Oxford Industries Inc announced that its Board of Directors has authorized the repurchase by the Company of up to $60 million of its outstanding common stock, replacing the Company's previously announced stock repurchase authorization.
The Company expects to enter into an accelerated share repurchase agreement with Bank of America, N.A. for the full amount of the $60 million authorization. The $60 million represents approximately 14% of the Company's current market capitalization.
"We believe in the strength of our company and that the repurchase of shares at this time is an excellent opportunity to deliver value to our shareholders," commented J. Hicks Lanier, Chairman and Chief Executive Officer of Oxford Industries, Inc. "At the same time, we remain committed to building a portfolio of lifestyle brands and this share repurchase will not prevent us from pursuing future transactions aligned with this strategy."
The specific number of shares to be repurchased under the agreement with Bank of America generally will be based on the volume weighted average share price of the Company's common shares during a specified calculation period.
During the share repurchase program, a price cap provision will establish the maximum price payable by the Company for the shares to be repurchased under the agreement. The program is expected to take up to seven months to complete. The Company will fund the share repurchase through borrowings under its U.S. revolving credit facility.
The Company reaffirmed its earnings guidance for the second quarter ending November 30, 2007 and the two month period ending February 2, 2008. Earnings for each of those periods, without giving effect to the share repurchase, are expected to be flat to slightly higher than the comparable periods last year.
For the second quarter of fiscal 2007 and for the two months ended February 2, 2007 diluted earnings from continuing operations per common share were $0.68 and $0.16 respectively. Due to the anticipated timing of the delivery of shares, the Company expects the share repurchase transaction to have minimal impact on earnings per share in the eight month period ended February 2, 2008.
The Company updated its guidance for net sales for the second quarter ending November 30, 2007 and the two month period ending February 2, 2008. Net sales are now expected to be slightly below the comparable periods last year. For the second quarter of fiscal 2007 and the two months ended February 2, 2007, net sales were $291.0 million and $164.4 million, respectively.
Oxford Industries Inc
