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Men's Wearhouse Reports Fiscal 2009 Fourth Quarter and Full Year Results

- Q4 2009 GAAP diluted loss per share was $0.36 including a $0.25 per diluted share non-cash asset impairment charge resulting in Q4 2009 adjusted loss per share of $0.11

- Fiscal 2009 GAAP diluted earnings per share were $0.86 and adjusted diluted earnings per share were $1.11

- Company provides guidance for first quarter of fiscal 2010

- Conference call at 5:00 pm Eastern today

HOUSTON, March 10 /PRNewswire-FirstCall/ -- The Men's Wearhouse (NYSE: MW) today announced its consolidated financial results for the fourth quarter ended January 30, 2010.

    
    
                   Fourth Quarter Sales Summary – Fiscal 2009
                   ------------------------------------------
                                                     
                                                     Comparable Store Sales
               U.S. dollars, in millions   Total            Change %
               -------------------------   Sales    -----------------------
                Current Year  Prior Year  Change %  Current Year  Prior Year
                ------------  ----------            ------------  ----------
    Total
     Company        $457.2     $476.4     -4.0%
    --------        ------     ------     ----
       MW           $294.3(a)  $315.8(a)  -6.8%       -7.1%(b)     -9.7%(b)
       --           ------     ------     ----        ----         ----
       K&G           $92.7      $98.6     -6.0%       -5.0%       -10.7%
       ---           -----      -----     ----        ----        -----
         United
          States    $395.5     $424.5     -6.8%       -6.6%        -9.9%
         -------    ------     ------     ----        ----         ----
       Moores        $61.7      $51.9     19.1%        1.9%(c)    -10.5%(c)
       ------        -----      -----     ----         ---        -----
    
    
    
                    Year-To-Date Sales Summary – Fiscal 2009
                    ----------------------------------------
                                                     
                                                      Comparable Store Sales
               U.S. dollars, in millions    Total            Change %
               -------------------------    Sales     -----------------------
               Current Year    Prior Year   Change %  Current Year  Prior Year
               ------------    ----------             ------------  ----------
    Total
     Company      $1,909.6      $1,972.4     -3.2%
    --------      --------      --------     ----
       MW         $1,281.8(a)   $1,322.0(a)  -3.0%       -4.0%(b)   -9.0%(b)
       --         --------      --------     ----        ----       ----
       K&G          $370.1        $376.0     -1.6%       -1.9%     -11.7%
       ---          ------        ------     ----        ----      -----
         United
          States  $1,687.5      $1,742.2     -3.1%       -3.5%      -9.6%
         -------  --------      --------     ----        ----       ----
       Moores       $222.1        $230.2     -3.6%       -0.9%(c)   -5.6%(c)
       ------       ------        ------     ----        ----       ----
    
    (a)  Includes retail stores and ecommerce.
    (b)  Comparable store sales do not include ecommerce.  Stores from the
         After Hours acquisition are included beginning Q2 of fiscal 2008.
    (c)  Comparable store sales change is based on the Canadian dollar.

Diluted loss per share was $0.36 for the fourth quarter ended January 30, 2010.  Adjusted loss per share was $0.11.  This excludes a $13.1 million (net of tax) or $0.25 per diluted share non-cash asset impairment charge.  This compares to diluted loss per share guidance given December 8, 2009 of $0.15 to $0.19.  Prior year fourth quarter GAAP diluted earnings per share were $0.03 and adjusted loss per share was $0.06 excluding $5.8 million (net of tax) or $0.11 per diluted share gain from an asset sale and $1.2 million (net of tax) or $0.02 per diluted share for a non-cash asset impairment charge.

Diluted earnings per share were $0.86 for fiscal year 2009.  Adjusted diluted earnings per share were $1.11.  This excludes a $13.1 million (net of tax) or $0.25 per diluted share non-cash asset impairment charge.  

