Good day ladies and gentlemen welcome to the Oxford Industries, Third Quarter Fiscal 2015 Earnings Conference Call. Today's conference is being recorded. At this time, I’d like to turn the floor over to Ms. Anne Shoemaker for opening remarks and introductions.

Thank you, Katherine, and good afternoon everyone. 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 fiscal 2014 Form 10-K and our second quarter fiscal 2015 Form 10-Q. 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 GAAP financial measures to certain non-GAAP financial measures in our press release issued earlier today, which is posted under the Investor Relations tab of our website at oxfordinc.com. Please note that all financial results and outlook information discussed on this call, unless otherwise noted are from continuing operation and all per share amounts are on a diluted basis. As a reminder, the results from the Ben Sherman business are reflected as discontinued operation for all periods presented. And now, I'd like to introduce today's call participants. With me today are Tom Chubb, Chairman and CEO; Scott Grassmyer, CFO; Terry Pillow, CEO of Tommy Bahama; and Doug Wood, President and CEO elect of Tommy Bahama. 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 generally pleased with our results for the third quarter, which due to the seasonality of our brands is our smallest quarter. Our bottom line loss of $0.08 per was at the top end of our forecast. Across the Company we went into the quarter with the inventories in excellent shape, and that combined with good execution allowed us to leave the quarter with inventory still in excellent shape while driving a gross margin expansion. Lilly Pulitzer had another outstanding quarter. Sales were excellent as the customers responded well to our Resort 360 type strategy, and its ample offering of buy-now wear-now product during the third quarter. Lilly was able to deliver growth of 22%, driven by an amazing comp stores sales increase of 27%, while at the same time expanding gross margin. We have opened six Lilly stores this year, including our Coconut Point location north of Naples which we opened in September. We are delighted that all of these stores are exceeding our expectations to-date. As you know doubt recall, our twice a year e-commerce flat sale at Lilly in January and August is our primary vehicle within the brand for clearing residual inventory. The August sale has historically been a three-day event, but this year we shortened it to two days, delivered a record $13.4 million of sales, and fundamentally cleaned our inventories out at a solid gross margin. Not only is the flash sale an excellent clearance mechanism, but we believe it also helps actually reinforce our connection with our loyal consumer by creating a high level of excitement and social media chatter. To our many positive developments at Tommy Bahama during the quarter packed with its broader footprint, the Tommy Bahama business was not immune to…

Thanks, Tom. As Tom mentioned, our third quarter is our smallest sales quarter and as planned, we reported a modest loss for the quarter. I'll walk you through some more detail on sales, gross margin and SG&A. So please refer to our press release for the complete results by group and for the Company as a whole. Consolidated net sales were $199 million, compared to $201 million last year. Lilly had a remarkable quarter and increased sales by $8 million, with increases in all channels and distribution. This was offset by a $9.7 million sales decrease at one year close, with the year-over-year decrease coming primarily from the private label business. Tommy Bahama's sales decline 1% in the quarter with a decrease in wholesale sales primarily due to lower all price sales than last year. With the reduction in traffic in our retail stores we saw Tommy comp store sales decline by 5%. On a consolidated basis, our gross margin expanded over 260 basis points with improvements in all operating groups. Lilly Pulitzer, which has higher gross margin than our other operating groups represented a greater proportion of sales in the quarter. But Tommy Bahama and Lilly Pulitzer had a change in sales mix towards full price direct to consumer sales. At one year close, the change in sales mix reflected a higher proportion of branded sales. In the third quarter SG&A as adjusted was $112 million compared to $102 million last year. The increase in SG&A was primarily due to incremental cost associated with operating additional retail locations. For reference, in the quarter it was $1.3 million of pre-opening expenses associated with Tommy Bahama's Waikiki retail restaurant location. The increase in occupancy cost associated with Tommy Bahama's move to new office space in the quarter was $1.6 million. For…

Thank you. [Operator Instructions] We'll go to Ed Yruma with KeyBanc Capital Markets.

