Table of Contents

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

 

FORM 10-Q

 

þ                                                          QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended MAY 1, 2010

 

or

 

o                                                          TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from                 to                 

 

Commission File Number: 1-4365

 

OXFORD INDUSTRIES, INC.

(Exact name of registrant as specified in its charter)

 

Georgia

 

58-0831862

(State or other jurisdiction of incorporation or organization)

 

(I.R.S. Employer Identification No.)

 

 

222 Piedmont Avenue, N.E., Atlanta, Georgia  30308

 

 

(Address of principal executive offices)     (Zip Code)

 

 

 

 

 

                              (404) 659-2424                              

 

 

(Registrant’s telephone number, including area code)

 

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No ¨

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ¨ No ¨

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer £

 

Accelerated filer þ

 

Non-accelerated filer £

 

Smaller reporting company £

 

 

(Do not check if a smaller reporting company)

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No þ

 

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

 

 

 

Number of shares outstanding

Title of each class

 

as of June 4, 2010

Common Stock, $1 par value

 

16,525,517

 

 

 



 

OXFORD INDUSTRIES, INC.

INDEX TO FORM 10-Q

For the first quarter of fiscal 2010

 

 

Page

PART I. FINANCIAL INFORMATION

 

 

 

Item 1. Financial Statements

 

Condensed Consolidated Statements of Operations (Unaudited)

4

Condensed Consolidated Balance Sheets (Unaudited)

5

Condensed Consolidated Statements of Cash Flows (Unaudited)

6

Notes to Unaudited Condensed Consolidated Financial Statements

7

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

13

Item 3. Quantitative and Qualitative Disclosures About Market Risk

22

Item 4. Controls and Procedures

22

 

 

PART II. OTHER INFORMATION

 

 

 

Item 1. Legal Proceedings

23

Item 1A. Risk Factors

23

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

23

Item 3. Defaults Upon Senior Securities

23

Item 4. Reserved

23

Item 5. Other Information

23

Item 6. Exhibits

24

Signatures

24

 

2



Table of Contents

 

CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING STATEMENTS

 

Our SEC filings and public announcements may include forward-looking statements about future events. Generally, the words “believe,” “expect,” “intend,” “estimate,” “anticipate,” “project,” “will” and similar expressions identify forward-looking statements, which generally are not historical in nature. We intend for all forward-looking statements contained herein, in our press releases or on our website, and all subsequent written and oral forward-looking statements attributable to us or persons acting on our behalf, to be covered by the safe harbor provisions for forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and the provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 (which Sections were adopted as part of the Private Securities Litigation Reform Act of 1995). Important assumptions relating to these forward-looking statements include, among others, assumptions regarding the impact of economic conditions on consumer demand and spending, the impact of natural or man-made disasters in any of the regions in which our retail stores or wholesale customers are concentrated, demand for our products, timing of shipments requested by our wholesale customers, expected pricing levels, competitive conditions, the timing and cost of planned capital expenditures, costs of products and raw materials we purchase, access to capital and/or credit markets, expected outcomes of pending or potential litigation and regulatory actions and disciplined execution by key management. Forward-looking statements reflect our current expectations, based on currently available information, and are not guarantees of performance. Although we believe that the expectations reflected in such forward-looking statements are reasonable, these expectations could prove inaccurate as such statements involve risks and uncertainties, many of which are beyond our ability to control or predict. Should one or more of these risks or uncertainties, or other risks or uncertainties not currently known to us or that we currently deem to be immaterial, materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated or projected. Important factors relating to these risks and uncertainties include, but are not limited to, those described Part I, Item 1A. Risk Factors contained in our Annual Report on Form 10-K for fiscal 2009, as updated by Part II, Item 1A. Risk Factors in this report and those described from time to time in our future reports filed with the SEC.

 

We caution that one should not place undue reliance on forward-looking statements, which speak only as of the date on which they are made. We disclaim any intention, obligation or duty to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

 

DEFINITIONS

 

Unless the context requires otherwise, the following terms, or words of similar import, have the following meanings:

 

Our, us or we: Oxford Industries, Inc. and its consolidated subsidiaries

 

SG&A: Selling, general and administrative expenses

 

SEC: U.S. Securities and Exchange Commission

 

Securities Exchange Act: the Securities Exchange Act of 1934, as amended

 

FASB: Financial Accounting Standards Board

 

U.S. GAAP: Generally accepted accounting principles in the United States

 

ASC: FASB Accounting Standards Codification

 

Fiscal 2011

52 weeks ending January 28, 2012

Fiscal 2010

52 weeks ending January 29, 2011

Fiscal 2009

52 weeks ended January 30, 2010

Fourth quarter fiscal 2010

13 weeks ending January 29, 2011

Third quarter fiscal 2010

13 weeks ending October 30, 2010

Second quarter fiscal 2010

13 weeks ending July 31, 2010

First quarter fiscal 2010

13 weeks ended May 1, 2010

Fourth quarter fiscal 2009

13 weeks ended January 30, 2010

Third quarter fiscal 2009

13 weeks ended October 31, 2009

Second quarter fiscal 2009

13 weeks ended August 1, 2009

First quarter fiscal 2009

13 weeks ended May 2, 2009

 

3



Table of Contents

 

PART I.  FINANCIAL INFORMATION

 

ITEM 1. FINANCIAL STATEMENTS

 

OXFORD INDUSTRIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)

(in thousands, except per share amounts)

 

 

 

First Quarter
Fiscal 2010

 

First Quarter
Fiscal 2009

Net sales

 

$217,750

 

$216,731

Cost of goods sold

 

116,168

 

126,797

Gross profit

 

101,582

 

89,934

SG&A

 

83,752

 

78,683

Amortization of intangible assets

 

250

 

308

 

 

84,002

 

78,991

Royalties and other operating income

 

3,841

 

2,469

Operating income

 

21,421

 

13,412

Interest expense, net

 

5,009

 

4,565

Earnings before income taxes

 

16,412

 

8,847

Income taxes

 

3,915

 

2,236

Net earnings

 

$  12,497

 

$    6,611

 

 

 

 

 

Net earnings per common share:

 

 

 

 

Basic

 

$      0.76

 

$      0.42

Diluted

 

$      0.76

 

$      0.42

Weighted average common shares outstanding:

 

 

 

 

Basic

 

16,490

 

15,876

Dilution

 

13

 

Diluted

 

16,503

 

15,876

 

 

 

 

 

Dividends declared per common share

 

$      0.11

 

$      0.09

 

See accompanying notes.

 

4



Table of Contents

 

OXFORD INDUSTRIES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

(in thousands, except par amounts)

 

 

 

May 1,
2010

 

January 30,
2010

 

May 2,
2009

 

ASSETS

 

 

 

 

 

 

 

 

 

 

Current Assets:

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$  18,823

 

 

$    8,288

 

 

$    8,386

 

 

Receivables, net

 

94,481

 

 

74,398

 

 

93,795

 

 

Inventories, net

 

56,319

 

 

77,029

 

 

93,875

 

 

Prepaid expenses, net

 

12,286

 

 

10,713

 

 

11,629

 

 

Deferred tax assets

 

15,397

 

 

13,875

 

 

9,863

 

 

Total current assets

 

197,306

 

 

184,303

 

 

217,548

 

 

Property, plant and equipment, net

 

76,474

 

 

79,540

 

 

88,311

 

 

Intangible assets, net

 

136,033

 

 

137,490

 

 

136,454

 

 

Other non-current assets, net

 

23,821

 

 

23,841

 

 

19,970

 

 

Total Assets

 

$433,634

 

 

$425,174

 

 

$462,283

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

 

 

Current Liabilities:

 

 

 

 

 

 

 

 

 

 

Trade accounts payable and other accrued expenses

 

$  69,254

 

 

$  81,831

 

 

$  70,685

 

 

Accrued compensation

 

17,810

 

 

11,514

 

 

9,907

 

 

Income taxes payable

 

6,023

 

 

2,517

 

 

2,414

 

 

Short-term debt and current maturities of long-term debt

 

2,856

 

 

 

 

25,479

 

 

Total current liabilities

 

95,943

 

 

95,862

 

 

108,485

 

 

Long-term debt, less current maturities

 

146,572

 

 

146,408

 

 

181,501

 

 

Other non-current liabilities

 

48,401

 

 

50,066

 

 

46,304

 

 

Non-current deferred income taxes

 

28,192

 

 

28,421

 

 

31,423

 

 

Commitments and contingencies

 

 

 

 

 

 

 

 

 

 

Shareholders’ Equity:

 

 

 

 

 

 

 

 

 

 

Common stock, $1.00 par value per common share

 

16,526

 

 

16,461

 

 

16,057

 

 

Additional paid-in capital

 

93,131

 

 

91,840

 

 

89,040

 

 

Retained earnings

 

30,036

 

 

19,356

 

 

15,805

 

 

Accumulated other comprehensive loss

 

(25,167

)

 

(23,240

)

 

(26,332

)

 

Total shareholders’ equity

 

114,526

 

 

104,417

 

 

94,570

 

 

Total Liabilities and Shareholders’ Equity

 

$433,634

 

 

$425,174

 

 

$462,283

 

 

 

See accompanying notes.

