TAILORED BRANDS INC - FORM 8-K - EX-99.1

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8-K - FORM 8-K - TAILORED BRANDS INC	h84544e8vk.htm

Exhibit 99.1


		*News Release*


		Contacts:
For Immediate Release
		Neill Davis, Men’s Wearhouse
		(281) 776-7000
		Ken Dennard, DRG&L
		(713) 529-6600

MEN’S WEARHOUSE REPORTS
FISCAL 2011 SECOND QUARTER RESULTS

•

Q2 2011 GAAP diluted earnings per share was $1.09 and adjusted diluted earnings per share was $1.11

•

Company provides guidance for third quarter and updated guidance for full year of fiscal 2011

•

Conference call at 5:00 pm Eastern today

HOUSTON — September 7, 2011 — The Men’s Wearhouse (NYSE: MW) today announced its consolidated financial results for the second quarter ended July 30, 2011.


	Second Quarter Net Sales Summary - Fiscal 2011
							Total Net
							Sales			Comparable Store Sales
	U.S. dollars, in millions						Change %			Change % (c)
	Current Year			Prior Year						Current Year			Prior Year

Total Company	$	655.5	(a)	$	537.0	(a)		22.1	%

Total Retail Segment	$	586.0		$	532.4			10.1	%

MW		407.0			367.4			10.8	%		10.9	%		2.7	%

K&G		92.5			87.6			5.7	%		5.4	%		-4.6	%

Moores Canada		80.3			71.6			12.3	%		4.4	%(b)		0.6	%(b)

Corporate Apparel Segment	$	69.5		$	4.6			1,401.3	%


	Year-To-Date Net Sales Summary - Fiscal 2011
							Total Net
							Sales			Comparable Store Sales
	U.S. dollars, in millions						Change %			Change % (c)
	Current Year			Prior Year						Current Year			Prior Year

Total Company	$	1,235.9	(a)	$	1,010.5	(a)		22.3	%

Total Retail Segment	$	1,106.7		$	1,002.1			10.4	%

MW		761.7			685.7			11.1	%		10.8	%		2.6	%

K&G		199.3			185.8			7.2	%		7.5	%		-4.8	%

Moores Canada		133.5			118.9			12.2	%		5.0	%(b)		0.5	%(b)

Corporate Apparel Segment	$	129.2		$	8.3			1,454.4	%


(a)		Due to rounded numbers, total Company may not sum.

(b)		Comparable store sales change is based on the Canadian dollar.

(c)		Does not include ecommerce sales.

Page 1

GAAP diluted earnings per share were $1.09 for the second quarter ended July 30, 2011. Adjusted diluted earnings per share were $1.11 after excluding $0.7 million ($0.5 million after tax or $0.01 per diluted share outstanding) in acquisition integration expenses and $1.0 million ($0.7 million after tax or $0.01 per diluted share outstanding) for a non-cash asset impairment charge. This compares to adjusted diluted earnings per share guidance given June 8, 2011 of $1.02 to $1.05. In second quarter fiscal 2010, GAAP diluted earnings per share were $0.81 and adjusted diluted earnings per share were $0.84 after excluding $2.7 million ($1.7 million after tax or $0.03 per diluted share outstanding) in acquisition costs.

GAAP diluted earnings per share were $1.61 for the six months ended July 30, 2011. Adjusted diluted earnings per share were $1.64 after excluding $1.4 million ($0.9 million after tax or $0.02 per diluted share outstanding) in acquisition integration expenses and $1.0 million ($0.7 million after tax or $0.01 per diluted share outstanding) for a non-cash asset impairment charge. For the six months ended July 31, 2010, GAAP diluted earnings per share were $1.06 and adjusted diluted earnings per share were $1.09 after excluding $2.7 million ($1.7 million after tax or $0.03 per diluted share outstanding) in acquisition costs.

SECOND QUARTER HIGHLIGHTS

Total Company net sales increased 22.1% for the quarter. The Company’s acquisition of Dimensions and Alexandra in the UK (completed on August 6, 2010 and included in the Company’s corporate apparel segment) contributed $63.2 million of the consolidated sales increase or 11.8% of the consolidated growth rate.

