--Achieves Significant Year-Over-Year Growth in
Sales and Earnings----Third Quarter GAAP EPS of $0.06; Adjusted EPS
of $0.17----Narrows Full-Year GAAP EPS Guidance Range to $3.23 -
$3.38 and Full-Year Adjusted EPS to $3.55 - $3.70--
Oxford Industries, Inc. (NYSE:OXM) today announced financial
results for its fiscal 2017 third quarter ended October 28, 2017.
Consolidated net sales in the third quarter of fiscal 2017
increased 6% to $236.0 million compared to $222.3 million in the
third quarter of fiscal 2016. Earnings on a GAAP basis were $0.06
per share in the third quarter of fiscal 2017 compared to a loss of
$0.10 in the same period of the prior year. On an adjusted
basis, earnings were $0.17 per share in the third quarter of fiscal
2017 compared to a loss of $0.07 in the third quarter of fiscal
2016.
Thomas C. Chubb III, Chairman and CEO, commented, “We are proud
of our third quarter results. Our dynamic portfolio of strong
lifestyle brands delivered solid year-over-year growth on both the
top and bottom lines. A modest negative impact to earnings
from the recent hurricanes was offset by some favorable tax
benefits recognized in the quarter. More importantly, we are
well-positioned for opportunities created by the emerging optimism
among consumers during this holiday market.”
Mr. Chubb concluded, “The positive momentum that resulted in a
4% increase in comparable store sales in the third quarter gives us
confidence that we can continue to drive growth in the fourth
quarter. Our brands have excellent plans centered on compelling
product and innovative marketing campaigns that we believe will set
us apart in this highly competitive and promotional holiday
season.”
Consolidated Operating Results
Consolidated net sales in the third quarter of fiscal 2017
increased 6% year-over-year to $236.0 million, led by meaningful
increases at Lanier Apparel, Lilly Pulitzer and Southern
Tide. Net sales at Tommy Bahama were 2% lower than the prior
year’s third quarter, with increases in all full price direct to
consumer channels offset by lower year-over-year sales in its
off-price direct to consumer channels.
Gross profit in the third quarter increased 6% to $125.2 million
compared to $118.1 million in the same period of the prior year.
Gross margin in the third quarter of fiscal 2017 was flat with last
year at 53.0% compared to 53.1% in the prior year. On an adjusted
basis, gross margin expanded 60 basis points to 53.7% compared to
53.1% in the prior year.
In the third quarter of fiscal 2017, SG&A improved to 53.9%
of net sales or $127.1 million compared to 54.6% or $121.4 million
in the prior year’s third quarter. The increase in SG&A was
primarily due to incremental costs associated with operating
additional retail stores and increased incentive compensation.
For the third quarter of fiscal 2017, royalties and other
operating income were in line with the prior year at $3.0 million
compared to $3.1 million in the third quarter of fiscal
2016.
Operating income in the third quarter of fiscal 2017 was $1.1
million compared to an operating loss of $0.3 million in the same
period of the prior year. On an adjusted basis, operating income
was $3.8 million compared to $0.2 million in the third quarter of
fiscal 2016.
Interest expense for the third quarter of fiscal 2017 was flat
with last year at $0.7 million.
Tax expense in the third quarter of fiscal 2017 benefited from
$0.8 million of discrete items, which had a meaningful impact on
the effective tax rate due to lower earnings in the third quarter,
which is historically the Company’s smallest quarter.
The Company estimates Hurricanes Harvey and Irma resulted in
lost sales and earnings per share of approximately $2 million and
$0.05, respectively.
Balance Sheet and Liquidity
Inventory turns improved on an inventory decrease of 7% to
$127.3 million at October 28, 2017 from $136.4 million at the end
of the third quarter of fiscal 2016. The Company believes
that inventories in each operating group are appropriate to support
future sales and a sustained solid gross margin.
As of October 28, 2017, the Company had $72.1 million of
borrowings outstanding under its $325 million revolving credit
agreement compared to $142.4 million at the end of the third
quarter of fiscal 2016, with the decrease attributable to strong
cash flow from operations. The Company ended the quarter with
$204.6 million of unused availability under its credit
agreement.
