Oxford Industries OXM Form 10-Q filing Q2 FY2025

DEFINITIONS

As used in this report, unless the context requires otherwise, "our," "us" or "we" means Oxford Industries, Inc. and its consolidated subsidiaries; "SG&A" means selling, general and administrative expenses; "SEC" means the United States Securities and Exchange Commission; "FASB" means the Financial Accounting Standards Board; "ASC" means the FASB Accounting Standards Codification; "GAAP" means generally accepted accounting principles in the United States; "TBBC" means The Beaufort Bonnet Company; and “Fiscal 2024 Form 10-K” means our Annual Report on Form 10-K for Fiscal 2024. Additionally, the terms listed below reflect the respective period noted:

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

See accompanying notes.

See accompanying notes.

See accompanying notes.

See accompanying notes.

OXFORD INDUSTRIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(in thousands, except per share amounts)

(unaudited)

See accompanying notes.

OXFORD INDUSTRIES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

SECOND QUARTER OF FISCAL 2025

Note 1. Basis of Presentation:

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with GAAP for interim financial reporting and the instructions of Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. We believe the accompanying unaudited condensed consolidated financial statements reflect all normal, recurring adjustments that are necessary for a fair presentation of our financial position and results of operations as of the dates and for the periods presented. Results of operations for interim periods are not necessarily indicative of results to be expected for a full fiscal year due to the seasonality of our business.

The preparation of our unaudited condensed consolidated financial statements in conformity with GAAP requires us to make certain estimates and assumptions that affect the amounts reported as assets, liabilities, revenues and expenses in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates.

The significant accounting policies applied during the interim periods presented are consistent with the significant accounting policies described in our Fiscal 2024 Form 10-K. These financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our Fiscal 2024 Form 10-K.

Recently Issued Accounting Standards Applicable to Future Years

Changes to U.S. GAAP are established by the Financial Accounting Standards Board (“FASB”) in the form of Accounting Standards Updates (“ASUs”) to the FASB Accounting Standards Codification (“ASC”). We consider the applicability and impact of all ASUs and any not listed below were assessed and determined to not be applicable or are expected to have an immaterial impact on our Condensed Consolidated Financial Statements.

In December 2023, the FASB issued ASU 2023-09 "Income Taxes (Topic 740): Improvements to Income Tax Disclosures" to expand the disclosure requirements for income taxes, specifically related to the rate reconciliation and income taxes paid. The amendments in this update are effective for annual periods beginning after December 15, 2024. Early adoption is permitted. The amendments should be applied on a prospective basis with the option to apply the standard retrospectively. We are evaluating how the expanded disclosure requirements of ASU 2023-09 will affect our presentation, and we will include the incremental disclosures upon the effective date.

In November 2024, the FASB issued ASU 2024-03 "Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses" that expands the disclosure requirements about specific expense categories, primarily through disaggregated information on income statement line items. The amendments in this update are effective for fiscal years beginning after December 15, 2026, and for interim periods within fiscal years beginning after December 15, 2027. Early adoption and retrospective application are permitted. We are evaluating how the enhanced disclosure requirements of ASU 2024-03 will affect our presentation, and we will include the applicable disclosures upon the effective date.

Note 2. Operating Segments:

We identify our operating segments based on the way the chief operating decision maker ("CODM") organizes the components of our business for purposes of allocating resources and assessing performance. Our operating segment structure reflects a brand-focused management approach, emphasizing operational coordination and resource allocation across each brand’s direct to consumer, wholesale and licensing operations, as applicable.

The Tommy Bahama, Lilly Pulitzer and Johnny Was operating segments are each identified as a reportable segment. The operations of our smaller, earlier stage operating segments Southern Tide, TBBC, Duck Head and Jack Rogers are aggregated into the Emerging Brands reportable segment.

Corporate and Other is a reconciling category for reporting purposes and includes the elimination of inter-segment sales, which totaled less than $1 million in both the First Half of Fiscal 2025 and the First Half of Fiscal 2024. Corporate and Other also includes our corporate offices, substantially all financing activities, any other items that are not allocated to

the operating segments, including LIFO inventory accounting adjustments as our LIFO pool does not correspond to our operating segment definitions, and unallocated Corporate expenses.

The table below presents certain financial information (in thousands) about our reportable segments, as well as Corporate and Other.

(1) For all reporting units, other segment items primarily consists of software costs, professional services costs, other selling, general, and administrative costs and royalties and other income.

(2) Cost of goods sold for Corporate and Other included a LIFO accounting charge of $1 million in the Second Quarter of Fiscal 2025 and the Second Quarter of Fiscal 2024 and a charge of $1 million in the First Half of Fiscal 2025 and $3 million in the First Half of Fiscal 2024.

(3) Unallocated Corporate costs for Corporate and Other primarily consists of unallocated employment and other overhead expenses.

The tables below present certain financial information (in thousands) about our reportable segments, as well as Corporate and Other.

(1) Increase in Tommy Bahama total assets from August 3, 2024, relates primarily to an increase in operating lease assets, inventories and property and equipment.

(2) Increase in Lilly Pulitzer total assets from August 3, 2024, includes increases in software related assets, intangible assets related to the acquisition of intellectual property rights in the Fourth Quarter of Fiscal 2024 and inventories.

(3) Decrease in Johnny Was total assets from August 3, 2024, relates primarily to the amortization of acquired intangible assets and a decrease in operating lease assets.

(4) Increase in Emerging Brands total assets from August 3, 2024, relates primarily to an increase in inventories and property and equipment.

(5) Increase in Corporate and Other total assets from August 3, 2024, relates primarily to an increase in property and equipment primarily related to the new distribution center project in Lyons, Georgia.

Net sales by geographic area are presented in the table below (in thousands). The other foreign amounts primarily relate to our Tommy Bahama operations in Canada and Australia.

The tables below quantify net sales, for each reportable segment, as well as Corporate and Other, and in total (in thousands), and the percentage of net sales by distribution channel for each reportable segment, as well as Corporate and Other, and in total, for each period presented. We have calculated all percentages below based on actual data, and percentages may not add to 100 due to rounding.

Note 3. Revenue Recognition and Receivables:

Our revenue consists of direct to consumer sales, including our retail store, e-commerce and food & beverage operations, and wholesale sales, as well as royalty income, which is included in royalties and other operating income in our consolidated statements of operations. We recognize revenue when performance obligations under the terms of the contracts with our customers are satisfied. Our accounting policies related to revenue recognition for each type of contract with customers are described in the significant accounting policies in our Fiscal 2024 Form 10-K.

The table below quantifies net sales by distribution channel (in thousands) for each period presented.

An estimated sales return liability of $10 million, $10 million and $11 million for expected direct to consumer returns is classified in accrued expenses and other liabilities in our consolidated balance sheets as of August 2, 2025, February 1, 2025, and August 3, 2024, respectively. As of August 2, 2025, February 1, 2025, and August 3, 2024, prepaid expenses and other current assets included $3 million, $3 million and $4 million, respectively, relating to the estimated value of inventory for expected direct to consumer and wholesale sales returns.

Substantially all amounts recognized in receivables, net represent trade receivables related to contracts with customers. In the ordinary course of our wholesale operations, we offer discounts, allowances and cooperative advertising support to and accept returns from certain of our wholesale customers for certain products. As of August 2, 2025, February 1, 2025, and August 3, 2024, reserve balances recorded as a reduction to receivables related to these items were $3 million, $3 million and $3 million, respectively. As of August 2, 2025, February 1, 2025, and August 3, 2024, our provision for credit losses related to receivables included in our consolidated balance sheets was $1 million, $1 million and $1 million, respectively.

Contract liabilities for gift cards purchased by consumers and merchandise credits received by customers but not yet redeemed, less any breakage income recognized to date, is included in accrued expenses and other liabilities in our consolidated balance sheets and totaled $21 million, $22 million and $20 million as of August 2, 2025, February 1, 2025, and August 3, 2024, respectively.

Note 4. Leases:

For the Second Quarter of Fiscal 2025, operating lease expense was $22 million and variable lease expense was $11 million, resulting in total lease expense of $33 million compared to $31 million of total lease expense in the Second Quarter of Fiscal 2024. For the First Half of Fiscal 2025, operating lease expense was $43 million and variable lease expense was $23 million, resulting in total lease expense of $66 million compared to $63 million of total lease expense in the First Half of Fiscal 2024.

Cash paid for lease amounts included in the measurement of operating lease liabilities in the First Half of Fiscal 2025 and the First Half of Fiscal 2024 was $46 million and $43 million, respectively.