FOURTH Quarter REVIEW

    --  Total Company sales decreased 4.0% for the quarter.
        o Clothing product sales, representing 85.3% of fiscal fourth quarter
          2009 total net sales, decreased 4.1% due to decreases in the Company's
          comparable store sales primarily driven by a reduction in store
          traffic levels and a lower domestic average ticket.
        o Tuxedo rental sales, representing 7.7% of fiscal fourth quarter 2009
          total net sales, decreased 1.2%.
    --  Gross margin before occupancy costs, as a percentage of total net sales,
        decreased 105 basis points from 53.7% to 52.7%. Clothing product
        margins, as a percentage of related sales, decreased 127 basis points
        primarily due to increased promotional activities.
    --  Occupancy costs increased, as a percentage of total net sales, by 35
        basis points from 15.3% to 15.7%. On an absolute dollar basis, occupancy
        costs decreased 1.9% from $73.0 million in the prior year to $71.6
        million.
    --  In the fourth quarter, the Company incurred a pretax non-cash asset
        impairment charge related to 157 stores (145 Men's Wearhouse and Tux
        stores and 12 K&G stores) in the amount of $19.5 million. Selling,
        general, and administrative expenses, excluding this charge, were $184.3
        million in the current year and decreased 4.3% from the prior year's
        adjusted SG&A of $192.6 million which excludes an $8.8 million pretax
        gain from an asset sale and a $1.8 million pretax non-cash asset
        impairment charge. As a percentage of total net sales, adjusted SG&A
        decreased 10 basis points from 40.4% to 40.3%. Adjusted SG&A excluding
        advertising decreased 3.8% from the adjusted prior year quarter.
    --  Operating loss excluding the $19.5 million pretax non-cash asset
        impairment charge was $15.1 million or negative 3.3% of total net sales
        compared to adjusted operating loss of $9.6 million or negative 2.0% of
        total net sales for the same period last year, which excludes an $8.8
        million pretax gain from an asset sale and a $1.8 million pretax
        non-cash asset impairment charge.
    --  Cash and cash equivalent balances as of the end of the fourth quarter of
        2009 were $186.0 million, an increase of $81.5 million over the cash and
        cash equivalent balances plus amounts held in short-term investments as
        of the same period last year.
    --  Total inventories as of the end of the fourth quarter of 2009 were
        $431.5 million, a decrease of 2.0% from the prior year same period of
        $440.1 million.
    --  Long term debt as of the end of the fourth quarter of 2009 was $43.5
        million, a decrease of $19.4 million from the same period last year.
    --  Fiscal 2009 total capital expenditures were $56.9 million, which
        consisted of $29.9 million for new stores, store remodels and store
        relocations and $27.0 million related to information technology and
        distribution centers and other corporate projects.
    --  During fiscal 2009, the Company opened 5 new Men's Wearhouse stores and
        1 Men's Wearhouse and Tux store and closed 4 Men's Wearhouse stores, 1
        K&G store, and 36 Men's Wearhouse and Tux stores.


FIRST QUARTER 2010 GUIDANCE

    --  For the first quarter of the fiscal year, the Company expects GAAP
        diluted earnings per share in a range of $0.12 to $0.16.
    --  The Company anticipates comparable store sales at its MW stores to be
        flat to a decline in the low single digit range, at K&G a decrease in
        the low single digit range and at Moores a flat to low single digit
        decrease. Included in this outlook is a low single digit increase in
        tuxedo rental revenues.
    --  Total gross profit for the first quarter is expected to increase in the
        low single digit range from the prior year. Occupancy costs are expected
        to decrease in a low single digit range in absolute dollar terms.
        Selling, general and administrative expenses are expected to increase in
        the low single digit range from the prior year.
    --  This guidance includes an estimated effective tax rate of 35.2% for the
        first quarter.
    --  Fully diluted shares outstanding of 52.5 million are estimated for the
        first quarter.
    --  Capital expenditures for the full year are targeted in a range of $55
        million to $60 million and depreciation and amortization is estimated at
        $75 million.