Fiscal Year 2017 Outlook
For the full year fiscal 2017, the Company now expects GAAP
earnings per share to be between $3.23 and $3.38. Adjusted earnings
per share are expected to be between $3.55 and $3.70. This compares
to fiscal 2016 earnings on a GAAP basis of $3.27 per share and, on
an adjusted basis, $3.30 per share. The Company expects net sales
to grow to between $1.08 billion to $1.095 billion as compared to
fiscal 2016 net sales of $1.023 billion.
The Company’s effective tax rate for fiscal 2017 is expected to
be approximately 37%, comparable to the fiscal 2016 rate. Full year
interest expense is estimated to be approximately $3.0 million.
Capital expenditures in fiscal 2017, including $26.4 million in
the first nine months of fiscal 2017, are expected to be
approximately $40 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 February 2,
2018 to shareholders of record as of the close of business on
January 19, 2018. 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 December 19, 2017 by dialing (412) 317-6671
access code 8291220.
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 with the extra week included in the fourth
quarter.
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; 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; changes in international, federal or state
tax, trade and other laws and regulations, including the impact of
potential federal tax reform in the United States; 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.
Contact: Anne M.
Shoemaker
Telephone: (404)
653-1455
Fax: (404)
653-1545
E-mail: InvestorRelations@oxfordinc.com
Oxford Industries, Inc. |
Condensed Consolidated Balance
Sheets |
(in thousands, except par
amounts) |
(unaudited) |
|
October 28, 2017 |
October 29, 2016 |
ASSETS |
|
|
Current
Assets |
|
|
Cash and cash
equivalents |
$ |
6,077 |
|
$ |
5,351 |
|
Receivables, net |
|
73,724 |
|
|
68,492 |
|
Inventories, net |
|
127,301 |
|
|
136,383 |
|
Prepaid
expenses |
|
27,619 |
|
|
29,558 |
|
Total Current
Assets |
$ |
234,721 |
|
$ |
239,784 |
|
Property and equipment,
net |
|
191,038 |
|
|
195,799 |
|
Intangible assets,
net |
|
175,057 |
|
|
185,957 |
|
Goodwill |
|
63,443 |
|
|
51,053 |
|
Other
non-current assets, net |
|
24,250 |
|
|
22,882 |
|
Total Assets |
$ |
688,509 |
|
$ |
695,475 |
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY |
|
|
|
|
|
|
Current
Liabilities |
|
|
|
|
|
|
Accounts payable |
$ |
59,230 |
|
$ |
53,144 |
|
Accrued
compensation |
|
24,434 |
|
|
18,181 |
|
Other accrued expenses
and liabilities |
|
30,542 |
|
|
26,358 |
|
Liabilities related to discontinued operations |
|
3,709 |
|
|
— |
|
Total Current
Liabilities |
$ |
117,915 |
|
$ |
97,683 |
|
Long-term debt |
|
72,131 |
|
|
142,425 |
|
Other non-current
liabilities |
|
73,487 |
|
|
69,176 |
|
Deferred taxes |
|
16,829 |
|
|
13,643 |
|
Liabilities related to
discontinued operations |
|
972 |
|
|
3,279 |
|
Commitments and
contingencies |
|
