Quarterly report pursuant to Section 13 or 15(d)

Condensed Consolidating Information

v3.19.2
Condensed Consolidating Information
6 Months Ended
Aug. 03, 2019
CONDENSED CONSOLIDATING FINANCIAL INFORMATION  
Condensed Consolidating Information

18. Condensed Consolidating Information

As discussed in Note 4, The Men's Wearhouse (the "Issuer") issued $600.0 million in aggregate principal amount of Senior Notes. The Senior Notes are guaranteed jointly and severally, on an unsecured basis by Tailored Brands, Inc. (the "Parent") and certain of our U.S. subsidiaries (the "Guarantors"). Our foreign subsidiaries (collectively, the "Non-Guarantors") are not guarantors of the Senior Notes. Each of the Guarantors is 100% owned and all guarantees are joint and several.  In addition, the guarantees are full and unconditional except for certain automatic release provisions related to the Guarantors.

These automatic release provisions are considered customary and include the sale or other disposition of all or substantially all of the assets or all of the capital stock of any subsidiary guarantor, the release or discharge of a guarantor's guarantee of the obligations under the Term Loan other than a release or discharge through payment thereon, the designation in accordance with the Indenture of a guarantor as an unrestricted subsidiary or the satisfaction of the requirements for defeasance or discharge of the Senior Notes as provided for in the Indenture.

The tables in the following pages present the condensed consolidating financial information for the Parent, the Issuer, the Guarantors and the Non-Guarantors, together with eliminations, as of and for the periods indicated.  The consolidating financial information may not necessarily be indicative of the financial positions, results of operations or cash flows had the Issuer, Guarantors and Non-Guarantors operated as independent entities.

Tailored Brands, Inc.

Condensed Consolidating Balance Sheet

August 3, 2019

(in thousands)

Tailored

The Men’s

Guarantor

Non-Guarantor

    

    

    

Brands, Inc.

    

Wearhouse, Inc.

    

Subsidiaries

    

Subsidiaries

    

Eliminations

    

Consolidated

 

ASSETS

CURRENT ASSETS:

Cash and cash equivalents

$

$

1,158

$

2,091

$

16,227

$

$

19,476

Accounts receivable, net

23,397

174,552

74,042

(206,815)

65,176

Inventories

130,301

485,873

230,778

846,952

Other current assets

9,744

31,154

27,632

45,885

(50,533)

63,882

Total current assets

9,744

186,010

690,148

366,932

(257,348)

995,486

Property and equipment, net

185,823

201,464

33,901

421,188

Operating lease right-of-use assets

479,760

376,922

61,859

918,541

Rental product, net

80,973

7,225

10,887

99,085

Goodwill

6,160

52,128

20,995

79,283

Intangible assets, net

146,937

8,372

155,309

Investments in subsidiaries

177,425

1,157,995

(1,335,420)

Other assets

5,250

485

4,271

(4,200)

5,806

Total assets

$

187,169

$

2,101,971

$

1,475,309

$

507,217

$

(1,596,968)

$

2,674,698

LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES:

Accounts payable

$

165,067

$

79,695

$

59,303

$

90,696

$

(206,815)

$

187,946

Accrued expenses and other current liabilities

11,523

157,294

123,864

57,764

(50,533)

299,912

Current portion of operating lease liabilities

98,618

73,346

13,836

185,800

Current portion of long-term debt

9,000

9,000

Total current liabilities

176,590

344,607

256,513

162,296

(257,348)

682,658

Long-term debt, net

1,145,651

1,145,651

Operating lease liabilities

405,847

308,974

49,044

763,865

Deferred taxes, net and other liabilities

6,016

28,441

28,172

19,532

(4,200)

77,961

Shareholders' equity

4,563

177,425

881,650

276,345

(1,335,420)

4,563

Total liabilities and shareholders' equity

$

187,169

$

2,101,971

$

1,475,309

$

507,217

$

(1,596,968)

$

2,674,698

Tailored Brands, Inc.

