Press Releases

Investors

Men's Wearhouse Reports Fiscal 2008 Second Quarter Results

- Q2 2008 GAAP diluted EPS was $0.63 and adjusted diluted EPS was $0.72, compared with Q2 2007 GAAP diluted EPS of $1.00

- Company estimates Q3 2008 GAAP diluted EPS in a range of $0.34 to $0.38 and adjusted diluted EPS in a range of $0.36 to $0.40

- Company estimates fiscal 2008 GAAP diluted EPS in a range of $1.38 to $1.48 and adjusted diluted EPS in a range of $1.50 to $1.60

- Conference call at 5:00 pm eastern today

    HOUSTON, Aug. 27 /PRNewswire-FirstCall/ -- The Men's Wearhouse (NYSE: MW)
today announced its consolidated financial results for the second quarter
ended August 2, 2008.



                               Second Quarter Sales Summary - Fiscal 2008
                                                 Total    Comparable Store
                          U.S. dollars, in       Sales          Sales
                              millions          Change %       Change %
                        Current       Prior               Current   Prior
                         Year         Year                 Year     Year
    Total Company       $545.3      $569.3       -4.2%
      MW                $362.7(a)   $386.7(a)    -6.2%    -7.8%(b)  +3.7%(b)
      K&G                $96.4      $101.2       -4.7%    -8.9%     -6.9%
        United States   $470.0      $496.5       -5.3%    -8.0%     +1.1%
      Moores             $75.3       $72.8       +3.3%    -2.8%(c)  +8.4%(c)



                     Year-To-Date Sales Summary - Fiscal 2008
                                                 Total    Comparable Store
                          U.S. dollars, in       Sales          Sales
                              millions          Change %       Change %
                        Current       Prior               Current   Prior
                         Year         Year                 Year     Year
    Total Company     $1,036.4    $1,065.5       -2.7%
      MW                $690.6(a)   $719.0(a)    -3.9%    -7.2%(b)  +2.0%(b)
      K&G               $197.0      $211.2       -6.7%   -11.6%     -6.6%
        United States   $911.3      $947.4       -3.8%    -8.2%     -0.1%
      Moores            $125.1      $118.1       +5.9%    -3.3%(c)  +7.3%(c)

    (a)  Includes retail stores and ecommerce as well as the MW Tux stores
         resulting from the acquisition of After Hours on April 9, 2007.

    (b)  Comparable store sales do not include ecommerce.  MW Tux stores are
         included beginning Q2 of fiscal 2008.

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


Diluted earnings per share were $0.63 for the second quarter ended August 2, 2008. Adjusted diluted earnings per share were $0.72 after excluding $4.5 million (net of tax), $0.09 per diluted share outstanding, of closure costs incurred in connection with the Company's previously announced planned closure of the Canadian based manufacturing facility operated by the Company's subsidiary, Golden Brand. This compares to adjusted diluted earnings per share guidance given July 9, 2008 of $0.70 to $0.74.

    SECOND Quarter Highlights
    -- Total company sales decreased 4.2% for the quarter.
       -- Apparel sales, representing 70.81% of 2008 total net sales,
          decreased 4.0% primarily due to decreases in the Company's
          comparable store sales driven by a reduction in store traffic
          levels.
       -- Tuxedo rental revenues, representing 23.37% of 2008 total net sales,
          decreased 5.3%.  This decline was primarily driven by reduced tuxedo
          rental sales at the Company's stores acquired from After Hours.
          These declines were partially offset by increases at the Company's
          Men's Wearhouse stores.
    -- Gross margin before occupancy costs, as a percentage of total net
       sales, decreased 27 basis points from 60.20% to 59.93%.  Decreases in
       clothing product margins, as a percentage of related sales, of 110
       basis points were offset by an increase in tuxedo rental services gross
       margin, as a percentage of related sales, of 302 basis points from
       80.66% to 83.68%.
    -- Occupancy costs increased, as a percentage of total net sales, by 154
       basis points from 11.99% to 13.53% primarily due to the deleveraging
       effect of reduced comparable store sales and increased rental rates for
       new and renewed leases.
    -- Selling, general, and administrative expenses were $198.9 million.
       Excluding $7.3 million in costs associated with the closing of Golden
       Brand, SG&A expenses of $191.6 million were essentially flat compared
       to the prior year quarter and as a percentage of total net sales
       increased 144 basis points from 33.69% to 35.13%.  This increase was
       primarily due to the deleveraging effect of reduced net sales.
    -- Operating income was $54.2 million.  Excluding $7.3 million in costs
       associated with the closing of Golden Brand, operating income was
       $61.5 million, or 11.27% of total net sales compared to $82.7 million,
       or 14.52% of total net sales for the same period last year.
    -- The effective tax rate for the 2008 second quarter was 39.0%.

