Oxford Industries' net sales up 6 percent, earnings drop

For the full 2016 fiscal year, consolidated net sales at Oxford Industries increased 6 percent to 1.023 billion dollars and earnings per share from continuing operations on a GAAP basis were 3.27dollars compared to 3.54 dollars in the prior year. Adjusted earnings from continuing operations were 3.30 dollars per share compared to 3.64 dollars per share in fiscal 2015.

Commenting on the company’s performance, Thomas C. Chubb III, Chairman and CEO, said in a statement, "Our portfolio of businesses has attributes that are true competitive advantages in the new retailing paradigm. As we go forward in fiscal 2017, we are laser-focused on the initiatives to improve the operating performance at Tommy Bahama. This includes revamping the outlet and clearance strategy, improving gross margin by making selective price increases and reducing input costs, and controlling operating expenses.''

Q4 and FY16 operating results

In the fourth quarter, consolidated net sales at Oxford Industries increased to 261 million dollars compared to 259.6 million dollars in the fourth quarter of fiscal 2015. Earnings from continuing operations on a GAAP basis were 0.72 dollar per share compared to 1.06 dollars in the same period of the prior year. Adjusted earnings were 0.63 dollar per share compared to 1.09 dollars in the fourth quarter of fiscal 2015.

Lilly Pulitzer's fourth quarter sales, which included a significantly larger e-commerce flash sale event than in the prior year, increased 26 percent. Southern Tide contributed $8.2 million of sales in the quarter, with offsets to these increases in both Tommy Bahama and Lanier Apparel.

Gross profit in the fourth quarter increased to 146.7 million dollars compared to 144.7 million dollars in the same period of the prior year. Gross margin was 42 basis points higher at 56.2 percent. Gross profit for the full year was 582.8 million dollars compared to 558.1 million dollars in the prior year, with a reduction in gross margin of 59 basis points to 57 percent.

Operating income in the fourth quarter was 19.5 million dollars compared to 28.5 million dollars in the same period of the prior year. On an adjusted basis, operating income was 16.7 million dollars compared to 29.1 million dollars. For the full 2016 fiscal year, operating income was 89.9 million dollars compared to 97.5 million dollars in fiscal 2015. On an adjusted basis, operating income was 89.6 million dollars compared to 99.3 million dollars.

Outlook for the full year and first quarter

The company said, fiscal 2017 earnings per share are expected to be negatively impacted by a higher effective tax rate. For the full 2017 fiscal year, a 53-week year which ends on February 3, 2018, the company currently expects net sales to grow to between 1.08 billion dollars to 1.10 billion dollars as compared to fiscal 2016 net sales of 1.023 billion dollars. GAAP earnings per share from continuing operations are expected to be between 3.41 dollars and 3.61 dollars, while adjusted earnings are expected to be between 3.50 dollars and 3.70 dollars.

For the first quarter of fiscal 2017, ending April 29, 2017, the company currently expects net sales to grow to between 270 million dollars to 280 million dollars, as compared to 256.2 million dollars in the first quarter of fiscal 2016. GAAP earnings per share from continuing operations are expected to be between 0.98 dollar and 1.08 dollars and adjusted earnings are expected to be between 1 dollar and 1.10 dollars.

The company also announced that its board of directors has approved a cash dividend of 0.27 dollar per share payable on April 28, 2017 to shareholders of record as of the close of business on April 13, 2017. The company has paid dividends every quarter since it became publicly owned in 1960.

Picture:Tommy Bahama website