Oxford Industries Inc Q2 2024 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Chandana Madaka - KeyBanc Capital Markets - Analyst : Hi. Thanks for taking my question today. This is Chandana Madaka on for Ashley. So I just wanted to dig into maybe a little bit more about how you're thinking about promotional events going into the back half. Maybe any color you could provide there by brand, just now that they are thinking around promotions a little bit differently? I also wanted to see if you could dig in further for us on what you're hearing from wholesale partners, maybe an update on the order books? Thank you.

Question: Chandana Madaka - KeyBanc Capital Markets - Analyst : Awesome. Thanks. Nice to hear.

Question: Dana Telsey - Telsey Advisory Group - Analyst : Hi. Good afternoon, everyone. As you think about the state of the consumer and what you saw in outlets versus the other channels of distribution with the brands with Tommy with Lilly, what are you seeing that's different? How did the cadence of the quarter go and are there categories that performed better or worse than others and with the promotional environment, how deep are the markdowns and how you're thinking about promotions for Q3 and Q4? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. SEPTEMBER 11, 2024 / 8:30PM, OXM.N - Q2 2024 Oxford Industries Inc Earnings Call

Question: Dana Telsey - Telsey Advisory Group - Analyst : And then just picking apart freight costs, how are you thinking about the puts and takes on margins? K. Scott Grassmyer - Oxford Industries Inc - Chief Financial Officer, Chief Operating Officer, Executive Vice President Yes. We built in about 15 to 20 basis points in margin hit due to elevated freight. So it's not a huge, huge amount. We are watching -- and that's mainly some of the Red Sea issues that have inflated rates. We are seeing -- we are watching closely the East Coast situation with the union negotiations. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. SEPTEMBER 11, 2024 / 8:30PM, OXM.N - Q2 2024 Oxford Industries Inc Earnings Call And are diverting some product to the West Coast and then we'll have to bring it across the country in some cases. So that's something we continue to watch. But we have built in some disruption from that. Obviously, if the East Coast ports do go on strike, that's going to be a disruptor to, I think, everyone.

Question: Mauricio Serna - UBS - Analyst : I guess maybe if you could elaborate a little bit more on the promotional activity across each of three big brands. I know I recall like there was some shift in promotional events in Lilly Pulitzer. But outside of that, like anywhere where you saw, like promotions really surprised you on the negative side? And like just a bit more detail on that would be very helpful. Thank you. K. Scott Grassmyer - Oxford Industries Inc - Chief Financial Officer, Chief Operating Officer, Executive Vice President I would -- Mauricio, I'd say is this more we just had -- we sold through a bit less at full price than we expected, so we had more inventory when we did Tommy's end of the season sale had more inventory than did the prior year, Lilly, Johnny Was. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. SEPTEMBER 11, 2024 / 8:30PM, OXM.N - Q2 2024 Oxford Industries Inc Earnings Call That was more the case. So it just resulted in -- and you had a consumer much more willing to buy during those events. So it wasn't that we had major change in the events or were majorly different on the degree of discounts. It was -- there was just more inventory available that sold. So we've traded some full price sales for off-price sales during typical clearance periods.

Question: Janine Stichter - BTIG - Analyst : So to start out, on the consumer, you went through a whole host of factors that might have contributed to the slowdown. I think you talked about distraction and inflation and merchandising missteps. Maybe just help us rank order in your opinion, which are the most meaningful in terms of the change you've seen in the top line trend? And then within that, we'd love some more context around Florida. It grew a lot in the years after COVID and you're talking about some normalization. Just maybe your thoughts on what inning we're in with the normalization there? And maybe some context on how much it grew post-COVID? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. SEPTEMBER 11, 2024 / 8:30PM, OXM.N - Q2 2024 Oxford Industries Inc Earnings Call

Question: Janine Stichter - BTIG - Analyst : Okay. Great. And then on the merchandising missteps, it sounds like you have a lot of things already in the works, but I just would love to hear your sense of when we should expect to see some improvement there?

Question: Janine Stichter - BTIG - Analyst : All right.. Great. Perfect. Thanks for all the color. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. SEPTEMBER 11, 2024 / 8:30PM, OXM.N - Q2 2024 Oxford Industries Inc Earnings Call

Question: Paul Lejuez - Citigroup - Analyst : Hey, guys. Thanks. Can you talk about which regions were performing this quarter, it sounds like Florida was in line with the chain, but where did you see better results by region and where did you see weaker results? And then can you talk about where each of the brands are in terms of full

Question: Paul Lejuez - Citigroup - Analyst : Got it. How are you thinking about ticket prices? Do they need to be adjusted lower to avoid having to use more discounts to drive sales? Or you prefer to leave them where they are and show the customer that discount as a call to action?

Question: Paul Lejuez - Citigroup - Analyst : Got it. Thank you. Good luck.