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Men's Wearhouse Reports Fiscal 2007 Third Quarter Results

- Q3 2007 GAAP diluted EPS was $0.69 versus $0.58 in 2006

- Company estimates Q4 2007 GAAP diluted EPS in a range of $0.43 to $0.48

- Company estimates Fiscal 2007 GAAP diluted EPS in a range of $2.87 to $2.92

- Conference call at 5:00 pm eastern today

HOUSTON, Nov. 28 /PRNewswire-FirstCall/ -- The Men's Wearhouse (NYSE: MW) today announced its consolidated financial results for the third quarter ended November 3, 2007.



    THIRD QUARTER RESULTS

                    Third Quarter Sales Summary - Fiscal 2007

                     U.S. dollars, in     Total Sales   Comparable Store Sales
                         millions          Change %          Change %
                 Current Year  Prior Year            Current Year   Prior Year

    Total Company      $512.1     $430.1     +19.1%
      MW               $292.9(a)  $280.3(a)  +4.5%       +0.6%       +4.3%
      After Hours       $61.2       (b)        (b)         (b)         (b)
      K&G               $87.7      $89.9     -2.5%      -11.3%       +0.2%
        United States  $451.7     $376.8     +19.9%     -2.1%        +3.4%
      Moores            $60.5      $53.3     +13.5%     +0.6%(c)    +13.0%(c)


                   Year-To-Date Sales Summary - Fiscal 2007

                         U.S. dollars, in  Total Sales  Comparable Store Sales
                             millions         Change %         Change %
                        Current     Prior                 Current    Prior
                         Year       Year                   Year       Year
    Total Company      $1,577.6    $1,325.2    +19.0 %
      MW                 $895.8(a)   $859.5(a)  +4.2 %    +1.5 %     +4.3%
      After Hours        $177.3        (b)       (b)       (b)         (b)
      K&G                $298.8      $288.2     +3.7%     -8.0%      +0.0%
        United States  $1,399.0    $1,166.8    +19.9%     -0.8%      +3.3%
      Moores             $178.6      $158.5    +12.7%     +5.1%(c)   +8.3%(c)

    (a)  Includes retail stores and ecommerce.
    (b)  After Hours was acquired on April 9, 2007 and will be excluded from
         comparable store sales reporting until Q2 of fiscal 2008.
    (c)  Comparable store sales change is based on the Canadian dollar.


Third quarter 2007 operating income was $59.2 million compared to $48.8 million last year and net income was $37.1 million compared to $31.8 million last year. GAAP diluted earnings per share were $0.69 for the third quarter ended November 3, 2007 compared to $0.58 last year. After Hours, after acquisition funding costs, contributed $0.05 to the GAAP diluted earnings per share for the third quarter.

Year-to-date fiscal 2007 operating income was $207.1 million compared to $150.8 million last year and net income was $132.2 million compared to $96.3 million last year. GAAP diluted earnings per share were $2.44 for the year-to-date period ended November 3, 2007 compared to $1.76 last year. After Hours, after acquisition funding costs, contributed $0.37 to the GAAP diluted earnings per share for the year-to-date period ended November 3, 2007.

    THIRD Quarter Highlights
    --  Total company sales increased 19.1% for the quarter.  Apparel sales,
        representing 75.0% of total sales, increased 4.8%.  Tuxedo rental
        revenues, representing 18.8% of total sales, increased 178.6%.
        Tuxedo rental revenues excluding After Hours increased 13.6%.

          -- Comparable store sales decreased 2.1% for the Company's United
             States based stores, below the Company's guidance of flat to +1%.
             This under plan performance was primarily related to weaker
             traffic trends and lower average ticket realized at the Company's
             K&G group of stores.

          -- Comparable store sales increased 0.6% for the Company's Canadian
             based stores, below the Company's guidance of +2% to +4%.

          -- Unseasonably warmer weather conditions impacted the company's
             outwear clothing categories thereby contributing to the company's
             under plan comparable store sales.

    --  Gross margin, as a percentage of sales, increased 385 basis points
        from 43.10% to 46.95%.  This improvement is due to both organic and
        acquired growth in tuxedo rental revenues as well as continued gains
        in merchandise margins.