Condensed Consolidating Balance Sheet

August 4, 2018

(in thousands)

Tailored

The Men’s

Guarantor

Non-Guarantor

    

    

    

Brands, Inc.

    

Wearhouse, Inc.

    

Subsidiaries

    

Subsidiaries

    

Eliminations

    

Consolidated

 

ASSETS

CURRENT ASSETS:

Cash and cash equivalents

$

$

2,086

$

2,215

$

63,914

$

$

68,215

Accounts receivable, net

25,994

321,918

50,882

(333,695)

65,099

Inventories

162,588

434,499

189,423

786,510

Other current assets

3,719

18,975

53,284

11,513

87,491

Total current assets

3,719

209,643

811,916

315,732

(333,695)

1,007,315

Property and equipment, net

191,503

201,939

33,665

427,107

Rental product, net

91,843

4,066

15,436

111,345

Goodwill

6,160

53,422

44,104

103,686

Intangible assets, net

154,580

11,301

165,881

Investments in subsidiaries

141,149

1,377,602

(1,518,751)

Other assets

12,290

655

81,087

(80,535)

13,497

Total assets

$

144,868

$

1,889,041

$

1,226,578

$

501,325

$

(1,932,981)

$

1,828,831

LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES:

Accounts payable

$

126,871

$

237,341

$

53,847

$

61,617

$

(333,695)

$

145,981

Accrued expenses and other current liabilities

13,049

146,213

124,928

35,788

319,978

Current portion of long-term debt

9,000

9,000

Total current liabilities

139,920

392,554

178,775

97,405

(333,695)

474,959

Long-term debt, net

1,207,377

1,207,377

Deferred taxes, net and other liabilities

4,937

147,961

47,365

26,756

(80,535)

146,484

Shareholders' equity

11

141,149

1,000,438

377,164

(1,518,751)

11

Total liabilities and shareholders' equity

$

144,868

$

1,889,041

$

1,226,578

$

501,325

$

(1,932,981)

$

1,828,831

Tailored Brands, Inc.

Condensed Consolidating Balance Sheet

February 2, 2019

(in thousands)

Tailored

The Men’s

Guarantor

Non-Guarantor

    

    

    

Brands, Inc.

    

Wearhouse, Inc.

    

Subsidiaries

    

Subsidiaries

    

Eliminations

    

Consolidated

 

ASSETS

CURRENT ASSETS:

Cash and cash equivalents

$

$

970

$

1,496

$

52,965

$

$

55,431

Accounts receivable, net

23,954

264,884

82,204

(297,969)

73,073

Inventories

149,923

461,153

219,350

830,426

Other current assets

30,699

37,969

7,314

(5,270)

70,712

Total current assets

205,546

765,502

361,833

(303,239)

1,029,642

Property and equipment, net

194,290

209,814

35,068

439,172

Rental product, net

81,809

3,426

14,535

99,770

Goodwill

6,160

52,128

21,203

79,491

Intangible assets, net

153,712

10,189

163,901

Investments in subsidiaries

160,057

1,234,005

(1,394,062)

Other assets

7,590

665

5,059

(4,800)

8,514

Total assets

$

160,057

$

1,729,400

$

1,185,247

$

447,887

$

(1,702,101)

$

1,820,490

LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES:

Accounts payable

$

142,701

$

201,799

$

69,485

$

112,963

$

(297,969)

$

228,979

Accrued expenses and other current liabilities

6,697

146,683

109,654

40,233

(5,270)

297,997

Current portion of long-term debt

11,619

11,619

Total current liabilities

149,398

360,101

179,139

153,196

(303,239)

538,595

Long-term debt, net

1,153,242

1,153,242

Deferred taxes, net and other liabilities

7,028

56,000

45,069

21,725

(4,800)

125,022

Shareholders' equity

3,631

160,057

961,039

272,966

(1,394,062)

3,631

Total liabilities and shareholders' equity

$

160,057

$

1,729,400

$

1,185,247

$

447,887

$

(1,702,101)

$

1,820,490

Tailored Brands, Inc.

