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Comparable store sales up at each of Men's Wearhouse brands

09 Sep '11

5 min read

The Men's Wearhouse announced its consolidated financial results for the second quarter ended July 30, 2011.

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. Insecond 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 attribu`table 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.

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