MANAGEMENT DISCUSSION AND ANALYSIS OF OXFORD INDUSTRIES INC. OF THE FINANCIAL POSITION AND OPERATING RESULTS (Form 10-Q)


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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 2020
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
and Southern Tide lifestyle brands and other brands. Tommy Bahama and Lilly
Pulitzer, in the aggregate, represent more than 85% of our net sales and 97% of
our net sales are in the United States.

Our business strategy is to develop and market compelling lifestyle brands and
products that evoke a strong emotional response from our target consumers. 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,
like Tommy Bahama, Lilly Pulitzer and Southern Tide, 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 directly related to 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 products
each season.

We generate our net sales primarily through our direct to consumer channels of
distribution, which consist of our brand-specific full-price retail stores, our
brand-specific e-commerce websites, our Tommy Bahama food and beverage
operations and our Tommy Bahama outlets. Our remaining net sales are generated
through our wholesale distribution channels. Our wholesale operations consist of
net sales of products bearing our lifestyle brands, which complement our direct
to consumer operations and provide access to a larger group of consumers, and
the net sales of our Lanier Apparel operating group, which we exited during
Fiscal 2021.

For additional information about our business and each of our operating groups,
see Part I, Item 1. Business of our Fiscal 2020 Form 10-K. Important factors
relating to certain risks which could impact our business are described in
Part II, Item 1A. Risk Factors of this report and Part I. Item 1A. Risk Factors
of our Fiscal 2020 Form 10-K.

Industry overview

We operate in a highly competitive apparel market that continues to evolve
rapidly with the expanding application of technology to fashion retail. No
single apparel firm or small group of apparel firms dominates the apparel
industry, and our direct competitors vary by operating group and distribution
channel. The apparel industry is cyclical and very dependent upon the overall
level and focus of discretionary consumer spending, which changes as consumer
preferences and regional, domestic and international economic conditions change.
Further, negative economic conditions often have a longer and more severe impact
on the apparel industry than on other industries.

The competitive and evolving environment requires that brands and retailers
approach their operations, including marketing and advertising, very differently
than historical practices and may result in increased operating costs and
capital investments to generate growth or even maintain current sales levels.
Many of these changes in the industry were accelerated or exacerbated by the
COVID-19 pandemic. While this competition and evolution present significant
risks,

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especially for traditional retailers who fail or are unable to adapt, we believe
it also presents a tremendous opportunity for brands and retailers to capitalize
on the changing consumer environment.

We believe our lifestyle brands have true competitive advantages in this
retailing paradigm, and we continue to invest in and leverage 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.

Covid-19 pandemic

The COVID-19 pandemic has had a significant effect on overall economic
conditions and our operations and was the primary reason for a 33% reduction in
net sales and a significant net loss in Fiscal 2020 after years of profitable
operating results. While our mission remains the enhancement of long-term
shareholder value, our focus during this crisis has been (1) the health and
well-being of our employees, customers and communities, (2) protecting the
reputation, value and image of our brands and (3) preserving liquidity. Actions
taken in Fiscal 2020 to mitigate the impact of the COVID-19 pandemic on our
business, operations and liquidity are discussed in our Fiscal 2020 Form 10-K.

Due to the COVID-19 pandemic, we saw reduced consumer traffic starting in March
2020 and temporarily closed all our retail and restaurant locations. We began
reopening our stores and restaurants in the Second Quarter of Fiscal 2020 in a
phased approach in accordance with local government guidelines and with
additional safety protocols. Some of our locations continue to experience
reduced traffic, limited operating hours and capacity, seating and other
limitations, with such factors impacting individual locations to varying
degrees. There can be no assurance that additional closures will not occur in
the future as a result of any resurgence of COVID-19 cases and/or additional
government mandates or recommendations. In addition, the shift from in-store
shopping to online shopping accelerated during the COVID-19 pandemic resulting
in strong growth in our e-commerce businesses during the COVID-19 pandemic.

While the First Nine Months of Fiscal 2021 saw a significant rebound in retail
traffic in the strong consumer macro-economic environment, there can be no
assurance that these short-term trends will continue. There remains significant
uncertainty as to the duration and severity of the pandemic as well as the
associated business disruption, impact on discretionary spending and
restrictions on our ongoing operations. Thus, the ultimate impact of the
pandemic on our business is uncertain, at this time.

Lanier clothing outlet

In the Third Quarter of Fiscal 2020, we decided to exit our Lanier Apparel
business, a business which had been focused on moderately priced tailored
clothing and related products. This decision aligns with our stated business
strategy of developing and marketing compelling lifestyle brands. It also took
into consideration the increased macroeconomic challenges faced by the Lanier
Apparel business, many of which were magnified by the COVID-19 pandemic. The
exit of the Lanier Apparel business was effectively complete as of October 30,
2021.

In connection with the exit of the Lanier Apparel business, we recorded pre-tax
charges of $13 million in the Lanier Apparel operating group during the Second
Half of Fiscal 2020, with an additional $1 million of net charges in the First
Nine Months of Fiscal 2021. The Lanier Apparel exit charges are discussed in
Note 7 in the unaudited condensed consolidated financial statements included in
this report. We do not expect to incur any additional Lanier Apparel exit
charges subsequent to October 30, 2021.

Key Operating Results:

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The following table sets forth our consolidated operating results (in thousands,
except per share amounts) for the First Nine Months of Fiscal 2021 compared to
the First Nine Months of Fiscal 2020:


                                                        First Nine Months
                                                   Fiscal 2021     Fiscal 2020
Net sales                                         $     842,163    $    527,466
Operating income (loss)                           $     133,496    $  (107,224)
Net earnings (loss)                               $     105,913    $   (83,475)
Net earnings (loss) per diluted share             $        6.29    $     

(5.04)

Weighted average shares outstanding -- diluted           16,841          16,576




The improved earnings per share in the First Nine Months of Fiscal 2021 were
primarily a result of (1) improved operating results in each of our operating
groups as our operations continued to recover from the unfavorable impact the
COVID-19 pandemic had on Fiscal 2020, (2) the absence of impairment charges
related to goodwill and intangible assets in the First Nine Months of Fiscal
2021 after recognizing $60 million of impairment charges related to goodwill and
intangible assets in the First Nine Months of Fiscal 2020, and (3) the lower
exit charges in Lanier Apparel. These favorable items were partially offset by a
larger operating loss in Corporate and Other, which in the First Nine Months of
Fiscal 2021 included the net unfavorable impact of LIFO accounting of $19
million and a gain on sale of an unconsolidated entity of $12 million.

Compared to the earnings per share in the First Nine Months of Fiscal 2019 of
$3.15, earnings per share increased significantly to $6.29 in the First Nine
Months of Fiscal 2021. The higher earnings per share compared to the First Nine
Months of Fiscal 2019 were primarily a result of (1) increased operating income
in each of our Tommy Bahama, Lilly Pulitzer and Southern Tide operating groups,
(2) a lower operating loss in Corporate and Other, and (3) a lower effective tax
rate. These items were partially offset by lower operating income in Lanier
Apparel. The higher operating income in Tommy Bahama, Lilly Pulitzer and
Southern Tide were primarily due to higher net sales and gross margin partially
offset by higher SG&A.

                                  STORE COUNT

The table below provides store count information for our brands as of the dates
specified. The store count includes our permanent locations and excludes any
pop-up or temporary store locations which have an initial lease term of 12
months or less. While all of our stores and restaurants were temporarily closed
beginning in March 2020 due to the COVID-19 pandemic, as of October 30, 2021,
substantially all of our locations have re-opened, albeit with some continuing
to experience reduced traffic, limited operating hours and capacity, seating and
other limitations, with such factors impacting individual locations to varying
degrees.




