entitled in exchange for the product. The Company accepts limited returns from customers. The Company continually monitors returns and maintains a provision for estimated returns based upon historical experience and any specific issues identified. Product returns are accounted for as reductions to revenue and cost of sales and increases to customer liabilities and other current assets to the extent the returned product is resalable. The Company recorded an estimated returns provision of $49.8 million and $77.5 million in accrued expenses as of the end of fiscal years 2020 and 2019, respectively. Taxes imposed by governmental authorities on the Company's revenue-producing activities with customers, such as sales taxes and value added taxes, are excluded from net sales. See Note 2—Revenue, for more information regarding the Company's revenue recognition policy. Cost of Sales includes raw material costs, assembly labor, assembly overhead including depreciation expense, assembly warehousing costs and shipping and handling costs related to the movement of finished goods from assembly locations to sales distribution centers and from sales distribution centers to customer locations. Additionally, cost of sales includes customs duties, product packaging cost, royalty cost associated with sales of licensed products, the cost of molding and tooling and inventory shrinkage and damages. Operating Expenses include SG&A, trade name impairments and restructuring charges. SG&A expenses include selling and distribution expenses primarily consisting of sales and distribution labor costs, sales distribution center and warehouse facility costs, depreciation expense related to sales distribution and warehouse facilities, the four-wall operating costs of the Company's retail stores, point-of-sale expenses, advertising expenses and art, design and product development labor costs. SG&A also includes general and administrative expenses primarily consisting of administrative support labor and "back office" or support costs such as treasury, legal, information services, accounting, internal audit, human resources, executive management costs and costs associated with stock-based compensation. Restructuring charges include costs to reorganize, refine and optimize the Company’s infrastructure and store closures. See Note 20—Restructuring for additional information on the Company’s restructuring plan. Advertising Costs for in-store and media advertising as well as co-op advertising, catalog costs, product displays, show/exhibit costs, advertising royalties related to the sales of licensed brands, internet costs associated with affiliation fees, printing, sample costs and promotional allowances are expensed as incurred within SG&A. Advertising costs were $126.3 million, $171.0 million and $181.0 million for fiscal years 2020, 2019 and 2018, respectively. Warranty Costs are included in SG&A. The Company records an estimate for future warranty costs based on historical repair costs and adjusts the liability as required. Warranty costs have historically been within the Company's expectations and the provisions established. If such costs were to substantially exceed estimates, this could have an adverse effect on the Company's operating results. See Note 4—Warranty Liabilities, for more information regarding warranties. Research and Development Costs are incurred primarily through the Company's in-house engineering team and also through some outside consulting and labor and consist primarily of personnel-related expenses, tooling and prototype materials and overhead costs. The Company’s research and development ("R&D") expenses are related to designing and developing new products and features and improving existing products. The Company's R&D expenses are recorded in SG&A and were $25.9 million, $32.4 million and $38.2 million in fiscal years 2020, 2019 and 2018, respectively. Noncontrolling Interest is recognized as equity in the Company's consolidated balance sheets, is reflected in net income attributable to noncontrolling interest in the consolidated statements of income (loss) and comprehensive income (loss) and is captured within the summary of changes in equity attributable to controlling and noncontrolling interests. Noncontrolling interests represent ownership interests in the Company's subsidiaries held by third parties. Other Comprehensive Income (Loss) which is reported in the consolidated statements of income (loss) and comprehensive income (loss) and consolidated statements of stockholders' equity, consists of net income and other gains and losses affecting equity that are excluded from net income. The components of other comprehensive income (loss) primarily consist of foreign currency translation gains and losses and net realized and unrealized gains and losses on the following: (i) derivatives designated as cash flow hedges and (ii) the Company's defined benefit plans. Earnings (Loss) Per Share ("EPS") is based on the weighted average number of common shares outstanding during each period. Diluted EPS adjusts basic EPS for the effects of dilutive common stock equivalents outstanding during each period using the treasury stock method. The following table reconciles the numerators and denominators used in the computations of both basic and diluted EPS (in thousands except per share data): Fiscal Year 2020 2019 2018 Numerator: Net income (loss) attributable to Fossil Group, Inc. $ (96,095) $ (52,365) $ (3,478) Denominator: Basic EPS computation: Basic weighted average common shares outstanding 51,116 50,230 49,196 Basic EPS $ (1.88) $ (1.04) $ (0.07) Diluted EPS computation: Basic weighted average common shares outstanding 51,116 50,230 49,196 Diluted weighted average common shares outstanding 51,116 50,230 49,196 Diluted EPS $ (1.88) $ (1.04) $ (0.07) Approximately 2.4 million, 3.4 million and 5.1 million weighted average shares issuable under stock-based awards were not included in the diluted EPS calculation in fiscal years 2020, 2019 and 2018, respectively, because they were antidilutive, including approximately 0.3 million, 0.6 million and 1.2 million weighted performance-based shares in fiscal years 2020, 2019 and 2018, respectively. Income Taxes are provided for under the asset and liability method for temporary differences in assets and liabilities recognized for income tax and financial reporting purposes. Deferred tax assets are periodically assessed for the likelihood of whether they are more likely than not to be realized. Tax benefits associated with uncertain tax positions are recognized in the period in which one of the following conditions is satisfied: (i) the more likely than not recognition threshold is satisfied; (ii) the position is ultimately settled through negotiation or litigation; or (iii) the statute of limitations for the taxing authority to examine and challenge the position has expired. Tax benefits associated with an uncertain tax position are derecognized in the period in which the more likely than not recognition threshold is no longer satisfied. The Global Intangible Low-Taxed Income (“GILTI”) provisions of the Tax Cuts and Jobs Act (the "Tax Act") requiring the inclusion of certain foreign earnings in U.S. taxable income first applied in fiscal year 2018. The GILTI tax was accounted for as incurred under the period cost method. The Company's valuation allowance analysis is affected by various aspects of the Tax Act, including the new limitation on the deductibility of interest expense and the impact of GILTI. Those adjustments may materially impact the provision for income taxes and the effective tax rate in the period in which the adjustments are made. Recently Issued Accounting Standards In March 2020, the Financial Accounting Standards Board ("FASB") issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting ("ASU 2020-04") and subsequent guidance that clarified the scope and application of its original guidance. ASU 2020-04 provides optional expedients and exceptions to the current guidance on contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The amendments in this update apply only to contracts and hedging relationships that reference the London Interbank Offered Rate ("LIBOR") or another reference rate expected to be discontinued due to reference rate reform. The guidance was effective upon issuance and generally can be applied to applicable contract modifications through December 31, 2022. The Company will adopt these standards when LIBOR is discontinued and does not expect them to have a material impact on its consolidated financial statements or related disclosures. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes ("ASU 2019-12"). ASU 2019-12 simplifies the accounting for income taxes by removing certain exceptions to general principles in Income Taxes (Topic 740) . It also clarifies and amends existing guidance to improve consistent application. The guidance is effective for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years. The Company does not expect this standard to have a material impact on the Company's consolidated results of operations or financial position. Recently Adopted Accounting Standards In August 2018, the FASB issued ASU 2018-15, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40) ("ASU 2018-15"). ASU 2018-15 aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The Company adopted ASU 2018-15 at the beginning of the first quarter of fiscal year 2020, and it did not have a material effect on the Company's consolidated financial statements. In August 2018, the FASB issued ASU 2018-14, Compensation-Retirement Benefits-Defined Benefit Plans-General (Subtopic 715-20): Disclosure Framework-Changes to the Disclosure Requirements for Defined Benefit Plans ("ASU 2018-14"). ASU 2018-14 removes certain disclosures that are not considered cost beneficial, clarifies certain required disclosures and adds additional disclosures. The Company adopted ASU 2018-14 at the beginning of the first quarter of fiscal year 2020, and it did not have a material effect on the Company's consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement ("ASU 2018-13"). ASU 2018-13 (i) eliminates certain disclosure requirements related to the fair value hierarchy, (ii) adds new disclosure requirements related to the changes in unrealized gains and losses for recurring Level 3 fair value measurements and the range and weighted average of significant observable inputs used to develop Level 3 fair value measurements and (iii) modifies certain disclosure requirements related to measurement uncertainty for fair value measurements. The Company adopted ASU 2018-13 at the beginning of the first quarter of fiscal year 2020, and it did not have a material effect on the Company's consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments ("ASU 2016-13"). ASU 2016-13 modifies the measurement of expected credit losses of certain financial instruments, including trade receivables. The estimate of expected credit losses requires the consideration of historical information, current information and reasonable and supportable forecasts. The Company adopted ASU 2016-13 at the beginning of the first quarter of fiscal year 2020 on a prospective basis, and it did not have a material effect on the Company's consolidated financial statements. |
Revenue
Revenue | 12 Months Ended |
Jan. 02, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | REVENUE The Company’s revenue consists of sales of finished products to customers through wholesale and retail channels. Revenue from the sale of products, including those that are subject to inventory consignment agreements, is recognized when control of the product is transferred to the customer and in an amount that reflects the consideration the Company expects to be entitled in exchange for the product. The Company generally considers control to transfer either when products ship or when products are delivered depending on the shipping terms in the agreement or purchase order. The Company considers control to have transferred upon shipment or delivery because the Company has a present right to payment, the customer has legal title to the product, the Company has transferred physical possession of the product, and the customer has the significant risks and rewards of the product. Taxes imposed by governmental authorities on the Company's revenue-producing activities with customers, such as sales taxes and value added taxes, are excluded from net sales. Markdowns. The Company provides markdowns to certain customers in order to facilitate sales of select styles. Markdowns are estimated at the time of sale using historical data and are recorded as a reduction to revenue. The Company's policy is to record its markdown allowance as a reduction of accounts receivable. Returns. The Company accepts limited returns from customers. The Company continually monitors returns and maintains a provision for estimated returns based upon historical experience, any specific issues identified and current information. Product returns are accounted for as reductions to revenue, cost of sales and customer liabilities and an increase to other current assets to the extent the returned product is resalable. While returns have historically been within management's expectations and the provisions established, future return rates may differ from those experienced in the past. In the event that the Company's products are performing poorly in the retail market and/or it experiences product damages or defects at a rate significantly higher than the historical rate, the resulting returns could have an adverse impact on the operating results for the period or periods in which such returns occur. Cooperative Advertising. The Company participates in cooperative advertising programs with its major retail customers, whereby the Company shares the cost of certain of their advertising and promotional expenses. Certain advertising expenses which are not considered separate performance obligations are recorded as sales discounts. All other cooperative advertising expenses are recorded in SG&A. Multiple Performance Obligations. The Company enters into contracts with customers for its wearable technology that include multiple performance obligations. Each distinct performance obligation was determined by whether the customer could benefit from the good or service on its own or together with readily available resources. The Company allocates revenue to each performance obligation based on its relative standalone selling price. The Company's process for determining standalone selling price considers multiple factors including the Company's internal pricing model and market trends that may vary depending upon the facts and circumstances related to each performance obligation. Revenue allocated to the hardware and software essential to the functionality of the product represents the majority of the arrangement consideration and is recognized at the time of product delivery, provided the other conditions for revenue recognition have been met. Revenue allocated to free software services provided through the Company's online dashboard and mobile apps as well as revenue allocated to the right to receive future unspecified software updates is deferred and recognized on a straight-line basis over the product's estimated usage period of two years. Licensing Income. The Company entered into agreements with certain customers to provide smartwatch technology, design and support. The Company also has an agreement to procure smartwatches for a customer. Disaggregation of Revenue. The Company's revenue disaggregated by major product category and timing of revenue recognition was as follows (in thousands): Fiscal Year 2020 Americas Europe Asia Corporate Total Product Type Watches $ 507,278 $ 404,520 $ 388,004 $ 44 $ 1,299,846 Leathers 104,621 36,570 32,430 — 173,621 Jewelry 23,959 71,209 7,749 — 102,917 Other 6,355 10,065 6,168 14,371 36,959 Consolidated $ 642,213 $ 522,364 $ 434,351 $ 14,415 $ 1,613,343 Timing of Revenue Recognition Revenue recognized at a point in time $ 639,948 $ 520,878 $ 433,648 $ 5,451 $ 1,599,925 Revenue recognized over time 2,265 1,486 703 8,964 13,418 Consolidated $ 642,213 $ 522,364 $ 434,351 $ 14,415 $ 1,613,343 Fiscal Year 2019 Americas Europe Asia Corporate Total Product Type Watches $ 769,581 $ 557,460 $ 475,361 $ 79 $ 1,802,481 Leathers 145,632 47,308 45,679 — 238,619 Jewelry 24,826 92,935 5,416 — 123,177 Other 9,926 17,791 8,700 17,018 53,435 Consolidated $ 949,965 $ 715,494 $ 535,156 $ 17,097 $ 2,217,712 Timing of Revenue Recognition Revenue recognized at a point in time $ 947,353 $ 714,056 $ 534,403 $ 6,145 $ 2,201,957 Revenue recognized over time 2,612 1,438 753 10,952 15,755 Consolidated $ 949,965 $ 715,494 $ 535,156 $ 17,097 $ 2,217,712 Fiscal Year 2018 Americas Europe Asia Corporate Total Product Type Watches $ 936,875 $ 656,948 $ 439,029 $ 169 $ 2,033,021 Leathers 171,808 67,264 50,313 — 289,385 Jewelry 50,266 111,603 5,906 — 167,775 Other 15,558 20,476 10,225 5,048 51,307 Consolidated $ 1,174,507 $ 856,291 $ 505,473 $ 5,217 $ 2,541,488 Timing of Revenue Recognition Revenue recognized at a point in time $ 1,172,200 $ 855,219 $ 504,956 $ 4,477 $ 2,536,852 Revenue recognized over time 2,307 1,072 517 740 4,636 Consolidated $ 1,174,507 $ 856,291 $ 505,473 $ 5,217 $ 2,541,488 Contract Balances. As of January 2, 2021, the Company had no material contract assets on the consolidated balance sheets and no deferred contract costs. The Company had contract liabilities of (i) $9.9 million and $13.4 million as of January 2, 2021 and December 28, 2019, respectively, related to remaining performance obligations on licensing income, (ii) $4.6 million and $5.3 million as of January 2, 2021 and December 28, 2019, respectively, primarily related to remaining performance obligations on wearable technology products and (iii) $4.2 million and $3.3 million as of January 2, 2021 and December 28, 2019, respectively, related to gift cards issued. Shipping and Handling Fees. The Company accounts for shipping and handling activities that occur after control of the related good transfers as fulfillment activities instead of assessing such activities as performance obligations. |
Inventories
Inventories | 12 Months Ended |
Jan. 02, 2021 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories consisted of the following (in thousands): At Fiscal Year End 2020 2019 Components and parts $ 25,016 $ 35,626 Work-in-process 7,913 11,034 Finished goods 262,367 405,618 Inventories $ 295,296 $ 452,278 |
Warranty Liabilities
Warranty Liabilities | 12 Months Ended |
Jan. 02, 2021 | |
Product Warranties Disclosures [Abstract] | |
Warranty Liabilities | Warranty Liabilities The Company's warranty liabilities are primarily related to watch products and are included in accrued expenses—other in the consolidated balance sheets. The Company's watch products are covered by limited warranties against defects in materials or workmanship. Historically, the Company's FOSSIL ® and RELIC ® watch products sold in the U.S. have been covered for warranty periods of 11 years and 12 years, respectively, and SKAGEN brand watches have been covered by a lifetime warranty. Beginning in 2017, these brands are covered by a two year warranty. Generally, all other products sold in the U.S. and internationally are covered by a comparable one to two year warranty. The Company's warranty liability is estimated using historical warranty repair expense. As changes occur in sales volumes and warranty costs, the warranty accrual is adjusted as necessary. Due to the nature of connected products, their warranty costs are usually more than traditional products. A shift in product mix from traditional to connected products generally results in an increase in the Company's warranty liabilities. Warranty liability activity consisted of the following (in thousands): Fiscal Year 2020 2019 2018 Beginning balance $ 23,095 $ 22,807 $ 19,405 Settlements in cash or kind (14,843) (18,073) (15,197) Warranties issued and adjustments to preexisting warranties (1) 13,664 18,361 18,599 Ending balance $ 21,916 $ 23,095 $ 22,807 ____________________________________________ (1) Changes in cost estimates related to preexisting warranties are aggregated with accruals for new standard warranties issued and foreign currency changes. |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 12 Months Ended |
Jan. 02, 2021 | |
Prepaid Expense and Other Assets, Current [Abstract] | |
Prepaid Expenses and Other Current Assets | Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following (in thousands): At Fiscal Year End 2020 2019 Prepaid royalties $ 24,391 $ 22,258 Prepaid taxes 27,280 34,712 Current income tax receivable 37,674 — Other receivables 8,230 10,581 Forward contracts 345 3,327 Inventory returns 16,650 22,402 Property held for sale 10,359 — Short term deposits 1,238 1,530 Other 23,200 22,408 Prepaid expenses and other current assets $ 149,367 $ 117,218 |
Property, Plant and Equipment
Property, Plant and Equipment | 12 Months Ended |
Jan. 02, 2021 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Property, Plant and Equipment Property, plant and equipment—net consisted of the following (in thousands): At Fiscal Year End 2020 2019 Land $ 5,833 $ 7,579 Buildings 31,474 37,012 Machinery and equipment 41,327 39,756 Furniture and fixtures 93,423 96,940 Computer equipment and software 225,352 235,757 Leasehold improvements 182,169 192,114 Construction in progress 1,623 7,255 581,201 616,413 Less accumulated depreciation and amortization 467,175 464,913 Property, plant and equipment-net $ 114,026 $ 151,500 |
Intangible and Other Assets
Intangible and Other Assets | 12 Months Ended |
Jan. 02, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible and Other Assets | Intangible and Other Assets Intangible and other assets-net consisted of the following (in thousands): 2020 2019 At Fiscal Year End Useful Gross Accumulated Gross Accumulated Intangibles-subject to amortization: Trademarks 10 yrs. $ 3,775 $ 3,198 $ 3,612 $ 2,993 Customer lists 5 - 10 yrs. 42,387 39,406 52,517 44,013 Patents 3 - 20 yrs. 2,371 1,973 2,308 1,937 Developed technology 7 yrs. 2,193 1,097 2,193 548 Trade name 6 yrs. 4,502 938 4,502 188 Other 7 - 20 yrs. 544 301 383 272 Total intangibles-subject to amortization 55,772 46,913 65,515 49,951 Intangibles-not subject to amortization: Trade names 8,895 11,315 Other assets: Other deposits 19,762 18,558 Deferred compensation plan assets 6,257 5,243 Deferred tax asset-net 33,893 38,275 Restricted cash 8,159 7,501 Tax receivable 58,734 6,507 Investments 327 500 Other 2,303 2,145 Total other assets 129,435 78,729 Total intangible and other assets $ 194,102 $ 46,913 $ 155,559 $ 49,951 Total intangible and other assets-net $ 147,189 $ 105,608 Amortization expense for intangible assets was approximately $7.1 million for both fiscal years 2020 and 2019 and $11.9 million for fiscal year 2018. Estimated aggregate future amortization expense by fiscal year for intangible assets is as follows (in thousands): Fiscal Year Amortization 2021 $ 3,384 2022 2,531 2023 909 2024 896 2025 1,139 |
Derivatives and Risk Management
Derivatives and Risk Management | 12 Months Ended |
Jan. 02, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivatives and Risk Management | Derivatives and Risk Management Cash Flow Hedges. The primary risks managed by using derivative instruments are the fluctuations in global currencies that will ultimately be used by non-U.S. dollar functional currency subsidiaries to settle future payments of intercompany inventory transactions denominated in U.S. dollars. Specifically, the Company projects future intercompany purchases by its non-U.S. dollar functional currency subsidiaries generally over a period of up to 24 months. The Company enters into forward contracts generally for up to 85% of its forecasted purchases to manage fluctuations in global currencies that will ultimately be used to settle such U.S. dollar denominated inventory purchases. Additionally, the Company enters into forward contracts to manage fluctuations in Japanese yen exchange rates that will be used to settle future third-party inventory component purchases by a U.S. dollar functional currency subsidiary. Forward contracts represent agreements to exchange the currency of one country for the currency of another country at an agreed-upon settlement date and exchange rate. These forward contracts are designated as single cash flow hedges. Fluctuations in exchange rates will either increase or decrease the Company’s U.S. dollar equivalent cash flows from these inventory transactions, which will affect the Company’s U.S. dollar earnings. Gains or losses on the forward contracts are expected to offset these fluctuations to the extent the cash flows are hedged by the forward contracts. These forward contracts meet the criteria for hedge accounting, which requires that they represent foreign currency-denominated forecasted transactions in which (i) the operating unit that has the foreign currency exposure is a party to the hedging instrument and (ii) the hedged transaction is denominated in a currency other than the hedging unit's functional currency. At the inception of each forward contract designated as a cash flow hedge, the hedging relationship is expected to be highly effective in achieving offsetting cash flows attributable to the hedged risk. The Company assesses hedge effectiveness under the critical terms matched method at inception and at least quarterly throughout the life of the hedging relationship. If the critical terms (i.e., amounts, currencies and settlement dates) of the forward contract match the terms of the forecasted transaction, the Company concludes that the hedge is effective. Hedge accounting is discontinued if it is determined that the derivative is not highly effective. For a derivative instrument that is designated and qualifies as a cash flow hedge, the gain or loss on the derivative is reported as a component of other comprehensive income (loss), net of taxes and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. All derivative instruments are recognized as either assets or liabilities at fair value in the consolidated balance sheets. The Company records all forward contract hedge assets and liabilities on a gross basis as they do not meet the balance sheet netting criteria because the Company does not have master netting agreements established with the derivative counterparties that would allow for net settlement. Derivatives designated as cash flow hedges are recorded at fair value at each balance sheet date and the change in fair value is recorded to accumulated other comprehensive income (loss) within the equity section of the Company's consolidated balance sheets until such derivative's gains or losses become realized or the cash flow hedge relationship is terminated. Hedge accounting must be discontinued for a cash flow hedge of a forecasted transaction upon determining that it is no longer probable that the forecasted transaction will occur within the period originally specified at hedge inception. The cumulative hedge accounting gain or loss associated with the discontinued hedge would remain in accumulated other comprehensive income (loss), and would be reclassified into earnings when the forecasted transaction affects earnings, unless it is probable that the forecasted transaction will not occur by the end of the originally specified time period or within an additional two-month period of time thereafter. In that case, the entire amount recorded in accumulated other comprehensive income (loss) would immediately be reclassified into earnings. However, in rare cases, the existence of extenuating circumstances that are related to the nature of the forecasted transaction and are outside the control or influence of the Company may cause the forecasted transaction to be probable of occurring on a date that is beyond the additional two-month period of time, in which case the net derivative instrument gain or loss related to the discontinued cash flow hedge will continue to be reported in accumulated other comprehensive income (loss) until it is reclassified into earnings. The Company has identified some delays in the timing of forecasted inventory transactions and has applied the extenuating case exception since the delays are attributable to the COVID-19 pandemic. The Company determined that the delayed forecasted transactions are still probable of occurring after the additional two-month period, and therefore will retain the amounts associated with the discontinued cash flow hedge in accumulated other comprehensive income (loss) until the forecasted transaction affects earnings. If the cash flow hedge relationship is terminated, the derivative's gains or losses that