|
|
|
|
|
Shareholders’
Equity |
|
|
|
|
|
|
Common stock,
$1.00 par value per share |
|
16,833 |
|
|
16,773 |
|
Additional paid-in
capital |
|
134,561 |
|
|
129,762 |
|
Retained earnings |
|
260,809 |
|
|
228,016 |
|
Accumulated other comprehensive loss |
|
(5,028 |
) |
|
(5,282 |
) |
Total Shareholders’ Equity |
$ |
407,175 |
|
$ |
369,269 |
|
Total Liabilities and Shareholders’ Equity |
$ |
688,509 |
|
$ |
695,475 |
|
|
Oxford Industries, Inc. |
Condensed Consolidated Statements of
Operations |
(in thousands, except per share
amounts) |
(unaudited) |
|
Third Quarter Fiscal 2017 |
Third Quarter Fiscal 2016 |
First Nine Months Fiscal 2017 |
First Nine Months Fiscal 2016 |
Net sales |
$ |
235,960 |
|
$ |
222,308 |
|
$ |
793,032 |
|
$ |
761,539 |
Cost of
goods sold |
|
110,784 |
|
|
104,254 |
|
|
342,477 |
|
|
327,225 |
Gross
profit |
$ |
125,176 |
|
$ |
118,054 |
|
$ |
450,555 |
|
$ |
434,314 |
SG&A |
|
127,091 |
|
|
121,442 |
|
|
393,193 |
|
|
374,379 |
Royalties
and other operating income |
|
3,039 |
|
|
3,061 |
|
|
10,123 |
|
|
10,433 |
Operating
income (loss) |
$ |
1,124 |
|
$ |
(327 |
) |
$ |
67,485 |
|
$ |
70,368 |
Interest
expense, net |
|
683 |
|
|
716 |
|
|
2,355 |
|
|
2,505 |
Earnings (loss)
from continuing operations before income taxes |
$ |
441 |
|
$ |
(1,043 |
) |
$ |
65,130 |
|
$ |
67,863 |
Income
taxes |
|
(631 |
) |
|
555 |
|
|
24,172 |
|
|
25,408 |
Net earnings
(loss) from continuing operations |
$ |
1,072 |
|
$ |
(1,598 |
) |
$ |
40,958 |
|
$ |
42,455 |
Earnings
from discontinued operations, net of taxes |
|
— |
|
|
— |
|
|
— |
|
|
— |
Net earnings (loss) |
$ |
1,072 |
|
$ |
(1,598 |
) |
$ |
40,958 |
|
$ |
42,455 |
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings
(loss) from continuing operations per share: |
|
|
|
|
|
|
|
|
|
|
|
Basic |
$ |
0.06 |
|
$ |
(0.10 |
) |
$ |
2.47 |
|
$ |
2.57 |
Diluted |
$ |
0.06 |
|
$ |
(0.10 |
) |
$ |
2.45 |
|
$ |
2.55 |
Earnings from
discontinued operations, net of taxes, per share: |
|
|
|
|
|
|
|
|
|
|
|
Basic |
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
— |
Diluted |
$ |
— |
|
$ |
— |
|
$ |
— |
|
$ |
— |
Net earnings
(loss) per share: |
|
|
|
|
|
|
|
|
|
|
|
Basic |
$ |
0.06 |
|
$ |
(0.10 |
) |
$ |
2.47 |
|
$ |
2.57 |
Diluted |
$ |
0.06 |
|
$ |
(0.10 |
) |
$ |
2.45 |
|
$ |
2.55 |
Weighted
average shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
16,618 |
|
|
16,531 |
|
|
16,591 |
|
|
16,516 |
Diluted |
|
16,735 |
|
|
16,531 |
|
|
16,710 |
|
|
16,635 |
Dividends
declared per share |
$ |
0.27 |
|
$ |
0.27 |
|
$ |
0.81 |
|
$ |
0.81 |
|
|
|
|
|
Oxford Industries, Inc. |
Condensed Consolidated Statements of Cash
Flows |
(in thousands) |
(unaudited) |
|
First Nine Months Fiscal 2017 |
First Nine Months Fiscal 2016 |
Cash Flows From
Operating Activities: |
|
|
Net earnings |
$ |
40,958 |
|
$ |
42,455 |
|
Adjustments to
reconcile net earnings to net cash provided by operating
activities: |
|
|
Depreciation |
|
29,779 |
