-- Strong Performance at Tommy Bahama
Continues----Lilly Pulitzer Acquires Licensed Signature Stores in
Key Northeast Markets---- Reports Second Quarter GAAP EPS of $1.36;
Adjusted EPS of $1.44 at Top of Guidance Range---- Reiterates
Full-Year Adjusted EPS Guidance--
Oxford Industries, Inc. (NYSE:OXM) today announced financial
results for its fiscal 2017 second quarter ended July 29, 2017.
Consolidated net sales increased to $284.7 million compared
to $283.0 million in the second quarter of fiscal 2016. Earnings on
a GAAP basis were $1.36 per share in the second quarter of fiscal
2017 compared to $1.44 in the same period of the prior year.
On an adjusted basis, earnings were $1.44 per share in the second
quarter of fiscal 2017 compared to $1.48 in the second quarter of
fiscal 2016.
Thomas C. Chubb III, Chairman and CEO, commented, “Our dynamic
portfolio of strong lifestyle brands continues to differentiate our
business and fuel our success in a highly competitive and rapidly
evolving consumer marketplace. We are pleased with our second
quarter results, particularly for Tommy Bahama, and in the health
of each our brands. The value our brands deliver to customers
as well as our continued focus on execution gives us confidence in
our ability to achieve our full-year financial, operational and
strategic objectives.”
Mr. Chubb continued, “Our retail stores continue to generate a
very healthy return on investment. Strong visual merchandising and
a clear brand message provide an important point of connection with
our consumers and support an opportunity for measured growth as we
go forward. Our confidence in this opportunity is reflected
in our acquisition of the “In the Pink” and “Pink Palm” licensed
Lilly Pulitzer signature stores. Lilly’s position as a resort
lifestyle brand is a competitive advantage and the addition of
stores in key resort locations such as Nantucket, Cape Cod and
Martha’s Vineyard allows us to further leverage that
advantage.”
Mr. Chubb concluded, “While key brick and mortar locations will
always be an important point of distribution for each of our
brands, our fastest growing channel of distribution is in our
e-commerce businesses. We are already a market leader and are
keenly focused on maintaining that position as the market evolves
into a digital first environment. Our Tommy Bahama, Lilly Pulitzer
and Southern Tide brands have distinct competitive advantages as
well as talented teams operating within a culture of excellence
that brings out their best efforts. This is, in any
environment, a formula for
success.”
Consolidated Operating Results
Consolidated net sales in the second quarter of fiscal 2017
increased 1% to $284.7 million. This modest increase included
year over year increases at Tommy Bahama and Southern Tide
partially offset by a decrease at Lanier Apparel. Lilly
Pulitzer’s sales were essentially flat with the prior year.
Gross profit in the second quarter increased to $166.0 million
compared to $164.8 million in the same period of the prior year.
Gross margin in the second quarter of fiscal 2017 was 58.3%
compared to 58.2% in the second quarter of fiscal 2016. On an
adjusted basis, gross margin expanded to 58.8% compared to 58.2% in
the prior year.
In the second quarter of fiscal 2017, SG&A was 46.7% as a
percentage of net sales or $132.9 million compared to 45.7% or
$129.4 million in the prior year’s second quarter. The
increase in SG&A was primarily due to incremental costs
associated with operating additional retail stores and increased
incentive compensation.
For the second quarter of fiscal 2017, royalties and other
operating income were flat with the prior year at $3.3
million.
Operating income in the second quarter of fiscal 2017 was $36.4
million compared to $38.7 million in the same period of the prior
year. On an adjusted basis, operating income was $38.4 million
compared to $39.7 million in the second quarter of fiscal
2016.
Interest expense for the second quarter of fiscal 2017 was $0.7
million compared to $1.2 million in the second quarter of fiscal
2016.
Balance Sheet and Liquidity
Inventory decreased 11% to $119.6 million at July 29, 2017 from
$133.7 million at the end of the second quarter of fiscal 2016
reflecting lower inventories at Lanier Apparel, Southern Tide and
Tommy Bahama.
As of July 29, 2017, the Company had $37.6 million of borrowings
outstanding under its $325 million revolving credit agreement
compared to $105.9 million at the end of the second quarter of
fiscal 2016, with the decrease attributable to strong cash flow
from operations. The Company ended the quarter with $215.3
million of unused availability under its credit agreement.
Outlook for Third Quarter and Fiscal Year
2017
The Company initiated its guidance for the third quarter of
fiscal 2017, ending on October 28, 2017. The Company expects
net sales in a range from $240 million to $250 million compared to
net sales of $222.3 million in the third quarter of fiscal 2016.
Earnings per share on a GAAP basis are expected to be in a range of
$0.04 to $0.14 in the third quarter. On an adjusted basis,
earnings per share for the third quarter of fiscal 2017 are
expected to be in a range of $0.09 to $0.19. This compares with a
third quarter fiscal 2016 loss per share of $0.10 and an adjusted
loss per share of $0.07.
The Company has affirmed its adjusted earnings outlook for the
full 2017 fiscal year and has revised its GAAP earnings outlook due
to the impact of LIFO and purchase accounting. GAAP earnings per
share are now expected to be between $3.23 and $3.43. Adjusted
earnings per share are expected to be between $3.50 and $3.70. This
compares to earnings on a GAAP basis of $3.27 per share and, on an
adjusted basis, $3.30 per share in fiscal 2016. The Company expects
net sales to grow to between $1.085 billion to $1.105 billion as
compared to Fiscal 2016 net sales of $1.023 billion.