In our retail segment, comparable store sales increased at each of our brands. The increases were primarily attributable to increased retail clothing product sales. Increases at Men’s Wearhouse/Men’s Wearhouse and Tux were driven by increases in average units sold per transaction and increased store traffic levels offsetting decreases in average unit retails. Increases at K&G were driven by increases in average unit retails and units sold per transaction offsetting decreases in store traffic levels. Increases at Moores were driven by increases in units sold per transaction offsetting decreases in average unit retails and store traffic levels. There was also a 6.2% comparable store sales increase in U.S. tuxedo rental services revenues.

Retail segment total gross margin, as a percentage of related net sales, increased 104 basis points. Lower product margins, which resulted mainly from increased promotions, were primarily offset by leverage of fixed occupancy costs.

Adjusted selling, general and administrative expenses increased 15.9%, but as a percentage of total net sales decreased 177 basis points. The Company’s corporate apparel segment drove 7.6% of the quarter over quarter increase and the balance, 8.3%, was related to payroll costs and increased expenses associated with increased sales in the Company’s retail segment.

Page 2

Operating income was $89.0 million. Excluding $0.7 million in acquisition integration costs and $1.0 million for a non-cash asset impairment charge, operating income was $90.8 million or 13.9% of total net sales. This compares with the adjusted prior year operating income of $71.8 million or 13.4% of total net sales, which excluded $2.7 million in costs associated with the acquisitions.

The financial results of the combined UK operations, excluding acquisition integration costs, were $0.03 accretive to the Company’s second quarter diluted earnings per share. Integration costs were $0.7 million ($0.5 million after tax or $0.01 per diluted share outstanding).

Total inventories of $547.9 million increased 30.3% from the prior year second quarter of $420.4 million. Excluding inventory from the acquired UK operations, inventories increased 9.9% to support increased retail sales and planned promotions in the second half of fiscal 2011.

The Company did not repurchase any shares of its common stock during the second quarter; however, the Company did repurchase 500,000 shares at an average cost of $29.98 per share subsequent to quarter end.

Page 3

2011 GUIDANCE

For the fiscal year, GAAP diluted earnings per share is expected to be in a range of $2.07 to $2.14. Adjusted diluted earnings per share are expected to be in a range of $2.13 to $2.20. Adjusted earnings per share exclude acquisition integration expenses and impairment charges of $4.6 million ($3.0 million after tax or $0.06 per diluted share outstanding).

For the third quarter of the fiscal year, GAAP diluted earnings per share is expected to be in a range of $0.62 to $0.64. Adjusted diluted earnings per share are expected to be in a range of $0.64 to $0.66. Adjusted earnings per share exclude acquisition integration expenses of $1.6 million ($1.1 million after tax or $0.02 per diluted share outstanding).

The financial results of the combined UK acquisitions, excluding acquisition integration expenses, are expected to be accretive to the Company’s full year and third quarter diluted earnings per share.


	Guidance		Guidance
	FY 2011		3Q FY 2011
Total Sales Increase	12.5% to 13.5%(1)		3.0% to 4.0%(1)

Comparable Store Sales Growth (2)
MW	+7% to +8%		+2% to +3%

K&G	+4% to +5%		+2% to +3%

Moores	+2% to +3%		flat to +1%

Gross Profit Margin	43.25% to 43.45%(3)		44.75% to 44.90%(3)

S G & A (as % of Sales)	36.00% to 36.15%(4)		35.75% to 35.90%(4)

Effective Tax Rate		34.9%		33.9%

Weighted Average Shares Outstanding (millions)		51.7		51.4

GAAP EPS (5)	$2.07 to $2.14		$0.62 to $0.64

Adjusted EPS (5)	$2.13 to $2.20(4)		$0.64 to $0.66(4)

Foreign Exchange Conversion (avg.)
US Dollar to GBP		1.63		1.63

US Dollar to Canadian Dollar		1.02		1.01

Footnotes to Guidance:


1.		Includes US$225 million for full year FY 2011 and US$55 million for 3Q FY 2011 of sales from acquired operations of Dimensions and Alexandra.