                                                    October 30,    January 30,    October 31,    February 1,
                                                       2021           2021           2020           2020
Tommy Bahama retail stores                                  103            105            106            111
Tommy Bahama retail-restaurant locations                     21             20             19             16
Tommy Bahama outlets                                         35             35             35             35
Total Tommy Bahama locations                                159            160            160            162
Lilly Pulitzer retail stores                                 59             59             59             61
Southern Tide retail stores                                   4            
 3              3              1
Total Oxford locations                                      222            222            222            224






                             RESULTS OF OPERATIONS

     THIRD QUARTER OF FISCAL 2021 COMPARED TO THIRD QUARTER OF FISCAL 2020

The discussion and tables below compare our statements of operations for the
Third Quarter of Fiscal 2021 to the Third Quarter of Fiscal 2020. 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

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due to rounding. The individual items in our consolidated statements of income, including gross margin, may not be directly comparable to those of our competitors, as the classification of certain expenses may vary from company to 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:




                                             Third Quarter
                                  Fiscal 2021             Fiscal 2020           $ Change     % Change

Net sales                      $ 247,729    100.0 %    $  175,135   100.0 %     $  72,594        41.5 %
Cost of goods sold                95,191     38.4 %        78,866    45.0 %        16,325        20.7 %
Gross profit                   $ 152,538     61.6 %    $   96,269    55.0 %     $  56,269        58.4 %
SG&A                             137,505     55.5 %       113,537    64.8 %        23,968        21.1 %
Royalties and other
operating income                  15,574      6.3 %         3,550     2.0 %        12,024       338.7 %
Operating income (loss)        $  30,607     12.4 %    $ (13,718)   (7.8) %     $  44,325          NM %
Interest expense, net                222      0.1 %           339     0.2 %         (117)      (34.5) %
Earnings (loss) before
income taxes                   $  30,385     12.3 %    $ (14,057)   (8.0) %     $  44,442          NM %
Income tax provision
(benefit)                          4,400      1.8 %       (3,453)   (2.0) %         7,853          NM %
Net earnings (loss)            $  25,985     10.5 %    $ (10,604)   (6.1) %     $  36,589          NM %




Net Sales




                                  Third Quarter
                           Fiscal 2021     Fiscal 2020     $ Change     % Change
Tommy Bahama              $     148,454   $      94,905    $  53,549        56.4 %
Lilly Pulitzer                   72,157          53,714       18,443        34.3 %
Southern Tide                    13,151          10,023        3,128        31.2 %
Lanier Apparel                    4,232          10,810      (6,578)      (60.9) %
Corporate and Other               9,735           5,683        4,052        71.3 %
Consolidated net sales    $     247,729   $     175,135    $  72,594        41.5 %



Consolidated net sales increased $73 million, or 42%, in the Third Quarter of
Fiscal 2021, including increases in each channel of distribution and ongoing
operating group. Our operations continued to recover from the impact of the
COVID-19 pandemic, which resulted in temporary store closures and reduced
traffic in Fiscal 2020, and consumers have become increasingly more comfortable
returning to physical shopping in Fiscal 2021. The increase in net sales
included increases in (1) full-price retail sales of $41 million, or 106%, (2)
full-price e-commerce sales of $15 million, or 32%, (3) wholesale sales of our
non-Lanier Apparel businesses of $10 million, or 26%, (4) restaurant sales of $8
million, or 62%, (5) outlet sales of $4 million, or 49%, and (6) e-commerce
flash clearance sales of $1 million, or 4%. These increases were partially
offset by a decrease in Lanier Apparel sales of $7 million. The changes in net
sales by operating group are discussed below.

Compared to the $241 million of net sales in the Third Quarter of Fiscal 2019,
consolidated net sales increased $7 million, or 3%, in the Third Quarter of
Fiscal 2021. The higher sales compared to the Third Quarter of Fiscal 2019
include increases in Tommy Bahama, Lilly Pulitzer, Southern Tide and Corporate
and Other partially offset by lower sales in Lanier Apparel of $25 million. The
increase in net sales included increases in (1) e-commerce sales of $32 million,
or 100%, with increases in each of our brands, (2) full-price retail sales of $9
million, or 13%, driven by an increase in Tommy Bahama and Southern Tide
partially offset by a decrease in Lilly Pulitzer, and (3) restaurant sales of $2
million, or 14%, resulting from sales at additional Tommy Bahama Marlin Bars and
increased sales in existing Tommy Bahama food and beverage locations. These
increases were partially offset by decreases in (1) Lanier Apparel sales of $25
million, and (2) e-commerce flash clearance sales of $12 million, or 38%.
Wholesale sales of our non-Lanier Apparel businesses and our outlet stores each
decreased by less than $1 million from the Third Quarter of Fiscal 2019.

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The following table shows the share of our consolidated sales by distribution channel for each period presented:



                    Third Quarter
              Fiscal 2021    Fiscal 2020
Retail                 37 %           27 %
E-commerce             33 %           38 %
Restaurant              8 %            7 %
Wholesale              21 %           28 %
Total                 100 %          100 %




Tommy Bahama:

Tommy Bahama net sales increased $54 million, or 56%, in the Third Quarter of
Fiscal 2021. The increase in net sales in Tommy Bahama included increases in (1)
full-price retail sales of $30 million, or 115%, (2) restaurant sales of $8
million, or 62%, including higher sales at our additional Tommy Bahama Marlin
Bar locations as well as existing locations, (3) e-commerce sales of $7 million,
or 29%, (4) outlet sales of $4 million, or 49%, and (5) wholesale sales of $4
million, or 18%. The following table presents the proportion of net sales by
distribution channel for Tommy Bahama for each period presented:




                    Third Quarter
              Fiscal 2021    Fiscal 2020
Retail                 47 %           37 %
E-commerce             22 %           27 %
Restaurant             13 %           13 %
Wholesale              18 %           23 %
Total                 100 %          100 %




Lilly Pulitzer:

Lilly Pulitzer net sales increased $18 million, or 34%, in the Third Quarter of
Fiscal 2021. The increase in net sales in Lilly Pulitzer included increases in
(1) retail sales of $10 million, or 84%, (2) full-price e-commerce sales of $6
million, or 35%, (3) wholesale sales of $2 million, or 24%, and (4) e-commerce
flash clearance sales of $1 million, or 4%. The following table presents the
proportion of net sales by distribution channel for Lilly Pulitzer for each
period presented:




                    Third Quarter
              Fiscal 2021    Fiscal 2020
Retail                 31 %           22 %
E-commerce             58 %           66 %
Wholesale              11 %           12 %
Total                 100 %          100 %




Southern Tide:

Southern Tide net sales increased $3 million, or 31%, in the Third Quarter of
Fiscal 2021, with increases in each channel of distribution. The increase in net
sales in Southern Tide included increases in (1) wholesale sales of $2 million,
or 31%, (2) retail sales of $1 million resulting from additional Southern Tide
retail stores and (3) e-commerce sales of

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15%. The following table presents the proportion of net sales by distribution channel for Southern Tide for each period presented:



                    Third Quarter
              Fiscal 2021    Fiscal 2020
Retail                  7 %            4 %
E-commerce             21 %           24 %
Wholesale              72 %           72 %
Total                 100 %          100 %




Lanier Apparel:

Lanier Apparel’s net sales decreased by $ 7 million in the third quarter of fiscal 2021. We sold our remaining inventory of Lanier clothing and exited the Lanier clothing business in the third quarter of fiscal 2021.

Companies and others:

Increase in corporate net sales and others $ 4 million, or 71%, in the third quarter of fiscal 2021, including increased sales of each of our brands included in Corporate and Others.



Gross Profit

The tables below present gross profit by operating group and in total for the
Third Quarter of Fiscal 2021 and the Third Quarter of Fiscal 2020, as well as
the change between those two periods and gross margin by operating group and in
total. Gross margin is calculated as gross profit divided by net sales.




                                                Third Quarter
                                         Fiscal 2021      Fiscal 2020     $ Change     % Change
Tommy Bahama                            $      91,773    $      56,444    $  35,329        62.6 %
Lilly Pulitzer                                 48,668           32,830       15,838        48.2 %
Southern Tide                                   7,031            3,420        3,611       105.6 %
Lanier Apparel                                  2,195          (4,978)        7,173          NM %
Corporate and Other                             2,871            8,553      (5,682)          NM %
Consolidated gross profit               $     152,538    $      96,269    $  56,269        58.4 %
Notable items included in amounts
above:
LIFO adjustments in Corporate and
Other                                   $       2,197    $     (5,645)
Lanier Apparel exit charges in cost
of goods sold                           $       (684)    $       6,415






                                   Third Quarter
                             Fiscal 2021    Fiscal 2020
Tommy Bahama                        61.8 %         59.5 %
Lilly Pulitzer                      67.4 %         61.1 %
Southern Tide                       53.5 %         34.1 %
Lanier Apparel                      51.9 %       (46.0) %
Corporate and Other                   NM %           NM %
Consolidated gross margin           61.6 %         55.0 %




The increase in consolidated gross profit in the Third Quarter of Fiscal 2021
was primarily due to the higher net sales and higher gross margin, with gross
margin improvement in each operating group. The higher consolidated gross margin
was primarily due to (1) more full-price selling and less inventory markdowns,
discounts, allowances and promotions in the Third Quarter of Fiscal 2021, (2) a
change in sales mix as full-price direct to consumer sales represented a larger
proportion of net sales, while wholesale sales in our brands, Lanier Apparel
sales and e-commerce

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flash clearance sales represented a lower proportion of net sales, in the Third
Quarter of Fiscal 2021, and (3) improved initial product margins. These items
that favorably impacted gross margin were partially offset by an $8 million
unfavorable impact of LIFO accounting and increased freight costs, including
rate increases impacting inbound products and e-commerce shipping costs, as well
as increased air freight on inbound products. During the Third Quarter of Fiscal
2021, we reduced inventory markdown reserves by $1 million, due, in part, to the
sale of previously marked down inventory during the quarter and a $1 million
reduction to Lanier Apparel inventory markdown reserves, which was offset by a
$2 million LIFO accounting charge in Corporate and Other. In the Third Quarter
of Fiscal 2020, we recognized $7 million of inventory markdowns, which were
partially offset by a $6 million LIFO accounting credit.

