RESTRUCTURING

6 Months Ended

Jun. 29, 2019

Restructuring and Related Activities [Abstract]

The Company implemented a multi-year restructuring program that began in fiscal year 2016 called New World Fossil ("NWF 1.0"). As part of NWF 1.0, the Company targets to improve operating profit and support sales growth through a leaner infrastructure and an enhanced business model. The Company is working to achieve greater efficiencies from production to distribution through activities such as organizational changes, reducing its overall product assortment, optimizing its base cost structure and consolidating facilities. The Company also intends to build a quicker and more responsive operating platform. The Company is reducing its retail footprint to reflect the evolving shopping habits of today's consumer, which results in restructuring costs, such as store impairment, lease exit obligations and termination fees and accelerated depreciation. The Company expects to spend up to $20 million in the second half of fiscal year 2019 as it completes its NWF 1.0 program. NWF 1.0 restructuring charges of approximately $10.8 million, $46.6 million and $48.2 million were recorded during the Year To Date period, fiscal year 2018 and fiscal year 2017, respectively.

The following tables show a rollforward of the accrued liability related to the Company’s NWF 1.0 restructuring plan (in thousands):



	For the 13 Weeks Ended June 29, 2019
	Liabilities								Liabilities
	March 30, 2019		Charges		Cash Payments		Non-cash Items		June 29, 2019
Store closures	$	3,047	$	306	$	700	$	299	$	2,354
Professional services	1,864		—		467		—		1,397
Severance and employee-related benefits	3,912		1,152		2,625		85		2,354
Total	$	8,823	$	1,458	$	3,792	$	384	$	6,105



	For the 13 Weeks Ended June 30, 2018
	Liabilities								Liabilities
	March 31, 2018		Charges		Cash Payments		Non-cash Items		June 30, 2018
Store closures	$	4,405	$	6,434	$	5,190	$	234	$	5,415
Professional services	698		4,119		3,299		—		1,518
Severance and employee-related benefits	3,335		3,996		4,495		—		2,836
Total	$	8,438	$	14,549	$	12,984	$	234	$	9,769



	For the 26 Weeks Ended June 29, 2019
	Liabilities								Liabilities
	December 29, 2018		Charges		Cash Payments		Non-cash Items		June 29, 2019
Store closures	$	2,818	$	2,971	$	1,182	$	2,253	$	2,354
Professional services	2,198		485		1,286		—		1,397
Severance and employee-related benefits	3,011		7,349		5,638		2,368		2,354
Total	$	8,027	$	10,805	$	8,106	$	4,621	$	6,105



	For the 26 Weeks Ended June 30, 2018
	Liabilities								Liabilities
	December 30, 2017		Charges		Cash Payments		Non-cash Items		June 30, 2018
Store closures	$	2,973	$	14,989	$	10,602	$	1,945	$	5,415
Professional services	185		5,277		3,944		—		1,518
Severance and employee-related benefits	1,317		15,600		8,623		5,458		2,836
Total	$	4,475	$	35,866	$	23,169	$	7,403	$	9,769

NWF 1.0 restructuring charges by operating segment were as follows (in thousands):



	For the 13 Weeks Ended June 29, 2019		For the 13 Weeks Ended June 30, 2018		For the 26 Weeks Ended June 29, 2019		For the 26 Weeks Ended June 30, 2018
Americas	$	279	$	8,412	$	2,941	$	16,536
Europe	37		2,352		1,272		5,719
Asia	246		637		793		1,331
Corporate	896		3,148		5,799		12,280
Consolidated	$	1,458	$	14,549	$	10,805	$	35,866

Additionally, during the first quarter of fiscal 2019, the Company launched a new restructuring program, New World Fossil 2.0 (“NWF 2.0”), which is focused on optimizing the Company’s operating structure to be more efficient, with faster decision-making and a more customer-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 following tables show a rollforward of the accrued liability related to the Company’s NWF 2.0 restructuring plan (in thousands):



	For the 13 Weeks Ended June 29, 2019
	Liabilities						Liabilities
	March 30, 2019		Charges		Cash Payments		June 29, 2019
Professional services	426		1,798		1,494		730
Severance and employee-related benefits	—		4,061		289		3,772
Total	$	426	$	5,859	$	1,783	$	4,502



	For the 26 Weeks Ended June 29, 2019
	Liabilities						Liabilities
	December 29, 2018		Charges		Cash Payments		June 29, 2019
Professional services and other	—		2,638		1,908		730
Severance and employee-related benefits	—		4,061		289		3,772
Total	$	—	$	6,699	$	2,197	$	4,502

NWF 2.0 restructuring charges by operating segment were as follows (in thousands):



	For the 13 Weeks Ended June 29, 2019		For the 26 Weeks Ended June 29, 2019
Europe	4,554		5,394
Corporate	1,305		1,305
Consolidated	$	5,859	$	6,699