Condensed Consolidating Statement of Earnings (Loss)

(in thousands)

Tailored

The Men’s

Guarantor

Non-Guarantor

    

    

    

Brands, Inc.

    

Wearhouse, Inc.

    

Subsidiaries

    

Subsidiaries

    

Eliminations

    

Consolidated

 

Three Months Ended August 3, 2019

Net sales

$

$

422,224

$

371,325

$

273,723

$

(277,784)

$

789,488

Cost of sales

220,362

288,849

224,334

(277,784)

455,761

Gross margin

201,862

82,476

49,389

333,727

Operating expenses

652

129,357

130,373

42,220

(29,465)

273,137

Operating (loss) income

(652)

72,505

(47,897)

7,169

29,465

60,590

Other income and expenses, net

28,318

1,147

(29,465)

Interest (expense) income, net

(1,084)

(18,097)

1,100

(20)

(18,101)

(Loss) earnings before income taxes

(1,736)

54,408

(18,479)

8,296

42,489

(Benefit) provision for income taxes

(321)

11,417

(4,254)

1,381

8,223

(Loss) earnings before equity in net income of subsidiaries

(1,415)

42,991

(14,225)

6,915

34,266

Equity in earnings (loss) of subsidiaries

35,681

(7,310)

(28,371)

Net earnings (loss)

$

34,266

$

35,681

$

(14,225)

$

6,915

$

(28,371)

$

34,266

Comprehensive income (loss)

$

14,872

$

22,838

$

(14,225)

$

364

$

(8,977)

$

14,872

Three Months Ended August 4, 2018

Net sales

$

$

443,685

$

386,319

$

164,525

$

(171,099)

$

823,430

Cost of sales

220,210

288,057

117,360

(171,099)

454,528

Gross margin

223,475

98,262

47,165

368,902

Operating expenses

1,083

132,573

132,681

29,064

(14,485)

280,916

Operating (loss) income

(1,083)

90,902

(34,419)

18,101

14,485

87,986

Other income and expenses, net

14,485

(14,485)

Interest (expense) income, net

(923)

(22,458)

2,131

508

(20,742)

Loss on extinguishment of debt, net

(8,122)

(8,122)

(Loss) earnings before income taxes

(2,006)

60,322

(17,803)

18,609

59,122

(Benefit) provision for income taxes

(461)

9,505

(2,557)

3,397

9,884

(Loss) earnings before equity in net income of subsidiaries

(1,545)

50,817

(15,246)

15,212

49,238

Equity in earnings (loss) of subsidiaries

50,783

(34)

(50,749)

Net earnings (loss)

$

49,238

$

50,783

$

(15,246)

$

15,212

$

(50,749)

$

49,238

Comprehensive income (loss)

$

42,583

$

50,681

$

(15,246)

$

8,659

$

(44,094)

$

42,583

Tailored

The Men’s

Guarantor

Non-Guarantor

    

Brands, Inc.

    

Wearhouse, Inc.

    

Subsidiaries

    

Subsidiaries

    

Eliminations

    

Consolidated

 

Six Months Ended August 3, 2019

Net sales

$

$

848,347

$

784,433

$

450,322

$

(512,227)

$

1,570,875

Cost of sales

448,433

615,772

364,614

(512,227)

916,592

Gross margin

399,914

168,661

85,708

654,283

Operating expenses

1,496

269,003

265,206

70,868

(43,182)

563,391

Operating (loss) income

(1,496)

130,911

(96,545)

14,840

43,182

90,892

Other income and expenses, net

42,035

1,147

(43,182)

Interest (expense) income, net

(2,239)

(36,576)

2,575

(428)

(36,668)

(Loss) earnings before income taxes

(3,735)

94,335

(51,935)

15,559

54,224

(Benefit) provision for income taxes

(787)

19,484

(9,335)

3,454

12,816

(Loss) earnings before equity in net income of subsidiaries

(2,948)

74,851

(42,600)

12,105

41,408

Equity in earnings (loss) of subsidiaries

44,356

(30,495)

(13,861)