Compared to the 55.1% gross margin in the Third Quarter of Fiscal 2019, the
consolidated gross margin increased 650 basis points to 61.6% in the Third
Quarter of Fiscal 2021. The improved consolidated gross margin in the Third
Quarter of Fiscal 2021 was primarily due to (1) more full-price selling and less
inventory markdowns, discounts, allowances and promotions in the Third Quarter
of Fiscal 2021, (3) a change in sales mix as full-price direct to consumer sales
represented a larger proportion of net sales, while wholesale sales in our
brands, Lanier Apparel sales and e-commerce flash clearance sales represented a
smaller proportion of net sales, in the Third Quarter of Fiscal 2021, and (3)
improved initial product margins. These items that favorably impacted gross
margin were partially offset by an unfavorable impact of LIFO accounting, with
the Third Quarter of Fiscal 2021 including a $2 million LIFO accounting charge
compared to a minimal impact of LIFO accounting in the Third Quarter of Fiscal
2019, and increased freight costs, including rate increases impacting inbound
products and e-commerce shipping costs, as well as increased air freight on
inbound products, in the Third Quarter of Fiscal 2021.

Tommy Bahama:

The improved gross margin for Tommy Bahama was primarily due to (1) more
full-price selling and less inventory markdowns, discounts and promotions, (2) a
change in sales mix as full-price direct to consumer sales represented a larger
proportion of net sales, and wholesale and outlet store sales represented a
lower proportion of net sales, in the Third Quarter of Fiscal 2021, and (3)
improved initial product margin reflecting a combination of increased sales
prices and reductions in product costs. These items that favorably impacted
gross margin were partially offset by increased freight costs.

Lilly pulitzer:

The improved gross margin for Lilly Pulitzer was primarily due to (1) more
full-price selling and less inventory markdowns, discounts and promotions, (2) a
change in sales mix as full-price direct to consumer sales represented a larger
proportion of sales and e-commerce flash clearance sales represented a smaller
proportion of net sales in the Third Quarter of Fiscal 2021, and (3) improved
initial product margin reflecting a combination of increased sales prices and
reductions in product costs. These items that favorably impacted gross margin
were partially offset by increased freight costs.

South tide:

The improved gross margin for Southern Tide was primarily due to more full-price
selling and less inventory markdowns, discounts and promotions. These items that
favorably impacted gross margin were partially offset by increased freight
costs.

Lanier Clothing:

The improved gross margin for Lanier Apparel in the Third Quarter of Fiscal 2021
was primarily due to the Third Quarter of Fiscal 2020 including $6 million of
inventory markdowns while the Third Quarter of Fiscal 2021 included a $1 million
reduction in inventory markdowns as we disposed of the remaining Lanier Apparel
inventory at higher gross margins than previously estimated.

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Corporate and Other:
The gross profit in Corporate and Other primarily reflects the gross profit of
TBBC, Duck Head and the Lyons, Georgia distribution center as well as the impact
of LIFO accounting adjustments. The primary driver for the lower gross profit
was the $8 million net unfavorable impact of LIFO accounting with a $2 million
LIFO accounting charge in the Third Quarter of Fiscal 2021 and a $6 million LIFO
accounting credit in the Third Quarter of Fiscal 2020. The unfavorable impact of
LIFO accounting was partially offset by higher net sales in Corporate and Other.
The LIFO accounting impact in Corporate and Other in each period primarily
reflects (1) a charge in Corporate and Other when inventory that had been marked
down to the estimated net realizable value in an operating group in a prior
period was ultimately sold or (2) a credit in Corporate and Other when inventory
had been marked down to the estimated net realizable value in an operating group
in the current period but had not been sold as of period end.

SG&A




                                                 Third Quarter
                                          Fiscal 2021      Fiscal 2020      $ Change     % Change
SG&A                                     $     137,505    $     113,537    $   23,968        21.1 %
SG&A (as a % of net sales)                        55.5 %           64.8 %
Notable items included in amounts
above:
Tommy Bahama lease termination charge    $       4,850    $           -
Amortization of Lilly Pulitzer
Signature Store intangible assets        $           -    $          68
Amortization of Southern Tide
intangible assets                        $          73    $          72

Lanier Apparel Exit Fee in SG&A $ 559 $ 3,701
TBBC change in fair value of contingent consideration

                 $         786    $           -




The higher SG&A in the Third Quarter of Fiscal 2021 included (1) increased
employment costs of $11 million, with much of that increase primarily due to the
impact of COVID-19 on the prior year, (2) a $5 million lease termination charge
related to a Tommy Bahama office and showroom lease, (3) a $5 million increase
in advertising expense, (3) a $3 million increase in administrative expenses
including professional fees, supplies and travel, (4) a $2 million increase in
credit card transaction fees, and (5) a $1 million charge for change in the fair
value of contingent consideration. These increases were partially offset by the
Third Quarter of Fiscal 2021 including $3 million less of Lanier Apparel exit
charges than the amount included in the prior year.

Compared to the $134 million of SG&A in the Third Quarter of Fiscal 2019, SG&A
increased by $3 million in the Third Quarter of Fiscal 2021. The higher SG&A was
primarily due to (1) a $5 million charge for a lease termination charge related
to a Tommy Bahama office and showroom lease, (2) a $4 million increase in
advertising expense, (3) a $3 million increase in administrative expenses
including professional fees, supplies and travel and (4) a $1 million charge for
change in fair value of contingent consideration. These increases were partially
offset by (1) a $5 million decrease in employment costs, including the
reductions at Lanier Apparel, (2) a $2 million reduction in occupancy expenses,
including the impact of fewer direct to consumer leases in the Third Quarter of
Fiscal 2021, and (3) a $1 million reduction in selling expenses including
royalties.

Royalties and other operating income



                                                                Third Quarter
                                                        Fiscal 2021       Fiscal 2020      $ Change      % Change
Royalties and other operating income                   $       15,574    $       3,550    $    12,024       338.7 %
Notable items included in amounts above:
Gain on sale of investment in unconsolidated entity    $     (11,586)    $ 
         -




Royalties and other operating income in the Third Quarter of Fiscal 2021
included a $12 million gain recognized on the sale of an interest in an
unconsolidated entity. The remaining amounts in royalties and other operating
income in the Third Quarter of Fiscal 2021 and the Third Quarter of Fiscal 2020
primarily consist of income received from third

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parts of the licensing of our brands, with the increase over the previous period mainly due to higher royalty revenues in Tommy Bahama.

Operating income (loss)




                                               Third Quarter
                                        Fiscal 2021      Fiscal 2020     $ Change     % Change
Tommy Bahama                           $       5,531    $     (7,212)    $  12,743          NM %
Lilly Pulitzer                                15,985            5,266       10,719       203.6 %
Southern Tide                                  2,690            (464)        3,154          NM %
Lanier Apparel                                   348         (12,500)       12,848          NM %
Corporate and Other                            6,053            1,192        4,861          NM %
Consolidated Operating Income
(Loss)                                 $      30,607    $    (13,718)    $  44,325          NM %
Notable items included in amounts
above:
LIFO adjustments in Corporate and
Other                                  $       2,197    $     (5,645)
Lanier Apparel exit charges in cost
of goods sold                          $       (684)    $       6,415
Tommy Bahama lease termination
charge                                 $       4,850    $           -
Amortization of Lilly Pulitzer
Signature Store intangible assets      $           -    $          68
Amortization of Southern Tide
intangible assets                      $          73    $          72

Lanier Apparel Exit Fee in SG&A $ 559 $ 3,701
Gain on the sale of an investment in an unconsolidated entity

                  $    (11,586)    $           -
TBBC change in fair value of
contingent consideration               $         786    $           -




The improved operating results in the Third Quarter of Fiscal 2021 were
primarily due to (1) the improved operating results in each of our Tommy Bahama,
Lilly Pulitzer and Southern Tide operating groups, (2) the Third Quarter of
Fiscal 2021 including $10 million less of Lanier Apparel exit charges, and (3)
improved operating results in Corporate and Other, including the net impact of a
gain on the sale of an interest in an unconsolidated entity and LIFO accounting.
The improved operating results in Tommy Bahama were unfavorably impacted by a $5
million lease termination charge. Changes in operating income (loss) by
operating group are discussed below.

