Demand for Tommy Bahama product remains strong in Q2
Oxford Industries, Inc. announced financial results for its fiscal 2010 second quarter, which ended July 31, 2010. Consolidated net sales were $186.5 million in the second quarter of fiscal 2010 compared to $192.9 million in the second quarter of fiscal 2009. Last year's sales included $13.4 million of sales from businesses the Company has exited. Diluted net earnings per share were $0.44, exceeding both the Company's previously issued guidance of $0.30-$0.35 and a loss of $0.01 per share in the second quarter of fiscal 2009.
The Company noted that the second quarter of fiscal 2010 included $1.0 million, or $0.04 per share, of LIFO accounting charges compared to $4.0 million, or $0.17 per share, of LIFO accounting charges in the second quarter of fiscal 2009. In the second quarter of fiscal 2009, the Company also incurred $1.4 million, or $0.06 per share, of restructuring charges at Ben Sherman and $1.8 million, or $0.07 per share, related to the write off of unamortized deferred financing costs associated with the retirement of its senior unsecured notes in June 2009.
J. Hicks Lanier, Chairman and Chief Executive Officer, commented, "We were pleased that demand for our Tommy Bahama product remained strong in the second quarter. Both comparable store sales and e-commerce sales delivered healthy increases over the prior year and our wholesale order bookings for the second half of fiscal 2010 are strong. Our efforts to refocus the Ben Sherman business continue to pay off as we saw a significant improvement in its operating performance. Our heritage groups, Lanier Clothes and Oxford Apparel, both posted gratifying results once again. We're pleased that this translated into earnings per share of $0.44 in the quarter."
Mr. Lanier concluded, "We will continue to focus on the efficiency of our operations and on carefully selected sales growth opportunities. We are also committed to maintaining a strong balance sheet and preserving the full range of our strategic alternatives as we position our business to capture additional value for our shareholders."
Tommy Bahama reported net sales of $99.3 million for the second quarter of fiscal 2010 compared to $94.4 million in the second quarter of fiscal 2009. The increase in net sales for Tommy Bahama was primarily due to increases in comparable store sales and higher e-commerce sales. Tommy Bahama's operating income for the second quarter was $14.2 million compared to $13.4 million in the second quarter of fiscal 2009. The increase in operating income was primarily due to the increased net sales, improved gross margins due to a greater proportion of direct to consumer sales as a percentage of total Tommy Bahama sales and higher royalty income. These increases were partially offset by increased SG&A. At the end of the second quarter, Tommy Bahama operated 86 retail stores compared to 84 on August 1, 2009.
Ben Sherman reported net sales of $18.3 million for the second quarter of fiscal 2010 compared to $23.6 million in the second quarter of fiscal 2009. For the quarter, Ben Sherman benefited from an increase in comparable store sales in its retail business and increases in wholesale sales of its men's sportswear business. These increases were offset by a $5.4 million reduction in sales in kids', footwear and women's, all of which Ben Sherman decided to exit last year. Kids' and footwear were subsequently licensed to third parties. Reported sales at Ben Sherman reflect a 6.3% decrease in the average exchange rate of the British pound sterling versus the United States dollar, which had a $1.2 million negative impact.