What led to Oxford Industries Inc (NYSE: OXM) stock crash

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Oxford Industries Inc (NYSE: OXM) stock lost over 13.2% on 11th June, 2020 (as of 10:24 am GMT-4; Source: Google finance) after the company posted lower than expected results for the first quarter of FY 20. The company has reported a fiscal first-quarter loss of $66.8 million compared to net income of $21.7 million, in the year-ago period. The company will not be providing an outlook for 2020 because of the COVID-19 pandemic while the analysts are projecting earnings to be of $1.62 a share on revenue to be of $917.3 million. Meanwhile, the company had closed all of the North American stores and restaurants on March 17 but remained connected with customers through the e-commerce and digital platforms. E-commerce formed 23% of the company’s revenue in 2019, posted growth of 12% in the first quarter. The company had reopened its first stores in early May, and currently the company has a little more than half of the 225 locations opened and expects to have almost all locations open by the end of June.

Meanwhile, in the first quarter of fiscal 2020, the net sales in each of the operating groups declined from prior periods, that resulted in significant lower operating results, including operating losses in each group other than Lilly Pulitzer. The company has reduced and canceled the existing orders, had reduced the amount of the previously planned forward orders, and has delayed and remerchandised inventory that was already in the pipeline. At the end of the first quarter, the company had $208 million of borrowings outstanding, an additional $114 million of unused availability and $182 million of cash and cash equivalents. The cash flow from operations used was of $46 million in the first quarter compared to a use of $6 million in the prior year period.

OXM in the first quarter of FY 20 has reported the adjusted loss per share of $1.12, missing the analysts’ estimates for the adjusted loss per share of 27 cents, according to analysts surveyed by FactSet. The company had reported 43 percent fall in the adjusted revenue to $160.3 million in the first quarter of FY 20, missing the analysts’ estimates for revenue of $172.5 million.

Additionally, the company had reduced the quarterly dividend from $0.37 per share to $0.25 per share in the last quarter, which will be paid on July 31. The company has also elected to reduce its cash compensation by 50% for the remainder of the fiscal year.

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