The Company’s effective tax rate for fiscal 2017 is expected to
approach 39% compared to 37% in the full 2016 fiscal year, with the
increase reflecting the unfavorable impact of the vesting of stock
awards in the first quarter and a reduction in the utilization of
operating loss carryforwards relative to fiscal 2016. Full year
interest expense is estimated to be approximately $3.4 million.
Capital expenditures in fiscal 2017, including $18.5 million in
the first half of fiscal 2017, are expected to be approximately $50
million, primarily reflecting investments in information technology
initiatives, new retail stores and restaurants, and investments to
remodel and relocate existing retail stores.
Dividend
The Company also announced that its Board of Directors has
approved a cash dividend of $0.27 per share payable on October 27,
2017 to shareholders of record as of the close of business on
October 13, 2017. The Company has paid dividends every quarter
since it became publicly owned in 1960.
Conference Call
The Company will hold a conference call with senior management
to discuss its financial results at 4:30 p.m. ET today. A live web
cast of the conference call will be available on the Company’s
website at www.oxfordinc.com. A replay of the call will be
available through September 14, 2017 by dialing (412) 317-6671
access code 9101257.
About Oxford
Oxford Industries, Inc., a leader in the apparel industry, owns
and markets the distinctive Tommy Bahama®, Lilly Pulitzer® and
Southern Tide® lifestyle brands. Oxford also produces certain
licensed and private label apparel products. Oxford's stock has
traded on the New York Stock Exchange since 1964 under the symbol
OXM. For more information, please visit Oxford's website at
www.oxfordinc.com.
Basis of Presentation
All financial results and outlook information included in this
release, unless otherwise noted, are from continuing operations and
all per share amounts are on a diluted basis. The results from the
Ben Sherman business, which was sold on July 17, 2015, are
reflected as discontinued operations for all periods
presented. Fiscal 2017, which ends February 3, 2018, is a
53-week year.
Non-GAAP Financial Information
The Company reports its consolidated financial statements in
accordance with generally accepted accounting principles
(GAAP). To supplement these consolidated financial results,
management believes that a presentation and discussion of certain
financial measures on an adjusted basis, which exclude certain
non-operating or discrete gains, charges or other items, may
provide a more meaningful basis on which investors may compare the
Company’s ongoing results of operations between periods.
These measures include adjusted earnings, adjusted earnings
per share, adjusted gross profit, adjusted gross margin, adjusted
SG&A and adjusted operating income, among others. Management
uses these non-GAAP financial measures in making financial,
operational and planning decisions to evaluate the Company’s
ongoing performance. Management also uses these adjusted financial
measures to discuss its business with investment and other
financial institutions, its board of directors and others.
Reconciliations of these adjusted measures to the most directly
comparable financial measures calculated in accordance with GAAP
are presented in tables included at the end of this release.
These reconciliations present adjusted operating results
information for certain historical and future periods.
Safe Harbor
This press release includes statements that constitute
forward-looking statements within the meaning of the federal
securities laws. Generally, the words "believe," "expect,"
"intend," "estimate," "anticipate," "project," "will" and similar
expressions identify forward-looking statements, which are not
historical in nature. We intend for all forward-looking statements
contained herein or on our website, and all subsequent written and
oral forward-looking statements attributable to us or persons
acting on our behalf, to be covered by the safe harbor provisions
for forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995 and the provisions of
Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934 (which Sections were adopted as
part of the Private Securities Litigation Reform Act of 1995). Such
statements are subject to a number of risks, uncertainties and
assumptions including, without limitation, competitive conditions,
which may be impacted by evolving consumer shopping patterns; the
impact of economic conditions on consumer demand and spending for
apparel and related products, particularly in light of general
economic uncertainty; changes in international, federal or state,
tax, trade and other laws and regulations, including changes in
corporate tax rates, quota restrictions or the imposition of
safeguard controls; demand for our products; timing of shipments
requested by our wholesale customers; expected pricing levels;
retention of and disciplined execution by key management; the
timing and cost of store openings and of planned capital
expenditures; weather; costs of products as well as the raw
materials used in those products; costs of labor; acquisition and
disposition activities; expected outcomes of pending or potential
litigation and regulatory actions; access to capital and/or credit
markets; our ability to timely recognize our expected
synergies from any acquisitions we pursue; and factors that could
affect our consolidated effective tax rate such as the results of
foreign operations or stock based compensation. Forward-looking
statements reflect our expectations at the time such
forward-looking statements are made, based on information available
at such time, and are not guarantees of performance. Although we
believe that the expectations reflected in such forward-looking
statements are reasonable, these expectations could prove
inaccurate as such statements involve risks and uncertainties, many
of which are beyond our ability to control or predict. Should one
or more of these risks or uncertainties, or other risks or
uncertainties not currently known to us or that we currently deem
to be immaterial, materialize, or should underlying assumptions
prove incorrect, actual results may vary materially from those
anticipated, estimated or projected. Important factors relating to
these risks and uncertainties include, but are not limited to,
those described in Part I, Item 1A. contained in our Annual Report
on Form 10-K for the period ended January 28, 2017 under the
heading "Risk Factors" and those described from time to time in our
future reports filed with the SEC. You should not place undue
reliance on forward-looking statements, which speak only as of the
date on which they are made. We disclaim any intention,
obligation or duty to update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise, except as required by law.