 

5



Table of Contents

 

OXFORD INDUSTRIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

(in thousands)

 

 

 

First Quarter
Fiscal 2010

 

First Quarter
Fiscal 2009

Cash Flows From Operating Activities:

 

 

 

 

 

 

Net earnings

 

$ 12,497

 

 

$   6,611

 

Adjustments to reconcile net earnings to net cash provided by operating activities:

 

 

 

 

 

 

Depreciation

 

4,366

 

 

4,623

 

Amortization of intangible assets

 

250

 

 

308

 

Amortization of deferred financing costs and bond discount

 

488

 

 

335

 

Stock compensation expense

 

1,657

 

 

671

 

Loss on sale of property, plant and equipment

 

12

 

 

28

 

Deferred income taxes

 

(1,433

)

 

(594

)

Changes in working capital:

 

 

 

 

 

 

Receivables

 

(20,690

)

 

(14,759

)

Inventories

 

20,144

 

 

26,196

 

Prepaid expenses

 

(1,719

)

 

(678

)

Current liabilities

 

(2,524

)

 

(19,192

)

Other non-current assets

 

(301

)

 

(90

)

Other non-current liabilities

 

(1,630

)

 

(929

)

Net cash provided by operating activities

 

11,117

 

 

2,530

 

Cash Flows From Investing Activities:

 

 

 

 

 

 

Purchases of property, plant and equipment

 

(1,561

)

 

(3,771

)

Net cash used in investing activities

 

(1,561

)

 

(3,771

)

Cash Flows From Financing Activities:

 

 

 

 

 

 

Repayment of revolving credit arrangements

 

(22,350

)

 

(63,373

)

Proceeds from revolving credit arrangements

 

25,233

 

 

70,875

 

Proceeds from issuance of common stock

 

115

 

 

137

 

Dividends on common stock

 

(1,821

)

 

(1,430

)

Net cash provided by financing activities

 

1,177

 

 

6,209

 

Net change in cash and cash equivalents

 

10,733

 

 

4,968

 

Effect of foreign currency translation on cash and cash equivalents

 

(198

)

 

128

 

Cash and cash equivalents at the beginning of year

 

8,288

 

 

3,290

 

Cash and cash equivalents at the end of period

 

$ 18,823

 

 

$   8,386

 

 

 

 

 

 

 

 

Supplemental disclosure of cash flow information:

 

 

 

 

 

 

Cash paid for interest, net

 

$      286

 

 

$      514

 

Cash paid for income taxes

 

$   3,404

 

 

$      580

 

 

See accompanying notes.

 

6



Table of Contents

 

OXFORD INDUSTRIES, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FIRST QUARTER OF FISCAL 2010

 

1.              Basis of Presentation:  The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. GAAP for interim financial reporting and the instructions of Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP.  We believe the accompanying unaudited condensed consolidated financial statements reflect all normal, recurring adjustments that are necessary for a fair presentation of our financial position and results of operations as of the date and for the periods presented.  Results of operations for the interim periods presented are not necessarily indicative of results to be expected for our full fiscal year.  The accounting policies applied during the interim periods presented are consistent with the significant accounting policies described in our Annual Report on Form 10-K for fiscal 2009.

 

2.              Inventories:  The components of inventories as of the dates specified are summarized as follows (in thousands):

 

 

 

May 1,
2010

 

January 30,
2010

 

May 2,
2009

 

Finished goods

 

$ 92,288

 

 

$108,788

 

 

$129,597

 

 

Work in process

 

5,001

 

 

6,972

 

 

4,283

 

 

Fabric, trim and supplies

 

3,468

 

 

5,707

 

 

6,719

 

 

LIFO reserve

 

(44,438

)

 

(44,438

)

 

(46,724

)

 

Total

 

$ 56,319

 

 

$  77,029

 

 

$  93,875

 

 

 

3.              Comprehensive Income:  Comprehensive income, which reflects the effects of foreign currency translation adjustments, is calculated as follows for the periods presented (in thousands):

 

 

 

First Quarter
Fiscal 2010

 

First Quarter
Fiscal 2009

Net earnings

 

$12,497

 

 

$6,611

 

Gain (loss) on foreign currency translation, net of tax

 

(1,927

)

 

1,273

 

Comprehensive income

 

$10,570

 

 

$7,884

 

 

4.              Operating Group Information:  Our business is operated through our four operating groups: Tommy Bahama, Ben Sherman, Lanier Clothes and Oxford Apparel. We identify our operating groups based on the way our management organizes the components of our business for purposes of allocating resources and assessing performance. Corporate and Other is a reconciling category for reporting purposes and includes our corporate offices, substantially all financing activities,  elimination of inter-group sales,  LIFO inventory accounting adjustments and other costs that are not allocated to the operating groups.

 

The table below presents certain information about our operating groups (in thousands).

 

 

 

First Quarter
Fiscal 2010

 

First Quarter
Fiscal 2009

 

Net Sales

 

 

 

 

 

 

 

Tommy Bahama

 

$109,105

 

 

$  98,420

 

 

Ben Sherman

 

22,154

 

 

24,219

 

 

Lanier Clothes

 

30,428

 

 

31,507

 

 

Oxford Apparel

 

56,342

 

 

63,204

 

 

Corporate and Other

 

(279

)

 

(619

)

 

Total

 

$217,750

 

 

$216,731

 

 

 

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Table of Contents

 

 

 

First Quarter
Fiscal 2010

 

First Quarter
Fiscal 2009

 

Depreciation

 

 

 

 

 

 

 

Tommy Bahama

 

$  3,274

 

 

$  3,662

 

 

Ben Sherman

 

536

 

 

555

 

 

Lanier Clothes

 

119

 

 

145

 

 

Oxford Apparel

 

182

 

 

204

 

 

Corporate and Other

 

255

 

 

57

 

 

Total

 

$  4,366

 

 

$  4,623

 

 

Amortization of Intangible Assets

 

 

 

 

 

 

 

Tommy Bahama

 

$     173

 

 

$     222

 

 

Ben Sherman

 

67

 

 

76

 

 

Lanier Clothes

 

 

 

 

 

Oxford Apparel

 

10

 

 

10

 

 

Corporate and Other

 

 

 

 

 

Total

 

$     250

 

 

$    308

 

 

Operating Income (Loss)

 

 

 

 

 

 

 

Tommy Bahama

 

$17,861

 

 

$12,250

 

 

Ben Sherman

 

522

 

 

(1,976

)

 

Lanier Clothes

 

4,359

 

 

2,737

 

 

Oxford Apparel

 

5,971

 

 

5,193

 

 

Corporate and Other

 

(7,292

)

 

(4,792

)

 

Total Operating Income

 

$21,421

 

 

$13,412

 

 

Interest Expense, net

 

5,009

 

 

4,565

 

 

Earnings Before Income Taxes

 

$16,412

 

 

$  8,847

 

 

 

5.              Consolidating Financial Data of Subsidiary Guarantors:  Our 113/8% Senior Secured Notes due 2015 are guaranteed by substantially all of our wholly-owned domestic subsidiaries (“Subsidiary Guarantors”). All guarantees are full and unconditional. For consolidated financial reporting purposes, non-guarantors consist of our subsidiaries which are organized outside the United States and certain domestic subsidiaries. We use the equity method with respect to investment in subsidiaries included in other non-current assets in our condensed consolidating financial statements. Set forth below are our condensed consolidating balance sheets as of May 1, 2010, January 30, 2010 and May 2, 2009 (in thousands) as well as our condensed consolidating statements of operations and statements of cash flows for the first quarter of fiscal 2010 and fiscal 2009 (in thousands).

 

8



Table of Contents

 

OXFORD INDUSTRIES, INC.

