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RESTRUCTURING

6 Months Ended

Jun. 29, 2024

Restructuring and Related Activities [Abstract]

RESTRUCTURING

RESTRUCTURING

    In fiscal year 2023, the Company announced its Transform and Grow strategy ("TAG") designed to reduce operating costs, improve operating margins, and advance the Company’s commitment to profitable growth. The Company expanded the scope and duration of TAG to focus on a more comprehensive review of its global business operations. The expansion of TAG will put greater emphasis on initiatives to exit or minimize certain product offerings, brands and distribution, and to strengthen gross margin and increase the level of operating expense efficiencies. TAG is estimated to generate approximately $300 million of annualized operating benefits by the end of 2025. The Company estimates approximately $100 million to $120 million in total charges over the duration of TAG, with approximately $40 million in fiscal year 2024. Aided by these measures, the Company's long-term goal is to achieve adjusted gross margins in the low to mid 50% range and adjusted operating margins of approximately 10%.

The following table shows a summary of TAG plan charges (in thousands):

			For the 13 Weeks Ended June 29, 2024						For the 13 Weeks Ended July 1, 2023						For the 26 Weeks Ended June 29, 2024						For the 26 Weeks Ended July 1, 2023
Cost of sales			$	—					$	2,911					$	(241)					$	8,174
Selling, general and administrative expenses			16,673						4,632						26,726						11,729
Consolidated			$	16,673					$	7,543					$	26,485					$	19,903

The following table shows a rollforward of the accrued liability related to the Company’s TAG plan (in thousands):

			For the 13 Weeks Ended June 29, 2024
			Liabilities																								Liabilities
			March 30, 2024						Charges						Cash Payments						Non-cash Items						June 29, 2024
Stores and facilities closures			$	1					$	36					$	1					$	36					$	—
Professional services			211						11,568						460						—						11,319
Severance and employee-related benefits			8,479						5,069						4,834						365						8,349
Charges related to exits of certain product offerings			750						—						450						—						300
Total			$	9,441					$	16,673					$	5,745					$	401					$	19,968

			For the 13 Weeks Ended July 1, 2023
			Liabilities																								Liabilities
			April 1, 2023						Charges						Cash Payments												July 1, 2023
Professional services			$	20					$	967					$	89											$	898
Severance and employee-related benefits			4,500						3,666						3,353												4,813
Charges related to exits of certain product offerings			5,264						2,910						700												7,474
Total			9,784						7,543						4,142												13,185

			For the 26 Weeks Ended June 29, 2024
			Liabilities																								Liabilities
			December 30, 2023						Charges						Cash Payments						Non-cash Items						June 29, 2024
Stores and facilities closures			$	—					$	143					$	7					$	136					$	—
Professional services			117						14,052						2,850						—						11,319
Severance and employee-related benefits			8,117						12,531						11,934						365						8,349
Charges related to exits of certain product offerings			3,821						(241)						3,280						—						300
Total			$	12,055					$	26,485					$	18,071					$	501					$	19,968

			For the 26 Weeks Ended July 1, 2023
			Liabilities																								Liabilities
			December 31, 2022						Charges						Cash Payments												July 1, 2023
Professional services			$	—					$	1,002					$	104											$	898
Severance and employee-related benefits			—						10,727						5,914												4,813
Charges related to exits of certain product offerings			—						8,174						700												7,474
Total			$	—					$	19,903					$	6,718											$	13,185

TAG plan restructuring charges by operating segment were as follows (in thousands):

			For the 13 Weeks Ended June 29, 2024						For the 13 Weeks Ended July 1, 2023						For the 26 Weeks Ended June 29, 2024						For the 26 Weeks Ended July 1, 2023
Americas			$	262					$	1,535					$	626					$	4,493
Europe			1,869						3,386						5,426						7,342
Asia			93						1,686						1,056						5,953
Corporate			14,449						936						19,377						2,115
Consolidated			$	16,673					$	7,543					$	26,485					$	19,903

In fiscal year 2022, the Company completed its New World Fossil 2.0 ("NWF 2.0”) restructuring program it launched in 2019. The following table shows a rollforward of the accrued liability related to the Company’s NWF 2.0 restructuring plan (in thousands):

			For the 13 Weeks Ended July 1, 2023
			Liabilities																								Liabilities
			April 1, 2023												Cash Payments												July 1, 2023
Professional services			$	60											$	13											$	47
Severance and employee-related benefits			587												327												260
Total			$	647											$	340											$	307

			For the 26 Weeks Ended July 1, 2023
			Liabilities																								Liabilities
			December 31, 2022												Cash Payments												July 1, 2023
Professional services			$	74											$	27											$	47
Severance and employee-related benefits			2,821												2,561												260
Total			$	2,895											$	2,588											$	307

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- References

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- Definition

The entire disclosure for restructuring and related activities. Description of restructuring activities such as exit and disposal activities, include facts and circumstances leading to the plan, the expected plan completion date, the major types of costs associated with the plan activities, total expected costs, the accrual balance at the end of the period, and the periods over which the remaining accrual will be settled.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 420
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 2
-Subparagraph (SAB Topic 5.P.4.e)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479823/420-10-S99-2

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 420
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (b)(2)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482017/420-10-50-1

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 420
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482017/420-10-50-1

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 420
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org/420/tableOfContent

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 420
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (e)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482017/420-10-50-1

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