THIRD QUARTER 2008 GUIDANCE

On July 11, 2008, the Canadian based manufacturing facility operated by the Company's subsidiary, Golden Brand, was closed. The Company estimates the pre tax cost to close the facility will be approximately $9.8 million or the equivalent of $0.12 per diluted share outstanding for the fiscal year. The pre tax cost for the first quarter was $0.9 million or the equivalent of $0.01 per diluted share outstanding. The pre tax cost for the second quarter was $7.3 million or the equivalent of $0.09 per diluted share outstanding and the pre tax cost for the third quarter is estimated at $1.6 million or the equivalent of $0.02 per diluted share outstanding.

Excluding the estimated Golden Brand closure costs for the third quarter of $0.02 per diluted share outstanding, the Company expects adjusted diluted earnings per share to be $0.36 to $0.40. Including these costs, GAAP diluted earnings per share are expected to be $0.34 to $0.38. This guidance assumes same store sales at MW, including MW Tux stores, to decrease in the high single digit range, at K&G to decrease in the mid single digit range and at Moores to decrease in the low single digit range.

The guidance includes an estimated effective tax rate of approximately 38.5% for the third quarter. The fully diluted shares outstanding are estimated to be 51.9 million.

FISCAL 2008 GUIDANCE

The Company is updating its adjusted diluted earnings per share outlook for the year to a range of $1.50 to $1.60 excluding the estimated Golden Brand closure costs of $0.12 per diluted share outstanding. Including these costs, GAAP diluted earnings per share are expected to be $1.38 to $1.48. This annual guidance reflects a comparable store sales decrease in the mid single digits for TMW, a high single digit decrease at K&G, and a low single digit decrease for Moores.

CONFERENCE CALL AND WEBCAST INFORMATION

At 5:00 p.m. Eastern time on Wednesday, August 27, 2008, company management will host a conference call and real time web cast to review the fiscal second quarter and its outlook for fiscal 2008.

To access the conference call, dial 303-262-2137. To access the live webcast presentation, visit the Investor Relations section of the Company's website at http://www.tmw.com. A telephonic replay will be available through September 3, 2008 by calling 303-590-3000 and entering the access code of 11117171# or a webcast archive will be available free on the website for approximately 90 days.



   STORE INFORMATION
                          August 2, 2008    August 4, 2007   February 2, 2008

                         Number   Sq. Ft.   Number  Sq. Ft.   Number  Sq. Ft.
                           of     (000's)     of    (000's)     of    (000's)
                         Stores             Stores            Stores

    Men's Wearhouse       572    3,213.9     553   3,091.8     563   3,152.6

    MW Tux(a)             493      668.6     500     639.5     489     652.0

    Moores, Clothing      116      721.2     116     722.6     116     719.8
     for Men

    K&G(b)                106    2,442.6     100   2,326.8     105   2,428.8


    Total               1,287    7,046.3   1,269   6,780.7   1,273   6,953.2



    (a)  MW Tux stores resulting from the acquisition of After Hours on
         April 9, 2007.

    (b)  90, 83 and 89 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 1,287 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 the MW Tux (formerly After Hours) stores carry a limited selection. Tuxedo rentals are available in the Men's Wearhouse, Moores and MW Tux stores.