Oxford Industries, Inc. |
Condensed Consolidated Balance Sheets |
(in thousands, except par amounts) |
(unaudited) |
|
|
July 29, 2017 |
July 30, 2016 |
ASSETS |
|
|
|
Current
Assets |
|
|
|
Cash and cash
equivalents |
|
$ |
5,983 |
|
$ |
8,192 |
|
Receivables, net |
|
|
59,264 |
|
|
61,081 |
|
Inventories, net |
|
|
119,620 |
|
|
133,662 |
|
Prepaid
expenses |
|
|
19,626 |
|
|
22,917 |
|
Total Current
Assets |
|
$ |
204,493 |
|
$ |
225,852 |
|
Property and equipment,
net |
|
|
193,668 |
|
|
190,195 |
|
Intangible assets,
net |
|
|
174,262 |
|
|
186,565 |
|
Goodwill |
|
|
60,059 |
|
|
50,911 |
|
Other
non-current assets, net |
|
|
24,265 |
|
|
23,041 |
|
Total Assets |
|
$ |
656,747 |
|
$ |
676,564 |
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY |
|
|
|
Current
Liabilities |
|
|
|
Accounts payable |
|
$ |
60,332 |
|
$ |
58,957 |
|
Accrued
compensation |
|
|
25,403 |
|
|
20,689 |
|
Other accrued expenses
and liabilities |
|
|
32,757 |
|
|
32,963 |
|
Liabilities related to discontinued operations |
|
|
3,425 |
|
|
— |
|
Total Current
Liabilities |
|
$ |
121,917 |
|
$ |
112,609 |
|
Long-term debt |
|
|
37,601 |
|
|
105,941 |
|
Other non-current
liabilities |
|
|
70,836 |
|
|
68,529 |
|
Deferred taxes |
|
|
15,520 |
|
|
12,620 |
|
Liabilities related to
discontinued operations |
|
|
1,507 |
|
|
3,469 |
|
Commitments and
contingencies |
|
|
|
Shareholders’
Equity |
|
|
|
Common stock,
$1.00 par value per share |
|
|
16,827 |
|
|
16,769 |
|
Additional paid-in
capital |
|
|
132,668 |
|
|
127,595 |
|
Retained earnings |
|
|
264,282 |
|
|
234,142 |
|
Accumulated other comprehensive loss |
|
|
(4,411 |
) |
|
(5,110 |
) |
Total Shareholders’ Equity |
|
$ |
409,366 |
|
$ |
373,396 |
|
Total Liabilities and Shareholders’ Equity |
|
$ |
656,747 |
|
$ |
676,564 |
|
|
Oxford Industries, Inc. |
Condensed Consolidated Statements of
Operations |
(in thousands, except per share amounts) |
(unaudited) |
|
|
Second Quarter Fiscal 2017 |
|
Second Quarter Fiscal 2016 |
|
First Half Fiscal 2017 |
|
First Half Fiscal 2016 |
Net sales |
|
$ |
284,709 |
|
$ |
282,996 |
|
$ |
557,072 |
|
$ |
539,231 |
Cost of
goods sold |
|
|
118,740 |
|
|
118,201 |
|
|
231,693 |
|
|
222,971 |
Gross
profit |
|
$ |
165,969 |
|
$ |
164,795 |
|
$ |
325,379 |
|
$ |
316,260 |
SG&A |
|
|
132,911 |
|
|
129,437 |
|
|
266,102 |
|
|
252,936 |
Royalties
and other operating income |
|
|
3,344 |
|
|
3,332 |
|
|
7,084 |
|
|
7,372 |
Operating
income |
|
$ |
36,402 |
|
$ |
38,690 |
|
$ |
66,361 |
|
$ |
70,696 |
Interest
expense, net |
|
|
742 |
|
|
1,177 |
|
|
1,672 |
|
|
1,791 |
Earnings from
continuing operations before income taxes |
|
$ |
35,660 |
|
$ |
37,513 |
|
$ |
64,689 |
|
$ |
68,905 |
Income
taxes |
|
|
12,971 |
|
|
13,638 |
|
|
24,803 |
|
|
24,853 |
Net earnings
from continuing operations |
|
$ |
22,689 |
|
$ |
23,875 |
|
$ |
39,886 |
|
$ |
44,052 |
Earnings
from discontinued operations, net of taxes |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
Net earnings |
|
$ |
22,689 |
|
$ |
23,875 |
|
$ |
39,886 |
|
$ |
44,052 |
|
|
|
|
|
|
Net earnings
from continuing operations per share: |
|
|
|
|
|
Basic |
|
$ |
1.37 |
|
$ |
1.45 |
|
$ |
2.41 |
|
$ |
2.67 |
Diluted |
|
$ |
1.36 |
|
$ |
1.44 |
|
$ |
2.39 |
|
$ |
2.65 |
Earnings from
discontinued operations, net of taxes, per share: |
|
|
|
|
|
Basic |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
— |
Diluted |
|
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
— |
Net earnings
per share: |
|
|
|
|
|
Basic |
|
$ |
1.37 |
|
$ |
1.45 |
|
$ |