|
|
29,070 |
|
Amortization of intangible assets |
|
1,733 |
|
|
1,744 |
|
Equity
compensation expense |
|
4,616 |
|
|
5,332 |
|
Amortization of deferred financing costs |
|
317 |
|
|
586 |
|
Deferred
income taxes |
|
3,376 |
|
|
6,008 |
|
Changes
in working capital, net of acquisitions and dispositions: |
|
|
Receivables, net |
|
(17,227 |
) |
|
(2,204 |
) |
Inventories, net |
|
17,017 |
|
|
10,118 |
|
Prepaid
expenses |
|
(2,713 |
) |
|
(6,510 |
) |
Current
liabilities |
|
(14,217 |
) |
|
(33,229 |
) |
Other
non-current assets, net |
|
(241 |
) |
|
(717 |
) |
Other non-current liabilities |
|
1,880 |
|
|
654 |
|
Cash provided by operating activities |
$ |
65,278 |
|
$ |
53,307 |
|
Cash Flows From
Investing Activities: |
|
|
Acquisitions, net of
cash acquired |
|
(5,055 |
) |
|
(94,960 |
) |
Purchases of property
and equipment |
|
(26,357 |
) |
|
(40,144 |
) |
Other
investing activities |
|
— |
|
|
(2,029 |
) |
Cash used in investing activities |
$ |
(31,412 |
) |
$ |
(137,133 |
) |
Cash Flows From
Financing Activities: |
|
|
Repayment of revolving
credit arrangements |
|
(199,765 |
) |
|
(339,560 |
) |
Proceeds from revolving
credit arrangements |
|
180,387 |
|
|
438,010 |
|
Deferred financing
costs paid |
|
— |
|
|
(1,430 |
) |
Proceeds from issuance
of common stock |
|
1,071 |
|
|
993 |
|
Repurchase of equity
awards for employee tax withholding liabilities |
|
(2,206 |
) |
|
(1,868 |
) |
Cash
dividends declared and paid |
|
(13,641 |
) |
|
(13,590 |
) |
Cash (used in) provided by financing
activities |
$ |
(34,154 |
) |
$ |
82,555 |
|
Net change in cash and
cash equivalents |
$ |
(288 |
) |
$ |
(1,271 |
) |
Effect of foreign
currency translation on cash and cash equivalents |
|
33 |
|
|
299 |
|
Cash and
cash equivalents at the beginning of year |
|
6,332 |
|
|
6,323 |
|
Cash and cash equivalents at the end of the
period |
$ |
6,077 |
|
$ |
5,351 |
|
Supplemental
disclosure of cash flow information: |
|
|
Cash paid for interest,
net |
$ |
2,098 |
|
$ |
2,067 |
|
Cash paid
for income taxes |
$ |
19,536 |
|
$ |
26,103 |
|
|
|
|
Oxford Industries, Inc. |
|
|
|
Reconciliations of Certain Non-GAAP Financial
Information |
|
|
|
(in millions, except per share
amounts) |
|
|
|
(unaudited) |
|
|
|
AS
REPORTED |
Third Quarter Fiscal 2017 |
Third Quarter Fiscal 2016 |
% Change |
First Nine Months Fiscal 2017 |
First Nine Months Fiscal 2016 |
% Change |
Tommy
Bahama |
|
|
|
|
|
|
Net
sales |
$ |
123.9 |
|
$ |
126.0 |
|
(1.6 |
)% |
$ |
484.0 |
|
$ |
472.8 |
|
2.4 |
% |
Gross
profit |
$ |
74.3 |
|
$ |
73.9 |
|
0.5 |
% |
$ |
289.4 |
|
$ |
280.9 |
|
3.0 |
% |
Gross
margin |
|
60.0 |
% |
|
58.7 |
% |
|
|
59.8 |
% |
|
59.4 |
% |
|
Operating
income (loss) |
$ |
(5.9 |
) |
$ |
(7.1 |
) |
17.7 |
% |
$ |
32.1 |
|
$ |
26.8 |
|
19.9 |
% |
Operating margin |
|
(4.7 |
)% |
|
(5.7 |
)% |
|
|
6.6 |
% |
|
5.7 |
% |
|
Lilly
Pulitzer |
|
|
|
|
|
|
Net
sales |
$ |
59.2 |
|
$ |
52.3 |
|
13.2 |
% |
$ |
192.0 |
|
$ |
