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Promotional Climate Impacts Oxford Industries’ Business in Q2

Jean E. Palmieri
·2 min read

The promotional environment took a bite out of business at Oxford Industries in the second quarter, leading the owner of Tommy Bahama, Lilly Pulitzer and Johnny Was to lower its guidance for fiscal 2024.

The Atlanta-based company reported Wednesday afternoon that earnings per share fell to $2.77 from $3.45 in the second quarter of fiscal 2023. Sales were essentially flat at $419.9 million in the quarter compared with $420.3 million in the prior-year period. Operating income dropped to $53 million from $68 million the prior year.

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“Consumer sentiment in the second quarter continued to decline from levels earlier in the year reaching an eight-month low in July,” said Tom Chubb, chairman and chief executive officer of Oxford. “The decline led to market conditions that were weaker than expected with more consumers looking for deals and promotions, as evidenced by increased sales in our outlet locations and during promotional events.”

As a result, the company updated its sales and earnings per share guidance. Oxford now expects net sales in the range of $1.51 billion to $1.54 billion as compared to $1.57 billion in fiscal 2023. Adjusted EPS is now expected to be between $7 and $7.30, compared to an adjusted EPS of $10.15 in fiscal 2023.

Third-quarter results are also expected to be impacted, the company said. Oxford now expects net sales to be between $310 million and $325 million compared to $327 million in the third quarter of fiscal 2023. Adjusted EPS is expected to be between zero and 20 compared to adjusted EPS of $1.01 in the third quarter of fiscal 2023.

By division, sales at Tommy Bahama in the quarter were $245.1 million, flat to the $254.4 million in the second quarter of last year. Lilly Pulitzer’s sales inched up 0.4 percent to $91.7 million from 91.3 million, Johnny Was dropped 3.4 percent to 50.3 million from $52 million, while the emerging brands division — Southern Tide, Duck Head and others — rose 4.3 percent to $32.9 million from $31.6 million in the prior year.

Chubb said the challenging environment is causing the company to search for ways to reduce SG&A while “avoiding short-sighted reactions to current market conditions” and protecting its brands.

After closing at $83.66 on Wednesday, Oxford’s stock was down more than 9 percent in after-hours trading.

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