Compared to the $3 million of operating income in the Third Quarter of Fiscal
2019, operating income in the Third Quarter of Fiscal 2021 increased by $28
million to $31 million. This increase was primarily due to higher gross margin,
the gain on sale of our investment in an unconsolidated entity, higher sales and
a lower effective tax rate. Compared to the Third Quarter of Fiscal 2019,
operating results improved in Tommy Bahama, Lilly Pulitzer, Southern Tide and
Corporate and Other, which were partially offset by lower operating income
in
Lanier Apparel.

Tommy Bahama:




                                            Third Quarter
                                     Fiscal 2021      Fiscal 2020      $ Change     % Change
Net sales                           $     148,454    $      94,905    $   53,549        56.4 %
Gross profit                        $      91,773    $      56,444    $   35,329        62.6 %
Gross margin                                 61.8 %           59.5 %
Operating income (loss)             $       5,531    $     (7,212)    $   12,743          NM %
Operating income (loss) as % of
net sales                                     3.7 %          (7.6) %
Notable items included in
amounts above:
Tommy Bahama lease termination
charge                              $       4,850    $           -




The improved operating results for Tommy Bahama in the Third Quarter of Fiscal
2021 were due to higher sales, and improved gross margin partially offset by
increased SG&A. The increased SG&A was primarily due to (1) $10 million of
increased employment costs, with much of that increase primarily due to the
impact of COVID-19 on the prior year, (2) $5 million of increased occupancy cost
primarily due to the Tommy Bahama office and showroom lease

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termination charge, (3) $3 million of increased advertising expense, and (4) $3
million of increased variable expenses related to higher sales, including credit
card transaction fees, supplies and other expenses.

Lilly Pulitzer:




                                              Third Quarter
                                       Fiscal 2021      Fiscal 2020      $ Change     % Change
Net sales                             $      72,157    $      53,714    $   18,443        34.3 %
Gross profit                          $      48,668    $      32,830    $   15,838        48.2 %
Gross margin                                   67.4 %           61.1 %
Operating income                      $      15,985    $       5,266    $   10,719       203.6 %
Operating income as % of net sales             22.2 %            9.8 %
Notable items included in amounts
above:
Amortization of Lilly Pulitzer
Signature Store intangible assets     $           -    $          68





The increased operating income for Lilly Pulitzer in the Third Quarter of Fiscal
2021 was primarily due to higher sales and improved gross margin partially
offset by increased SG&A. The increased SG&A was primarily due to (1) $1 million
of increased employment costs, with much of that increase primarily due to the
impact of COVID-19 on the prior year, (2) $1 million of higher advertising
expense, (3) $1 million of credit card transaction fees and supplies and (4)
increases in other expense items.

Southern Tide:




                                            Third Quarter
                                     Fiscal 2021      Fiscal 2020      $ Change     % Change
Net sales                           $      13,151    $      10,023    $    3,128        31.2 %
Gross profit                        $       7,031    $       3,420    $    3,611       105.6 %
Gross margin                                 53.5 %           34.1 %
Operating income (loss)             $       2,690    $       (464)    $    3,154          NM %
Operating income (loss) as % of
net sales                                    20.5 %          (4.6) %
Notable items included in
amounts above:
Amortization of Southern Tide
intangible assets                   $          73    $          72




The improved operating results for Southern Tide in the Third Quarter of Fiscal
2021 were primarily due to higher gross margin and higher sales, partially
offset by higher SG&A. The higher SG&A includes higher SG&A associated with the
Southern Tide retail store operations, advertising and variable expenses.

Lanier Apparel:




                                            Third Quarter
                                     Fiscal 2021      Fiscal 2020     $ Change     % Change
Net sales                           $       4,232    $      10,810    $ (6,578)      (60.9) %
Gross profit                        $       2,195    $     (4,978)    $   7,173          NM %
Gross margin                                 51.9 %         (46.0) %
Operating income (loss)             $         348    $    (12,500)    $  12,848          NM %
Operating income (loss) as % of
net sales                                     8.2 %        (115.6) %
Notable items included in
amounts above:
Lanier Apparel exit charges in
cost of goods sold                  $       (684)    $       6,415
Lanier Apparel exit charges in
SG&A                                $         559    $       3,701





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We sold our remaining Lanier Apparel inventory and exited the Lanier Apparel
business in the Third Quarter of Fiscal 2021. The improved operating results for
Lanier Apparel in the Third Quarter of Fiscal 2021 were primarily due to the
Third Quarter of Fiscal 2020 including $10 million of initial charges associated
with the decision to exit the Lanier Apparel business and the Third Quarter of
Fiscal 2021 having lower SG&A after reducing the Lanier Apparel infrastructure
over the past year. The Lanier Apparel exit charges are discussed in Note 7 in
the unaudited condensed consolidated financial statements included in this
report. We do not anticipate any significant cash requirements of Lanier Apparel
in future periods.

Corporate and Other:




                                            Third Quarter
                                     Fiscal 2021      Fiscal 2020     $ Change     % Change
Net sales                           $       9,735    $       5,683    $   4,052        71.3 %
Gross profit                        $       2,871    $       8,553    $ (5,682)          NM %
Operating income                    $       6,053    $       1,192    $   4,861          NM %
Notable items included in
amounts above:
LIFO adjustments in Corporate
and Other                           $       2,197    $     (5,645)
Gain on sale of investment in
unconsolidated entity               $    (11,586)    $           -
TBBC change in fair value of
contingent consideration            $         786    $           -




The improved operating results for Corporate and Other were primarily due to (1)
the Third Quarter of Fiscal 2021 including a $12 million gain on sale of our
investment in an unconsolidated entity and (2) higher sales. These items were
partially offset by (1) the $8 million unfavorable impact of LIFO accounting
resulting from a $2 million charge in the Third Quarter of Fiscal 2021 and a $6
million credit in the Third Quarter of Fiscal 2020 and (2) a $1 million charge
for the change in fair value of contingent consideration included in SG&A.
Interest expense, net




                                  Third Quarter
                          Fiscal 2021       Fiscal 2020      $ Change     % Change
Interest expense, net    $         222     $         339    $    (117)      (34.5) %




The decreased interest expense in the Third Quarter of Fiscal 2021 was primarily
due to the lack of debt outstanding in the Third Quarter of Fiscal 2021, while
in the Third Quarter of Fiscal 2020, we had debt outstanding in order to
maintain a certain level of cash on our balance sheet during the earlier stages
of the COVID-19 pandemic. The interest expense in the Third Quarter of Fiscal
2021 primarily consists of unused line fees and amortization of deferred
financing fees associated with our $325 million Fourth Amended and Restated
Credit Agreement (as amended, the "U.S. Revolving Credit Agreement").

Income tax provision (benefit)



                                             Third Quarter
                                      Fiscal 2021      Fiscal 2020      $ Change     % Change
Income tax provision (benefit)       $       4,400    $     (3,453)    $   
7,853          NM %
Effective tax rate                            14.5 %           24.6 %




The income tax expense in the Third Quarter of Fiscal 2021 included the
utilization of benefits associated with certain capital losses to substantially
offset a gain recognized on the sale of an unconsolidated entity in the Third
Quarter of Fiscal 2021. The income tax benefit in the Third Quarter of Fiscal
2020 included the benefit of the operating losses that were realized at a rate
of 35% pursuant to the CARES Act provision allowing the carryback of the Fiscal
2020 loss amounts to pre-U.S. Tax Reform years, offset by the impact of changes
in estimated book to tax timing differences and certain discrete non-deductible
items.

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  Table of Contents

Net earnings




                                                          Third Quarter
                                                   Fiscal 2021      Fiscal 2020
Net sales                                         $     247,729    $     175,135
Operating income (loss)                           $      30,607    $    (13,718)
Net earnings (loss)                               $      25,985    $    (10,604)
Net earnings (loss) per diluted share             $        1.54    $      

(0.64)

Weighted average shares outstanding -- diluted           16,872           16,568




The improved earnings per share in the Third Quarter of Fiscal 2021 were
primarily a result of (1) improved operating results in each of our Tommy
Bahama, Lilly Pulitzer and Southern Tide operating groups as our operations
continued to recover from the unfavorable impact the COVID-19 pandemic had on
Fiscal 2020, (2) the $12 million gain on the sale of an investment in an
unconsolidated entity in the Third Quarter of Fiscal 2021, which was included in
Corporate and Other, (3) the improved results in Lanier Apparel due to lower
exit charges recognized in the Third Quarter of Fiscal 2021 and (4) a lower
effective tax rate. These favorable items were partially offset by the
unfavorable impact of LIFO accounting in Corporate and Other.