UNAUDITED CONDENSED CONSOLIDATING BALANCE SHEETS

May 1, 2010

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Oxford
Industries
(Parent)

 

Subsidiary
Guarantors

 

Subsidiary
Non-
Guarantors

 

Consolidating
Adjustments

 

Consolidated
Total

 

ASSETS

Cash and cash equivalents

 

$  13,581

 

 

$        562

 

 

$   4,680

 

 

$          —

 

 

$  18,823

 

 

Receivables, net

 

44,199

 

 

 

16,525

 

 

 

41,447

 

 

 

(7,690

)

 

 

94,481

 

 

Inventories, net

 

(2,025

)

 

 

52,467

 

 

 

6,543

 

 

 

(666

)

 

 

56,319

 

 

Prepaid expenses and deferred tax assets

 

19,016

 

 

 

7,886

 

 

 

4,663

 

 

 

(3,882

)

 

 

27,683

 

 

Total current assets

 

74,771

 

 

 

77,440

 

 

 

57,333

 

 

 

(12,238

)

 

 

197,306

 

 

Property, plant and equipment, net

 

13,543

 

 

 

57,660

 

 

 

5,271

 

 

 

 

 

 

76,474

 

 

Intangible assets, net

 

18

 

 

 

112,999

 

 

 

23,016

 

 

 

 

 

 

136,033

 

 

Other non-current assets, net

 

510,663

 

 

 

148,913

 

 

 

4,208

 

 

 

(639,963

)

 

 

23,821

 

 

Total Assets

 

$598,995

 

 

$ 397,012

 

 

$ 89,828

 

 

$(652,201

)

 

$433,634

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

Current liabilities

 

$  31,017

 

 

$   38,651

 

 

$ 33,948

 

 

$    (7,673

)

 

$  95,943

 

 

Long-term debt, less current portion

 

146,572

 

 

 

 

 

 

 

 

 

 

 

 

146,572

 

 

Non-current liabilities

 

311,526

 

 

 

(298,549

)

 

 

143,954

 

 

 

(108,530

)

 

 

48,401

 

 

Non-current deferred income taxes

 

(4,646

)

 

 

26,258

 

 

 

6,580

 

 

 

 

 

 

28,192

 

 

Total shareholders’/invested equity

 

114,526

 

 

 

630,652

 

 

 

(94,654

)

 

 

(535,998

)

 

 

114,526

 

 

Total Liabilities and Shareholders’ Equity

 

$598,995

 

 

$ 397,012

 

 

$ 89,828

 

 

$(652,201

)

 

$433,634

 

 

 

OXFORD INDUSTRIES, INC.

CONDENSED CONSOLIDATING BALANCE SHEETS

January 30, 2010

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Oxford
Industries
(Parent)

 

Subsidiary
Guarantors

 

Subsidiary
Non-
Guarantors

 

Consolidating
Adjustments

 

Consolidated
Total

 

ASSETS

Cash and cash equivalents

 

$    5,954

 

$

782

 

$

1,552

 

$

 

$

8,288

 

Receivables, net

 

35,943

 

2,412

 

45,958

 

(9,915

)

74,398

 

Inventories

 

14,218

 

51,911

 

11,897

 

(997

)

77,029

 

Prepaid expenses and deferred tax assets

 

17,292

 

8,111

 

3,103

 

(3,918

)

24,588

 

Total current assets

 

73,407

 

63,216

 

62,510

 

(14,830

)

184,303

 

Property, plant and equipment, net

 

13,997

 

59,939

 

5,604

 

 

79,540

 

Intangible assets, net

 

28

 

113,173

 

24,289

 

 

137,490

 

Other non-current assets, net

 

499,389

 

148,932

 

4,216

 

(628,696

)

23,841

 

Total Assets

 

$586,821

 

$

385,260

 

$

96,619

 

$

(643,526

)

$

425,174

 

 

 

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

Current liabilities

 

39,507

 

27,319

 

38,686

 

(9,650

)

95,862

 

Long-term debt, less current portion

 

146,408

 

 

 

 

146,408

 

Non-current liabilities

 

300,896

 

(288,230

)

145,195

 

(107,795

)

50,066

 

Deferred income taxes

 

(4,407

)

27,000

 

6,794

 

(966

)

28,421

 

Total shareholders’/invested equity

 

104,417

 

619,171

 

(94,056

)

(525,115

)

104,417

 

Total Liabilities and Shareholders’ Equity

 

$586,821

 

$

385,260

 

$

96,619

 

$

(643,526

)

$

425,174

 

 

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Table of Contents

 

OXFORD INDUSTRIES, INC.

UNAUDITED CONDENSED CONSOLIDATING BALANCE SHEETS

May 2, 2009

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Oxford
Industries
(Parent)

 

Subsidiary
Guarantors

 

Subsidiary
Non-
Guarantors

 

Consolidating
Adjustments

 

Consolidated
Total

 

ASSETS

Cash and cash equivalents

 

 

$

2,034

 

$

2,070

 

$    4,282

 

$          —

 

$    8,386

 

Receivables, net

 

 

45,608

 

22,950

 

33,594

 

(8,357)

 

93,795

 

Inventories

 

 

17,971

 

67,411

 

10,471

 

(1,978)

 

93,875

 

Prepaid expenses and deferred tax assets

 

 

8,832

 

8,121

 

4,691

 

(152)

 

21,492

 

Total current assets

 

 

74,445

 

100,552

 

53,038

 

(10,487)

 

217,548

 

Property, plant and equipment, net

 

 

9,486

 

72,953

 

5,872

 

 

88,311

 

Intangible assets, net

 

 

57

 

113,838

 

22,559

 

 

136,454

 

Other non-current assets, net

 

 

461,904

 

145,896

 

35,271

 

(623,101)

 

19,970

 

Total Assets

 

 

$

545,892

 

$

433,239

 

$116,740

 

$(633,588)

 

$462,283

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

Current liabilities

 

 

$

49,416

 

$

32,550

 

$  34,877

 

$    (8,358)

 

$108,485

 

Long-term debt, less current portion

 

 

181,501

 

 

 

 

181,501

 

Non-current liabilities

 

 

223,892

 

(176,134)

 

107,701

 

(109,155)

 

46,304

 

Non-current deferred income taxes

 

 

(3,487)

 

28,563

 

6,347

 

 

31,423

 

Total shareholders’/invested equity

 

 

94,570

 

548,260

 

(32,185)

 

(516,075)

 

94,570

 

Total Liabilities and Shareholders’ Equity

 

 

$

545,892

 

$

433,239

 

$116,740

 

$(633,588)

 

$462,283

 

 

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Table of Contents

 

OXFORD INDUSTRIES, INC.

UNAUDITED CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS

First Quarter Fiscal 2010

 

 

 

Oxford
Industries
(Parent)

 

Subsidiary
Guarantors

 

Subsidiary
Non-
Guarantors

 

Consolidating
Adjustments

 

Consolidated
Total

 

Net sales

 

$

92,676

 

$

110,957

 

$

22,332

 

$

(8,215

)

$

217,750

 

Cost of goods sold

 

68,620

 

42,738

 

8,483

 

(3,673

)

116,168

 

Gross profit

 

24,056

 

68,219

 

13,849

 

(4,542

)

101,582

 

SG&A including amortization of intangible assets

 

22,691

 

54,642

 

12,897

 

(6,228

)

84,002

 

Royalties and other operating income

 

37

 

2,930

 

1,568

 

(694

)

3,841

 

Operating income

 

1,402

 

16,507

 

2,520

 

992

 

21,421

 

Interest (income) expense, net

 

4,965

 

(1,041

)

682

 

403

 

5,009

 

Income from equity investment

 

12,810

 

 

 

(12,810

)

 

Earnings before income taxes

 

9,247

 

17,548

 

1,838

 

(12,221

)

16,412

 

Income taxes (benefit)

 

(2,866

)

6,066

 

509

 

206

 

3,915

 

Net earnings

 

$

12,113

 

$

11,482

 

$

1,329

 

$

(12,427

)

$

12,497

 

 

OXFORD INDUSTRIES, INC.

UNAUDITED CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS

First Quarter Fiscal 2009

 

 

 

Oxford
Industries
(Parent)

 

Subsidiary
Guarantors

 

Subsidiary
Non-
Guarantors

 

Consolidating
Adjustments

 

Consolidated
Total

 

Net sales

 

$

92,793

 

$

108,065

 

$

25,285

 

$

(9,412

)

$

216,731

 

Cost of goods sold

 

74,506

 

45,964

 

10,788

 

(4,461

)

126,797

 

Gross profit

 

18,287

 

62,101

 

14,497

 

(4,951

)

89,934

 

SG&A including amortization of intangible assets

 

13,987

 

57,034

 

13,979

 

(6,009

)

78,991

 

Royalties and other operating income

 

13

 

2,219

 

980

 

(743

)

2,469

 

Operating income

 

4,313

 

7,286

 

1,498

 

315

 

13,412

 

Interest (income) expense, net

 

4,956

 

(1,347

)

956

 

 

4,565

 

Income from equity investment

 

6,956

 

 

 

(6,956

)

 

Earnings before income taxes

 

6,313

 

8,633

 

542

 

(6,641

)

8,847

 

Income taxes (benefit)

 

(95

)

2,263

 

(42

)

110

 

2,236

 

Net earnings

 

$

6,408

 

$

6,370

 

$

584

 

$

(6,751

)

$

6,611

 

 

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Table of Contents

 

OXFORD INDUSTRIES, INC.

