The Men's Wearhouse announced consolidated financial results for the fiscal first quarter ended May 3, 2014.
Total net sales for fiscal first quarter 2014 increased 2.3% to $630.5 million, and total Men's Wearhouse brand revenues were up 4.8% over fiscal first quarter 2013. GAAP diluted EPS for fiscal first quarter 2014 was $0.34 and adjusted EPS was $0.69 excluding one-time costs.
First Quarter Consolidated Results Review
Total net sales for the fiscal 2014 first quarter increased 2.3% or $13.9 million to $630.5 million from $616.5 million. Retail segment sales for the quarter increased by 2.4% or $13.5 million and corporate apparel sales increased by 0.8% or $0.5 million as compared to the prior year quarter.
The consolidated total gross margin was up $5.4 million or 2.0% to the prior year quarter. The total gross margin rate decreased 13 basis points primarily due to promotional events and a decrease in the tuxedo rental services gross margin rate as a result of increased royalty expenses. The retail segment total gross margin was up 2.2% and the corporate apparel gross margin decreased 1.9%.
GAAP SG&A expenses were $256.1 million. Adjusted SG&A expenses of $229.6 million increased by $4.3 million from the prior year or 1.9% primarily due to an increase in advertising expense. Adjusted SG&A expenses exclude $26.5 million in costs related to various strategic projects, primarily Jos. A. Bank and cost reduction initiatives.
GAAP net earnings were $16.5 million. Adjusted net earnings for the fiscal 2014 first quarter were $33.1 million, or $0.69 adjusted earnings per share compared to net earnings of $33.1 million, or $0.65 diluted earnings per share last year.
Doug Ewert, Men's Wearhouse president and chief executive officer, commented, "We were pleased to report adjusted EPS of $0.69 despite the Easter-driven tuxedo timing shift that moved revenue to the second quarter. Our Men's Wearhouse stores performed above plan with sales growing 4.8% over last year's first quarter and comparable sales up 2.9%. Moores' revenue was negatively affected by currency exchange rates during the quarter but performed very well, with comparable store sales rising 6.0%. While GAAP operating income decreased, we grew adjusted operating income for all retail brands and were able to leverage SG&A despite an increase in advertising.
"We are excited about our near-term and long-term opportunities. As previously disclosed, the Federal Trade Commission terminated the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended. We now expect to complete the combination of Men's Wearhouse and Jos. A. Bank within the next few weeks and look forward to achieving the benefits of the combination for our shareholders," concluded Ewert.