Oxford Industries (OXM) 10-Q 7 Jun 17 2017 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Apr. 29, 2017	Jun. 02, 2017
Document and Entity Information
Entity Registrant Name	OXFORD INDUSTRIES INC
Entity Central Index Key	75,288
Current Fiscal Year End Date	--02-03
Entity Filer Category	Large Accelerated Filer
Document Type	10-Q
Document Period End Date	Apr. 29, 2017
Document Fiscal Year Focus	2,017
Document Fiscal Period Focus	Q1
Amendment Flag	false
Entity Common Stock, Shares Outstanding		16,810,871

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) - USD ($) $ in Thousands	Apr. 29, 2017	Jan. 28, 2017	Apr. 30, 2016
Current Assets
Cash and cash equivalents	$ 6,554	$ 6,332	$ 6,974
Receivables, net	79,042	58,279	81,493
Inventories, net	127,061	142,175	143,641
Prepaid expenses	24,325	24,842	23,442
Total Current Assets	236,982	231,628	255,550
Property and equipment, net	192,734	193,931	185,971
Intangible assets, net	174,603	175,245	185,416
Goodwill	60,002	60,015	50,058
Other non-current assets, net	24,258	24,340	21,800
Total Assets	688,579	685,159	698,795
Current Liabilities
Accounts payable	63,982	76,825	62,497
Accrued compensation	16,593	19,711	14,948
Other accrued expenses and liabilities	35,591	32,000	31,925
Liabilities related to discontinued operations	3,143	2,860	0
Total Current Liabilities	119,309	131,396	109,370
Long-term debt	93,289	91,509	152,905
Other non-current liabilities	69,370	70,002	67,551
Deferred taxes	16,183	13,578	12,323
Liabilities related to discontinued operations	2,022	2,544	4,278
Commitments and contingencies
Shareholders’ Equity
Common stock, $1.00 par value per share	16,821	16,769	16,757
Additional paid-in capital	131,011	131,144	125,662
Retained earnings	246,136	233,493	214,798
Accumulated other comprehensive loss	(5,562)	(5,276)	(4,849)
Total Shareholders’ Equity	388,406	376,130	352,368
Total Liabilities and Shareholders’ Equity	$ 688,579	$ 685,159	$ 698,795

CONDENSED CONSOLIDATED BALANCE3

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Parenthetical) - $ / shares	Apr. 29, 2017	Jan. 28, 2017	Apr. 30, 2016
Statement of Financial Position [Abstract]
Common stock, par value (in dollars per share)	$ 1	$ 1	$ 1

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Apr. 29, 2017	Apr. 30, 2016
Income Statement [Abstract]
Net sales	$ 272,363	$ 256,235
Cost of goods sold	112,953	104,771
Gross profit	159,410	151,464
SG&A	133,191	123,498
Royalties and other operating income	3,740	4,040
Operating income	29,959	32,006
Interest expense, net	930	614
Earnings from continuing operations before income taxes	29,029	31,392
Income taxes	11,832	11,215
Net earnings from continuing operations	17,197	20,177
Earnings from discontinued operations, net of taxes	0	0
Net earnings	$ 17,197	$ 20,177
Net earnings from continuing operations per share:
Basic (in dollars per share)	$ 1.04	$ 1.22
Diluted (in dollars per share)	1.03	1.21
Earnings from discontinued operations, net of taxes, per share:
Basic (in dollars per share)	0	0
Diluted (in dollars per share)	0	0
Net earnings per share:
Basic (in dollars per share)	1.04	1.22
Diluted (in dollars per share)	$ 1.03	$ 1.21
Weighted average shares outstanding:
Basic (in shares)	16,549	16,503
Diluted (in shares)	16,695	16,617
Dividends declared per share (in dollars per share)	$ 0.27	$ 0.27

CONDENSED CONSOLIDATED STATEME5

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED) - USD ($) $ in Thousands	3 Months Ended
	Apr. 29, 2017	Apr. 30, 2016
Statement of Comprehensive Income [Abstract]
Net earnings	$ 17,197	$ 20,177
Other comprehensive income (loss), net of taxes:
Net foreign currency translation adjustment	(286)	1,980
Total other comprehensive (loss) income, net of taxes	(286)	1,980
Comprehensive income	$ 16,911	$ 22,157