I guess first on the guidance revision, just trying to check a little bit on where 4Q may be coming in softer to plan. So you ended 3Q with earnings that were in line or -- at 4Q you said you're comping positive both brands. I guess with the reduction in guidance is it a topline weakness you're embedding? Are you anticipating or are you observing that margins are coming in weaker than you would have hoped? A little bit of color there would be helpful.

Ed, thanks for your call today. And I think our concern really is just that we see risk to the topline as we stated in the call or in the prepared remarks. Our comps have been good. So far we were pleased with what we saw in comps in November and it's continued into December. Our concern really stems from what we see happening in the external environment, just with some of the traffic issues that are being reported, the amount of promotion and discounting that's going on in the marketplace, and then some of the reports that you see of people getting backed up on inventory, which is going to lead them probably to promote even more in discount, even more so. We're concerned that at some point the level of distraction out there from all that could -- to the consumer could end up impacting our topline a bit. And so it’s really the external factors, not really so much what we're currently seeing in our business.

Got it. And on the promotional environment, I guess what's your openness to execute a promotional contingency? Should maybe some retailers that sell your product execute those? And then I guess as a follow up, in terms of wholesale inventory or inventory in channels for both Tommy and Lilly, how would you gauge it maybe versus where it was this time last year.

Ed, with respect to the first part of it is you know we're very committed to our full price selling strategy. We do, do some marketing all year long and particularly during the holiday season. That's designed to spur sales. But in terms of us going to you know thirty off the whole store, something like that, as you see with a lot of other retailers, I just don't see it happening. With respect to performance at wholesale, I think we're all seeing the same reports from some of the big retailers and third party brands, department stores and others, and I think those guys, they've had some difficult times compared to a year ago, but it is still relatively early and I think time will tell. If you know we're not overly dependent on that channel distribution in either brand.

Thank you. Our next question comes from Rick Patel with Stephens.

Can you give us -- I guess just a follow up on Ed's earlier question on the guidance; can you give us some general context as to how much of your quarterly sales have already occurred for the fourth quarter to date? I figure we're almost halfway through the quarter here. So I'm wondering if the bulk of your sales have already happened or if they're still ahead of you as we think about that positive comp in November and December, and how much weight that should carry from a modelling perspective.

You know, I don't know that we have the exact number handy for you Rick. It’s a good question, but I think we'd be fairly safe in assuming that we still have more than half to go.

Yes, we do. And you remember, we've got the important resort travel business. So our holiday you know rolls right into a strong period for us, which is resort. So it’s a much more [indiscernible]. The post-holiday shopping is much more important to us than it is to many of our competitors. So I think we have -- I don't we're halfway through yet. I think we've got more ahead of us than behind us.

And could you update us on Tommy women, perhaps a little more color there on the performance relative to expectations and any initial reads on the spring product based on what you're seeing in your order book, given some the merchandising effort there?

Yes, I'll let may Doug elaborate on this a little bit, and look, it's really early. The Resort product that's on the floor is really the first product that's being designed by our new women's design team. But we're seeing some positive things there and then of course in spring, we'll have a good dose of it and I think get a lot of more insights. But Doug may want to elaborate on that a little.

Yes. The first two deliveries of holiday were really our new design teams, us actually getting out of retail and it's been successful and it's a directional thing. Specially it's not ready to hit the floor for December. So it's going to happen in spring. With regard to the order book for spring, our women's sportswear business is still pretty small and we did book the product well, but selling it on the floor in retail, that will be something that we will be watching in spring. Overall, women has been actually performing very well in November and beginning of December.

Great. And then a question on gross margins also. It seems like a number of positive factors came together in the third quarter with the sales mix outperforming at Lilly and retail being a bigger piece of buy. Should we expect those same elements to stay in place in the fourth quarter as we think about the gross margin book or is it safe to assume that things will moderate a little bit versus the third quarter, given the promotional environment out there and the just choppiness in same store sales?

