Net sales up 1% at Men's Wearhouse in Q2 FY'12

Net earnings for the 2012 fiscal second quarter was $59.4 million, or $1.15 diluted earnings per share, compared to net earnings of $57.1 million, or $1.09 diluted earnings per share, in the same period in 2011.

Last year's second quarter adjusted diluted earnings per share was $1.11 after excluding $0.7 million ($0.5 million after tax or $0.01 per diluted share) in acquisition related integration costs and $1.0 million ($0.7 million after tax or $0.01 per diluted share) for a non-cash asset impairment charge.

Net sales for the second quarter of fiscal 2012 increased 1.0% to $662.3 million from $655.5 million for the same period a year ago, in line with expectations, and retail segment sales increased 3.2% or $18.7 million. 

Diluted earnings per share of $1.15 was better than the $1.12 to $1.13 guidance given on June 6, 2012 mainly as a result of a higher than planned retail segment gross margin for second quarter 2012 and a slightly lower than expected tax rate.

Doug Ewert, Men's Wearhouse president and chief executive officer, stated, "Sales at our flagship brand Men's Wearhouse stores, which represented approximately 65% of our total second quarter sales, were above both prior year sales and our plan for the 2012 second quarter. 

“Comparable store sales increased 4.4% as our customers continue to respond positively to our long standing service model and our trend right men's apparel during both promotional and non-promotional periods.

“In addition, our higher margin tuxedo rental revenues experienced strong U.S. comparable store sales of 4.3% in the second quarter, driven by increased unit rentals and unit rental rates as well as increased sales of tuxedo accessories.

"Moores, our retail brand in Canada, was roughly 12% of our total sales mix in the 2012 second quarter and also had a better than expected comparable store sales increase of 2.5%.  Moores continues to perform well in its market," continued Ewert. "K&G's sales, which were roughly 14% of our total sales for the second quarter, fell below our expectations with a comparable store sales decrease of 3.3%. 

“We continue to focus on improving K&G's performance and in late August we rolled out our new marketing campaign featuring Blair Underwood, accomplished actor and Broadway star.  We are excited about this initiative and about having an exclusive relationship to sell his BU Collection, a premier line of men's tailored suits. 

“Our Corporate Apparel segment, which represented 9% of our total 2012 second quarter sales, performed as planned for the quarter and is poised for a solid second half as launch dates for customer uniform programs come into effect."