Oxford Industries, Inc. Press Release
222 Piedmont Avenue, N.E. •
Atlanta, Georgia 30308
CONTACT:
J. Reese Lanier, Jr.
Telephone: (404) 653-1446
Fax: (404) 653-1545
E-mail: rlanier@oxfordinc.com
FOR IMMEDIATE RELEASE — September 23, 2002
OXFORD INDUSTRIES ANNOUNCES FIRST QUARTER FINANCIAL RESULTS
ATLANTA, GA. — Oxford Industries, Inc. (NYSE:OXM) announced today financial results for the first quarter ended August 30, 2002. Consolidated net sales declined 4.1% to $172.1 million from $179.5 million last year. First quarter net earnings increased 44.2% to $4.5 million from $3.1 million last year. Diluted earnings per share increased 42.9% to $0.60 from $0.42.
“We are gratified to see the dramatic improvement in our profitability in the first quarter,“ commented J. Hicks Lanier, Chairman and President. “Our efforts to aggressively manage inventory and improve sourcing have been key to our improving financial results. Significantly lower inventories have resulted in reduced markdowns. Better sourcing and more efficient manufacturing have led to a 210 basis point increase in our first quarter gross margins.“
The sales decline was driven primarily by the discontinuation of the DKNY® Kids business and was in line with the company’s expectations. Gross margins improved 210 basis points to 22.3% from 20.2% last year. Operating expenses declined slightly from last year.
Total inventories declined 30% from last year with substantially all of the reduction coming in the finished goods inventory. Total funded debt inclusive of outstanding debt under the trade receivables securitization program declined to $2.9 million from $53.6 million last year.
SEGMENT HIGHLIGHTS
Oxford Slacks reported a 3% sales decline to $21.4 million from $22.0 million
last year. Sales gains in the specialty catalog channel were offset by sales
declines to chain stores. Profitability increased significantly due primarily to
improved manufacturing and sourcing performance. Operating earnings increased
23% over last year to $1.3 million.
Oxford Womenswear Group posted first quarter sales of $66.6 million, a 7% increase over last year. Growth at the group's mass merchant customers was responsible for most of the sales increase. Operating earnings declined 12% from last year to $3.5 million due to gross margin pressures.
First quarter sales for the Oxford Shirt Group declined 13% to $47.2 million from $54.5 million. A majority of the sales decline was attributable to the exit of the DKNY® Kids business and the balance was due to lower planned sales in the group's sportshirt division. Operating earnings declined 12%, slightly less than the sales decline.
Lanier Clothes, the company's tailored clothing group, reported a 9% sales decline from last year to $36.9 million. The sales decline was driven by lower demand from the department store channel. Despite the sales decline, operating earnings increased 11% over last year to $4.9 million driven by lower markdowns and improved manufacturing performance.
CONCLUSION
"While the business climate remains quite challenging, we are increasingly
optimistic about our financial performance going forward," concluded
Lanier. “Comparatively lower wholesale and retail inventories should provide
us with the opportunity to replenish a somewhat depleted supply chain. The
rollout of selected Lands' End apparel products to Sears stores this fall and
next spring should have a favorable impact on our sales. Order bookings and
backlog were strongly positive at quarter-end. With respect to profitability,
sourcing and manufacturing initiatives implemented last year should continue to
drive improvements in gross margin."
For the second quarter, the company expects a material improvement in sales and earnings compared to last year’s depressed levels. For the full year, the company expects a significant rebound in earnings on a moderate sales increase.
Oxford Industries, Inc. is a diversified
international manufacturer and wholesale marketer of branded and private label
apparel for men, women and children. With manufacturing and sourcing operations
in over 40 countries around the globe, Oxford provides retailers and consumers
with a wide variety of apparel products and services to suit their individual
needs. Major licensed brands include Tommy Hilfiger®, Nautica®, Geoffrey Beene®,
Slates®, Oscar de la Renta® and Izod Club®. Oxford's private label customers
are found in every major channel of distribution, including national chains,
specialty catalogs, mass merchandisers, department stores, specialty stores and
Internet retailers. The Company's stock has traded on the NYSE since 1964 under
the symbol OXM. Please visit our Web site at www.oxfordinc.com.
Safe Harbor Statement Under the Private
Securities Litigation Reform Act of 1995
This document contains forward-looking statements of the Company's beliefs or
expectations regarding anticipated future results of the Company. These
statements are based on numerous assumptions and are subject to risks and
uncertainties. Although the Company feels that the beliefs and expectations in
the forward-looking statements are reasonable, it does not and cannot give any
assurance that the beliefs and expectations will prove to be correct. Many
factors could significantly affect the Company's operations and cause the
Company's actual results to be substantially different from the Company's
expectations. Those factors include, but are not limited to: (i) general
economic and apparel business conditions; (ii) continued retailer and consumer
acceptance of the Company's products; (iii) global manufacturing costs; (iv) the
financial condition of customers or suppliers; (v) changes in capital market
conditions; (vi) governmental and business conditions in countries where the
Company's products are manufactured; (vii) changes in trade regulations; (viii)
the impact of acquisition activity; (ix) changes in the Company's plans,
strategies, objectives, expectations or intentions, which may happen at any time
in the discretion of the Company; and (x) other risks and uncertainties
indicated from time to time in the Company's filings with the Securities and
Exchange Commission. The Company does not have an obligation to publicly update
any forward-looking statements, whether as a result of the receipt of new
information, the occurrence of future events or otherwise.