are recorded in accumulated other comprehensive income (loss) will be immediately recognized in earnings. There were no gains or losses reclassified into earnings as a result of the discontinuance of cash flow hedges for fiscal years 2020, 2019 or 2018. As of January 2, 2021, the Company had the following outstanding forward contracts designated as cash flow hedges that were entered into to hedge the future payments of intercompany inventory transactions (in millions): Functional Currency Contract Currency Type Amount Type Amount Euro 81.3 U.S. dollar 98.2 Canadian dollar 22.0 U.S. dollar 17.1 British pound 8.8 U.S. dollar 11.8 Mexican peso 218.8 U.S. dollar 10.9 Japanese yen 985.6 U.S. dollar 9.5 Australian dollar 7.2 U.S. dollar 5.5 U.S. dollar 3.2 Japanese Yen 345.0 Non-designated Hedges. The Company also periodically enters into forward contracts to manage exchange rate risks associated with certain intercompany transactions and for which the Company does not elect hedge accounting treatment. As of January 2, 2021, the Company had non-designated forward contracts of $1.4 million on 21.9 million rand, and as of December 28, 2019, the Company had non-designated forward contracts of $1.5 million on 22.6 million rand associated with a South African rand-denominated foreign subsidiary. Changes in the fair value of derivatives not designated as hedging instruments are recognized in earnings when they occur. The effective portion of gains and losses on cash flow hedges that were recognized in other comprehensive income (loss), net of taxes during fiscal years 2020, 2019 and 2018 are set forth below (in thousands): Fiscal Year 2020 2019 2018 Cash flow hedges: Forward contracts $ 2,217 $ 6,060 $ 18,044 Total gain (loss) recognized in other comprehensive income (loss), net of taxes $ 2,217 $ 6,060 $ 18,044 The following table illustrates the effective portion of gains and losses on derivative instruments recorded in other comprehensive income (loss), net of taxes during the term of the hedging relationship and reclassified into earnings, and gains and losses on derivatives not designated as hedging instruments recorded directly to earnings during fiscal years 2020, 2019 and 2018 (in thousands): Derivative Instruments Consolidated Effect of Derivative Fiscal Year 2020 Fiscal Year 2019 Fiscal Year 2018 Forward contracts designated as cash flow hedging instruments Cost of sales Total gain (loss) reclassified from accumulated other comprehensive income (loss) $ 3,748 $ 9,939 $ — Forward contracts designated as cash flow hedging instruments Other income (expense)-net Total gain (loss) reclassified from accumulated other comprehensive income (loss) $ 602 $ 1,720 $ (2,629) Forward contracts not designated as hedging instruments Other income (expense)-net Total gain (loss) recognized in income $ (113) $ (88) $ 244 Interest rate swap not designated as a cash flow hedging instrument Other income (expense)-net Total gain (loss) recognized in income $ — $ — $ 67 The following table discloses the fair value amounts for the Company's derivative instruments as separate asset and liability values, presents the fair value of derivative instruments on a gross basis, and identifies the line items in the consolidated balance sheets in which the fair value amounts for these categories of derivative instruments are included (in thousands): Asset Derivatives Liability Derivatives January 2, 2021 December 28, 2019 January 2, 2021 December 28, 2019 Consolidated Fair Value Consolidated Fair Value Consolidated Fair Value Consolidated Fair Value Forward contracts designated as cash flow hedging instruments Prepaid expenses and other current assets $ 345 Prepaid expenses and other current assets $ 3,327 Accrued expenses-other $ 2,178 Accrued expenses-other $ 1,657 Forward contracts not designated as cash flow hedging instruments Prepaid expenses and other current assets — Prepaid expenses and other current assets — Accrued expenses-other 86 Accrued expenses-other 63 Forward contracts designated as cash flow hedging instruments Intangible and other assets-net 48 Intangible and other assets-net 21 Other long-term liabilities 35 Other long-term liabilities 104 Total $ 393 $ 3,348 $ 2,299 $ 1,824 The following table summarizes the effects of the Company's derivative instruments on earnings (in thousands): Effect of Derivative Instruments Fiscal Year 2020 Fiscal Year 2019 Cost of Sales Other Income (Expense)-net Cost of Sales Other Income (Expense)-net Total amounts of income and expense line items presented in the consolidated statements of income (loss) and comprehensive income (loss) in which the effects of cash flow hedges are recorded $ 842,987 $ (4,828) $ 1,118,274 $ 26,984 Gain (loss) on cash flow hedging relationships: Forward contracts designated as cash flow hedging instruments: Total gain (loss) reclassified from other comprehensive income (loss) 3,748 602 9,939 1,720 Forward contracts not designated as cash flow hedging instruments: Total gain (loss) recognized in income — (113) — (88) |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Jan. 02, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The Company defines fair value as the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. ASC 820, Fair Value Measurement and Disclosures ("ASC 820"), establishes a fair value hierarchy, which prioritizes the inputs used in measuring fair value into three broad levels as follows: • Level 1—Quoted prices in active markets for identical assets or liabilities. • Level 2—Inputs, other than quoted prices in active markets, that are observable either directly or indirectly. • Level 3—Unobservable inputs based on the Company's assumptions. ASC 820 requires the use of observable market data if such data is available without undue cost and effort. The following table presents the fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis as of January 2, 2021 (in thousands): Fair Value at January 2, 2021 Level 1 Level 2 Level 3 Total Assets: Forward contracts $ — $ 393 $ — $ 393 Deferred compensation plan assets: Investment in publicly traded mutual funds 6,257 — — 6,257 Total $ 6,257 $ 393 $ — $ 6,650 Liabilities: Contingent consideration $ — $ — $ 1,924 $ 1,924 Forward contracts — 2,299 — 2,299 Total $ — $ 2,299 $ 1,924 $ 4,223 The following table presents the fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis as of December 28, 2019 (in thousands): Fair Value at December 28, 2019 Level 1 Level 2 Level 3 Total Assets: Forward contracts $ — $ 3,348 $ — $ 3,348 Deferred compensation plan assets: Investment in publicly traded mutual funds 5,243 — — 5,243 Total $ 5,243 $ 3,348 $ — $ 8,591 Liabilities: Contingent consideration $ — $ — $ 1,141 $ 1,141 Forward contracts — 1,824 — 1,824 Total $ — $ 1,824 $ 1,141 $ 2,965 The fair values of the Company's deferred compensation plan assets are based on quoted prices. The deferred compensation plan assets are recorded in intangible and other assets—net in the Company's consolidated balance sheets. The fair values of the Company's forward contracts are based on published quotations of spot currency rates and forward points, which are converted into implied forward currency rates. As of January 2, 2021 and December 28, 2019, the fair value of the Company's debt approximated its carrying amount. The fair value of debt was obtained using observable market inputs. Operating lease right-of-use assets with a carrying amount of $49.6 million and property, plant and equipment—net with a carrying amount of $7.5 million related to retail store leasehold improvements, fixturing and shop-in-shops were written down to a fair value of $19.4 million and $2.4 million, respectively, resulting in total pre-tax impairment charges of $35.3 million for fiscal year 2020. The fair values of operating lease right-of-use assets and fixed assets related to retail stores were determined using Level 3 inputs, including forecasted cash flows and discount rates. Of the $35.3 million impairment expense, $23.0 million, $7.3 million and $1.0 million were recorded in SG&A in the Americas, Europe and Asia segments, respectively, and $2.3 million, $0.9 million, and $0.8 million were recorded in restructuring charges in the Americas, Europe and Asia segments, respectively. In fiscal year 2019, operating lease right-of-use assets with a carrying amount of $18.3 million and property, plant and equipment—net with a carrying amount of $1.8 million related to retail store leasehold improvements, fixturing and shop-in-shops were written down to a fair value of $8.7 million and $0.5 million, respectively, resulting in total pre-tax impairment charges of $10.9 million. The fair value of trade names are measured on a non-recurring basis using Level 3 inputs, including forecasted cash flows, discounts rates and implied royalty rates. Trade name impairment charges are recorded in the Corporate cost area. See Note 1—Significant Accounting Policies for additional disclosures about trade name impairment. In fiscal year 2020, the MICHELE trade name with a carrying amount of $10.9 million was written down to its implied fair value of $8.4 million, resulting in a pre-tax impairment charge of $2.5 million. The trade name impairment was recorded to the Corporate cost area. In fiscal year 2019, the SKAGEN trade name with a carrying amount of $21.1 million was written down to its implied fair value of $4.5 million, resulting in a pre-tax impairment charge of $16.6 million. The fair value of the contingent consideration liability related to Fossil Accessories South Africa Pty. Ltd. (‘‘Fossil South Africa’’) was determined using Level 3 inputs. The contingent consideration is based on Fossil South Africa's projected earnings and dividends. The present value of the contingent consideration liability was valued at $1.9 million as of January 2, 2021. The Company recorded $0.1 million of the variable consideration in accrued expenses-other and $1.8 million in other long-term liabilities in the consolidated balance sheets at January 2, 2021. |
Debt
Debt | 12 Months Ended |
Jan. 02, 2021 | |
Debt Disclosure [Abstract] | |
Debt | Debt The Company's debt consisted of the following, excluding finance lease obligations, (in millions): January 2, 2021 December 28, 2019 Revolving facility (1) $ 98.3 $ 28.0 U.S. term loan (2) 152.0 200.0 Other international 0.5 0.2 Total debt $ 250.8 $ 228.2 Less current portion 40.5 25.2 Long-term debt $ 210.3 $ 203.0 ___________________________________________ (1) Excludes debt issuance costs of $6.2 million and $7.9 million at January 2, 2021 and December 28, 2019, respectively. (2) Excludes debt issuance costs and original issue discount of $11.4 million and $7.4 million, respectively at January 2, 2021. Excludes debt issuance costs and original issue discount of $6.6 million and $11.2 million, respectively at December 28, 2019. U.S.-Based. On September 26, 2019, the Company and Fossil Partners L.P., as the U.S. borrowers (the “U.S. Borrowers”), and Fossil Group Europe GmbH (the “Swiss Borrower”), Fossil Asia Pacific Limited (the “Hong Kong Borrower”), Fossil (Europe) GmbH (the “German Borrower”), Fossil (UK) Limited (the “UK Borrower”) and Fossil Canada Inc. (the “Canadian Borrower”), as the non-U.S. borrowers, certain other subsidiaries of the Company from time to time party thereto designated as borrowers (such subsidiaries, together with the U.S. Borrowers, the Swiss Borrower, the Hong Kong Borrower, the German Borrower, the UK Borrower and the Canadian Borrower, the “ABL Borrowers”), and certain subsidiaries of the Company from time to time party thereto as guarantors, entered into an asset-based revolving credit agreement (the “Revolving Facility”) with JPMorgan Chase Bank, N.A. as administrative agent (the “ABL Agent”), J.P. Morgan AG, as French collateral agent, JPMorgan Chase Bank, N.A., Citizens Bank, N.A. and Wells Fargo Bank, National Association as joint bookrunners and joint lead arrangers, and Citizens Bank, N.A. and Wells Fargo Bank, National Association, as co-syndication agents and each of the lenders from time to time party thereto (the “ABL Lenders”). In addition, on September 26, 2019, the Company, as borrower, entered into a term credit agreement (the "Term Credit Agreement") with JPMorgan Chase Bank, N.A. as administrative agent (the “Term Agent”), JPMorgan Chase Bank, N.A., Citizens Bank, National Association and Wells Fargo Securities, LLC, as joint bookrunners and joint lead arrangers and the lenders party thereto (the “Term Loan Lenders”). The Revolving Facility provides that the ABL Lenders may extend revolving loans in an aggregate principal amount not to exceed $275.0 million at any time outstanding (the “Revolving Credit Commitment”), of which up to $160.0 million is available under a U.S. facility, an aggregate of $70.0 million is available under a European facility, $30.0 million is available under a Hong Kong facility, $10.0 million will be available under a French facility, and $5.0 million is available under a Canadian facility, in each case, subject to the borrowing base availability limitations described below. The Revolving Facility also includes an up to $45.0 million subfacility for the issuance of letters of credit (the “Letters of Credit”). The Revolving Facility expires and is due and payable on September 26, 2024, provided that, if on the date that is the 121st day prior to the final maturity date of any class or tranche of term loans under the Term Credit Agreement, any such term loans are outstanding on such date, then the maturity date of the Revolving Facility shall be such date. Unless the maturity of the term loans is extended beyond the current maturity date of September 26, 2024, the Revolving Facility will expire and be due and payable on May 28, 2024. The French facility includes a $1.0 million subfacility for swingline loans, and the European facility includes a $7.0 million subfacility for swingline loans. The Revolving Facility is subject to a line cap (the “Line Cap”) equal to the lesser of the total Revolving Credit Commitment and the aggregate borrowing bases under the U.S. facility, the European facility, the Hong Kong facility, the French facility and the Canadian facility. Loans under the Revolving Facility may be made in U.S. dollars, Canadian dollars, euros, Hong Kong dollars or pounds sterling. The Revolving Facility is an asset-based facility, in which borrowing availability is subject to a borrowing base equal to: (a) with respect to the Company, the sum of (i) the lesser of (x) 90% of the appraised net orderly liquidation value of eligible U.S. finished goods inventory and (y) 65% of the lower of cost or market value of eligible U.S. finished goods inventory, plus (ii) 85% of the eligible U.S. accounts receivable, plus (iii) 90% of eligible U.S. credit card accounts receivable, minus (iv) the aggregate amount of reserves, if any, established by the ABL Agent; (b) with respect to each non-U.S. borrower (except for the French Borrower), the sum of (i) the lesser of (x) 90% of the appraised net orderly liquidation value of eligible foreign finished goods inventory of such non-U.S. borrower and (y) 65% of the lower of cost or market value of eligible foreign finished goods inventory of such non-U.S. borrower, plus (ii) 85% of the eligible foreign accounts receivable of such non-U.S. borrower, minus (iii) the aggregate amount of reserves, if any, established by the ABL Agent; and (c) with respect to the French Borrower, (i) 85% of eligible French accounts receivable minus (ii) the aggregate amount of reserves, if any, established by the ABL Agent. Not more than 60% of the aggregate borrowing base under the Revolving Facility may consist of the non-U.S. borrowing bases. The Revolving Facility also includes a commitment fee, payable quarterly in arrears, of 0.250% or 0.375% determined by reference to the average daily unused portion of the overall commitment under the Revolving Facility. The ABL Borrowers will pay the ABL Agent, on the account of the issuing ABL Lenders, an issuance fee of 0.125% for any issued Letters of Credit. The Term Credit Agreement provides for term loans to the Company in the aggregate principal amount of $200 million. Proceeds from the Term Credit Agreement were reduced by a $12.0 million original issue discount, which is presented as a reduction of the Term Credit Agreement on the Company's consolidated balance sheet and is being amortized to interest expense over the life of the term loan. On February 20, 2020, pursuant to the terms of the Amendment No. 1 (the "First Amendment"), the Company, the administrative agent and the ABL lenders agreed to modify certain terms of the Term Credit Agreement to, among other things, (i) increase the interest rate applicable to the term loans under the Term Credit Agreement (a) in the case of Eurodollar loans, from the adjusted LIBO rate plus 6.50% to the adjusted LIBO rate plus 8.00%, and (b) in the case of alternate base rate loans, from the alternate base rate plus 5.50% to the alternate base rate plus 7.00%; (ii) increase the maximum total leverage ratio permitted from 1.50 to 1.00 as of the last day of each fiscal quarter to (a) 2.75 to 1.00 as of the last day of each fiscal quarter ending April 4, 2020, July 4, 2020, October 3, 2020 and January 2, 2021, (b) 2.25 to 1.00 as of the last day of each fiscal quarter ending April 3, 2021, July 3, 2021 and October 2, 2021, and (c) 1.50 to 1.00 as of the last day of each subsequent fiscal quarter; (iii) limit the amount of borrowings in aggregate principal amount at any time outstanding under the Revolving Facility, to the lesser of the borrowing base thereunder and $200 million; (iv) extend the applicable periods for certain prepayment fees, so that if the Company voluntarily prepays the term loans prior to February 20, 2022, or if the Company incurs certain indebtedness which results in a mandatory prepayment under the Term Credit Agreement prior to February 20, 2022, the Company is required to pay a prepayment fee of 2.00% with respect to the principal amount prepaid prior to February 20, 2021 and 1.00% with respect to the principal amount prepaid between February 21, 2021 and February 20, 2022; and (v) require the Company to pay the foregoing prepayment fee upon acceleration of the loans under the Term Credit Agreement. The First Amendment also modified the negative covenants and events of default in the Term Credit Agreement to reduce the Company’s flexibility with respect to certain matters. The Company incurred debt issue costs of $8.1 million in connection with the First Amendment. On May 12, 2020, the Company entered into Amendment No. 2 to the Term Credit Agreement to extend the deadline for delivery of the Company’s unaudited quarterly financial statements and related deliverables for the fiscal quarter ended April 4, 2020 to the earlier of (i) July 6, 2020 and (ii) the date on which the Company was required to file with the SEC its quarterly report on Form 10-Q for the fiscal quarter ended April 4, 2020. On June 5, 2020, the Company entered into Amendment No. 3 (the “Third Amendment”) to the Term Credit Agreement to modify certain terms of the Term Credit Agreement to, among other things, (i) increase the interest rate applicable to the term loans under the Term Credit Agreement (a) in the case of Eurodollar loans, from the adjusted LIBO rate plus 8.00% to the adjusted LIBO rate plus 8.50%, and (b) in the case of alternate base rate loans, from the alternate base rate plus 7.00% to the alternate base rate plus 7.50%; (ii) (a) require a $15.0 million principal prepayment at the time of the Third Amendment, (b) increase the quarterly amortization payment to be paid on September 30, 2020 to $8.0 million from $5.0 million, and (c) increase each quarterly amortization payment thereafter to $10.0 million; (iii) change provisions related to prepayment fees such that (a) prepayment fees will be waived for a period of 90 days following the date of the Third Amendment for prepayments in connection with certain refinancings of the term loans and (b) prepayment fees will be 2% for a period of twelve months after such 90-day period, and 1% for next twelve-month period; (iv) reduce the minimum liquidity levels required to be maintained by the Company at the end of each fiscal month, through and including November 2020, from $150.0 million to $125.0 million; (v) waive the quarterly test for maximum total leverage ratio for fiscal year 2020 and the first three fiscal quarters of fiscal year 2021, and during such period require the Company to maintain specified minimum levels of EBITDA; and (vi) increase the amount of equity interests in certain “first tier” foreign subsidiaries that must be pledged as collateral securing the obligations under the Term Credit Agreement from 65% to 100% of such equity interests. While the Third Amendment amended, among other things, certain of the financial covenants in the Term Credit Agreement to address the financial impact of COVID-19, any material further decreases to the Company’s revenues and cash flows, or the Company's inability to successfully achieve its cost reduction targets, could result in the Company not meeting one or more of the amended financial covenants under its Term Credit Agreement within the next twelve months. The Term Credit Agreement requires an additional payment of $12.0 million in the first quarter in the fiscal year ending January 1, 2022 as an excess cash payment as calculated under the Term Credit Agreement. This payment is applied to reduce the subsequent scheduled repayment. The ABL Borrowers have the right to request an increase to the commitments under the Revolving Facility or any subfacility in an aggregate principal amount not to exceed $75.0 million in increments no less than $10.0 million, subject to certain terms and conditions as defined in the Revolving Facility, including that the Term Credit Agreement has been amended, restated or otherwise modified to permit any additional commitments. The Revolving Facility is secured by guarantees by the Company and certain of its domestic subsidiaries. Additionally, the Company and such subsidiaries have granted liens on all or substantially all of their assets in order to secure the obligations under the Revolving Facility. In addition, the Swiss Borrower, the Hong Kong Borrower, the German Borrower and the Canadian Borrower, and the other non-U.S. borrowers from time to time party to the Revolving Facility are required to enter into security instruments with respect to all or substantially all of their assets that can be pledged under applicable local law, and certain of their respective subsidiaries may guarantee the respective non-U.S. obligations under the Revolving Facility. The Revolving Facility contains customary affirmative and negative covenants and events of default, such as compliance with annual audited and quarterly unaudited financial statements disclosures. Upon an event of default, the ABL Agent will have the right to declare the revolving loans and other obligations outstanding immediately due and payable and all commitments immediately terminated or reduced, subject to cure periods and grace periods set forth in the Revolving Facility. A payment default under the Revolving Facility triggers a cross default under the Term Credit Agreement. The Term Credit Agreement is secured by guarantees by the Company and certain of its Company’s domestic subsidiaries. Additionally, the Company and such subsidiaries have granted liens on all or substantially all of their assets in order to secure the obligations under the Term Credit Agreement. The Term Credit Agreement contains customary affirmative and negative covenants and events of default such as compliance with annual audited and quarterly unaudited financial statements disclosures. Upon an event of default, the Term Agent will have the right to declare the term loans and other obligations outstanding immediately due and payable and all commitments immediately terminated or reduced, subject to cure periods and grace periods set forth in the Term Credit Agreement. The obligations under the Revolving Facility and the Term Credit Agreement are governed by a customary intercreditor agreement (the “Intercreditor Agreement”). The Intercreditor Agreement specifies that (i) the Term Credit Agreement is secured by (a) a perfected first priority security interest in U.S. fixed assets and (b) a perfected second priority security interest in the U.S. liquid assets and accounts receivable, and (ii) the Revolving Facility is secured by (a) a perfected first priority security interest in the U.S. liquid assets and accounts receivable and (b) a perfected second priority security interest in U.S. fixed assets. During fiscal year 2020, the Company had net payments of $48.0 million under the Term Credit Agreement. The Company had net borrowings of $70.3 million under the Revolving Facility during fiscal year 2020. Amounts available under the Revolving Facility were reduced by any amounts outstanding under standby Letters of Credit. As of January 2, 2021, the Company had available borrowing capacity of approximately $42.1 million under the Revolving Facility. The Company incurred approximately $17.6 million of interest expense under the Term Credit Agreement during fiscal year 2020. The Company incurred approximately $1.9 million of interest expense under the Revolving Facility during fiscal year 2020. The Company incurred approximately $10.6 million of interest expense related to the amortization of debt issuance costs and the original issue discount during fiscal year 2020. At January 2, 2021, the Company was in compliance with all debt covenants related to the Company's debt agreements. Foreign-Based. Fossil South Africa entered into a 25 million South African rand short-term note with First National Bank (the "Fossil South Africa Note") that is used for working capital purposes. The Fossil South Africa Note bears interest at the bank's prime rate, 7.00% as of year end 2020. The Fossil South Africa note is reviewed annually for renewal. South African rand-based borrowings, in U.S. dollars, under the Fossil South Africa Note were approximately $0.5 million as of January 2, 2021 . The Company's debt as of January 2, 2021, excluding finance lease obligations, matures as follows (in millions): Less than 1 Year $ 40.5 Year 2 40.0 Year 3 30.0 Year 4 140.3 Principal amounts repayable 250.8 Debt issuance costs (17.6) Original issue discount (7.4) Total debt outstanding $ 225.8 |
Other Income (Expense)_Net
Other Income (Expense)—Net | 12 Months Ended |
Jan. 02, 2021 | |
Other Income and Expenses [Abstract] | |
Other Income (Expense)—Net | Other Income (Expense)—Net Other income (expense)—net consisted of the following (in thousands): Fiscal Year 2020 2019 2018 Interest income $ 573 $ 2,075 $ 2,605 Contingent consideration remeasurement (628) 601 3,381 Equity in losses of unconsolidated investment (345) (371) (558) Extinguishment of debt — (3,044) (718) Gain on asset divestitures — 23,134 — Net currency (losses) gains (6,481) 3,932 (5,820) Other net gains 2,053 657 1,072 Other income (expense) - net $ (4,828) $ 26,984 $ (38) |
Taxes
Taxes | 12 Months Ended |
Jan. 02, 2021 | |
Income Tax Disclosure [Abstract] | |