2.		Includes an assumed U.S. comparable store increase in tuxedo rental revenues of 4% to 5% for the full year FY 2011 and a flat to 1% increase in 3Q FY 2011.

3.		Occupancy costs are expected to be flat to a low single digit decrease for full year FY 2011 and flat to 1% increase for 3Q FY 2011.

4.		Excludes acquisition integration costs and impairment charges.

5.		Reflects the dilutive effect of participating securities which approximates $0.01 for the third quarter and $0.03 for the full year.

Page 4

CONFERENCE CALL AND WEBCAST INFORMATION

At 5:00 p.m. Eastern time on Wednesday, September 7, 2011, Company management will host a conference call and real time webcast to review the second quarter of fiscal 2011 and its outlook for the third quarter and full year of fiscal 2011.

To access the conference call, dial 480-629-9818. To access the live webcast presentation, visit the Investor Relations section of the Company’s website at www.menswearhouse.com. A telephonic replay will be available through September 14, 2011 by calling 303-590-3030 and entering the access code of 4468052#, or a webcast archive will be available free on the website for approximately 90 days.

STORE INFORMATION


	July 30, 2011				July 31, 2010				January 29, 2011
	Number		Sq. Ft.		Number		Sq. Ft.		Number		Sq. Ft.
	of Stores		(000’s)		of Stores		(000’s)		of Stores		(000’s)
Men’s Wearhouse		591		3,364.3		584		3,307.0		585		3,319.0


Men’s Wearhouse and Tux		370		514.3		434		596.4		388		535.7


Moores, Clothing for Men		117		738.9		117		735.7		117		737.8


K&G ^(a)		100		2,369.9		104		2,426.7		102		2,394.1


Total		1,178		6,987.4		1,239		7,065.8		1,192		6,986.6


^(a)		90, 95 and 91 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 1,178 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 Men’s Wearhouse and Tux stores carry a limited selection. Tuxedo rentals are available in the Men’s Wearhouse, Moores and Men’s Wearhouse and Tux stores. Additionally, Men’s Wearhouse operates a global corporate apparel and workwear group consisting of TwinHill in the United States and Dimensions and Alexandra in the United Kingdom.

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, changes in foreign currency rates and other factors described in the Company’s annual report on Form 10-K for the fiscal year ended January 29, 2011 and Form 10-Q for the quarter ended April 30, 2011.

For additional information on Men’s Wearhouse, please visit the company’s website at www.menswearhouse.com. The website for K&G is www.kgstores.com. The website for Moores is www.mooresclothing.com. The website for Dimensions is www.dimensions.co.uk, the website for Alexandra is www.alexandra.co.uk and the website for TwinHill is www.twinhill.com.

Page 5

THE MEN’S WEARHOUSE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
(Unaudited)

FOR THE THREE MONTHS ENDED
July 30, 2011 AND July 31, 2010
(In thousands, except per share data)


	Three Months Ended												Variance
				% of						% of									Basis
	2011			Sales			2010			Sales			Dollar			%			Points
Net sales:
Retail clothing product	$	401,789			61.29	%	$	357,599			66.59	%	$	44,190			12.36	%		(5.30	)
Tuxedo rental services		148,267			22.62	%		142,462			26.53	%		5,805			4.07	%		(3.91	)
Alteration and other services		35,978			5.49	%		32,299			6.01	%		3,679			11.39	%		(0.53	)

Total retail sales		586,034			89.40	%		532,360			99.14	%		53,674			10.08	%		(9.74	)
Corporate apparel clothing product sales		69,495			10.60	%		4,629			0.86	%		64,866			1,401.30	%		9.74

Total net sales		655,529			100.00	%		536,989			100.00	%		118,540			22.07	%		0.00

Total cost of sales		346,284			52.83	%		276,717			51.53	%		69,567			25.14	%		1.29