2.41 |
|
$ |
2.67 |
Diluted |
|
$ |
1.36 |
|
$ |
1.44 |
|
$ |
2.39 |
|
$ |
2.65 |
Weighted
average shares outstanding: |
|
|
|
|
|
Basic |
|
|
16,605 |
|
|
16,515 |
|
|
16,577 |
|
|
16,509 |
Diluted |
|
|
16,700 |
|
|
16,623 |
|
|
16,698 |
|
|
16,620 |
Dividends
declared per share |
|
$ |
0.27 |
|
$ |
0.27 |
|
$ |
0.54 |
|
$ |
0.54 |
|
|
|
|
|
|
Oxford Industries, Inc. |
Condensed Consolidated Statements of Cash
Flows |
(in thousands) |
(unaudited) |
|
|
First Half Fiscal 2017 |
|
|
First Half Fiscal 2016 |
Cash Flows From
Operating Activities: |
|
|
|
|
|
|
|
|
Net earnings |
|
$ |
39,886 |
|
|
$ |
44,052 |
|
Adjustments to
reconcile net earnings to net cash provided by operating
activities: |
|
|
|
Depreciation |
|
|
19,486 |
|
|
|
19,278 |
|
Amortization of intangible assets |
|
|
1,082 |
|
|
|
1,120 |
|
Equity
compensation expense |
|
|
3,075 |
|
|
|
3,477 |
|
Amortization of deferred financing costs |
|
|
211 |
|
|
|
480 |
|
Deferred
income taxes |
|
|
1,942 |
|
|
|
4,985 |
|
Changes
in working capital, net of acquisitions and dispositions: |
|
|
|
Receivables, net |
|
|
(1,336 |
) |
|
|
5,370 |
|
Inventories, net |
|
|
23,731 |
|
|
|
12,985 |
|
Prepaid
expenses |
|
|
5,298 |
|
|
|
144 |
|
Current
liabilities |
|
|
(9,955 |
) |
|
|
(18,475 |
) |
Other
non-current assets, net |
|
|
22 |
|
|
|
(714 |
) |
Other non-current liabilities |
|
|
(307 |
) |
|
|
173 |
|
Cash provided by operating activities |
|
$ |
83,135 |
|
|
$ |
72,875 |
|
Cash Flows From
Investing Activities: |
|
|
|
Acquisitions, net of
cash acquired |
|
|
(614 |
) |
|
|
(94,960 |
) |
Purchases of property
and equipment |
|
|
(18,527 |
) |
|
|
(24,643 |
) |
Other
investing activities |
|
|
— |
|
|
|
(2,029 |
) |
Cash used in investing activities |
|
$ |
(19,141 |
) |
|
$ |
(121,632 |
) |
Cash Flows From
Financing Activities: |
|
|
|
Repayment of revolving
credit arrangements |
|
|
(163,703 |
) |
|
|
(304,212 |
) |
Proceeds from revolving
credit arrangements |
|
|
109,794 |
|
|
|
366,178 |
|
Deferred financing
costs paid |
|
|
— |
|
|
|
(1,385 |
) |
Proceeds from issuance
of common stock |
|
|
713 |
|
|
|
677 |
|
Repurchase of equity
awards for employee tax withholding liabilities |
|
|
(2,206 |
) |
|
|
(1,868 |
) |
Cash
dividends declared and paid |
|
|
(9,096 |
) |
|
|
(9,062 |
) |
Cash (used in) provided by financing
activities |
|
$ |
(64,498 |
) |
|
$ |
50,328 |
|
Net change in cash and
cash equivalents |
|
$ |
(504 |
) |
|
$ |
1,571 |
|
Effect of foreign
currency translation on cash and cash equivalents |
|
|
155 |
|
|
|
298 |
|
Cash and
cash equivalents at the beginning of year |
|
|
6,332 |
|
|
|
6,323 |
|
Cash and cash equivalents at the end of the
period |
|
$ |
5,983 |
|
|
$ |
8,192 |
|
Supplemental
disclosure of cash flow information: |
|
|
|
Cash paid for interest,
net |
|
$ |
1,543 |
|
|
$ |
1,477 |
|
Cash paid
for income taxes |
|
$ |
18,128 |
|
|
$ |
16,996 |
|
|
|
|
|
Oxford Industries, Inc. |
Reconciliations of Certain Non-GAAP Financial
Information |
(in millions, except per share amounts) |
(unaudited) |
|
|
|
|
AS
REPORTED |
|
Second Quarter Fiscal 2017 |
|
Second Quarter Fiscal 2016 |
|
% Change |
|
First Half Fiscal 2017 |
|
First Half Fiscal 2016 |
|
% Change |
Tommy
Bahama |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
sales |
|
$ |
187.6 |
|
|
$ |
184.1 |
|
|
1.9 |
% |
|
$ |
360.1 |
|
|
$ |
346.8 |
|
|
3.8 |
% |
Gross
profit |
|
$ |
110.0 |
|
|
$ |
108.2 |
|
|
1.7 |
% |
|
$ |
215.1 |
|
|
$ |
207.0 |
|
|
3.9 |
% |
Gross
margin |
|
|
58.6 |
% |
|
|
58.8 |
% |
|
|