Compared to the earnings per share in the Third Quarter of Fiscal 2019 of $0.10,
earnings per share increased significantly to $1.54. The higher earnings per
share compared to the Third Quarter of Fiscal 2019 were primarily a result of
(1) improved operating results in each of our Tommy Bahama, Lilly Pulitzer and
Southern Tide operating groups, including higher gross margin, sales and SG&A,
(2) the improved operating results in Corporate and Other, primarily due to the
gain on the sale of an investment in an unconsolidated entity partially offset
by the impact of LIFO accounting, and (3) a lower effective tax rate. These
items were partially offset by lower operating results in Lanier Apparel, which
we exited in Fiscal 2021. The higher operating income in Tommy Bahama, Lilly
Pulitzer and Southern Tide were primarily due to higher net sales and gross
margin partially offset by higher SG&A.

FIRST NINE MONTHS OF FISCAL 2021 COMPARED TO THE FIRST NINE MONTHS OF FISCAL 2020

The discussion and tables below compare our statements of operations for the
First Nine Months of Fiscal 2021 to the First Nine Months of Fiscal 2020, except
as otherwise noted. 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.

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Contents

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:




                                            First Nine Months
                                  Fiscal 2021              Fiscal 2020             $ Change     % Change
Net sales                      $ 842,163   100.0 %    $   527,466     100.0 %     $  314,697        59.7 %
Cost of goods sold               313,414    37.2 %        232,386      44.1
%         81,028        34.9 %
Gross profit                   $ 528,749    62.8 %    $   295,080      55.9 %     $  233,669        79.2 %
SG&A                             420,997    50.0 %        352,201      66.8 %         68,796        19.5 %
Impairment of goodwill and
intangible assets                      -       - %         60,452      11.5 %       (60,452)     (100.0) %
Royalties and other
operating income                  25,744     3.1 %         10,349       2.0 %         15,395       148.8 %
Operating income (loss)        $ 133,496    15.9 %    $ (107,224)    (20.3) %     $  240,720          NM %
Interest expense, net                685     0.1 %          1,673       0.3 %          (988)      (59.1) %
Earnings (loss) before
income taxes                   $ 132,811    15.8 %    $ (108,897)    (20.6) %     $  241,708          NM %
Income tax provision
(benefit)                         26,898     3.2 %       (25,422)     (4.8) %         52,320          NM %
Net earnings (loss)            $ 105,913    12.6 %    $  (83,475)    (15.8) %     $  189,388          NM %




Net Sales




                                First Nine Months
                           Fiscal 2021     Fiscal 2020     $ Change    % Change
Tommy Bahama              $     513,985   $     277,143    $ 236,842       85.5 %
Lilly Pulitzer                  233,066         176,723       56,343       31.9 %
Southern Tide                    43,204          27,136       16,068       59.2 %
Lanier Apparel                   24,743          29,985      (5,242)     (17.5) %
Corporate and Other              27,165          16,479       10,686       64.8 %
Consolidated net sales    $     842,163   $     527,466    $ 314,697       59.7 %




Consolidated net sales increased $315 million, or 60%, in the First Nine Months
of Fiscal 2021, including increases in each ongoing operating group. Our
operations continued to recover from the impact of the COVID-19 pandemic which
resulted in temporary store closures and reduced traffic in Fiscal 2020, and
consumers become increasingly more comfortable returning to physical shopping.
The increase in net sales included increases in (1) full-price retail sales of
$165 million, or 146%, (2) sales of our non-Lanier Apparel wholesale businesses
of $61 million, or 60%, (3) full-price e-commerce sales of $49 million, or 25%,
(4) restaurant sales of $38 million, or 118%, and (5) outlet sales of $20
million, or 90%. These increases were partially offset by (1) a decrease in
e-commerce flash clearance sales of $14 million, or 42%, as the strong
full-price selling in Spring and Summer resulted in less inventory available for
the e-commerce flash clearance sale, and (2) a decrease in Lanier Apparel sales
of $5 million. The changes in net sales by operating group are discussed below.

Compared to the net sales of $825 million in the First Nine Months of Fiscal
2019, net sales increased by $17 million, or 2%, in the First Nine Months of
Fiscal 2021 even with a $51 million decrease in Lanier Apparel, which we exited
in Fiscal 2021. The higher net sales compared to the First Nine Months of Fiscal
2019 include increases in Tommy Bahama, Lilly Pulitzer, Southern Tide and
Corporate and Other partially offset by the lower sales in Lanier Apparel. The
higher net sales included increases in (1) full-price e-commerce sales of $92
million, or 62%, with increases in each of our brands, and (2) restaurant sales
of $9 million, or 15%, resulting from the sales at additional Tommy Bahama
Marlin Bars and increased sales in existing Tommy Bahama food and beverage
locations. These increases were partially offset by decreases in (1) Lanier
Apparel sales of $51 million, (2) sales of our non-Lanier Apparel wholesale
businesses of $17 million, or 10%, with reductions in Tommy Bahama and Lilly
Pulitzer, partially offset by increases in our smaller brands, (3) e-commerce
flash clearance sales of $12 million, or 38%, (4) full-price retail sales of $4
million, or 1%, with a reduction in Lilly Pulitzer partially offset by increases
in Tommy Bahama and Southern Tide, and (5) outlet sales of $1 million, or 3%.

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  Table of Contents

The following table shows the share of our consolidated sales by distribution channel for each period presented:



                  First Nine Months
              Fiscal 2021    Fiscal 2020
Retail                 38 %           26 %
E-commerce             31 %           43 %
Restaurant              8 %            6 %
Wholesale              22 %           25 %
Total                 100 %          100 %




Tommy Bahama:

Tommy Bahama net sales increased $237 million, or 86%, in the First Nine Months
of Fiscal 2021, with an increase in each channel of distribution. The increase
in net sales in Tommy Bahama included increases in (1) full-price retail sales
of $116 million, or 148%, (2) restaurant sales of $38 million, or 118%,
including higher sales at our additional Tommy Bahama Marlin Bar locations as
well as existing locations, (3) wholesale sales of $35 million, or 71%, (4)
e-commerce sales of $28 million, or 29%, and (5) outlet sales of $20 million, or
91%. The following table presents the proportion of net sales by distribution
channel for Tommy Bahama for each period presented:




                  First Nine Months
              Fiscal 2021    Fiscal 2020
Retail                 46 %           36 %
E-commerce             24 %           34 %
Restaurant             14 %           12 %
Wholesale              16 %           18 %
Total                 100 %          100 %




Lilly Pulitzer:

Lilly Pulitzer net sales increased $56 million, or 32%, in the First Nine Months
of Fiscal 2021. The increase in net sales in Lilly Pulitzer included increases
in (1) retail sales of $47 million, or 139%, (2) full-price e-commerce sales of
$15 million, or 19%, and (3) wholesale sales of $8 million, or 27%. These
increases were partially offset by a $14 million, or 42%, decrease in e-commerce
flash clearance sales as Lilly Pulitzer did not have as much end of season
inventory for e-commerce flash clearance sales in Fiscal 2021 due to higher
full-price sales than planned. The following table presents the proportion of
net sales by distribution channel for Lilly Pulitzer for each period presented:




                  First Nine Months
              Fiscal 2021    Fiscal 2020
Retail                 35 %           19 %
E-commerce             48 %           64 %
Wholesale              17 %           17 %
Total                 100 %          100 %




Southern Tide:

Southern Tide net sales increased $16 million, or 59%, in the First Nine Months
of Fiscal 2021. The increase in net sales in Southern Tide included increases in
(1) wholesale sales of $12 million, or 65%, (2) e-commerce sales of $2

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million, or 27%, and (3) retail sales of $ 2 million, primarily due to sales at other Southern Tide retail stores. The following table presents the proportion of net sales by distribution channel for Southern Tide for each period presented:



                  First Nine Months
              Fiscal 2021    Fiscal 2020
Retail                  7 %            3 %
E-commerce             23 %           29 %
Wholesale              70 %           68 %
Total                 100 %          100 %




Lanier Apparel:

Lanier Apparel net sales declined $ 5 million during the first nine months of fiscal 2021. We sold our remaining inventory of Lanier apparel and exited the Lanier apparel business during the third quarter of fiscal 2021.