UPDATED CONFERENCE CALL AND WEBCAST INFORMATION

At 5:00 pm Eastern time on Wednesday, March 10, 2010, company management will host a conference call and real time web cast to review the fiscal fourth quarter and full year 2009 and provide its outlook for first quarter 2010.

To access the conference call, dial 480-629-9867. To access the live webcast presentation, visit the Investor Relations section of the Company's website at www.menswearhouse.com.  A telephonic replay will be available through March 17, 2010 by calling 303-590-3030 and entering the access code of 4248288#, or a webcast archive will be available free on the website for approximately 90 days.

    
    
    STORE INFORMATION
    
                               January 30, 2010       January 31, 2009
                               ----------------       ----------------
                            Number of      Sq. Ft.   Number of    Sq. Ft.
                              Stores       (000's)     Stores     (000's)
                            ----------     -------   ----------   -------
    
    Men's Wearhouse             581       3,284.4        580     3,263.1
    ---------------             ---       -------        ---     -------
    
    Men's Wearhouse and Tux     454         623.4        489       665.0
    -----------------------     ---         -----        ---       -----
    
    Moores, Clothing for Men    117         734.6        117       729.3
    ------------------------    ---         -----        ---       -----
    
    K&G (a)                     107       2,475.6        108     2,493.4
    ------                      ---       -------        ---     -------
    
    Total                     1,259       7,118.0      1,294     7,150.8
    
    (a)  94 and 93 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 1,259 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 Men's Wearhouse and Tux stores carry a limited selection.  Tuxedo rentals are available in the Men's Wearhouse, Moores and Men's Wearhouse and Tux stores.  The Company operates websites at www.menswearhouse.com, www.mooresclothingformen.com and www.kgstores.com.

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 January 31, 2009 and subsequent Forms 10-Q.

For additional information on Men's Wearhouse, please visit the Company's website at www.menswearhouse.com.


CONTACT: Neill Davis, EVP & CFO, Men's Wearhouse (281) 776-7000

         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
                January 30, 2010 AND January 31, 2009
                (In thousands, except per share data)
    
                                        Three Months Ended
                                        ------------------
                                          % of                  % of
                                 2009    Sales         2008    Sales
                                 ----    -----         ----    -----
    
    Net sales:
      Clothing product       $390,140      85.33%  $406,690      85.37%
      Tuxedo rental
       services                35,380       7.74%    35,806       7.52%
      Alteration and other
       services                31,698       6.93%    33,864       7.11%
                               ------       ----     ------       ----
        Total net sales       457,218     100.00%   476,360     100.00%
    
    Total cost of sales       287,943      62.98%   293,370      61.59%
                              -------      -----    -------      -----
    
    Gross margin (a)          169,275      37.02%   182,990      38.41%
    
    Selling, general and
     administrative
     expenses                 203,818      44.58%   185,550      38.95%
                              -------      -----    -------      -----
    
    Operating loss            (34,543)    (7.56%)    (2,560)    (0.54%)
    
    Net interest                 (153)    (0.03%)      (350)    (0.07%)
                                 ----    -------       ----    -------
    
    Loss before income
     taxes                    (34,696)    (7.59%)    (2,910)    (0.61%)
    
    Benefit for income
     taxes                    (15,778)    (3.45%)    (4,399)    (0.92%)
                              -------     ------     ------     ------
    
    Net earnings (loss)      $(18,918)    (4.14%)    $1,489       0.31%
                             ========     ======     ======       ====
    
    
    Net earnings (loss) per
     diluted common share      $(0.36)                $0.03
                               ======                 =====
    
    Weighted average
     diluted common
     shares outstanding:       52,297                52,037
                               ======                ======
    
    (a)  Gross margin as a percentage of related sales:
    