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 and other factors described in the Company's annual report on Form 10-K for the year ended February 2, 2008 and Form 10-Q for the quarter ended May 3, 2008.

For additional information on Men's Wearhouse, please visit the Company's website at http://www.tmw.com.

    CONTACT:  Neill Davis, EVP & CFO, Men's Wearhouse  (281) 776-7200
              Ken Dennard, DRG&E  (713) 529-6600



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

                           FOR THE THREE MONTHS ENDED
                        August 2, 2008 AND August 4, 2007
                      (In thousands, except per share data)

                                                   Three Months Ended
                                                    % of                % of
                                            2008    Sales      2007     Sales

    Net sales:
      Clothing product                   $386,108   70.81%  $402,399   70.68%
      Tuxedo rental services              127,453   23.37%   134,570   23.64%
      Alteration and other services        31,728    5.82%    32,377    5.69%
          Total net sales                 545,289  100.00%   569,346  100.00%

    Cost of sales:
      Clothing product including
       buying and distribution costs      172,474   31.63%   175,313   30.79%
      Tuxedo rental services               20,802    3.81%    26,020    4.57%
      Alteration and other services        25,204    4.62%    25,250    4.43%
      Occupancy costs                      73,766   13.53%    68,265   11.99%
          Total cost of sales             292,246   53.59%   294,848   51.79%

    Gross margin                          253,043   46.41%   274,498   48.21%

    Selling, general and
     administrative expenses              198,886   36.47%   191,822   33.69%

    Operating income                       54,157    9.93%    82,676   14.52%

    Interest income                          (694)  (0.13%)   (1,671)  (0.29%)
    Interest expense                        1,040    0.19%     1,123    0.20%

    Earnings before income taxes           53,811    9.87%    83,224   14.62%

    Provision for income taxes             20,986    3.85%    28,998    5.09%

    Net earnings                          $32,825    6.02%   $54,226    9.52%


    Net earnings per share:
      Basic                                 $0.64              $1.01
      Diluted                               $0.63              $1.00

    Weighted average common shares
     outstanding:
       Basic                               51,639             53,739
       Diluted                             51,862             54,366



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

                             FOR THE SIX MONTHS ENDED
           August 2, 2008, August 4, 2007 AND PRO FORMA August 4, 2007
                      (In thousands, except per share data)

                                          Six Months Ended
                                                               Pro
                                  % of              % of      Forma    % of
                           2008   Sales     2007    Sales     2007     Sales

    Net sales:
      Clothing product  $774,599  74.74%  $805,899  75.64%  $809,417  73.89%
      Tuxedo rental
       services          197,647  19.07%   194,430  18.25%   220,764  20.15%
      Alteration and
       other services     64,139   6.19%    65,135   6.11%    65,263   5.96%
          Total net
           sales       1,036,385 100.00% 1,065,464 100.00% 1,095,444 100.00%

    Cost of sales:
      Clothing product
       including buying
       and distribution
       costs             340,965  32.90%   353,157  33.15%   355,771  32.48%
      Tuxedo rental
       services           33,367   3.22%    35,689   3.35%    39,930   3.65%
      Alteration and
       other services     49,935   4.82%    49,405   4.64%    49,405   4.51%
      Occupancy costs    147,320  14.21%   126,442  11.87%   132,836  12.13%
          Total cost
           of sales      571,587  55.15%   564,693  53.00%   577,942  52.76%


    Gross margin         464,798  44.85%   500,771  47.00%   517,502  47.24%

    Selling, general
     and administrative
     expenses            395,536  38.16%   352,832  33.12%   382,611  34.93%


    Operating income      69,262   6.68%   147,939  13.88%   134,891  12.31%

    Interest income       (1,515) (0.15%)   (3,303) (0.31%)   (2,825) (0.26%)
    Interest expense       2,639   0.25%     2,209   0.21%     2,420   0.22%


    Earnings before
     income taxes         68,138   6.57%   149,033  13.99%   135,296  12.35%