Well, I think you have the factors that you've cited Rick. You also had a meaningful decrease in off price wholesale at Tommy Bahama during Q3, and then you had a shift in Lanier margins as the result of their mix. That also helped with the gross margins. So I don't think we're looking for deterioration in Q4, but I think they're more flat to last year as opposed to seeing sequential gross margin improvement. But we think in this environment flattish is a pretty good story.

Great, and then just long last one if I may. Leadership change is going on at both Tommy and Lilly end and I know that Doug and Michelle understand these businesses extremely well. But as we think about 2016, is there any potential for either of these concepts to undergo a change in strategy versus what we've seen in the past or do you think they both continue to head down the right strategic path?

We very much believe in the strategy that we have in place in these businesses. The strategies will evolve each year as they always have, but part of the attraction of Michelle and Doug as leaders is that they understand the strategies, they understand the businesses, they know and understand the people in the business the customer and they've been a big part of building the teams. And given that these our two highly successful businesses, what we're looking is continuity and an ability to continue to adapt to changes in the market and in the environment, and Doug and Michelle we think we've got the best leaders we could possibly have for each of those businesses. We feel really good about that.

We'll go onto Eric Beder with Wunderlich.

Could you give us an update on -- and how that market has been evolving now in Q3 and how it is it looking for the holiday season?

Yes, I'll come on it briefly and let Doug elaborate on it. But of course it's still very small and of course we still have the issues which we're focused on of an oversized infrastructure. But against the backdrop, we did make year-over-year improvement by about $400,000 in the quarter and we've actually been comping quite nicely over there. The performance of the business at a store level over their year-to-year has been very encouraging. And Doug can give you a little more color on that. And Erik, it hadn't gone away as an issue for us, but there are a lot of things we like about that's happening over there right now.

Yes, the only think I would add and it really because we're talking about Japan and Australia, two different markets, but two markets that on an overall basis we are seeing some nice growth. And specifically in Japan we've got some pockets [ph] signed in Japan that for this -- for cold weather there's been outerwear that has really driven those sales. So the localization piece that we knew was an issue when we started this, that's really coming together and it's really helping our results. And then on Australia, that has been just a real success for us this year, and it just build a small part of our overall mix.

Okay. And you look at Lilly Pulitzer, you had a fantastic year at Lilly. What do you look at next year in terms of store expansion potential? Where is like the next level here for Lilly Pulitzer?

I think Eric, as you've heard from us before, we love what's happened in Lilly Pulitzer's since we brought it almost five years ago. It's basically tripled in sales and close to 5x I think in operating profit. So a pretty impressive record in our view over the last five years and we think there is a lot of runway ahead of it. We expect to grow again next year. I don’t want to get into giving guidance before we're ready to give guidance but we think Lilly can keep going for sure. And it will be driven by direct to consumer, so be driven by ecommerce and retail but wholesale will continue to be an important part of the Lilly Pulitzer world as well.

And lastly, speaking of wholesale for Tommy Bahama, I know women's has not been a big piece of that business. Given that you are upgrading the women's line significantly, how should we start thinking about women's potential to be more wholesale driven than it has been historically?

Eric, I'm going to take that one and tell you that I think that's something that we need to patient with. Tommy Bahama has been around this brand for over 20 years and has been known and as you know more as the men's brand than women's brand. And we do think there is a great wholesale opportunity for women's out there. But it just won't happen overnight. People are going to want to see results in our own stores as well as in the existing wholesale business that we have. So I think it's going to take a while for women's wholesale to ramp up. But I do think the opportunity is there over the longer term. You won't see it in spring.

[Operator Instructions]. Will go to Pamela Quintiliano with SunTrust.

So few questions. I'm going back to guidance, just a point of clarification. With Tommy and Lilly both comping positive, is that in line above the well your internal expectations for this point in the quarter. And can you also remind us the cadence of the quarter last year as it progressed? And then lastly, just how you've planned inventories both divisions for year end?