186.8 |
|
2.8 |
% |
Gross
profit |
$ |
32.9 |
|
$ |
30.3 |
|
8.7 |
% |
$ |
121.7 |
|
$ |
119.4 |
|
1.9 |
% |
Gross
margin |
|
55.5 |
% |
|
57.8 |
% |
|
|
63.3 |
% |
|
63.9 |
% |
|
Operating
income |
$ |
5.0 |
|
$ |
6.2 |
|
(20.3 |
)% |
$ |
43.6 |
|
$ |
49.6 |
|
(12.1 |
)% |
Operating margin |
|
8.4 |
% |
|
11.9 |
% |
|
|
22.7 |
% |
|
26.6 |
% |
|
Lanier
Apparel |
|
|
|
|
|
|
Net
sales |
$ |
43.1 |
|
$ |
35.1 |
|
22.9 |
% |
$ |
84.3 |
|
$ |
81.2 |
|
3.8 |
% |
Gross
profit |
$ |
13.2 |
|
$ |
9.4 |
|
39.7 |
% |
$ |
26.4 |
|
$ |
23.1 |
|
13.9 |
% |
Gross
margin |
|
30.6 |
% |
|
26.9 |
% |
|
|
31.3 |
% |
|
28.5 |
% |
|
Operating
income |
$ |
5.6 |
|
$ |
3.7 |
|
53.2 |
% |
$ |
6.7 |
|
$ |
6.6 |
|
0.9 |
% |
Operating margin |
|
13.0 |
% |
|
10.5 |
% |
|
|
7.9 |
% |
|
8.1 |
% |
|
Southern
Tide |
|
|
|
|
|
|
Net
sales |
$ |
9.2 |
|
$ |
8.7 |
|
6.1 |
% |
$ |
31.3 |
|
$ |
19.3 |
|
NM |
|
Gross
profit |
$ |
4.9 |
|
$ |
3.2 |
|
52.9 |
% |
$ |
15.8 |
|
$ |
7.5 |
|
NM |
|
Gross
margin |
|
53.0 |
% |
|
36.8 |
% |
|
|
50.7 |
% |
|
39.1 |
% |
|
|
Operating
income (loss) |
$ |
1.0 |
|
|
(0.5 |
) |
NM |
|
$ |
3.8 |
|
$ |
(0.4 |
) |
NM |
|
Operating margin |
|
11.0 |
% |
|
(5.4 |
)% |
|
|
|
12.0 |
% |
|
(2.2 |
)% |
|
|
Corporate and
Other |
|
|
|
|
|
|
|
|
Net
sales |
$ |
0.5 |
|
$ |
0.3 |
|
NM |
|
$ |
1.4 |
|
$ |
1.5 |
|
NM |
|
Gross
profit |
$ |
(0.1 |
) |
$ |
1.2 |
|
NM |
|
$ |
(2.7 |
) |
$ |
3.4 |
|
NM |
|
Operating loss |
$ |
(4.6 |
) |
$ |
(2.6 |
) |
(76.4 |
)% |
$ |
(18.7 |
) |
$ |
(12.2 |
) |
(52.6 |
)% |
Consolidated |
|
|
|
|
|
|
Net
sales |
$ |
236.0 |
|
$ |
222.3 |
|
6.1 |
% |
$ |
793.0 |
|
$ |
761.5 |
|
4.1 |
% |
Gross
profit |
$ |
125.2 |
|
$ |
118.1 |
|
6.0 |
% |
$ |
450.6 |
|
$ |
434.3 |
|
3.7 |
% |
Gross
margin |
|
53.0 |
% |
|
53.1 |
% |
|
|
56.8 |
% |
|
57.0 |
% |
|
SG&A |
$ |
127.1 |
|
$ |
121.4 |
|
4.7 |
% |
$ |
393.2 |
|
$ |
374.4 |
|
5.0 |
% |
SG&A
as % of net sales |
|
53.9 |
% |
|
54.6 |
% |
|
|
49.6 |
% |
|
49.2 |
% |
|
Operating
income (loss) |
$ |
1.1 |
|
$ |
(0.3 |
) |
NM |
|
$ |
67.5 |
|
$ |
70.4 |
|
(4.1 |
)% |
Operating
margin |
|
0.5 |
% |
|
(0.1 |
)% |
|
|
|
8.5 |
% |
|
9.2 |
% |
|
Earnings
(loss) from continuing operations before income taxes |
$ |
0.4 |
|
$ |
(1.0 |
) |
NM |
|
$ |
65.1 |
|
$ |
67.9 |
|
(4.0 |
)% |
Net
earnings (loss) from continuing operations |
$ |
1.1 |
|
$ |
(1.6 |
) |
NM |
|
$ |
41.0 |
|
$ |
42.5 |
|
(3.5 |
)% |
Net earnings (loss) from continuing operations per diluted
share |
$ |
0.06 |
|
$ |
(0.10 |
) |
NM |
|
$ |
2.45 |
|
$ |
2.55 |
|
(3.9 |
)% |
Weighted
average shares outstanding - diluted |
|
16.7 |
|
|
16.5 |
|
1.2 |
% |
|
16.7 |
|
|
16.6 |
|
0.5 |
% |
ADJUSTMENTS |
|
|
|
|
|
|
LIFO adjustments
included in Corporate and Other(1) |
$ |
0.5 |
|
$ |
(1.0 |
) |
|
$ |
3.7 |
|
$ |
(2.3 |
) |
|
Inventory step-up
charges included in Southern Tide(2) |
$ |
— |
|
$ |
1.0 |
|
|
$ |
— |
|
$ |
2.1 |
|
|
Inventory step-up
charges included in Lilly Pulitzer(3) |