                                       Three Months Ended
                                       ------------------
                                          % of                  % of
                                         Related               Related
                               2009       Sales      2008       Sales
                               ----      -------     ----      -------
    Clothing margin          $204,967      52.54%  $218,819      53.80%
    Tuxedo margin              27,967      79.05%    25,860      72.22%
    Alteration and other
     services margin            7,985      25.19%    11,307      33.39%
    Occupancy costs           (71,644)    (15.67%)  (72,996)    (15.32%)
                              -------     ------    -------     ------
    Gross margin             $169,275      37.02%  $182,990      38.41%
                             ========      =====   ========      =====
    
    
    
                                                        Variance
                                                        --------
                                                                     Basis
                                             Dollar          %       Points
                                             ------         ---      ------
    
    Net sales:
      Clothing product                      $(16,550)      (4.07%)     0.05
      Tuxedo rental services                    (426)      (1.19%)     0.22
      Alteration and other services           (2,166)      (6.40%)    (0.18)
                                              ------       ------     -----
        Total net sales                      (19,142)      (4.02%)     0.00
    
    Total cost of sales                       (5,427)      (1.85%)     1.39
                                              ------       ------      ----
    
    Gross margin (a)                         (13,715)      (7.49%)    (1.39)
    
    Selling, general and
     administrative expenses                  18,268        9.85%      5.63
                                              ------        ----       ----
    
    Operating loss                           (31,983)  (1,249.34%)    (7.02)
    
    Net interest                                 197       56.29%      0.04
                                                 ---       -----       ----
    
    Loss before income taxes                 (31,786)  (1,092.30%)    (6.98)
    
    Benefit for income taxes                 (11,379)    (258.67%)    (2.53)
                                             -------    ---------     -----
    
    Net earnings (loss)                     $(20,407)  (1,370.52%)    (4.45)
                                            ========  ===========     =====
    
    
    Net earnings (loss) per diluted
     common share
    
    
    Weighted average diluted common
     shares outstanding:
    
    
    (a)  Gross margin as a percentage of related sales:
    
                                                       Variance
                                                       --------
                                                                     Basis
                                             Dollar          %       Points
                                             ------         ---      ------
    Clothing margin                         $(13,852)       (6.33%)   (1.27)
    Tuxedo margin                              2,107         8.15%     6.82
    Alteration and other services
     margin                                   (3,322)      (29.38%)   (8.20)
    Occupancy costs                            1,352         1.85%    (0.35)
                                               -----         ----     -----
    Gross margin                            $(13,715)       (7.49%)   (1.39)
                                            ========      =======     =====
    
    
    
                  THE MEN'S WEARHOUSE, INC. AND SUBSIDIARIES
                CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
                                (Unaudited)
    
                          FOR THE TWELVE MONTHS ENDED
                      January 30, 2010 AND January 31, 2009
                      (In thousands, except per share data)
    
                                          Twelve Months Ended
                                          -------------------
                                             % of                     % of
                                 2009        Sales        2008         Sales
                                 ----        -----        ----         -----
    
    Net sales:
      Clothing product       $1,447,386      75.80%    $1,515,704     76.84%
      Tuxedo rental
       services                 334,068      17.49%       329,951     16.73%
      Alteration and
       other services           128,121       6.71%       126,763      6.43%
                                -------       ----        -------      ----
        Total net
         sales                1,909,575     100.00%     1,972,418    100.00%
    
    Total cost of
     sales                    1,111,849      58.22%     1,121,906     56.88%
                              ---------      -----      ---------     -----
    
    Gross margin (a)            797,726      41.78%       850,512     43.12%
    
    Selling, general
     and administrative
     expenses                   729,522      38.20%       760,041     38.53%
                                -------      -----        -------     -----
    
    Operating income             68,204       3.57%        90,471      4.59%
    
    Net interest                   (332)     (0.02%)       (1,708)    (0.09%)
                                   ----     -------        ------     ------
    
