Oxford Industries, Inc.

Greetings. Welcome to the Oxford Industries Inc. First Quarter Fiscal 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note this conference is being recorded. I'll now turn the conference over to your host, Jevin Strasser. You may begin.

Thank you and good afternoon. Before we begin, I would like to remind participants that certain statements made on today's call and in the Q&A session may constitute forward-looking statements within the meaning of the federal securities laws. Forward-looking statements are not guarantees, and actual results may differ materially from those expressed or implied in the forward-looking statements. Important factors that could cause actual results of operations or our financial condition to differ are discussed in our press release issued earlier today and in documents filed by us with the SEC, including the risk factors contained in our Form 10-K. We undertake no duty to update any forward-looking statements. During this call, we will be discussing certain non-GAAP financial measures. You can find a reconciliation of non-GAAP to GAAP financial measures in our press release issued earlier today, which is posted under the investor relations tab of our website at OxfordInc.com. And now, I'd like to introduce today's call participants. With me today are Tom Chubb, Chairman and CEO, and Scott Grassmeyer, CFO and COO. Thank you for your attention, and now I'd like to turn the call over to Tom Chubb.

Good afternoon, and thank you for joining us. We are pleased to be reporting an incredibly strong start to fiscal 2022. Scott will provide additional detail in a moment, but here are some of the highlights. Before I jump in, I want to pause to thank our incredible team for all that they do. Five consecutive quarters of record earnings do not happen on their own. Each of our happy, upbeat lifestyle brands, Tommy Bahama and Lilly Pulitzer, as well as Southern Tide, the Beaufort Bonnet Company, and Duckhead, which comprise our newly designated emerging brands group, achieved exceptional results in the first quarter of 2022. All three operating groups posted strong sales and operating profit growth over 2021. On an adjusted basis, our consolidated first quarter sales of $353 million, operating margin of 22%, an EPS of $3.50, which was an 85% increase over last year's record first quarter EPS of $1.89, all outperformed expectations. While a terrific quarter for all, the biggest contributor to our record earnings was the performance of our largest brand, Tommy Bahama, where sales grew 46% versus 2021, to $228 million and adjusted operating margin increased by nearly 1,000 basis points to 23%. We continue to focus on the execution of our strategic priorities that I laid out at the beginning of the year, which drive both our performance to date and optimism for the future. Our brands are at the core of our business and we remain acutely focused on brand positioning and voice to remain true to who we are. While each brand has a unique DNA, inspiring optimism and aspirations for happiness is paramount across the portfolio. This can be seen particularly through enhanced creative and digital marketing efforts, which are driving tremendous success. The effectiveness of our marketing efforts can be further evidenced by the 2.2 million active customers we had at the end of the quarter, an increase of over 20% relative to pre-pandemic levels. In addition to our relentless focus on the health of our brands, delivering A-plus product, A-plus distribution, and A-plus communications, continues to further drive our performance. From a product perspective, we are rolling out new offerings to capitalize on consumers' return to social events, leisure travel, and even the more casually attired post-pandemic physical workplace. Tommy Bahama is winning and gaining share through women's apparel. The category continues to grow faster than even our men's business, with particular strength in dresses and swims. The St. Lucia and Diamond Clip Jacquard tier dresses brought newness alongside the continued strength in the two-palm ruffle linen hero franchise. Further, we cater to the continued easy-to-wear trend through innovative fabrications that like the Island Zone franchise's Aubrey performance fabric, which has established itself as a platform fabric. In the men's line, we have also leaned into performance-oriented styles with the Island Zone collection comprising approximately one-third of Tommy Bahama men's business, including the Palm Coast polo and the chip shot and new on-par shorts. At Lilly Pulitzer, we are leaning into one of the brand's long-term competitive advantages and winning in the social dressing category, as weddings and special events are back in full swing. These categories are driving business towards higher price tiers, such as the poly midi dress, an especially popular event piece. We also play to the trend towards linen, with continued innovation, introducing the light and airy machine-washable