Weighed down by a 9.4 percent same-store sales decline for its Jos. A. Bank unit, second-quarter total sales declined for The Men’s Wearhouse Inc. while earnings increased on stronger gross margins.
Net income jumped to $47.8 million, or 98 cents per share, from $12.3 million, or 25 cents, in the same period last year as total sales fell 1.1 percent to $920.1 million from $929.9 million. Adjusted earnings came in at $52.2 million, or $1.07 per share.
By retail brand, Doug Ewert, chief executive officer, said comparable-store sales rose 3.1 percent at Men’s Wearhouse, 0.7 percent at Moores and 6.7 percent at K&G. “Excluding rental revenue, Men’s Wearhouse clothing comps were 6.5 percent driven by higher average unit retails,” he added. “Men’s Wearhouse comparable rental revenue decreased 3.3 percent, which was slightly better than internal expectations.”
Related Articles
Total gross margins in the quarter rose 74 basis points to 45.6 percent of sales. Operating income gained 3.1 percent to $105.7 million from $102.5 million in the prior year.
You May Also Like
Regarding the performance of Jos. A. Bank, Ewert said, “Now that we have a full year under our belt, we have become even more convinced that changing the promotional messages to be clear and compelling without unusual quantity requirements — like buy-one-get-three-free offers — will broaden the appeal of the Joseph A. Bank brand.”
Ewert said this fall the company will be “well-positioned to fully implement our strategy as all systems will be integrated, new products will be introduced, the new customer rewards program will be available, we will have new sales force incentives supported with extensive training and we will have new marketing strategies in place.”
The ceo said the company is “focused on rebuilding the Jos. A. Bank profit model. In doing so, we expect top-line volatility as we establish a promotional model with broader customer appeal and strengthen the margin profile.”
As a result, the company expects earnings-per-share guidance to be in the range of $2.70 to $2.90 for the fiscal year. In the first quarter, results beat Wall Street consensus expectations while the retailer also announced a deal with Macy’s Inc. for tuxedo sales.
A conference call with investors is set for Wednesday.