Thomas C. Chubb III, chairman and chief executive officer of Oxford Industries, crowed over his company’s second-quarter results — but the U.S.-China trade war also forced the company to moderate its outlook for the year.
“As we move into the second half of 2019, the fundamentals of our business remain strong,” Chubb said. “We continue to focus on executing our growth strategies while working to minimize the impact of additional tariffs on both our consumers and our financial results. While we have revised our outlook for the year to reflect the estimated increase in cost of goods associated with these tariffs on the back half of the year, we are still on track to deliver solid results in 2019 with confidence in the strength of our brands and our talented and dedicated people.”
Oxford is now looking for 2019 earnings of $4.15 to $4.35 a share — down from the $4.42 to $4.62 projected in June.
Since then, President Donald Trump imposed an additional 15 percent tariff on 90 percent of the Chinese apparel imports. More duties are due later this year, but the best hope of avoiding them right now would seem to depend on trade talks between Washington and Beijing that are scheduled for October.
Luckily for Oxford, the company is gaining ground in its full-price business.
“Our second-quarter results continued to demonstrate the strength of our full-price direct-to-consumer businesses,” Chubb said. “For the 10th consecutive quarter we posted consolidated comparable sales growth with comparable sales increasing 3 percent on top of a 7 percent increase in the prior year. The top-line performance of our full-price direct-to-consumer channels was offset by lower wholesale sales and some softness in our outlet store business.”
For the second quarter Aug. 3, net earnings rose to $29.8 million from $27.2 million as sales were relatively flat at $302 million.
Shares of Oxford, the parent company of the Tommy Bahama and Lilly Pulitzer brands, dropped 9 percent in after-hours trading following the release of the results.