As of August 2, 2025, the stated lease liability payments for the fiscal years specified below were as follows (in thousands):

Note 5. Shareholders’ Equity:

From time to time, we repurchase our common stock mainly through open market repurchase plans. On December 10, 2024, our Board of Directors authorized us to spend up to $100 million to repurchase shares of our stock. This authorization superseded and replaced all previous authorizations to repurchase shares of our stock. During the First Quarter of Fiscal 2025, we repurchased 842,007 shares of our common stock at an average price of $59.38 for $50 million as part of an open market repurchase program (Rule 10b5-1 plan) under the December 10, 2024 authorization.

On March 24, 2025, our Board of Directors authorized us to spend up to $100 million to repurchase shares of our stock. This authorization superseded and replaced all previous authorizations to repurchase shares of our stock and has no automatic expiration. During the Second Quarter of Fiscal 2025, we repurchased 114,477 shares of our common stock at an average cost of $40.46 for $5 million in open market repurchases under the March 24, 2025 authorization. During the First Half of Fiscal 2025, we repurchased a total of 956,484 shares in open market repurchases at an average cost of $57.12 for $55 million. During the Second Quarter of Fiscal 2024 and First Half of Fiscal 2024, there were no open market repurchases.

As of August 2, 2025, $95 million remained under the Board of Directors' authorization.

We also repurchase shares from our employees to cover employee tax liabilities related to the vesting of shares of our common stock. During the Second Quarter of Fiscal 2025 and First Half of Fiscal 2025, we repurchased $2 million of shares from our employees related to the May 2025 vesting of service-based restricted share awards and TSR-based restricted share units. During the Second Quarter of Fiscal 2024 and the First Half of Fiscal 2024, we repurchased $6 million of shares from our employees related to the May 2024 vesting of service-based restricted share awards and TSR-based restricted share units.

Long-Term Stock Incentive Plan and Equity Compensation Expense

In recent years, we have granted a combination of service-based restricted share awards and awards based on relative total shareholder return ("TSR") to certain select employees.

Service-Based Restricted Share Awards

The table below summarizes the service-based restricted share awards, including both restricted shares and restricted share units, activity for the First Half of Fiscal 2025:

TSR-based Restricted Share Units

The table below summarizes the TSR-based restricted share unit activity at target for the First Half of Fiscal 2025:

As disclosed in Note 1 to our consolidated financial statements contained in our Fiscal 2024 Form 10-K, the fair value of TSR-based awards is not tied to the price of our common stock at any fixed point in time; rather, the fair value of TSR-based awards is determined using a Monte Carlo simulation model, which models multiple TSR paths for our common stock as well as the comparator group, as applicable, to evaluate and determine the estimated fair value of the award.

Note 6. Debt:

Our Fourth Amended and Restated Credit Agreement (as amended, the "U.S. Revolving Credit Agreement") provides for a revolving credit facility of up to $325 million, which may be used to fund working capital requirements, capital expenditures, share repurchases, future acquisitions and for general corporate purposes. The U.S. Revolving Credit Agreement matures in March 2028. Pursuant to the U.S. Revolving Credit Agreement, the interest rate applicable to our borrowings under the U.S. Revolving Credit Agreement is based on either the Term Secured Overnight Financing Rate plus an applicable margin of 135 to 185 basis points or prime plus an applicable margin of 25 to 75 basis points.

The U.S. Revolving Credit Agreement generally (1) is limited to a borrowing base consisting of specified percentages of eligible categories of assets, (2) accrues variable-rate interest (weighted average interest rate of 6% as of August 2, 2025), unused line fees and letter of credit fees based upon average utilization or unused availability, as

applicable, (3) requires periodic interest payments with principal due at maturity and (4) is secured by a first priority security interest in substantially all of the assets of Oxford Industries, Inc. and its domestic subsidiaries, including accounts receivable, books and records, chattel paper, deposit accounts, equipment, certain general intangibles, inventory, investment property (including the equity interests of certain subsidiaries), negotiable collateral, life insurance policies, supporting obligations, commercial tort claims, cash and cash equivalents, eligible trademarks, proceeds and other personal property.

We issue standby letters of credit under the U.S. Revolving Credit Agreement. Outstanding letters of credit under the U.S. Revolving Credit Agreement reduce the amount of borrowings available to us when issued and, as of August 2, 2025, February 1, 2025, and August 3, 2024, totaled $5 million, $5 million and $5 million, respectively.

As of August 2, 2025 and February 1, 2025, we had $81 million and $31 million, respectively, of borrowings outstanding and $239 million and $289 million, respectively, in unused availability under the U.S. Revolving Credit Agreement. As of August 3, 2024, we had no borrowings outstanding and $306 million in unused availability under the U.S. Revolving Credit Agreement. The increase in debt during the First Half of Fiscal 2025 was the result of (1) share repurchases, (2) increased capital expenditures primarily associated with the project to build a new distribution center in Lyons, Georgia, (3) payments of dividends and (4) and working capital requirements exceeding cash flow from operations.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis should be read in conjunction with our unaudited condensed consolidated financial statements and the notes thereto contained in this report and the consolidated financial statements, notes to consolidated financial statements and Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in our Fiscal 2024 Form 10-K.

OVERVIEW

Business Overview

We are a leading branded apparel company that designs, sources, markets and distributes products bearing the trademarks of our Tommy Bahama, Lilly Pulitzer, Johnny Was, Southern Tide, TBBC, Duck Head and Jack Rogers lifestyle brands.

Our business strategy is to drive excellence across a portfolio of lifestyle brands that create sustained, profitable growth. We consider lifestyle brands to be those brands that have a clearly defined and targeted point of view inspired by an appealing lifestyle or attitude. Furthermore, we believe lifestyle brands that create an emotional connection can command greater loyalty and higher price points and create licensing opportunities. We believe the attraction of a lifestyle brand depends on creating compelling product, effectively communicating the respective lifestyle brand message and distributing products to consumers where and when they want them. We believe the principal competitive factors in the apparel industry are the reputation, value, and image of brand names; design of differentiated, innovative or otherwise compelling product; consumer preference; price; quality; marketing; product fulfillment capabilities; and customer service. Our ability to compete successfully in the apparel industry is dependent on our proficiency in foreseeing changes and trends in fashion and consumer preference and presenting appealing products for consumers. Our design-led, commercially informed lifestyle brand operations strive to provide exciting, differentiated fashion products each season as well as certain core products that consumers expect from us.

During Fiscal 2024, 81% of our consolidated net sales were through our direct to consumer channels of distribution, which consist of our brand specific full-price retail stores, e-commerce websites and outlets, as well as our Tommy Bahama food & beverage operations. The remaining 19% of our net sales was generated through our wholesale distribution channels, which complement our direct to consumer operations and provide access to a larger base of consumers. Our wholesale operations consist of sales of products bearing the trademarks of our lifestyle brands to various specialty stores, better department stores, Signature Stores, multi-branded e-commerce retailers and other retailers.

For additional information about our business and our operating segments, see Part I, Item 1. Business of our Fiscal 2024 Form 10-K. Important factors relating to certain risks which could impact our business are described in Part I. Item 1A. Risk Factors of our Fiscal 2024 Form 10-K, as updated by Part II, Item 1A. Risk Factors in our Quarterly Report on Form 10-Q for the First Quarter of Fiscal 2025.

Industry Overview

We operate in a highly competitive apparel market. No single apparel firm or small group of apparel firms dominates the apparel industry, and our competitors vary by operating segment and distribution channel. The apparel industry is cyclical and very dependent on the overall level and focus of discretionary consumer spending, which changes as consumer preferences and regional, domestic and international economic conditions change. Also, in recent years consumers have chosen to spend less of their discretionary spending on certain product categories, including apparel, while spending more on services and other product categories. Further, negative economic conditions often have a longer and more severe impact on the apparel industry than on other industries due, in part, to apparel purchases often being more of a discretionary purchase.

This competitive and evolving environment requires that brands and retailers approach their operations, including marketing and advertising, very differently than they have historically and may result in increased operating costs and investments to generate growth or even maintain existing sales levels. The competition and evolution within the industry present significant risks that have been compounded in the current macroenvironment as a result of developments in U.S. trade regulations and geopolitical issues. Other issues, including the availability and cost of credit and elevated interest rates for prolonged periods, have also heightened concern in the current environment. The future geopolitical landscape

remains particularly uncertain and any changes in international trade relations, legislation and regulations, including those related to importation and tariffs, taxation, economic and monetary policies, or heightened diplomatic tensions or political and civil unrest, among other potential impacts, could adversely impact the global economy and our operating results. These factors, when combined with heightened promotional activity in our industry, create a complex and challenging retail environment, which has impacted and will continue to impact our businesses and financial results during Fiscal 2025 and has exacerbated some of the inherent challenges to our operations and may continue to do so in the future. There remains significant uncertainty in the macroeconomic environment, and the impact of these and other factors could have a major effect on our businesses.

