EXHIBIT 99.2
OXFORD INDUSTRIES, INC.
SUMMARY OF UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS
This unaudited pro forma financial information should be read in conjunction
with the consolidated financial statements and notes of Oxford Industries, Inc.
included in its annual report filed on Form 10-K for the year ended June 3, 2005
and the unaudited condensed consolidated financial statements and notes of
Oxford Industries, Inc. included in its Form 10-Q for the quarter and nine
months ended March 3, 2006.
The following unaudited pro forma condensed consolidated statements of earnings
for the year ended June 3, 2005 (fiscal 2005 year), the quarter ended March 3,
2006 (third quarter of fiscal 2006) and the nine months ended March 3, 2006
(nine months of fiscal 2006) have been prepared to give effect to the
disposition of operations related to our Womenswear Group, which occurred on
June 2, 2006, as if the disposition had occurred on May 28, 2004.
The following unaudited pro forma condensed consolidated balance sheet as of
March 3, 2006 has been prepared to give effect to the disposition of our
Womenswear Group, which occurred on June 2, 2006, as if the disposition had
occurred on March 3, 2006.
These unaudited pro forma condensed consolidated financial statements are
prepared for informational purposes only and are not necessarily indicative of
future results or of actual results that would have been achieved had the
disposition of the Womenswear Group been completed as of the dates specified
above. The amount of proceeds to be received as presented in this pro forma
balance sheet as of March 3, 2006, is not necessarily reflective of the total
anticipated impact on our debt levels due to seasonality differences between
March 3, 2006 and June 2, 2006, and the impact of assets and liabilities related
to the discontinued operations, which will be retained and have not been
included in the proceeds calculation in the pro forma balance sheet as of March
3, 2006. These retained assets and liabilities will impact the amount ultimately
available for the reduction of debt, as they are converted to cash which is
expected to occur within the first quarter after the transaction is completed.
OXFORD INDUSTRIES, INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
FOR THE FISCAL 2005 YEAR
(UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
PRO FORMA
HISTORICAL ADJUSTMENTS PRO FORMA TOTAL
---------- ----------- ---------------
(a) (b)
Net sales $ 1,313,609 $ (256,822) $ 1,056,787
Cost of goods sold 875,355 (219,040) 656,315
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Gross profit 438,254 (37,782) 400,472
Selling, general and administrative expense 336,608 (24,974) (c) 311,634
Amortization of intangible assets 8,978 (356) 8,622
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345,586 (25,330) 320,256
Royalties and other operating income 12,059 - 12,059
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Operating income 104,727 (12,452) 92,275
Interest expense, net 29,147 (3,376) (d) 25,771
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Earnings before income taxes 75,580 (9,076) 66,504
Income taxes 25,753 (3,531) (e) 22,222
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Net earnings from continuing operations 49,827 (5,545) 44,282
====================================================================
Net earnings from continuing operations per
common share:
Basic $ 2.97 $ (0.33) $ 2.64
Diluted $ 2.87 $ (0.32) $ 2.55
Weighted average common shares outstanding:
Basic 16,788 16,788
Dilutive impact of options, earn-out
shares and restricted shares 562 562
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Diluted 17,350 17,350
====================================================================
OXFORD INDUSTRIES, INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
FOR THE THIRD QUARTER OF FISCAL 2006
(UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
PRO FORMA
HISTORICAL ADJUSTMENTS PRO FORMA TOTAL
---------- ----------- ---------------
(f) (b)
Net sales $ 356,088 $ (80,928) $ 275,160
Cost of goods sold 232,624 (66,580) 166,044
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Gross profit 123,464 (14,348) 109,116
Selling, general and administrative expense 95,656 (7,672) (c) 87,984
Amortization of intangible assets 1,853 - 1,853
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97,509 (7,672) 89,837
Royalties and other operating income 3,117 - 3,117
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Operating income 29,072 (6,676) 22,396
Interest expense, net 7,035 (1,163) (d) 5,872
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Earnings before income taxes 22,037 (5,513) 16,524
Income taxes 7,436 (2,145) (e) 5,291
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Net earnings from continuing operations 14,601 (3,368) 11,233
====================================================================
Net earnings from continuing operations per
common share:
Basic $ 0.83 $ (0.19) $ 0.64
Diluted $ 0.82 $ (0.19) $ 0.63
Weighted average common shares outstanding:
Basic 17,533 17,533
Dilutive impact of options, earn-out
shares and restricted shares 235 235
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Diluted 17,768 17,768
====================================================================
OXFORD INDUSTRIES, INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
FOR THE NINE MONTHS OF FISCAL 2006
(UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
PRO FORMA
HISTORICAL ADJUSTMENTS PRO FORMA TOTAL
---------- ----------- ---------------
(f) (b)
Net sales $ 1,027,218 $ (205,680) $ 821,538
Cost of goods sold 676,293 (170,686) 505,607
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Gross profit 350,925 (34,994) 315,931
Selling, general and administrative expense 273,045 (21,561) (c) 251,484
Amortization of intangible assets 5,557 - 5,557
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278,602 (21,561) 257,041
Royalties and other operating income 10,031 - 10,031
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Operating income 82,354 (13,433) 68,921
Interest expense, net 21,240 (3,489) (d) 17,751
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Earnings before income taxes 61,114 (9,944) 51,170
Income taxes 21,622 (3,868) (e) 17,754
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Net earnings from continuing operations 39,492 (6,076) 33,416
====================================================================
Net earnings from continuing operations per
common share:
Basic $ 2.26 $ (0.35) $ 1.91
Diluted $ 2.22 $ (0.34) $ 1.88
Weighted average common shares outstanding:
Basic 17,471 17,471
Dilutive impact of options, earn-out
shares and restricted shares 280 280
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Diluted 17,751 17,751
====================================================================
(a) Historical financial information is derived from Oxford Industries, Inc.'s
annual report filed on Form 10-K as of June 3, 2005.