    Earnings before
     income taxes                67,872       3.55%        88,763      4.50%
    
    Provision for
     income taxes                22,364       1.17%        29,919      1.52%
                                 ------       ----         ------      ----
    
    Net earnings                $45,508       2.38%       $58,844      2.98%
                                =======       ====        =======      ====
    
    
    Net earnings
     per diluted
     common share (b)             $0.86                     $1.13
                                  =====                     =====
    
    Weighted average
     diluted common
     shares outstanding:         52,280                    51,944
                                 ======                    ======
    
    
    (a)  Gross margin as a percentage of related sales:
    
                                              Twelve Months Ended
                                              -------------------
                                            % of                     % of
                                           Related                  Related
                                2009        Sales         2008       Sales
                                ----      --------        ----      --------
    Clothing margin            $777,215      53.70%      $843,075     55.62%
    Tuxedo margin               276,651      82.81%       270,436     81.96%
    Alteration and other
     services margin             33,532      26.17%        30,598     24.14%
    Occupancy costs            (289,672)    (15.17%)     (293,597)   (14.89%)
                               --------     ------       --------    ------
    Gross margin               $797,726      41.78%      $850,512     43.12%
                               ========      =====       ========     =====
    
    (b)  Calculated based on net earnings less net earnings allocated to
         participating securities for the twelve months ended January 30,
         2010.
    
    
    
                                              Variance
                                              --------
                                                        Basis
                                  Dollar         %      Points
                                  ------        ---     ------
    
    Net sales:
      Clothing product            $(68,318)     (4.51%)   (1.05)
      Tuxedo rental services         4,117       1.25%     0.77
      Alteration and other
       services                      1,358       1.07%     0.28
                                     -----       ----      ----
        Total net sales            (62,843)     (3.19%)    0.00
    
    Total cost of sales            (10,057)     (0.90%)    1.35
                                   -------      ------     ----
    
    Gross margin (a)               (52,786)     (6.21%)   (1.35)
    
    Selling, general and
     administrative expenses       (30,519)     (4.02%)   (0.33)
                                   -------      ------    -----
    
    Operating income               (22,267)    (24.61%)   (1.02)
    
    Net interest                     1,376       80.56%    0.07
                                     -----       -----     ----
    
    Earnings before income taxes   (20,891)    (23.54%)   (0.95)
    
    Provision for income taxes      (7,555)    (25.25%)   (0.35)
                                    ------     -------    -----
    
    Net earnings                  $(13,336)    (22.66%)   (0.60)
                                  ========     =======    =====
    
    Net earnings per diluted
     common share (b)
    
    
    Weighted average diluted
     common shares outstanding:
    
    
    (a)  Gross margin as a percentage of related sales:
    
                                            Variance
                                            --------
                                                        Basis
                                  Dollar         %      Points
                                  ------        ---     ------
    Clothing margin               $(65,860)     (7.81%)   (1.92)
    Tuxedo margin                    6,215        2.30%    0.85
    Alteration and other
     services margin                 2,934        9.59%    2.03
    Occupancy costs                  3,925        1.34%   (0.28)
                                     -----        ----    -----
    Gross margin                  $(52,786)     (6.21%)   (1.35)
                                  ========      ======    =====
    
    
    (b)  Calculated based on net earnings less net earnings allocated to
         participating securities for the twelve months ended January 30,
         2010.
    