In addition, compounding the uncertainty and challenges in the current macroeconomic environment, since the start of Fiscal 2025, the U.S. government has announced broad-based, reciprocal tariffs on foreign imports, with the potential for further increases or revisions. The reciprocal tariffs, which in some cases are compounded by newly implemented “penalty” or “secondary” tariffs on a country-by-country basis, impact substantially all of the countries from which we import products, although at varying rates. These announcements, along with the potential for future changes, has created significant uncertainty in the global trade environment. As previously disclosed, we have been proactively taking steps to mitigate our tariff exposure regardless of the outcome of the U.S. government’s trade decisions. These mitigation efforts include an acceleration in our ongoing efforts to decentralize our product sourcing, coordinating production and shipments into the U.S. during potential periods of delayed application of newly implemented or increased tariffs, negotiations with our vendors and potential price increases. The duration and scope of the tariffs are difficult to predict, along with the extent to which we will be able to offset the impact, and there could be a material negative impact on our results of operations depending on the outcome of the government’s trade decisions.

We believe our lifestyle brands have true competitive advantages, and we continue to invest in our brands’ direct to consumer initiatives and distribution capabilities while further leveraging technology to serve our consumers when and where they want to be served. We continue to believe that our lifestyle brands, with their strong emotional connections with consumers, are well suited to succeed and thrive in the long term while managing the various challenges facing our industry in the current environment. At the same time, we remain cautious in light of extrinsic factors and are proactively working with outside advisors and taking measures to reassess and realign our operating expenses to drive long-term operating margin expansion across our businesses.

Key Operating Results:

The following table sets forth our consolidated operating results (in thousands, except per share amounts) for the First Half of Fiscal 2025 compared to the First Half of Fiscal 2024:

Net earnings per diluted share was $2.83 in the First Half of Fiscal 2025 compared to $4.99 in the First Half of Fiscal 2024 reflecting (1) decreased net sales, (2) increased SG&A, (3) lower gross margin, (4) increased interest expense, (5) decreased royalties and other operating income and (6) a higher effective tax rate. These decreases were partially offset by a reduction in weighted average shares outstanding due to share repurchases made in the First Half of Fiscal 2025. Net earnings and gross margin in the First Half of Fiscal 2025 were impacted by approximately $10 million of increased cost of goods sold from additional tariffs enacted in Fiscal 2025, net of mitigation efforts.

COMPARABLE SALES

We often disclose comparable sales to provide additional information regarding changes in our results of operations between periods. Our disclosures of comparable sales include net sales from our full-price retail stores and e-commerce sites. We believe that the inclusion of both full-price retail stores and e-commerce sites in the comparable sales disclosures is a more meaningful way of reporting our comparable sales results, given similar inventory planning, allocation and return

policies, as well as our cross-channel marketing and other initiatives for the direct to consumer channels. For our comparable sales disclosures, we exclude (1) outlet store sales as those clearance sales are used primarily to liquidate end of season inventory, which may vary significantly depending on the level of end of season inventory on hand and generally occur at lower gross margins than our non-clearance direct to consumer sales, and (2) food & beverage sales, as we do not currently believe that the inclusion of food & beverage sales in our comparable sales disclosures is meaningful in assessing our branded apparel businesses. Historically, we also excluded from our comparable sales disclosures e-commerce flash clearance sales used to liquidate excess inventory; however, given the evolving cadence of marking down retail sales prices associated with our e-commerce operations, we are now including those sales for purposes of our comparable sales disclosures. Comparable sales information reflects net sales, including shipping and handling revenues, if any, associated with product sales.

For purposes of our disclosures, comparable sales consists of sales through e-commerce sites and any physical full-price retail stores that were owned and open as of the beginning of the prior fiscal year and which did not have during the relevant periods, and is not within the current fiscal year scheduled to have, (1) a remodel or other event which would result in a closure for an extended period of time (which we define as a period of two weeks or longer), (2) a greater than 15% change in the size of the retail space due to expansion, reduction or relocation to a new retail space or (3) a relocation to a new space that is significantly different from the prior retail space (including relocations to accommodate an adjacent Tommy Bahama food & beverage concept). For those stores which are excluded based on the preceding sentence, the stores continue to be excluded from comparable sales until the criteria for a new store is met subsequent to the remodel, relocation, or other event. A full-price retail store that is remodeled will generally continue to be included in our comparable sales metrics as a store is not typically closed for longer than a two-week period during a remodel; however, a full-price retail store that is relocated generally will not be included in our comparable sales metrics until that store has been open in the relocated space for the entirety of the prior fiscal year because the size or other characteristics of the store typically change significantly from the prior location. Any stores that were closed during the prior fiscal year or current fiscal year, or which we expect to close or vacate in the current fiscal year, as well as any pop-up or temporary store locations, are excluded from our comparable sales metrics.

Definitions and calculations of comparable sales differ among companies, and therefore comparable sales metrics disclosed by us may not be comparable to the metrics disclosed by other companies.

DIRECT TO CONSUMER LOCATIONS

The table below provides information about the number of direct to consumer locations for our brands as of the dates specified. The figures below include our permanent locations and exclude any pop-up or temporary store locations which have an initial lease term of 12 months or less.

RESULTS OF OPERATIONS

SECOND QUARTER OF FISCAL 2025 COMPARED TO SECOND QUARTER OF FISCAL 2024

The discussion and tables below compare our statements of operations for the Second Quarter of Fiscal 2025 to the Second Quarter of Fiscal 2024. Each dollar and percentage change provided reflects the change between these fiscal periods unless indicated otherwise. Each dollar and share amount included in the tables is in thousands except for per share amounts. We have calculated all percentages based on actual data, and percentage columns in tables may not add due to rounding. Individual line items of our consolidated statements of operations, including gross profit, may not be directly comparable to those of our competitors, as classification of certain expenses may vary by company.

The following table sets forth the specified line items in our unaudited condensed consolidated statements of operations both in dollars (in thousands) and as a percentage of net sales as well as the dollar change and the percentage change as compared to the same period of the prior year. The table also includes net earnings per diluted share and diluted weighted average shares outstanding (in thousands), as well as the change and the percentage change for each of these items as compared to the same period of the prior year.

Net Sales

Consolidated net sales were $403 million in the Second Quarter of Fiscal 2025 compared to net sales of $420 million in the Second Quarter of Fiscal 2024. The decrease in net sales included decreased sales in Tommy Bahama, Johnny Was and Lilly Pulitzer. These decreases were partially offset by increased sales in Emerging Brands.

The changes in net sales by distribution channel consisted of the following:

• a decrease in full-price retail sales of $9 million, or 6%, including (1) a $6 million decrease in Tommy Bahama, (2) a $3 million decrease in Johnny Was and (3) a $2 million decrease in Lilly Pulitzer. These decreases were partially offset by a $2 million increase in Emerging Brands;
• a decrease in wholesale sales of $4 million, or 6%, including (1) a $3 million decrease in Tommy Bahama and (2) a $2 million decrease in Lilly Pulitzer. These decreases were partially offset by a $2 million increase in Emerging Brands;
• a decrease in e-commerce sales of $3 million, or 2%, including (1) a $6 million decrease in Tommy Bahama and (2) a $2 million decrease in Johnny Was. These decreases were partially offset by (1) a $3 million increase in Lilly Pulitzer and (2) a $1 million increase in Emerging Brands;
• a decrease in outlet sales of $1 million, or 4%, including a $1 million decrease in Tommy Bahama; and
• food & beverage sales in the Second Quarter of Fiscal 2025 were comparable to the Second Quarter of Fiscal 2024.

The following table presents the proportion of our consolidated net sales by distribution channel for each period presented. We have calculated all percentages below on actual data, and percentages may not add to 100 due to rounding.