UNAUDITED CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

First Quarter Fiscal 2010

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Oxford
Industries
(Parent)

 

Subsidiary
Guarantors

 

Subsidiary
Non-Guarantors

 

Consolidating
Adjustments

 

Consolidated
Total

 

Cash Flows From Operating Activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net cash (used in) provided by operating activities

 

$

(1,963

)

 

$

11,166

 

 

$ 1,914

 

 

$—

 

$11,117

 

 

Cash Flows from Investing Activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net cash used in investing activities

 

 

(287

)

 

 

(983

)

 

(291

)

 

 

(1,561

)

 

Cash Flows from Financing Activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Change in debt

 

 

 

 

 

 

 

2,883

 

 

 

2,883

 

 

Proceeds from issuance of common stock

 

 

115

 

 

 

 

 

 

 

 

115

 

 

Change in intercompany payable

 

 

11,583

 

 

 

(10,403

)

 

(1,180

)

 

 

 

 

Dividends on common stock

 

 

(1,821

)

 

 

 

 

 

 

 

(1,821

)

 

Net cash (used in) provided by financing activities

 

 

9,877

 

 

 

(10,403

)

 

1,703

 

 

 

1,177

 

 

Net change in cash and cash equivalents

 

 

7,627

 

 

 

(220

)

 

3,326

 

 

 

10,733

 

 

Effect of foreign currency translation

 

 

 

 

 

 

 

(198

)

 

 

(198

)

 

Cash and cash equivalents at the beginning of period

 

 

5,954

 

 

 

782

 

 

1,552

 

 

 

8,288

 

 

Cash and cash equivalents at the end of period

 

$

13,581

 

 

$

562

 

 

$ 4,680

 

 

$—

 

$18,823

 

 

 

OXFORD INDUSTRIES, INC.

UNAUDITED CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS

First Quarter Fiscal 2009

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Oxford
Industries
(Parent)

 

Subsidiary
Guarantors

 

Subsidiary
Non-
Guarantors

 

Consolidating
Adjustments

 

Consolidated
Total

 

Cash Flows From Operating Activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net cash (used in) provided by operating activities

 

$

(11,894

)

 

$

12,187

 

 

$

2,241

 

 

$ (4)

 

$

2,530

 

 

Cash Flows from Investing Activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net cash used in investing activities

 

 

(835

)

 

 

(2,007

)

 

 

(929

)

 

 

 

(3,771

)

 

Cash Flows from Financing Activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Change in debt

 

 

7,793

 

 

 

 

 

 

(291

)

 

 

 

7,502

 

 

Proceeds from issuance of common stock

 

 

137

 

 

 

 

 

 

 

 

 

 

137

 

 

Change in intercompany payable

 

 

6,736

 

 

 

(8,214

)

 

 

1,474

 

 

4

 

 

 

 

Dividends on common stock

 

 

(1,430

)

 

 

 

 

 

 

 

 

 

(1,430

)

 

Net cash (used in) provided by financing activities

 

 

13,236

 

 

 

(8,214

)

 

 

1,183

 

 

4

 

 

6,209

 

 

Net change in cash and cash equivalents

 

 

507

 

 

 

1,966

 

 

 

2,495

 

 

 

 

4,968

 

 

Effect of foreign currency translation

 

 

 

 

 

 

 

 

128

 

 

 

 

128

 

 

Cash and cash equivalents at the beginning of period

 

 

1,527

 

 

 

104

 

 

 

1,659

 

 

 

 

3,290

 

 

Cash and cash equivalents at the end of period

 

$

2,034

 

 

$

2,070

 

 

$

4,282

 

 

$—

 

$

8,386

 

 

 

12



Table of Contents

 

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

The following discussion and analysis should be read in conjunction with our unaudited condensed consolidated financial statements and the notes to the unaudited condensed consolidated financial statements contained in this report and the consolidated financial statements, notes to consolidated financial statements and Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in our Annual Report on Form 10-K for fiscal 2009.

 

OVERVIEW

 

We generate revenues and cash flow primarily through the design, production, sale and distribution of branded and private label consumer apparel for men and women and the licensing of company-owned trademarks. Our principal markets and customers are located in the United States and, to a lesser extent, the United Kingdom. We source substantially all of our products through third-party manufacturers located outside of the United States and United Kingdom. We distribute the majority of our products through our wholesale customers, which include chain stores, department stores, specialty stores, specialty catalog retailers, mass merchants and Internet retailers. Our products for certain owned brands are also sold through our owned and licensed retail stores and e-commerce websites.

 

As a result of the weak global economic conditions, fiscal 2009 was a particularly challenging year for each of our operating groups. While we have seen some signs of recovery, we believe these challenging economic conditions will continue to persist and impact each of our operating groups in fiscal 2010. Thus, we have purchased inventory for fiscal 2010 at levels which we believe will mitigate inventory markdown risk and promotional pressure, but also may limit our growth opportunities. In the current economic environment, we also believe it is important to continue to focus on maintaining a strong balance sheet and ample liquidity. We believe that the measures we have taken to reduce working capital requirements, moderate capital expenditures for retail stores, reduce our overhead and refinance our significant debt agreements have significantly enhanced our balance sheet and liquidity.

 

The apparel and retail industry is cyclical and dependent upon the overall level of discretionary consumer spending, which changes as regional, domestic and international economic conditions change. The impact of negative economic conditions may have a longer and more severe impact on the apparel and retail industry than the same conditions would have on other industries. Therefore, even if conditions improve in the general economy, the negative impact on the apparel and retail industry may continue.

 

The following table sets forth our consolidated operating results (in thousands, except per share amounts) for the first quarter of fiscal 2010 compared to the first quarter of fiscal 2009:

 

 

 

First Quarter

 

 

 

 

 

Fiscal 2010

 

Fiscal 2009

 

$ Change

 

Net sales

 

$217,750

 

 

$216,731

 

 

$1,019

 

Net earnings

 

$  12,497

 

 

$    6,611

 

 

$5,886

 

Diluted net earnings per common share

 

$      0.76

 

 

$      0.42

 

 

$  0.34

 

Weighted average common shares outstanding—diluted

 

16,503

 

 

15,876

 

 

 

 

 

The primary reasons for the improvement in net earnings were:

 

·                  Improved gross margins in each operating group in the first quarter of fiscal 2010 primarily due to product mix within each group and the lack of sales related to certain exited businesses in the first quarter of fiscal 2010.

 

·                  A change in our consolidated net sales mix, with Tommy Bahama sales, which generally have higher gross margins than our other operating groups, representing a higher proportion of consolidated net sales during the first quarter of fiscal 2010.

 

·                  Increased royalty income in both Tommy Bahama and Ben Sherman resulting from increased sales during the first quarter of fiscal 2010 by existing licensees, as well as the addition of new licensees.

 

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Table of Contents

 

These items were partially offset by increased SG&A primarily due to increased incentive compensation amounts resulting from the resumption of our incentive compensation program which was suspended in fiscal 2009 and is tied to our financial performance.

 

OPERATING GROUPS

 

Our business is operated through our four operating groups: Tommy Bahama, Ben Sherman, Lanier Clothes and Oxford Apparel. We identify our operating groups based on the way our management organizes the components of our business for purposes of allocating resources and assessing performance.

 

Tommy Bahama designs, sources and markets collections of men’s and women’s sportswear and related products. The target consumers of Tommy Bahama are affluent men and women age 35 and older who embrace a relaxed and casual approach to daily living. Tommy Bahama® products can be found in our owned and licensed Tommy Bahama retail stores and on our e-commerce website as well as in certain department stores and independent specialty stores throughout the United States. We also license the Tommy Bahama name for various product categories and operate Tommy Bahama restaurants.

 

Ben Sherman is a London-based designer, marketer and distributor of branded sportswear and related products. Ben Sherman® was established in 1963 as an edgy, young men’s, “Mod”-inspired shirt brand and has evolved into a British lifestyle brand of apparel targeted at youthful-thinking men age 19 to 35 throughout the world. We offer a Ben Sherman men’s sportswear collection as well as tailored clothing and accessories. Our Ben Sherman products can be found in certain department stores and a variety of independent specialty stores and in our owned and licensed Ben Sherman retail stores as well as on our e-commerce websites. We also license the Ben Sherman name for various product categories.

 

Lanier Clothes designs and markets branded and private label men’s suits, sportcoats, suit separates and dress slacks across a wide range of price points. Certain Lanier Clothes products are sold using trademarks licensed to us by third parties, including Kenneth Cole®, Dockers®, and Geoffrey Beene®. We also offer branded tailored clothing products under our Billy London® and Arnold Brant® trademarks. In addition to our branded businesses, we design and source certain private label tailored clothing products. Significant private label brands include Stafford®, Lands’ End® and Alfani®. Our Lanier Clothes products are sold to national chains, department stores, mass merchants, specialty stores, specialty catalog retailers and discount retailers throughout the United States.

 

Oxford Apparel produces branded and private label dress shirts, suit separates, sport shirts, casual slacks, outerwear, sweaters, jeans, swimwear, westernwear and golf apparel. We design and source certain private label programs for several customers, including programs for Costco, Lands’ End, Target, Macy’s and Sears. Significant owned brands of Oxford Apparel include Oxford Golf®, Ely®, Cattleman® and Cumberland Outfitters®. Oxford Apparel also owns a two-thirds interest in the entity that owns the Hathaway® trademark in the United States and several other countries. Additionally, Oxford Apparel licenses from third parties the right to use certain trademarks including Dockers and United States Polo Association® for certain apparel products. Our Oxford Apparel products are sold to a variety of department stores, mass merchants, specialty catalog retailers, discount retailers, specialty stores, “green grass” golf merchants and Internet retailers throughout the United States.