Gross margin (a):
Retail clothing product		222,893			55.48	%		200,507			56.07	%		22,386			11.16	%		(0.60	)
Tuxedo rental services		128,105			86.40	%		120,426			84.53	%		7,679			6.38	%		1.87
Alteration and other services		8,596			23.89	%		7,853			24.31	%		743			9.46	%		(0.42	)
Occupancy costs		(68,410	)		(11.67	)%		(69,803	)		(13.11	)%		1,393			2.00	%		1.44

Total retail gross margin		291,184			49.69	%		258,983			48.65	%		32,201			12.43	%		1.04
Corporate apparel clothing product margin		18,061			25.99	%		1,289			27.85	%		16,772			1,301.16	%		(1.86	)

Total gross margin		309,245			47.17	%		260,272			48.47	%		48,973			18.82	%		(1.29	)

Selling, general and administrative expenses		220,227			33.60	%		191,168			35.60	%		29,059			15.20	%		(2.00	)


Operating income		89,018			13.58	%		69,104			12.87	%		19,914			28.82	%		0.71

Net interest		(229	)		(0.03	)%		(275	)		(0.05	)%		46			16.73	%		(0.02	)

Earnings before income taxes		88,789			13.54	%		68,829			12.82	%		19,960			29.00	%		0.73

Provision for income taxes		31,519			4.81	%		25,867			4.82	%		5,652			21.85	%		(0.01	)


Net earnings including noncontrolling interest		57,270			8.74	%		42,962			8.00	%		14,308			33.30	%		0.74

Net earnings attributable to noncontrolling interest		(192	)		(0.03	)%		—			0.00	%		(192	)		100.00	%		(0.03	)


Net earnings attributable to common shareholders	$	57,078			8.71	%	$	42,962			8.00	%	$	14,116			32.86	%		0.71


Net earnings per diluted common share attributable to common shareholders	$	1.09					$	0.81


Weighted average diluted common shares outstanding:		51,792						52,806


(a)		Gross margin percent of sales is calculated as a percentage of related sales.

Page 6

THE MEN’S WEARHOUSE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
(Unaudited)

FOR THE SIX MONTHS ENDED
July 30, 2011 AND July 31, 2010
(In thousands, except per share data)


	Six Months Ended												Variance
				% of						% of								Basis
	2011			Sales			2010			Sales			Dollar		%			Points

Net sales:
Retail clothing product	$	812,050			65.70	%	$	722,289			71.48	%	$	89,761		12.43	%		(5.78	)
Tuxedo rental services		221,408			17.91	%		214,616			21.24	%		6,792		3.16	%		(3.33	)
Alteration and other services		73,287			5.93	%		65,240			6.46	%		8,047		12.33	%		(0.53	)

Total retail sales		1,106,745			89.55	%		1,002,145			99.18	%		104,600		10.44	%		(9.63	)
Corporate apparel clothing product sales		129,168			10.45	%		8,310			0.82	%		120,858		1,454.37	%		9.63

Total net sales		1,235,913			100.00	%		1,010,455			100.00	%		225,458		22.31	%		0.00

Total cost of sales		680,035			55.02	%		549,180			54.35	%		130,855		23.83	%		0.67


Gross margin (a):
Retail clothing product		445,781			54.90	%		400,607			55.46	%		45,174		11.28	%		(0.57	)
Tuxedo rental services		191,439			86.46	%		181,254			84.46	%		10,185		5.62	%		2.01
Alteration and other services		19,604			26.75	%		16,730			25.64	%		2,874		17.18	%		1.11
Occupancy costs		(135,581	)		(12.25	)%		(139,494	)		(13.92	)%		3,913		2.81	%		1.67

Total retail gross margin		521,243			47.10	%		459,097			45.81	%		62,146		13.54	%		1.29
Corporate apparel clothing product margin		34,635			26.81	%		2,178			26.21	%		32,457		1490.22	%		0.60

Total gross margin		555,878			44.98	%		461,275			45.65	%		94,603		20.51	%		(0.67	)