Taxes | Taxes Income Taxes. Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the consolidated deferred tax assets and liabilities were (in thousands): Fiscal Year 2020 2019 Deferred income tax assets: Inventory 4,095 6,856 Compensation 14,028 11,998 Property, plant and equipment — 220 Trade names and customer lists 5,163 4,345 Goodwill 13,189 14,947 Foreign accruals 12,582 10,446 Loss carryforwards 54,112 32,158 Tax credit carryforwards 2,771 4,281 Interest disallowance 9,604 16,683 Lease liabilities 54,857 82,511 Other 19,042 36,302 Deferred income tax assets total $ 189,443 $ 220,747 Deferred income tax liabilities: Property, plant and equipment (5,807) — Undistributed earnings of certain foreign subsidiaries (3,076) (329) Right-of-use assets (36,584) (65,070) Other (1,327) (1,081) Deferred income tax liabilities total $ (46,794) $ (66,480) Valuation allowance (109,250) (118,089) Net deferred income tax assets $ 33,399 $ 36,178 Net deferred income tax assets $ 33,894 $ 38,275 Net deferred income tax liabilities (495) (2,097) Net deferred income tax assets $ 33,399 $ 36,178 Operating Loss Carryforwards. At January 2, 2021, the consolidated balance sheets included $45.3 million of deferred tax assets for net operating losses of foreign subsidiaries. The amounts and the fiscal year of expiration of the loss carryforwards are (in thousands): Expires 2021 through 2025 $ 29,990 Expires 2026 through 2030 58,328 Expires 2031 through 2035 — Expires 2036 through 2040 74,314 Indefinite 21,828 Total loss carryforwards $ 184,460 At January 2, 2021, the consolidated balance sheets included $8.8 million of deferred tax assets for state income tax net operating losses. The state apportioned amounts and the fiscal year of expiration of the loss carryforwards are (in thousands): Expires 2021 through 2025 $ 2,567 Expires 2026 through 2030 13,677 Expires 2031 through 2035 16,545 Expires 2036 through 2040 80,377 Indefinite 49,292 Total loss carryforwards $ 162,458 The following table identifies income (loss) before income taxes for the Company's U.S. and non-U.S. based operations for the fiscal years indicated (in thousands): Fiscal Year 2020 2019 2018 U.S $ (163,331) $ (142,141) $ (102,810) Non-U.S (8,652) 110,810 122,980 Total $ (171,983) $ (31,331) $ 20,170 The Company's provision for income taxes consisted of the following for the fiscal years indicated (in thousands): Fiscal Year 2020 2019 2018 Current provision: U.S. federal $ (96,224) $ 2,338 $ (14,386) Non-U.S 16,522 28,109 35,854 State and local (681) (2,330) (2,056) Total current (80,383) 28,117 19,412 Deferred provision (benefit): U.S. federal — — — Non-U.S 4,340 (9,436) 1,696 State and local — — — Total deferred 4,340 (9,436) 1,696 Provision for income taxes $ (76,043) $ 18,681 $ 21,108 A reconciliation of the U.S. federal statutory income tax rates to the Company's effective tax rate is as follows: Fiscal Year 2020 2019 2018 Tax at statutory rate 21.0 % 21.0 % 21.0 % Permanent differences (4.5) (2.0) (0.2) State, net of federal tax benefit (0.1) 17.6 (3.8) Foreign rate differential 1.2 12.8 (12.3) Withholding taxes (1.2) (11.1) 16.3 GILTI tax-net of foreign tax credits 2.1 (24.2) 11.8 U.S. tax on foreign income-net of foreign tax credits 3.9 0.3 6.4 Income tax contingencies 1.6 3.2 (5.0) Valuation allowances (0.4) (53.2) 65.0 Repatriation tax - net impact — — 5.9 Deficiencies on employee stock awards (1.4) (10.9) 10.1 Tax reform rate reduction impact on deferred tax assets — — (15.8) Foreign deferred tax rate change — (4.5) — Non deductible foreign equity awards (0.4) (3.2) 5.3 Non deductible officer compensation 0.7 (3.7) — Tax exempt foreign capital gain income — 6.3 — Deferred adjustment — (8.0) — CARES Act Rate Benefit 21.7 — — Provision for income taxes 44.2 % (59.6) % 104.7 % On March 27, 2020, the U.S. government enacted the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) which included many beneficial income tax provisions including utilization of net operating losses (“NOLs”), temporary changes to the limitation on interest deductions, and technical corrections to tax depreciation for qualified improvement property. The Tax Act had eliminated the option for most taxpayers to carryback a NOL after 2017. A NOL could only be carried forward and was limited to 80% of taxable income. The CARES Act now allows U.S. taxpayers to carryback a NOL arising in tax years 2018, 2019 and 2020 to prior years when the statutory tax rate was 35%. The ability to file for refunds of prior year U.S. tax liabilities and the release of U.S. valuation allowances were the main drivers of the favorable tax rate in 2020. These favorable impacts were partially offset by foreign valuation allowances on NOLs and deferred tax assets. The Company has recorded a short-term tax receivable of $37.7 million for the 2019 tax NOL carryback refund. A long-term tax receivable of $52.3 million was recorded for the 2020 tax NOL carryback refund. The Company records a valuation allowance against its deferred tax assets when recovery of those amounts on a jurisdictional basis is not more likely than not. In addition, the Company's U.S. valuation allowance analysis was reduced by $24.4 million due to the use of deferred tax assets in the NOL carryback as compared to fiscal year 2019 and $4.5 million for the use of deferred tax assets in fiscal year 2020. The Company’s foreign valuation allowance on NOLs and deferred tax assets was increased by $20.2 million as compared to fiscal year 2019. The total valuation allowance of $109.3 million at January 2, 2021 was comprised of $56.0 million and $53.3 million attributable to the U.S. and foreign operations, respectively. The Company will not indefinitely reinvest $260.6 million of previously taxed but undistributed earnings of its foreign subsidiaries as of January 2, 2021. Since under the Tax Act there will be no additional federal income tax when these amounts are repatriated, the Company has only accrued foreign withholding tax and U.S. state income taxes on these earnings with an offsetting valuation allowance. Deferred U.S. federal and state income taxes and foreign taxes are not recorded on the remaining $417.0 million of undistributed earnings of foreign subsidiaries where management plans to continue reinvesting these earnings outside the U.S. As the majority of these earnings have previously been taxed in the U.S., the distribution of the earnings considered indefinitely reinvested would generally be subject only to local country withholding and U.S. state income taxes when distributed, the amount of which is not material. The total amount of unrecognized tax benefits, excluding interest and penalties that would favorably impact the effective tax rate in future periods if recognized, was $31.5 million, $35.7 million and $33.5 million for fiscal years 2020, 2019 and 2018, respectively. The U.S. Internal Revenue Service has completed examinations of the Company's federal income tax returns through 2013. Fiscal years 2016-2019 remain open for federal income tax examination. The Company is also subject to examinations in various state and foreign jurisdictions for its 2011-2019 tax years, none of which the Company believes are significant, individually or in the aggregate. Tax audit outcomes and timing of tax audit settlements are subject to significant uncertainty. The Company has classified uncertain tax positions as long-term income taxes payable unless such amounts are expected to be paid within twelve months from January 2, 2021. As of January 2, 2021, the Company had recorded $15.4 million of unrecognized tax benefits, excluding interest and penalties, for positions that could be settled or not assessed within the next twelve months. Consistent with its past practice, the Company recognizes interest and/or penalties related to income tax overpayments and income tax underpayments in income tax expense and income taxes receivable/payable, respectively. The total amount of accrued income tax-related interest in the Company's consolidated balance sheets was $6.7 million and $4.8 million at January 2, 2021 and December 28, 2019, respectively. The total amount of accrued income tax-related penalties in the Company's consolidated balance sheets was $0.8 million and $1.0 million at January 2, 2021 and December 28, 2019, respectively. The Company accrued income tax-related interest expense of $1.9 million, $1.2 million and $0.8 million in fiscal years 2020, 2019 and 2018, respectively. The following is a tabular reconciliation of the total amounts of unrecognized tax benefits for the fiscal years indicated (in thousands): Fiscal Year 2020 2019 2018 Balance at beginning of year $ 35,676 $ 39,909 $ 35,355 Gross increases—tax positions in prior years 1,241 6,639 7,183 Gross decreases—tax positions in prior years (4,281) (4) (124) Gross increases—tax positions in current year 857 184 576 Settlements — (1,901) — Lapse in statute of limitations (2,255) (8,912) (2,980) Change due to currency revaluation 302 (239) (101) Balance at end of year $ 31,540 $ 35,676 $ 39,909 |
Leases (Notes)
Leases (Notes) | 12 Months Ended |
Jan. 02, 2021 | |
Leases [Abstract] | |
Leases | Leases The Company's leases consist primarily of retail space, offices, warehouses, distribution centers, equipment and vehicles. The Company determines if an agreement contains a lease at inception based on the Company's right to the economic benefits of the leased assets and its right to direct the use of the leased asset. Right-of-use ("ROU") assets represent the Company's right to use an underlying asset, and ROU liabilities represent the Company's obligation to make lease payments arising from the lease. ROU assets and liabilities are recognized at the lease commencement date based on the present value of the lease payments over the lease term. As the Company's leases do not provide an implicit rate, the Company uses its estimated collateralized incremental borrowing rate, which is based on the yield curve for the respective lease terms and adjusted for each lease country to determine the present value of the lease payments. Some leases include one or more options to renew at the Company's discretion, with renewal terms that can extend the lease from one to ten additional years. The renewal options are not included in the measurement of ROU assets and ROU liabilities unless the Company is reasonably certain to exercise the optional renewal periods. Short-term leases are leases having a term of twelve months or less at inception. The Company does not record a related lease asset or liability for short-term leases. The Company has certain leases containing lease and non-lease components which are accounted for as a single lease component. The Company has certain lease agreements where lease payments are based on a percentage of retail sales over contractual levels and others include rental payments adjusted periodically for inflation. The variable portion of these lease payments is not included in the Company's lease liabilities. The Company's lease agreements do not contain any significant restrictions or covenants other than those that are customary in such arrangements. As a result of the COVID-19 pandemic, the Company received lease concessions from landlords in the form of rent deferrals and rent forgiveness. The Company chose the policy election provided by the FASB in April 2020 to record rent concessions as if no modifications to leases contracts were made, and thus no changes to the ROU assets and ROU liabilities were recorded for these concessions. This guidance is only applicable to COVID-19 related lease concessions that do not result in a substantial increase in the rights of the lessor or the obligations of the lessee. As of January 2, 2021, the Company had outstanding deferred rent payments of $5.2 million, and the Company received rent forgiveness of $9.7 million for fiscal year 2020. The components of lease expense were as follows (in thousands): Lease Cost Consolidated Fiscal Year 2020 Fiscal Year 2019 Operating lease cost (1) SG&A $ 106,004 $ 117,932 Finance lease cost: Amortization of ROU assets SG&A $ 506 $ 475 Interest on lease liabilities Interest expense $ 33 $ 38 Short-term lease cost SG&A $ 610 $ 1,302 Variable lease cost SG&A $ 22,048 $ 36,476 _______________________________________________ (1) Includes sublease income, which was immaterial. The following table discloses supplemental balance sheet information for the Company’s leases (in thousands): Leases Consolidated Balance Sheets Location January 2, 2021 December 28, 2019 Assets Operating Operating lease right-of-use assets $ 226,815 $ 288,166 Finance Property, plant and equipment - net of accumulated depreciation of $4,882 and $4,015 at January 2, 2021 and December 28, 2019, respectively $ 5,991 $ 5,918 Liabilities Current: Operating Current operating lease liabilities $ 64,851 $ 68,838 Finance Short-term and current portion of long-term debt $ 1,088 $ 1,011 Noncurrent: Operating Long-term operating lease liabilities $ 230,635 $ 288,689 Finance Long-term debt $ 569 $ 1,468 The following table discloses the weighted-average remaining lease term and weighted-average discount rate for the Company's leases: Lease Term and Discount Rate January 2, 2021 December 28, 2019 Weighted-average remaining lease term: Operating leases 5.9 years 6.1 years Finance leases 1.2 years 2.3 years Weighted-average discount rate: Operating leases 14.0 % 13.9 % Finance leases 1.2 % 1.2 % Future minimum lease payments by year as of January 2, 2021 were as follows (in thousands): Fiscal Year Operating Leases Finance Leases 2021 $ 101,507 $ 1,095 2022 85,753 569 2023 66,909 — 2024 46,656 — 2025 33,012 — Thereafter 122,318 — Total lease payments $ 456,155 $ 1,664 Less: Interest 160,669 6 Total lease obligations $ 295,486 $ 1,658 Future minimum lease payments by year as of December 28, 2019 were as follows (in thousands): Fiscal Year Operating Leases Finance Leases 2020 $ 116,778 $ 1,042 2021 94,795 978 2022 81,536 488 2023 64,582 — 2024 45,846 — Thereafter 153,255 — Total lease payments $ 556,792 $ 2,508 Less: Interest 199,265 30 Finance lease obligations $ 357,527 $ 2,478 Supplemental cash flow information related to leases was as follows (in thousands): Fiscal Year 2020 Fiscal Year 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 131,499 $ 116,846 Operating cash flows from finance leases 33 38 Financing cash flows from finance leases 1,051 945 Leased assets obtained in exchange for new finance lease liabilities 49 83 Leased assets obtained in exchange for new operating lease liabilities 26,474 41,510 As of January 2, 2021, the Company did not have any material operating or finance leases that have been signed but not commenced. |
Leases | Leases The Company's leases consist primarily of retail space, offices, warehouses, distribution centers, equipment and vehicles. The Company determines if an agreement contains a lease at inception based on the Company's right to the economic benefits of the leased assets and its right to direct the use of the leased asset. Right-of-use ("ROU") assets represent the Company's right to use an underlying asset, and ROU liabilities represent the Company's obligation to make lease payments arising from the lease. ROU assets and liabilities are recognized at the lease commencement date based on the present value of the lease payments over the lease term. As the Company's leases do not provide an implicit rate, the Company uses its estimated collateralized incremental borrowing rate, which is based on the yield curve for the respective lease terms and adjusted for each lease country to determine the present value of the lease payments. Some leases include one or more options to renew at the Company's discretion, with renewal terms that can extend the lease from one to ten additional years. The renewal options are not included in the measurement of ROU assets and ROU liabilities unless the Company is reasonably certain to exercise the optional renewal periods. Short-term leases are leases having a term of twelve months or less at inception. The Company does not record a related lease asset or liability for short-term leases. The Company has certain leases containing lease and non-lease components which are accounted for as a single lease component. The Company has certain lease agreements where lease payments are based on a percentage of retail sales over contractual levels and others include rental payments adjusted periodically for inflation. The variable portion of these lease payments is not included in the Company's lease liabilities. The Company's lease agreements do not contain any significant restrictions or covenants other than those that are customary in such arrangements. As a result of the COVID-19 pandemic, the Company received lease concessions from landlords in the form of rent deferrals and rent forgiveness. The Company chose the policy election provided by the FASB in April 2020 to record rent concessions as if no modifications to leases contracts were made, and thus no changes to the ROU assets and ROU liabilities were recorded for these concessions. This guidance is only applicable to COVID-19 related lease concessions that do not result in a substantial increase in the rights of the lessor or the obligations of the lessee. As of January 2, 2021, the Company had outstanding deferred rent payments of $5.2 million, and the Company received rent forgiveness of $9.7 million for fiscal year 2020. The components of lease expense were as follows (in thousands): Lease Cost Consolidated Fiscal Year 2020 Fiscal Year 2019 Operating lease cost (1) SG&A $ 106,004 $ 117,932 Finance lease cost: Amortization of ROU assets SG&A $ 506 $ 475 Interest on lease liabilities Interest expense $ 33 $ 38 Short-term lease cost SG&A $ 610 $ 1,302 Variable lease cost SG&A $ 22,048 $ 36,476 _______________________________________________ (1) Includes sublease income, which was immaterial. The following table discloses supplemental balance sheet information for the Company’s leases (in thousands): Leases Consolidated Balance Sheets Location January 2, 2021 December 28, 2019 Assets Operating Operating lease right-of-use assets $ 226,815 $ 288,166 Finance Property, plant and equipment - net of accumulated depreciation of $4,882 and $4,015 at January 2, 2021 and December 28, 2019, respectively $ 5,991 $ 5,918 Liabilities Current: Operating Current operating lease liabilities $ 64,851 $ 68,838 Finance Short-term and current portion of long-term debt $ 1,088 $ 1,011 Noncurrent: Operating Long-term operating lease liabilities $ 230,635 $ 288,689 Finance Long-term debt $ 569 $ 1,468 The following table discloses the weighted-average remaining lease term and weighted-average discount rate for the Company's leases: Lease Term and Discount Rate January 2, 2021 December 28, 2019 Weighted-average remaining lease term: Operating leases 5.9 years 6.1 years Finance leases 1.2 years 2.3 years Weighted-average discount rate: Operating leases 14.0 % 13.9 % Finance leases 1.2 % 1.2 % Future minimum lease payments by year as of January 2, 2021 were as follows (in thousands): Fiscal Year Operating Leases Finance Leases 2021 $ 101,507 $ 1,095 2022 85,753 569 2023 66,909 — 2024 46,656 — 2025 33,012 — Thereafter 122,318 — Total lease payments $ 456,155 $ 1,664 Less: Interest 160,669 6 Total lease obligations $ 295,486 $ 1,658 Future minimum lease payments by year as of December 28, 2019 were as follows (in thousands): Fiscal Year Operating Leases Finance Leases 2020 $ 116,778 $ 1,042 2021 94,795 978 2022 81,536 488 2023 64,582 — 2024 45,846 — Thereafter 153,255 — Total lease payments $ 556,792 $ 2,508 Less: Interest 199,265 30 Finance lease obligations $ 357,527 $ 2,478 Supplemental cash flow information related to leases was as follows (in thousands): Fiscal Year 2020 Fiscal Year 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 131,499 $ 116,846 Operating cash flows from finance leases 33 38 Financing cash flows from finance leases 1,051 945 Leased assets obtained in exchange for new finance lease liabilities 49 83 Leased assets obtained in exchange for new operating lease liabilities 26,474 41,510 As of January 2, 2021, the Company did not have any material operating or finance leases that have been signed but not commenced. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Jan. 02, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies License Agreements. The Company has various license agreements to market watches and jewelry bearing certain trademarks or incorporating certain technology owned by third parties. In accordance with these agreements, the Company incurred royalty expense of approximately $137.2 million, $161.8 million and $173.0 million in fiscal years 2020, 2019 and 2018, respectively. These amounts are included in the Company's cost of sales or, if advertising-related, in SG&A. These license agreements have expiration dates between years 2021 and 2028 and require the Company to pay royalties ranging from 7% to 15% of defined net sales. The Company has future minimum royalty commitments through fiscal year 2028 under these license agreements as follows by fiscal year (in thousands): Fiscal Year Minimum Royalty 2021 $ 112,639 2022 20,304 2023 20,880 2024 19,035 2025 17,040 Thereafter 7,710 Total $ 197,608 These minimum royalty commitments do not include amounts owed under these license agreements for obligations of the Company to pay the licensors a percentage of net sales of these licensed products. Purchase Obligations. As of January 2, 2021, the Company had purchase obligations totaling $363.1 million that consisted primarily of open non-cancelable purchase orders. Asset Retirement Obligations. ASC 410, Asset Retirement and Environmental Obligations requires (i) that the fair value of a liability for an asset retirement obligation be recognized in the period in which it is incurred if a reasonable estimate of fair value can be made and (ii) that the associated asset retirement costs be capitalized as part of the carrying amount of the long-lived asset. The Company's asset retirement obligations relate to costs associated with the retirement of leasehold improvements under office leases and retail store leases within the Americas, Europe and Asia segments. The following table summarizes the changes in the Company's asset retirement obligations (in thousands): Fiscal Year 2020 2019 Beginning asset retirement obligation $ 12,093 $ 11,862 Additions and changes in estimate 1,542 563 Liabilities settled during the period (933) (681) Accretion expense 325 366 Currency translation 818 (17) Ending asset retirement obligations $ 13,845 $ 12,093 Litigation. The Company is occasionally subject to litigation or other legal proceedings in the normal course of its business. The Company does not believe that the outcome of any currently pending legal matters, individually or collectively, will have a material effect on the business or financial condition of the Company. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Jan. 02, 2021 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | Stockholders' Equity Common and Preferred Stock. The Company has 100,000,000 shares of common stock, par value $0.01 per share, authorized, with 51,474,034 and 50,516,477 shares issued and outstanding at fiscal year-end 2020 and 2019, respectively. The Company has 1,000,000 shares of preferred stock, par value $0.01 per share, authorized, with none issued or outstanding at fiscal year-end 2020 and 2019. Rights, preferences and other terms of preferred stock will be determined by the Board of Directors at the time of issuance. Common Stock Repurchase Programs. Purchases of the Company's common stock have been made from time to time pursuant to its repurchase programs, subject to market conditions and at prevailing market prices, through the open market. Repurchased shares of common stock are recorded at cost and become authorized but unissued shares which may be issued in the future for general corporate or other purposes. In the event the repurchased shares are canceled, the Company accounts for retirements by allocating the repurchase price to common stock, additional paid‑in capital and retained earnings. The repurchase price allocation is based upon the equity contribution associated with historical issuances. The repurchase programs have been conducted pursuant to Rule 10b‑18 of the Securities Exchange Act of 1934. During the period from December 2012 to the end of fiscal year 2020, the Company repurchased approximately $1.2 billion of its common stock, representing approximately 11.8 million shares. At January 2, 2021 and December 28, 2019, all treasury stock had been effectively retired. As of January 2, 2021, the Company had $30.0 million of repurchase authorizations remaining under its repurchase plan. |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Jan. 02, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Employee Benefit Plans | Employee Benefit Plans Deferred Compensation and Savings Plans. The Company has a defined contribution savings plan (the "401(k) Plan") for substantially all U.S.-based full-time employees of the Company, which includes a Roth 401(k) option. The Company's common stock is one of several investment alternatives available under the 401(k) Plan. The Company has a discretionary match for the 401(k) Plan. In order to mitigate the financial impact of COVID-19, the Company suspended 401(k) matching for the majority of fiscal year 2020. Matching contributions made by the Company to the 401(k) Plan totaled approximately $1.0 million, $3.2 million and $2.8 million for fiscal years 2020, 2019 and 2018, respectively. The Company also has the right to make additional matching contributions not to exceed 15% of employee compensation. The Company did not make any additional matching contributions during fiscal years 2020, 2019 and 2018. Under the Fossil Group, Inc. and Affiliates Deferred Compensation Plan (the "Deferred Plan") eligible participants may elect to defer up to 50% of their salary or up to 100% of any bonuses paid pursuant to the terms and conditions of the Deferred Plan. In addition, the Company may make employer contributions to participants under the Deferred Plan from time to time. The Company made no contributions to the Deferred Plan during fiscal years 2020, 2019 and 2018. In prior periods, the Company made payments pursuant to the Deferred Plan into a Rabbi Trust. The funds held in the Rabbi Trust are directed to certain investments available through life insurance products. The Company had assets of $6.3 million and $5.2 million related to the Company's invested balances recorded in intangible and other assets—net and liabilities of $4.4 million and $4.6 million related to the participants' invested balances recorded in accrued expenses—other, each on the Company's consolidated balance sheets at the end of fiscal years 2020 and 2019, respectively. Stock-Based Compensation Plans. The Company’s grants under its current stock-based compensation plans generally include: (i) stock options, restricted stock units, and performance restricted stock units for its international employees, (ii) restricted stock units for its nonemployee directors, and (iii) stock appreciation rights, performance stock appreciation rights, restricted stock, restricted stock units, and performance restricted stock units for its U.S.