Companies and others:

Corporate and Other net sales increased $11 million, or 65%, in the First Nine
Months of Fiscal 2021 including increased sales in each of our smaller brands
included in Corporate and Other.



Gross profit

The tables below present gross profit by operating group and in total for the
First Nine Months of Fiscal 2021 and the First Nine Months of Fiscal 2020, as
well as the change between those two periods and gross margin by operating group
and in total. Gross margin is calculated as gross profit divided by net sales.




                                              First Nine Months
                                         Fiscal 2021      Fiscal 2020      $ Change     % Change
Tommy Bahama                            $     326,681    $     161,711    $  164,970       102.0 %
Lilly Pulitzer                                161,718          108,582        53,136        48.9 %
Southern Tide                                  23,489            7,934        15,555       196.1 %
Lanier Apparel                                 12,255            (583)        12,838          NM %
Corporate and Other                             4,606           17,436      (12,830)          NM %
Consolidated gross profit               $     528,749    $     295,080    $  233,669        79.2 %
Notable items included in amounts
above:
LIFO adjustments in Corporate and
Other                                   $       9,616    $     (9,287)
Lanier Apparel exit charges in cost
of goods sold                           $     (2,826)    $       6,415





                                 First Nine Months
                             Fiscal 2021    Fiscal 2020
Tommy Bahama                        63.6 %         58.3 %
Lilly Pulitzer                      69.4 %         61.4 %
Southern Tide                       54.4 %         29.2 %
Lanier Apparel                      49.5 %        (1.9) %
Corporate and Other                   NM %           NM %
Consolidated gross margin           62.8 %         55.9 %




The increase in consolidated gross profit in the First Nine Months of Fiscal
2021 was primarily due to the higher net sales as well as higher gross margin,
with gross margin improvement in each operating group. The higher consolidated
gross margin was primarily due to (1) more full-price selling and less inventory
markdowns, discounts, allowances and promotions in the First Nine Months of
Fiscal 2021, (2) a change in sales mix as full-price direct to consumer sales
represented a larger proportion of net sales, while wholesale sales in our
brands, Lanier Apparel sales and e-commerce flash clearance sales represented a
lower proportion of net sales, in the First Nine Months of Fiscal 2021, and (3)
improved initial product margins. These items that favorably impacted gross
margin were partially offset by a $19 million unfavorable impact of LIFO
accounting and increased freight costs, including rate increases impacting
inbound

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products and e-commerce shipping costs, as well as increased air freight on
inbound products. During the First Nine Months of Fiscal 2021, we reduced
inventory markdown reserves by $7 million, due, in part, to the sale of
previously marked down inventory and a $4 million reduction in Lanier Apparel
inventory markdown reserves, which was offset by a $10 million LIFO accounting
charge in Corporate and Other. In the First Nine Months of Fiscal 2020, we
recognized the negative impact of $14 million of changes in inventory markdowns
reserves which were partially offset by a $9 million LIFO accounting credit.

Compared to the 58.0% gross margin in the First Nine Months of Fiscal 2019, the
consolidated gross margin in the First Nine Months of Fiscal 2021 increased by
480 basis points to 62.8%. The improved consolidated gross margin in the First
Nine Months of Fiscal 2021 compared to the First Nine Months of Fiscal 2019 was
primarily due to (1) more full-price selling and less inventory markdowns,
discounts, allowances and promotions in the First Nine Months of Fiscal 2021,
(2) a change in sales mix as full-price direct to consumer sales represented a
larger proportion of net sales, while wholesale sales, Lanier Apparel sales and
e-commerce flash clearance sales represented a lower proportion of net sales, in
the First Nine Months of Fiscal 2021, and (3) improved initial product margins.
These items that favorably impacted gross margin were partially offset by an
unfavorable impact of LIFO accounting, with the First Nine Months of Fiscal 2021
including a $10 million LIFO accounting charge compared to a $1 million LIFO
accounting charge in the First Nine Months of Fiscal 2019 and increased freight
costs, including rate increases impacting inbound products and e-commerce
shipping costs, as well as increased air freight on inbound products in the
First Nine Months of Fiscal 2021.

Tommy Bahama:

The improved gross margin for Tommy Bahama was primarily due to (1) more
full-price selling and less inventory markdowns, discounts and promotions, (2) a
change in sales mix as full-price direct to consumer sales represented a larger
proportion of net sales, and wholesale and outlet store sales represented a
lower proportion of net sales, in the First Nine Months of Fiscal 2021, and (3)
improved initial product margin reflecting a combination of increased sales
prices and reductions in product costs. These items that favorably impacted
gross margin were partially offset by increased freight costs.

Lilly pulitzer:

The improved gross margin for Lilly Pulitzer was primarily due to (1) more
full-price selling and less inventory markdowns, discounts and promotions, (2) a
change in sales mix as full-price direct to consumer sales represented a larger
proportion of sales, and e-commerce flash clearance sales and wholesale sales
represented a lower proportion of net sales, and (3) improved initial product
margin reflecting a combination of increased sales prices and reductions in
product costs. These items that favorably impacted gross margin were partially
offset by increased freight costs.

South tide:

The improved gross margin for Southern Tide was primarily due to more full-price
selling and less inventory markdowns, with the higher markdowns in the prior
period more significantly impacting gross margin on much lower net sales in the
prior period. These items that favorably impacted gross margin were partially
offset by increased freight costs.

Lanier Clothing:

The improved gross margin for Lanier Apparel in the First Nine Months of Fiscal
2021 was primarily due to the First Nine Months of Fiscal 2020 including $6
million of inventory markdowns while the First Nine Months of Fiscal 2021
included a $4 million reduction in inventory markdowns as we disposed of the
remaining Lanier Apparel inventory at higher gross margins than previously
estimated.

Companies and others:

The gross profit in Corporate and Other primarily reflects the gross profit of
TBBC, Duck Head and the Lyons, Georgia distribution center as well as the impact
of LIFO accounting adjustments. The primary driver for the lower gross

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profit was the $19 million net unfavorable impact of LIFO accounting with a $10
million LIFO accounting charge in the First Nine Months of Fiscal 2021 and a $9
million LIFO accounting credit in the First Nine Months of Fiscal 2020. The
unfavorable impact of LIFO accounting was partially offset by higher net sales.
The LIFO accounting impact in Corporate and Other in each period primarily
reflects (1) a charge in Corporate and Other when inventory that had been marked
down to the estimated net realizable value in an operating group in a prior
period was ultimately sold or (2) a credit in Corporate and Other when inventory
had been marked down to the estimated net realizable value in an operating group
in the current period but had not been sold as of period end.

SG&A




                                               First Nine Months
                                          Fiscal 2021      Fiscal 2020      $ Change     % Change
SG&A                                     $     420,997    $     352,201    $   68,796        19.5 %
SG&A (as a % of net sales)                        50.0 %           66.8 %
Notable items included in amounts
above:
Tommy Bahama lease termination charge    $       4,850    $           -
Amortization of Lilly Pulitzer
Signature Store intangible assets        $           -    $         204
Amortization of Southern Tide
intangible assets                        $         217    $         216

Lanier Apparel exit charge in selling and administration costs $ 3,788 $ 3,701
TBBC change in fair value of contingent consideration

                 $         786    $           -




The higher SG&A in the First Nine Months of Fiscal 2021 was primarily due to the
impact of the COVID-19 pandemic on our operations in the First Nine Months of
Fiscal 2020. The higher SG&A included (1) increased employment costs of $47
million, including increased incentive compensation totaling $17 million, (2) a
$12 million increase in variable expenses related to higher sales, including
credit card transaction fees, supplies, commissions and other expenses, (3) an
$8 million increase in advertising expense, (4) a $6 million increase in
occupancy expense, primarily resulting from the Tommy Bahama office and showroom
lease termination charge of $5 million, and (5) a $3 million increase in
administrative expenses including professional fees, travel and other items.
These increases were partially offset by (1) a $7 million decrease in estimated
provisions for credit losses and other charges related to bankruptcies and
credit exposure with respect to multiple customers, and (2) a $3 million
decrease in depreciation expense, as the prior year included certain leasehold
improvement and other fixed asset impairment charges.

