Jos. A. Bank sales continue to decline in Q3

The Men's Wearhouse reported GAAP loss per share for fiscal third quarter 2015 of 0.56 dollar. Adjusted EPS was 0.50 dollar. As reported in the company's preliminary results release on November 5, 2015, third quarter comparable sales increased 5.3 percent at Men's Wearhouse with clothing comps of 7.2 percent driven by higher transactions per store and rental comps of 0.7 percent. Comparable sales decreased 14.6 percent at Jos. A. Bank, far below our earlier expectations.

“When we acquired Joseph Bank, we knew that we needed to correct the promotional model. However, we underestimated the impact to the near-term performance as we began to execute the difficult, but necessary, corrective steps. We remain confident that these steps will restore a long-term, sustainable, profit model and reshape the business for a healthy and growing Jos. A. Bank. We have built a portfolio of robust and compelling brands, each renowned for their own individual identity. Next year, we will launch a holding company called Tailored Brands,” said Doug Ewert, CEO of Men's Wearhouse.

Third quarter sales review

Net sales at Men's Wearhouse, were up 6.7 percent and comparable sales increased 5.3 percent from last year's third quarter. Comparable clothing sales increased 7.2 percent primarily due to an increase in average transactions per store. Comparable rental revenue increased 0.7 percent.

Jos. A. Bank comparable sales decreased 14.6 percent due primarily to a decrease in average transactions per store as the company began the transition away from the ‘Buy-One-Get-Three Free’ promotional events. K&G comparable sales increased 3.7 percent primarily due to an increase in average transactions per store. Net sales for Moores, Canadian retail brand, decreased 18.7 percent due to unfavorable currency fluctuations. Moores had a comparable sales decrease of 5.4 percent due to decreases in both average transactions per store and units sold per transaction driven by weakening macro-economic conditions in Canada. The corporate apparel segment witnessed an expected sales decrease of 10.4 percent.

On a GAAP basis, total net sales decreased 2.8 percent, or 25.2 million dollars, to 865.4 million dollars. Retail segment net sales decreased by 2.2 percent, or 17.8 million dollars. Corporate apparel sales decreased by 10.4 percent or 7.4 million dollars. On an adjusted basis, total net sales decreased 2.8 percent, or 25.2 million dollars. Retail segment net sales decreased by 2.2 percent or 17.8 million dollars due primarily to a decrease in clothing sales at Jos. A. Bank. Corporate apparel sales decreased by 10.4 percent or 7.4 million dollars. Net earnings were 24.1 million dollars, or 0.50 dollar adjusted EPS.

Nine months GAAP and adjusted results

Total net sales increased 14.9 percent, or 346.4 million dollars, to 2,670.6 million dollars. Retail segment net sales increased by 16.7 percent, or 355.3 million dollars. Corporate apparel sales decreased by 4.6 percent or 8.9 million dollars. Net earnings for the nine months were 31 million dollars compared to 35.5 million dollars last year. Diluted EPS was 0.64 dollar compared to 0.74 dollar in the prior year nine months.

Total net sales increased 0.1 percent, or 2.1 million dollars on an adjusted basis. Retail segment net sales for the nine months increased by 0.5 percent, or 11.1 million dollars, due primarily to an increase in clothing sales at Men's Wearhouse. Corporate apparel sales decreased by 4.6 percent, or 8.9 million dollars.