-based employees. As of January 2, 2021, the Company had approximately $7.3 million of total unrecognized compensation cost related to non-vested share-based compensation arrangements granted under the Company's stock-based compensation plans. This cost is expected to be recognized over a weighted-average period of 1.4 years. All time-based or performance-based stock appreciation rights and restricted stock units are settled in shares of the Company's common stock. Long-Term Incentive Plans. An aggregate of 3,000,000 shares of the Company's common stock were reserved for issuance pursuant to the Company's 2016 Long-Term Incentive Plan ("2016 LTIP"), adopted in March 2016. Pursuant to the First Amendment to the Company’s 2016 Long-Term Incentive Plan, which was approved by our stockholders on May 23, 2018, the number of shares of the Company’s common stock authorized for issuance under the Company’s 2016 Long-Term Incentive Plan, as amended (the “2016 Plan”), was increased from 3,000,000 to 10,288,468, such additional shares consisting of (i) 5,000,000 additional shares of common stock and (ii) up to 2,288,468 shares of common stock subject to awards under the Company’s 2008 Long-Term Incentive Plan (the “2008 Plan”) that were outstanding on March 31, 2018 and, on or after March 31, 2018, are forfeited, expire or are canceled. Under the 2016 Plan, designated employees of the Company, including officers, certain contractors, and outside directors of the Company, are eligible to receive (i) stock options, (ii) stock appreciation rights, (iii) restricted or non-restricted stock awards, (iv) restricted stock units, (v) performance awards, (vi) cash awards, or (vii) any combination of the foregoing. The 2016 Plan is administered by the Compensation Committee of the Company's Board of Directors (the "Compensation Committee"). Each award issued under the 2016 Plan terminates at the time designated by the Compensation Committee, not to exceed ten years. The current outstanding stock options, stock appreciation rights, performance stock appreciation rights, restricted stock, restricted stock units and performance restricted stock units issued under the 2016 Plan predominantly have original vesting periods of three years. Time-based or performance-based stock appreciation rights and restricted stock units are predominately settled in shares of the Company's common stock. On the date of the Company’s annual stockholders meeting, each nonemployee director automatically receives restricted stock units with a fair market value of approximately $130,000, which vest 100% on the earlier of one year from the date of grant or the date of the Company's next annual stockholders meeting, provided such director is providing services to the Company or a subsidiary of the Company on that date. Notwithstanding the foregoing, the Company’s Board of Directors elected to take a 25% reduction of such annual grant in 2020, 2019 and 2018. In addition, for the 2020 annual grant, the Company's common stock price used to calculate the value of the annual grant was $15.00 (on May 20, 2020, the date of the annual grant, the midpoint of the high and low sales prices of the Company's common stock was $2.86 per share). Therefore, each nonemployee director received a grant on May 20, 2020 of restricted stock units with a fair market value of approximately $18,600. Stock Options, Stock Appreciation Rights and Performance Stock Appreciation Rights. The fair value of stock options, stock appreciation rights and performance stock appreciation rights granted under the Company's stock-based compensation plans were estimated on the date of grant using the Black-Scholes option pricing model. The expected term of the stock options represents the estimated period of time until exercise and is based on historical experience of similar awards. Expected stock price volatility is based on the historical volatility of the Company’s common stock. The risk‑free interest rate is based on the implied yield available on U.S. Treasury securities with an equivalent remaining term. The Company did not issue stock options, stock appreciation rights and performance stock appreciation rights in fiscal years 2020, 2019 and 2018. The following table summarizes stock option, stock appreciation rights and performance stock appreciation rights activity: Stock Options and Stock Appreciation Rights Shares Weighted-Average Weighted-Average Aggregate in thousands in thousands Outstanding at December 30, 2017 2,177 $ 50.01 5.3 $ — Granted — — Exercised (21) 14.46 37 Forfeited or expired (226) 59.58 Outstanding at December 29, 2018 1,930 49.25 1.3 37 Granted — — Exercised (13) 13.65 18 Forfeited or expired (1,408) 39.84 Outstanding at December 28, 2019 509 76.13 2.5 — Granted — — Exercised — — — Forfeited or expired (126) 79.44 Outstanding at January 2, 2021 383 75.05 1.9 — Exercisable at January 2, 2021 383 $ 75.05 1.9 $ — The aggregate intrinsic value in the table above is before income taxes and is based on the exercise price for outstanding and exercisable options/rights at January 2, 2021 and based on the fair market value of the Company's common stock on the exercise date for options/rights that were exercised during the fiscal year. Stock Options, Stock Appreciation Rights and Performance Stock Appreciation Rights Outstanding and Exercisable. The following tables summarize information with respect to stock options, stock appreciation rights and performance stock appreciation rights outstanding and exercisable at January 2, 2021: Stock Options Outstanding Stock Options Range of Exercise Prices Number of Weighted-Average Weighted-Average Number of Weighted- in thousands in thousands $55.04 - $82.55 44 81.23 0.2 44 81.23 $95.91 - $131.46 62 128.11 1.1 62 128.11 Total 106 $ 108.76 0.8 106 $ 108.76 Stock Appreciation Rights Outstanding Stock Appreciation Range of Exercise Prices Number of Weighted-Average Weighted-Average Number of Weighted- in thousands in thousands $29.49 - $47.99 166 41.77 2.9 166 41.77 $55.04 - $82.55 59 77.98 1.9 59 77.98 $95.91 - $113.04 52 109.71 0.8 52 109.71 Total 277 $ 62.17 2.3 277 $ 62.17 Restricted Stock, Restricted Stock Units and Performance Restricted Stock Units. The following table summarizes restricted stock, restricted stock unit and performance restricted stock unit activity: Restricted Stock, Restricted Stock Units and Performance Restricted Stock Units Number of Weighted-Average in thousands Nonvested at December 30, 2017 2,981 $ 20.84 Granted 1,456 14.35 Vested (1,040) 25.21 Forfeited (386) 19.87 Nonvested at December 29, 2018 3,011 $ 17.86 Granted 1,008 13.01 Vested (1,293) 17.92 Forfeited (397) 21.49 Nonvested at December 28, 2019 2,329 $ 15.16 Granted 1,124 3.76 Vested (1,127) 16.42 Forfeited (590) 12.42 Nonvested at January 2, 2021 1,736 $ 7.90 The total fair value of shares/units vested during fiscal years 2020, 2019 and 2018 was $4.8 million, $17.6 million and $16.6 million, respectively. Other Retirement Plans. The Company maintains a defined benefit plan for its employees located in Switzerland. The plan is funded through payments to an insurance company. The payments are determined by periodic actuarial calculations. During fiscal years 2020, 2019 and 2018, the Company recorded pension gains (expenses) of ($1.3) million, $0.7 million and $(0.6) million, respectively, related to this plan. The liability for the Company's defined benefit plan was $14.5 million and $17.0 million at the end of fiscal years 2020 and 2019, respectively. This liability is recorded in other long-term liabilities on the Company's consolidated balance sheets. Under French law, the Company is required to maintain a defined benefit plan for its employees located in France, which is referred to as a "retirement indemnity." The amount of the retirement indemnity is based on the employee's last salary and duration of employment with the Company. The employee's right to receive the retirement indemnity is subject to the employee remaining with the Company until retirement. During fiscal years 2020, 2019 and 2018, the Company recorded pension gains (expenses) of $0.2 million, $(0.4) million and $0.4 million, respectively, for its retirement indemnity obligations. The liability for the Company's retirement indemnity was $1.2 million at the end of both fiscal years 2020 and 2019. This liability is recorded in other long-term liabilities on the Company's consolidated balance sheets. |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 12 Months Ended |
Jan. 02, 2021 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Cash Flow Information | Supplemental Cash Flow Information The following table summarizes supplemental cash flow information (in thousands): Fiscal Year 2020 2019 2018 Cash paid during the year for: Interest $ 21,194 $ 25,310 $ 38,855 Income taxes, net of refunds $ 10,027 $ 18,025 $ 28,460 Supplemental disclosures of non-cash investing and financing activities: Additions to property, plant and equipment included in accounts payable $ 1,034 $ 2,060 $ 3,868 Additions to property, plant and equipment acquired under finance leases $ 49 $ 83 $ — |
Supplemental Disclosure for Acc
Supplemental Disclosure for Accumulated Other Comprehensive Income (Loss) | 12 Months Ended |
Jan. 02, 2021 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Supplemental Disclosure for Accumulated Other Comprehensive Income (Loss) | Supplemental Disclosure for Accumulated Other Comprehensive Income (Loss) The following table illustrates changes in the balances of each component of accumulated other comprehensive income (loss), net of taxes (in thousands): January 2, 2021 Cash Flow Hedges Currency Forward Pension Total Beginning balance $ (80,474) $ 2,983 $ (3,124) $ (80,615) Other comprehensive income (loss) before reclassifications 19,296 2,278 5,057 26,631 Tax (expense) benefit — (61) (505) (566) Amounts reclassed from accumulated other comprehensive income (loss) — 4,781 — 4,781 Tax (expense) benefit — (431) — (431) Total other comprehensive income (loss) 19,296 (2,133) 4,552 21,715 Ending balance $ (61,178) $ 850 $ 1,428 $ (58,900) December 28, 2019 Cash Flow Hedges Currency Forward Pension Total Beginning balance $ (74,868) $ 8,582 $ 1,595 $ (64,691) Other comprehensive income (loss) before reclassifications (5,606) 6,510 (5,165) (4,261) Tax (expense) benefit — (450) 446 (4) Amounts reclassed from accumulated other comprehensive income (loss) — 12,688 — 12,688 Tax (expense) benefit — (1,029) — (1,029) Total other comprehensive income (loss) (5,606) (5,599) (4,719) (15,924) Ending balance $ (80,474) $ 2,983 $ (3,124) $ (80,615) December 29, 2018 Cash Flow Hedges Currency Forward Pension Total Beginning balance $ (64,499) $ (10,098) $ (1,672) $ (76,269) Other comprehensive income (loss) before reclassifications (10,369) 18,044 3,757 11,432 Tax (expense) benefit — — (490) (490) Amounts reclassed from accumulated other comprehensive income (loss) — (4,283) — (4,283) Tax (expense) benefit — 1,654 — 1,654 Total other comprehensive income (loss) (10,369) 20,673 3,267 13,571 Adoption of ASU 2018-02 — (1,993) — (1,993) Ending balance $ (74,868) $ 8,582 $ 1,595 $ (64,691) |
Major Customer, Segment and Geo
Major Customer, Segment and Geographic Information | 12 Months Ended |
Jan. 02, 2021 | |
Segment Reporting [Abstract] | |
Major Customer, Segment and Geographic Information | Major Customer, Segment and Geographic Information Major Customer Wholesale customers of the Company consist principally of major department stores and specialty retail stores located throughout the world. No individual customer accounts for 10% or more of the Company's net sales. Segment Information The Company reports segment information based on the "management approach". The management approach designates the internal reporting used by management for making decisions and assessing performance as the source of the Company's reportable segments. The Company manages its business primarily on a geographic basis. The Company's reportable operating segments are comprised of (i) Americas, (ii) Europe and (iii) Asia. Each reportable operating segment includes sales to wholesale and distributor customers, and sales through Company-owned retail stores and e-commerce activities based on the location of the selling entity. The Americas segment primarily includes sales to customers based in Canada, Latin America and the United States. The Europe segment primarily includes sales to customers based in European countries, the Middle East and Africa. The Asia segment primarily includes sales to customers based in Australia, China (including Hong Kong, Macau and Taiwan), India, Indonesia, Japan, Malaysia, New Zealand, Singapore, South Korea and Thailand. Each reportable operating segment provides similar products and services. The Company evaluates the performance of its reportable segments based on net sales and operating income (loss). Net sales for geographic segments are based on the location of the selling entity. Operating income (loss) for each segment includes net sales to third parties, related cost of sales and operating expenses directly attributable to the segment. Corporate includes peripheral revenue generating activities from factories and intellectual property and general corporate expenses, including certain administrative, legal, accounting, technology support costs, equity compensation costs, payroll costs attributable to executive management, brand management, product development, art, creative/product design, marketing, strategy, compliance and back office supply chain expenses that are not allocated to the various segments because they are managed at the corporate level internally. The Company does not include intercompany transfers between segments for management reporting purposes. Summary information by operating segment was as follows (in thousands): Fiscal Year 2020 Net Sales Operating Depreciation Long-term Total Assets Americas $ 642,213 $ 32,998 $ 10,692 $ 112,934 $ 319,586 Europe 522,364 19,482 12,222 135,190 328,246 Asia 434,351 62,589 6,174 82,122 234,770 Corporate 14,415 (250,388) 13,162 157,784 595,903 Consolidated $ 1,613,343 $ (135,319) $ 42,250 $ 488,030 $ 1,478,505 Fiscal Year 2019 Net Sales Operating Depreciation Long-term Total Assets Americas $ 949,965 $ 66,703 $ 15,104 $ 164,097 $ 474,428 Europe 715,494 88,323 15,099 171,952 406,603 Asia 535,156 101,209 6,724 89,434 298,034 Corporate 17,097 (284,618) 16,515 119,791 425,667 Consolidated $ 2,217,712 $ (28,383) $ 53,442 $ 545,274 $ 1,604,732 Fiscal Year 2018 Net Sales Operating Depreciation Long-term Total Assets Americas $ 1,174,507 $ 185,094 $ 16,542 $ 61,914 $ 393,273 Europe 856,291 129,610 18,933 99,253 353,797 Asia 505,473 87,515 8,016 29,990 173,666 Corporate 5,217 (339,508) 23,588 125,472 654,462 Consolidated $ 2,541,488 $ 62,711 $ 67,079 $ 316,629 $ 1,575,198 The following table shows revenue for each class of similar products for fiscal years 2020, 2019 and 2018 (in thousands): Fiscal Year 2020 Fiscal Year 2019 Fiscal Year 2018 Net Sales Percentage Net Sales Percentage Net Sales Percentage Watches $ 1,299,846 80.6 % $ 1,802,481 81.3 % $ 2,033,021 80.0 % Leathers 173,621 10.7 238,619 10.8 289,385 11.4 Jewelry 102,917 6.4 123,177 5.6 167,775 6.6 Other 36,959 2.3 53,435 2.3 51,307 2.0 Total $ 1,613,343 100.0 % $ 2,217,712 100.0 % $ 2,541,488 100.0 % Geographic Information Net sales and long-lived assets related to the Company's operations in the U.S., Europe, Asia and all other international markets were as follows (in thousands): Fiscal Year 2020 Net Sales (1) Long-term United States $ 546,753 $ 234,325 Europe 525,333 (2) 147,208 Asia 436,570 (3) 89,144 All other international 104,687 17,353 Consolidated $ 1,613,343 $ 488,030 Fiscal Year 2019 Net Sales (1) Long-term United States $ 819,825 $ 239,032 Europe 718,216 (2) 184,507 Asia 537,503 (3) 99,565 All other international 142,168 22,170 Consolidated $ 2,217,712 $ 545,274 Fiscal Year 2018 Net Sales (1) Long-term United States $ 1,017,919 $ 159,062 Europe 857,972 (2) 111,964 Asia 507,523 (3) 36,945 All other international 158,074 8,658 Consolidated $ 2,541,488 $ 316,629 _______________________________________________________________________________ (1) Net sales are based on the location of the selling entity (including exports). (2) Net sales from Germany (including exports) accounted for more than 10% of the Company's consolidated net sales and were approximately $225.5 million, $310.1 million and $359.9 million in fiscal years 2020, 2019 and 2018, respectively. (3) Net sales from China (including Hong Kong, Macau and Taiwan and exports) accounted for more than 10% of the Company's consolidated net sales in fiscal year 2020 and were approximately $228.4 million, $218.1 million and $190.0 million in fiscal years 2020, 2019 and 2018, respectively. |
Restructuring
Restructuring | 12 Months Ended |
Jan. 02, 2021 | |
Restructuring and Related Activities [Abstract] | |
Restructuring | Restructuring In fiscal year 2019, the Company launched New World Fossil 2.0 - Transform to Grow Program (“NWF 2.0”), which is focused on optimizing the Company’s operating structure to be more efficient, with faster decision-making and a more consumer-centric focus. In addition to optimizing the way the Company goes to market, the Company is also pursuing additional gross margin expansion opportunities. The Company is taking a zero-based budgeting approach to adjust its business model to enable more investment in digital capabilities and marketing, move closer to the consumer and react more quickly to the ever-evolving consumer shopping patterns. The Company also plans to change overall business processes and resources, creating a more centrally directed operating model, reducing complexity and redundancy, and operating at a lower cost base. The NWF 2.0 restructuring program was expanded to address additional challenges posed by COVID-19, including a number of cost saving measures such as store closures. The Company estimates total NWF 2.0 charges of $75 million to $85 million. The following tables show a rollforward of the accrued liability related to the Company’s NWF 2.0 restructuring plan (in thousands): Fiscal Year 2020 Liabilities Cash Payments Non-cash Items Liabilities December 28, 2019 Charges January 2, 2021 Store closures $ 22 $ 4,347 $ 1,597 $ 2,532 $ 240 Professional services 2,824 7,503 8,047 — 2,280 Severance and employee-related benefits 4,238 24,658 21,155 — 7,741 Total $ 7,084 $ 36,508 $ 30,799 $ 2,532 $ 10,261 Fiscal Year 2019 Liabilities Cash Payments Non-cash Items Liabilities December 29, 2018 Charges December 28, 2019 Store closures $ — $ 597 $ — $ 575 $ 22 Professional services — 8,039 5,215 — 2,824 Severance and employee-related benefits — 10,195 5,957 — 4,238 Total $ — $ 18,831 $ 11,172 $ 575 $ 7,084 NWF 2.0 restructuring charges by operating segment were as follows (in thousands): 2020 2019 Americas $ 4,969 $ 2,048 Europe 12,630 9,333 Asia 8,823 773 Corporate 10,086 6,677 Consolidated $ 36,508 $ 18,831 The Company implemented a multi-year restructuring program that began in fiscal year 2016 called New World Fossil ("NWF 1.0") and concluded in fiscal 2019. The remaining liability under NWF 1.0 is no longer material as of January 2, 2021, therefore the rollforward of the liability is not presented below. The following table shows a rollforward of the accrued liability related to the Company’s NWF 1.0 restructuring plan (in thousands): Fiscal Year 2019 Liabilities Cash Payments Non-cash Items Liabilities December 29, 2018 Charges December 28, 2019 Store closures $ 2,818 $ 2,971 $ 1,673 $ 2,253 $ 1,863 Professional services 2,198 485 1,368 — 1,315 Severance and employee-related benefits 3,011 7,349 7,460 2,368 532 Total $ 8,027 $ 10,805 $ 10,501 $ 4,621 $ 3,710 NWF 1.0 restructuring charges by operating segment were as follows (in thousands): 2019 2018 Americas $ 2,941 $ 17,197 Europe 1,272 10,116 Asia 793 2,946 Corporate 5,799 16,371 Consolidated $ 10,805 $ 46,630 |
SCHEDULE II VALUATIONS AND QUAL
SCHEDULE II VALUATIONS AND QUALIFYING ACCOUNTS | 12 Months Ended |
Jan. 02, 2021 | |
SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract] | |
SCHEDULE II VALUATIONS AND QUALIFYING ACCOUNTS | SCHEDULE II FOSSIL GROUP, INC. AND SUBSIDIARIES VALUATIONS AND QUALIFYING ACCOUNTS Fiscal Years 2018, 2019 and 2020 (in thousands) Additions Deductions Classification Balance at Charged Charged to Other Accounts Actual Balance at Fiscal Year 2018: Account receivable allowances: Bad debts $ 12,928 $ 8,921 $ — $ 7,848 $ 14,001 Markdowns $ — $ 37,904 $ 28,416 $ 47,301 $ 19,019 Sales returns $ 75,200 $ 108,485 $ — $ 116,553 $ 67,132 Deferred tax asset valuation allowance $ 78,314 $ 13,102 $ 4,402 $ — $ 95,818 Fiscal Year 2019: Account receivable allowances: Bad debts $ 14,001 $ 2,921 $ — $ 3,688 $ 13,234 Markdowns $ 19,019 $ 49,915 $ — $ 45,848 $ 23,086 Sales returns $ 67,132 $ 139,350 $ — $ 129,015 $ 77,467 Deferred tax asset valuation allowance $ 95,818 $ 15,672 $ 6,599 $ — $ 118,089 Fiscal Year 2020: Account receivable allowances: Bad debts $ 13,234 $ 9,535 $ — $ 1,995 $ 20,774 Markdowns $ 23,086 $ 39,931 $ — $ 47,404 $ 15,613 Sales returns $ 77,467 $ 76,698 $ — $ 104,339 $ 49,826 Deferred tax asset valuation allowance $ 118,089 $ 18,491 $ (4,216) $ 23,114 $ 109,250 |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 12 Months Ended |
Jan. 02, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Consolidated Financial Statements | Consolidated Financial Statements include the accounts of Fossil Group, Inc., a Delaware corporation, and its subsidiaries (the "Company"). The Company is a leader in the design, development, marketing and distribution of contemporary, high quality fashion accessories on a global basis. The Company's products are sold primarily through department stores, specialty retailers, Company-owned retail stores and commercial websites worldwide. The Company reports on a fiscal year reflecting the retail-based calendar (containing 4-4-5 week calendar quarters). References to fiscal years 2020, 2019 and 2018 are for the fiscal years ended January 2, 2021, December 28, 2019 and December 29, 2018, respectively. The Company's fiscal year periodically results in a 53-week year instead of a normal 52-week year. The fiscal year ended January 2, 2021 was a 53-week year, with the additional week included in the first quarter of the fiscal year. Accordingly, the information presented herein includes 53 weeks of operations for fiscal year 2020 as compared to 52 weeks in fiscal years 2019 and 2018. All intercompany balances and transactions are eliminated in consolidation. |
Use of Estimates | Use of Estimates is required in the preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America. Management makes estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, management evaluates its estimates and judgments, including those related to product returns, bad debt, inventories, long-lived asset impairment, impairment of trade names, income taxes, warranty costs and litigation liabilities. Management bases its estimates and judgments on the information available at the time and various other assumptions believed to be reasonable under the circumstances, including estimates of the impact of the coronavirus (“COVID-19”) pandemic. Management estimates form the basis for making judgments about the carrying value of the assets and liabilities that are not readily apparent from other sources. Actual results could differ from those estimates, including the impact of the COVID-19 pandemic. |
Concentration of Risk | Concentration of Risk involves financial instruments that potentially expose the Company to concentration of credit risk and consist primarily of cash investments and accounts receivable. The Company places its cash investments with high-credit quality financial institutions and currently invests primarily in corporate debt securities and money market funds with major banks and financial institutions. Accounts receivable are generally diversified due to the number of entities comprising the Company's customer base and their dispersion across many geographic regions. The Company believes no significant concentration of credit risk exists with respect to these cash investments and accounts receivable. A significant portion of sales of the Company's products are supplied by manufacturers located outside of the U.S., primarily in Asia. While the Company is not dependent on any single manufacturer outside the U.S., the Company could be adversely affected by political, economic or other disruptions affecting the business or operations of third-party manufacturers located outside of the U.S. In fiscal year 2020, 43% of the Company's global watch production was assembled or procured through wholly or majority-owned factories. |
Cash Equivalents | Cash Equivalents are considered all highly liquid investments with original maturities of three months or less. |
Restricted Cash | Restricted Cash was comprised primarily of restricted cash balances for pledged collateral to secure bank guarantees for the purpose of obtaining retail space. |
Accounts Receivable | Accounts Receivable at the end of fiscal years 2020 and 2019 are stated net of doubtful accounts |
Inventories | Inventories are stated at the lower of cost and net realizable value, including any applicable duty and freight charges. Inventory held at consignment locations is included in the Company's finished goods inventory |
Investments | Investments in which the Company has significant influence over the investee are accounted for utilizing the equity method. If the Company does not have significant influence over the investee, the cost method is utilized. |
Lease | Lease assets represent the right to use an underlying asset for the lease term, and lease liabilities represent the obligation to make lease payments arising from the lease. These assets and liabilities are initially recognized based on the present value of lease payments over the lease term calculated using the Company's incremental borrowing rate, adjusted for the lease term and lease country, unless the implicit rate is readily determinable. Lease assets also include any upfront lease payments made and are reduced by lease incentives. Some lease terms include options to extend or terminate the lease and they are included in the measurement of the lease assets and lease liabilities if the Company is reasonably certain that those options will be exercised. Variable lease payments are expensed as incurred and include certain index-based changes in rent and certain non-lease components such as maintenance and other services provided by the lessor to the extent the charges are variable. The Company evaluates contractual arrangements at inception to determine if individual agreements are a lease or contain an identifiable lease component as defined by Accounting Standards Codification ("ASC") 842, Leases ("ASC 842"). When evaluating contracts to determine appropriate classification and recognition under ASC 842, significant judgment may be necessary to determine, among other criteria, if an embedded leasing arrangement exists, the length of the term, classification as either an operating or financing lease and whether renewal or termination options are reasonably certain to be exercised. Leases with an initial term of 12 months or less are not recorded on the balance sheet. Lease agreements with lease and non-lease components are combined as a single lease component for all classes of underlying assets. The depreciable life of lease assets and leasehold improvements is limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise. |
Property, Plant and Equipment | Property, Plant and Equipment is stated at cost less accumulated depreciation and amortization. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets of 30 years for buildings, generally five years for machinery and equipment and furniture and fixtures and two to seven years for computer equipment and software. Leasehold improvements are amortized over the shorter of the lease term or the asset's estimated useful life. |
Other Intangible Assets | Other Intangible Assets include trademarks, trade names, developed technology, customer lists and patents. Trademarks, trade names with finite lives, developed technology, customer lists and patents are amortized using the straight-line method over their estimated useful lives, which are generally three to 20 years. Indefinite-lived trade names are evaluated for impairment annually as of the end of the fiscal year. Additionally, if events or conditions were to indicate an indefinite-lived trade name may not be recoverable, the Company would evaluate the asset for impairment at that time. Impairment testing compares the carrying amount of an intangible asset with its fair value. When the carrying amount of an intangible asset exceeds its fair value, an impairment charge is recorded. The fair value of the Company's MICHELE ® trade name was estimated using the relief from royalty method. During fiscal year 2020, the MICHELE trade name with a carrying amount of $10.9 million was written down to its implied fair value of $8.4 million, resulting in a pre-tax impairment charge of $2.5 million. No impairment charges were recorded to the MICHELE trade name during fiscal years 2019 or 2018. The SKAGEN ® |
Accrued Expenses | Accrued Expenses includes liabilities relating to warranties, duty, deferred compensation, gift cards, foreign exchange forward contracts ("forward contracts") and other accrued liabilities which are current in nature. |
Other Long-Term Liabilities | Other Long-Term Liabilities includes obligations relating to asset retirements, forward contracts and defined benefits relating to certain international employees that are not current in nature. |
Cumulative Translation Adjustment and Foreign Transaction Gains and Losses | Cumulative Translation Adjustment is included as a component of accumulated other comprehensive income (loss) and reflects the adjustments resulting from translating the financial statements of foreign subsidiaries into U.S. dollars. The functional currency of the Company's foreign subsidiaries is the currency of the primary economic environment in which the entity operates, which is generally the local currency of the country. Accordingly, assets and liabilities of the foreign subsidiaries are translated to U.S. dollars at fiscal year-end exchange rates. Income and expense items are translated at average monthly exchange rates. Cumulative translation adjustments remain in accumulated other comprehensive income (loss) and are reclassified into earnings in the event the related foreign subsidiary is sold or liquidated. Foreign Transaction Gains and Losses are those changes in exchange rates of currencies not considered the functional currency that affects cash flows and the related receivables or payables. The Company incurred net foreign currency transaction gains (losses) of approximately $(6.5) million, $3.9 million and $(5.8) million for fiscal years 2020, 2019 and 2018, respectively. These net gains (losses) have been included in other income (expense)—net in the Company's consolidated statements of income (loss) and comprehensive income (loss). |
Revenues | Revenues from sales of the Company's products, including those that are subject to inventory consignment agreements, are recognized when control of the product is transferred to the customer and in an amount that reflects the consideration the Company expects to be entitled in exchange for the product. The Company accepts limited returns from customers. The Company continually monitors returns and maintains a provision for estimated returns based upon historical experience and any specific issues identified. Product returns are accounted for as reductions to revenue and cost of sales and increases to customer liabilities and other current assets to the extent the returned product is resalable. The Company recorded an estimated returns provision of $49.8 million and $77.5 million in accrued expenses as of the end of fiscal years 2020 and 2019, respectively. Taxes imposed by governmental authorities on the Company's revenue-producing activities with customers, such as sales taxes and value added taxes, are excluded from net sales. |
