• Q2 earnings tumbled to $2.6m from $7.2m
  • Net sales rose 26% to $180.6m from $143.0m
  • Gross margins up 170 basis points to 57.0% 

Clothing maker Oxford Industries Inc, owner of brands such as Ben Sherman, Oxford Golf and Lilly Pulitzer, has blamed a loss on the repurchase of senior secured notes for a 63.9% drop in second quarter profit, but raised its guidance on the back of strong sales.

For the full year, earnings are seen in the range of $2.20 to $2.30 per share on net sales of $735m to $750m. This compares to earlier forecasts of $2.15 to $2.25 in earnings per share and net sales of $730m to $745m.

"We are very pleased with the outstanding results we achieved during the second quarter which were driven by especially strong performances from our Tommy Bahama and Lilly Pulitzer businesses," said chairman and CEO J Hicks Lanier.

"Our direct to consumer business continued to deliver growth in both top-line revenue and margins. We were also pleased to have used excess cash to significantly reduce our outstanding debt and interest expense while maintaining a high level of liquidity which ensures that we will have ample financial flexibility going forward."

"As we enter the second half of the year we are mindful of the macroeconomic uncertainty, but we are confident in the strength of our brands and the capability of our management team."

Results in the second quarter were driven by a strong performance at Tommy Bahama, where sales rose 9.9% to $109.1m, and at Lilly Pulitzer, which the company acquired in December 2010 and achieved sales of $24.8m.

Revenues at Ben Sherman edged up 14.2% to $20.9m thanks to the currency exchange rate, but the brand saw its operating loss widen to $1.8m due to higher product sourcing costs. And at $22.9m, net sales for Lanier Clothes were marginally ahead of last year.