$ |
1.1 |
|
$ |
— |
|
|
$ |
1.1 |
|
$ |
— |
|
|
Amortization of Tommy
Bahama Canadian intangible assets(4) |
$ |
0.4 |
|
$ |
0.4 |
|
|
$ |
1.1 |
|
$ |
1.1 |
|
|
Amortization of
Southern Tide intangible assets(5) |
$ |
0.1 |
|
$ |
0.2 |
|
|
$ |
0.2 |
|
$ |
0.4 |
|
|
Amortization of Lilly
Pulitzer Signature Store intangible assets (6) |
$ |
0.1 |
|
$ |
— |
|
|
$ |
0.1 |
|
$ |
— |
|
|
Transaction expenses
associated with Southern Tide acquisition included in Corporate and
Other(7) |
$ |
— |
|
$ |
— |
|
|
$ |
— |
|
$ |
0.8 |
|
|
Transaction expenses
associated with Lilly Pulitzer Signature Store acquisitions
included in Lilly Pulitzer(8) |
$ |
0.6 |
|
$ |
— |
|
|
$ |
0.6 |
|
$ |
— |
|
|
Distribution center
integration charges included in Southern Tide(9) |
$ |
— |
|
$ |
— |
|
|
$ |
— |
|
$ |
0.5 |
|
|
Impact of
income taxes(10) |
$ |
(0.9 |
) |
$ |
— |
|
|
$ |
(2.2 |
) |
$ |
(0.5 |
) |
|
Adjustment to net earnings from continuing operations(11) |
$ |
1.8 |
|
$ |
0.5 |
|
|
$ |
4.6 |
|
$ |
2.0 |
|
|
|
|
|
|
|
|
|
|
Third Quarter
Fiscal 2017 |
Third Quarter Fiscal 2016 |
% Change |
First Nine
Months Fiscal
2017 |
First Nine Months Fiscal 2016 |
% Change |
AS
ADJUSTED |
|
|
|
|
|
|
Tommy
Bahama |
|
|
|
|
|
|
Net
sales |
$ |
123.9 |
|
$ |
126.0 |
|
(1.6 |
)% |
$ |
484.0 |
|
$ |
472.8 |
|
2.4 |
% |
Gross
profit |
$ |
74.3 |
|
$ |
73.9 |
|
0.5 |
% |
$ |
289.4 |
|
$ |
280.9 |
|
3.0 |
% |
Gross
margin |
|
60.0 |
% |
|
58.7 |
% |
|
|
59.8 |
% |
|
59.4 |
% |
|
Operating
income (loss) |
$ |
(5.5 |
) |
$ |
(6.8 |
) |
18.9 |
% |
$ |
33.2 |
|
$ |
27.9 |
|
19.1 |
% |
Operating margin |
|
(4.4 |
)% |
|
(5.4 |
)% |
|
|
6.9 |
% |
|
5.9 |
% |
|
Lilly
Pulitzer |
|
|
|
|
|
|
Net
sales |
$ |
59.2 |
|
$ |
52.3 |
|
13.2 |
% |
$ |
192.0 |
|
$ |
186.8 |
|
2.8 |
% |
Gross
profit |
$ |
34.0 |
|
$ |
30.3 |
|
12.3 |
% |
$ |
122.7 |
|
$ |
119.4 |
|
2.8 |
% |
Gross
margin |
|
57.4 |
% |
|
57.8 |
% |
|
|
63.9 |
% |
|
63.9 |
% |
|
Operating income |
$ |
6.7 |
|
$ |
6.2 |
|
7.7 |
% |
$ |
45.4 |
|
$ |
49.6 |
|
(8.6 |
)% |
Operating margin |
|
11.3 |
% |
|
11.9 |
% |
|
|
23.6 |
% |
|
26.6 |
% |
|
Lanier
Apparel |
|
|
|
|
|
|
Net
sales |
$ |
43.1 |
|
$ |
35.1 |
|
22.9 |
% |
$ |
84.3 |
|
$ |
81.2 |
|
3.8 |
% |
Gross
profit |
$ |
13.2 |
|
$ |
9.4 |
|
39.7 |
% |
$ |
26.4 |
|
$ |
23.1 |
|
13.9 |
% |
Gross
margin |
|
30.6 |
% |
|
26.9 |
% |
|
|
31.3 |
% |
|
28.5 |
% |
|
Operating
income |
$ |
5.6 |
|
$ |
3.7 |
|
53.2 |
% |
$ |
6.7 |
|
$ |
6.6 |
|
0.9 |
% |
Operating margin |
|
13.0 |
% |
|
10.5 |
% |
|
|
7.9 |
% |
|
8.1 |
% |
|
Southern
Tide |
|
|
|
|
|
|
Net
sales |
$ |
9.2 |
|
$ |
8.7 |
|
6.1 |
% |
$ |
31.3 |
|
$ |
19.3 |
|
NM |
|
Gross
profit |
$ |
4.9 |
|
$ |
4.2 |
|
16.6 |
% |
$ |
15.8 |
|
$ |
9.7 |
|
NM |
|
Gross
margin |
|
53.0 |
% |
|
48.2 |
% |
|
|
50.7 |
% |
|
50.1 |
% |
|
|
Operating
income |
$ |
1.1 |
|
|
0.7 |
|
60.5 |
% |
$ |
4.0 |
|
|
2.5 |
|
NM |
|
Operating margin |
|
11.8 |
% |
|
7.8 |
% |
|
|
12.7 |
% |
|
13.1 |
% |