Okay. So starting with the first one about where we are in terms of our expectations for the quarter; I think broadly speaking we're happy with where we are at the moment. Our concern is just whether the environment deteriorates further the external environment and makes it difficult for us to maintain the level of performance that we've had thus far in the quarter. On the cadence of events during the quarter last year, I think we were pretty strong through the whole quarter. If I remember right I'm looking at -- Scott, you may be can tell.

Yes. We were, but the Thanksgiving weekend is not quite as important to us. It's important but not as important to us as some retailers and I think when you get further in December, it's very, very important. And again when you get into later December and early January, we still have some really-really important week. So we still have a whole lot of holiday ahead of us. Calendar resort is part of that. So like Tom said we're pleased with the comps right now but we've got a long way to go.

And on the inventories, plans for year end?

Inventories are in great shape. I think we're only at 2% on a consolidated basis, and that's on a much bigger business. So I know at Tommy both the full price stores and the outlets will have lower inventories on a comp basis, which means that even if there was a little back up, if holiday went south, there is room to move goods and Lilly's inventories are in excellent shape. So we're very pleased that we went into the third quarter with inventory in very good shape. We did not have to be overly promotional, the way a lot of people are having to be and we exited the quarter with good gross margins and inventories in very good shape. So we're very, very pleased with the way our inventory is sitting right now.

And just you being conservative with your approach as we think about per year end with inventory, even though you're having good quarters, it's not as though you made costly assumptions with your inventory commitments.

Right so we have I mean, we have the inventory to do business. We have very good clearance channels and we're not -- we're really not worried that we’re going to end somehow overstocked, that we would have a kind of inventory problem.

Okay and then a few follow ups. If you could give any granularity on performance wholesale, retail, e-com, that's something that has been doing very well for you guys, particularly at Lilly, and then Waikiki, anything you could share with us about how it's gone so far. I know it’s still early days but then you guys have been very excited about it.

Yes, I'll start with the first part first and then let Doug elaborate a little on Waikiki, because he and Terry have recently been over there. But in terms of wholesale, retail and e-commerce, I think our retail has performed well quarter to date. E-commerce has performed better quarter to date which is sort of the story that's been the case for the last several years. And then in the wholesale channel as we talked about in response to an earlier question, what you read out there suggests that some people -- some of the retailers may be having a tougher quarter so far. But it is still early for them. So they've got a long way to go too.

Okay and as far as Waikiki?

Doug, do you want to give her some of the?

Yes, the great thing about Waikiki and any time you have a portfolio with kind of expectations are first take did it meet your expectations overall? Did [indiscernible] or did it get built correctly? Is it delivering the brand message? And the answer is we don't have a more beautiful facility than Waikiki. And then the next thing is are the staff ready or the -- ready to do business. And on the first day we look like we've been open for years, and the staff was ready to great. And then the last and most important thing, are we doing business and we're doing a lot of business. And so, so far we're a little bit over the moon over Waikiki, and it's really, really early, because this facility we're expectation not to just be talking to North American guests but international guests, and we're doing corporate business out of there. So I think Terry and does this really exceed our expectations for all three areas and we're looking forward to some good things.

Pamela it’s Terry, and you know how excited I am about New York and city of New York and [indiscernible]. Doug and I discussed that from Waikiki when I walked in there. It is a -- we dropped our jaw when we walked in there. It's just quite incredible to see what we built there, how much business it’s doing [indiscernible] the guest is in that [indiscernible]. So it's a crowning achievement for us for sure.

And have you guys being seen a new customer coming in? Can you tell the others that the customer is familiar with Tommy already?

Yes, the answer is -- our biggest surprise is the number of locals we're seeing, because -- especially on [indiscernible], it's right down the heart -- it's a little bit like New York City. If you don't work down on Fifth Avenue, you usually go down there and shop, a little bit like that in Hawaii. But from a local stand we're getting a lot of locals that are coming in for dinner and sitting across the bar. We are seeing a new guest. It's a younger guest in that area that's quite exciting, and it's the cadence of Waikiki at the time period where the Japanese are necessarily heavy into Waikiki. At the same time, we already are reaching out and we've got some Japanese wedding parties coming in, which is important for the restaurant. So there's a lot -- it's such a crossroads of people that we’re touching. So you're getting a little bit of everything.