Lagoon linen. Also, our Luxletic activewear collection continues to grow on the foundation of fabric platforms such as the Merrill nylon and Fairway performance twill. On the distribution front, our mix among our brands continues to shift towards higher margin direct-to-consumer channels, which comprise a larger portion of our total revenue than they did prior to the pandemic. While direct-to-consumer continues to grow at a faster pace and is by far the largest part of our business, our wholesale business is very healthy and poised to grow at a modest rate over the coming years. We have outstanding wholesale partners with whom we are aligned on how to present and sell our wonderful brands. This enables us to have a wholesale business which is mutually profitable for both us and the retailer and exhibits our brands in an elevated way to consumers who we might otherwise not reach. Our retail footprint continues to expand as well. In April, we enhanced Lily Pelletier's presence in the southeast with the opening of a new location in Alpharetta, Georgia's Avalon community. In May, we were delighted to open our second, the Beaufort Bonnet Company Store in Kiowa Island and a new Southern Tide store in Cary, North Carolina's recently launched Fenton Project. We continue to invest in our premium bricks and mortar footprint with leases secured for two additional Southern Tide stores in Florida and a new Lilly Pelletzer store in Charlottesville, Virginia, slated to open later this year. On top of that, we will continue to build on the success of the Marlin Bar concept with committed deals in Palm Beach Gardens and Winter Park, Florida, slated for fiscal 23 openings and others in the pipeline. In order to maintain our competitive advantage in communications in a rapidly changing media environment, we continue to invest in people, processes, and systems. We are focused on improving our capabilities to identify prospective audiences, connect with our existing customer base, deliver targeted messages, and assess and refine these efforts to attract new customers, retain our existing customers, and increase overall spending. We have made much progress in this area over the last several years and are excited about the projects that we have underway to continue to enhance these capabilities. From a creative standpoint, we are very focused on creating aspirational messages that evoke an I want to be there wearing that product moment for our customers. A look back at some of the recent messaging we have had at Tommy Bahama provides some excellent examples of how we are doing this, particularly with regard to our female customers. Female customers are responsible for buying more than half of all the men's products and substantially all of the women's product that we sell. Our increasing effectiveness in reaching these female shoppers in Tommy, Bahama is a large part of our recent success. We also continue to invest in our omni-channel capabilities. The ship-from-store capability that we went live with in Tommy, Bahama during the third quarter of 2020 has been an unmitigated success. This allows us to satisfy more customers, do more business on less inventory, achieve higher full-price sell-throughs, and ultimately higher margins. As successful as our ship-from-store capability has been so far, we believe there is still more opportunity to capitalize on this capability as we continue to refine our processes. In our emerging Southern Tide retail operations, We recently and successfully launched ship-from-store capabilities that we will continue to enhance and grow as the Southern Tide retail footprint expands. In Lilliput, we have had ship-from-store capabilities for a number of years, but currently have a very exciting project underway that will significantly enhance those capabilities and should go live sometime next year. Additionally, we are using clienteling tools to merge the digital and retail experiences for Lilly Pellitzer customers. Operationally, we are focused on managing inventory and optimizing our supply chain. We have the appropriate inventory levels to support our planned growth for this year. Additionally, we are seeing benefits from implementing platform fabrics such as the previously mentioned Tommy Bahama Aubrey and Lily Pulitzer Merrill Nylon and Fairway Performance Twill collections, which bolster inventory management and profitability. Such platforms speed up the product development process, allow us to buy in higher quantities, and defer the point of differentiation until later in the process. The momentum that we created has continued into the early part of the second quarter and we have outstanding plans to deliver double digit top and bottom line growth with operating margin expansion for the year. We look forward to updating you on the progress of all these plans as well as our results as this year progresses. I'll now turn it over to Scott for more detail about first quarter results and our forecast for the remainder of the year. Scott?