CONDENSED CONSOLIDATED STATEME6

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) $ in Thousands	3 Months Ended
	Apr. 29, 2017	Apr. 30, 2016
Cash Flows From Operating Activities:
Net earnings	$ 17,197	$ 20,177
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation	9,651	9,464
Amortization of intangible assets	539	490
Equity compensation expense	1,739	1,575
Amortization of deferred financing costs	105	96
Deferred income taxes	2,605	4,688
Changes in working capital, net of acquisitions and dispositions:
Receivables, net	(20,474)	(16,562)
Inventories, net	15,000	2,767
Prepaid expenses	508	(375)
Current liabilities	(12,171)	(20,081)
Other non-current assets, net	7	(515)
Other non-current liabilities	(1,095)	(27)
Cash provided by operating activities	13,611	1,697
Cash Flows From Investing Activities:
Acquisitions, net of cash acquired	(225)	(91,871)
Purchases of property and equipment	(8,545)	(10,582)
Other investing activities	0	(2,030)
Cash used in investing activities	(8,770)	(104,483)
Cash Flows From Financing Activities:
Repayment of revolving credit arrangements	(67,373)	(60,642)
Proceeds from revolving credit arrangements	69,153	169,572
Proceeds from issuance of common stock	386	315
Repurchase of equity awards for employee tax withholding liabilities	(2,206)	(1,549)
Cash dividends declared and paid	(4,552)	(4,531)
Cash (used in) provided by financing activities	(4,592)	103,165
Net change in cash and cash equivalents	249	379
Effect of foreign currency translation on cash and cash equivalents	(27)	272
Cash and cash equivalents at the beginning of year	6,332	6,323
Cash and cash equivalents at the end of the period	6,554	6,974
Supplemental disclosure of cash flow information:
Cash paid for interest, net	876	416
Cash paid for income taxes	$ 833	$ 3,438

Basis of Presentation_

Basis of Presentation:	3 Months Ended
	Apr. 29, 2017
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of Presentation:	Basis of Presentation: The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with 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 GAAP for complete financial statements. 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 dates 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 significant 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 2016 . Unless otherwise indicated, all references to assets, liabilities, revenues and expenses in these financial statements reflect continuing operations and exclude any amounts related to our former Ben Sherman operating group, which is classified as discontinued operations for all periods presented. In order to conform to current period classification, certain gift with purchase amounts totaling $0.7 million previously reported as SG&A have been reclassified to cost of goods sold for the First Quarter of Fiscal 2016 . This reclassification resulted in a decrease in SG&A and a corresponding increase in cost of goods sold in the First Quarter of Fiscal 2016 , with no impact on previously reported net earnings. Recently Issued Accounting Standards Applicable to Future Periods In May 2014, the FASB issued guidance which provides a single, comprehensive accounting model for revenue arising from contracts with customers. This guidance has been revised and clarified through supplemental adoption guidance subsequent to May 2014. This new revenue recognition guidance supersedes most of the existing revenue recognition guidance which specifies that revenue is recognized when risks and rewards transfer to a customer. Under the new guidance, revenue will be recognized pursuant to a five-step approach: (1) identify the contracts with the customer; (2) identify the separate performance obligations in the contracts; (3) determine the transaction price; (4) allocate the transaction price to separate performance obligations; and (5) recognize revenue when, or as, each performance obligation is satisfied. The new guidance also requires additional disclosures about the nature, timing and uncertainty of revenue and cash flow arising from customer contracts, including significant judgments and changes in judgments. The new guidance is effective for us beginning in Fiscal 2018, and may be applied via the full retrospective method to all prior periods presented or through the modified retrospective method as a cumulative adjustment to the opening retained earnings balance at the date of initial adoption. We have not finalized our determination of our adoption method. We have initiated a review of our revenue streams including retail, e-commerce, wholesale and royalty income to evaluate the impact of the adoption of the revised guidance on our consolidated financial statements, but have not completed the assessment of the impact of adopting the new guidance on our consolidated financial statements. In February 2016, the FASB issued a new accounting standard on leasing. The new standard will require companies to record most leases as assets and liabilities on the balance sheet. For these leases, we will be required to recognize a right to use asset and lease liability for the obligation created by the leases. This guidance will be effective in Fiscal 2019 with early adoption permitted. The guidance requires the use of the modified retrospective transition approach. We are in the process of evaluating the impact of the new guidance on our consolidated financial statements, but considering our in-place operating leases, we anticipate that the new lease guidance will have a significant impact on our consolidated balance sheet for the recognition of lease-related assets and liabilities. In June 2016, the FASB issued revised guidance on the measurement of credit losses on financial instruments, which amends the impairment model by requiring companies to use a forward-looking approach based on expected losses to estimate credit losses on certain financial instruments, including trade receivables. This guidance will be effective in Fiscal 2020 with early adoption permitted. We are currently assessing the impact that adopting this guidance will have on our consolidated financial statements. In October 2016, the FASB issued revised guidance on the recognition of current and deferred income taxes for intra-entity asset transfers. The revised guidance requires an entity to recognize the income tax consequences of an intra-entity transfer of an asset (other than inventory) when the transfer occurs. This guidance will be effective in Fiscal 2018 with early adoption permitted. The guidance requires the use of the modified retrospective method of adoption which results in a cumulative adjustment to retained earnings as of the beginning of the period of adoption. We are currently assessing the impact that adopting the guidance will have on our consolidated financial statements. In January 2017, the FASB issued revised guidance on the subsequent measurement of goodwill by eliminating the second step from the quantitative goodwill impairment test. The single quantitative step test requires companies to compare the fair value of a reporting unit with its carrying amount and record an impairment charge for the amount that the carrying amount exceeds the fair value, up to the total amount of goodwill allocated to that reporting unit. This guidance will be effective in 2020 with early adoption permitted for goodwill impairment testing dates after January 1, 2017. In January 2017, the FASB issued new guidance that provides a more narrow framework to be used in evaluating whether a set of assets and activities constitute a business. The guidance will be effective in Fiscal 2018 with early adoption permitted. We expect that we will apply this guidance to any future business combination. The impact on our consolidated financial statements will depend on the facts and circumstances of any specific future transactions.