Cost of Sales | Cost of Sales includes raw material costs, assembly labor, assembly overhead including depreciation expense, assembly warehousing costs and shipping and handling costs related to the movement of finished goods from assembly locations to sales distribution centers and from sales distribution centers to customer locations. Additionally, cost of sales includes customs duties, product packaging cost, royalty cost associated with sales of licensed products, the cost of molding and tooling and inventory shrinkage and damages. |
Operating Expenses | Operating Expenses include SG&A, trade name impairments and restructuring charges. SG&A expenses include selling and distribution expenses primarily consisting of sales and distribution labor costs, sales distribution center and warehouse facility costs, depreciation expense related to sales distribution and warehouse facilities, the four-wall operating costs of the |
Advertising Costs | Advertising Costs for in-store and media advertising as well as co-op advertising, catalog costs, product displays, show/exhibit costs, advertising royalties related to the sales of licensed brands, internet costs associated with affiliation fees, printing, sample costs and promotional allowances are expensed as incurred within SG&A. |
Warranty Costs | Warranty Costs are included in SG&A. The Company records an estimate for future warranty costs based on historical repair costs and adjusts the liability as required. Warranty costs have historically been within the Company's expectations and the provisions established. If such costs were to substantially exceed estimates, this could have an adverse effect on the Company's operating results. |
Research and Development Costs | Research and Development Costs are incurred primarily through the Company's in-house engineering team and also through some outside consulting and labor and consist primarily of personnel-related expenses, tooling and prototype materials and overhead costs. The Company’s research and development ("R&D") expenses are related to designing and developing new products and features and improving existing products. |
Noncontrolling Interest | Noncontrolling Interest is recognized as equity in the Company's consolidated balance sheets, is reflected in net income attributable to noncontrolling interest in the consolidated statements of income (loss) and comprehensive income (loss) and is captured within the summary of changes in equity attributable to controlling and noncontrolling interests. Noncontrolling interests represent ownership interests in the Company's subsidiaries held by third parties. |
Other Comprehensive Income (Loss) | Other Comprehensive Income (Loss) which is reported in the consolidated statements of income (loss) and comprehensive income (loss) and consolidated statements of stockholders' equity, consists of net income and other gains and losses affecting equity that are excluded from net income. The components of other comprehensive income (loss) primarily consist of foreign currency translation gains and losses and net realized and unrealized gains and losses on the following: (i) derivatives designated as cash flow hedges and (ii) the Company's defined benefit plans. |
Earnings (Loss) Per Share (EPS) | Earnings (Loss) Per Share ("EPS") is based on the weighted average number of common shares outstanding during each period. Diluted EPS adjusts basic EPS for the effects of dilutive common stock equivalents outstanding during each period using the treasury stock method. |
Income Taxes | Income Taxes are provided for under the asset and liability method for temporary differences in assets and liabilities recognized for income tax and financial reporting purposes. Deferred tax assets are periodically assessed for the likelihood of whether they are more likely than not to be realized. Tax benefits associated with uncertain tax positions are recognized in the period in which one of the following conditions is satisfied: (i) the more likely than not recognition threshold is satisfied; (ii) the position is ultimately settled through negotiation or litigation; or (iii) the statute of limitations for the taxing authority to examine and challenge the position has expired. Tax benefits associated with an uncertain tax position are derecognized in the period in which the more likely than not recognition threshold is no longer satisfied. The Global Intangible Low-Taxed Income (“GILTI”) provisions of the Tax Cuts and Jobs Act (the "Tax Act") requiring the inclusion of certain foreign earnings in U.S. taxable income first applied in fiscal year 2018. The GILTI tax was accounted for as incurred under the period cost method. The Company's valuation allowance analysis is affected by various aspects of the Tax Act, including the new limitation on the deductibility of interest expense and the impact of GILTI. Those adjustments may materially impact the provision for income taxes and the effective tax rate in the period in which the adjustments are made. |
Recently Issued Accounting Standards and Recently Adopted Accounting Standards | Recently Issued Accounting Standards In March 2020, the Financial Accounting Standards Board ("FASB") issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting ("ASU 2020-04") and subsequent guidance that clarified the scope and application of its original guidance. ASU 2020-04 provides optional expedients and exceptions to the current guidance on contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The amendments in this update apply only to contracts and hedging relationships that reference the London Interbank Offered Rate ("LIBOR") or another reference rate expected to be discontinued due to reference rate reform. The guidance was effective upon issuance and generally can be applied to applicable contract modifications through December 31, 2022. The Company will adopt these standards when LIBOR is discontinued and does not expect them to have a material impact on its consolidated financial statements or related disclosures. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes ("ASU 2019-12"). ASU 2019-12 simplifies the accounting for income taxes by removing certain exceptions to general principles in Income Taxes (Topic 740) . It also clarifies and amends existing guidance to improve consistent application. The guidance is effective for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years. The Company does not expect this standard to have a material impact on the Company's consolidated results of operations or financial position. Recently Adopted Accounting Standards In August 2018, the FASB issued ASU 2018-15, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40) ("ASU 2018-15"). ASU 2018-15 aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The Company adopted ASU 2018-15 at the beginning of the first quarter of fiscal year 2020, and it did not have a material effect on the Company's consolidated financial statements. In August 2018, the FASB issued ASU 2018-14, Compensation-Retirement Benefits-Defined Benefit Plans-General (Subtopic 715-20): Disclosure Framework-Changes to the Disclosure Requirements for Defined Benefit Plans ("ASU 2018-14"). ASU 2018-14 removes certain disclosures that are not considered cost beneficial, clarifies certain required disclosures and adds additional disclosures. The Company adopted ASU 2018-14 at the beginning of the first quarter of fiscal year 2020, and it did not have a material effect on the Company's consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement ("ASU 2018-13"). ASU 2018-13 (i) eliminates certain disclosure requirements related to the fair value hierarchy, (ii) adds new disclosure requirements related to the changes in unrealized gains and losses for recurring Level 3 fair value measurements and the range and weighted average of significant observable inputs used to develop Level 3 fair value measurements and (iii) modifies certain disclosure requirements related to measurement uncertainty for fair value measurements. The Company adopted ASU 2018-13 at the beginning of the first quarter of fiscal year 2020, and it did not have a material effect on the Company's consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments ("ASU 2016-13"). ASU 2016-13 modifies the measurement of expected credit losses of certain financial instruments, including trade receivables. The estimate of expected credit losses requires the consideration of historical information, current information and reasonable and supportable forecasts. The Company adopted ASU 2016-13 at the beginning of the first quarter of fiscal year 2020 on a prospective basis, and it did not have a material effect on the Company's consolidated financial statements. |
Fair Value Measurements | The Company defines fair value as the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. ASC 820, Fair Value Measurement and Disclosures ("ASC 820"), establishes a fair value hierarchy, which prioritizes the inputs used in measuring fair value into three broad levels as follows: • Level 1—Quoted prices in active markets for identical assets or liabilities. • Level 2—Inputs, other than quoted prices in active markets, that are observable either directly or indirectly. • Level 3—Unobservable inputs based on the Company's assumptions. ASC 820 requires the use of observable market data if such data is available without undue cost and effort. |
Significant Accounting Polici_3
Significant Accounting Policies (Tables) | 12 Months Ended |
Jan. 02, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of cash, cash equivalents, and restricted cash balances | The following table provides a reconciliation of the cash, cash equivalents, and restricted cash balances as of January 2, 2021, December 28, 2019 and December 29, 2018 that are presented in the consolidated statement of cash flows (in thousands): January 2, 2021 December 28, 2019 December 29, 2018 Cash and cash equivalents $ 315,965 $ 200,218 $ 403,373 Restricted cash included in prepaid expenses and other current assets 121 30 31 Restricted cash included in intangible and other assets-net 8,160 7,501 7,479 Cash, cash equivalents and restricted cash $ 324,246 $ 207,749 $ 410,883 |
Schedule of cash, cash equivalents, and restricted cash balances | The following table provides a reconciliation of the cash, cash equivalents, and restricted cash balances as of January 2, 2021, December 28, 2019 and December 29, 2018 that are presented in the consolidated statement of cash flows (in thousands): January 2, 2021 December 28, 2019 December 29, 2018 Cash and cash equivalents $ 315,965 $ 200,218 $ 403,373 Restricted cash included in prepaid expenses and other current assets 121 30 31 Restricted cash included in intangible and other assets-net 8,160 7,501 7,479 Cash, cash equivalents and restricted cash $ 324,246 $ 207,749 $ 410,883 |
Reconciliation of numerators and denominators used in the computations of both basic and diluted EPS | The following table reconciles the numerators and denominators used in the computations of both basic and diluted EPS (in thousands except per share data): Fiscal Year 2020 2019 2018 Numerator: Net income (loss) attributable to Fossil Group, Inc. $ (96,095) $ (52,365) $ (3,478) Denominator: Basic EPS computation: Basic weighted average common shares outstanding 51,116 50,230 49,196 Basic EPS $ (1.88) $ (1.04) $ (0.07) Diluted EPS computation: Basic weighted average common shares outstanding 51,116 50,230 49,196 Diluted weighted average common shares outstanding 51,116 50,230 49,196 Diluted EPS $ (1.88) $ (1.04) $ (0.07) |
Revenue (Tables)
Revenue (Tables) | 12 Months Ended |
Jan. 02, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The Company's revenue disaggregated by major product category and timing of revenue recognition was as follows (in thousands): Fiscal Year 2020 Americas Europe Asia Corporate Total Product Type Watches $ 507,278 $ 404,520 $ 388,004 $ 44 $ 1,299,846 Leathers 104,621 36,570 32,430 — 173,621 Jewelry 23,959 71,209 7,749 — 102,917 Other 6,355 10,065 6,168 14,371 36,959 Consolidated $ 642,213 $ 522,364 $ 434,351 $ 14,415 $ 1,613,343 Timing of Revenue Recognition Revenue recognized at a point in time $ 639,948 $ 520,878 $ 433,648 $ 5,451 $ 1,599,925 Revenue recognized over time 2,265 1,486 703 8,964 13,418 Consolidated $ 642,213 $ 522,364 $ 434,351 $ 14,415 $ 1,613,343 Fiscal Year 2019 Americas Europe Asia Corporate Total Product Type Watches $ 769,581 $ 557,460 $ 475,361 $ 79 $ 1,802,481 Leathers 145,632 47,308 45,679 — 238,619 Jewelry 24,826 92,935 5,416 — 123,177 Other 9,926 17,791 8,700 17,018 53,435 Consolidated $ 949,965 $ 715,494 $ 535,156 $ 17,097 $ 2,217,712 Timing of Revenue Recognition Revenue recognized at a point in time $ 947,353 $ 714,056 $ 534,403 $ 6,145 $ 2,201,957 Revenue recognized over time 2,612 1,438 753 10,952 15,755 Consolidated $ 949,965 $ 715,494 $ 535,156 $ 17,097 $ 2,217,712 Fiscal Year 2018 Americas Europe Asia Corporate Total Product Type Watches $ 936,875 $ 656,948 $ 439,029 $ 169 $ 2,033,021 Leathers 171,808 67,264 50,313 — 289,385 Jewelry 50,266 111,603 5,906 — 167,775 Other 15,558 20,476 10,225 5,048 51,307 Consolidated $ 1,174,507 $ 856,291 $ 505,473 $ 5,217 $ 2,541,488 Timing of Revenue Recognition Revenue recognized at a point in time $ 1,172,200 $ 855,219 $ 504,956 $ 4,477 $ 2,536,852 Revenue recognized over time 2,307 1,072 517 740 4,636 Consolidated $ 1,174,507 $ 856,291 $ 505,473 $ 5,217 $ 2,541,488 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Jan. 02, 2021 | |
Inventory Disclosure [Abstract] | |
Schedule of inventories | Inventories consisted of the following (in thousands): At Fiscal Year End 2020 2019 Components and parts $ 25,016 $ 35,626 Work-in-process 7,913 11,034 Finished goods 262,367 405,618 Inventories $ 295,296 $ 452,278 |
Warranty Liabilities (Tables)
Warranty Liabilities (Tables) | 12 Months Ended |
Jan. 02, 2021 | |
Product Warranties Disclosures [Abstract] | |
Schedule of warranty liability activity | Warranty liability activity consisted of the following (in thousands): Fiscal Year 2020 2019 2018 Beginning balance $ 23,095 $ 22,807 $ 19,405 Settlements in cash or kind (14,843) (18,073) (15,197) Warranties issued and adjustments to preexisting warranties (1) 13,664 18,361 18,599 Ending balance $ 21,916 $ 23,095 $ 22,807 ____________________________________________ (1) Changes in cost estimates related to preexisting warranties are aggregated with accruals for new standard warranties issued and foreign currency changes. |
Prepaid Expenses and Other Cu_2
Prepaid Expenses and Other Current Assets (Tables) | 12 Months Ended |
Jan. 02, 2021 | |
Prepaid Expense and Other Assets, Current [Abstract] | |
Schedule of prepaid expenses and other current assets | Prepaid expenses and other current assets consisted of the following (in thousands): At Fiscal Year End 2020 2019 Prepaid royalties $ 24,391 $ 22,258 Prepaid taxes 27,280 34,712 Current income tax receivable 37,674 — Other receivables 8,230 10,581 Forward contracts 345 3,327 Inventory returns 16,650 22,402 Property held for sale 10,359 — Short term deposits 1,238 1,530 Other 23,200 22,408 Prepaid expenses and other current assets $ 149,367 $ 117,218 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 12 Months Ended |
Jan. 02, 2021 | |
Property, Plant and Equipment [Abstract] | |
Schedule of the components of property, plant and equipment-net | Property, plant and equipment—net consisted of the following (in thousands): At Fiscal Year End 2020 2019 Land $ 5,833 $ 7,579 Buildings 31,474 37,012 Machinery and equipment 41,327 39,756 Furniture and fixtures 93,423 96,940 Computer equipment and software 225,352 235,757 Leasehold improvements 182,169 192,114 Construction in progress 1,623 7,255 581,201 616,413 Less accumulated depreciation and amortization 467,175 464,913 Property, plant and equipment-net $ 114,026 $ 151,500 |
Intangible and Other Assets (Ta
Intangible and Other Assets (Tables) | 12 Months Ended |
Jan. 02, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of intangible and other assets-net | Intangible and other assets-net consisted of the following (in thousands): 2020 2019 At Fiscal Year End Useful Gross Accumulated Gross Accumulated Intangibles-subject to amortization: Trademarks 10 yrs. $ 3,775 $ 3,198 $ 3,612 $ 2,993 Customer lists 5 - 10 yrs. 42,387 39,406 52,517 44,013 Patents 3 - 20 yrs. 2,371 1,973 2,308 1,937 Developed technology 7 yrs. 2,193 1,097 2,193 548 Trade name 6 yrs. 4,502 938 4,502 188 Other 7 - 20 yrs. 544 301 383 272 Total intangibles-subject to amortization 55,772 46,913 65,515 49,951 Intangibles-not subject to amortization: Trade names 8,895 11,315 Other assets: Other deposits 19,762 18,558 Deferred compensation plan assets 6,257 5,243 Deferred tax asset-net 33,893 38,275 Restricted cash 8,159 7,501 Tax receivable 58,734 6,507 Investments 327 500 Other 2,303 2,145 Total other assets 129,435 78,729 Total intangible and other assets $ 194,102 $ 46,913 $ 155,559 $ 49,951 Total intangible and other assets-net $ 147,189 $ 105,608 |
Schedule of estimated aggregate future amortization expense by fiscal year for intangible assets | Estimated aggregate future amortization expense by fiscal year for intangible assets is as follows (in thousands): Fiscal Year Amortization 2021 $ 3,384 2022 2,531 2023 909 2024 896 2025 1,139 |
Derivatives and Risk Manageme_2
Derivatives and Risk Management (Tables) | 12 Months Ended |
Jan. 02, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of outstanding forward contracts | As of January 2, 2021, the Company had the following outstanding forward contracts designated as cash flow hedges that were entered into to hedge the future payments of intercompany inventory transactions (in millions): Functional Currency Contract Currency Type Amount Type Amount Euro 81.3 U.S. dollar 98.2 Canadian dollar 22.0 U.S. dollar 17.1 British pound 8.8 U.S. dollar 11.8 Mexican peso 218.8 U.S. dollar 10.9 Japanese yen 985.6 U.S. dollar 9.5 Australian dollar 7.2 U.S. dollar 5.5 U.S. dollar 3.2 Japanese Yen 345.0 |
Schedule of derivatives instruments statements of financial performance and financial position, location | The effective portion of gains and losses on cash flow hedges that were recognized in other comprehensive income (loss), net of taxes during fiscal years 2020, 2019 and 2018 are set forth below (in thousands): Fiscal Year 2020 2019 2018 Cash flow hedges: Forward contracts $ 2,217 $ 6,060 $ 18,044 Total gain (loss) recognized in other comprehensive income (loss), net of taxes $ 2,217 $ 6,060 $ 18,044 |
Schedule of effective portion of gains and losses on derivative instruments designated and qualifying as cash flow hedges recorded in other comprehensive income (loss), net of taxes during the term of the hedging relationship and reclassified into earnings and gains and losses on derivatives not designated as hedging instruments recorded | The following table illustrates the effective portion of gains and losses on derivative instruments recorded in other comprehensive income (loss), net of taxes during the term of the hedging relationship and reclassified into earnings, and gains and losses on derivatives not designated as hedging instruments recorded directly to earnings during fiscal years 2020, 2019 and 2018 (in thousands): Derivative Instruments Consolidated Effect of Derivative Fiscal Year 2020 Fiscal Year 2019 Fiscal Year 2018 Forward contracts designated as cash flow hedging instruments Cost of sales Total gain (loss) reclassified from accumulated other comprehensive income (loss) $ 3,748 $ 9,939 $ — Forward contracts designated as cash flow hedging instruments Other income (expense)-net Total gain (loss) reclassified from accumulated other comprehensive income (loss) $ 602 $ 1,720 $ (2,629) Forward contracts not designated as hedging instruments Other income (expense)-net Total gain (loss) recognized in income $ (113) $ (88) $ 244 Interest rate swap not designated as a cash flow hedging instrument Other income (expense)-net Total gain (loss) recognized in income $ — $ — $ 67 |
Schedule of fair value amounts for derivative instruments as separate asset and liability values on a gross basis and their location on condensed consolidated balance sheets | The following table discloses the fair value amounts for the Company's derivative instruments as separate asset and liability values, presents the fair value of derivative instruments on a gross basis, and identifies the line items in the consolidated balance sheets in which the fair value amounts for these categories of derivative instruments are included (in thousands): Asset Derivatives Liability Derivatives January 2, 2021 December 28, 2019 January 2, 2021 December 28, 2019 Consolidated Fair Value Consolidated Fair Value Consolidated Fair Value Consolidated Fair Value Forward contracts designated as cash flow hedging instruments Prepaid expenses and other current assets $ 345 Prepaid expenses and other current assets $ 3,327 Accrued expenses-other $ 2,178 Accrued expenses-other $ 1,657 Forward contracts not designated as cash flow hedging instruments Prepaid expenses and other current assets — Prepaid expenses and other current assets — Accrued expenses-other 86 Accrued expenses-other 63 Forward contracts designated as cash flow hedging instruments Intangible and other assets-net 48 Intangible and other assets-net 21 Other long-term liabilities 35 Other long-term liabilities 104 Total $ 393 $ 3,348 $ 2,299 $ 1,824 The following table summarizes the effects of the Company's derivative instruments on earnings (in thousands): Effect of Derivative Instruments Fiscal Year 2020 Fiscal Year 2019 Cost of Sales Other Income (Expense)-net Cost of Sales Other Income (Expense)-net Total amounts of income and expense line items presented in the consolidated statements of income (loss) and comprehensive income (loss) in which the effects of cash flow hedges are recorded $ 842,987 $ (4,828) $ 1,118,274 $ 26,984 Gain (loss) on cash flow hedging relationships: Forward contracts designated as cash flow hedging instruments: Total gain (loss) reclassified from other comprehensive income (loss) 3,748 602 9,939 1,720 Forward contracts not designated as cash flow hedging instruments: Total gain (loss) recognized in income — (113) — (88) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Jan. 02, 2021 | |
Fair Value Disclosures [Abstract] | |
Schedule of the fair value hierarchy of assets and liabilities measured at fair value on a recurring basis | The following table presents the fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis as of January 2, 2021 (in thousands): Fair Value at January 2, 2021 Level 1 Level 2 Level 3 Total Assets: Forward contracts $ — $ 393 $ — $ 393 Deferred compensation plan assets: Investment in publicly traded mutual funds 6,257 — — 6,257 Total $ 6,257 $ 393 $ — $ 6,650 Liabilities: Contingent consideration $ — $ — $ 1,924 $ 1,924 Forward contracts — 2,299 — 2,299 Total $ — $ 2,299 $ 1,924 $ 4,223 The following table presents the fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis as of December 28, 2019 (in thousands): Fair Value at December 28, 2019 Level 1 Level 2 Level 3 Total Assets: Forward contracts $ — $ 3,348 $ — $ 3,348 Deferred compensation plan assets: Investment in publicly traded mutual funds 5,243 — — 5,243 Total $ 5,243 $ 3,348 $ — $ 8,591 Liabilities: Contingent consideration $ — $ — $ 1,141 $ 1,141 Forward contracts — 1,824 — 1,824 Total $ — $ 1,824 $ 1,141 $ 2,965 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Jan. 02, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of components of debt excluding finance lease obligations | The Company's debt consisted of the following, excluding finance lease obligations, (in millions): January 2, 2021 December 28, 2019 Revolving facility (1) $ 98.3 $ 28.0 U.S. term loan (2) 152.0 200.0 Other international 0.5 0.2 Total debt $ 250.8 $ 228.2 Less current portion 40.5 25.2 Long-term debt $ 210.3 $ 203.0 ___________________________________________ (1) Excludes debt issuance costs of $6.2 million and $7.9 million at January 2, 2021 and December 28, 2019, respectively. (2) Excludes debt issuance costs and original issue discount of $11.4 million and $7.4 million, respectively at January 2, 2021. Excludes debt issuance costs and original issue discount of $6.6 million and $11.2 million, respectively at December 28, 2019. |
Schedule of maturity of debt excluding finance lease obligations | The Company's debt as of January 2, 2021, excluding finance lease obligations, matures as follows (in millions): Less than 1 Year $ 40.5 Year 2 40.0 Year 3 30.0 Year 4 140.3 Principal amounts repayable 250.8 Debt issuance costs (17.6) Original issue discount (7.4) Total debt outstanding $ 225.8 |
Other Income (Expense)_Net (Tab
Other Income (Expense)—Net (Tables) | 12 Months Ended |
Jan. 02, 2021 | |
Other Income and Expenses [Abstract] | |
Schedule of other income (expense)—net | Other income (expense)—net consisted of the following (in thousands): Fiscal Year 2020 2019 2018 Interest income $ 573 $ 2,075 $ 2,605 Contingent consideration remeasurement (628) 601 3,381 Equity in losses of unconsolidated investment (345) (371) (558) Extinguishment of debt — (3,044) (718) Gain on asset divestitures — 23,134 — Net currency (losses) gains (6,481) 3,932 (5,820) Other net gains 2,053 657 1,072 Other income (expense) - net $ (4,828) $ 26,984 $ (38) |
Taxes (Tables)
Taxes (Tables) | 12 Months Ended |
Jan. 02, 2021 | |
Income Tax Disclosure [Abstract] | |
Schedule of significant components of the consolidated deferred tax assets and liabilities | Significant components of the consolidated deferred tax assets and liabilities were (in thousands): Fiscal Year 2020 2019 Deferred income tax assets: Inventory 4,095 6,856 Compensation 14,028 11,998 Property, plant and equipment — 220 Trade names and customer lists 5,163 4,345 Goodwill 13,189 14,947 Foreign accruals 12,582 10,446 Loss carryforwards 54,112 32,158 Tax credit carryforwards 2,771 4,281 Interest disallowance 9,604 16,683 Lease liabilities 54,857 82,511 Other 19,042 36,302 Deferred income tax assets total $ 189,443 $ 220,747 Deferred income tax liabilities: Property, plant and equipment (5,807) — Undistributed earnings of certain foreign subsidiaries (3,076) (329) Right-of-use assets (36,584) (65,070) Other (1,327) (1,081) Deferred income tax liabilities total $ (46,794) $ (66,480) Valuation allowance (109,250) (118,089) Net deferred income tax assets $ 33,399 $ 36,178 Net deferred income tax assets $ 33,894 $ 38,275 Net deferred income tax liabilities (495) (2,097) Net deferred income tax assets $ 33,399 $ 36,178 |
Schedule of the amounts and the fiscal year of expiration of loss carryforwards | The amounts and the fiscal year of expiration of the loss carryforwards are (in thousands): Expires 2021 through 2025 $ 29,990 Expires 2026 through 2030 58,328 Expires 2031 through 2035 — Expires 2036 through 2040 74,314 Indefinite 21,828 Total loss carryforwards $ 184,460 Expires 2021 through 2025 $ 2,567 Expires 2026 through 2030 13,677 Expires 2031 through 2035 16,545 Expires 2036 through 2040 80,377 Indefinite 49,292 Total loss carryforwards $ 162,458 |
Schedule of income before income taxes for the Company's U.S. and non-U.S. based operations | The following table identifies income (loss) before income taxes for the Company's U.S. and non-U.S. based operations for the fiscal years indicated (in thousands): Fiscal Year 2020 2019 2018 U.S $ (163,331) $ (142,141) $ (102,810) Non-U.S (8,652) 110,810 122,980 Total $ (171,983) $ (31,331) $ 20,170 |
Components of provision for income taxes | The Company's provision for income taxes consisted of the following for the fiscal years indicated (in thousands): Fiscal Year 2020 2019 2018 Current provision: U.S. federal $ (96,224) $ 2,338 $ (14,386) Non-U.S 16,522 28,109 35,854 State and local (681) (2,330) (2,056) Total current (80,383) 28,117 19,412 Deferred provision (benefit): U.S. federal — — — Non-U.S 4,340 (9,436) 1,696 State and local — — — Total deferred 4,340 (9,436) 1,696 Provision for income taxes $ (76,043) $ 18,681 $ 21,108 |
