US' Oxford Industries' consolidated net sales climb 16% in Q2 FY23

Full-price direct-to-consumer (DTC) sales increased by 13 per cent to $286 million versus Q2 of fiscal 2022. This includes $41 million of DTC sales in Johnny Was and a 3 per cent aggregate decrease in full-price DTC sales in the company’s other businesses.

Full-price retail sales were $150 million, an increase of 11 per cent or $15 million, compared to the same quarter of the previous fiscal. This includes full-price retail sales in Johnny Was of $18 million for Q2 of fiscal 2023. Full-price retail sales in the company’s other businesses decreased by 3 per cent.

Full-price e-commerce sales grew by 15 per cent, or $17 million, to $136 million versus Q2 of the previous fiscal. This includes full-price e-commerce sales in Johnny Was of $22 million. Full-price e-commerce sales in the company’s other businesses declined by 4 per cent.

Gross margin was 63.9 per cent on a GAAP basis. Adjusted gross margin was 64.3 per cent, compared to 64.6 per cent on an adjusted basis in Q2 of fiscal 2022. Second quarter gross margin reflects increased e-commerce flash sales at Lilly Pulitzer and a greater proportion of sales during loyalty award cards, flipside and end-of-season clearance events at Tommy Bahama. These were partially offset by the higher gross margin of Johnny Was and reduced freight expense, the company said in a press release.

SG&A for Q2 was $205 million, compared to $163 million in Q2 of the previous fiscal, increasing primarily due to $32 million of Johnny Was SG&A. This includes $3 million of amortisation of intangible assets. Across all operating groups, SG&A increased due to rises in employment costs, advertising costs, variable expenses, occupancy costs and other expenses to support sales growth. On an adjusted basis, SG&A for Q2 was $202 million, compared to $163 million in Q2 of the previous fiscal.

“We are pleased to have delivered second quarter results that are up significantly on a multi-year basis and within our forecasted range given the choppy operating environment. Our solid top-line performance was achieved through winning execution within our six brands, each of which saw sales growth this quarter driven by strong emotional connections to consumers, inspiring brand voices, and balanced omni-channel distribution delivering exceptional products to our customers. While these factors remain strong across our business, we have recently seen consumers become a bit more cautious with their discretionary spending due to challenging macroeconomic conditions. We are also feeling the impacts of wildfires on Maui due to Oxford’s significant presence on the island. In consideration of these factors, we are moderating our outlook for the second half of the year,” Tom Chubb, chairman and CEO, said.

“Despite some near-term pressures, we are confident that our business model will drive profitable growth and long-term shareholder value well into the future. I am proud of, and grateful for, the generosity of our associates across the enterprise that have pitched in so many ways to help the people of Maui recover from this disaster. This generosity and the resilience of our people in Maui and Hawaii are among the characteristics that make Oxford such a great company,” Chubb concluded.

For fiscal 2023 ending on February 3, 2024, the company moderated its sales and EPS guidance. The company now expects net sales to be in a range of $1.570 billion to $1.600 billion, as compared to net sales of $1.41 billion in fiscal 2022. In fiscal 2023, GAAP EPS is expected to be between $9.61 and $9.91, compared to fiscal 2022 GAAP EPS of $10.19. Adjusted EPS is expected to be between $10.30 and $10.60, compared to fiscal 2022 adjusted EPS of $10.88.

For the third quarter of fiscal 2023, the company expects net sales to be between $320 million and $335 million, compared to net sales of $313 million in Q3 of fiscal 2022. The expected range for GAAP EPS is between $0.74 and $0.94, compared to GAAP EPS of $1.22 in Q3 of fiscal 2022. Adjusted EPS is expected to be between $0.90 and $1.10, compared to adjusted EPS of $1.46 in Q3 of fiscal 2022.

Fibre2Fashion News Desk (RR)