Tommy Bahama:

Tommy Bahama net sales decreased $16 million, or 7%, in the Second Quarter of Fiscal 2025, with a decrease in (1) full-price retail sales of $6 million, or 7%, (2) e-commerce sales of $6 million, or 8%, (3) wholesale sales of $3 million, or 10%, and (4) outlet sales of $1 million, or 4%. Food & beverage sales in the Second Quarter of Fiscal 2025 were comparable to the Second Quarter of Fiscal 2024. The following table presents the proportion of net sales by distribution channel for Tommy Bahama for each period presented:

Lilly Pulitzer:

Lilly Pulitzer net sales decreased $1 million, or 2%, in the Second Quarter of Fiscal 2025, with a decrease in (1) wholesale sales of $2 million, or 15%, and (2) retail sales of $2 million, or 6%. These decreases were partially offset by an increase in e-commerce sales of $3 million, or 7%. The following table presents the proportion of net sales by distribution channel for Lilly Pulitzer for each period presented:

Johnny Was:

Johnny Was net sales decreased $5 million, or 10%, in the Second Quarter of Fiscal 2025, with a decrease in (1) retail sales of $3 million, or 14%, and (2) e-commerce sales of $2 million, or 8%. Wholesale sales in the Second Quarter of Fiscal 2025 were comparable to the Second Quarter of Fiscal 2024. The following table presents the proportion of net sales by distribution channel for Johnny Was for each period presented:

Emerging Brands:

Emerging Brands net sales increased $6 million, or 17% in the Second Quarter of Fiscal 2025. Increases included increased sales in Southern Tide and TBBC. Net sales for Duck Head and Jack Rogers in the Second Quarter of Fiscal 2025 were comparable to the Second Quarter of Fiscal 2024. By distribution channel, the increase in net sales in Emerging Brands included increases in (1) retail sales of $2 million, or 33%, as we opened new retail locations, (2) wholesale sales of $2 million, or 23%, and (3) e-commerce sales of $1 million, or 8%. The following table presents the proportion of net sales by distribution channel for Emerging Brands for each period presented:

Corporate and Other:

Corporate and Other net sales primarily consist of the elimination of any sales between operating segments.

Gross Profit

The tables below present gross profit by reportable segment and Corporate and Other and in total for the Second Quarter of Fiscal 2025 and the Second Quarter of Fiscal 2024, as well as the dollar change and percentage change between those two periods, and gross margin by reportable segment and Corporate and Other and in total. Our gross profit and gross margin, which is calculated as gross profit divided by net sales, may not be directly comparable to those of our competitors, as the statement of operations classification of certain expenses may vary by company.

The decreased gross profit of 7% was primarily due to (1) the 4% decrease in net sales and (2) decreased consolidated gross margin. The decreased gross margin was primarily due to approximately $9 million of increased cost of goods sold from additional tariffs implemented in Fiscal 2025, net of mitigation efforts. This decrease was partially offset by (1) improved gross margin during promotional events at Tommy Bahama, (2) a change in sales mix with full-price retail and e-commerce sales representing a higher proportion of net sales at Lilly Pulitzer and Johnny Was and (3) a change in sales mix with wholesale sales representing a lower proportion of net sales.

Tommy Bahama:

The lower gross margin for Tommy Bahama was primarily due to increased cost of goods sold from additional tariffs implemented in Fiscal 2025. This decrease was partially offset by (1) improved gross margin during promotional events, including loyalty award cards, Flip Side and end of season clearance events, (2) a change in sales mix with a lower proportion of net sales occurring during end of season clearance events and (3) a change in sales mix with wholesale sales representing a lower proportion of net sales.

Lilly Pulitzer:

The lower gross margin for Lilly Pulitzer was primarily due to increased cost of goods sold from additional tariffs implemented in Fiscal 2025. This decrease was partially offset by (1) a change in sales mix with full-price retail and e-commerce sales representing a higher proportion of net sales and (2) a change in sales mix with wholesale sales representing a lower proportion of net sales.

Johnny Was:

The lower gross margin for Johnny Was was primarily due to increased cost of goods sold from additional tariffs implemented in Fiscal 2025. This decrease was partially offset by a change in sales mix with full-price retail and e-commerce sales representing a higher proportion of net sales resulting from fewer sales occurring during promotional and clearance events.

Emerging Brands:

The lower gross margin for Emerging Brands was primarily due to higher markdowns during promotional and clearance events.

Corporate and Other:

The gross profit in Corporate and Other primarily reflects the impact of LIFO accounting adjustments that resulted in a $1 million charge in both the Second Quarter of Fiscal 2025 and the Second Quarter of Fiscal 2024. The LIFO accounting impact in Corporate and Other in each period includes the net impact of (1) a charge in Corporate and Other when inventory that had been marked down in an operating segment in a prior period was ultimately sold, (2) a credit in Corporate and Other when inventory had been marked down in an operating segment in the current period, but had not been sold as of period end and (3) the change in the LIFO reserve, if any.

SG&A

SG&A was $226 million in the Second Quarter of Fiscal 2025 compared to $217 million in the Second Quarter of Fiscal 2024, with approximately $4 million, or 51%, of the expenses that increased during the Second Quarter of Fiscal 2025 due to increases in employment costs, occupancy costs and depreciation expense attributable to the increase in brick and mortar retail locations. The 4% increase in total SG&A in the Second Quarter of Fiscal 2025 included the following, which, where applicable, includes the SG&A of the new brick and mortar locations:

• $6 million increase in employment costs driven primarily by increased incentive compensation and new brick and mortar retail locations;
• $3 million increase in software subscription and consulting related costs;
• $2 million increase in occupancy costs;
• $1 million increase in depreciation expense; and
• $1 million of increased costs associated with the project to build a new distribution center in Lyons, Georgia.

These increases were partially offset by:

• $3 million decrease in advertising related costs;
• $1 million decrease from the absence of Johnny Was Distribution Center relocation costs incurred in the Second Quarter of Fiscal 2024; and
• $1 million decrease in amortization of intangible assets.

Royalties and other operating income

Royalties and other operating income typically consists primarily of income received from third parties from the licensing of our brands. The decreased royalties and other operating income in the Second Quarter of Fiscal 2025 was primarily due to decreased royalty income in Tommy Bahama reflecting the lower sales of our licensing partners.

Operating income (loss)

Operating income was $25 million in the Second Quarter of Fiscal 2025 compared to $53 million in the Second Quarter of Fiscal 2024. The decreased operating income included lower operating results in Tommy Bahama, Corporate and Other, Lilly Pulitzer and Johnny Was. Changes in operating income (loss) by reportable segment and Corporate and Other are discussed below.

Tommy Bahama:

The decreased operating income for Tommy Bahama was due to (1) decreased net sales, (2) lower gross margin and (3) increased SG&A. The increased SG&A was primarily due to $2 million of higher SG&A associated with new retail store and Marlin Bar locations with retail and food & beverage operations, including related employment costs, occupancy costs, administrative expenses and depreciation expense.

Lilly Pulitzer:

The decreased operating income for Lilly Pulitzer was due to (1) lower gross margin and (2) decreased net sales. SG&A in the Second Quarter of Fiscal 2025 was comparable to the Second Quarter of Fiscal 2024 with $1 million of higher SG&A associated with new retail store locations, including related employment costs, occupancy costs, administrative expenses and depreciation expense and $1 million of increased software subscription and consulting expenses offset by a $2 million decrease in advertising costs.

Johnny Was:

The decreased operating results for Johnny Was were primarily due to (1) decreased net sales and (2) lower gross margin. These decreases were partially offset by decreased SG&A. The decreased SG&A was primarily due to (1) $1 million of decreased advertising costs, (2) $1 million of decreased amortization of intangible assets and (3) the absence of $1 million in Johnny Was Distribution Center costs incurred in the Second Quarter of Fiscal 2024.

Emerging Brands:

Operating income for Emerging Brands in the Second Quarter of Fiscal 2025 was comparable to the Second Quarter of Fiscal 2024. The increase in net sales was partially offset by (1) higher SG&A and (2) lower gross margin. The increased SG&A was primarily due to new retail store operations, including related employment costs, occupancy costs, administrative expenses and depreciation expense.

Corporate and Other:

The lower operating results in Corporate and Other were primarily a result of increased SG&A. The increased SG&A was primarily due to (1) $3 million of increased employment costs primarily driven by increased incentive compensation, (2) $2 million of increased professional and consulting costs and (3) $1 million of increased costs associated with the project to build a new distribution center in Lyons, Georgia.

Interest expense, net

The increased interest expense in the Second Quarter of Fiscal 2025 was primarily due to a higher average outstanding debt balance during the Second Quarter of Fiscal 2025 than the Second Quarter of Fiscal 2024.

Income tax

Our effective tax rate will vary from period to period from a typical annual effective tax rate of approximately 25% based on various factors including, but not limited to, the geographic mix of earnings, enacted tax legislation, state and local taxes, tax audit findings and settlements, and the interaction of various global tax strategies.

