Oxford Industries Inc Q3 2024 Earnings Call Transcript

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

Question: Ashley Owens - KeyBanc Capital Markets - Analyst : So you mentioned some improvements to store comps so far in the fourth quarter and holiday being off to a better start. I know you mentioned that outlet continues to track better than full price, but could you just parse that out what you're seeing from a brand perspective in terms of store comps? K. Scott Grassmyer - Oxford Industries Inc - Chief Financial Officer, Chief Operating Officer, Executive Vice President Yes. From a brand perspective, all our brands started the quarter in pretty severe negative territory. And then it seemed about the weekend after the election, we started seeing a recovery. So all our brands, I think, are slightly negative, expect Lilly might be slightly positive right now. But they all are improving. And so the negative comp, which started the first week or so, we were in double digits negative. We are now in the lower single-digit negative range.

Question: Ashley Owens - KeyBanc Capital Markets - Analyst : Okay. Got you. That's helpful. Then just any color on the wholesale order book for resort season, what you're hearing from your specialty and department store partners? And then just as a comparison, can you maybe talk about the magnitude of newness you're anticipating relative to last year? And how much you plan to lean into that aspect of the business, seeing as it has been working really well?

Question: Ethan Saghi - BTIG - Analyst : You got Ethan Saghi on for Janine. First question, just with all the tariff uncertainty out there, it would be helpful to get your thoughts on how the company is currently positioned in terms of sourcing? And what plans you may have in place to mitigate some of the potential headwinds from increased tariffs next year?

Question: Ethan Saghi - BTIG - Analyst : Got it. That's really helpful. And then just a follow-up. So far through the holiday season, just how has the promotional activity been across brands and just in the industry in general compared to your prior expectations?

Question: Mauricio Serna - UBS - Analyst : Great. First, to start, you mentioned one of your focus is to improve operating margins in '25. Maybe could you provide any initial guidepost for margins? And also any color on sales? And also another follow-up on -- could you provide like any math on the Tommy Bahama Marlin Bars in terms of like your contribution to sales so far this year or expectation for this year and going into '25, given what you -- the openings that you've made over the last 12 months or so.

Question: Mauricio Serna - UBS - Analyst : Got it. And then if I may, just on the Q4 gross margin guidance, I think you mentioned you expected flat year-over-year. And I guess that's like an improvement relative to what you have for the full year, 50 to 100 basis points contraction. Just wanted to get a better sense of what is driving that sequential? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. DECEMBER 11, 2024 / 9:30PM, OXM.N - Q3 2024 Oxford Industries Inc Earnings Call K. Scott Grassmyer - Oxford Industries Inc - Chief Financial Officer, Chief Operating Officer, Executive Vice President It will be a little more mix with direct-to-consumer being a higher percent of the mix, so that is certainly helping there. And we've got a lot of new locations coming in. And our inventories going in are -- we believe we're in very good shape. So the level of exiting end of season type merchandise should not be too severe of a marked down.

Question: Paul Lejuez - Citi - Analyst : Curious if you could talk about what percent of your sales occur at full price currently? Like if you look back over this year versus what you might have seen historically. And curious if you see that percentage changing given the consumer environment that you described? And then second, you mentioned outperformance of the outlets, I believe. Is that driven by stronger traffic or stronger conversion or both? Maybe if you could just talk about the different comp metrics of full-price versus factory stores?

Question: Paul Lejuez - Citi - Analyst : Got it. And then I guess just a follow-up on the higher percentage of sales happened during promotional periods, is it that business performed better than you thought during those promotional events? Or is it just a higher mix of sales because sales were weaker during the non-promotional periods?