Reconciliation of the U.S. federal statutory income tax rate to the effective tax rate | A reconciliation of the U.S. federal statutory income tax rates to the Company's effective tax rate is as follows: Fiscal Year 2020 2019 2018 Tax at statutory rate 21.0 % 21.0 % 21.0 % Permanent differences (4.5) (2.0) (0.2) State, net of federal tax benefit (0.1) 17.6 (3.8) Foreign rate differential 1.2 12.8 (12.3) Withholding taxes (1.2) (11.1) 16.3 GILTI tax-net of foreign tax credits 2.1 (24.2) 11.8 U.S. tax on foreign income-net of foreign tax credits 3.9 0.3 6.4 Income tax contingencies 1.6 3.2 (5.0) Valuation allowances (0.4) (53.2) 65.0 Repatriation tax - net impact — — 5.9 Deficiencies on employee stock awards (1.4) (10.9) 10.1 Tax reform rate reduction impact on deferred tax assets — — (15.8) Foreign deferred tax rate change — (4.5) — Non deductible foreign equity awards (0.4) (3.2) 5.3 Non deductible officer compensation 0.7 (3.7) — Tax exempt foreign capital gain income — 6.3 — Deferred adjustment — (8.0) — CARES Act Rate Benefit 21.7 — — Provision for income taxes 44.2 % (59.6) % 104.7 % |
Reconciliation of the total amounts of unrecognized tax benefits | The following is a tabular reconciliation of the total amounts of unrecognized tax benefits for the fiscal years indicated (in thousands): Fiscal Year 2020 2019 2018 Balance at beginning of year $ 35,676 $ 39,909 $ 35,355 Gross increases—tax positions in prior years 1,241 6,639 7,183 Gross decreases—tax positions in prior years (4,281) (4) (124) Gross increases—tax positions in current year 857 184 576 Settlements — (1,901) — Lapse in statute of limitations (2,255) (8,912) (2,980) Change due to currency revaluation 302 (239) (101) Balance at end of year $ 31,540 $ 35,676 $ 39,909 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Jan. 02, 2021 | |
Leases [Abstract] | |
Components of leases | The components of lease expense were as follows (in thousands): Lease Cost Consolidated Fiscal Year 2020 Fiscal Year 2019 Operating lease cost (1) SG&A $ 106,004 $ 117,932 Finance lease cost: Amortization of ROU assets SG&A $ 506 $ 475 Interest on lease liabilities Interest expense $ 33 $ 38 Short-term lease cost SG&A $ 610 $ 1,302 Variable lease cost SG&A $ 22,048 $ 36,476 _______________________________________________ (1) Includes sublease income, which was immaterial. The following table discloses supplemental balance sheet information for the Company’s leases (in thousands): Leases Consolidated Balance Sheets Location January 2, 2021 December 28, 2019 Assets Operating Operating lease right-of-use assets $ 226,815 $ 288,166 Finance Property, plant and equipment - net of accumulated depreciation of $4,882 and $4,015 at January 2, 2021 and December 28, 2019, respectively $ 5,991 $ 5,918 Liabilities Current: Operating Current operating lease liabilities $ 64,851 $ 68,838 Finance Short-term and current portion of long-term debt $ 1,088 $ 1,011 Noncurrent: Operating Long-term operating lease liabilities $ 230,635 $ 288,689 Finance Long-term debt $ 569 $ 1,468 The following table discloses the weighted-average remaining lease term and weighted-average discount rate for the Company's leases: Lease Term and Discount Rate January 2, 2021 December 28, 2019 Weighted-average remaining lease term: Operating leases 5.9 years 6.1 years Finance leases 1.2 years 2.3 years Weighted-average discount rate: Operating leases 14.0 % 13.9 % Finance leases 1.2 % 1.2 % |
Maturity of lease liabilities | Future minimum lease payments by year as of January 2, 2021 were as follows (in thousands): Fiscal Year Operating Leases Finance Leases 2021 $ 101,507 $ 1,095 2022 85,753 569 2023 66,909 — 2024 46,656 — 2025 33,012 — Thereafter 122,318 — Total lease payments $ 456,155 $ 1,664 Less: Interest 160,669 6 Total lease obligations $ 295,486 $ 1,658 Future minimum lease payments by year as of December 28, 2019 were as follows (in thousands): Fiscal Year Operating Leases Finance Leases 2020 $ 116,778 $ 1,042 2021 94,795 978 2022 81,536 488 2023 64,582 — 2024 45,846 — Thereafter 153,255 — Total lease payments $ 556,792 $ 2,508 Less: Interest 199,265 30 Finance lease obligations $ 357,527 $ 2,478 |
Maturity of lease liabilities | Future minimum lease payments by year as of January 2, 2021 were as follows (in thousands): Fiscal Year Operating Leases Finance Leases 2021 $ 101,507 $ 1,095 2022 85,753 569 2023 66,909 — 2024 46,656 — 2025 33,012 — Thereafter 122,318 — Total lease payments $ 456,155 $ 1,664 Less: Interest 160,669 6 Total lease obligations $ 295,486 $ 1,658 Future minimum lease payments by year as of December 28, 2019 were as follows (in thousands): Fiscal Year Operating Leases Finance Leases 2020 $ 116,778 $ 1,042 2021 94,795 978 2022 81,536 488 2023 64,582 — 2024 45,846 — Thereafter 153,255 — Total lease payments $ 556,792 $ 2,508 Less: Interest 199,265 30 Finance lease obligations $ 357,527 $ 2,478 |
Supplemental Cash Flow Information | Supplemental cash flow information related to leases was as follows (in thousands): Fiscal Year 2020 Fiscal Year 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 131,499 $ 116,846 Operating cash flows from finance leases 33 38 Financing cash flows from finance leases 1,051 945 Leased assets obtained in exchange for new finance lease liabilities 49 83 Leased assets obtained in exchange for new operating lease liabilities 26,474 41,510 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Jan. 02, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of future minimum royalty commitments under license agreements | The Company has future minimum royalty commitments through fiscal year 2028 under these license agreements as follows by fiscal year (in thousands): Fiscal Year Minimum Royalty 2021 $ 112,639 2022 20,304 2023 20,880 2024 19,035 2025 17,040 Thereafter 7,710 Total $ 197,608 |
Summary of changes in the Company's asset retirement obligations | The following table summarizes the changes in the Company's asset retirement obligations (in thousands): Fiscal Year 2020 2019 Beginning asset retirement obligation $ 12,093 $ 11,862 Additions and changes in estimate 1,542 563 Liabilities settled during the period (933) (681) Accretion expense 325 366 Currency translation 818 (17) Ending asset retirement obligations $ 13,845 $ 12,093 |
Employee Benefit Plans (Tables)
Employee Benefit Plans (Tables) | 12 Months Ended |
Jan. 02, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Summary of stock options and stock appreciation rights activity | The following table summarizes stock option, stock appreciation rights and performance stock appreciation rights activity: Stock Options and Stock Appreciation Rights Shares Weighted-Average Weighted-Average Aggregate in thousands in thousands Outstanding at December 30, 2017 2,177 $ 50.01 5.3 $ — Granted — — Exercised (21) 14.46 37 Forfeited or expired (226) 59.58 Outstanding at December 29, 2018 1,930 49.25 1.3 37 Granted — — Exercised (13) 13.65 18 Forfeited or expired (1,408) 39.84 Outstanding at December 28, 2019 509 76.13 2.5 — Granted — — Exercised — — — Forfeited or expired (126) 79.44 Outstanding at January 2, 2021 383 75.05 1.9 — Exercisable at January 2, 2021 383 $ 75.05 1.9 $ — |
Summary of stock options and stock appreciation rights outstanding and exercisable | The following tables summarize information with respect to stock options, stock appreciation rights and performance stock appreciation rights outstanding and exercisable at January 2, 2021: Stock Options Outstanding Stock Options Range of Exercise Prices Number of Weighted-Average Weighted-Average Number of Weighted- in thousands in thousands $55.04 - $82.55 44 81.23 0.2 44 81.23 $95.91 - $131.46 62 128.11 1.1 62 128.11 Total 106 $ 108.76 0.8 106 $ 108.76 Stock Appreciation Rights Outstanding Stock Appreciation Range of Exercise Prices Number of Weighted-Average Weighted-Average Number of Weighted- in thousands in thousands $29.49 - $47.99 166 41.77 2.9 166 41.77 $55.04 - $82.55 59 77.98 1.9 59 77.98 $95.91 - $113.04 52 109.71 0.8 52 109.71 Total 277 $ 62.17 2.3 277 $ 62.17 |
Summary of restricted stock and restricted stock unit activity | The following table summarizes restricted stock, restricted stock unit and performance restricted stock unit activity: Restricted Stock, Restricted Stock Units and Performance Restricted Stock Units Number of Weighted-Average in thousands Nonvested at December 30, 2017 2,981 $ 20.84 Granted 1,456 14.35 Vested (1,040) 25.21 Forfeited (386) 19.87 Nonvested at December 29, 2018 3,011 $ 17.86 Granted 1,008 13.01 Vested (1,293) 17.92 Forfeited (397) 21.49 Nonvested at December 28, 2019 2,329 $ 15.16 Granted 1,124 3.76 Vested (1,127) 16.42 Forfeited (590) 12.42 Nonvested at January 2, 2021 1,736 $ 7.90 |
Supplemental Cash Flow Inform_2
Supplemental Cash Flow Information (Tables) | 12 Months Ended |
Jan. 02, 2021 | |
Supplemental Cash Flow Elements [Abstract] | |
Summary of supplemental cash flow information | The following table summarizes supplemental cash flow information (in thousands): Fiscal Year 2020 2019 2018 Cash paid during the year for: Interest $ 21,194 $ 25,310 $ 38,855 Income taxes, net of refunds $ 10,027 $ 18,025 $ 28,460 Supplemental disclosures of non-cash investing and financing activities: Additions to property, plant and equipment included in accounts payable $ 1,034 $ 2,060 $ 3,868 Additions to property, plant and equipment acquired under finance leases $ 49 $ 83 $ — |
Supplemental Disclosure for A_2
Supplemental Disclosure for Accumulated Other Comprehensive Income (Loss) (Tables) | 12 Months Ended |
Jan. 02, 2021 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Schedule of changes in components of accumulated other comprehensive income (loss), net of taxes | The following table illustrates changes in the balances of each component of accumulated other comprehensive income (loss), net of taxes (in thousands): January 2, 2021 Cash Flow Hedges Currency Forward Pension Total Beginning balance $ (80,474) $ 2,983 $ (3,124) $ (80,615) Other comprehensive income (loss) before reclassifications 19,296 2,278 5,057 26,631 Tax (expense) benefit — (61) (505) (566) Amounts reclassed from accumulated other comprehensive income (loss) — 4,781 — 4,781 Tax (expense) benefit — (431) — (431) Total other comprehensive income (loss) 19,296 (2,133) 4,552 21,715 Ending balance $ (61,178) $ 850 $ 1,428 $ (58,900) December 28, 2019 Cash Flow Hedges Currency Forward Pension Total Beginning balance $ (74,868) $ 8,582 $ 1,595 $ (64,691) Other comprehensive income (loss) before reclassifications (5,606) 6,510 (5,165) (4,261) Tax (expense) benefit — (450) 446 (4) Amounts reclassed from accumulated other comprehensive income (loss) — 12,688 — 12,688 Tax (expense) benefit — (1,029) — (1,029) Total other comprehensive income (loss) (5,606) (5,599) (4,719) (15,924) Ending balance $ (80,474) $ 2,983 $ (3,124) $ (80,615) December 29, 2018 Cash Flow Hedges Currency Forward Pension Total Beginning balance $ (64,499) $ (10,098) $ (1,672) $ (76,269) Other comprehensive income (loss) before reclassifications (10,369) 18,044 3,757 11,432 Tax (expense) benefit — — (490) (490) Amounts reclassed from accumulated other comprehensive income (loss) — (4,283) — (4,283) Tax (expense) benefit — 1,654 — 1,654 Total other comprehensive income (loss) (10,369) 20,673 3,267 13,571 Adoption of ASU 2018-02 — (1,993) — (1,993) Ending balance $ (74,868) $ 8,582 $ 1,595 $ (64,691) |
Major Customer, Segment and G_2
Major Customer, Segment and Geographic Information (Tables) | 12 Months Ended |
Jan. 02, 2021 | |
Segment Reporting [Abstract] | |
Summary information by operating segment | Summary information by operating segment was as follows (in thousands): Fiscal Year 2020 Net Sales Operating Depreciation Long-term Total Assets Americas $ 642,213 $ 32,998 $ 10,692 $ 112,934 $ 319,586 Europe 522,364 19,482 12,222 135,190 328,246 Asia 434,351 62,589 6,174 82,122 234,770 Corporate 14,415 (250,388) 13,162 157,784 595,903 Consolidated $ 1,613,343 $ (135,319) $ 42,250 $ 488,030 $ 1,478,505 Fiscal Year 2019 Net Sales Operating Depreciation Long-term Total Assets Americas $ 949,965 $ 66,703 $ 15,104 $ 164,097 $ 474,428 Europe 715,494 88,323 15,099 171,952 406,603 Asia 535,156 101,209 6,724 89,434 298,034 Corporate 17,097 (284,618) 16,515 119,791 425,667 Consolidated $ 2,217,712 $ (28,383) $ 53,442 $ 545,274 $ 1,604,732 Fiscal Year 2018 Net Sales Operating Depreciation Long-term Total Assets Americas $ 1,174,507 $ 185,094 $ 16,542 $ 61,914 $ 393,273 Europe 856,291 129,610 18,933 99,253 353,797 Asia 505,473 87,515 8,016 29,990 173,666 Corporate 5,217 (339,508) 23,588 125,472 654,462 Consolidated $ 2,541,488 $ 62,711 $ 67,079 $ 316,629 $ 1,575,198 |
Schedule of revenue for each class of similar products | The following table shows revenue for each class of similar products for fiscal years 2020, 2019 and 2018 (in thousands): Fiscal Year 2020 Fiscal Year 2019 Fiscal Year 2018 Net Sales Percentage Net Sales Percentage Net Sales Percentage Watches $ 1,299,846 80.6 % $ 1,802,481 81.3 % $ 2,033,021 80.0 % Leathers 173,621 10.7 238,619 10.8 289,385 11.4 Jewelry 102,917 6.4 123,177 5.6 167,775 6.6 Other 36,959 2.3 53,435 2.3 51,307 2.0 Total $ 1,613,343 100.0 % $ 2,217,712 100.0 % $ 2,541,488 100.0 % |
Schedule of net sales and long-lived assets by geographic area | Net sales and long-lived assets related to the Company's operations in the U.S., Europe, Asia and all other international markets were as follows (in thousands): Fiscal Year 2020 Net Sales (1) Long-term United States $ 546,753 $ 234,325 Europe 525,333 (2) 147,208 Asia 436,570 (3) 89,144 All other international 104,687 17,353 Consolidated $ 1,613,343 $ 488,030 Fiscal Year 2019 Net Sales (1) Long-term United States $ 819,825 $ 239,032 Europe 718,216 (2) 184,507 Asia 537,503 (3) 99,565 All other international 142,168 22,170 Consolidated $ 2,217,712 $ 545,274 Fiscal Year 2018 Net Sales (1) Long-term United States $ 1,017,919 $ 159,062 Europe 857,972 (2) 111,964 Asia 507,523 (3) 36,945 All other international 158,074 8,658 Consolidated $ 2,541,488 $ 316,629 _______________________________________________________________________________ (1) Net sales are based on the location of the selling entity (including exports). (2) Net sales from Germany (including exports) accounted for more than 10% of the Company's consolidated net sales and were approximately $225.5 million, $310.1 million and $359.9 million in fiscal years 2020, 2019 and 2018, respectively. (3) Net sales from China (including Hong Kong, Macau and Taiwan and exports) accounted for more than 10% of the Company's consolidated net sales in fiscal year 2020 and were approximately $228.4 million, $218.1 million and $190.0 million in fiscal years 2020, 2019 and 2018, respectively. |
Restructuring (Tables)
Restructuring (Tables) | 12 Months Ended |
Jan. 02, 2021 | |
Restructuring and Related Activities [Abstract] | |
Schedule of rollforward of the liability incurred for restructuring plan | The following tables show a rollforward of the accrued liability related to the Company’s NWF 2.0 restructuring plan (in thousands): Fiscal Year 2020 Liabilities Cash Payments Non-cash Items Liabilities December 28, 2019 Charges January 2, 2021 Store closures $ 22 $ 4,347 $ 1,597 $ 2,532 $ 240 Professional services 2,824 7,503 8,047 — 2,280 Severance and employee-related benefits 4,238 24,658 21,155 — 7,741 Total $ 7,084 $ 36,508 $ 30,799 $ 2,532 $ 10,261 Fiscal Year 2019 Liabilities Cash Payments Non-cash Items Liabilities December 29, 2018 Charges December 28, 2019 Store closures $ — $ 597 $ — $ 575 $ 22 Professional services — 8,039 5,215 — 2,824 Severance and employee-related benefits — 10,195 5,957 — 4,238 Total $ — $ 18,831 $ 11,172 $ 575 $ 7,084 The following table shows a rollforward of the accrued liability related to the Company’s NWF 1.0 restructuring plan (in thousands): Fiscal Year 2019 Liabilities Cash Payments Non-cash Items Liabilities December 29, 2018 Charges December 28, 2019 Store closures $ 2,818 $ 2,971 $ 1,673 $ 2,253 $ 1,863 Professional services 2,198 485 1,368 — 1,315 Severance and employee-related benefits 3,011 7,349 7,460 2,368 532 Total $ 8,027 $ 10,805 $ 10,501 $ 4,621 $ 3,710 |
Schedule of restructuring charges by operating segment | NWF 2.0 restructuring charges by operating segment were as follows (in thousands): 2020 2019 Americas $ 4,969 $ 2,048 Europe 12,630 9,333 Asia 8,823 773 Corporate 10,086 6,677 Consolidated $ 36,508 $ 18,831 NWF 1.0 restructuring charges by operating segment were as follows (in thousands): 2019 2018 Americas $ 2,941 $ 17,197 Europe 1,272 10,116 Asia 793 2,946 Corporate 5,799 16,371 Consolidated $ 10,805 $ 46,630 |
Significant Accounting Polici_4
Significant Accounting Policies - Concentration of Risk (Details) | 12 Months Ended | ||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | |
Watches | Production | Production concentration | |||
Concentration of Risk | |||
Concentration risk percentage | 43.00% | ||
Licensed products | Sales of licensed products | Licensed products | |||
Concentration of Risk | |||
Concentration risk percentage | 47.30% | 45.70% | 46.60% |
MICHAEL KORS | Sales of licensed products | Licensed products | |||
Concentration of Risk | |||
Concentration risk percentage | 17.00% | 19.20% | 22.60% |
ARMANI | Sales of licensed products | Licensed products | |||
Concentration of Risk | |||
Concentration risk percentage | 19.10% | 15.20% | 12.00% |
Significant Accounting Polici_5
Significant Accounting Policies - Schedule of Cash and Cash Equivalents (Details) - USD ($) $ in Thousands | Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | Dec. 30, 2017 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Cash and cash equivalents | $ 315,965 | $ 200,218 | $ 403,373 | |
Restricted cash included in prepaid expenses and other current assets | 121 | 30 | 31 | |
Restricted cash included in intangible and other assets-net | 8,160 | 7,501 | 7,479 | |
Cash, cash equivalents and restricted cash | $ 324,246 | $ 207,749 | $ 410,883 | $ 231,655 |
Significant Accounting Polici_6
Significant Accounting Policies - Accounts Receivable (Details) - USD ($) $ in Millions | Jan. 02, 2021 | Dec. 28, 2019 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Allowance for doubtful accounts receivable | $ 20.8 | $ 13.2 |
Significant Accounting Polici_7
Significant Accounting Policies - Inventories (Details) - USD ($) $ in Millions | Jan. 02, 2021 | Dec. 28, 2019 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Consigned inventory | $ 46 | $ 51 |
Significant Accounting Polici_8
Significant Accounting Policies - Investments (Details) - USD ($) $ in Millions | Jan. 02, 2021 | Dec. 28, 2019 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Cost method investments | $ 0.3 | $ 0.5 |
Significant Accounting Polici_9
Significant Accounting Policies - Leases (Details) - USD ($) $ in Millions | 12 Months Ended | |
Jan. 02, 2021 | Dec. 28, 2019 | |
Selling, general and administrative | ||
Lessee, Lease, Description [Line Items] | ||
Lease impairment loss | $ 27.3 | $ 7.9 |
Restructuring charges | ||
Lessee, Lease, Description [Line Items] | ||
Lease impairment loss | $ 2.9 | $ 1.7 |
Significant Accounting Polic_10
Significant Accounting Policies - Property, Plant and Equipment (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | |
Buildings | |||
Property, plant and equipment | |||
Useful life | 30 years | ||
Machinery and equipment | |||
Property, plant and equipment | |||
Useful life | 5 years | ||
Furniture and fixtures | |||
Property, plant and equipment | |||
Useful life | 5 years | ||
Computer equipment and software | Minimum | |||
Property, plant and equipment | |||
Useful life | 2 years | ||
Computer equipment and software | Maximum | |||
Property, plant and equipment | |||
Useful life | 7 years | ||
Selling, general and administrative | Retail stores | |||
Property, plant and equipment | |||
Impairment losses | $ 4 | $ 0.7 | $ 1.9 |
Restructuring charges | |||
Property, plant and equipment | |||
Loss on disposal of assets | 0.1 | 0.5 | 0.6 |
Restructuring charges | Retail stores | |||
Property, plant and equipment | |||
Impairment losses | $ 1.1 | $ 0.6 | $ 1.7 |
Significant Accounting Polic_11
Significant Accounting Policies - Goodwill and Other Intangible Assets (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | |
Trade Names, SKAGEN | |||
Finite lived intangible assets | |||
Indefinite-lived intangible assets (excluding goodwill) | $ 21.1 | ||
Indefinite-lived intangible assets (excluding goodwill), fair value disclosure | 4.5 | ||
Impairment charges | $ 16.6 | $ 6.2 | |
Minimum | |||
Finite lived intangible assets | |||
Useful lives | 3 years | ||
Maximum | |||
Finite lived intangible assets | |||
Useful lives | 20 years |
Significant Accounting Polic_12
Significant Accounting Policies - Foreign Transaction Gains and Losses (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Foreign currency transaction gains (losses) | $ (6,481) | $ 3,932 | $ (5,820) |
Significant Accounting Polic_13
Significant Accounting Policies - Revenues (Details) - USD ($) $ in Millions | 12 Months Ended | |
Jan. 02, 2021 | Dec. 28, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Estimated sales return provision | $ 49.8 | $ 77.5 |
Significant Accounting Polic_14
Significant Accounting Policies - Advertising Costs (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Advertising costs | $ 126.3 | $ 171 | $ 181 |
Significant Accounting Polic_15
Significant Accounting Policies - Research and Development Costs (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Research and development costs | $ 25.9 | $ 32.4 | $ 38.2 |
Significant Accounting Polic_16
Significant Accounting Policies - Earnings (Loss) Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | |
Numerator: | |||
Net Income (Loss) Available to Common Stockholders, Basic | $ (96,095) | $ (52,365) | $ (3,478) |
Denominator: | |||
Basic weighted average common shares outstanding (in shares) | 51,116 | 50,230 | 49,196 |
Basic EPS (in dollars per share) | $ (1.88) | $ (1.04) | $ (0.07) |
Diluted EPS computation: | |||
Basic weighted average common shares outstanding (in shares) | 51,116 | 50,230 | 49,196 |
Diluted weighted average common shares outstanding (in shares) | 51,116 | 50,230 | 49,196 |
Diluted EPS (in dollars per share) | $ (1.88) | $ (1.04) | $ (0.07) |
Stock Compensation Plan | |||
Diluted EPS computation: | |||
Shares issuable under stock-based awards not included in the diluted EPS calculation (in shares) | 2,400 | 3,400 | 5,100 |
Performance Shares | |||
Diluted EPS computation: | |||
Shares issuable under stock-based awards not included in the diluted EPS calculation (in shares) | 300 | 600 | 1,200 |
Significant Accounting Polic_17
Significant Accounting Policies - Recently Issued and Adopted Accounting Standards (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | Dec. 30, 2017 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Operating lease right-of-use assets | $ 226,815 | $ 288,166 | ||
Operating lease liability | 295,486 | 357,527 | ||
Cost of sales | 842,987 | 1,118,274 | $ 1,201,351 | |
Stockholders' equity, including portion attributable to noncontrolling interest | 440,032 | 503,841 | 588,631 | $ 580,947 |
Retained Earnings | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Stockholders' equity, including portion attributable to noncontrolling interest | $ 203,698 | $ 299,793 | $ 381,626 | $ 409,653 |
Revenue - Narrative (Details)
Revenue - Narrative (Details) - USD ($) | 12 Months Ended | |
Jan. 02, 2021 | Dec. 28, 2019 | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Material contract assets | $ 0 | |
Deferred contract costs | 0 | |
Contract liabilities | $ 9,900,000 | $ 13,400,000 |
Online Dashboard, Mobile Applications, and Upgrade Rights | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Estimated usage period | 2 years | |
Wearable Technology | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Contract liabilities | $ 4,600,000 | 5,300,000 |
Gift Cards | ||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||
Contract liabilities | $ 4,200,000 | $ 3,300,000 |
Revenue - Disaggregation of Rev
Revenue - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | |
Disaggregation of Revenue [Line Items] | |||
Net sales | $ 1,613,343 | $ 2,217,712 | $ 2,541,488 |
Revenue recognized at a point in time | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 1,599,925 | 2,201,957 | 2,536,852 |
Revenue recognized over time | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 13,418 | 15,755 | 4,636 |
Watches | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 1,299,846 | 1,802,481 | 2,033,021 |
Leathers | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 173,621 | 238,619 | 289,385 |
Jewelry | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 102,917 | 123,177 | 167,775 |
Other | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 36,959 | 53,435 | 51,307 |
Operating segments | Americas | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 642,213 | 949,965 | 1,174,507 |
Operating segments | Americas | Revenue recognized at a point in time | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 639,948 | 947,353 | 1,172,200 |
Operating segments | Americas | Revenue recognized over time | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 2,265 | 2,612 | 2,307 |
Operating segments | Americas | Watches | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 507,278 | 769,581 | 936,875 |
Operating segments | Americas | Leathers | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 104,621 | 145,632 | 171,808 |
Operating segments | Americas | Jewelry | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 23,959 | 24,826 | 50,266 |
Operating segments | Americas | Other | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 6,355 | 9,926 | 15,558 |
Operating segments | Europe | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 522,364 | 715,494 | 856,291 |
Operating segments | Europe | Revenue recognized at a point in time | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 520,878 | 714,056 | 855,219 |
Operating segments | Europe | Revenue recognized over time | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 1,486 | 1,438 | 1,072 |
Operating segments | Europe | Watches | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 404,520 | 557,460 | 656,948 |
Operating segments | Europe | Leathers | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 36,570 | 47,308 | 67,264 |
Operating segments | Europe | Jewelry | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 71,209 | 92,935 | 111,603 |
Operating segments | Europe | Other | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 10,065 | 17,791 | 20,476 |
Operating segments | Asia | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 434,351 | 535,156 | 505,473 |
Operating segments | Asia | Revenue recognized at a point in time | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 433,648 | 534,403 | 504,956 |
Operating segments | Asia | Revenue recognized over time | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 703 | 753 | 517 |
Operating segments | Asia | Watches | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 388,004 | 475,361 | 439,029 |
Operating segments | Asia | Leathers | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 32,430 | 45,679 | 50,313 |
Operating segments | Asia | Jewelry | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 7,749 | 5,416 | 5,906 |
Operating segments | Asia | Other | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 6,168 | 8,700 | 10,225 |
Corporate | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 14,415 | 17,097 | 5,217 |
Corporate | Revenue recognized at a point in time | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 5,451 | 6,145 | 4,477 |
Corporate | Revenue recognized over time | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 8,964 | 10,952 | 740 |
Corporate | Watches | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 44 | 79 | 169 |
Corporate | Leathers | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 0 | 0 | 0 |
Corporate | Jewelry | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 0 | 0 | 0 |
Corporate | Other | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | $ 14,371 | $ 17,018 | $ 5,048 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Jan. 02, 2021 | Dec. 28, 2019 |
Inventory Disclosure [Abstract] | ||
Components and parts | $ 25,016 | $ 35,626 |
Work-in-process | 7,913 | 11,034 |
Finished goods | 262,367 | 405,618 |
Inventories | $ 295,296 | $ 452,278 |
Warranty Liabilities (Details)
Warranty Liabilities (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | Dec. 30, 2017 | |
Warranty liability activity | ||||
Beginning balance | $ 23,095 | $ 22,807 | $ 19,405 | |
Settlements in cash or kind | (14,843) | (18,073) | (15,197) | |
Warranties issued and adjustments to preexisting warranties | 13,664 | 18,361 | 18,599 | |
Ending balance | $ 21,916 | $ 23,095 | $ 22,807 | $ 19,405 |
FOSSIL watch products | ||||
Product Information [Line Items] | ||||
Warranty period | 11 years | |||