 

Corporate and Other is a reconciling category for reporting purposes and includes our corporate office, substantially all financing activities, elimination of inter-segment sales, LIFO inventory accounting adjustments and other costs that are not allocated to the operating groups. LIFO inventory calculations are made on a legal entity basis which does not correspond to our operating group definitions; therefore, LIFO inventory accounting adjustments are not allocated to operating groups.

 

For further information regarding our operating groups, see Note 4 to our unaudited condensed consolidated financial statements included in this report and Part I, Item 1, Business in our Annual Report on Form 10-K for fiscal 2009.

 

RESULTS OF OPERATIONS

 

FIRST QUARTER OF FISCAL 2010 COMPARED TO FIRST QUARTER OF FISCAL 2009

 

The following table sets forth the specified line items in our unaudited condensed consolidated statements of operations both in dollars (in thousands) and as a percentage of net sales. The table also sets forth the dollar change and the percentage change of the data as compared to the same period of the prior year. We have calculated all percentages based on actual data, but percentage columns may not add due to rounding. Individual line items of our

 

14



Table of Contents

 

consolidated statements of operations may not be directly comparable to those of our competitors, as classification of certain expenses may vary by company.

 

 

 

First Quarter

 

 

 

 

 

 

 

Fiscal 2010

 

Fiscal 2009

 

$ Change

 

% Change

 

Net sales

 

$217,750

 

100.0%

 

$216,731

 

100.0%

 

$   1,019

 

0.5%

 

Cost of goods sold

 

116,168

 

53.3%

 

126,797

 

58.5%

 

(10,629

)

(8.4%

)

Gross profit

 

101,582

 

46.7%

 

89,934

 

41.5%

 

11,648

 

13.0%

 

SG&A

 

83,752

 

38.5%

 

78,683

 

36.3%

 

5,069

 

6.4%

 

Amortization of intangible assets

 

250

 

0.1%

 

308

 

0.1%

 

(58

)

(18.8%

)

Royalties and other operating income

 

3,841

 

1.8%

 

2,469

 

1.1%

 

1,372

 

55.6%

 

Operating income

 

21,421

 

9.8%

 

13,412

 

6.2%

 

8,009

 

59.7%

 

Interest expense, net

 

5,009

 

2.3%

 

4,565

 

2.1%

 

444

 

9.7%

 

Earnings before income taxes

 

16,412

 

7.5%

 

8,847

 

4.1%

 

7,565

 

85.5%

 

Income taxes

 

3,915

 

1.8%

 

2,236

 

1.0%

 

1,679

 

75.1%

 

Net earnings

 

$  12,497

 

5.7%

 

$   6,611

 

3.1%

 

$   5,886

 

89.0%

 

 

The discussion and tables below compare certain line items included in our statements of operations for the first quarter of fiscal 2010 to the first quarter of fiscal 2009. Each dollar and percentage change provided reflects the change between these periods unless indicated otherwise. Each dollar and share amount included in the tables is in thousands except for per share amounts.

 

Net Sales

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

First Quarter

 

 

 

 

 

 

 

 

 

 

 

Fiscal 2010

 

Fiscal 2009

 

$ Change

 

% Change

 

Tommy Bahama

 

 

 

 

 

$109,105

 

 

$  98,420

 

 

$10,685

 

 

10.9%

 

Ben Sherman

 

 

 

 

 

22,154

 

 

24,219

 

 

(2,065

)

 

(8.5%

)

Lanier Clothes

 

 

 

 

 

30,428

 

 

31,507

 

 

(1,079

)

 

(3.4%

)

Oxford Apparel

 

 

 

 

 

56,342

 

 

63,204

 

 

(6,862

)

 

(10.9%

)

Corporate and Other

 

 

 

 

 

(279

)

 

(619

)

 

340

 

 

54.9%

 

Total net sales

 

 

 

 

 

$217,750

 

 

$216,731

 

 

$  1,019

 

 

0.5%

 

 

Consolidated net sales increased $1.0 million, or 0.5%, in the first quarter of fiscal 2010 compared to the first quarter of fiscal 2009 primarily as a result of the improved retail environment, resulting in certain customers requesting the shipment of product in the first quarter of fiscal 2010 which we had planned to ship in the second quarter of fiscal 2010 and the other changes in each operating group discussed below.

 

Tommy Bahama:

 

The increase in net sales for Tommy Bahama was due to increases in both the direct to consumer and wholesale channels of distribution as the retail environment improved. Apparel unit sales increased 19.5% while the average selling price per unit for apparel decreased by 5.9%. As of May 1, 2010 and May 2, 2009, we operated 84 Tommy Bahama retail stores.

 

Ben Sherman:

 

The decrease in net sales for Ben Sherman was primarily due to an 8.9% reduction in unit sales primarily resulting from our exit and subsequent licensing of our footwear and kids’ businesses and the exit from the women’s operations. The decrease was partially offset by a 5.6% increase in the average exchange rate of the British pound sterling versus the United States dollar during the first quarter of fiscal 2010 compared to the average exchange rate during the first quarter of fiscal 2009 and higher sales at our own retail stores. The average selling price per unit for Ben Sherman remained relatively flat compared to the first quarter of fiscal 2009.

 

Lanier Clothes:

 

The decrease in net sales for Lanier Clothes was primarily due to our exit from certain businesses as the first quarter of fiscal 2009 included close-out sales associated with these businesses. This decrease in net sales was partially offset by higher sales levels in our owned and licensed branded businesses primarily resulting from the improved retail environment. Unit sales declined 1.4% and the average selling price per unit decreased 2.0%.

 

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Table of Contents

 

Oxford Apparel:

 

The decrease in net sales for Oxford Apparel was primarily due to the first quarter of fiscal 2009 including close-out sales related to certain businesses that we previously exited, partially offset by the positive impact of the improved retail environment.  Unit sales declined 11.2% and the average selling price per unit was relatively flat between the two periods.

 

Gross Profit

 

 

 

First Quarter

 

 

 

 

 

 

 

Fiscal 2010

 

Fiscal 2009

 

$ Change

 

% Change

 

Gross profit

 

$101,582

 

 

$89,934

 

 

$11,648

 

 

13.0%

 

Gross margin (gross profit as a % of net sales)

 

46.7

%

 

41.5

%

 

 

 

 

 

 

LIFO charges included in cost of goods sold

 

$       651

 

 

$  1,448

 

 

 

 

 

 

 

 

The increase in gross profit was primarily due to improved gross margins in each operating group resulting from changes in product mix in each operating group and the increase in Tommy Bahama’s net sales, which generally have higher gross margins than our other operating groups, both in total and as a proportion of consolidated net sales.  Gross margins increased to 46.7% of net sales during the first quarter of fiscal 2010 from 41.5% in the first quarter of fiscal 2009. Gross profit included charges for LIFO accounting of $0.7 million in the first quarter of fiscal 2010 and $1.4 million in the first quarter of fiscal 2009. We anticipate that consolidated gross margins in fiscal 2010 will continue to increase compared to the prior year as our consolidated sales mix is more heavily weighted towards Tommy Bahama, however, this change will be partially offset by increases in cotton prices, wages in Asia and ocean shipping costs. Our gross profit may not be directly comparable to those of our competitors, as statement of operations classification of certain expenses may vary by company.

 

SG&A

 

 

 

First Quarter

 

 

 

 

 

 

 

Fiscal 2010

 

Fiscal 2009

 

$ Change

 

% Change

 

SG&A

 

$83,752

 

 

$78,683

 

 

$5,069

 

 

6.4%

 

SG&A (as % of net sales)

 

38.5

%

 

36.3

%

 

 

 

 

 

 

 

The increase in SG&A was primarily due to costs associated with the resumption of our incentive compensation program which was suspended in fiscal 2009 and is tied to our financial performance.  The increase was also due to severance related costs.

 

Royalties and other operating income

 

 

 

First Quarter

 

 

 

 

 

 

 

Fiscal 2010

 

Fiscal 2009

 

$ Change

 

% Change

 

Royalties and other operating income

 

$3,841

 

$2,469

 

$1,372

 

55.6%

 

 

The increase in royalties and other operating income were primarily due to increased royalty income in both Tommy Bahama and Ben Sherman as sales reported by certain licensees increased and new licensees were added.