For the Second Quarter of Fiscal 2025, our effective tax rate was 30.1%, which primarily reflects the unfavorable net discrete tax expense related to shortfalls from stock-based compensation vesting during the quarter. On July 4, 2025, H.R. 1 (commonly referred to as the One Big Beautiful Bill Act or "OB3") was enacted, reinstating bonus depreciation and accelerating the deduction for research and experimentation expenses previously capitalized and amortized under the Tax Cuts and Jobs Act of 2017 (“TCJA”). In the Second Quarter of Fiscal 2025, we reflected the changes to certain timing differences in the current period that did not have a material net impact on income tax expense.

For the Second Quarter of Fiscal 2024, our effective income tax rate was 22.5%, which primarily reflects the favorable net discrete tax benefits for stock-based compensation vesting during the quarter.

Net earnings

Net earnings per diluted share was $1.12 in the Second Quarter of Fiscal 2025 compared to $2.57 in the Second Quarter of Fiscal 2024 reflecting (1) decreased net sales, (2) increased SG&A, (3) lower gross margin, (4) a higher effective tax rate, (5) increased interest expense and (6) decreased royalties and other operating income. These decreases were partially offset by a reduction in weighted average shares outstanding due to share repurchases made in the First Half of Fiscal 2025. Net earnings and gross margin in the Second Quarter of Fiscal 2025 were impacted by approximately $9 million of increased cost of goods sold from additional tariffs enacted in Fiscal 2025, net of mitigation efforts.

RESULTS OF OPERATIONS

FIRST HALF OF FISCAL 2025 COMPARED TO FIRST HALF OF FISCAL 2024

The discussion and tables below compare our statements of operations for the First Half of Fiscal 2025 to the First Half of Fiscal 2024. Each dollar and percentage change provided reflects the change between these fiscal periods unless indicated otherwise. Each dollar and share amount included in the tables is in thousands except for per share amounts. We have calculated all percentages based on actual data, and percentage columns in tables may not add due to rounding.

Individual line items of our consolidated statements of operations, including gross profit, may not be directly comparable to those of our competitors, as classification of certain expenses may vary by company.

The following table sets forth the specified line items in our unaudited condensed consolidated statements of operations both in dollars (in thousands) and as a percentage of net sales as well as the dollar change and the percentage change as compared to the same period of the prior year. The table also includes net earnings per diluted share and diluted weighted average shares outstanding (in thousands), as well as the change and the percentage change for each of these items as compared to the same period of the prior year.

Net Sales

Consolidated net sales were $796 million in the First Half of Fiscal 2025 compared to net sales of $818 million in the First Half of Fiscal 2024. The decrease in net sales included decreased sales in Tommy Bahama and Johnny Was. These decreases were partially offset by increased sales in Lilly Pulitzer and Emerging Brands.

The changes in net sales by distribution channel consisted of the following:

• a decrease in full-price retail sales of $11 million, or 4%, including (1) an $11 million decrease in Tommy Bahama and (2) a $5 million decrease in Johnny Was. These decreases were partially offset by (1) a $4 million increase in Emerging Brands and (2) a $1 million increase in Lilly Pulitzer;
• a decrease in e-commerce sales of $9 million, or 3%, including (1) an $11 million decrease in Tommy Bahama and (2) a $6 million decrease in Johnny Was. These decreases were partially offset by (1) a $4 million increase in Lilly Pulitzer and (2) a $3 million increase in Emerging Brands;
• a decrease in food & beverage sales of $1 million, or 1%;
• a decrease in outlet sales of $1 million, or 2%, including a $1 million decrease in Johnny Was; and
• wholesale sales in the First Half of Fiscal 2025 were comparable to the First Half of Fiscal 2024.

The following table presents the proportion of our consolidated net sales by distribution channel for each period presented. We have calculated all percentages below on actual data, and percentages may not add to 100 due to rounding.

Tommy Bahama:

Tommy Bahama net sales decreased $26 million, or 5%, in the First Half of Fiscal 2025, with a decrease in (1) full-price retail sales of $11 million, or 6%, (2) e-commerce sales of $11 million, or 9%, (3) wholesale sales of $3 million, or 3%, and (4) food & beverage sales of $1 million, or 1%. The following table presents the proportion of net sales by distribution channel for Tommy Bahama for each period presented:

Lilly Pulitzer:

Lilly Pulitzer net sales increased $9 million, or 5%, in the First Half of Fiscal 2025, with an increase in each channel of distribution. The increase in net sales in Lilly Pulitzer included increases in (1) e-commerce sales of $4 million, or 5%, (2) wholesale sales of $3 million, or 10%, and (3) retail sales of $1 million, or 2%. The following table presents the proportion of net sales by distribution channel for Lilly Pulitzer for each period presented:

Johnny Was:

Johnny Was net sales decreased $13 million, or 12%, in the First Half of Fiscal 2025, with a decrease in (1) e-commerce sales of $6 million, or 13%, (2) retail sales of $5 million, or 14%, (3) wholesale sales of $1 million, or 5%, and (4) outlet sales of $1 million, or 29%. The following table presents the proportion of net sales by distribution channel for Johnny Was for each period presented:

Emerging Brands:

Emerging Brands net sales increased $7 million, or 10% in the First Half of Fiscal 2025. Increases included increased sales in Southern Tide, TBBC and Duck Head partially offset by decreased sales in Jack Rogers. By distribution channel, the increase in net sales in Emerging Brands included increases in (1) retail sales of $4 million, or 36%, as we opened new retail locations and (2) e-commerce sales of $3 million, or 9%. The following table presents the proportion of net sales by distribution channel for Emerging Brands for each period presented:

Corporate and Other:

Corporate and Other net sales primarily consist of the elimination of any sales between operating segments.

Gross Profit

The tables below present gross profit by reportable segment and Corporate and Other and in total for the First Half of Fiscal 2025 and the First Half of Fiscal 2024, as well as the dollar change and percentage change between those two periods, and gross margin by reportable segment and Corporate and Other and in total. Our gross profit and gross margin, which is calculated as gross profit divided by net sales, may not be directly comparable to those of our competitors, as the statement of operations classification of certain expenses may vary by company.

The decreased gross profit of 4% was primarily due to (1) the 3% decrease in net sales and (2) lower consolidated gross margin. The decreased gross margin was primarily due to approximately $10 million of increased cost of goods sold from additional tariffs enacted in Fiscal 2025, net of mitigation efforts. This decrease was partially offset by (1) improved gross margin during promotional events at Tommy Bahama, (2) a change in sales mix with full-price retail and e-commerce sales representing a higher proportion of net sales at Lilly Pulitzer and Johnny Was and (3) a $1 million lower LIFO accounting charge in the First Half of Fiscal 2025 compared to the First Half of Fiscal 2024.

Tommy Bahama:

The lower gross margin for Tommy Bahama was primarily due to increased cost of goods sold from additional tariffs implemented in Fiscal 2025. This decrease was partially offset by improved gross margin during promotional events, including loyalty award cards, Flip Side, end of season clearance events and the semi-annual Friends & Family event.

Lilly Pulitzer:

The lower gross margin for Lilly Pulitzer was primarily due to increased cost of goods sold from additional tariffs implemented in Fiscal 2025. This decrease was partially offset by a change in sales mix with full-price retail and e-commerce sales representing a higher proportion of net sales.

Johnny Was:

The lower gross margin for Johnny Was was primarily due to increased cost of goods sold from additional tariffs implemented in Fiscal 2025. This decrease was partially offset by a change in sales mix with full-price retail and e-commerce sales representing a higher proportion of net sales resulting from fewer sales occurring during promotional and clearance events.

Emerging Brands:

The lower gross margin for Emerging Brands was primarily due to higher markdowns during promotional and clearance events.

Corporate and Other:

The gross profit in Corporate and Other primarily reflects the impact of LIFO accounting adjustments that resulted in a $1 million lower charge in the First Half of Fiscal 2025 compared to the First Half of Fiscal 2024. The LIFO accounting impact in Corporate and Other in each period includes the net impact of (1) a charge in Corporate and Other when inventory that had been marked down in an operating segment in a prior period was ultimately sold, (2) a credit in Corporate and Other when inventory had been marked down in an operating segment in the current period, but had not been sold as of period end and (3) the change in the LIFO reserve, if any.

SG&A

SG&A was $448 million in the First Half of Fiscal 2025 compared to $430 million in the First Half of Fiscal 2024, with approximately $10 million, or 55%, of the expenses that increased during the First Half of Fiscal 2025 due to increases in employment costs, occupancy costs and depreciation expense attributable to the increase in brick and mortar retail locations. The 4% increase in total SG&A in the First Half of Fiscal 2025 included the following, which, where applicable, includes the SG&A of the new brick and mortar locations:

• $8 million increase in employment costs driven primarily by increased incentive compensation and new brick and mortar retail locations;
• $6 million increase in software subscription and consulting costs;
• $5 million increase in occupancy costs;
• $2 million increase in depreciation expense; and
• $1 million of increased costs associated with the project to build a new distribution center in Lyons, Georgia.