|
|
Corporate and
Other |
|
|
|
|
|
|
|
Net
sales |
$ |
0.5 |
|
$ |
0.3 |
|
NM |
|
$ |
1.4 |
|
$ |
1.5 |
|
NM |
|
Gross
profit |
$ |
0.4 |
|
$ |
0.2 |
|
NM |
|
$ |
1.0 |
|
$ |
1.1 |
|
NM |
|
Operating loss |
$ |
(4.1 |
) |
$ |
(3.6 |
) |
(13.4 |
)% |
$ |
(14.9 |
) |
$ |
(13.7 |
) |
(8.5 |
)% |
Consolidated |
|
|
|
|
|
|
Net
sales |
$ |
236.0 |
|
$ |
222.3 |
|
6.1 |
% |
$ |
793.0 |
|
$ |
761.5 |
|
4.1 |
% |
Gross
profit |
$ |
126.7 |
|
$ |
118.0 |
|
7.4 |
% |
$ |
455.4 |
|
$ |
434.2 |
|
4.9 |
% |
Gross
margin |
|
53.7 |
% |
|
53.1 |
% |
|
|
57.4 |
% |
|
57.0 |
% |
|
SG&A |
$ |
126.0 |
|
$ |
120.9 |
|
4.2 |
% |
$ |
391.2 |
|
$ |
371.7 |
|
5.3 |
% |
SG&A
as % of net sales |
|
53.4 |
% |
|
54.4 |
% |
|
|
49.3 |
% |
|
48.8 |
% |
|
Operating
income |
$ |
3.8 |
|
$ |
0.2 |
|
NM |
|
$ |
74.3 |
|
$ |
72.9 |
|
1.9 |
% |
Operating
margin |
|
1.6 |
% |
|
0.1 |
% |
|
|
|
9.4 |
% |
|
9.6 |
% |
|
Earnings
(loss) from continuing operations before income taxes |
$ |
3.1 |
|
$ |
(0.5 |
) |
NM |
|
$ |
72.0 |
|
$ |
70.4 |
|
2.2 |
% |
Net
earnings (loss) from continuing operations |
$ |
2.9 |
|
$ |
(1.1 |
) |
NM |
|
$ |
45.6 |
|
$ |
44.5 |
|
2.6 |
% |
Net earnings (loss) from continuing operations per diluted
share |
$ |
0.17 |
|
$ |
(0.07 |
) |
NM |
|
$ |
2.73 |
|
$ |
2.67 |
|
2.2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Third Quarter Fiscal 2017 |
Third Quarter Fiscal 2017 |
Third Quarter Fiscal 2016 |
First Nine Months Fiscal 2017 |
First Nine Months Fiscal 2016 |
|
|
Actual |
Guidance(12) |
Actual |
Actual |
Actual |
|
Net earnings (loss)
from continuing operations per diluted share: |
|
|
|
|
|
GAAP basis |
$0.06 |
$0.04
- $0.14 |
$(0.10) |
$2.45 |
$2.55 |
|
LIFO
adjustments(13) |
0.02 |
0.00 |
(0.04) |
0.14 |
(0.08) |
|
Inventory step-up
charges(14) |
0.04 |
0.00 |
0.04 |
0.04 |
0.08 |
|
Amortization of
recently acquired intangible assets(15) |
0.03 |
0.03 |
0.03 |
0.08 |
0.08 |
|
Transaction expenses
and integration costs for recent acquisitions(16) |
0.02 |
0.02 |
0.00 |
0.02 |
0.05 |
|
As
adjusted(11) |
$0.17 |
$0.09 - $0.19 |
$(0.07) |
$2.73 |
$2.67 |
|
|
|
|
|
|
|
|
|
Fourth Quarter Fiscal 2017 |
Fourth Quarter Fiscal 2016 |
Fiscal 2017 |
Fiscal 2016 |
|
|
|
Guidance(17) |
Actual |
Guidance(17) |
Actual |
|
|
Net earnings (loss)
from continuing operations per diluted share: |
|
|
|
|
|
|
GAAP basis |
$0.77
- $0.92 |
$0.72 |
$3.23
- 3.38 |
$3.27 |
|
|
LIFO
adjustments(13) |
0.00 |
(0.13) |
0.14 |
(0.22) |
|
|
Inventory step-up
charges(14) |
0.00 |
0.02 |
0.04 |
0.10 |
|
|
Amortization of
recently acquired intangible assets(15) |
0.03 |
0.02 |
0.11 |
0.10 |
|
|
Transaction expenses
and integration costs for recent acquisitions(16) |
0.02 |
0.00 |
0.04 |
0.04 |
|
|
As adjusted(11) |
$0.82 - $0.97 |
$0.63 |
$3.55 - $3.70 |
$3.30 |
|
|
|
|
|
|
|
|
|
(1) LIFO
adjustments included in Corporate and Other represent the impact on
cost of goods sold resulting from LIFO accounting adjustments. |
(2)
