NYSE-listed apparel retailer, Oxford Industries, Inc. reported rise in net sales of 5% to reach $246.2 million in second fiscal quarter ended August 2, 2014, compared to $235.0 million in the second fiscal quarter of 2013.
On an adjusted basis, earnings per share declined to $0.94 in second quarter of 2014 compared to $1.01 in the second quarter of 2013. On a GAAP basis, earnings per share stood at $0.92 and $0.96 in the second quarters of 2014 and 2013, respectively.
Gross profit for the second quarter of 2014 increased to $145.4 million from $136.8 million in the second quarter of 2013, while gross margin went up to 59.1% from 58.2% in the prior year period.
For the second quarter of 2014, SG&A totalled $122.4 million, or 49.7% of net sales, compared to $112.4 million, or 47.8% of net sales, in the second quarter of 2013.
According to Oxford, the increase in SG&A was primarily due to increased incentive compensation expense, principally at Lilly Pulitzer and incremental costs associated with operating additional retail stores, and investments in infrastructure and systems.
Royalties and other income reached $3.9 million in the second quarter of 2014 versus $3.4 million in the second quarter of 2013, while second quarter of 2014 operating income was down to $26.8 million against $27.7 million in the second quarter of 2013.
In the second quarter of 2014, Oxford said interest expense declined to $0.9 million from $1.0 million in the second quarter of 2013. The effective tax rate for the quarter under review was 41.8% vis-a-vis 40.7% in the same quarter of 2013.
"The rate in both periods was unfavourably impacted by our inability to recognize a tax benefit for losses in foreign jurisdictions, while the rate in fiscal 2013 benefited from a reduction in the enacted tax rate in the U.K", Oxford explained.
Oxford said, inventories at the close of the second quarter of 2014 were $141.3 million, up from $101.9 million at the close of the second quarter of 2013, primarily to support anticipated sales growth within the direct to consumer businesses.
"Inventory levels also increased as a result of the earlier receipt of shipments from suppliers for fall goods and the impact of currency translation", the retailer added.
As of August 2, 2014, Oxford had $108.5 million of aggregate borrowings outstanding and $124.0 million of aggregate unused availability under its revolving credit agreements. Its capital expenditures are expected to be approximately $55 million.
These expenditures consist primarily of costs associated with both new and remodelled retail stores and restaurants.