 

Operating income (loss)

 

 

 

First Quarter

 

 

 

 

 

 

 

Fiscal 2010

 

Fiscal 2009

 

$ Change

 

% Change

 

Tommy Bahama

 

$17,861

 

 

$12,250

 

 

$ 5,611

 

 

45.8%

 

Ben Sherman

 

522

 

 

(1,976

)

 

2,498

 

 

126.4%

 

Lanier Clothes

 

4,359

 

 

2,737

 

 

1,622

 

 

59.3%

 

Oxford Apparel

 

5,971

 

 

5,193

 

 

778

 

 

15.0%

 

Corporate and Other

 

(7,292

)

 

(4,792

)

 

(2,500

)

 

(52.2%

)

Total operating income (loss)

 

$ 21,421

 

 

$13,412

 

 

$ 8,009

 

 

59.7%

 

Total LIFO charges included in total operating income

 

$      651

 

 

$  1,448

 

 

 

 

 

 

 

 

Operating income, on a consolidated basis, increased to $21.4 million in the first quarter of fiscal 2010 from $13.4 million in the first quarter of fiscal 2009. The $8.0 million increase in operating income was primarily due to the increased net sales, improved gross margins resulting from changes in sales mix and higher royalty income, which was partially offset by increased SG&A, each as described above. Operating income included charges for LIFO accounting

 

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of $0.7 million in the first quarter of fiscal 2010 and $1.4 million in the first quarter of fiscal 2009. Changes in operating income by operating group are discussed below.

 

Tommy Bahama:

 

 

 

First Quarter

 

 

 

 

 

 

 

Fiscal 2010

 

Fiscal 2009

 

$ Change

 

% Change

 

Net sales

 

$109,105

 

 

$98,420

 

 

$10,685

 

 

10.9%

 

Operating income

 

$  17,861

 

 

$12,250

 

 

$  5,611

 

 

45.8%

 

Operating income as % of net sales

 

16.4

%

 

12.4

%

 

 

 

 

 

 

 

The increase in operating income for Tommy Bahama was primarily due to the increased net sales, improved gross margins due to sales mix and higher royalty income, partially offset by increased SG&A.

 

Ben Sherman:

 

 

 

First Quarter

 

 

 

 

 

 

 

Fiscal 2010

 

Fiscal 2009

 

$ Change

 

% Change

 

Net sales

 

$22,154

 

 

$24,219

 

 

$(2,065

)

 

(8.5%

)

Operating income (loss)

 

$     522

 

 

$ (1,976

)

 

$ 2,498

 

 

126.4%

 

Operating income (loss) as % of net sales

 

2.4

%

 

(8.2

%)

 

 

 

 

 

 

 

The increase in operating income for Ben Sherman was primarily due to increased gross margins and reduced SG&A, both of which were a result of our exit from and subsequent licensing of the footwear and kids’ business and our exit from the women’s operations, and increased royalty income.

 

Lanier Clothes:

 

 

 

First Quarter

 

 

 

 

 

 

 

Fiscal 2010

 

Fiscal 2009

 

$ Change

 

% Change

 

Net sales

 

$30,428

 

 

$31,507

 

 

$(1,079

)

 

(3.4%

)

Operating income

 

$  4,359

 

 

$  2,737

 

 

$ 1,622

 

 

59.3%

 

Operating income as % of net sales

 

14.3

%

 

8.7

%

 

 

 

 

 

 

 

The increase in operating income for Lanier Clothes was primarily due to improved gross margins due to (1) sales mix with branded sales representing a greater proportion of Lanier Clothes’ sales, (2) improved product cost and (3) close-out sales associated with exited businesses included in the prior year. The improved gross margins were partially offset by increased SG&A resulting from higher incentive compensation.

 

Oxford Apparel:

 

 

 

First Quarter

 

 

 

 

 

 

 

Fiscal 2010

 

Fiscal 2009

 

$ Change

 

% Change

 

Net sales

 

$56,342

 

 

$63,204

 

 

$(6,862

)

 

(10.9%

)

Operating income

 

$  5,971

 

 

$  5,193

 

 

$    778

 

 

15.0%

 

Operating income as % of net sales

 

10.6

%

 

8.2

%

 

 

 

 

 

 

 

The increase in operating income was primarily due to decreased SG&A and improved gross margins due to the prior year including certain close-out sales associated with exited businesses.

 

Corporate and Other:

 

 

 

First Quarter

 

 

 

 

 

 

Fiscal 2010

 

Fiscal 2009

 

$ Change

 

% Change

 

Operating income (loss)

 

$(7,292

)

 

$(4,792

)

 

$(2,500

)

 

(52.2%

)

LIFO charges included in operating income (loss)

 

$    651

 

 

$ 1,448

 

 

 

 

 

 

 

 

The Corporate and Other operating loss increased $2.5 million from a loss of $4.8 million in the first quarter of fiscal 2009 to a loss of $7.3 million in the first quarter of fiscal 2010. The increase in the operating loss was primarily due to higher incentive compensation and severance costs. Operating loss included LIFO accounting charges of $0.7 million in the first quarter of fiscal 2010 and $1.4 million in the first quarter of fiscal 2009.

 

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Interest expense, net

 

 

 

First Quarter

 

 

 

 

 

 

 

Fiscal 2010

 

Fiscal 2009

 

$ Change

 

% Change

 

Interest expense, net

 

$5,009

 

$4,565

 

$444

 

9.7%

 

 

The increase in interest expense was primarily due to the higher interest rate associated with our 113/8% Senior Secured Notes due 2015, which we issued in the second quarter of fiscal 2009. This higher interest rate was partially offset by a lower level of borrowings resulting from our use of positive operating cash flows to reduce our debt levels.

 

Income taxes

 

 

 

First Quarter

 

 

 

 

 

 

 

Fiscal 2010

 

Fiscal 2009

 

$ Change

 

% Change

 

Income taxes

 

$3,915

 

$2,236

 

$1,679

 

75.1%

 

Effective tax rate

 

23.9%

 

25.3%

 

 

 

 

 

 

The rates for both periods reflect the favorable impact of permanent differences which do not necessarily fluctuate with earnings as well as the impact of certain discrete items, including the decrease in certain income tax contingency reserves upon the expiration of the corresponding statute of limitations.

 

Net earnings

 

 

 

First Quarter

 

 

 

 

 

 

 

Fiscal 2010

 

Fiscal 2009

 

Change

 

% Change

 

Net earnings

 

$12,497

 

$  6,611

 

$5,886

 

89.0%

 

Diluted net earnings per common share

 

$    0.76

 

   0.42

 

$  0.34

 

81.0%

 

Weighted average common shares outstanding-diluted

 

16,503

 

15,876

 

627

 

3.9%

 

 

The increase in diluted net earnings per common share was primarily due to (1) the improved gross margins in each operating group, (2) the change in sales mix with a greater proportion of net sales being sales of Tommy Bahama products and (3) higher royalty income, which were partially offset by higher SG&A, primarily due to higher incentive compensation costs resulting from the improved operating results in each group.

 

FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES

 

Our primary source of revenue and cash flow is our operating activities in the United States and, to a lesser extent, the United Kingdom. When cash inflows are less than cash outflows, we also have access to amounts under our U.S. Revolving Credit Agreement and U.K. Revolving Credit Agreement (each as described below), subject to their terms, each of which is described below. We may seek to finance future capital investment programs through various methods, including, but not limited to, cash flow from operations, borrowings under our current or additional credit facilities and sales of debt or equity securities.

 

Our liquidity requirements arise from the funding of our working capital needs, which include inventory and accounts receivable, other operating expenses, funding of capital expenditures, payment of quarterly dividends, periodic interest payments related to our financing arrangements and repayment of our indebtedness. Some of our product purchases are facilitated by trade letters of credit which are drawn against our lines of credit at the time of shipment of the products and reduce the amounts available under our lines of credit and borrowing capacity under our credit facilities when issued.

 

Key Liquidity Measures

 

($ in thousands)

 

May 1, 2010

 

January 30, 2010

 

May 2, 2009

 

January 31, 2009

 

Current assets

 

$197,306

 

 

$184,303

 

 

$217,548

 

 

$222,477

 

 

Current liabilities

 

95,943

 

 

95,862

 

 

108,485

 

 

106,833

 

 

Working capital

 

$101,363

 

 

$  88,441

 

 

$109,063

 

 

$115,644

 

 

Working capital ratio

 

2.06

 

 

1.92

 

 

2.01

 

 

2.08

 

 

Debt to total capital ratio

 

57

%

 

58

%

 

69

%

 

70

%

 

 

Our working capital ratio is calculated by dividing total current assets by total current liabilities, both of which declined from May 2, 2009 to May 1, 2010, as described below. For the ratio of debt to total capital, debt is defined as short-term and long-term debt, and total capital is defined as debt plus shareholders’ equity. The change in the debt to

 

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total capital ratio from May 2, 2009 to May 1, 2010 was primarily a result of the significant reduction in debt since May 2, 2009 due to cash flows from operations, as well as increased shareholders’ equity due to our net earnings subsequent to May 2, 2009. Our debt levels and ratio of debt to total capital in future periods may not be comparable to historical amounts as we continue to assess and may periodically make changes to our capital structure. Changes in our capital structure, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors.

 

Balance Sheet

 

The following tables set forth certain information included in our consolidated balance sheets (in thousands). Below each table are explanations for any significant changes in the balances from May 2, 2009 to May 1, 2010.

