Related Documents
– Q3 2008 GAAP diluted EPS was $0.28 and adjusted diluted EPS was $0.30 compared with Q3 2007 GAAP diluted EPS of $0.69
– Company estimates Q4 2008 GAAP diluted EPS in a range of $0.00 to ($0.18)
– Company estimates fiscal 2008 GAAP diluted EPS in a range of $0.92 to $1.10 and adjusted diluted EPS in a range of $1.04 to $1.22
– Conference call at 5:00 pm eastern today
HOUSTON, Nov. 19 /PRNewswire-FirstCall/ -- The Men's Wearhouse (NYSE: MW) today announced its consolidated financial results for the third quarter ended November 1, 2008. Third Quarter Sales Summary - Fiscal 2008 Total U.S. dollars, in Sales Comparable Store millions Change % Sales Change % Current Prior Current Prior Year Year Year Year Total Company $459.7 $512.1 -10.2% MW $315.6(a) $354.1(a) -10.9% -12.1%(b) +0.6%(b) K&G $80.4 $87.7 -8.3% -13.0% -11.3% United States $406.4 $451.7 -10.0% -12.3% - 2.1% Moores $53.3 $60.5 -11.9% -4.9%(c) +0.6%(c) Year-To-Date Sales Summary - Fiscal 2008 Total U.S. dollars, in Sales Comparable Store millions Change % Sales Change % Current Prior Current Prior Year Year Year Year Total Company $1,496.1 $1,577.6 -5.2% MW $1,006.2(a) $1,073.1(a) -6.2% -8.9%(b) +1.5%(b) K&G $277.4 $298.8 -7.2% -12.0% -8.0% United States $1,317.7 $1,399.0 -5.8% -9.6% -0.8% Moores $178.4 $178.6 -0.1% -3.8%(c) +5.1%(c) (a) Includes retail stores and ecommerce as well as the MW Tux stores resulting from the acquisition of After Hours on April 9, 2007. (b) Comparable store sales do not include ecommerce. MW Tux stores are included beginning Q2 of fiscal 2008. (c) Comparable store sales change is based on the Canadian dollar.
Diluted earnings per share were $0.28 for the third quarter ended
November 1, 2008. Adjusted diluted earnings per share were $0.30 after
excluding $1.1 million (net of tax), $0.02 per diluted share outstanding, of
closure costs incurred in connection with the Company’s previously announced
closure of the Canadian based manufacturing facility operated by the Company’s
subsidiary, Golden Brand. This compares to adjusted diluted earnings per
share guidance given October 8, 2008 of $0.24 to $0.28.
THIRD QUARTER REVIEW -- Total Company sales decreased 10.2% for the quarter. -- Clothing product sales, representing 72.75% of fiscal third quarter 2008 total net sales, decreased 12.9% due to decreases in the Company's comparable store sales primarily driven by a reduction in store traffic levels. -- Tuxedo rental sales, representing 20.99% of fiscal third quarter 2008 total net sales, increased 0.4%. -- Gross margin before occupancy costs, as a percentage of total net sales, decreased 80 basis points from 60.84% to 60.04%. Decreases in clothing product margins, as a percentage of related sales, of 154 basis points were offset by a higher margin tuxedo rental business that increased from 18.76% to 20.99% as a percentage of total sales. -- Occupancy costs increased, as a percentage of total net sales, by 205 basis points from 13.89% to 15.94% primarily due to the deleveraging effect of reduced comparable store sales. -- Selling, general, and administrative expenses were $179.0 million. Excluding $1.8 million in costs associated with the closing of Golden Brand, SG&A expenses of $177.1 million were lower compared to the prior year quarter of $181.3 million and as a percentage of total net sales increased 314 basis points from 35.40% to 38.54%. The basis point increase was primarily due to the deleveraging effect of reduced comparable store sales. -- Operating income was $23.8 million. Excluding $1.8 million in costs associated with the closing of Golden Brand, operating income was $25.6 million or 5.57% of total net sales compared to $59.2 million, or 11.55% of total net sales for the same period last year. -- The effective tax rate for the 2008 third quarter was 38.0%.
FOURTH QUARTER 2008 GUIDANCE
The Company expects diluted earnings per share of $0.00 to a loss of $0.18
for the fourth quarter of 2008. This guidance assumes same store sales at MW,
including MW Tux stores, to decrease in the mid single digit to low double
digit range, at K&G to decrease in the high single digit to low double digit
range and at Moores to decrease in the low single digit range.
FISCAL 2008 GUIDANCE
On July 11, 2008, the Canadian based manufacturing facility operated by
the Company’s subsidiary, Golden Brand, was closed. The pre tax cost to close
the facility was $10.0 million or the equivalent of $0.12 per diluted share
outstanding for the fiscal year. The pre tax cost for the first quarter was
$0.9 million or the equivalent of $0.01 per diluted share outstanding. The
pre tax cost for the second quarter was $7.3 million or the equivalent of
$0.09 per diluted share outstanding. The pre tax cost for the third quarter
was $1.8 million or the equivalent of $0.02 per diluted share outstanding.
