Oxford Industries Profit Rises; Shares Down On Weak Outlook

(RTTNews) - Apparels company Oxford Industries, Inc. (OXM), Tuesday said its profit for the second quarter improved from a year ago, due mainly to an increase in revenues driven by growth at its Tommy Bahama and Lily Pulitzer brands. Earnings for the quarter came in ahead of expectations, while revenues fell short of expectations.

Looking ahead, the company detailed a weak third quarter and full year outlook, dragging down Oxford shares by over 7 percent in after-hours trade on the New York Stock Exchange.

Oxford Industries reported second quarter earnings of $15.8 million or $0.96 per share, up from $5.0 million or $0.30 per share in the year-ago quarter.

On an adjusted basis, earnings rose to $16.5 million from $10.8 million last year. On a per share basis, earnings grew 55 percent to $1.01 from $0.65 in the prior-year quarter. On average, seven analysts polled by Thomson Reuters expected earnings of $0.98 per share for the quarter. Analysts estimates typically exclude one-time items.

Consolidated net sales for the second quarter increased 14% to $235.0 million compared to $206.9 million in the year-ago quarter. Four analysts had a consensus revenue estimate of $243.48 million for the quarter.

Tommy Bahama net sales jumped 20 percent to $153.2 million, with a comparable store sales increase of 13 percent. Lilly Pulitzer net sales rose 24 percent to $38.2 million, with a comparable store sales increase of 19 percent.

Oxford Industries gross margin for the second quarter improved 100 basis points to 58.2 percent, due mainly to Tommy Bahama and Lilly Pulitzer businesses and the continued shift in sales mix towards direct to consumer sales.

For the full year, the company slashed its full year guidance, and now anticipate earnings in a range of $2.80 to $2.95 per share and adjusted earnings in a range of $2.90 to $3.05 per share. Analysts currently expect earnings of $3.12 per share for the year.

Full year net sales are projected in a range of $920 million to $930 million, with analysts expecting $1.03 billion.

Looking to the third quarter, the company in a statement said, "Because of the impact of seasonality on the Company's business, sales and earnings in the third quarter are typically significantly lower than other quarters."

Oxford Industries anticipate third-quarter earnings in the range of $0.04 to $0.09 per share, with adjusted earnings in the range of $0.08 to $0.13 per share. Analysts currently expect earnings of $0.21 per share for the quarter.

Net sales for the third quarter are anticipated in the range of $195 million to $205 million, with analysts expecting sales of $199.88 million.

For the fourth quarter, company expects earnings in the range of $0.98 to $1.08 per share, with adjusted earnings of $0.99 to $1.09 per share. Net sales for the fourth quarter are anticipated in a range of $250 to $260 million.

OXM closed tuesday's regular trade at $64.72 per share, up $0.86 or 1.35%, on a volume of 0.17 million shares on the NYSE. In after hours, the stock lost $4.72 or 7.29%, to trade at $60.00.