Operating Group Information_

Operating Group Information:	3 Months Ended
	Apr. 29, 2017
Segment Reporting [Abstract]
Operating Group Information:	Operating Group Information: Our business is primarily operated through our Tommy Bahama, Lilly Pulitzer, Lanier Apparel and Southern Tide operating groups. We acquired Southern Tide on April 19, 2016. 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. Our operating group structure reflects a brand-focused management approach, emphasizing operational coordination and resource allocation across each brand's direct to consumer, wholesale and licensing operations, as applicable. Tommy Bahama, Lilly Pulitzer and Southern Tide each design, source, market and distribute apparel and related products bearing their respective trademarks and also license their trademarks for other product categories, while Lanier Apparel designs, sources and distributes branded and private label men's tailored clothing, sportswear and other products. Corporate and Other is a reconciling category for reporting purposes and includes our corporate offices, substantially all financing activities, elimination of inter-segment sales, LIFO accounting adjustments for inventory, other costs that are not allocated to the operating groups and operations of our other businesses which are not included in our operating groups, including our Lyons, Georgia distribution center operations. Our LIFO inventory pool does not correspond to our operating group definitions; therefore, LIFO accounting adjustments are not allocated to our operating groups. For a more extensive description of our Tommy Bahama, Lilly Pulitzer, Lanier Apparel and Southern Tide operating groups see Part I, Item 1. Business included in our Annual Report on Form 10-K for Fiscal 2016. The table below presents certain financial information (in thousands) about our operating groups, as well as Corporate and Other. First Quarter Fiscal 2017 First Quarter Fiscal 2016 Net sales Tommy Bahama $ 172,496 $ 162,719 Lilly Pulitzer 63,343 64,734 Lanier Apparel 23,356 26,611 Southern Tide 12,642 1,425 Corporate and Other 526 746 Total net sales $ 272,363 $ 256,235 Depreciation and amortization Tommy Bahama $ 7,574 $ 7,705 Lilly Pulitzer 1,995 1,728 Lanier Apparel 148 94 Southern Tide 106 57 Corporate and Other 367 370 Total depreciation and amortization $ 10,190 $ 9,954 Operating income (loss) Tommy Bahama $ 16,038 $ 13,318 Lilly Pulitzer 17,687 20,794 Lanier Apparel 858 2,865 Southern Tide 2,104 48 Corporate and Other (6,728 ) (5,019 ) Total operating income $ 29,959 $ 32,006 Interest expense, net 930 614 Earnings from continuing operations before income taxes $ 29,029 $ 31,392

Accumulated Other Comprehensive

Accumulated Other Comprehensive Loss:	3 Months Ended
	Apr. 29, 2017
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]
Accumulated Other Comprehensive Loss:	Accumulated Other Comprehensive Loss: Substantially all amounts included in accumulated other comprehensive (loss) income, as well as the change in the balance, for each period presented, reflect the net foreign currency translation adjustment related to our Tommy Bahama operations in Canada, Japan and Australia. No amounts of accumulated other comprehensive loss were reclassified from accumulated other comprehensive loss into our consolidated statements of operations during any period presented. The following table details the changes in our accumulated other comprehensive loss (in thousands), net of related income taxes, for the periods specified: First Quarter Fiscal 2017 First Quarter Fiscal 2016 Beginning balance $ (5,276 ) $ (6,829 ) Net foreign currency translation adjustment (286 ) 1,980 Ending balance $ (5,562 ) $ (4,849 )