The Company is updating its adjusted diluted earnings per share outlook
for the year to a range of $1.04 to $1.22 excluding the Golden Brand closure
costs of $0.12 per diluted share outstanding. Including these costs, GAAP
diluted earnings per share are expected to be $0.92 to $1.10.
The guidance includes an estimated effective tax rate of approximately
36.0% for the full year. The fully diluted shares outstanding are estimated
to be 51.9 million.
CONFERENCE CALL AND WEBCAST INFORMATION
At 5:00 p.m. eastern time on Wednesday, November 19, 2008, Company
management will host a conference call and real time web cast to review the
fiscal third quarter and its outlook for fiscal 2008.
To access the conference call, dial 303-262-2211. To access the live
webcast presentation, visit the Investor Relations section of the Company’s
website at http://www.tmw.com. A telephonic replay will be available through
November 26, 2008 by calling 303-590-3000 and entering the access code of
11120945# or a webcast archive will be available free on the website for
approximately 90 days.
STORE INFORMATION November 1, 2008 November 3, 2007 February 2, 2008 Number Sq. Ft. Number Sq. Ft. Number Sq. Ft. of Stores (000's) of Stores (000's) of Stores (000's) Men's Wearhouse 579 3,248.7 560 3,132.3 563 3,152.6 MW Tux (a) 495 670.4 493 654.8 489 652.0 Moores, Clothing for Men 117 727.9 116 717.8 116 719.8 K&G (b) 107 2,473.0 103 2,392.4 105 2,428.8 Total 1,298 7,120.0 1,272 6,897.3 1,273 6,953.2 (a) MW Tux stores resulting from the acquisition of After Hours on April 9, 2007. (b) 92, 83 and 89 stores, respectively, offering women's apparel.
Founded in 1973, Men’s Wearhouse is one of North America’s largest
specialty retailers of men’s apparel with 1,298 stores. The Men’s Wearhouse,
Moores and K&G stores carry a full selection of designer, brand name and
private label suits, sport coats, furnishings and accessories and the MW Tux
(formerly After Hours) stores carry a limited selection. Tuxedo rentals are
available in the Men’s Wearhouse, Moores and MW Tux stores.
This press release contains forward-looking information. The forward-
looking statements are made pursuant to the Safe Harbor provisions of the
Private Securities Litigation Reform Act of 1995. These forward-looking
statements may be significantly impacted by various factors, including
sensitivity to economic conditions and consumer confidence, possibility of
limited ability to expand Men’s Wearhouse stores, possibility that certain of
our expansion strategies may present greater risks and other factors described
in the Company’s annual report on Form 10-K for the year ended February 2,
2008 and subsequent Forms 10-Q.
For additional information on Men’s Wearhouse, please visit the Company’s
website at http://www.tmw.com.
CONTACT: Neill Davis, EVP & CFO, Men's Wearhouse (281) 776-7000 Ken Dennard, DRG&E (713) 529-6600 THE MEN'S WEARHOUSE, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (Unaudited) FOR THE THREE MONTHS ENDED November 1, 2008 AND November 3, 2007 (In thousands, except per share data) Three Months Ended % of % of 2008 Sales 2007 Sales Net sales: Clothing product $334,415 72.75% $384,047 74.99% Tuxedo rental services 96,498 20.99% 96,090 18.76% Alteration and other services 28,760 6.26% 31,999 6.25% Total net sales 459,673 100.00% 512,136 100.00% Cost of sales: Clothing product including buying and distribution costs 143,793 31.28% 159,204 31.09% Tuxedo rental services 16,202 3.52% 16,383 3.20% Alteration and other services 23,673 5.15% 24,941 4.87% Occupancy costs 73,281 15.94% 71,137 13.89% Total cost of sales 256,949 55.90% 271,665 53.05% Gross margin 202,724 44.10% 240,471 46.95% Selling, general and administrative expenses 178,955 38.93% 181,307 35.40% Operating income 23,769 5.17% 59,164 11.55% Interest income (744) (0.16%) (1,352) (0.26%) Interest expense 978 0.21% 1,304 0.25% Earnings before income taxes 23,535 5.12% 59,212 11.56% Provision for income taxes 8,948 1.95% 22,145 4.32% Net earnings $14,587 3.17% $37,067 7.24% Net earnings per share: Basic $0.28 $0.70 Diluted $0.28 $0.69 Weighted average common shares outstanding: Basic 51,703 53,141 Diluted 52,011 53,775 THE MEN'S WEARHOUSE, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (Unaudited) FOR THE NINE MONTHS ENDED November 1, 2008, November 3, 2007 AND PRO FORMA November 3, 2007 (In thousands, except per share data) Nine Months Ended % of % of Pro Forma % of 2008 Sales 2007 Sales 2007 