 

Current Assets:

 

 

 

May 1, 2010

 

January 30, 2010

 

May 2, 2009

 

January 31, 2009

 

Cash and cash equivalents

 

$  18,823

 

$    8,288

 

$    8,386

 

$    3,290

 

Receivables, net

 

94,481

 

74,398

 

93,795

 

78,567

 

Inventories, net

 

56,319

 

77,029

 

93,875

 

119,616

 

Prepaid expenses

 

12,286

 

10,713

 

11,629

 

10,845

 

Deferred tax assets

 

15,397

 

13,875

 

9,863

 

10,159

 

Total current assets

 

$197,306

 

$184,303

 

$217,548

 

$222,477

 

 

Cash and cash equivalents increased at May 1, 2010 primarily due to our positive cash flows from operating activities subsequent to May 2, 2009. Inventory levels for each operating group have decreased significantly as (1) we emphasized increasing inventory turns, (2) focused on mitigating inventory markdown risk and promotional pressure, (3) exited certain lines of business and (4) certain sales that were originally expected for the second quarter of fiscal 2010 were shipped during the first quarter of fiscal 2010 at the request of wholesale customers. The increase in deferred tax assets was primarily related to the tax impact associated with inventory levels.

 

Non-current Assets:

 

 

 

May 1, 2010

 

January 30, 2010

 

May 2, 2009

 

January 31, 2009

 

Property, plant and equipment, net

 

$  76,474

 

$  79,540

 

$  88,311

 

$  89,026

 

Intangible assets, net

 

136,033

 

137,490

 

136,454

 

135,999

 

Other non-current assets, net

 

23,821

 

23,841

 

19,970

 

20,180

 

Total non-current assets, net

 

$236,328

 

$240,871

 

$244,735

 

$245,205

 

 

The decrease in property, plant and equipment, net was primarily due to depreciation expense exceeding capital expenditures during the twelve months preceding May 1, 2010, as we reduced our investments in new retail stores during the challenging economic environment. The increase in other non-current assets, net was primarily due to the payment of certain deferred financing costs associated with the offering of our 113/8% Senior Secured Notes in June 2009 and the increase in deferred compensation plan asset values.

 

Liabilities:

 

 

 

May 1, 2010

 

January 30, 2010

 

May 2, 2009

 

January 31, 2009

 

Current liabilities

 

$  95,943

 

$  95,862

 

$108,485

 

$106,833

 

Long-term debt less current maturities

 

146,572

 

146,408

 

181,501

 

194,187

 

Other non-current liabilities

 

48,401

 

50,066

 

46,304

 

47,244

 

Non-current deferred income taxes

 

28,192

 

28,421

 

31,423

 

32,111

 

Total liabilities

 

$319,108

 

$320,757

 

$367,713

 

$380,375

 

 

The decrease in current liabilities was primarily due to the reduction in the current maturities of long-term debt from the prior year. This decrease was partially offset by an increase in accrued compensation and income tax payable as of May 1, 2010. The decrease in long-term debt less current maturities and current maturities of long-term debt are primarily due to cash flow from operating activities for the twelve months preceeding May 1, 2010. The cash flow from operating activities was a result of net earnings and improved working capital positions. The increase in other non-current liabilities was primarily due to the increase in deferred compensation plan liabilities. The change in non-current deferred income taxes primarily resulted from (1) changes in book/tax differences for depreciation and deferred compensation, (2) changes in tax accrued on undistributed foreign earnings and (3) the indirect federal benefit of

 

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certain reserves for uncertain tax positions and adjustments to reflect changes in the effective tax rate at which certain deferred items are expected to be realized, which are partially offset by changes in foreign currency rates.

 

Statement of Cash Flows

 

The following table sets forth the net cash flows resulting in the change in our in cash and cash equivalents (in thousands):

 

 

 

First Quarter

 

 

 

Fiscal 2010

 

Fiscal 2009

 

Net cash provided by operating activities

 

$11,117 

 

$ 2,530 

 

Net cash used in investing activities

 

(1,561)

 

(3,771)

 

Net cash provided by financing activities

 

1,177 

 

6,209 

 

Net change in cash and cash equivalents

 

$10,733 

 

$ 4,968 

 

 

Operating Activities:

 

The operating cash flows for the first quarter of fiscal 2010 and the first quarter of fiscal 2009 were primarily the result of net earnings for the relevant period, adjusted for non-cash activities such as depreciation, amortization and stock compensation expense as well as changes in our working capital accounts. In both fiscal 2010 and fiscal 2009, the significant changes in working capital were (1) decreased inventories, (2) decreased current liabilities and (3) increased accounts receivable. These changes reflect our emphasis on reducing our working capital investment during the challenging economic conditions.

 

Investing Activities:

 

During the first quarter of fiscal 2010 and fiscal 2009, investing activities used $1.6 million and $3.8 million, respectively, of cash. In each of the applicable periods, these investing activities primarily consisted of capital expenditures related to new retail stores and costs associated with investment in certain technology initiatives, including the continuing implementation of our new integrated financial systems.

 

Financing Activities:

 

During the first quarter of fiscal 2010 and fiscal 2009, financing activities provided $1.2 million and $6.2 million, respectively, of cash. In each of the applicable periods, these financing activities resulted primarily from borrowings under our revolving credit facilities, partially offset by the payment of dividends in each period.

 

Liquidity and Capital Resources

 

The table below provides a description of our significant financing arrangements and the amounts outstanding under these financing arrangements (in thousands) as of May 1, 2010:

 

$175 million U.S. Secured Revolving Credit Facility (“U.S. Revolving Credit Agreement”), which is limited to a borrowing base consisting of specified percentages of eligible categories of assets, accrues interest, unused line fees and letter of credit fees based upon a pricing grid which is tied to average unused availability, requires interest payments monthly with principal due at maturity (August 2013) and is secured by a first priority security interest in the accounts receivable (other than royalty payments in respect of trademark licenses), inventory, investment property (including the equity interests of certain subsidiaries), general intangibles (other than trademarks, trade names and related rights), deposit accounts, intercompany obligations, equipment, goods, documents, contracts, books and records and other personal property of Oxford Industries, Inc. and substantially all of its domestic subsidiaries and a second priority interest in those assets in which the holders of the 113/8% Senior Secured Notes have a first priority interest

 

$

 

£10 million Senior Secured Revolving Credit Facility (“U.K. Revolving Credit Agreement”), which accrues interest at the bank’s base rate plus 3.5% (4.0% as of May 1, 2010), requires interest payments monthly with principal payable on demand and is collateralized by substantially all of the United Kingdom assets of Ben Sherman

 

2,856

 

11.375% Senior Secured Notes (“113/8% Senior Secured Notes”), which accrue interest at an annual rate of 11.375% (effective interest rate of 12%) and require interest payments semi-annually in January and July of each year, require payment of principal at maturity (July 2015), are subject to certain prepayment penalties, are secured by a first priority interest in all U.S. registered trademarks and certain related rights and certain future acquired real property owned in fee simple of Oxford Industries, Inc. and substantially all of its consolidated domestic subsidiaries and a second priority interest in those assets in which the lenders under the U.S. Revolving Credit Agreement have a first priority interest, and are guaranteed by certain of our domestic subsidiaries

 

150,000

 

Unamortized discount

 

(3,428

)

Total debt

 

$

149,428

 

Short-term debt and current maturities of long-term debt

 

(2,856

)

Long-term debt, less current maturities

 

$

146,572

 

 

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Our credit facilities are used to finance trade letters of credit, as well to provide funding for other operating activities, capital expenditures and acquisitions. As of May 1, 2010, approximately $17.0 million of trade letters of credit and other limitations on availability in the aggregate were outstanding against the U.S. Revolving Credit Agreement and the U.K. Revolving Credit Agreement. On May 1, 2010, we had approximately $138.8 million and $10.5 million in unused availability under the U.S. Revolving Credit Agreement and the U.K. Revolving Credit Agreement, respectively, subject to the respective limitations on borrowings set forth in the U.S. Revolving Credit Agreement, U.K. Revolving Credit Agreement and the indenture for the 113/8% Senior Secured Notes.

 

Covenants, Other Restrictions and Prepayment Penalties:

 

Our credit facilities and 113/8% Senior Secured Notes are subject to a number of affirmative covenants, negative covenants, financial covenants and other restrictions as discussed in Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations and Note 5 in our consolidated financial statements, both included in our Annual Report on Form 10-K for fiscal 2009. We believe the affirmative covenants, negative covenants, financial covenants and other restrictions are customary for those included in similar facilities and notes entered into at the time we entered into our agreements. As of May 1, 2010, we were compliant with all covenants related to our credit facilities and 113/8% Senior Secured Notes. If we were to redeem any of our 113/8% Senior Secured Notes prior to July 15, 2014 pursuant to the indenture governing the notes, we would be required to pay certain premiums above the principal amount, which are also discussed in Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations and Note 5 in our consolidated financial statements, both included in our Annual Report on Form 10-K for fiscal 2009.