|
59.8 |
% |
|
|
59.7 |
% |
|
|
Operating
income |
|
$ |
21.9 |
|
|
$ |
20.6 |
|
|
6.5 |
% |
|
$ |
38.0 |
|
|
$ |
33.9 |
|
|
12.0 |
% |
Operating margin |
|
|
11.7 |
% |
|
|
11.2 |
% |
|
|
|
10.5 |
% |
|
|
9.8 |
% |
|
|
Lilly
Pulitzer |
|
|
|
|
|
|
|
Net
sales |
|
$ |
69.5 |
|
|
$ |
69.7 |
|
|
(0.4 |
)% |
|
$ |
132.8 |
|
|
$ |
134.5 |
|
|
(1.2 |
)% |
Gross
profit |
|
$ |
46.6 |
|
|
$ |
46.5 |
|
|
0.4 |
% |
|
$ |
88.8 |
|
|
$ |
89.1 |
|
|
(0.4 |
)% |
Gross
margin |
|
|
67.1 |
% |
|
|
66.6 |
% |
|
|
|
66.8 |
% |
|
|
66.3 |
% |
|
|
Operating income |
|
$ |
21.0 |
|
|
$ |
22.6 |
|
|
(7.3 |
)% |
|
$ |
38.7 |
|
|
$ |
43.4 |
|
|
(11.0 |
)% |
Operating margin |
|
|
30.2 |
% |
|
|
32.5 |
% |
|
|
|
29.1 |
% |
|
|
32.3 |
% |
|
|
Lanier
Apparel |
|
|
|
|
|
|
|
Net
sales |
|
$ |
17.8 |
|
|
$ |
19.5 |
|
|
(8.7 |
)% |
|
$ |
41.2 |
|
|
$ |
46.2 |
|
|
(10.7 |
)% |
Gross
profit |
|
$ |
6.2 |
|
|
$ |
5.1 |
|
|
20.6 |
% |
|
$ |
13.2 |
|
|
$ |
13.7 |
|
|
(3.8 |
)% |
Gross
margin |
|
|
34.5 |
% |
|
|
26.1 |
% |
|
|
|
31.9 |
% |
|
|
29.7 |
% |
|
|
Operating
income |
|
$ |
0.2 |
|
|
$ |
0.1 |
|
|
150.0 |
% |
|
$ |
1.1 |
|
|
$ |
2.9 |
|
|
(64.2 |
)% |
Operating margin |
|
|
1.1 |
% |
|
|
0.4 |
% |
|
|
|
2.6 |
% |
|
|
6.4 |
% |
|
|
Southern
Tide |
|
|
|
|
|
|
|
Net
sales |
|
$ |
9.4 |
|
|
$ |
9.2 |
|
|
2.6 |
% |
|
$ |
22.0 |
|
|
$ |
10.6 |
|
|
108.3 |
% |
Gross
profit |
|
$ |
4.5 |
|
|
$ |
3.8 |
|
|
18.5 |
% |
|
$ |
11.0 |
|
|
$ |
4.3 |
|
|
152.6 |
% |
Gross
margin |
|
|
47.6 |
% |
|
|
41.2 |
% |
|
|
|
49.8 |
% |
|
|
41.0 |
% |
|
|
Operating
income |
|
$ |
0.6 |
|
|
$ |
0.0 |
|
|
NM |
|
|
$ |
2.7 |
|
|
$ |
0.0 |
|
|
NM |
|
Operating margin |
|
|
6.9 |
% |
|
|
0.0 |
% |
|
|
|
12.5 |
% |
|
|
0.4 |
% |
|
|
Corporate and
Other |
|
|
|
|
|
|
|
Net
sales |
|
$ |
0.4 |
|
|
$ |
0.5 |
|
|
NM |
|
|
$ |
1.0 |
|
|
$ |
1.2 |
|
|
NM |
|
Gross
profit |
|
$ |
(1.3 |
) |
|
$ |
1.3 |
|
|
NM |
|
|
$ |
(2.7 |
) |
|
$ |
2.1 |
|
|
NM |
|
Operating loss |
|
$ |
(7.3 |
) |
|
$ |
(4.6 |
) |
|
(59.3 |
)% |
|
$ |
(14.1 |
) |
|
$ |
(9.6 |
) |
|
(46.1 |
)% |
Consolidated |
|
|
|
|
|
|
|
Net
sales |
|
$ |
284.7 |
|
|
$ |
283.0 |
|
|
0.6 |
% |
|
$ |
557.1 |
|
|
$ |
539.2 |
|
|
3.3 |
% |
Gross
profit |
|
$ |
166.0 |
|
|
$ |
164.8 |
|
|
0.7 |
% |
|
$ |
325.4 |
|
|
$ |
316.3 |
|
|
2.9 |
% |
Gross
margin |
|
|
58.3 |
% |
|
|
58.2 |
% |
|
|
|
58.4 |
% |
|
|
58.7 |
% |
|
|
SG&A |
|
$ |
132.9 |
|
|
$ |
129.4 |
|
|
2.7 |
% |
|
$ |
266.1 |
|
|
$ |
252.9 |
|
|
5.2 |
% |
SG&A
as % of net sales |
|
|
46.7 |
% |
|
|
45.7 |
% |
|
|
|
47.8 |
% |
|
|
46.9 |
% |
|
|
Operating
income |
|
$ |
36.4 |
|
|
$ |
38.7 |
|
|
(5.9 |
)% |
|
$ |
66.4 |
|
|
$ |
70.7 |
|
|
(6.1 |
)% |
Operating
margin |
|
|
12.8 |
% |
|
|
13.7 |
% |
|
|
|
11.9 |
% |
|
|
13.1 |
% |
|
|
Earnings
from continuing operations before income taxes |
|
$ |
35.7 |
|
|
$ |
37.5 |
|
|
(4.9 |
)% |
|
$ |
64.7 |
|
|
$ |
68.9 |
|
|
(6.1 |
)% |
Net
earnings from continuing operations |
|
$ |
22.7 |
|
|
$ |
23.9 |
|
|
(5.0 |
)% |
|
$ |
39.9 |
|
|
$ |
44.1 |
|
|
(9.5 |
)% |
Net earnings from continuing operations per diluted share |
|
$ |
1.36 |
|
|
$ |
1.44 |
|
|
(5.6 |
)% |
|
$ |
2.39 |
|
|
$ |
2.65 |
|
|
(9.8 |
)% |
Weighted
average shares outstanding - diluted |
|
|
16.7 |
|
|
|
16.6 |
|
|
0.5 |
% |
|
|
16.7 |
|
|
|
16.6 |
|
|
0.5 |
% |
ADJUSTMENTS |
|
|
|
|
|
|
|
LIFO
adjustments(1) |
|
$ |
1.6 |
|
|
$ |
(1.0 |
) |
|
|
$ |
3.3 |
|
|
$ |
(1.3 |
) |
|
|
Inventory step-up
charges(2) |
|
$ |
0.0 |
|
|
$ |
1.0 |
|
|
|
$ |
0.0 |
|
|
$ |
1.1 |
|
|
|
Amortization of
Canadian intangible assets(3) |
