NEW YORK — Cost cuts offset an expected sales decline to allow Oxford Industries Inc. to record bottom-line gains during its first quarter.
This story first appeared in the September 26, 2002 issue of WWD. Subscribe Today.
For the three months ended Aug. 30, the Atlanta-based apparel manufacturer recorded a 44.2 percent jump in net income to $4.5 million, or 60 cents a diluted share. That compares with last year’s profits of $3.1 million, or 42 cents.
Sales for the period declined 4.1 percent to $172.1 million from $179.5 million a year ago.
“We are gratified to see the dramatic improvement in our profitability in the first quarter,” said chairman J. Hicks Lanier in a statement. “Our efforts to aggressively manage inventory and improve sourcing have been key to our improving financial results. Better sourcing and more efficient manufacturing have led to a 210-basis-point increase in our gross margin.”
Oxford attributed the sales decline primarily to the discontinuation of its DKNY Kids business, and said it was in line with expectations.
While sales at its three men’s wear units declined, women’s wear sales advanced 7 percent, to $66.6 million from $62.2 million in the year-ago quarter. Growth among mass merchant customers generated most of the sales increase, which elevated women’s wear share of corporate volume to 38.7 percent of sales.
However, operating income in the women’s unit fell 12.3 percent to $3.5 million from $4 million last year because of gross margin erosion.
By segment, sales at Oxford Slacks fell 2.9 percent to $21.4 million from $22 million a year ago, the shirt group saw revenue decline 13.4 percent to $47.2 million from $54.5 million, principally because of the exit from the DKNY Kids business, and Lanier Clothes had a 9.3 percent sales decrease to $36.9 million from $40.7 million.