 

Other Liquidity Items:

 

We anticipate that we will be able to satisfy our ongoing cash requirements, which generally consist of working capital needs, capital expenditures and interest payments on our debt during fiscal 2010, primarily from positive cash flow from operations supplemented by borrowings under our lines of credit, if necessary. Our need for working capital is typically seasonal with the greatest requirements generally existing in the fall and spring of each year. Our capital needs will depend on many factors including our growth rate, the need to finance inventory levels and the success of our various products. At maturity of the U.S. Revolving Credit Agreement and the 113/8% Senior Secured Notes or if the U.K. Revolving Credit Agreement was required to be paid, we anticipate that we will be able to refinance the facilities and debt with terms available in the market at that time, which may or may not be as favorable as the terms of the current agreements.

 

Our contractual obligations as of May 1, 2010 have not changed significantly from the contractual obligations outstanding at January 30, 2010 other than changes in the amounts outstanding under our U.K. Revolving Credit Agreement and pursuant to letters of credit (each as discussed above).

 

Our anticipated capital expenditures for fiscal 2010, including $1.6 million incurred during the first quarter of fiscal 2010, are expected to be approximately $15 million. These expenditures are expected to consist primarily of additional retail stores and costs associated with investment in certain technology initiatives, including the continuing implementation of new integrated financial systems.

 

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Table of Contents

 

Off Balance Sheet Arrangements

 

We have not entered into agreements which meet the SEC’s definition of an off balance sheet financing arrangement, other than operating leases, and have made no financial commitments to or guarantees with respect to any unconsolidated subsidiaries or special purpose entities.

 

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

 

The discussion and analysis of our financial condition and results of operations are based upon our unaudited condensed consolidated financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses and related disclosures of contingent assets and liabilities. On an ongoing basis, we evaluate our estimates, including those related to bad debts, inventories, intangible assets, income taxes, stock compensation expense, contingencies and litigation and certain other accrued expenses. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. Our critical accounting policies and estimates are discussed in Part II, Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for fiscal 2009. There have not been any significant changes to the application of our critical accounting policies and estimates during the first quarter of fiscal 2010.

 

A detailed summary of significant accounting policies is included in Note 1 to our consolidated financial statements contained in our Annual Report on Form 10-K for fiscal 2009.

 

SEASONALITY

 

Although our various product lines are sold on a year-round basis, the demand for specific products or styles may be seasonal. For example, the demand for Tommy Bahama in our principal markets is higher in the spring season. Generally, our wholesale products are sold prior to each of the retail selling seasons, including spring, summer, fall and holiday. As the timing of product shipments and other events affecting the retail business may vary, we do not believe that results for any particular quarter are necessarily indicative of results for the full fiscal year. The following table presents the percentage of net sales and operating income by quarter (unaudited) for fiscal 2009.

 

 

 

First
Quarter

 

Second
Quarter

 

Third
Quarter

 

Fourth
Quarter

 

Net sales

 

27%

 

24%

 

25%

 

24%

 

Operating income

 

33%

 

15%

 

27%

 

25%

 

 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

We are exposed to certain interest rate, foreign currency, commodity and inflation risks as discussed in Part II, Item 7A, Quantitative and Qualitative Disclosures About Market Risk in our Annual Report on Form 10-K for fiscal 2009. There have not been any significant changes in our exposure to these risks during the first quarter of fiscal 2010.

 

ITEM 4.  CONTROLS AND PROCEDURES

 

Our Principal Executive Officer and Principal Financial Officer have evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act) as of the end of the period covered by this report. Based upon that evaluation, our Principal Executive Officer and Principal Financial Officer concluded that, as of the end of the period covered by this report, our disclosure controls and procedures were effective in ensuring that information required to be disclosed by us in our Securities Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Principal Executive Officer and Principal Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

 

There have not been any changes in our internal control over financial reporting (as such term is defined in Rule 13a-15(f) and 15d-15(f) under the Securities Exchange Act) that occurred during the first quarter of fiscal 2010 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

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Table of Contents

 

PART II.  OTHER INFORMATION

 

ITEM 1.  LEGAL PROCEEDINGS

 

In the ordinary course of business, we may become subject to litigation or claims. We are not currently a party to any litigation or regulatory action that we believe could reasonably be expected to have a material adverse effect on our financial position, results of operations or cash flows.

 

ITEM 1A.  RISK FACTORS

 

We believe that an investor should carefully consider the factors discussed in Part I, Item 1A. Risk Factors in our Annual Report on Form 10-K for fiscal 2009, which are not the only risks facing our company. We do not believe there have been any material changes to the risk factors described in our Annual Report on Form 10-K for fiscal 2009. If any of the risks described in such Annual Report, or other risks or uncertainties not currently known to us or that we currently deem to be immaterial, actually occur, our business, financial condition or operating results could suffer.

 

ITEM 2.  UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

 

(a)          During the first quarter of fiscal 2010, we did not make any unregistered sales of our equity securities.

 

(c)          We have certain stock incentive plans as described in Note 7 to our consolidated financial statements included in our Annual Report on Form 10-K for fiscal 2009, all of which are publicly announced plans. Under the plans, we can repurchase shares from employees to cover employee tax liabilities related to the exercise of stock options or the vesting of previously restricted shares.  During the first quarter of fiscal 2010, we repurchased the following shares pursuant to these plans:

 

Fiscal
Month

 

 

Total Number
of Shares
Purchased

 

Average
Price
Paid per
Share

 

Total Number of
Shares
Purchased as
Part of Publicly
Announced
Plans
or Programs

 

Maximum
Number of
Shares
That May Yet be
Purchased
Under
the Plans or
Programs

 

February (01/31/10 - 02/27/10)

 

 

 

 

 

March (02/28/10 - 4/3/10)

 

 

 

 

 

April (4/4/10 - 5/1/10)

 

18,903

 

$21.25

 

 

 

Total

 

18,903

 

$21.25

 

 

 

 

On September 8, 2008, our Board of Directors authorized the repurchase by us of up to 0.5 million shares of our common stock. As of May 1, 2010, no shares had been repurchased pursuant to this authorization, which has no automatic expiration.

 

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

 

None

 

ITEM 4. RESERVED

 

None

 

ITEM 5.  OTHER INFORMATION

 

None

 

23



Table of Contents

 

ITEM 6.  EXHIBITS

 

 

3.1

Restated Articles of Incorporation of Oxford Industries, Inc. Incorporated by reference to Exhibit 3.1 to the Company’s Form 10-Q for the fiscal quarter ended August 29, 2003.

 

3.2

Bylaws of Oxford Industries, Inc., as amended. Incorporated by reference to Exhibit 3.1 to the Company’s Form 8-K filed on June 17, 2009.

 

31.1

Section 302 Certification by Principal Executive Officer.*

 

31.2

Section 302 Certification by Principal Financial Officer.*

 

32

Section 906 Certification by Principal Executive Officer and Principal Financial Officer.*

 


*                               Filed herewith.

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

June 9, 2010

OXFORD INDUSTRIES, INC.

 

 

(Registrant)

 

 

 

 

 

/s/ K. Scott Grassmyer

 

 

K. Scott Grassmyer

 

 

Senior Vice President, Chief Financial Officer and Controller

 

 

(Authorized Signatory)

 

 

24


 

Exhibit 31.1

 

CERTIFICATION

 

I, J. Hicks Lanier, certify that:

 

1.     I have reviewed this report on Form 10-Q of Oxford Industries, Inc.;

 

2.     Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3.     Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

4.     The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

a)              Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

b)             Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

c)              Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

d)             Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

5.     The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

a)              All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

b)             Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

 

Date: June 9, 2010

/s/ J. Hicks Lanier

 

J. Hicks Lanier

 

Chairman and Chief Executive Officer

 


Exhibit 31.2

 

CERTIFICATION

 

I, K. Scott Grassmyer, certify that:

 

1.     I have reviewed this report on Form 10-Q of Oxford Industries, Inc.;

 

2.     Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3.     Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

 

4.     The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

a)              Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

b)             Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

c)              Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

d)             Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

5.     The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

a)              All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

 

b)             Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

 

Date: June 9, 2010

/s/ K. Scott Grassmyer

 

K. Scott Grassmyer

 

Senior Vice President, Chief Financial Officer and Controller

 


Exhibit 32

 

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with the Quarterly Report of Oxford Industries, Inc. (the “Company”) on Form 10-Q (“Form 10-Q”) for the quarter ended May 1, 2010 as filed with the Securities and Exchange Commission on the date hereof, I, J. Hicks Lanier, Chairman and Chief Executive Officer of the Company, and I, K. Scott Grassmyer, Senior Vice President, Chief Financial Officer and Controller of the Company, each certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

 

(1)   The Form 10-Q fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

 

(2)   The information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

 

/s/ J. Hicks Lanier

 

J. Hicks Lanier

 

Chairman and Chief Executive Officer

 

June 9, 2010

 

 

 

 

 

/s/ K. Scott Grassmyer

 

K. Scott Grassmyer

 

Senior Vice President, Chief Financial Officer and Controller

 

June 9, 2010