These increases were partially offset by:

• $2 million decrease in advertising costs;
• $1 million decrease in amortization of intangible assets; and
• $1 million decrease from the absence of Johnny Was Distribution Center relocation expenses incurred in the First Half of Fiscal 2024.

Royalties and other operating income

Royalties and other operating income typically consists primarily of income received from third parties from the licensing of our brands. The decreased royalties and other operating income in the First Half of Fiscal 2025 was primarily due to decreased royalty income in Tommy Bahama reflecting the lower sales of our licensing partners.

Operating income (loss)

Operating income was $62 million in the First Half of Fiscal 2025 compared to $105 million in the First Half of Fiscal 2024. The decreased operating income included lower operating results in all reportable segments and Corporate and Other. Changes in operating income (loss) by reportable segment and Corporate and Other are discussed below.

Tommy Bahama:

The decreased operating income for Tommy Bahama was due to (1) decreased net sales, (2) increased SG&A and (3) lower gross margin. The increased SG&A was primarily due to $5 million of higher SG&A associated with new retail store and Marlin Bar locations with retail and food & beverage operations, including related employment costs, occupancy costs, administrative expenses and depreciation expense.

Lilly Pulitzer:

The decreased operating income for Lilly Pulitzer was primarily due to (1) lower gross margin and (2) increased SG&A. These decreases were partially offset by increased net sales. The increased SG&A was primarily due to (1) $3 million of increased software subscription and consulting expenses, (2) $1 million of increased variable and distribution costs primarily driven by higher sales and (3) $1 million of higher SG&A associated with new retail store locations, including related employment costs, occupancy costs, administrative expenses and depreciation expense. These increases were partially offset by $2 million of decreased advertising costs.

Johnny Was:

The decreased operating results for Johnny Was was primarily due to (1) decreased net sales and (2) lower gross margin. These decreases were partially offset by decreased SG&A. The decreased SG&A was primarily due to (1) $2 million of decreased advertising costs, (2) $2 million of decreased amortization of intangible assets and (3) the absence of $1 million in Johnny Was Distribution Center costs incurred in the First Half of Fiscal 2024.

Emerging Brands:

The decreased operating income for Emerging Brands was primarily due to (1) increased SG&A and (2) lower gross margin. These decreases were partially offset by increased net sales. The increased SG&A was primarily due to new retail store operations, including related employment costs, occupancy costs, administrative expenses and depreciation expense.

Corporate and Other:

The lower operating results in Corporate and Other were primarily a result of increased SG&A. This decrease was partially offset by a $1 million lower LIFO accounting charge in the First Half of Fiscal 2025 relative to the First Half of Fiscal 2024. The increased SG&A was primarily due to (1) $4 million of increased employment costs primarily driven by increased incentive compensation, (2) $2 million of increased professional and consulting costs and (3) $1 million of increased costs associated with the project to build a new distribution center in Lyons, Georgia.

Interest expense, net

The increased interest expense in the First Half of Fiscal 2025 was primarily due to a higher average outstanding debt balance during the First Half of Fiscal 2025 than the First Half of Fiscal 2024.

Income tax

Our effective tax rate will vary from period to period from a typical annual effective tax rate of approximately 25% based on various factors including, but not limited to, the geographic mix of earnings, enacted tax legislation, state and local taxes, tax audit findings and settlements, and the interaction of various global tax strategies.

For the First Half of Fiscal 2025, our effective tax rate was 26.5%, which primarily reflects the unfavorable net discrete tax expense for shortfalls in stock-based compensation vesting during the First Half of Fiscal 2025 and a net increase in uncertain tax positions. These unfavorable factors were partially offset by the benefit derived from a reduction in income tax expense as a result of the receipt of interest from a U.S. federal income tax receivable and the remeasurement of deferred tax balances due to changes in state tax rates. On July 4, 2025, OB3 was enacted, reinstating bonus depreciation and accelerating the deduction for research and experimentation expenses previously capitalized and amortized under the Tax Cuts and Jobs Act of 2017 (“TCJA”). In the First Half of Fiscal 2025, we reflected the changes to certain timing differences in the current period that did not have a material net impact on income tax expense.

For the First Half of Fiscal 2024, our effective income tax rate was 24.0%, which primarily reflects the favorable net discrete tax benefits for stock-based compensation vesting during the First Half of Fiscal 2024.

Net earnings

Net earnings per diluted share was $2.83 in the First Half of Fiscal 2025 compared to $4.99 in the First Half of Fiscal 2024 reflecting (1) decreased net sales, (2) increased SG&A, (3) lower gross margin, (4) increased interest expense, (5) decreased royalties and other operating income and (6) a higher effective tax rate. These decreases were partially offset by a reduction in weighted average shares outstanding due to share repurchases made in the First Half of Fiscal 2025. Net earnings and gross margin in the First Half of Fiscal 2025 were impacted by approximately $10 million of increased cost of goods sold from additional tariffs enacted in Fiscal 2025, net of mitigation efforts.

FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES

Our primary source of revenue and cash flow is through our design, sourcing, marketing and distribution of branded apparel products bearing the trademarks of our Tommy Bahama, Lilly Pulitzer, Johnny Was, Southern Tide, TBBC, Duck Head and Jack Rogers lifestyle brands. We primarily distribute our products to our customers via direct to consumer channels of distribution, but we also distribute our products via wholesale channels of distribution.

Our primary uses of cash flow include the purchase of our branded apparel products from third party suppliers located outside of the United States, as well as operating expenses, including employee compensation and benefits, operating lease commitments and other occupancy-related costs, marketing and advertising costs, information technology costs, variable expenses, distribution costs, other general and administrative expenses and the periodic payment of interest. Additionally, we use our cash to fund capital expenditures and other investing activities, dividends, share repurchases and repayment of indebtedness, if any. In the ordinary course of business, we maintain certain levels of inventory, extend credit to our wholesale customers and pay our operating expenses. Thus, we require a certain amount of ongoing working capital to operate our business. Our need for working capital is typically seasonal with the greatest working capital requirements to support our larger spring, summer and holiday direct to consumer seasons. Our capital needs depend on many factors including the results of our operations and cash flows, anticipated growth rates, the need to finance inventory levels and the success of our various products.

Working Capital

Our working capital ratio is calculated by dividing total current assets by total current liabilities.

Balance Sheet

The following tables set forth certain information included in our consolidated balance sheets (in thousands). Below each table are explanations for any significant changes in the balances as of August 2, 2025 as compared to August 3, 2024.

Current Assets:

Cash and cash equivalents were $7 million as of August 2, 2025, compared to $18 million as of August 3, 2024. We aim to maintain a cash balance in our operations on an ongoing basis that ranges from $5 million to $10 million with any excess cash generally used to repay amounts outstanding under our U.S. Revolving Credit Agreement. The higher cash and cash equivalents as of August 3, 2024 was primarily due to excess cash resulting from the repayment of our long-term debt balance during the Second Quarter of Fiscal 2024.

The increased receivables, net as of August 2, 2025, was primarily due to increased tenant improvement allowance receivables due from landlords resulting from recent store openings.

Inventories, net, included an $85 million and $84 million LIFO reserve as of August 2, 2025, and August 3, 2024, respectively. Inventories increased in all reportable segments with the exception of Johnny Was due primarily to impacts associated with the U.S. tariffs that were implemented in the First Half of Fiscal 2025 including (1) accelerated purchases of inventory that were implemented to try and minimize the impact of potential, pending tariff increases and (2) increased costs capitalized into inventory after the implementation of the tariffs. As of August 2, 2025, our inventory balances included an additional $5 million of costs associated with the increased tariffs implemented in the First Half of Fiscal 2025.

We believe our strategy to accelerate the purchase of inventory during the First Half of Fiscal 2025 was appropriate to support our future anticipated sales plans.

The decreased income tax receivable as of August 2, 2025 was primarily due to the receipt of $19 million in income tax receivables in the Fourth Quarter of Fiscal 2024.

The increased prepaid expenses and other current assets as of August 2, 2025, was primarily due to increases in prepaid software costs and prepaid taxes.

Non-current Assets:

Property and equipment, net as of August 2, 2025, increased as capital expenditures primarily relating to the project to build a new distribution center in Lyons, Georgia and the opening of new Tommy Bahama Marlin Bars and retail stores across our portfolio exceeded depreciation during the 12 months ended August 2, 2025.