RELIC watch products | ||||
Product Information [Line Items] | ||||
Warranty period | 12 years | |||
FOSSIL, RELIC, and SKAGEN watch products | ||||
Product Information [Line Items] | ||||
Warranty period | 2 years | |||
Other non-watch products | Minimum | ||||
Product Information [Line Items] | ||||
Warranty period | 1 year | |||
Other non-watch products | Maximum | ||||
Product Information [Line Items] | ||||
Warranty period | 2 years |
Prepaid Expenses and Other Cu_3
Prepaid Expenses and Other Current Assets (Details) - USD ($) $ in Thousands | Jan. 02, 2021 | Dec. 28, 2019 |
Prepaid Expense and Other Assets, Current [Abstract] | ||
Prepaid royalties | $ 24,391 | $ 22,258 |
Prepaid taxes | 27,280 | 34,712 |
Current income tax receivable | 37,674 | 0 |
Other receivables | 8,230 | 10,581 |
Forward contracts | 345 | 3,327 |
Inventory returns | 16,650 | 22,402 |
Property held for sale | 10,359 | 0 |
Short term deposits | 1,238 | 1,530 |
Other | 23,200 | 22,408 |
Prepaid expenses and other current assets | $ 149,367 | $ 117,218 |
Property, Plant and Equipment_2
Property, Plant and Equipment (Details) - USD ($) $ in Thousands | Jan. 02, 2021 | Dec. 28, 2019 |
Property, plant and equipment | ||
Property, plant and equipment - gross | $ 581,201 | $ 616,413 |
Less accumulated depreciation and amortization | 467,175 | 464,913 |
Property, plant and equipment-net | 114,026 | 151,500 |
Land | ||
Property, plant and equipment | ||
Property, plant and equipment - gross | 5,833 | 7,579 |
Buildings | ||
Property, plant and equipment | ||
Property, plant and equipment - gross | 31,474 | 37,012 |
Machinery and equipment | ||
Property, plant and equipment | ||
Property, plant and equipment - gross | 41,327 | 39,756 |
Furniture and fixtures | ||
Property, plant and equipment | ||
Property, plant and equipment - gross | 93,423 | 96,940 |
Computer equipment and software | ||
Property, plant and equipment | ||
Property, plant and equipment - gross | 225,352 | 235,757 |
Leasehold improvements | ||
Property, plant and equipment | ||
Property, plant and equipment - gross | 182,169 | 192,114 |
Construction in progress | ||
Property, plant and equipment | ||
Property, plant and equipment - gross | $ 1,623 | $ 7,255 |
Intangible and Other Assets (In
Intangible and Other Assets (Intangible and Other Assets) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 02, 2021 | Dec. 28, 2019 | |
Intangibles-subject to amortization: | ||
Gross amount | $ 55,772 | $ 65,515 |
Accumulated amortization | 46,913 | 49,951 |
Intangibles-not subject to amortization: | ||
Gross amount | 8,895 | 11,315 |
Other assets: | ||
Gross amount | 129,435 | 78,729 |
Gross amount | 194,102 | 155,559 |
Accumulated amortization | 46,913 | 49,951 |
Total intangible and other assets-net | 147,189 | 105,608 |
Other deposits | ||
Other assets: | ||
Gross amount | 19,762 | 18,558 |
Deferred compensation plan assets | ||
Other assets: | ||
Gross amount | 6,257 | 5,243 |
Deferred tax asset-net | ||
Other assets: | ||
Gross amount | 33,893 | 38,275 |
Restricted cash | ||
Other assets: | ||
Gross amount | 8,159 | 7,501 |
Tax receivable | ||
Other assets: | ||
Gross amount | 58,734 | 6,507 |
Investments | ||
Other assets: | ||
Gross amount | 327 | 500 |
Other | ||
Other assets: | ||
Gross amount | $ 2,303 | 2,145 |
Minimum | ||
Intangibles-subject to amortization: | ||
Useful lives | 3 years | |
Maximum | ||
Intangibles-subject to amortization: | ||
Useful lives | 20 years | |
Trademarks | ||
Intangibles-subject to amortization: | ||
Useful lives | 10 years | |
Gross amount | $ 3,775 | 3,612 |
Accumulated amortization | 3,198 | 2,993 |
Customer lists | ||
Intangibles-subject to amortization: | ||
Gross amount | 42,387 | 52,517 |
Accumulated amortization | $ 39,406 | 44,013 |
Customer lists | Minimum | ||
Intangibles-subject to amortization: | ||
Useful lives | 5 years | |
Customer lists | Maximum | ||
Intangibles-subject to amortization: | ||
Useful lives | 10 years | |
Patents | ||
Intangibles-subject to amortization: | ||
Gross amount | $ 2,371 | 2,308 |
Accumulated amortization | $ 1,973 | 1,937 |
Patents | Minimum | ||
Intangibles-subject to amortization: | ||
Useful lives | 3 years | |
Patents | Maximum | ||
Intangibles-subject to amortization: | ||
Useful lives | 20 years | |
Developed technology | ||
Intangibles-subject to amortization: | ||
Useful lives | 7 years | |
Gross amount | $ 2,193 | 2,193 |
Accumulated amortization | $ 1,097 | 548 |
Trade name | ||
Intangibles-subject to amortization: | ||
Useful lives | 6 years | |
Gross amount | $ 4,502 | 4,502 |
Accumulated amortization | 938 | 188 |
Other | ||
Intangibles-subject to amortization: | ||
Gross amount | 544 | 383 |
Accumulated amortization | $ 301 | $ 272 |
Other | Minimum | ||
Intangibles-subject to amortization: | ||
Useful lives | 7 years | |
Other | Maximum | ||
Intangibles-subject to amortization: | ||
Useful lives | 20 years |
Intangible and Other Assets (Na
Intangible and Other Assets (Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | |
Jan. 02, 2021 | Dec. 29, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization expense for intangible assets | $ 7.1 | $ 11.9 |
Intangible and Other Assets (Am
Intangible and Other Assets (Amortization Expense) (Details) $ in Thousands | Jan. 02, 2021USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2021 | $ 3,384 |
2022 | 2,531 |
2023 | 909 |
2024 | 896 |
2025 | $ 1,139 |
Derivatives and Risk Manageme_3
Derivatives and Risk Management - Cash Flow Hedges (Details) € in Millions, ¥ in Millions, £ in Millions, $ in Millions, $ in Millions, $ in Millions | 12 Months Ended | |||||||
Jan. 02, 2021USD ($) | Dec. 28, 2019USD ($) | Jan. 02, 2021EUR (€) | Jan. 02, 2021CAD ($) | Jan. 02, 2021GBP (£) | Jan. 02, 2021MXN ($) | Jan. 02, 2021JPY (¥) | Jan. 02, 2021AUD ($) | |
Derivative [Line Items] | ||||||||
Cash flow hedge gain (loss) reclassified into earnings | $ 0 | $ 0 | ||||||
Cash Flow Hedges | ||||||||
Derivative [Line Items] | ||||||||
Maximum period of future intercompany purchases | 24 months | |||||||
Percentage of forecasted purchases to manage fluctuations in global currencies (up to) | 85.00% | 85.00% | 85.00% | 85.00% | 85.00% | 85.00% | 85.00% | |
Cash Flow Hedges | Designated as cash flow hedges | Forward contracts | Euro | ||||||||
Derivative [Line Items] | ||||||||
Notional amount | $ 98,200,000 | € 81.3 | ||||||
Cash Flow Hedges | Designated as cash flow hedges | Forward contracts | Canadian dollar | ||||||||
Derivative [Line Items] | ||||||||
Notional amount | 17,100,000 | $ 22 | ||||||
Cash Flow Hedges | Designated as cash flow hedges | Forward contracts | British pound | ||||||||
Derivative [Line Items] | ||||||||
Notional amount | 11,800,000 | £ 8.8 | ||||||
Cash Flow Hedges | Designated as cash flow hedges | Forward contracts | Mexican peso | ||||||||
Derivative [Line Items] | ||||||||
Notional amount | 10,900,000 | $ 218.8 | ||||||
Cash Flow Hedges | Designated as cash flow hedges | Forward contracts | Japanese yen | ||||||||
Derivative [Line Items] | ||||||||
Notional amount | 9,500,000 | ¥ 985.6 | ||||||
Cash Flow Hedges | Designated as cash flow hedges | Forward contracts | Australian dollar | ||||||||
Derivative [Line Items] | ||||||||
Notional amount | 5,500,000 | $ 7.2 | ||||||
Cash Flow Hedges | Designated as cash flow hedges | Forward contracts | U.S. dollar | ||||||||
Derivative [Line Items] | ||||||||
Notional amount | $ 3,200,000 | ¥ 345 |
Derivatives and Risk Manageme_4
Derivatives and Risk Management - Non-designated Hedges (Details) - Not designated as hedging instruments - Forward contracts R in Millions, $ in Millions | Jan. 02, 2021USD ($) | Jan. 02, 2021ZAR (R) | Dec. 28, 2019USD ($) | Dec. 28, 2019ZAR (R) |
Derivative [Line Items] | ||||
Fair value of designated forward contracts | $ | $ 1.4 | $ 1.5 | ||
Hedged amount | R | R 21.9 | R 22.6 |
Derivatives and Risk Manageme_5
Derivatives and Risk Management - Gains and Losses on Cash Flow Hedges (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | |
Derivative [Line Items] | |||
Total gain (loss) recognized in other comprehensive income (loss), net of taxes | $ 2,217 | $ 6,060 | $ 18,044 |
Forward contracts | |||
Derivative [Line Items] | |||
Total gain (loss) recognized in other comprehensive income (loss), net of taxes | $ 2,217 | $ 6,060 | $ 18,044 |
Derivatives and Risk Manageme_6
Derivatives and Risk Management - Gains and Losses on Derivative Instruments (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | |
Forward contracts | Cost of sales | |||
Effective portion of gains and losses on derivative instruments | |||
Derivative instruments designated as cash flow hedging instruments, Total gain (loss) reclassified from accumulated other comprehensive income (loss) | $ 3,748 | $ 9,939 | |
Designated as cash flow hedges | Forward contracts | Cost of sales | |||
Effective portion of gains and losses on derivative instruments | |||
Derivative instruments designated as cash flow hedging instruments, Total gain (loss) reclassified from accumulated other comprehensive income (loss) | 3,748 | 9,939 | $ 0 |
Designated as cash flow hedges | Forward contracts | Other income (expense)-net | |||
Effective portion of gains and losses on derivative instruments | |||
Derivative instruments designated as cash flow hedging instruments, Total gain (loss) reclassified from accumulated other comprehensive income (loss) | 602 | 1,720 | (2,629) |
Not designated as hedging instruments | Forward contracts | Other income (expense)-net | |||
Effective portion of gains and losses on derivative instruments | |||
Derivative instruments not designated as hedging instruments, Total gain (loss) recognized in income | (113) | (88) | 244 |
Not designated as hedging instruments | Interest rate swaps | Other income (expense)-net | |||
Effective portion of gains and losses on derivative instruments | |||
Derivative instruments not designated as hedging instruments, Total gain (loss) recognized in income | $ 0 | $ 0 | $ 67 |
Derivatives and Risk Manageme_7
Derivatives and Risk Management - Fair Value Amounts for Derivative Instruments (Details) - USD ($) $ in Thousands | Jan. 02, 2021 | Dec. 28, 2019 |
Fair value of derivative instruments | ||
Asset derivatives | $ 393 | $ 3,348 |
Liability derivatives | 2,299 | 1,824 |
Forward contracts | Designated as cash flow hedges | Prepaid expenses and other current assets | ||
Fair value of derivative instruments | ||
Asset derivatives | 345 | 3,327 |
Forward contracts | Designated as cash flow hedges | Intangible and other assets-net | ||
Fair value of derivative instruments | ||
Asset derivatives | 48 | 21 |
Forward contracts | Designated as cash flow hedges | Accrued expenses-other | ||
Fair value of derivative instruments | ||
Liability derivatives | 2,178 | 1,657 |
Forward contracts | Designated as cash flow hedges | Other long-term liabilities | ||
Fair value of derivative instruments | ||
Liability derivatives | 35 | 104 |
Forward contracts | Not designated as hedging instruments | Prepaid expenses and other current assets | ||
Fair value of derivative instruments | ||
Asset derivatives | 0 | 0 |
Forward contracts | Not designated as hedging instruments | Accrued expenses-other | ||
Fair value of derivative instruments | ||
Liability derivatives | $ 86 | $ 63 |
Derivatives and Risk Manageme_8
Derivatives and Risk Management - Effect of Derivative Instruments on Earnings (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | |
Derivative [Line Items] | |||
Cost of sales | $ 842,987 | $ 1,118,274 | $ 1,201,351 |
Other income (expense) - net | (4,828) | 26,984 | $ (38) |
Loss expected to be reclassified into earnings within the next twelve months | 1,600 | ||
Forward contracts | Cost of Sales | |||
Derivative [Line Items] | |||
Total gain (loss) reclassified from other comprehensive income (loss) | 3,748 | 9,939 | |
Forward contracts | Other Operating Income (Expense) | |||
Derivative [Line Items] | |||
Total gain (loss) reclassified from other comprehensive income (loss) | 602 | 1,720 | |
Forward contracts | Other income (expense)-net | Not designated as hedging instruments | |||
Derivative [Line Items] | |||
Total gain (loss) recognized in income | $ (113) | $ (88) |
Fair Value Measurements (Assets
Fair Value Measurements (Assets and Liabilities) (Details) - USD ($) $ in Thousands | Jan. 02, 2021 | Dec. 28, 2019 |
Assets: | ||
Forward contracts | $ 393 | $ 3,348 |
Investment in publicly traded mutual funds | 6,257 | 5,243 |
Total | 6,650 | 8,591 |
Liabilities: | ||
Contingent consideration | 1,924 | 1,141 |
Forward contracts | 2,299 | 1,824 |
Total | 4,223 | 2,965 |
Level 1 | ||
Assets: | ||
Forward contracts | 0 | 0 |
Investment in publicly traded mutual funds | 6,257 | 5,243 |
Total | 6,257 | 5,243 |
Liabilities: | ||
Contingent consideration | 0 | 0 |
Forward contracts | 0 | 0 |
Total | 0 | 0 |
Level 2 | ||
Assets: | ||
Forward contracts | 393 | 3,348 |
Investment in publicly traded mutual funds | 0 | 0 |
Total | 393 | 3,348 |
Liabilities: | ||
Contingent consideration | 0 | 0 |
Forward contracts | 2,299 | 1,824 |
Total | 2,299 | 1,824 |
Level 3 | ||
Assets: | ||
Forward contracts | 0 | 0 |
Investment in publicly traded mutual funds | 0 | 0 |
Total | 0 | 0 |
Liabilities: | ||
Contingent consideration | 1,924 | 1,141 |
Forward contracts | 0 | 0 |
Total | $ 1,924 | $ 1,141 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Operating lease right-of-use assets | $ 226,815 | $ 288,166 | |
Property, plant and equipment-net | 114,026 | 151,500 | |
Present value of remaining purchase price | 1,900 | ||
Contingent consideration | 1,924 | 1,141 | |
Trade Names, SKAGEN | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Indefinite-lived intangible assets (excluding goodwill) | 21,100 | ||
Indefinite-lived intangible assets (excluding goodwill), fair value disclosure | 4,500 | ||
Impairment charges | 16,600 | $ 6,200 | |
Trade Names, MICHELE | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Indefinite-lived intangible assets (excluding goodwill) | 10,900 | ||
Indefinite-lived intangible assets (excluding goodwill), fair value disclosure | 8,400 | ||
Impairment charges | 2,500 | ||
Specific company-owned stores | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Operating lease right-of-use assets | 49,600 | 18,300 | |
Property, plant and equipment-net | 7,500 | 1,800 | |
Operating lease right-of-use asset | 19,400 | 8,700 | |
Property plant and equipment, fair value | 2,400 | 500 | |
Impairment charge | 35,300 | 10,900 | |
Specific company-owned stores | Selling, general and administrative | Americas | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Impairment charge | 23,000 | ||
Specific company-owned stores | Selling, general and administrative | Europe | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Impairment charge | 7,300 | ||
Specific company-owned stores | Selling, general and administrative | Asia | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Impairment charge | 1,000 | ||
Specific company-owned stores | Restructuring charges | Americas | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Impairment charge | 2,300 | ||
Specific company-owned stores | Restructuring charges | Europe | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Impairment charge | 900 | ||
Specific company-owned stores | Restructuring charges | Asia | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Impairment charge | 800 | ||
Level 3 | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Contingent consideration | 1,924 | $ 1,141 | |
Level 3 | Accounts Payable and Accrued Liabilities | Fair Value, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Contingent consideration | 100 | ||
Level 3 | Other Noncurrent Liabilities | Fair Value, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Contingent consideration | $ 1,800 |
Debt - Schedule of Debt (Detail
Debt - Schedule of Debt (Details) - USD ($) $ in Millions | Jan. 02, 2021 | Dec. 28, 2019 |
Debt Instrument [Line Items] | ||
Total gross debt | $ 250.8 | $ 228.2 |
Less current portion | 40.5 | 25.2 |
Long-term debt | 210.3 | 203 |
Debt issuance costs | 17.6 | |
Original issue discount | 7.4 | |
Line of credit | U.S. revolving line of credit | ||
Debt Instrument [Line Items] | ||
Total gross debt | 98.3 | 28 |
Debt issuance costs | 6.2 | 7.9 |
U.S. term loan | ||
Debt Instrument [Line Items] | ||
Total gross debt | 152 | 200 |
Debt issuance costs | 11.4 | 6.6 |
Original issue discount | 7.4 | 11.2 |
Other international | ||
Debt Instrument [Line Items] | ||
Total gross debt | $ 0.5 | $ 0.2 |
Debt - Narrative (Details)
Debt - Narrative (Details) | Jun. 05, 2020USD ($) | Feb. 20, 2020USD ($) | Sep. 26, 2019USD ($) | Jan. 02, 2021USD ($) | Apr. 03, 2021USD ($) | Jun. 23, 2016ZAR (R) |
Debt Instrument | ||||||
Total debt outstanding | $ 225,800,000 | |||||
Original issue discount | 7,400,000 | |||||
Debt issuance costs | 17,600,000 | |||||
Debt discount and debt issuance costs amortization | $ 10,600,000 | |||||
Debt instrument, face amount | R | R 25,000,000 | |||||
Debt instrument, interest rate, effective percentage | 7.00% | |||||
Revolving Facility | ||||||
Debt Instrument | ||||||
Net payments | $ 70,300,000 | |||||
Remaining borrowing capacity | 42,100,000 | |||||
Interest expense incurred | 1,900,000 | |||||
Term Credit Agreement | ||||||
Debt Instrument | ||||||
Debt issuance costs | $ 8,100,000 | |||||
U.S. term loan | ||||||
Debt Instrument | ||||||
Interest expense incurred | 17,600,000 | |||||
Revolving Facility | ||||||
Debt Instrument | ||||||
Maximum borrowing amount | $ 275,000,000 | |||||
Line of credit facility, issuance fee percentage | 0.125% | |||||
Line of credit facility, increase in maximum borrowing capacity | $ 75,000,000 | |||||
Line of credit facility, increase in maximum borrowing capacity minimum increment | $ 10,000,000 | |||||
Revolving Facility | Minimum | ||||||
Debt Instrument | ||||||
Line of credit facility, commitment fee percentage | 0.25% | |||||
Revolving Facility | Maximum | ||||||
Debt Instrument | ||||||
Line of credit facility, commitment fee percentage | 0.375% | |||||
Revolving Facility | Second A&R Credit Agreement | ||||||
Debt Instrument | ||||||
Remaining borrowing capacity as a percentage of accounts receivable | 60.00% | |||||
Revolving Facility | Term Credit Agreement | ||||||
Debt Instrument | ||||||
Line of credit facility, annual authorized prepayment amount | $ 200,000,000 | |||||
Revolving Facility | United States Accounts Receivable | Second A&R Credit Agreement | ||||||
Debt Instrument | ||||||
Remaining borrowing capacity as a percentage of accounts receivable | 85.00% | |||||
Revolving Facility | United States Credit Card Accounts Receivable | Second A&R Credit Agreement | ||||||
Debt Instrument | ||||||
Remaining borrowing capacity as a percentage of accounts receivable | 90.00% | |||||
Revolving Facility | Foreign Accounts Receivable | Second A&R Credit Agreement | ||||||
Debt Instrument | ||||||
Remaining borrowing capacity as a percentage of accounts receivable | 85.00% | |||||
Revolving Facility | French Accounts Receivable | Second A&R Credit Agreement | ||||||
Debt Instrument | ||||||
Remaining borrowing capacity as a percentage of accounts receivable | 85.00% | |||||
Revolving Facility | Net Liquidation Value | United States Finished Goods Inventory | Second A&R Credit Agreement | ||||||
Debt Instrument | ||||||
Remaining borrowing capacity as a percentage of accounts receivable | 90.00% | |||||
Revolving Facility | Net Liquidation Value | Foreign Finished Goods Inventory | Second A&R Credit Agreement | ||||||
Debt Instrument | ||||||
Remaining borrowing capacity as a percentage of accounts receivable | 90.00% | |||||
Revolving Facility | Lower Of Cost Or Market Value | United States Finished Goods Inventory | Second A&R Credit Agreement | ||||||
Debt Instrument | ||||||
Remaining borrowing capacity as a percentage of accounts receivable | 65.00% | |||||
Revolving Facility | Lower Of Cost Or Market Value | Foreign Finished Goods Inventory | Second A&R Credit Agreement | ||||||
Debt Instrument | ||||||
Remaining borrowing capacity as a percentage of accounts receivable | 65.00% | |||||
U.S. Credit Facility | ||||||
Debt Instrument | ||||||
Aggregate principal amount available | $ 160,000,000 | |||||
European Credit Facility | ||||||
Debt Instrument | ||||||
Maximum borrowing amount | 70,000,000 | |||||
Subfacility for swingline loans | 7,000,000 | |||||
Hong Kong Credit Facility | ||||||
Debt Instrument | ||||||
Maximum borrowing amount | 30,000,000 | |||||
French Credit Facility | ||||||
Debt Instrument | ||||||
Maximum borrowing amount | 10,000,000 | |||||
Subfacility for swingline loans | 1,000,000 | |||||
Canadian Credit Facility | ||||||
Debt Instrument | ||||||
Maximum borrowing amount | 5,000,000 | |||||
Letter of Credit | ||||||
Debt Instrument | ||||||
Subfacility for letters of credit | 45,000,000 | |||||
Term Loan Facility | ||||||
Debt Instrument | ||||||
Total debt outstanding | 200,000,000 | |||||
Original issue discount | 12,000,000 | |||||
Net borrowings under Term Loan | $ 48,000,000 | |||||
Term Loan Facility | Term Credit Agreement | ||||||
Debt Instrument | ||||||
Maximum total leverage ratio permitted | 1.50 | |||||
Line of credit facility, prepayment fee percentage, year one | 2.00% | |||||
Principal prepayment | $ 15,000,000 | |||||
Quarterly amortization payment, initial amount | 8,000,000 | $ 5,000,000 | ||||
Quarterly amortization payment, after September 30, 2020 | $ 10,000,000 | |||||
Period for waived prepayment fees (in days) | 90 days | |||||
Prepayment fee percentage, year two | 1.00% | |||||
Minimum liquidity level | $ 125,000,000 | $ 150,000,000 | ||||
Percentage of equity interests in foreign subsidiaries pledged as collateral | 1 | 0.65 | ||||
Term Loan Facility | Term Credit Agreement | Forecast | ||||||
Debt Instrument | ||||||
Line of credit facility, excess cash payment due | $ 12,000,000 | |||||
Term Loan Facility | Term Credit Agreement | LIBOR | ||||||
Debt Instrument | ||||||
Basis spread on base rate (as a percent) | 8.50% | 8.00% | 6.50% | |||
Term Loan Facility | Term Credit Agreement | Alternate Base Rate | ||||||
Debt Instrument | ||||||
Basis spread on base rate (as a percent) | 7.50% | 7.00% | 5.50% | |||
Term Loan Facility | Debt Covenant Period One | Term Credit Agreement | ||||||
Debt Instrument | ||||||
Maximum total leverage ratio permitted | 2.75 | |||||
Line of credit facility, prepayment fee percentage, year one | 2.00% | |||||
Term Loan Facility | Debt Covenant Period Two | Term Credit Agreement | ||||||
Debt Instrument | ||||||
Maximum total leverage ratio permitted | 2.25 | |||||
Line of credit facility, prepayment fee percentage, year one | 1.00% | |||||
Term Loan Facility | Debt Covenant Period Three | Term Credit Agreement | ||||||
Debt Instrument | ||||||
Maximum total leverage ratio permitted | 1.50 |
Debt - Schedule of Maturity of
Debt - Schedule of Maturity of Debt (Details) - USD ($) $ in Millions | Jan. 02, 2021 | Dec. 28, 2019 |
Debt Disclosure [Abstract] | ||
Less than 1 Year | $ 40.5 | |
Year 2 | 40 | |
Year 3 | 30 | |
Year 4 | 140.3 | |
Principal amounts repayable | 250.8 | $ 228.2 |
Debt issuance costs | (17.6) | |
Original issue discount | (7.4) | |
Total debt outstanding | $ 225.8 |
Other Income (Expense)_Net (Det
Other Income (Expense)—Net (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | |
Other Income and Expenses [Abstract] | |||
Interest income | $ 573 | $ 2,075 | $ 2,605 |
Contingent consideration remeasurement | (628) | 601 | 3,381 |
Equity in losses of unconsolidated investment | (345) | (371) | (558) |
Extinguishment of debt | 0 | (3,044) | (718) |
Gain on asset divestitures | 0 | 23,134 | 0 |
Net currency (losses) gains | (6,481) | 3,932 | (5,820) |
Other net gains | 2,053 | 657 | 1,072 |
Other income (expense) - net | $ (4,828) | $ 26,984 | $ (38) |
Taxes - Components of Consolida
Taxes - Components of Consolidated Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Jan. 02, 2021 | Dec. 28, 2019 |
Deferred income tax assets: | ||
Inventory | $ 4,095 | $ 6,856 |
Compensation | 14,028 | 11,998 |
Property, plant and equipment | 0 | 220 |
Trade names and customer lists | 5,163 | 4,345 |
Goodwill | 13,189 | 14,947 |
Foreign accruals | 12,582 | 10,446 |
Loss carryforwards | 54,112 | 32,158 |
Tax credit carryforwards | 2,771 | 4,281 |
Interest disallowance | 9,604 | 16,683 |
Lease liabilities | 54,857 | 82,511 |
Other | 19,042 | 36,302 |
Deferred income tax assets total | 189,443 | 220,747 |
Deferred income tax liabilities: | ||
Property, plant and equipment | (5,807) | 0 |
Undistributed earnings of certain foreign subsidiaries | (3,076) | (329) |
Right-of-use assets | (36,584) | (65,070) |
Other | (1,327) | (1,081) |
Deferred income tax liabilities total | (46,794) | (66,480) |
Valuation allowance | (109,250) | (118,089) |
Net deferred income tax assets | 33,399 | 36,178 |
Net deferred income tax assets | 33,894 | 38,275 |
Net deferred income tax liabilities | $ (495) | $ (2,097) |
Taxes - Narratives (Details)
Taxes - Narratives (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | |
Income tax contingency | |||
Deferred tax assets, loss carryforwards | $ 54,112 | $ 32,158 | |
Current income tax receivable | 37,674 | 0 | |
Noncurrent income taxes receivable | 52,300 | ||
Valuation allowance | 109,250 | 118,089 | |
Undistributed earnings of certain foreign subsidiaries | 260,600 | ||
Undistributed earnings, amount subject to reinvestment | 417,000 | ||
Unrecognized tax benefits that would favorably impact the effective tax rate in future periods if recognized | 31,500 | 35,700 | $ 33,500 |
Unrecognized tax benefits excluding interest and penalties | 15,400 | ||
Accrued income tax-related interest | 6,700 | 4,800 | |
Penalties accrued | 800 | 1,000 | |
Accrued interest (benefit) expense | 1,900 | $ 1,200 | $ 800 |
Foreign income tax | |||
Income tax contingency | |||
Deferred tax assets, loss carryforwards | 45,300 | ||
Increase (decrease) in deferred tax asset valuation allowance | 20,200 | ||
State income tax | |||
Income tax contingency | |||
Deferred tax assets, loss carryforwards | 8,800 | ||
U.S. income tax | |||
Income tax contingency | |||
Reduction of valuation allowance due to operating loss carryback | 24,400 | ||
Increase (decrease) in deferred tax asset valuation allowance | 4,500 | ||
United States | |||
Income tax contingency | |||
Valuation allowance | 56,000 | ||
Foreign Plan | |||
Income tax contingency | |||
Valuation allowance | $ 53,300 |
Taxes - Operating Loss Carryfor
Taxes - Operating Loss Carryforwards (Details) $ in Thousands | Jan. 02, 2021USD ($) |
Foreign income tax | |
Operating loss carryforwards | |
Total loss carryforwards | $ 184,460 |
Foreign income tax | Expires 2021 through 2025 | |
Operating loss carryforwards | |
Total loss carryforwards | 29,990 |
Foreign income tax | Expires 2026 through 2030 | |
Operating loss carryforwards | |
Total loss carryforwards | 58,328 |
Foreign income tax | Expires 2031 through 2035 | |
Operating loss carryforwards | |
Total loss carryforwards | 0 |
Foreign income tax | Expires 2036 through 2040 | |
Operating loss carryforwards | |
Total loss carryforwards | 74,314 |
Foreign income tax | Indefinite | |
Operating loss carryforwards | |
Total loss carryforwards | 21,828 |
State income tax | |
Operating loss carryforwards | |
Total loss carryforwards | 162,458 |
State income tax | Expires 2021 through 2025 | |
Operating loss carryforwards | |
Total loss carryforwards | 2,567 |
State income tax | Expires 2026 through 2030 | |
Operating loss carryforwards | |
Total loss carryforwards | 13,677 |
State income tax | Expires 2031 through 2035 | |
Operating loss carryforwards | |
Total loss carryforwards | 16,545 |
State income tax | Expires 2036 through 2040 | |
Operating loss carryforwards | |
Total loss carryforwards | 80,377 |
State income tax | Indefinite | |
Operating loss carryforwards | |
Total loss carryforwards | $ 49,292 |
Taxes - Income Before Income Ta
Taxes - Income Before Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | |
Income Tax Disclosure [Abstract] | |||
U.S | $ (163,331) | $ (142,141) | $ (102,810) |
Non-U.S | (8,652) | 110,810 | 122,980 |
Income (loss) before income taxes | $ (171,983) | $ (31,331) | $ 20,170 |
Taxes - Provision for Income Ta
Taxes - Provision for Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | |
Current provision: | |||
U.S. federal | $ (96,224) | $ 2,338 | $ (14,386) |
Non-U.S | 16,522 | 28,109 | 35,854 |
State and local | (681) | (2,330) | (2,056) |
Total current | (80,383) | 28,117 | 19,412 |
Deferred provision (benefit): | |||
U.S. federal | 0 | 0 | 0 |
Non-U.S | 4,340 | (9,436) | 1,696 |
State and local | 0 | 0 | 0 |
Total deferred | 4,340 | (9,436) | 1,696 |
Provision for income taxes | $ (76,043) | $ 18,681 | $ 21,108 |
Taxes - Reconciliation of U.S.