    --  Selling, general, and administrative expenses as a percentage of sales
        increased 364 basis points from 31.76% to 35.40%.  This increase is
        primarily due to the inclusion of the operations of After Hours.

    --  Operating income, as a percentage of sales, increased 21 basis points
        from 11.34% to 11.55%.

    --  The effective tax rate for the quarter of 37.4% was inline with the
        Company's guidance.

    --  During the quarter the Company repurchased 818,000 shares for a total
        of $34.1 million.

FOURTH QUARTER 2007 GUIDANCE AND UPDATED FISCAL 2007 OUTLOOK

For the fourth quarter of 2007, the Company expects same store sales growth in the U.S. to be in the negative low single digit range and in Canada to be in a range of flat to +2%. GAAP diluted earnings per share are expected to be in the range of $0.43 to $0.48.

After Hours revenues for the fourth quarter are estimated in a range of $24 million to $26 million. After consideration of acquisition funding costs, After Hours is expected to be dilutive to fiscal fourth quarter 2007 in a range of $0.31 to $0.32 per diluted share outstanding. It should be noted that the seasonality of After Hours revenues is heavily concentrated in April, May and June. Second quarter, followed by third quarter, is the highest revenue quarter for After Hours and first and fourth quarters are considered off season. As a result, After Hours typically has income in the second and third quarters and losses in the first and fourth quarters.

For the fiscal year ending February 2, 2008, the Company expects GAAP diluted earnings per share in a range of $2.87 to $2.92. Same store sales changes in the U.S. for fiscal 2007 are expected to be a decrease of 1% to flat and in Canada are expected to be in a range of +2% to +4%.

After Hours revenues for fiscal 2007 are estimated in a range of $201 million to $203 million. After consideration of acquisition funding costs, After Hours is expected to be accretive to fiscal 2007 in a range of $0.05 to $0.06 per diluted share outstanding.

For the fourth quarter, the guidance includes an estimated effective tax rate of approximately 37.3% and fully diluted shares outstanding of 53.3 million. For the full year, the estimated effective tax rate is 36.6% and the fully diluted shares outstanding are estimated to be 54.0 million.

CONFERENCE CALL AND WEBCAST INFORMATION

At 5:00 p.m. Eastern time today, company management will host a conference call and real time web cast to review the results for the fiscal third quarter 2007 and provide an outlook for fiscal fourth quarter and an update for fiscal 2007.

To access the conference call, dial 303-262-2125. 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 December 5, 2007 and by calling 303-590-3000 and entering the access code of 11099472#, or a webcast archive will be available free on the website for approximately 90 days.


    STORE INFORMATION

                    November 3, 2007  October 28, 2006   February 3, 2007

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

    Men's Wearhouse     560   3,132.3    538     2,979.9    543   3,014.8

    After Hours         493     654.8    (a)       (a)      (a)      (a)

    Moores, Clothing
     for Men            116     717.8    116       719.1    116     722.7

    K&G (b)             103   2,392.4     89     2,112.2     93   2,201.6

    Total             1,272   6,897.3    743     5,811.2    752   5,939.1

    (a)  After Hours was acquired on April 9, 2007.
    (b)  83, 68 and 73 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 1,272 stores. The stores carry a full selection of designer, brand name and private label suits, sport coats, furnishings and accessories, including tuxedo rentals available in the Men's Wearhouse, Moores, After Hours, and select K&G 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 unfavorable local, regional and national economic developments, disruption in retail buying trends due to homeland security concerns, severe weather conditions, aggressive advertising or marketing activities of competitors, governmental actions and other factors described herein and in the Company's annual report on Form 10-K for the year ended February 3, 2007 and subsequent Forms 10-Q.

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
                    November 3, 2007 AND October 28, 2006
                    (In thousands, except per share data)

                                            Three Months Ended
                                             % of                   % of
                                    2007     Sales       2006       Sales


    Net sales                     $512,136   100.00%   $430,068   100.00%
    Cost of goods sold,
     including buying,
     distribution and
     occupancy costs               271,665    53.05%    244,690    56.90%
          Gross margin             240,471    46.95%    185,378    43.10%

    Selling, general and
     administrative expenses       181,307    35.40%    136,610    31.76%

    Operating income                59,164    11.55%     48,768    11.34%

    Interest income                 (1,352)   (0.26%)    (2,461)   (0.57%)
    Interest expense                 1,304     0.25%      2,346     0.55%