The decrease in intangible assets, net as of August 2, 2025, was primarily due to the amortization of intangible assets acquired in the acquisition of Johnny Was partially offset by the purchase of intellectual property rights by Lilly Pulitzer during the Fourth Quarter of Fiscal 2024.

Operating lease assets as of August 2, 2025, increased primarily due to the addition of new leased locations, and the extension of existing leased locations, exceeding the recognition of amortization related to existing operating leases and the termination or reduced term of certain operating leases.

The increase in other assets, net as of August 2, 2025, was primarily due to an increase in capitalizable implementation costs associated with cloud computing arrangements.

Deferred income taxes decreased as of August 2, 2025, due primarily to the enactment of OB3. The legislation includes, among other provisions, the restoration of current deductibility of previously capitalized domestic research expenditures and 100% bonus depreciation for qualified property.

Liabilities:

Current liabilities increased as of August 2, 2025, due to (1) increased accounts payable driven by the timing of payments and (2) increased accrued compensation driven primarily by increased accrued incentive compensation.

The increase in long-term debt as of August 2, 2025 was the result of (1) share repurchases, (2) capital expenditures primarily associated with the project to build a new distribution center in Lyons, Georgia, (3) payments of dividends and (4) working capital requirements exceeding cash flow from operations.

The non-current portion of operating lease liabilities increased as of August 2, 2025, due to the addition of new leased locations and extension of existing leased locations exceeding the payments related to existing operating leases and the termination or reduced term of certain operating leases.

Other non-current liabilities increased as of August 2, 2025 as a result of increases in (1) uncertain tax positions and (2) liabilities associated with our deferred compensation plans.

Statement of Cash Flows

The following table sets forth the net cash flows for the First Half of Fiscal 2025 and the First Half of Fiscal 2024 (in thousands):

Changes in cash flows in the First Half of Fiscal 2025 and the First Half of Fiscal 2024 related to operating activities, investing activities and financing activities are discussed below.

Operating Activities:

In the First Half of Fiscal 2025 and the First Half of Fiscal 2024, operating activities provided $80 million and $122 million of cash, respectively. The cash flow from operating activities for each period primarily consisted of net earnings for the relevant period adjusted, as applicable, for non-cash activities including depreciation, amortization of intangible assets, equity-based compensation, gain on sale of assets, and other non-cash items as well as the net impact of changes in deferred income taxes and operating assets and liabilities.

In the First Half of Fiscal 2025, the net change in operating assets and liabilities was primarily due to an increase in prepaid expenses, primarily prepaid income taxes, and other balance sheet changes that decreased cash flow from operations, partially offset by a decrease in receivables, including income tax receivables, and inventories and an increase in current liabilities that increased cash flow from operations. In the First Half of Fiscal 2024, the net change in operating assets and liabilities was primarily due to a decrease in current liabilities and other balance sheet changes that decreased cash flow from operations, partially offset by a decrease in inventories that increased cash flow from operations.

Investing Activities:

In the First Half of Fiscal 2025 and the First Half of Fiscal 2024, investing activities used $55 million and $54 million of cash, respectively. On an ongoing basis, our cash flow used in investing activities primarily consists of our capital expenditures, which totaled $55 million and $54 million in the First Half of Fiscal 2025 and the First Half of Fiscal 2024, respectively.

Financing Activities:

In the First Half of Fiscal 2025 and the First Half of Fiscal 2024, financing activities used $28 million and $57 million of cash, respectively. In the First Half of Fiscal 2025, we repurchased $57 million of shares of our stock, including $2 million of shares to cover employee tax liabilities related to the vesting of shares, and paid $21 million in dividends. In the First Half of Fiscal 2024, we paid $22 million in dividends and repurchased $6 million of shares to cover employee tax liabilities related to the vesting of shares of our common stock.

If net cash requirements exceed our net cash flows, we may borrow amounts from our U.S. Revolving Credit Agreement consistent with our use of long-term debt to satisfy cash flow needs during the First Half of Fiscal 2025. Alternatively, to the extent we are in a net debt position, if net cash requirements are less than our net cash flows, we may repay amounts outstanding on our U.S. Revolving Credit Agreement, if any.

Liquidity and Capital Resources

We have a long history of generating sufficient cash flows from operations to satisfy our cash requirements for our ongoing capital expenditure needs as well as payment of dividends and repayment of our debt. Thus, we believe our anticipated future cash flows from operating activities will provide (1) sufficient cash over both the short and long term to satisfy our ongoing operating cash requirements, (2) funds to complete our multi-year project to build a new distribution center in Lyons, Georgia to enhance the direct to consumer throughput capabilities of our brands, (3) funds to continue to invest in our businesses, including direct to consumer initiatives and information technology projects, (4) additional cash flow to repay debt that may be outstanding and (5) sufficient cash for other strategic initiatives such as acquisitions and share repurchases.

To the extent cash flow needs, for acquisitions or otherwise, in the future exceed cash flow provided by our operations, we will have access, subject to its terms, to our $325 million U.S. Revolving Credit Agreement to provide funding for operating activities, capital expenditures and acquisitions, if any, and any other investing or financing activities. The U.S. Revolving Credit Agreement matures in March 2028.

We issue standby letters of credit under the U.S. Revolving Credit Agreement. Outstanding letters of credit under the U.S. Revolving Credit Agreement reduce the amount of borrowings available to us when issued and, as of August 2, 2025, February 1, 2025, and August 3, 2024, totaled $5 million, $5 million and $5 million, respectively.

As of August 2, 2025 and February 1, 2025, we had $81 million and $31 million, respectively, of borrowings outstanding and $239 million and $289 million, respectively, in unused availability under the U.S. Revolving Credit Agreement. As of August 3, 2024, we had no borrowings outstanding and $306 million in unused availability under the U.S. Revolving Credit Agreement.

Our cash, short-term investments and debt levels in future periods may not be comparable to historical amounts as we continue to assess, and possibly make changes to, our capital structure, including borrowings from additional credit facilities, sales of debt or equity securities or the repurchase of shares of our stock in the future. Changes in our capital structure, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors. The amounts involved may be material.

Compliance with Covenants

The U.S. Revolving Credit Agreement is subject to a number of affirmative covenants regarding the delivery of financial information, compliance with law, maintenance of property, insurance requirements and conduct of business. Also, the U.S. Revolving Credit Agreement is subject to certain negative covenants or other restrictions including, among other things, limitations on our ability to (1) incur debt, (2) guaranty certain obligations, (3) incur liens, (4) pay dividends to shareholders, (5) repurchase shares of our common stock, (6) make investments, (7) sell assets or stock of subsidiaries, (8) acquire assets or businesses, (9) merge or consolidate with other companies or (10) prepay, retire, repurchase or redeem debt.

Additionally, the U.S. Revolving Credit Agreement contains a financial covenant that applies only if excess availability under the agreement for three consecutive business days is less than the greater of (1) $23.5 million or (2) 10% of availability. In such case, our fixed charge coverage ratio as defined in the U.S. Revolving Credit Agreement must not be less than 1.0 to 1.0 for the immediately preceding 12 fiscal months for which financial statements have been delivered. This financial covenant continues to apply until we have maintained excess availability under the U.S. Revolving Credit Agreement of more than the greater of (1) $23.5 million or (2) 10% of availability for 30 consecutive days.

We believe that the affirmative covenants, negative covenants, financial covenants and other restrictions under the U.S. Revolving Credit Agreement are customary for those included in similar facilities entered into at the time we amended the U.S. Revolving Credit Agreement. During the First Half of Fiscal 2025 and as of August 2, 2025, no financial covenant testing was required pursuant to the U.S. Revolving Credit Agreement, as the minimum availability threshold was met at

all times. As of August 2, 2025, we were compliant with all applicable covenants related to the U.S. Revolving Credit Agreement.

Operating Lease Commitments:

Refer to Note 4 in our unaudited condensed consolidated financial statements included in this report for additional information about our operating lease commitments as of August 2, 2025.

Dividends:

On September 9, 2025, our Board of Directors approved a cash dividend of $0.69 per share payable on October 31, 2025 to shareholders of record as of the close of business on October 17, 2025. Although we have paid dividends each quarter since we became a public company in July 1960, we may discontinue or modify dividend payments at any time if we determine that other uses of our capital, including payment of outstanding debt, funding of acquisitions, funding of capital expenditures or repurchases of outstanding shares, may be in our best interest; if our expectations of future cash flows and future cash needs outweigh the ability to pay a dividend; or if the terms of our credit facility, other debt instruments or applicable law limit our ability to pay dividends. We may borrow to fund dividends or repurchase shares in the short term subject to the terms and conditions of our credit facility, other debt instruments and applicable law. All cash flow from operations will not be paid out as dividends.