Taxes - Reconciliation of U.S. Federal Statutory Income Tax Rate (Details) | 12 Months Ended | ||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | |
Income Tax Disclosure [Abstract] | |||
Tax at statutory rate | 21.00% | 21.00% | 21.00% |
Permanent differences | (4.50%) | (2.00%) | (0.20%) |
State, net of federal tax benefit | (0.10%) | 17.60% | (3.80%) |
Foreign rate differential | 1.20% | 12.80% | (12.30%) |
Withholding taxes | (1.20%) | (11.10%) | 16.30% |
GILTI tax-net of foreign tax credits | 2.10% | (24.20%) | 11.80% |
U.S. tax on foreign income-net of foreign tax credits | 3.90% | 0.30% | 6.40% |
Income tax contingencies | 1.60% | 3.20% | (5.00%) |
Valuation allowances | (0.40%) | (53.20%) | 65.00% |
Repatriation tax - net impact | 0 | 0 | 0.059 |
Deficiencies on employee stock awards | (1.40%) | (10.90%) | 10.10% |
Tax reform rate reduction impact on deferred tax assets | 0.00% | 0.00% | (15.80%) |
Foreign deferred tax rate change | 0.00% | (4.50%) | 0.00% |
Non deductible foreign equity awards | (0.40%) | (3.20%) | 5.30% |
Non deductible officer compensation | 0.70% | (3.70%) | 0.00% |
Tax exempt foreign capital gain income | 0.00% | 6.30% | 0.00% |
Deferred adjustment | 0.00% | (8.00%) | 0.00% |
CARES Act Rate Benefit | 21.70% | 0.00% | 0.00% |
Provision for income taxes | 44.20% | (59.60%) | 104.70% |
Taxes - Reconciliation of Unrec
Taxes - Reconciliation of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Balance at beginning of year | $ 35,676 | $ 39,909 | $ 35,355 |
Gross increases—tax positions in prior years | 1,241 | 6,639 | 7,183 |
Gross decreases—tax positions in prior years | (4,281) | (4) | (124) |
Gross increases—tax positions in current year | 857 | 184 | 576 |
Settlements | 0 | (1,901) | 0 |
Lapse in statute of limitations | (2,255) | (8,912) | (2,980) |
Change due to currency revaluation | 302 | (239) | (101) |
Balance at end of year | $ 31,540 | $ 35,676 | $ 39,909 |
Leases (Details)
Leases (Details) $ in Millions | 12 Months Ended |
Jan. 02, 2021USD ($) | |
COVID-19 | |
Lessee, Lease, Description [Line Items] | |
Deferred rent, lease concessions | $ 5.2 |
Lessee, operating lease, rent forgiveness | $ 9.7 |
Minimum | |
Lessee, Lease, Description [Line Items] | |
Operating lease, renewal term | 1 year |
Maximum | |
Lessee, Lease, Description [Line Items] | |
Operating lease, renewal term | 10 years |
Leases - Components of Lease Ex
Leases - Components of Lease Expenses (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 02, 2021 | Dec. 28, 2019 | |
Leases [Abstract] | ||
Operating lease cost | $ 106,004 | $ 117,932 |
Amortization of ROU assets | 506 | 475 |
Interest on lease liabilities | 33 | 38 |
Short-term lease cost | 610 | 1,302 |
Variable lease cost | $ 22,048 | $ 36,476 |
Leases - Supplemental Balance S
Leases - Supplemental Balance Sheet Information (Details) - USD ($) $ in Thousands | Jan. 02, 2021 | Dec. 28, 2019 |
Assets [Abstract] | ||
Operating lease right-of-use assets | $ 226,815 | $ 288,166 |
4015000 | $ 5,991 | 5,918 |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | us-gaap:PropertyPlantAndEquipmentNet | |
Current: | ||
Current operating lease liabilities | $ 64,851 | 68,838 |
Short-term and current portion of long-term debt | $ 1,088 | 1,011 |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible List] | us-gaap:DebtCurrent | |
Noncurrent: | ||
Long-term operating lease liabilities | $ 230,635 | 288,689 |
Long-term debt | $ 569 | 1,468 |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | us-gaap:LongTermDebtAndCapitalLeaseObligations | |
Finance lease, accumulated amortization | $ 4,882 | $ 4,015 |
Leases - Weighted-Average Remai
Leases - Weighted-Average Remaining Lease Term and Discount Rate (Details) | Jan. 02, 2021 | Dec. 28, 2019 |
Weighted-average remaining lease term: | ||
Operating leases (in years) | 5 years 10 months 24 days | 6 years 1 month 6 days |
Finance leases (in years) | 1 year 2 months 12 days | 2 years 3 months 18 days |
Weighted-average discount rate: | ||
Operating leases | 14.00% | 13.90% |
Finance leases | 1.20% | 1.20% |
Leases - Maturity of Lease Liab
Leases - Maturity of Lease Liabilities (Details) - USD ($) $ in Thousands | Jan. 02, 2021 | Dec. 28, 2019 |
Operating Leases | ||
2021 | $ 101,507 | $ 116,778 |
2022 | 85,753 | 94,795 |
2023 | 66,909 | 81,536 |
2024 | 46,656 | 64,582 |
2025 | 33,012 | 45,846 |
Thereafter | 122,318 | 153,255 |
Total lease payments | 456,155 | 556,792 |
Less: Interest | 160,669 | 199,265 |
Total lease obligations | 295,486 | 357,527 |
Finance Leases | ||
2021 | 1,095 | 1,042 |
2022 | 569 | 978 |
2023 | 0 | 488 |
2024 | 0 | 0 |
2025 | 0 | 0 |
Thereafter | 0 | 0 |
Total lease payments | 1,664 | 2,508 |
Less: Interest | 6 | 30 |
Total lease obligations | $ 1,658 | $ 2,478 |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 02, 2021 | Dec. 28, 2019 | |
Cash paid for amounts included in the measurement of lease liabilities: | ||
Operating cash flows from operating leases | $ 131,499 | $ 116,846 |
Operating cash flows from finance leases | 33 | 38 |
Financing cash flows from finance leases | 1,051 | 945 |
Leased assets obtained in exchange for new finance lease liabilities | 49 | 83 |
Leased assets obtained in exchange for new operating lease liabilities | $ 26,474 | $ 41,510 |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | |
Other Commitments [Line Items] | |||
Royalty expense | $ 137.2 | $ 161.8 | $ 173 |
Purchase obligations | $ 363.1 | ||
Minimum | |||
Other Commitments [Line Items] | |||
Percentage of royalties | 7.00% | ||
Maximum | |||
Other Commitments [Line Items] | |||
Percentage of royalties | 15.00% |
Commitments and Contingencies_2
Commitments and Contingencies - Future Minimum Royalty Commitments Under License Agreements (Details) $ in Thousands | Jan. 02, 2021USD ($) |
Minimum Royalty Commitments | |
2021 | $ 112,639 |
2022 | 20,304 |
2023 | 20,880 |
2024 | 19,035 |
2025 | 17,040 |
Thereafter | 7,710 |
Total | $ 197,608 |
Commitments and Contingencies_3
Commitments and Contingencies - Changes in Asset Retirement Obligations (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 02, 2021 | Dec. 28, 2019 | |
Asset Retirement Obligation, Roll Forward Analysis [Roll Forward] | ||
Beginning asset retirement obligation | $ 12,093 | $ 11,862 |
Additions and changes in estimate | 1,542 | 563 |
Liabilities settled during the period | (933) | (681) |
Accretion expense | 325 | 366 |
Currency translation | 818 | (17) |
Ending asset retirement obligations | $ 13,845 | $ 12,093 |
Stockholders' Equity - Common a
Stockholders' Equity - Common and Preferred Stock (Details) - $ / shares | Jan. 02, 2021 | Dec. 28, 2019 |
Stockholders' Equity Note [Abstract] | ||
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares outstanding (in shares) | 51,474,034 | 50,516,477 |
Preferred stock, shares authorized (in shares) | 1,000,000 | 1,000,000 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, shares outstanding (in shares) | 51,474,034 | 50,516,477 |
Stockholders' Equity - Common S
Stockholders' Equity - Common Stock Repurchase Programs (Details) - USD ($) shares in Millions, $ in Millions | 85 Months Ended | |
Dec. 28, 2019 | Jan. 02, 2021 | |
Stockholders' Equity Note [Abstract] | ||
Common stock repurchased | $ 1,200 | |
Number of shares repurchased (in shares) | 11.8 | |
Authorizations remaining | $ 30 |
Employee Benefit Plans - Deferr
Employee Benefit Plans - Deferred Compensation and Savings Plans (Details) - USD ($) | 12 Months Ended | ||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | |
Share-based Payment Arrangement [Abstract] | |||
Employer's matching contributions under the plan | $ 1,000,000 | $ 3,200,000 | $ 2,800,000 |
Maximum additional contribution by employer (as a percent) | 15.00% | ||
Additional employer matching contributions | $ 0 | 0 | 0 |
Maximum percentage of salary that may be deferred by participating employees | 50.00% | ||
Maximum percentage of annual bonus that may be deferred by participating employees | 100.00% | ||
Deferred compensation plan, contributions by employer | $ 0 | 0 | $ 0 |
Asset related to invested balances recorded in intangibles and other assets-net | 6,300,000 | 5,200,000 | |
Liability related to participants' invested balances recorded in accrued expenses other | $ 4,400,000 | $ 4,600,000 |
Employee Benefit Plans - Stock-
Employee Benefit Plans - Stock-Based Compensation Plans (Details) $ in Millions | 12 Months Ended |
Jan. 02, 2021USD ($) | |
Share-based Payment Arrangement [Abstract] | |
Unrecognized compensation cost related to nonvested share-based compensation arrangements | $ 7.3 |
Weighted-average period over which unrecognized compensation cost is expected to be recognized (in years) | 1 year 4 months 24 days |
Employee Benefit Plans - Long-T
Employee Benefit Plans - Long-Term Incentive Plans (Details) - USD ($) | May 20, 2020 | May 23, 2018 | Jan. 02, 2021 | Mar. 31, 2016 |
Long-Term Incentive Plans | ||||
Price used to calculate value of the annual grant (in dollars per share) | $ 15 | |||
Price midpoint at date of annual grant | $ 2.86 | |||
Nonemployee director | Restricted stock units | ||||
Long-Term Incentive Plans | ||||
Value of awards granted | $ 130,000 | |||
Vesting percentage of awards granted | 100.00% | |||
Reduction of annual grant | 25.00% | |||
Restricted stock units fair market value | $ 18,600 | |||
2016 long term incentive plan | ||||
Long-Term Incentive Plans | ||||
Number of common shares reserved for issuance (in shares) | 10,288,468 | 3,000,000 | ||
Number of additional shares of common stock (in shares) | 5,000,000 | |||
Term of award under the plan | 10 years | |||
Vesting period | 3 years | |||
2008 long term incentive plan | ||||
Long-Term Incentive Plans | ||||
Number of additional shares of common stock (in shares) | 2,288,468 |
Employee Benefit Plans - Stock
Employee Benefit Plans - Stock Option and Stock Appreciation Rights Activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | |||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | Dec. 30, 2017 | |
Shares | ||||
Outstanding at beginning of period (in shares) | 509 | 1,930 | 2,177 | |
Granted (in shares) | 0 | 0 | 0 | |
Exercised (in shares) | 0 | (13) | (21) | |
Forfeited or expired (in shares) | (126) | (1,408) | (226) | |
Outstanding at end of period (in shares) | 383 | 509 | 1,930 | 2,177 |
Exercisable (in shares) | 383 | |||
Weighted-Average Exercise Price | ||||
Outstanding at beginning of period (in dollars per share) | $ 76.13 | $ 49.25 | $ 50.01 | |
Granted (in dollars per share) | 0 | 0 | 0 | |
Exercised (in dollars per share) | 0 | 13.65 | 14.46 | |
Forfeited or expired (in dollars per share) | 79.44 | 39.84 | 59.58 | |
Outstanding at end of period (in dollars per share) | 75.05 | $ 76.13 | $ 49.25 | $ 50.01 |
Exercisable (in dollars per share) | $ 75.05 | |||
Weighted-Average Remaining Contractual Term (Years) | ||||
Outstanding | 1 year 10 months 24 days | 2 years 6 months | 1 year 3 months 18 days | 5 years 3 months 18 days |
Exercisable | 1 year 10 months 24 days | |||
Aggregate Intrinsic Value | ||||
Outstanding | $ 0 | $ 0 | $ 37 | $ 0 |
Exercised | 0 | $ 18 | $ 37 | |
Exercisable | $ 0 |
Employee Benefit Plans - Stoc_2
Employee Benefit Plans - Stock Option and Stock Appreciation Rights Outstanding and Exercisable (Details) shares in Thousands | 12 Months Ended |
Jan. 02, 2021$ / sharesshares | |
Stock options | |
Stock-based compensation plans disclosures | |
Stock options outstanding, number of shares (in shares) | shares | 106 |
Stock options outstanding, weighted-average exercise price (in dollars per share) | $ 108.76 |
Stock options outstanding, weighted-average remaining contractual term | 9 months 18 days |
Stock options exercisable (in shares) | shares | 106 |
Stock options exercisable, weighted-average exercise price (in dollars per share) | $ 108.76 |
Stock options | $55.04 - $82.55 | |
Stock-based compensation plans disclosures | |
Stock options outstanding, number of shares (in shares) | shares | 44 |
Stock options outstanding, weighted-average exercise price (in dollars per share) | $ 81.23 |
Stock options outstanding, weighted-average remaining contractual term | 2 months 12 days |
Stock options exercisable (in shares) | shares | 44 |
Stock options exercisable, weighted-average exercise price (in dollars per share) | $ 81.23 |
Low range of exercise price range (in dollars per share) | 55.04 |
High range of exercise price range (in dollars per share) | $ 82.55 |
Stock options | $95.91 - $131.46 | |
Stock-based compensation plans disclosures | |
Stock options outstanding, number of shares (in shares) | shares | 62 |
Stock options outstanding, weighted-average exercise price (in dollars per share) | $ 128.11 |
Stock options outstanding, weighted-average remaining contractual term | 1 year 1 month 6 days |
Stock options exercisable (in shares) | shares | 62 |
Stock options exercisable, weighted-average exercise price (in dollars per share) | $ 128.11 |
Low range of exercise price range (in dollars per share) | 95.91 |
High range of exercise price range (in dollars per share) | $ 131.46 |
Stock appreciation rights | |
Stock-based compensation plans disclosures | |
Stock appreciation rights outstanding, number of shares | shares | 277 |
Stock appreciation rights outstanding, weighted- average exercise price (in dollars per share) | $ 62.17 |
Stock appreciation rights outstanding, weighted- average remaining contractual term | 2 years 3 months 18 days |
Stock appreciation rights exercisable (in shares) | shares | 277 |
Stock appreciation rights exercisable, weighted- average exercise price (in dollars per share) | $ 62.17 |
Stock appreciation rights | $55.04 - $82.55 | |
Stock-based compensation plans disclosures | |
Stock appreciation rights outstanding, number of shares | shares | 59 |
Stock appreciation rights outstanding, weighted- average exercise price (in dollars per share) | $ 77.98 |
Stock appreciation rights outstanding, weighted- average remaining contractual term | 1 year 10 months 24 days |
Stock appreciation rights exercisable (in shares) | shares | 59 |
Stock appreciation rights exercisable, weighted- average exercise price (in dollars per share) | $ 77.98 |
Share based compensation shares authorized under equity plans other than options exercise price range lower range limit (in dollars per share) | 55.04 |
Share based compensation shares authorized under equity plans other than options exercise price range upper range limit (in dollars per share) | $ 82.55 |
Stock appreciation rights | $95.91 - $131.46 | |
Stock-based compensation plans disclosures | |
Stock appreciation rights outstanding, number of shares | shares | 52 |
Stock appreciation rights outstanding, weighted- average exercise price (in dollars per share) | $ 109.71 |
Stock appreciation rights outstanding, weighted- average remaining contractual term | 9 months 18 days |
Stock appreciation rights exercisable (in shares) | shares | 52 |
Stock appreciation rights exercisable, weighted- average exercise price (in dollars per share) | $ 109.71 |
Share based compensation shares authorized under equity plans other than options exercise price range lower range limit (in dollars per share) | 95.91 |
Share based compensation shares authorized under equity plans other than options exercise price range upper range limit (in dollars per share) | $ 113.04 |
Stock appreciation rights | $29.49 - $47.99 | |
Stock-based compensation plans disclosures | |
Stock appreciation rights outstanding, number of shares | shares | 166 |
Stock appreciation rights outstanding, weighted- average exercise price (in dollars per share) | $ 41.77 |
Stock appreciation rights outstanding, weighted- average remaining contractual term | 2 years 10 months 24 days |
Stock appreciation rights exercisable (in shares) | shares | 166 |
Stock appreciation rights exercisable, weighted- average exercise price (in dollars per share) | $ 41.77 |
Share based compensation shares authorized under equity plans other than options exercise price range lower range limit (in dollars per share) | 29.49 |
Share based compensation shares authorized under equity plans other than options exercise price range upper range limit (in dollars per share) | $ 47.99 |
Employee Benefit Plans - Restri
Employee Benefit Plans - Restricted Stock and Restricted Stock Unit Activity (Details) - Restricted Stock and Restricted Stock Units - $ / shares shares in Thousands | 12 Months Ended | ||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | |
Number of Shares | |||
Nonvested at beginning of period (in shares) | 2,329 | 3,011 | 2,981 |
Granted (in shares) | 1,124 | 1,008 | 1,456 |
Vested (in shares) | (1,127) | (1,293) | (1,040) |
Forfeited (in shares) | (590) | (397) | (386) |
Nonvested at end of period (in shares) | 1,736 | 2,329 | 3,011 |
Weighted-Average Grant Date Fair Value Per Share | |||
Nonvested at beginning of period (in dollars per share) | $ 15.16 | $ 17.86 | $ 20.84 |
Granted (in dollars per share) | 3.76 | 13.01 | 14.35 |
Vested (in dollars per share) | 16.42 | 17.92 | 25.21 |
Forfeited (in dollars per share) | 12.42 | 21.49 | 19.87 |
Nonvested at end of period (in dollars per share) | $ 7.90 | $ 15.16 | $ 17.86 |
Employee Benefit Plans - Other
Employee Benefit Plans - Other Retirement Plans (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | |
Switzerland | |||
Employee Benefit Plans | |||
Pension gain (expense) | $ (1.3) | $ 0.7 | $ (0.6) |
Employee benefit plan obligations included in other long-term liabilities | 14.5 | 17 | |
France | |||
Employee Benefit Plans | |||
Pension gain (expense) | 0.2 | (0.4) | 0.4 |
Employee benefit plan obligations included in other long-term liabilities | 1.2 | ||
Restricted Stock and Restricted Stock Units | |||
Employee Benefit Plans | |||
Fair value of restricted stock and restricted stock units, vested | $ 4.8 | $ 17.6 | $ 16.6 |
Supplemental Cash Flow Inform_3
Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | |
Cash paid during the year for: | |||
Interest | $ 21,194 | $ 25,310 | $ 38,855 |
Income taxes, net of refunds | 10,027 | 18,025 | 28,460 |
Supplemental disclosures of non-cash investing and financing activities: | |||
Additions to property, plant and equipment included in accounts payable | 1,034 | 2,060 | 3,868 |
Additions to property, plant and equipment acquired under finance leases | $ 49 | $ 83 | $ 0 |
Supplemental Disclosure for A_3
Supplemental Disclosure for Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |||
Balance at beginning of period | $ 503,841 | $ 588,631 | $ 580,947 |
Other comprehensive income (loss) before reclassifications | 26,631 | (4,261) | 11,432 |
Tax (expense) benefit | (566) | (4) | (490) |
Amounts reclassed from accumulated other comprehensive income (loss) | 4,781 | 12,688 | (4,283) |
Tax (expense) benefit | (431) | (1,029) | 1,654 |
Adoption of ASU 2018-02 | (1,993) | ||
Total other comprehensive income (loss) | 21,715 | (15,924) | 13,571 |
Balance at end of period | 440,032 | 503,841 | 588,631 |
Currency Translation Adjustments | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |||
Balance at beginning of period | (80,474) | (74,868) | (64,499) |
Other comprehensive income (loss) before reclassifications | 19,296 | (5,606) | (10,369) |
Tax (expense) benefit | 0 | 0 | 0 |
Amounts reclassed from accumulated other comprehensive income (loss) | 0 | 0 | 0 |
Tax (expense) benefit | 0 | 0 | 0 |
Adoption of ASU 2018-02 | 0 | ||
Total other comprehensive income (loss) | 19,296 | (5,606) | (10,369) |
Balance at end of period | (61,178) | (80,474) | (74,868) |
Cash Flow Hedges | Forward contracts | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |||
Balance at beginning of period | 2,983 | 8,582 | (10,098) |
Other comprehensive income (loss) before reclassifications | 2,278 | 6,510 | 18,044 |
Tax (expense) benefit | (61) | (450) | 0 |
Amounts reclassed from accumulated other comprehensive income (loss) | 4,781 | 12,688 | (4,283) |
Tax (expense) benefit | (431) | (1,029) | 1,654 |
Adoption of ASU 2018-02 | (1,993) | ||
Total other comprehensive income (loss) | (2,133) | (5,599) | 20,673 |
Balance at end of period | 850 | 2,983 | 8,582 |
Pension Plan | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |||
Balance at beginning of period | (3,124) | 1,595 | (1,672) |
Other comprehensive income (loss) before reclassifications | 5,057 | (5,165) | 3,757 |
Tax (expense) benefit | (505) | 446 | (490) |
Amounts reclassed from accumulated other comprehensive income (loss) | 0 | 0 | 0 |
Tax (expense) benefit | 0 | 0 | 0 |
Adoption of ASU 2018-02 | 0 | ||
Total other comprehensive income (loss) | 4,552 | (4,719) | 3,267 |
Balance at end of period | 1,428 | (3,124) | 1,595 |
AOCI Attributable to Parent | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | |||
Balance at beginning of period | (80,615) | (64,691) | (76,269) |
Total other comprehensive income (loss) | 21,715 | (15,924) | 13,571 |
Balance at end of period | $ (58,900) | $ (80,615) | $ (64,691) |
Major Customer, Segment and G_3
Major Customer, Segment and Geographic Information - Information by Operating Segment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | |
Summary information by operating segment | |||
Net sales | $ 1,613,343 | $ 2,217,712 | $ 2,541,488 |
Operating income (loss) | (135,319) | (28,383) | 62,711 |
Depreciation and amortization | 42,250 | 53,442 | 67,079 |
Long-term assets | 488,030 | 545,274 | 316,629 |
Total assets | 1,478,505 | 1,604,732 | 1,575,198 |
Operating segments | Americas | |||
Summary information by operating segment | |||
Net sales | 642,213 | 949,965 | 1,174,507 |
Operating income (loss) | 32,998 | 66,703 | 185,094 |
Depreciation and amortization | 10,692 | 15,104 | 16,542 |
Long-term assets | 112,934 | 164,097 | 61,914 |
Total assets | 319,586 | 474,428 | 393,273 |
Operating segments | Europe | |||
Summary information by operating segment | |||
Net sales | 522,364 | 715,494 | 856,291 |
Operating income (loss) | 19,482 | 88,323 | 129,610 |
Depreciation and amortization | 12,222 | 15,099 | 18,933 |
Long-term assets | 135,190 | 171,952 | 99,253 |
Total assets | 328,246 | 406,603 | 353,797 |
Operating segments | Asia | |||
Summary information by operating segment | |||
Net sales | 434,351 | 535,156 | 505,473 |
Operating income (loss) | 62,589 | 101,209 | 87,515 |
Depreciation and amortization | 6,174 | 6,724 | 8,016 |
Long-term assets | 82,122 | 89,434 | 29,990 |
Total assets | 234,770 | 298,034 | 173,666 |
Corporate | |||
Summary information by operating segment | |||
Net sales | 14,415 | 17,097 | 5,217 |
Operating income (loss) | (250,388) | (284,618) | (339,508) |
Depreciation and amortization | 13,162 | 16,515 | 23,588 |
Long-term assets | 157,784 | 119,791 | 125,472 |
Total assets | $ 595,903 | $ 425,667 | $ 654,462 |
Major Customer, Segment and G_4
Major Customer, Segment and Geographic Information - Revenue for Each Class of Similar Products (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | |
Net sales for each class of similar products | |||
Percentage of total | 100.00% | 100.00% | 100.00% |
Net sales | $ 1,613,343 | $ 2,217,712 | $ 2,541,488 |
Watches | |||
Net sales for each class of similar products | |||
Percentage of total | 80.60% | 81.30% | 80.00% |
Net sales | $ 1,299,846 | $ 1,802,481 | $ 2,033,021 |
Leathers | |||
Net sales for each class of similar products | |||
Percentage of total | 10.70% | 10.80% | 11.40% |
Net sales | $ 173,621 | $ 238,619 | $ 289,385 |
Jewelry | |||
Net sales for each class of similar products | |||
Percentage of total | 6.40% | 5.60% | 6.60% |
Net sales | $ 102,917 | $ 123,177 | $ 167,775 |
Other | |||
Net sales for each class of similar products | |||
Percentage of total | 2.30% | 2.30% | 2.00% |
Net sales | $ 36,959 | $ 53,435 | $ 51,307 |
Major Customer, Segment and G_5
Major Customer, Segment and Geographic Information - Net Sales and Long-lived Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | |
Summary information by operating segment | |||
Net sales | $ 1,613,343 | $ 2,217,712 | $ 2,541,488 |
Long-term assets | 488,030 | 545,274 | 316,629 |
United States | |||
Summary information by operating segment | |||
Net sales | 546,753 | 819,825 | 1,017,919 |
Long-term assets | 234,325 | 239,032 | 159,062 |
Europe | |||
Summary information by operating segment | |||
Net sales | 525,333 | 718,216 | 857,972 |
Long-term assets | 147,208 | 184,507 | 111,964 |
Asia | |||
Summary information by operating segment | |||
Net sales | 436,570 | 537,503 | 507,523 |
Long-term assets | 89,144 | 99,565 | 36,945 |
All other international | |||
Summary information by operating segment | |||
Net sales | 104,687 | 142,168 | 158,074 |
Long-term assets | 17,353 | 22,170 | 8,658 |
Germany | |||
Summary information by operating segment | |||
Net sales | 225,500 | 310,100 | 359,900 |
China | |||
Summary information by operating segment | |||
Net sales | $ 228,400 | $ 218,100 | $ 190,000 |
Restructuring - Narrative (Deta
Restructuring - Narrative (Details) - New World Fossil 2.0 $ in Millions | Jan. 02, 2021USD ($) |
Minimum | |
Restructuring Cost and Reserve [Line Items] | |
Estimated total restructuring charges | $ 75 |
Maximum | |
Restructuring Cost and Reserve [Line Items] | |
Estimated total restructuring charges | $ 85 |
Restructuring - Liability Incur
Restructuring - Liability Incurred for Restructuring Plan (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | |
Restructuring Reserve [Roll Forward] | |||
Charges | $ 36,508 | $ 29,636 | $ 46,630 |
New World Fossil 2.0 | |||
Restructuring Reserve [Roll Forward] | |||
Balance at beginning of period | 7,084 | 0 | |
Charges | 36,508 | 18,831 | |
Cash payments | 30,799 | 11,172 | |
Non-cash items | 2,532 | 575 | |
Balance at end of period | 10,261 | 7,084 | 0 |
New World Fossil 2.0 | Store closures | |||
Restructuring Reserve [Roll Forward] | |||
Balance at beginning of period | 22 | 0 | |
Charges | 4,347 | 597 | |
Cash payments | 1,597 | 0 | |
Non-cash items | 2,532 | 575 | |
Balance at end of period | 240 | 22 | 0 |
New World Fossil 2.0 | Professional services | |||
Restructuring Reserve [Roll Forward] | |||
Balance at beginning of period | 2,824 | 0 | |
Charges | 7,503 | 8,039 | |
Cash payments | 8,047 | 5,215 | |
Non-cash items | 0 | 0 | |
Balance at end of period | 2,280 | 2,824 | 0 |
New World Fossil 2.0 | Severance and employee-related benefits | |||
Restructuring Reserve [Roll Forward] | |||
Balance at beginning of period | 4,238 | 0 | |
Charges | 24,658 | 10,195 | |
Cash payments | 21,155 | 5,957 | |
Non-cash items | 0 | 0 | |
Balance at end of period | 7,741 | 4,238 | 0 |
New World Fossil 1.0 | |||
Restructuring Reserve [Roll Forward] | |||
Balance at beginning of period | 3,710 | 8,027 | |
Charges | 10,805 | 46,630 | |
Cash payments | 10,501 | ||
Non-cash items | 4,621 | ||
Balance at end of period | 3,710 | 8,027 | |
New World Fossil 1.0 | Store closures | |||
Restructuring Reserve [Roll Forward] | |||
Balance at beginning of period | 1,863 | 2,818 | |
Charges | 2,971 | ||
Cash payments | 1,673 | ||
Non-cash items | 2,253 | ||
Balance at end of period | 1,863 | 2,818 | |
New World Fossil 1.0 | Professional services | |||
Restructuring Reserve [Roll Forward] | |||
Balance at beginning of period | 1,315 | 2,198 | |
Charges | 485 | ||
Cash payments | 1,368 | ||
Non-cash items | 0 | ||
Balance at end of period | 1,315 | 2,198 | |
New World Fossil 1.0 | Severance and employee-related benefits | |||
Restructuring Reserve [Roll Forward] | |||
Balance at beginning of period | $ 532 | 3,011 | |
Charges | 7,349 | ||
Cash payments | 7,460 | ||
Non-cash items | 2,368 | ||
Balance at end of period | $ 532 | $ 3,011 |
Restructuring - Restructuring C
Restructuring - Restructuring Charges by Operating Segment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | |
Restructuring Cost and Reserve [Line Items] | |||
Charges | $ 36,508 | $ 29,636 | $ 46,630 |
New World Fossil 2.0 | |||
Restructuring Cost and Reserve [Line Items] | |||
Charges | 36,508 | 18,831 | |
New World Fossil 1.0 | |||
Restructuring Cost and Reserve [Line Items] | |||
Charges | 10,805 | 46,630 | |
Operating segments | New World Fossil 2.0 | Americas | |||
Restructuring Cost and Reserve [Line Items] | |||
Charges | 4,969 | 2,048 | |
Operating segments | New World Fossil 2.0 | Europe | |||
Restructuring Cost and Reserve [Line Items] | |||
Charges | 12,630 | 9,333 | |
Operating segments | New World Fossil 2.0 | Asia | |||
Restructuring Cost and Reserve [Line Items] | |||
Charges | 8,823 | 773 | |
Operating segments | New World Fossil 1.0 | Americas | |||
Restructuring Cost and Reserve [Line Items] | |||
Charges | 2,941 | 17,197 | |
Operating segments | New World Fossil 1.0 | Europe | |||
Restructuring Cost and Reserve [Line Items] | |||
Charges | 1,272 | 10,116 | |
Operating segments | New World Fossil 1.0 | Asia | |||
Restructuring Cost and Reserve [Line Items] | |||
Charges | 793 | 2,946 | |
Corporate | New World Fossil 2.0 | |||
Restructuring Cost and Reserve [Line Items] | |||
Charges | $ 10,086 | 6,677 | |
Corporate | New World Fossil 1.0 | |||
Restructuring Cost and Reserve [Line Items] | |||
Charges | $ 5,799 | $ 16,371 |
SCHEDULE II VALUATIONS AND QU_2
SCHEDULE II VALUATIONS AND QUALIFYING ACCOUNTS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 02, 2021 | Dec. 28, 2019 | Dec. 29, 2018 | |
Bad debts | |||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at Beginning of Period | $ 77,467 | $ 67,132 | $ 75,200 |
Charged to Operations | 76,698 | 139,350 | 108,485 |
Charged to Other Accounts | 0 | 0 | 0 |
Actual Returns or Writeoffs | 104,339 | 129,015 | 116,553 |
Balance at End of Period | 49,826 | 77,467 | 67,132 |
Markdowns | |||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at Beginning of Period | 13,234 | 14,001 | 12,928 |
Charged to Operations | 9,535 | 2,921 | 8,921 |
Charged to Other Accounts | 0 | 0 | 0 |
Actual Returns or Writeoffs | 1,995 | 3,688 | 7,848 |
Balance at End of Period | 20,774 | 13,234 | 14,001 |
Markdowns | |||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at Beginning of Period | 23,086 | 19,019 | 0 |
Charged to Operations | 39,931 | 49,915 | 37,904 |
Charged to Other Accounts | 0 | 0 | 28,416 |
Actual Returns or Writeoffs | 47,404 | 45,848 | 47,301 |
Balance at End of Period | 15,613 | 23,086 | 19,019 |
Deferred tax asset valuation allowance | |||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at Beginning of Period | 118,089 | 95,818 | 78,314 |
Charged to Operations | 18,491 | 15,672 | 13,102 |
Charged to Other Accounts | (4,216) | 6,599 | 4,402 |
Actual Returns or Writeoffs | 23,114 | 0 | 0 |
Balance at End of Period | $ 109,250 | $ 118,089 | $ 95,818 |