    
    
               THE MEN'S WEARHOUSE, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED BALANCE SHEETS
                              (In thousands)
                               (Unaudited)
    
                                                 January 30,       January 31,
                                                    2010              2009
                                                    ----              ----
                      ASSETS
                      ------
    Current assets:
      Cash and cash equivalents                    $186,018           $87,412
      Short-term investments                              -            17,121
      Accounts receivable, net                       16,745            16,315
      Inventories                                   431,492           440,099
      Other current assets                           74,075            70,668
                                                     ------            ------
    
         Total current assets                       708,330           631,615
    Property and equipment, net                     344,746           387,472
    Tuxedo rental product, net                      102,479            96,691
    Goodwill                                         59,414            57,561
    Other assets, net                                17,137            14,391
                                                     ------            ------
    
         Total assets                            $1,232,106        $1,187,730
                                                 ==========        ==========
    
    LIABILITIES AND SHAREHOLDERS' EQUITY
    ------------------------------------
    
    Current liabilities:
      Accounts payable                              $83,052          $108,800
      Accrued expenses and other current
       liabilities                                  117,047           111,404
      Income taxes payable                           23,936                19
                                                     ------               ---
    
         Total current liabilities                  224,035           220,223
    Long-term debt                                   43,491            62,916
    Deferred taxes and other liabilities             62,236            62,443
                                                     ------            ------
    
         Total liabilities                          329,762           345,582
                                                    -------           -------
    
    Shareholders' equity:
      Preferred stock                                     -                 -
      Common stock                                      705               700
      Capital in excess of par                      327,742           315,404
      Retained earnings                             953,986           924,288
      Accumulated other comprehensive income         32,537            14,292
                                                     ------            ------
          Total                                   1,314,970         1,254,684
    
      Treasury stock, at cost                      (412,626)         (412,536)
                                                   --------          --------
    
          Total shareholders' equity                902,344           842,148
                                                    -------           -------
    
         Total liabilities and equity            $1,232,106        $1,187,730
                                                 ==========        ==========
    
    
    
               THE MEN'S WEARHOUSE, INC. AND SUBSIDIARIES
            CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                             (Unaudited)
    
                       FOR THE TWELVE MONTHS ENDED
                  January 30, 2010 AND January 31, 2009
                             (In thousands)
    
                                                    Twelve Months Ended
                                                    -------------------
                                                  2009                2008
                                                  ----                ----
    
    CASH FLOWS FROM OPERATING ACTIVITIES:
      Net earnings                               $45,508             $58,844
      Non-cash adjustments to net earnings:
         Depreciation and amortization            86,090              90,665
         Tuxedo rental product
          amortization                            37,184              38,180
         Asset impairment charges                 19,473               1,812
         Other                                   (16,379)             10,130
      Changes in assets and
       liabilities                                (8,721)            (70,141)
                                                  ------             -------
    
              Net cash provided by
               operating activities              163,155             129,490
                                                 -------             -------
    
    CASH FLOWS FROM INVESTING ACTIVITIES:
      Capital expenditures                       (56,912)            (88,225)
      Proceeds from sale of
       distribution facility                           -               9,588
      Purchases of available-for-
       sale investments                                -             (17,121)
      Proceeds from sales of
       available-for-sale
       investments                                19,410              59,921
      Other investing activities                     797                 811
                                                     ---                 ---
    
              Net cash used in investing
               activities                        (36,705)            (35,026)
                                                 -------             -------
    
    CASH FLOWS FROM FINANCING ACTIVITIES:
      Proceeds from issuance of
       common stock                                4,106               2,853
      Proceeds from revolving
       credit facility                                 -             150,600
      Payments on revolving credit
       facility                                  (25,000)           (130,975)
      Payments on Canadian term
       loan                                            -             (31,880)
      Cash dividends paid                        (14,722)            (14,600)
      Purchase of treasury stock                     (90)               (156)
      Other financing activities                  (1,242)             (1,261)
                                                  ------              ------
    
              Net cash used in financing
               activities                        (36,948)            (25,419)
                                                 -------             -------
    
      Effect of exchange rate
       changes                                     9,104             (21,079)
                                                   -----             -------
    
    INCREASE IN CASH AND CASH
     EQUIVALENTS                                  98,606              47,966
      Balance at beginning of
       period                                     87,412              39,446
                                                  ------              ------
      Balance at end of period                  $186,018             $87,412
                                                ========             =======
    
    

SOURCE Men's Wearhouse