    Earnings before income taxes    59,212    11.56%     48,883    11.37%

    Provision for income taxes      22,145     4.32%     17,109     3.98%

    Net earnings                   $37,067     7.24%    $31,774     7.39%


    Net earnings per share:
        Basic                        $0.70                $0.60
        Diluted                      $0.69                $0.58

    Weighted average common shares
     outstanding:
        Basic                       53,141               53,098
        Diluted                     53,775               54,903



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

                          FOR THE NINE MONTHS ENDED
                    November 3, 2007 AND October 28, 2006
                    (In thousands, except per share data)

                                              Nine Months Ended
                                               % of                  % of
                                     2007      Sales       2006     Sales


    Net sales                    $1,577,600   100.00%  $1,325,219   100.00%
    Cost of goods sold,
     including buying,
     distribution and
     occupancy costs                836,358    53.01%     757,889    57.19%

          Gross margin              741,242    46.99%     567,330    42.81%

    Selling, general and
     administrative expenses        534,139    33.86%     416,580    31.43%

    Operating income                207,103    13.13%     150,750    11.38%

    Interest income                  (4,655)   (0.30%)     (7,249)   (0.55%)
    Interest expense                  3,513     0.22%       6,826     0.52%

    Earnings before income taxes    208,245    13.20%     151,173    11.41%

    Provision for income taxes       76,019     4.82%      54,922     4.14%

    Net earnings                   $132,226     8.38%     $96,251     7.26%


    Net earnings per share:
        Basic                         $2.47                 $1.81
        Diluted                       $2.44                 $1.76

    Weighted average common shares
     outstanding:
        Basic                        53,614                53,163
        Diluted                      54,284                54,715



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

                                                 November 3,       October 28,
                                                    2007              2006
                    ASSETS

    Current assets:
      Cash and cash equivalents                   $102,531           $75,093
      Short-term investments                            --           180,275
      Inventories                                  515,917           481,885
      Other current assets                          93,335            53,835

         Total current assets                      711,783           791,088
    Property and equipment, net                    392,917           277,510
    Goodwill                                        73,674            58,261
    Other assets, net                               94,324            71,586

         Total assets                           $1,272,698        $1,198,445

    LIABILITIES AND SHAREHOLDERS' EQUITY

    Current liabilities                           $274,182          $218,495
    Long-term debt                                  92,595           207,310
    Deferred taxes and other liabilities            68,294            49,216
    Shareholders' equity                           837,627           723,424

         Total liabilities and equity           $1,272,698        $1,198,445



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

                          FOR THE NINE MONTHS ENDED
                      November 3, 2007 AND October 28, 2006
                                  (In thousands)

                                                        Nine Months Ended
                                                     2007             2006

    CASH FLOWS FROM OPERATING ACTIVITIES:
      Net earnings                                 $132,226          $96,251
      Non-cash adjustments to net earnings:
         Depreciation and amortization               57,293           45,191
         Tuxedo rental product amortization          36,976           14,627
         Other                                        7,987            2,771
      Changes in assets and liabilities             (91,398)        (108,027)

          Net cash provided by operating
           activities                               143,084           50,813

    CASH FLOWS FROM INVESTING ACTIVITIES:
      Capital expenditures                          (90,394)         (47,552)
      Net non-cash assets acquired                  (68,253)              --
      Purchases of available-for-sale investments  (277,480)        (197,920)
      Proceeds from sales of available-for-sale
       investments                                  277,480           80,420
      Other                                             (91)            (913)

          Net cash used in investing
           activities                              (158,738)        (165,965)

    CASH FLOWS FROM FINANCING ACTIVITIES:
      Cash dividends paid                            (9,186)          (8,072)
      Proceeds from issuance of common stock          6,323            7,583
      Purchase of treasury stock                    (78,080)         (11,512)
      Other                                           1,195            1,161

          Net cash used in financing activities     (79,748)         (10,840)

      Effect of exchange rate changes                18,239              859

    DECREASE IN CASH AND CASH EQUIVALENTS           (77,163)        (125,133)
      Balance at beginning of period                179,694          200,226
      Balance at end of period                     $102,531          $75,093

SOURCE The Men's Wearhouse, Inc.