|
$ |
0.4 |
|
|
$ |
0.4 |
|
|
|
$ |
0.7 |
|
|
$ |
0.7 |
|
|
|
Amortization of
Southern Tide intangible assets(4) |
|
$ |
0.1 |
|
|
$ |
0.2 |
|
|
|
$ |
0.1 |
|
|
$ |
0.2 |
|
|
|
Transaction expenses
for acquisitions(5) |
|
$ |
0.0 |
|
|
$ |
0.0 |
|
|
|
$ |
0.0 |
|
|
$ |
0.8 |
|
|
|
Distribution center
integration charges(6) |
|
$ |
0.0 |
|
|
$ |
0.5 |
|
|
|
$ |
0.0 |
|
|
$ |
0.5 |
|
|
|
Impact of
income taxes(7) |
|
$ |
(0.6 |
) |
|
$ |
(0.2 |
) |
|
|
$ |
(1.3 |
) |
|
$ |
(0.5 |
) |
|
|
Adjustment to net earnings from continuing operations(8) |
|
$ |
1.4 |
|
|
$ |
0.8 |
|
|
|
$ |
2.8 |
|
|
$ |
1.6 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Second Quarter Fiscal 2017 |
|
Second Quarter Fiscal 2016 |
|
% Change |
|
First Half Fiscal 2017 |
|
First Half Fiscal 2016 |
|
% Change |
AS
ADJUSTED |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tommy
Bahama |
|
|
|
|
|
|
|
Net
sales |
|
$ |
187.6 |
|
|
$ |
184.1 |
|
|
1.9 |
% |
|
$ |
360.1 |
|
|
$ |
346.8 |
|
|
3.8 |
% |
Gross
profit |
|
$ |
110.0 |
|
|
$ |
108.2 |
|
|
1.7 |
% |
|
$ |
215.1 |
|
|
$ |
207.0 |
|
|
3.9 |
% |
Gross
margin |
|
|
58.6 |
% |
|
|
58.8 |
% |
|
|
|
59.8 |
% |
|
|
59.7 |
% |
|
|
Operating
income |
|
$ |
22.3 |
|
|
$ |
21.0 |
|
|
6.4 |
% |
|
$ |
38.7 |
|
|
$ |
34.6 |
|
|
11.7 |
% |
Operating margin |
|
|
11.9 |
% |
|
|
11.4 |
% |
|
|
|
10.7 |
% |
|
|
10.0 |
% |
|
|
Lilly
Pulitzer |
|
|
|
|
|
|
|
Net
sales |
|
$ |
69.5 |
|
|
$ |
69.7 |
|
|
(0.4 |
)% |
|
$ |
132.8 |
|
|
$ |
134.5 |
|
|
(1.2 |
)% |
Gross
profit |
|
$ |
46.6 |
|
|
$ |
46.5 |
|
|
0.4 |
% |
|
$ |
88.8 |
|
|
$ |
89.1 |
|
|
(0.4 |
)% |
Gross
margin |
|
|
67.1 |
% |
|
|
66.6 |
% |
|
|
|
66.8 |
% |
|
|
66.3 |
% |
|
|
Operating income |
|
$ |
21.0 |
|
|
$ |
22.6 |
|
|
(7.3 |
)% |
|
$ |
38.7 |
|
|
$ |
43.4 |
|
|
(11.0 |
)% |
Operating margin |
|
|
30.2 |
% |
|
|
32.5 |
% |
|
|
|
29.1 |
% |
|
|
32.3 |
% |
|
|
Lanier
Apparel |
|
|
|
|
|
|
|
Net
sales |
|
$ |
17.8 |
|
|
$ |
19.5 |
|
|
(8.7 |
)% |
|
$ |
41.2 |
|
|
$ |
46.2 |
|
|
(10.7 |
)% |
Gross
profit |
|
$ |
6.2 |
|
|
$ |
5.1 |
|
|
20.6 |
% |
|
$ |
13.2 |
|
|
$ |
13.7 |
|
|
(3.8 |
)% |
Gross
margin |
|
|
34.5 |
% |
|
|
26.1 |
% |
|
|
|
31.9 |
% |
|
|
29.7 |
% |
|
|
Operating
income |
|
$ |
0.2 |
|
|
$ |
0.1 |
|
|
150.0 |
% |
|
$ |
1.1 |
|
|
$ |
2.9 |
|
|
(64.2 |
)% |
Operating margin |
|
|
1.1 |
% |
|
|
0.4 |
% |
|
|
|
2.6 |
% |
|
|
6.4 |
% |
|
|
Southern
Tide |
|
|
|
|
|
|
|
Net
sales |
|
$ |
9.4 |
|
|
$ |
9.2 |
|
|
2.6 |
% |
|
$ |
22.0 |
|
|
$ |
10.6 |
|
|
108.3 |
% |
Gross
profit |
|
$ |
4.5 |
|
|
$ |
4.7 |
|
|
(5.9 |
)% |
|
$ |
11.0 |
|
|
$ |
5.5 |
|
|
100.5 |
% |
Gross
margin |
|
|
47.6 |
% |
|
|
51.9 |
% |
|
|
|
49.8 |
% |
|
|
51.7 |
% |
|
|
Operating
income |
|
$ |
0.7 |
|
|
$ |
1.6 |
|
|
(54.8 |
)% |
|
$ |
2.9 |
|
|
|
1.8 |
|
|
57.3 |
% |
Operating margin |
|
|
7.6 |
% |
|
|
17.3 |
% |
|
|
|
13.1 |
% |
|
|
17.4 |
% |
|
|
Corporate and
Other |
|
|
|
|
|
|
|
Net
sales |
|
$ |
0.4 |
|
|
$ |
0.5 |
|
|
NM |
|
|
$ |
1.0 |
|
|
$ |
1.2 |
|
|
NM |
|
Gross
profit |
|
$ |
0.3 |
|
|
$ |
0.3 |
|
|
NM |
|
|
$ |
0.6 |
|
|
$ |
0.9 |
|
|
NM |
|
Operating loss |
|
$ |
(5.8 |
) |
|
$ |
(5.6 |
) |
|
(3.7 |
)% |
|
$ |
(10.8 |
) |
|
$ |
(10.1 |
) |
|
(6.7 |
)% |
Consolidated |
|
|
|
|
|
|
|
Net
sales |
|
$ |
284.7 |
|
|
$ |
283.0 |
|
|
0.6 |
% |
|
$ |
557.1 |
|
|
$ |
539.2 |
|
|
3.3 |
% |
Gross
profit |
|
$ |
167.5 |
|
|
$ |
164.8 |
|
|
1.7 |
% |
|
$ |
328.7 |
|
|
$ |
316.1 |
|
|
4.0 |
% |
Gross
margin |
|
|
58.8 |
% |
|
|
58.2 |
% |
|
|
|
59.0 |
% |
|
|
58.6 |
% |
|
|
SG&A |
|
$ |