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OXFORD INDUSTRIES, INC. |
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| Quarter Ended | ||||
| $ in thousands, except per share amounts |
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Aug. 30, 2002
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Aug. 31, 2001
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| Net Sales | $172,139 | $179,530 | ||
| Cost of Goods Sold | 133,677 | 143,210 | ||
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| Gross Profit | 38,462 | 36,320 | ||
| Selling, General and Administrative | 30,968 | 31,203 | ||
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| Earnings Before Interest and Taxes | 7,494 | 5,117 | ||
| Interest | 41 | 73 | ||
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| Earnings Before Income Taxes | 7,453 | 5,044 | ||
| Income Taxes | 2,943 | 1,917 | ||
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| Net Earnings | $ 4,510 | $ 3,127 | ||
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| Basic Earnings Per Common Share | $ 0.60 | $ 0.42 | ||
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| Diluted Earnings Per Common Share | $ 0.60 | $ 0.42 | ||
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| Basic Number of Shares Outstanding | 7,515,577 | 7,439,168 | ||
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| Diluted Number of Shares Outstanding | 7,560,674 | 7,487,273 | ||
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| Dividends Per Share | $ 0.21 | $ 0.21 | ||
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OXFORD INDUSTRIES, INC. |
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| $ in thousands |
Aug. 30, 2002
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Aug. 31, 2001
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| Assets | ||
| Current Assets: | ||
| Cash | $ 6,253 | $ 6,330 |
| Receivables | 121,011 | 59,387 |
| Inventories: | ||
| Finished goods | 57,458 | 91,748 |
| Work in process | 13,459 | 16,484 |
| Fabric, trim and supplies | 19,103 | 19,483 |
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| Total Inventories | 90,020 | 127,715 |
| Prepaid expenses | 10,133 | 11,450 |
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| Total Current Assets | 227,417 | 204,882 |
| Property, Plant and Equipment | 26,079 | 32,151 |
| Deferred Income Taxes | — | 256 |
| Other Assets | 8,216 | 9,468 |
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| Total Assets | $261,712 | $246,757 |
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| Liabilities and Stockholders' Equity | ||
| Current Liabilities: | ||
| Notes payable | $ 2,500 | $ — |
| Trade accounts payable | 45,666 | 35,928 |
| Accrued compensation | 10,734 | 9,730 |
| Other accrued expenses | 14,860 | 20,541 |
| Dividends payable | 1,578 | 1,571 |
| Income taxes | 2,924 | 1,570 |
| Current maturities of long-term debt | 236 | 245 |
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| Total Current Liabilities | 78,498 | 69,585 |
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| Long-Term Debt, less current maturities | 139 | 399 |
| Noncurrent Liabilities | 4,500 | 4,500 |
| Deferred Income Taxes | 423 | — |
| Stockholders' Equity: | ||
| Common stock | 7,516 | 7,504 |
| Additional paid-in capital | 14,633 | 14,386 |
| Retained earnings | 156,003 | 150,383 |
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| Total Stockholders' Equity | 178,152 | 172,273 |
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| Total Liabilities and Stockholders' Equity | $261,712 | $246,757 |
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OXFORD INDUSTRIES, INC. |
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| $ in thousands | First Quarter | |||
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Aug. 30, 2002
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Aug. 31, 2001
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| Net Sales | ||||
| Oxford Shirt Group | $ 47,173 | $ 54,469 | ||
| Lanier Clothes | 36,940 | 40,711 | ||
| Oxford Slacks | 21,354 | 22,002 | ||
| Oxford Womenswear | 66,599 | 62,227 | ||
| Corporate and Other | 73 | 121 | ||
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| Net Sales | $172,139 | $179,530 | ||
| Earnings Before Interest and Taxes | ||||
| Oxford Shirt Group | $ 1,254 | $ 1,427 | ||
| Lanier Clothes | 4,896 | 4,407 | ||
| Oxford Slacks | 1,349 | 1,095 | ||
| Oxford Womenswear | 3,541 | 4,036 | ||
| Corporate and Other | (3,546) | (5,848) | ||
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| Total | 7,494 | 5,117 | ||
| Interest expense, net | 41 | 73 | ||
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| Earnings Before Interest and Taxes | $ 7,453 | $ 5,044 | ||