Share Repurchases:

As disclosed in our Quarterly Report on Form 10-Q for the Third Quarter of Fiscal 2024, on December 10, 2024, our Board of Directors authorized us to spend up to $100 million to repurchase shares of our stock. This authorization superseded and replaced all previous authorizations to repurchase shares of our stock. During the First Quarter of Fiscal 2025, we repurchased 842,007 shares of our common stock at an average price of $59.38 for $50 million as part of an open market repurchase program (Rule 10b5-1 plan) in accordance with the December 10, 2024 authorization.

On March 24, 2025, our Board of Directors authorized us to spend up to $100 million to repurchase shares of our stock. This authorization superseded and replaced all previous authorizations to repurchase shares of our stock and has no automatic expiration. During the Second Quarter of Fiscal 2025, we repurchased approximately 114,477 shares of our common stock at an average cost of $40.46 for $5 million in open market repurchases under the March 24, 2025 authorization. During the First Half of Fiscal 2025, we repurchased a total of 956,484 shares at an average cost of $57.12 for $55 million. During the Second Quarter of Fiscal 2024 and First Half of Fiscal 2024, there were no repurchases.

As of August 2, 2025, $95 million remained under the Board of Director's authorization.

Capital Expenditures:

Capital expenditures of $55 million for the First Half of Fiscal 2025 increased compared to the $54 million in the First Half of Fiscal 2024. Our capital expenditures in the First Half of Fiscal 2025 related primarily to (1) the multi-year project to build a new distribution center in Lyons, Georgia to create a modern and more efficient distribution center for our brands and (2) Tommy Bahama Marlin Bar locations and retail store openings across our portfolio.

Other Liquidity Items:

Our contractual obligations as of August 2, 2025 except for the increased debt outstanding, as discussed above, have not changed materially from the contractual obligations outstanding at February 1, 2025, as disclosed in our Fiscal 2024 Form 10-K. We have not entered into agreements which meet the SEC’s definition of an off balance sheet financing arrangement, other than operating leases, and have made no financial commitments or guarantees with respect to any unconsolidated subsidiaries or special purpose entities.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

The discussion and analysis of our financial condition and results of operations are based upon our condensed consolidated financial statements, which have been prepared in accordance with GAAP in a consistent manner. The preparation of these financial statements requires the selection and application of accounting policies. Further, the application of GAAP requires us to make estimates and judgments about future events that affect the reported amounts of

assets, liabilities, revenues and expenses and related disclosures. We base our estimates on historical experience, current trends and various other assumptions that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources.

Actual results may differ from these estimates under different assumptions or conditions. We believe it is possible that other professionals, applying reasonable judgment to the same set of facts and circumstances, could develop and support a range of alternative estimated amounts. We believe that we have appropriately applied our critical accounting policies. However, in the event that inappropriate assumptions or methods were used relating to the critical accounting policies, our consolidated statements of operations could be materially misstated.

Our critical accounting policies and estimates are discussed in Part II, Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Fiscal 2024 Form 10-K. There have not been any significant changes to our critical accounting policies and estimates during the Second Quarter of Fiscal 2025. A detailed summary of significant accounting policies is included in Note 1 to our consolidated financial statements contained in our Fiscal 2024 Form 10-K.

SEASONAL ASPECTS OF OUR BUSINESS

Each of our operating segments is impacted by seasonality as the demand by specific product or style, as well as by distribution channel, may vary significantly depending on the time of year. As a result, our quarterly operating results and working capital requirements fluctuate significantly from quarter to quarter. Typically, the demand for products for our larger brands is higher in the spring, summer and holiday seasons and lower in the fall season (the third quarter of our fiscal year). Thus, our third quarter historically has had the lowest net sales and net earnings compared to other quarters. Further, the impact of certain unusual or non-recurring items, economic conditions, our e-commerce flash clearance sales, wholesale product shipments, weather, acquisitions or other factors affecting our operations may vary from one year to the next. Therefore, due to the potential impact of these items, we do not believe that net sales or operating income in the Second Quarter of Fiscal 2025 is indicative of the expected proportion of amounts by quarter for future periods.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are exposed to certain interest rate, foreign currency, commodity and inflation risks as discussed in Part II, Item 7A, Quantitative and Qualitative Disclosures About Market Risk in our Fiscal 2024 Form 10-K. There have not been any material changes in our exposure to these risks during the Second Quarter of Fiscal 2025 other than our increased exposure to interest rates resulting from our increased borrowings relative to February 1, 2025.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Our company, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, have evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Based upon that evaluation, our principal executive officer and our principal financial officer concluded that, as of the end of the period covered by this report, our disclosure controls and procedures were effective.

Changes in Internal Control over Financial Reporting

There were no changes in our internal controls over financial reporting identified in connection with the evaluation required by Rule 13a-15(d) of the Exchange Act during the Second Quarter of Fiscal 2025 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

From time to time, we are a party to litigation and regulatory actions arising in the ordinary course of business. These actions may relate to trademark and other intellectual property, employee relations matters, real estate, licensing

arrangements, importing or exporting regulations, product safety requirements, consumer regulations, taxation or other topics. We are not currently a party to any litigation or regulatory action or aware of any proceedings contemplated by governmental authorities that we believe could reasonably be expected to have a material impact on our financial position, results of operations or cash flows. However, our assessment of any litigation or other legal claims could potentially change in light of the discovery of additional factors not presently known or determinations by judges, juries, or others which are not consistent with our evaluation of the possible liability or outcome of such litigation or claims.

ITEM 1A. RISK FACTORS

Our business is subject to numerous risks. Investors should carefully consider the factors discussed in Part I, Item 1A. Risk Factors in our Fiscal 2024 Form 10-K, which could materially affect our business, financial condition or operating results. We operate in a competitive and rapidly changing business environment and additional risks and uncertainties that we currently consider immaterial or are not presently known to us may also adversely affect our business. The risks described in our Fiscal 2024 Form 10-K, as amended and updated in our Quarterly Report on Form 10-Q for the First Quarter of Fiscal 2025, are not the only risks facing our company.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

(a)During the Second Quarter of Fiscal 2025, we did not make any unregistered sales of equity securities.

(c)During the Second Quarter of Fiscal 2025, we repurchased the following shares of our common stock:

On March 24, 2025, our Board of Directors authorized us to spend up to $100 million to repurchase shares of our stock. This authorization superseded and replaced all previous authorizations to repurchase shares of our stock and has no automatic expiration. During the Second Quarter of Fiscal 2025, we repurchased approximately 114,477 shares of our common stock at an average cost of $40.46 for $5 million in open market repurchases under the March 24, 2025 authorization. As of August 2, 2025, $95 million remained under the Board of Directors' authorization.

Also, we have certain stock incentive plans as described in Note 9 of our Fiscal 2024 Form 10-K, all of which are publicly announced plans. Under the plans, we can repurchase shares from employees to cover employee tax liabilities related to the vesting of shares of our stock. During the Second Quarter of Fiscal 2025, we repurchased $2 million of shares from employees.

ITEM 5. OTHER INFORMATION

(c)During the Second Quarter of Fiscal 2025, none of our directors or officers adopted or terminated a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408 of Regulation S-K.

ITEM 6. EXHIBITS

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3.1 Restated Articles of Incorporation of Oxford Industries, Inc. (filed as Exhibit 3.1 to the Company’s Form 10-Q for the fiscal quarter ended July 29, 2017) 3.2 Bylaws of Oxford Industries, Inc., as amended (filed as Exhibit 3.2 to the Company’s Form 10-Q for the fiscal quarter ended August 3, 2024) 31.1 Section 302 Certification by Principal Executive Officer.* 31.2 Section 302 Certification by Principal Financial Officer.* (32) Section 906 Certification by Principal Executive Officer and Principal Financial Officer.** 101.INS XRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL Document 101.SCH XBRL Taxonomy Extension Schema Document* 101.CAL XBRL Taxonomy Extension Calculation Linkbase Document* 101.DEF XBRL Taxonomy Extension Definition Linkbase Document* 101.LAB XBRL Taxonomy Extension Label Linkbase Document* 101.PRE XBRL Taxonomy Extension Presentation Linkbase Document* (104) Cover Page Interactive Data File – The cover page interactive data file does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document | | * Filed herewith. | | | **Furnished herewith. This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liability of that Section. Such exhibit shall not be deemed incorporated into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934. |