132.5 |
|
|
$ |
128.4 |
|
|
3.1 |
% |
|
$ |
265.2 |
|
|
$ |
250.8 |
|
|
5.8 |
% |
SG&A
as % of net sales |
|
|
46.5 |
% |
|
|
45.4 |
% |
|
|
|
47.6 |
% |
|
|
46.5 |
% |
|
|
Operating
income |
|
$ |
38.4 |
|
|
$ |
39.7 |
|
|
(3.2 |
)% |
|
$ |
70.5 |
|
|
$ |
72.7 |
|
|
(3.1 |
)% |
Operating
margin |
|
|
13.5 |
% |
|
|
14.0 |
% |
|
|
|
12.7 |
% |
|
|
13.5 |
% |
|
|
Earnings
from continuing operations before income taxes |
|
$ |
37.7 |
|
|
$ |
38.5 |
|
|
(2.2 |
)% |
|
$ |
68.8 |
|
|
$ |
71.0 |
|
|
(3.0 |
)% |
Net
earnings from continuing operations |
|
$ |
24.1 |
|
|
$ |
24.6 |
|
|
(2.3 |
)% |
|
$ |
42.7 |
|
|
$ |
45.6 |
|
|
(6.3 |
)% |
Net earnings from continuing operations per diluted share |
|
$ |
1.44 |
|
|
$ |
1.48 |
|
|
(2.7 |
)% |
|
$ |
2.56 |
|
|
$ |
2.74 |
|
|
(6.6 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Second Quarter Fiscal 2017 |
Second Quarter Fiscal 2017 |
Second Quarter Fiscal 2016 |
First Half Fiscal 2017 |
First Half Fiscal 2016 |
|
|
Actual |
Guidance(9) |
Actual |
Actual |
Actual |
Net earnings (loss)
from continuing operations per diluted share: |
|
|
|
|
|
|
|
|
|
|
GAAP basis |
|
$1.36 |
$1.33
- $1.43 |
$1.44 |
$ |
2.39 |
|
$ |
2.65 |
|
LIFO
adjustments(10) |
|
0.06 |
0.00 |
(0.04) |
|
0.12 |
|
|
(0.05 |
) |
Inventory step-up
charges(11) |
|
0.00 |
0.00 |
0.04 |
|
0.00 |
|
|
0.04 |
|
Amortization of
recently acquired intangible assets(12) |
|
0.02 |
0.02 |
0.03 |
|
0.05 |
|
|
0.05 |
|
Transaction expenses and integration costs for recent
acquisitions(13) |
|
0.00 |
0.00 |
0.02 |
|
0.00 |
|
|
0.04 |
|
As
adjusted(8) |
|
$1.44 |
$1.35 - $1.45 |
$1.48 |
$ |
2.56 |
|
$ |
2.74 |
|
|
|
|
|
|
|
|
|
|
Third Quarter Fiscal 2017 |
Third Quarter Fiscal 2016 |
Fiscal 2017 |
Fiscal 2016 |
|
|
|
Guidance(14) |
Actual |
Guidance(14) |
Actual |
|
Net earnings (loss)
from continuing operations per diluted share: |
|
|
|
|
|
|
GAAP basis |
|
$0.04 - $0.14 |
$(0.10) |
$3.23 - 3.43 |
$3.27 |
|
LIFO
adjustments(10) |
|
0.00 |
(0.04) |
0.12 |
(0.22) |
|
Inventory step-up
charges(11) |
|
0.00 |
0.04 |
0.00 |
0.10 |
|
Amortization of
recently acquired intangible assets(12) |
|
0.03 |
0.03 |
0.11 |
0.10 |
|
Transaction expenses
and integration costs for recent acquisitions(13) |
|
0.02 |
0.00 |
0.03 |
0.04 |
|
As adjusted(8) |
|
$0.09 - $0.19 |
$(0.07) |
$3.50 - $3.70 |
$3.30 |
|
|
|
|
|
|
|
|
(1) LIFO
adjustments represent the impact on cost of goods sold resulting
from LIFO accounting adjustments. LIFO adjustments are included in
Corporate and Other. |
(2)
Inventory step-up charges represent the impact of purchase
accounting adjustments resulting from the step-up of inventory at
acquisition related to the Southern Tide acquisition. These
inventory step-up charges are included in cost of goods sold in
Southern Tide. |
(3)
Amortization of Canadian intangible assets represents the
amortization related to the intangible assets acquired as part of
the Tommy Bahama Canada acquisition. Amortization of Canadian
intangible assets are included in SG&A in Tommy Bahama. |
(4)
Amortization of Southern Tide intangible assets represents the
amortization related to the intangible assets acquired as part of
the Southern Tide acquisition. Amortization of Southern Tide
intangible assets are included in SG&A in Southern Tide. |
(5)
Transaction expenses for acquisitions represent the transaction
costs associated with the Southern Tide acquisition. These
transaction expenses for acquisition are included in SG&A in
Corporate and Other. |
(6)
Distribution center integration charges represent the impact