Income Taxes_

Income Taxes:	3 Months Ended
	Apr. 29, 2017
Income Tax Disclosure [Abstract]
Income Taxes:	Income Taxes: Income taxes reflects effective tax rates of 40.8% and 35.7% for the First Quarter of Fiscal 2017 and the First Quarter of Fiscal 2016 , respectively. The effective tax rate for the First Quarter of Fiscal 2017 was unfavorably impacted primarily by the $0.8 million unfavorable tax expense impact of certain stock awards that vested during the period, which had a higher grant date fair value for accounting purposes than the vesting date fair value for tax deduction purposes. In addition, the effective tax rate for the First Quarter of Fiscal 2016 was favorably impacted by the utilization of certain foreign operating loss carryforward amounts and the additional tax benefit of certain stock awards that vested during the First Quarter of Fiscal 2016.

Basis of Presentation_ (Policie

Basis of Presentation: (Policies)	3 Months Ended
	Apr. 29, 2017
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Recently Issued Accounting Standards Applicable to Future Periods	Recently Issued Accounting Standards Applicable to Future Periods In May 2014, the FASB issued guidance which provides a single, comprehensive accounting model for revenue arising from contracts with customers. This guidance has been revised and clarified through supplemental adoption guidance subsequent to May 2014. This new revenue recognition guidance supersedes most of the existing revenue recognition guidance which specifies that revenue is recognized when risks and rewards transfer to a customer. Under the new guidance, revenue will be recognized pursuant to a five-step approach: (1) identify the contracts with the customer; (2) identify the separate performance obligations in the contracts; (3) determine the transaction price; (4) allocate the transaction price to separate performance obligations; and (5) recognize revenue when, or as, each performance obligation is satisfied. The new guidance also requires additional disclosures about the nature, timing and uncertainty of revenue and cash flow arising from customer contracts, including significant judgments and changes in judgments. The new guidance is effective for us beginning in Fiscal 2018, and may be applied via the full retrospective method to all prior periods presented or through the modified retrospective method as a cumulative adjustment to the opening retained earnings balance at the date of initial adoption. We have not finalized our determination of our adoption method. We have initiated a review of our revenue streams including retail, e-commerce, wholesale and royalty income to evaluate the impact of the adoption of the revised guidance on our consolidated financial statements, but have not completed the assessment of the impact of adopting the new guidance on our consolidated financial statements. In February 2016, the FASB issued a new accounting standard on leasing. The new standard will require companies to record most leases as assets and liabilities on the balance sheet. For these leases, we will be required to recognize a right to use asset and lease liability for the obligation created by the leases. This guidance will be effective in Fiscal 2019 with early adoption permitted. The guidance requires the use of the modified retrospective transition approach. We are in the process of evaluating the impact of the new guidance on our consolidated financial statements, but considering our in-place operating leases, we anticipate that the new lease guidance will have a significant impact on our consolidated balance sheet for the recognition of lease-related assets and liabilities. In June 2016, the FASB issued revised guidance on the measurement of credit losses on financial instruments, which amends the impairment model by requiring companies to use a forward-looking approach based on expected losses to estimate credit losses on certain financial instruments, including trade receivables. This guidance will be effective in Fiscal 2020 with early adoption permitted. We are currently assessing the impact that adopting this guidance will have on our consolidated financial statements. In October 2016, the FASB issued revised guidance on the recognition of current and deferred income taxes for intra-entity asset transfers. The revised guidance requires an entity to recognize the income tax consequences of an intra-entity transfer of an asset (other than inventory) when the transfer occurs. This guidance will be effective in Fiscal 2018 with early adoption permitted. The guidance requires the use of the modified retrospective method of adoption which results in a cumulative adjustment to retained earnings as of the beginning of the period of adoption. We are currently assessing the impact that adopting the guidance will have on our consolidated financial statements. In January 2017, the FASB issued revised guidance on the subsequent measurement of goodwill by eliminating the second step from the quantitative goodwill impairment test. The single quantitative step test requires companies to compare the fair value of a reporting unit with its carrying amount and record an impairment charge for the amount that the carrying amount exceeds the fair value, up to the total amount of goodwill allocated to that reporting unit. This guidance will be effective in 2020 with early adoption permitted for goodwill impairment testing dates after January 1, 2017. In January 2017, the FASB issued new guidance that provides a more narrow framework to be used in evaluating whether a set of assets and activities constitute a business. The guidance will be effective in Fiscal 2018 with early adoption permitted. We expect that we will apply this guidance to any future business combination. The impact on our consolidated financial statements will depend on the facts and circumstances of any specific future transactions.