    Provision for
     income taxes         25,370   2.45%    53,874   5.06%    48,733   4.45%


    Net earnings         $42,768   4.13%   $95,159   8.93%   $86,563   7.90%

    Net earnings
     per share:
      Basic                $0.83             $1.77             $1.61
      Diluted              $0.82             $1.74             $1.59

    Weighted average
     common shares
     outstanding:
      Basic               51,555            53,851            53,851
      Diluted             51,863            54,538            54,538

    Note:  The pro forma condensed consolidated statement of earnings presents
           the Company's results of operations as if the After Hours
           acquisition had occurred on January 29, 2006, after giving effect
           to certain purchase accounting adjustments.  The pro forma
           information is not necessarily indicative of actual results had the
           acquisition occurred on January 29, 2006.



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

                                                        August 2,    August 4,
                                                           2008         2007

                         ASSETS

    Current assets:
      Cash and cash equivalents                        $119,248      $85,260
      Short-term investments                                  -       49,675
      Accounts receivable, net                           19,047       21,897
      Inventories                                       457,212      460,800
      Other current assets                               59,012       66,576

         Total current assets                           654,519      684,208
    Property and equipment, net                         400,791      370,066
    Tuxedo rental product, net                           90,860       76,727
    Goodwill                                             61,538       62,769
    Other assets, net                                    25,351       20,314

         Total assets                                $1,233,059   $1,214,084

    LIABILITIES AND SHAREHOLDERS' EQUITY

    Current liabilities:
      Accounts payable                                 $102,780      $98,441
      Accrued expenses and other current liabilities    118,113      138,975
      Income taxes payable                                9,347       13,715

         Total current liabilities                      230,240      251,131
    Long-term debt                                       84,221       82,033
    Deferred taxes and other liabilities                 67,320       61,811

         Total liabilities                              381,781      394,975

    Shareholders' equity:
      Preferred stock                                         -            -
      Common stock                                          698          695
      Capital in excess of par                          308,670      298,866
      Retained earnings                                 915,541      835,024
      Accumulated other comprehensive income             38,905       36,063
          Total                                       1,263,814    1,170,648

      Treasury stock, at cost                          (412,536)    (351,539)

          Total shareholders equity                     851,278      819,109

         Total liabilities and equity                $1,233,059   $1,214,084



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

                             FOR THE SIX MONTHS ENDED
                        August 2, 2008 AND August 4, 2007
                                  (In thousands)

                                                          Six Months Ended
                                                          2008         2007

    CASH FLOWS FROM OPERATING ACTIVITIES:
     Net earnings                                       $42,768      $95,159
     Non-cash adjustments to net earnings:
        Depreciation and amortization                    46,925       36,757
        Tuxedo rental product amortization               21,819       25,646
        Other non-cash adjustments                        4,606       (1,128)
     Changes in assets and liabilities                  (30,511)     (44,765)

          Net cash provided by operating activities      85,607      111,669

    CASH FLOWS FROM INVESTING ACTIVITIES:
     Capital expenditures                               (49,524)     (52,712)
     Net non-cash assets acquired                             -      (68,129)
     Purchases of available-for-sale investments              -     (267,530)
     Proceeds from sales of available-for-sale
      investments                                        59,921      217,855
     Other investing activities                              12          (65)

          Net cash provided by (used in)
           investing activities                          10,409     (170,581)

    CASH FLOWS FROM FINANCING ACTIVITIES:
     Cash dividends paid                                 (7,281)      (6,015)
     Proceeds from revolving credit facility            100,600            -
     Payments on revolving credit facility             (105,975)           -
     Proceeds from issuance of common stock               1,181        5,622
     Purchase of treasury stock                            (156)     (43,965)
     Other financing activities                          (1,320)       1,120

          Net cash used in financing activities         (12,951)     (43,238)

     Effect of exchange rate changes                     (3,263)       7,716

    INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS     79,802      (94,434)
     Balance at beginning of period                      39,446      179,694
     Balance at end of period                          $119,248      $85,260

SOURCE Men's Wearhouse