resulting from the one-time charges related to transitioning
Southern Tide's distribution center functions during the Second
Quarter of Fiscal 2016. |
(7) Impact
of income taxes represents the estimated tax impact of the above
adjustments based on the applicable estimated effective tax rate on
current year earnings in the respective jurisdiction, before any
discrete items. |
(8)
Amounts in columns may not add due to rounding. |
(9)
Guidance as issued on June 6, 2017. |
(10) LIFO
adjustments represent the impact, net of income taxes, on net
earnings from continuing operations per diluted share resulting
from LIFO accounting adjustments. No estimate for future LIFO
accounting adjustments are reflected in the guidance for any period
presented. |
(11)
Inventory step-up charges represent the impact, net of income
taxes, on net earnings from continuing operations per diluted share
resulting from inventory step-up charges related to the Southern
Tide acquisition. |
(12)
Amortization of recently acquired intangible assets represents the
impact, net of income taxes, on net earnings from continuing
operations per diluted share resulting from the amortization of
intangible assets acquired as part of the Tommy Bahama Canada,
Southern Tide and Lilly Pulitzer Signature Store acquisitions, as
applicable. |
(13)
Transaction expenses and integration costs for recent acquisitions
represents the impact, net of income taxes, on net earnings from
continuing operations per diluted share relating to transaction
expenses and integration costs incurred principally with the Fiscal
2016 Southern Tide and Fiscal 2017 Lilly Pulitzer Signature Store
acquisitions, as applicable, which includes costs associated with
distribution center integration, consulting and transition fees and
other amounts paid to third parties. |
(14)
Guidance as issued on August 31, 2017. |
|
Comparable Store Sales Change |
The
Company's disclosures about comparable store sales include sales
from its full-price stores and e-commerce sites, excluding sales
associated with e-commerce flash clearance sales. Prior period
comparable store sales changes are as previously disclosed. |
|
Q1 |
Q2 |
Q3 |
Q4 |
Full Year |
Tommy
Bahama |
|
|
|
|
|
Fiscal
2017 |
5% |
4% |
—% |
—% |
—% |
Fiscal
2016 |
(13)% |
7% |
(6)% |
(3)% |
(3)% |
Fiscal
2015 |
8% |
3% |
(5)% |
2% |
3% |
Lilly
Pulitzer |
|
|
|
|
|
Fiscal
2017 |
(7)% |
(6)% |
—% |
—% |
—% |
Fiscal
2016 |
1% |
(1)% |
12% |
2% |
2% |
Fiscal
2015 |
20% |
41% |
27% |
13% |
27% |
|
|
|
|
|
|
Retail Location Count |
|
|
Beginning of Year |
|
End of Q1 |
|
End of Q2 |
|
End of Q3 |
|
End of Q4 |
Tommy
Bahama |
|
|
|
|
|
|
|
|
|
|
Fiscal 2017 |
|
|
|
|
|
|
|
|
|
|
Full-price |
|
111 |
|
112 |
|
111 |
|
— |
|
— |
Retail-restaurant |
|
17 |
|
17 |
|
17 |
|
— |
|
— |
Outlet |
|
40 |
|
40 |
|
39 |
|
— |
|
— |
Total |
|
168 |
|
169 |
|
167 |
|
— |
|
— |
Fiscal 2016 |
|
|
|
|
|
|
|
|
|
|
Full-price |
|
107 |
|
109 |
|
111 |
|
113 |
|
111 |
Retail-restaurant |
|
16 |
|
16 |
|
16 |
|
16 |
|
17 |
Outlet |
|
41 |
|
41 |
|
41 |
|
41 |
|
40 |
Total |
|
164 |
|
166 |
|
168 |
|
170 |
|
168 |
|
|
|
|
|
|
|
|
|
|
|
Lilly
Pulitzer |
|
|
|
|
|
|
|
|
|
|
Fiscal 2017 |
|
|
|
|
|
|
|
|
|
|
Full-price |
|
40 |
|
41 |
|
50 |
|
— |
|
— |
Fiscal 2016 |
|
|
|
|
|
|
|
|
|
|
Full-price |
|
34 |
|
34 |
|
37 |
|
39 |
|
40 |
|
Contact: Anne M. Shoemaker
Telephone: (404) 653-1455
Fax: (404) 653-1545
E-mail: InvestorRelations@oxfordinc.com
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