Operating Group Information_ (T

Operating Group Information: (Tables)	3 Months Ended
	Apr. 29, 2017
Segment Reporting [Abstract]
Schedule of information pertaining to the operating groups	The table below presents certain financial information (in thousands) about our operating groups, as well as Corporate and Other. First Quarter Fiscal 2017 First Quarter Fiscal 2016 Net sales Tommy Bahama $ 172,496 $ 162,719 Lilly Pulitzer 63,343 64,734 Lanier Apparel 23,356 26,611 Southern Tide 12,642 1,425 Corporate and Other 526 746 Total net sales $ 272,363 $ 256,235 Depreciation and amortization Tommy Bahama $ 7,574 $ 7,705 Lilly Pulitzer 1,995 1,728 Lanier Apparel 148 94 Southern Tide 106 57 Corporate and Other 367 370 Total depreciation and amortization $ 10,190 $ 9,954 Operating income (loss) Tommy Bahama $ 16,038 $ 13,318 Lilly Pulitzer 17,687 20,794 Lanier Apparel 858 2,865 Southern Tide 2,104 48 Corporate and Other (6,728 ) (5,019 ) Total operating income $ 29,959 $ 32,006 Interest expense, net 930 614 Earnings from continuing operations before income taxes $ 29,029 $ 31,392

Accumulated Other Comprehensi13

Accumulated Other Comprehensive Loss: (Tables)	3 Months Ended
	Apr. 29, 2017
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]
Schedule of changes in the entity's accumulated other comprehensive loss by component, net of related income taxes	The following table details the changes in our accumulated other comprehensive loss (in thousands), net of related income taxes, for the periods specified: First Quarter Fiscal 2017 First Quarter Fiscal 2016 Beginning balance $ (5,276 ) $ (6,829 ) Net foreign currency translation adjustment (286 ) 1,980 Ending balance $ (5,562 ) $ (4,849 )

Basis of Presentation_ (Details

Basis of Presentation: (Details) $ in Millions	3 Months Ended
	Apr. 30, 2016USD ($)
Selling, General and Administrative Expenses
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Prior period reclassification adjustment	$ 0.7
Cost of Goods Sold
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Prior period reclassification adjustment	$ (0.7)

Operating Group Information_ (D

Operating Group Information: (Details) - USD ($) $ in Thousands	3 Months Ended
	Apr. 29, 2017	Apr. 30, 2016
Operating group information
Net sales	$ 272,363	$ 256,235
Depreciation and amortization	10,190	9,954
Operating income (loss)	29,959	32,006
Earnings from continuing operations before income taxes	29,029	31,392
Corporate and Other
Operating group information
Net sales	526	746
Depreciation and amortization	367	370
Operating income (loss)	(6,728)	(5,019)
Tommy Bahama | Operating Groups
Operating group information
Net sales	172,496	162,719
Depreciation and amortization	7,574	7,705
Operating income (loss)	16,038	13,318
Lilly Pulitzer | Operating Groups
Operating group information
Net sales	63,343	64,734
Depreciation and amortization	1,995	1,728
Operating income (loss)	17,687	20,794
Lanier Apparel | Operating Groups
Operating group information
Net sales	23,356	26,611
Depreciation and amortization	148	94
Operating income (loss)	858	2,865
Southern Tide | Operating Groups
Operating group information
Net sales	12,642	1,425
Depreciation and amortization	106	57
Operating income (loss)	$ 2,104	$ 48

Accumulated Other Comprehensi16

Accumulated Other Comprehensive Loss: (Details) - USD ($) $ in Thousands	3 Months Ended
	Apr. 29, 2017	Apr. 30, 2016
Changes in the entity's accumulated other comprehensive loss by component, net of related income taxes
Beginning balance	$ (5,276)	$ (6,829)
Net foreign currency translation adjustment	(286)	1,980
Ending balance	$ (5,562)	$ (4,849)

Income Taxes_ (Details)

Income Taxes: (Details) - USD ($) $ in Millions	3 Months Ended
	Apr. 29, 2017	Apr. 30, 2016
Income Tax Disclosure [Abstract]
Effective income tax rate, percent	40.80%	35.70%
Employee service share-based compensation, tax expense	$ 0.8