Sales Net sales: Clothing product $1,109,014 74.13% $1,189,945 75.43% $1,193,463 74.24% Tuxedo rental services 294,145 19.66% 290,521 18.42% 316,855 19.71% Alteration and other services 92,899 6.21% 97,134 6.16% 97,262 6.05% Total net sales 1,496,058 100.00% 1,577,600 100.00% 1,607,580 100.00% Cost of sales: Clothing product including buying and distribution costs 484,758 32.40% 512,360 32.48% 514,974 32.03% Tuxedo rental services 49,569 3.31% 52,072 3.30% 56,313 3.50% Alteration and other services 73,608 4.92% 74,346 4.71% 74,346 4.62% Occupancy costs 220,601 14.75% 197,580 12.52% 203,974 12.69% Total cost of sales 828,536 55.38% 836,358 53.01% 849,607 52.85% Gross margin 667,522 44.62% 741,242 46.99% 757,973 47.15% Selling, general and administrative expenses 574,491 38.40% 534,139 33.86% 563,918 35.08% Operating income 93,031 6.22% 207,103 13.13% 194,055 12.07% Interest income (2,259) (0.15%) (4,655) (0.30%) (4,177) (0.26%) Interest expense 3,617 0.24% 3,513 0.22% 3,724 0.23% Earnings before income taxes 91,673 6.13% 208,245 13.20% 194,508 12.10% Provision for income taxes 34,318 2.29% 76,019 4.82% 70,878 4.41% Net earnings $57,355 3.83% $132,226 8.38% $123,630 7.69% Net earnings per share: Basic $1.11 $2.47 $2.31 Diluted $1.10 $2.44 $2.28 Weighted average common shares outstanding: Basic 51,604 53,614 53,614 Diluted 51,913 54,284 54,284
Note: The pro forma condensed consolidated statement of earnings presents
the Company’s results of operations as if the After Hours acquisition had
occurred on January 29, 2006, after giving effect to certain purchase
accounting adjustments. The pro forma information is not necessarily
indicative of actual results had the acquisition occurred on January 29, 2006.
THE MEN'S WEARHOUSE, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands) (Unaudited) November 1, November 3, 2008 2007 ASSETS Current assets: Cash and cash equivalents $84,337 $102,531 Short-term investments 17,434 - Accounts receivable, net 17,804 24,118 Inventories 490,831 515,917 Other current assets 66,223 69,217 Total current assets 676,629 711,783 Property and equipment, net 393,391 392,917 Tuxedo rental product, net 84,702 71,120 Goodwill 58,695 73,674 Other assets, net 18,361 23,204 Total assets $1,231,778 $1,272,698 LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts payable $130,944 $131,543 Accrued expenses and other current liabilities 102,347 123,214 Income taxes payable 468 19,425 Total current liabilities 233,759 274,182 Long-term debt 88,608 92,595 Deferred taxes and other liabilities 65,674 68,294 Total liabilities 388,041 435,071 Shareholders' equity: Preferred stock - - Common stock 699 695 Capital in excess of par 312,485 301,690 Retained earnings 926,468 868,968 Accumulated other comprehensive income 16,621 51,929 Total 1,256,273 1,223,282 Treasury stock, at cost (412,536) (385,655) Total shareholders equity 843,737 837,627 Total liabilities and equity $1,231,778 $1,272,698 THE MEN'S WEARHOUSE, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) FOR THE NINE MONTHS ENDED November 1, 2008 AND November 3, 2007 (In thousands) Nine Months Ended 2008 2007 CASH FLOWS FROM OPERATING ACTIVITIES: Net earnings $57,355 $132,226 Non-cash adjustments to net earnings: Depreciation and amortization 68,699 57,293 Tuxedo rental product amortization 31,739 36,976 Other 11,691 7,987 Changes in assets and liabilities (81,423) (91,398) Net cash provided by operating activities 88,061 143,084 CASH FLOWS FROM INVESTING ACTIVITIES: Capital expenditures (69,485) (90,394) Net non-cash assets acquired - (68,253) Purchases of available-for-sale investments (17,434) (277,480) Proceeds from sales of available-for-sale investments 59,921 277,480 Other investing activities 175 (91) Net cash used in investing activities (26,823) (158,738) CASH FLOWS FROM FINANCING ACTIVITIES: Cash dividends paid (10,936) (9,186) Proceeds from revolving credit facility 150,600 - Payments on revolving credit facility (105,975) - Payments on Canadian term loan (31,880) - Proceeds from issuance of common stock 2,359 6,323 Purchase of treasury stock (156) (78,080) Other financing activities (1,277) 1,195 Net cash provided by (used in) financing activities 2,735 (79,748) Effect of exchange rate changes (19,082) 18,239 INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 44,891 (77,163) Balance at beginning of period 39,446 179,694 Balance at end of period $84,337 $102,531
SOURCE Men’s Wearhouse
Released November 19, 2008