Making new 52-week highs this morning, shares of Tommy Bahama-owner Oxford Industries (OXM 71.50, +5.32 +8.0%) react favorably to the mixed Q3 report and updated FY18 guidance.
Simply, Q3 earnings of $0.17 per share came in ahead of market expectations and revenue growth of 6.2% to $235.96 million wasn’t enough to meet market expectations. Overall, gross margins were up 60 basis points to 53.7%. In the Tommy Bahama and Lilly Pulitzer brands, Q3 comparable store sales were 5% and (1%), respectively.
As a caveat, OXM estimates Hurricanes Harvey and Irma resulted in lost sales and earnings per share of about $2 million and $0.05, respectively.
Breaking it down a bit further, the smaller Lilly Pulitzer and Lanier Apparel brands performed the best in the quarter as it relates to net sales growth. At LP, net sales were up 13.2% to $59.2 million in Q3. LA was net sales growth of 22.9% to about $43.1 million while Southern Tide grew 6.1% to $9.2 million and Corporate and Other net sales amounted to only $0.5 million.
The company’s largest segment, Tommy Bahama, saw net sales dip 1.6% compared to a year ago to about $123.9 million on gross margins of 60.0% vs 58.7% last year.
Further, compounding the strong sales results OXM kept its inventory in check – specifically, inventory in the quarter declined 7% to $127.3 million.
As for guidance, OXM now expects FY18 earnings of $3.55-3.70 from previous $3.50-3.70 on revenues of $1.08-1.095 billion from $1.085-1.105 billion.
In reaction to earnings and guidance, OXM adds to its recent gains of about 14% -- stopping just short of the $74 level. At one point this morning, OXM held YTD gains of about 21% compared to gains out of the Retails SPDR – XRT +1.4% during the same period.