And then just very last question I promise on this. So you're seeing similar types of conversion in New York. It seems like people come in, they have a cocktail they like walking around the stores. Sometimes it inspires them to spend when they're in the stores higher than they would in the stand alone. Are you seeing similar types of conversion thus far?

You know you actually see -- the good news about Waikiki is that to get to the restaurant, you got to walk right through the middle of the store. So I like their conversion matter than what we have in New York and we're happy with what we have in New York. It's just really, anytime you have a restaurant where coming and going you're pretty much forced to go in between what we're selling is always what we prefer.

Thank you. And we'll go to Raghav Nayar with Sidoti.

Hi, everyone. Nice job at Lilly. My first question is I know you can't give guidance about 2016, but first going to talk Bahama women. How should we think about the changes that you've made with that assortment in full price stores as it relates to comp and for margin, one really more important than the other here strategically.

Doug, do you want to answer that question?

Well, so typically how we're looking at it in '16 is we're first focused on -- if you look at our stores right now, and why we put so much emphasis into women, is that we haven't been happy with the sales group and the performance in our full price stores and we haven’t been particularly happy with what we're getting online. So we're being very conservative on our '16 projections and just really focused on first sale through in our stores. And so I wouldn't say that we're doing anything in '16 other than really expectation-wise being fairly conservative, at the same time knowing that what we put on the floor should sell through better and whatever we've had before.

And just also on Hawaii, just thought was general its market. How does store productivity fair year versus your other warm-weather location or Bahama?

Doug, you want me to take that?

Yes, in regards -- your speaking Hawaii in general?

Right, Hawaii in general.

Yes, I'll tell you that Hawaii is a terrific market for some of our best stores are really in Hawaii. And Doug, I don't know if you want to comment more on productivity levels versus other warm-weather markets. I think we got -- a lot of our warm-weather markets tend to be very strong markets for us if you would expect. But Doug I don't know if you've got.

Yes, I think the only thing I would add that makes Hawaii special to all other markets is that we're always talking about our women's initiative and what we're focused on in sportswear, where we have a very strong women's swimwear business, and in Hawaii you're in the women's swimwear business 12 months a year. So just the fact that we can sell women's swim around the year in Hawaii makes all of our stores more productive than what I typically can do in the U.S. And if anything I'll also let it be probably over as we really push on sportswear is that confidence that what we're seeing going on with swimwear in Hawaii is that look we can sell women's sportswear as well and this is the type of impact you're going to have on your business.

Great and my last question is on Lilly. Could you talk about the general the marketing strategy, in third quarter what you did and then lastly in fourth quarter and what do you [Indiscernible] to spring, anything that you could share with us?

Well, I think the big thing in the third quarter that drove a lot of the business, the communication and marketing throughout the year has been outstanding. Product throughout the year has been outstanding. I think the key to the third quarter in Lilly Pulitzer was this year we did what we called resort fall as opposed to just fall. So it's really fundamentally resort product offered during the fall selling period and while sort of traditional fall product is not a strength for Lilly Pulitzer resort product very much is. And then when you think of a timeframe that product is actually on the floor hitting in July, August, September, in much of the country, it's still quite warm including Lilly's key markets. So what happened was the customer responded very well to it. It's almost like it's an extension of the spring summer season, but it's a time of the year when that product can still be borne sort of buy now, wear now type of product. And it really worked, as you can see in the results. It's still a small quarter for Lilly. But when you compare it year-to-year, the sell through that we got on fall '15 product was significantly better than what we got on fall '14 product. And I think that’s really the product strategy as much as anything that drove that.

And with no additional questions in the queue, I'd like to turn the floor back over to Tom Chubb.

Thank you again for you time this afternoon. We're looking forward to an exciting holiday in resort season. Appreciate your interest in our company and look forward to speaking to you gain next year.

Thank you. And ladies and gentlemen again that does conclude today's conference. Thank you all again for your participation.