Selling, general and administrative expenses		423,223			34.24	%		370,818			36.70	%		52,405		14.13	%		(2.45	)


Operating income		132,655			10.73	%		90,457			8.95	%		42,198		46.65	%		1.78

Net interest		(497	)		(0.04	)%		(500	)		(0.05	)%		3		0.60	%		(0.01	)


Earnings before income taxes		132,158			10.69	%		89,957			8.90	%		42,201		46.91	%		1.79

Provision for income taxes		47,696			3.86	%		33,433			3.31	%		14,263		42.66	%		0.55


Net earnings including noncontrolling interest		84,462			6.83	%		56,524			5.59	%		27,938		49.43	%		1.24

Net loss attributable to noncontrolling interest		41			0.00	%		—			0.00	%		41		100	%		0.00


Net earnings attributable to common shareholders	$	84,503			6.84	%	$	56,524			5.59	%	$	27,979		49.50	%		1.24


Net earnings per diluted common share attributable to common shareholders	$	1.61					$	1.06


Weighted average diluted common shares outstanding:		51,994						52,717


(a)		Gross margin percent of sales is calculated as a percentage of related sales.

Page 7

THE MEN’S WEARHOUSE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)


	July 30,			July 31,
	2011			2010
ASSETS
Current assets:
Cash and cash equivalents	$	162,301		$	281,500
Accounts receivable, net		65,289			19,066
Inventories		547,899			420,386
Other current assets		66,087			60,195


Total current assets		841,576			781,147
Property and equipment, net		337,517			333,133
Tuxedo rental product, net		88,786			91,690
Goodwill		90,251			60,449
Intangible assets, net		36,839			2,504
Other assets		10,424			20,346


Total assets	$	1,405,393		$	1,289,269


LIABILITIES AND EQUITY

Current liabilities:
Accounts payable	$	130,068		$	82,163
Accrued expenses and other current liabilities		151,754			129,971
Income taxes payable		23,994			7,589
Current maturities of long-term debt		—			45,226


Total current liabilities		305,816			264,949
Deferred taxes and other liabilities		71,864			64,402


Total liabilities		377,680			329,351


Equity:
Preferred stock		—			—
Common stock		715			708
Capital in excess of par		351,181			332,677
Retained earnings		1,074,942			1,002,995
Accumulated other comprehensive income		49,327			36,308
Treasury stock, at cost		(461,760	)		(412,770	)


Total equity attributable to common shareholders		1,014,405			959,918
Noncontrolling interest		13,308			—


Total equity		1,027,713			959,918


Total liabilities and equity	$	1,405,393		$	1,289,269

Page 8

THE MEN’S WEARHOUSE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

FOR THE SIX MONTHS ENDED
July 30, 2011 AND July 31, 2010
(In thousands)


	Six Months Ended
	2011			2010
CASH FLOWS FROM OPERATING ACTIVITIES:

Net earnings including noncontrolling interest	$	84,462		$	56,524
Non-cash adjustments to net earnings:
Depreciation and amortization		37,805			36,885
Tuxedo rental product amortization		17,076			20,812
Other		9,751			11,177
Changes in assets and liabilities		(27,078	)		4,890


Net cash provided by operating activities		122,016			130,288


CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures		(38,258	)		(25,865	)
Proceeds from sales of property and equipment		51			23


Net cash used in investing activities		(38,207	)		(25,842	)


CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock		4,552			1,321
Cash dividends paid		(12,671	)		(9,535	)
Tax payments related to vested deferred stock units		(2,955	)		(2,656	)
Excess tax benefits from share-based plans		1,386			780
Purchase of treasury stock		(48,999	)		(144	)


Net cash used in financing activities		(58,687	)		(10,234	)


Effect of exchange rate changes		808			1,270

INCREASE IN CASH AND CASH EQUIVALENTS		25,930			95,482

Balance at beginning of period		136,371			186,018

Balance at end of period	$	162,301		$	281,500

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TAILORED BRANDS INC - FORM 8-K - EX-99.1 - September 7, 2011

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