Compared to the $418 million of SG&A in the First Nine Months of Fiscal 2019,
SG&A increased by $3 million in the First Nine Months of Fiscal 2021. The higher
SG&A included (1) a $13 million increase in incentive compensation, (2) a $6
million increase in advertising expense, (3) a $5 million Tommy Bahama office
and showroom lease termination charge, (4) a $5 million increase in variable
expenses, including credit card transaction fees, supplies, commissions, selling
and shipping charges and other expenses, (5) $4 million of Lanier Apparel exit
charges in SG&A and (6) other increases in administrative and other expenses.
These increases were partially offset by (1) an $18 million decrease in
employment costs, excluding incentive compensation, resulting from employee
headcount reduction and other initiatives implemented in Fiscal 2020 in response
to the COVID-19 pandemic and the Lanier Apparel exit, (2) a $6 million reduction
in occupancy expenses due to fewer stores and reduced occupancy amounts, (3) a
$4 million reduction in travel expense, and (4) a $2 million reduction in
samples expense.

Impairment of goodwill and intangible assets



There were no impairment charges for goodwill or intangible assets in the First
Nine Months of Fiscal 2021. However, in the First Nine Months of Fiscal 2020,
impairment charges for goodwill and intangible assets totaling $60 million were
recognized in Southern Tide. In addition, in the First Nine Months of Fiscal
2020, a small impairment charge was recognized in Lanier Apparel related to a
trademark acquired in a prior year that was not deemed recoverable. Refer to
Note 4 in the notes to the consolidated financial statements in our Fiscal 2020
Form 10-K for additional information about the impairment charges.

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Royalties and other operating income



                                          First Nine Months
                                     Fiscal 2021      Fiscal 2020      $ Change     % Change
Royalties and other operating
income                              $      25,744    $      10,349    $   15,395       148.8 %
Notable items included in
amounts above:
Gain on sale of investment in
unconsolidated entity               $    (11,586)    $           -




Royalties and other operating income in the First Nine Months of Fiscal 2021
included a $12 million gain recognized on the sale of an interest in an
unconsolidated entity. The remaining amounts in royalties and other operating
income in the First Nine Months of Fiscal 2021 and the First Nine Months of
Fiscal 2020 primarily consist of income received from third parties from the
licensing of our brands, with the increase from the prior period primarily due
to higher royalty income in Tommy Bahama.

Operating income (loss)




                                             First Nine Months
                                        Fiscal 2021     Fiscal 2020     $ Change     % Change
Tommy Bahama                           $      73,515    $   (43,286)    $ 116,801          NM %
Lilly Pulitzer                                61,713          25,676       36,037       140.4 %
Southern Tide                                  8,893        (64,809)       73,702          NM %
Lanier Apparel                                 2,053        (21,271)       23,324          NM %
Corporate and Other                         (12,678)         (3,534)      (9,144)          NM %
Consolidated Operating Income
(Loss)                                 $     133,496    $  (107,224)    $ 240,720          NM %
Notable items included in amounts
above:
LIFO adjustments in Corporate and
Other                                  $       9,616    $    (9,287)
Lanier Apparel exit charges in cost
of goods sold                          $     (2,826)    $      6,415
Tommy Bahama lease termination
charge                                 $       4,850    $          -
Amortization of Lilly Pulitzer
Signature Store intangible assets      $           -    $        204
Amortization of Southern Tide
intangible assets                      $         217    $        216
Southern Tide goodwill and
intangible asset impairment charge     $           -    $     60,245
Lanier Apparel intangible asset
impairment charge                      $           -    $        207

Lanier Apparel exit charge in selling and administration costs $ 3,788 $ 3,701
Gain on the sale of an investment in an unconsolidated entity

                  $    (11,586)    $          -
TBBC change in fair value of
contingent consideration               $         786    $          -



The improved operating results in the First Nine Months of Fiscal 2021 were
primarily due to (1) the improved operating results in each of our operating
groups, (2) no impairment charges related to goodwill and intangible assets in
the First Nine Months of Fiscal 2021 after recognizing $60 million of impairment
charges related to goodwill and intangible assets in the First Nine Months of
Fiscal 2020 and (3) a $9 million decrease in Lanier Apparel exit charges the
First Nine Months of Fiscal 2021. These items were partially offset by (1) a
higher operating loss in Corporate and Other and (2) a $5 million lease
termination charge in Tommy Bahama. Changes in operating income (loss) by
operating group are discussed below.

Compared to the $73 million of operating income in the First Nine Months of
Fiscal 2019, operating income in the First Nine Months of Fiscal 2021 increased
by $61 million. The improved operating results include higher gross margin,
higher net sales, the gain on the sale of our investment in an unconsolidated
entity, and a lower effective tax rate. Compared to the First Nine Months of
Fiscal 2019, operating income in Tommy Bahama, Lilly Pulitzer and Southern Tide
each increased, while the operating income of Lanier Apparel decreased and the
operating loss of Corporate and

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Other improved. The higher operating income in Tommy Bahama, Lilly Pulitzer and
Southern Tide were primarily due to higher gross margin and net sales partially
offset by higher SG&A.

Tommy Bahama:




                                          First Nine Months
                                     Fiscal 2021      Fiscal 2020     $ Change     % Change
Net sales                           $     513,985    $     277,143    $ 236,842        85.5 %
Gross profit                        $     326,681    $     161,711    $ 164,970       102.0 %
Gross margin                                 63.6 %           58.3 %
Operating income (loss)             $      73,515    $    (43,286)    $ 116,801          NM %
Operating income (loss) as % of
net sales                                    14.3 %         (15.6) %
Notable items included in
amounts above:
Tommy Bahama lease termination
charge                              $       4,850    $           -



The improved operating results for Tommy Bahama in the First Nine Months of
Fiscal 2021 were due to higher sales, improved gross margin and increased
royalty income partially offset by increased SG&A. The increased SG&A was
primarily due to (1) $32 million of increased employment costs, including $7
million of increased incentive compensation, (2) $9 million of increased
variable expenses related to higher sales, including credit card transaction
fees, supplies, commissions, royalties and other expenses, (3) $7 million of
higher occupancy costs, including the lease termination charge of $5 million,
with the remainder of the increase primarily resulting from increased costs for
utilities, maintenance and related expenses as direct to consumer locations were
open for the full period in Fiscal 2021, and (4) $2 million of increased
advertising expense. These increases were partially offset by a $2 million
decrease in depreciation expense as the prior year included certain leasehold
improvement and other fixed asset impairment charges.

Lilly Pulitzer:




                                            First Nine Months
                                       Fiscal 2021      Fiscal 2020      $ Change     % Change
Net sales                             $     233,066    $     176,723    $   56,343        31.9 %
Gross profit                          $     161,718    $     108,582    $   53,136        48.9 %
Gross margin                                   69.4 %           61.4 %
Operating income                      $      61,713    $      25,676    $   36,037       140.4 %
Operating income as % of net sales             26.5 %           14.5 %
Notable items included in amounts
above:
Amortization of Lilly Pulitzer
Signature Store intangible assets     $           -    $         204




The increased operating income for Lilly Pulitzer in the First Nine Months of
Fiscal 2021 was primarily due to higher sales and improved gross margin
partially offset by increased SG&A. The increased SG&A was primarily due to (1)
$7 million of increased employment costs, including $3 million of increased
incentive compensation, (2) $5 million of higher advertising expense, (3) $3
million of increased variable expenses related to higher sales, including credit
card transaction fees, supplies and other expenses, (4) $1 million of higher
occupancy expense costs and (5) other increases in operating expenses.

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Southern Tide:




                                          First Nine Months
                                     Fiscal 2021      Fiscal 2020      $ Change     % Change
Net sales                           $      43,204    $      27,136    $   16,068        59.2 %
Gross profit                        $      23,489    $       7,934    $   15,555       196.1 %
Gross margin                                 54.4 %           29.2 %
Operating income (loss)             $       8,893    $    (64,809)    $   73,702          NM %
Operating income (loss) as % of
net sales                                    20.6 %        (238.8) %
Notable items included in
amounts above:
Amortization of Southern Tide
intangible assets                   $         217    $         216
Southern Tide goodwill and
intangible asset impairment
charge                              $           -    $      60,245




The improved operating results for Southern Tide in the First Nine Months of
Fiscal 2021 were primarily due to no impairment charges related to goodwill and
intangible assets in the First Nine Months of Fiscal 2021 compared to $60
million of impairment charges in the First Nine Months of Fiscal 2020.
Additionally, the operating results of Southern Tide improved due to higher
sales and higher gross margin, partially offset by higher SG&A. The higher SG&A
includes higher SG&A associated with the Southern Tide retail store operations,
incentive compensation amounts, advertising expense and variable expenses
partially offset by a decrease in provisions for credit losses.