(b) Represents the respective historical individual line items of the
Womenswear Group's statements of earnings, except as otherwise noted.
(c) Represents selling, general and administrative expense of the Womenswear
Group, but excludes corporate overhead and service costs that have
historically been allocated to the Womenswear Group. Such corporate
overhead and service costs may not necessarily be eliminated as a result of
the disposition of the Womenswear Group.
(d) Represents interest expense that would not have been incurred had the
disposition of the Womenswear Group occurred as of May 28, 2004. It is
assumed that proceeds from the disposition, net of tax would have been used
to repay obligations under Oxford Industries, Inc.'s $280 million U.S.
Secured Revolving Credit Facility. Interest expense is calculated as the
estimated proceeds at May 28, 2004, including the proceeds related to
retained assets and liabilities multiplied by the weighted average interest
rate of 4.5% and 6.2% for fiscal 2005 and fiscal 2006, respectively.
(e) Represents income taxes calculated at the statutory rate that would not
have been incurred had the disposition of the Womenswear Group occurred
as of May 28, 2004.
(f) Historical financial information is derived from Oxford Industries, Inc.'s
quarterly report filed on Form 10-Q as of March 3, 2006.
OXFORD INDUSTRIES, INC.
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEETS
MARCH 3, 2006
(UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
PRO FORMA PRO FORMA
HISTORICAL ADJUSTMENTS TOTAL
---------- ------------- ---------
(a)
ASSETS
Current Assets:
Cash and cash equivalents $ 10,004 $ - $ 10,004
Receivables, net 206,762 (55,403)(b) 151,359
Inventories 166,183 (32,795)(b) 133,388
Prepaid expenses 23,624 (83)(b) 23,541
Current assets related to
discontinued operations - 68,913 68,913
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Total current assets 406,573 (19,368)(b) 387,205
Property, plant and equipment, net 69,698 (787)(b) 68,911
Goodwill, net 185,411 (3,992)(b) 181,419
Intangible assets, net 232,960 - 232,960
Other non-current assets, net 21,179 (4)(b) 21,175
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TOTAL ASSETS $915,821 $ (24,151) $891,670
=======================================================================
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities 146,000 (19,429)(b) 126,571
Current liabilities related to
discontinued operations - 16,544 16,544
Long-term debt, less current maturities 309,530 (32,623)(c) 276,907
Other non-current liabilities 28,440 - 28,440
Deferred income taxes 74,579 - 74,579
Commitments and contingencies - - -
Shareholders' Equity:
Preferred Stock, $1.00 par value;
30,000 authorized and none issued
and outstanding at March 3, 2006 - - -
Common stock, $1.00 par value, 60,000
authorized and 17,613 issued and
outstanding at March 3, 2006 17,613 - 17,613
Additional paid-in capital 72,232 2,377(d) 74,609
Retained earnings 272,938 8,980(e) 281,918
Accumulated other comprehensive (loss)
income (5,511) - (5,511)
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Total shareholders' equity 357,272 11,357 368,629
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TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $915,821 $ (24,151) $891,670
======================================================================
(a) Historical financial information is derived from Oxford Industries, Inc.'s
quarterly report filed on Form 10-Q as of March 3, 2006.
(b) Represents the elimination and reclassification to assets/liabilities
related to discontinued operations of the Womenswear Group's balance
sheet that were assumed sold or retained, respectively, as of March 3,
2006.
(c) Represents the net reduction in debt from the proceeds of the
transaction (without consideration of the retained assets and
liabilities) less the payment of transaction costs, including any
employee related costs and income taxes (at the statutory rate).
(d) Represents the additional paid in capital resulting from the
modification of stock options and restricted stock awards for employees
of the discontinued operations based upon the closing stock price on
March 3, 2006.
(e) Represents the net gain on the transaction after considering
transaction costs and income taxes.