Inventory step-up charges included in Southern Tide represent the
impact of purchase accounting adjustments resulting from the
step-up of inventory at acquisition of the Southern Tide business.
These charges are included in cost of goods sold in Southern
Tide. |
(3)
Inventory step-up charges included in Lilly Pulitzer represent the
impact of purchase accounting adjustments resulting from the
step-up of inventory at acquisition related to Lilly Pulitzer's
acquisition of certain Lilly Pulitzer Signature Stores. These
charges are included in cost of goods sold in Lilly Pulitzer. |
(4)
Amortization of Tommy Bahama 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. |
(5)
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. |
(6)
Amortization of Lilly Pulitzer Signature Store intangible assets
represents the amortization related to the intangible assets
acquired as part of Lilly Pulitzer's acquisition of certain Lilly
Pulitzer Signature Stores. Amortization of Lilly Pulitzer
intangible assets are included in SG&A in Lilly Pulitzer. |
(7)
Transaction expenses associated with Southern Tide acquisition
included in Corporate and Other represents the transaction costs
associated with the Southern Tide acquisition. These expenses are
included in SG&A in Corporate and Other. |
(8)
Transaction expenses associated with Lilly Pulitzer Signature Store
acquisitions included in Lilly Pulitzer represents the transaction
costs associated with Lilly Pulitzer's acquisition of certain Lilly
Pulitzer Signature Stores. These transaction expenses for
acquisition are included in SG&A in Lilly Pulitzer. |
(9)
Distribution center integration charges included in Southern Tide
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. |
(10) 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. |
(11)
Amounts in columns may not add due to rounding. |
(12)
Guidance as issued on August 31, 2017. |
(13) 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. |
(14)
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 in Fiscal 2016 and Lilly Pulitzer's acquisition of
certain Signature Stores in Fiscal 2017. |
(15)
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. |
(16)
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. |
(17)
Guidance as issued on December 5, 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 |
% |
5 |
% |
— |
% |
— |
% |
|
Fiscal
2016 |
(13 |
)% |
7 |
% |
(6 |
)% |
(3 |
)% |
(3 |
)% |
|
Fiscal
2015 |
8 |
% |
3 |
% |
(5 |
)% |
2 |
% |
3 |
% |
|
Lilly
Pulitzer |
|
|
|
|
|
|
Fiscal
2017 |
(7 |
)% |
(6 |
)% |
(1 |
)% |
— |
% |
— |
% |
|
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 |
111 |
— |
|
Retail-restaurant |
17 |
17 |
17 |
18 |
— |
|
Outlet |
40 |
40 |
39 |
38 |
— |
|
Total |
168 |
169 |
167 |
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 |
57 |
— |
|
Fiscal 2016 |
|
|
|
|
|
|
Full-price |
34 |
34 |
37 |
39 |
40 |
|
|
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