Lanier Apparel:




                                          First Nine Months
                                     Fiscal 2021      Fiscal 2020     $ Change     % Change
Net sales                           $      24,743    $      29,985    $ (5,242)      (17.5) %
Gross profit                        $      12,255    $       (583)    $  12,838          NM %
Gross margin                                 49.5 %          (1.9) %
Operating income (loss)             $       2,053    $    (21,271)    $  23,324          NM %
Operating income (loss) as % of
net sales                                     8.3 %         (70.9) %
Notable items included in
amounts above:
Lanier Apparel exit charges in
cost of goods sold                  $     (2,826)    $       6,415
Lanier Apparel intangible asset
impairment charge                   $           -    $         207
Lanier Apparel exit charges in
SG&A                                $       3,788    $       3,701




We sold our remaining inventory and exited the Lanier Apparel business in the
First Nine Months of Fiscal 2021.The improved operating results for the First
Nine Months of Fiscal 2021 were primarily due to (1) the First Nine Months of
Fiscal 2020 including $10 million of initial charges associated with the
decision to exit the Lanier Apparel business compared to $1 million of Lanier
Apparel exit charges in the First Nine Months of Fiscal 2021, (2) the First Nine
Months of Fiscal 2020 including $3 million of estimated provisions for credit
losses compared to a $1 million reduction of provisions for credit losses in the
First Nine Months of Fiscal 2021 and (3) lower SG&A in Lanier Apparel, excluding
the Lanier Apparel exit charges, during the wind down phase in 2021. The Lanier
Apparel exit charges are discussed in Note 7 in the unaudited condensed
consolidated financial statements included in this report.

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Corporate and Other:




                                          First Nine Months
                                     Fiscal 2021      Fiscal 2020      $ Change     % Change
Net sales                           $      27,165    $      16,479    $   10,686        64.8 %
Gross profit                        $       4,606    $      17,436    $ (12,830)          NM %
Operating loss                      $    (12,678)    $     (3,534)    $  (9,144)          NM %
Notable items included in
amounts above:
LIFO adjustments in Corporate
and Other                           $       9,616    $     (9,287)
Gain on sale of investment in
unconsolidated entity               $    (11,586)    $           -
TBBC change in fair value of
contingent consideration            $         786    $           -




The lower operating results in the First Nine Months of Fiscal 2021 for
Corporate and Other were primarily due to (1) the $19 million unfavorable impact
of LIFO accounting resulting from a $10 million charge in the First Nine Months
of Fiscal 2021 and a $9 million credit in the First Nine Months of Fiscal 2020
and (2) an increase in employment costs of $8 million, including higher
incentive compensation of $5 million. These unfavorable items were partially
offset by (1) a $12 million gain on sale of our investment in an unconsolidated
entity and (2) the gross profit impact of the higher net sales in the First Nine
Months of Fiscal 2021. These items were partially offset by increased net sales
in each of the businesses included in Corporate and Other.

Interest expense, net




                                First Nine Months
                          Fiscal 2021       Fiscal 2020      $ Change     % Change
Interest expense, net    $         685     $       1,673    $    (988)      (59.1) %



The decreased interest expense in the First Nine Months of Fiscal 2021 was
primarily due to the lack of debt outstanding in the First Nine Months of Fiscal
2021, while in the First Nine Months of Fiscal 2020, we had debt outstanding in
order to maintain a certain level of cash on our balance sheet during the
earlier stages of the COVID-19 pandemic. The interest expense in the First Nine
Months of Fiscal 2021 primarily consists of unused line fees and amortization of
deferred financing fees associated with the U.S. Revolving Credit Agreement.

Income tax provision (benefit)



                                        First Nine Months
                                   Fiscal 2021      Fiscal 2020     $ Change     % Change
Income tax provision (benefit)    $      26,898    $    (25,422)    $  52,320          NM %
Effective tax rate                         20.3 %           23.3 %



The income tax expense in the First Nine Months of Fiscal 2021 included the
benefit of a $2 million net reduction in uncertain tax positions resulting from
the settlement of those uncertain tax position amounts during the period and the
utilization of benefits associated with certain capital losses to substantially
offset a gain recognized on the sale of an unconsolidated entity in the Third
Quarter of Fiscal 2021. These favorable items were partially offset by certain
unfavorable permanent items which are not deductible for income tax purposes.
The net impact of these items results in a lower effective tax rate than a more
typical 25% annual effective tax rate.

The income tax benefit in the First Nine Months of Fiscal 2020 included the
benefit of the operating losses that were realized at a rate of 35% pursuant to
the CARES Act provision allowing the carryback of the Fiscal 2020 loss amounts
to pre-U.S. Tax Reform years, offset by (1) the non-deductibility of certain
impairment charges which resulted in an estimated effective tax rate of 17% on
the impairment charges, (2) the estimated book to tax timing differences and
certain discrete non-deductible items, which reduced the amount of expenses
expected to be deductible for income tax return purposes in Fiscal 2020 and (3)
the impact of restricted stock awards vesting at a price lower than the grant
date value.

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Income tax expense is also discussed in Note 5 to the unaudited condensed consolidated financial statements included in this report.

Net earnings




                                                        First Nine Months
                                                   Fiscal 2021     Fiscal 2020
Net sales                                         $     842,163    $    527,466
Operating income (loss)                           $     133,496    $  (107,224)
Net earnings (loss)                               $     105,913    $   (83,475)
Net earnings (loss) per diluted share             $        6.29    $     

(5.04)

Weighted average shares outstanding -- diluted           16,841          16,576




The improved earnings per share in the First Nine Months of Fiscal 2021 were
primarily a result of (1) improved operating results in each of our operating
groups as our operations continued to recover from the unfavorable impact the
COVID-19 pandemic had on Fiscal 2020, (2) the absence of impairment charges
related to goodwill and intangible assets in the First Nine Months of Fiscal
2021 after recognizing $60 million of impairment charges related to goodwill and
intangible assets in the First Nine Months of Fiscal 2020, and (3) the lower
exit charges in Lanier Apparel. These favorable items were partially offset by a
larger operating loss in Corporate and Other, which in the First Nine Months of
Fiscal 2021 included the net impact of LIFO accounting of $19 million and a gain
on sale of an unconsolidated entity of $12 million.

Compared to the earnings per share in the First Nine Months of Fiscal 2019 of
$3.15, earnings per share increased significantly to $6.29 in the First Nine
Months of Fiscal 2021. The higher earnings per share compared to the First Nine
Months of Fiscal 2019 were primarily a result of (1) increased operating income
in each of our Tommy Bahama, Lilly Pulitzer and Southern Tide operating groups,
(2) a lower operating loss in Corporate and Other, and (3) a lower effective tax
rate. These items were partially offset by lower operating income in Lanier
Apparel. The higher operating income in Tommy Bahama, Lilly Pulitzer and
Southern Tide were primarily due to higher net sales and gross margin partially
offset by higher SG&A.





              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 and Southern Tide lifestyle brands and our
other brands. We distribute our products to our customers via direct to consumer
and wholesale channels of distribution. Our primary uses of cash flow include
the purchase of branded apparel products from third party contract manufacturers
outside of the United States, as well as operating expenses, including employee
compensation and benefits, occupancy-related costs, marketing and advertising
costs, distribution costs, other general and administrative expenses and the
periodic payment of interest, if any, and other payments related to our
financing arrangements. Additionally, we may use cash for the funding of capital
expenditures and other investing activities, dividends, share repurchases and
repayment of indebtedness. 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.

We believe our future cash flow from operating activities, as well as our $188
million of cash and short-term investments as October 30, 2021, will provide
sufficient cash flow to satisfy our ongoing cash requirements as well as ample
opportunity to continue to invest in our brands, direct to consumer initiatives
and other strategic initiatives in both the near term and long term.

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Key Liquidity Measures




                                          October 30,      January 30,      October 31,      February 1,
($ in thousands)                             2021             2021             2020             2020
Total current assets                     $     366,953    $     258,316    $     262,463    $     288,826
Total current liabilities                $     207,172    $     196,252   
$     176,389    $     177,779
Working capital                          $     159,781    $      62,064    $      86,074    $     111,047
Working capital ratio                             1.77             1.32             1.49             1.62



Our working capital ratio is calculated by dividing total current assets by
total current liabilities. Current assets as of October 30, 2021, increased from
October 31, 2020 primarily due to increased short-term investments, which
resulted from positive net cash flows, partially offset by lower inventories.
Current liabilities as of October 30, 2021 increased from October 31, 2020 due
to higher accrued compensation, accounts payable and accrued expenses and other
liabilities.

Balance Sheet

The following tables present certain information included in our consolidated balance sheets (in thousands). Below each table are explanations of any significant variation in the balances at the October 30, 2021 compared to
October 31, 2020.

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