Net earnings (loss)

$

41,408

$

44,356

$

(42,600)

$

12,105

$

(13,861)

$

41,408

Comprehensive income (loss)

$

14,815

$

26,332

$

(42,600)

$

3,536

$

12,732

$

14,815

Six Months Ended August 4, 2018

Net sales

$

$

889,932

$

767,740

$

292,192

$

(308,470)

$

1,641,394

Cost of sales

445,183

579,000

211,555

(308,470)

927,268

Gross margin

444,749

188,740

80,637

714,126

Operating expenses

1,965

269,846

271,076

57,507

(27,151)

573,243

Operating (loss) income

(1,965)

174,903

(82,336)

23,130

27,151

140,883

Other income and expenses, net

27,151

(27,151)

Interest (expense) income, net

(1,687)

(46,124)

4,145

1,028

(42,638)

Loss on extinguishment of debt, net

(20,833)

(20,833)

(Loss) earnings before income taxes

(3,652)

107,946

(51,040)

24,158

77,412

(Benefit) provision for income taxes

(1,119)

20,578

(10,568)

5,374

14,265

(Loss) earnings before equity in net income of subsidiaries

(2,533)

87,368

(40,472)

18,784

63,147

Equity in earnings (loss) of subsidiaries

65,680

(21,688)

(43,992)

Net earnings (loss)

$

63,147

$

65,680

$

(40,472)

$

18,784

$

(43,992)

$

63,147

Comprehensive income (loss)

$

45,149

$

66,772

$

(40,472)

$

(306)

$

(25,994)

$

45,149

Tailored Brands, Inc.

Condensed Consolidating Statement of Cash Flows

For the Six Months Ended August 3, 2019

(in thousands)

Tailored

The Men’s

Guarantor

Non-Guarantor

    

Brands, Inc.

    

Wearhouse, Inc.

    

Subsidiaries

    

Subsidiaries

    

Eliminations

    

Consolidated

 

Net cash provided by (used in) operating activities

$

18,957

$

204,479

$

21,748

$

(193,077)

$

(18,784)

$

33,323

CASH FLOWS FROM INVESTING ACTIVITIES:

Capital expenditures

(13,550)

(21,153)

(4,389)

(39,092)

Intercompany activities

(192,290)

(30,953)

223,243

Net cash used in investing activities

(205,840)

(21,153)

(35,342)

223,243

(39,092)

CASH FLOWS FROM FINANCING ACTIVITIES:

Payments on new term loan

(7,120)

(7,120)

Proceeds from asset-based revolving credit facility

673,500

673,500

Payments on asset-based revolving credit facility

(677,000)

(677,000)

Intercompany activities

12,169

192,290

(204,459)

Cash dividends paid

(18,784)

(18,784)

Proceeds from issuance of common stock

879

879

Tax payments related to vested deferred stock units

(1,052)

(1,052)

Net cash (used in) provided by financing activities

(18,957)

1,549

192,290

(204,459)

(29,577)

Effect of exchange rate changes

(609)

(609)

Increase (decrease) in cash and cash equivalents

188

595

(36,738)

(35,955)

Cash and cash equivalents at beginning of period

970

1,496

52,965

55,431

Cash and cash equivalents at end of period

$

$

1,158

$

2,091

$

16,227

$

$

19,476

Tailored Brands, Inc.

Condensed Consolidating Statement of Cash Flows

For the Six Months Ended August 4, 2018

(in thousands)

Tailored

The Men’s

Guarantor

Non-Guarantor

    

Brands, Inc.

    

Wearhouse, Inc.

    

Subsidiaries

    

Subsidiaries

    

Eliminations

    

Consolidated

 

Net cash provided by (used in) operating activities

$

21,132

$

320,774

$

(2,235)

$

(122,936)

$

(18,744)

$

197,991

CASH FLOWS FROM INVESTING ACTIVITIES:

Capital expenditures

(6,058)

(15,485)

(3,102)

(24,645)

Proceeds from divestiture of business

17,755

17,755

Intercompany activities

(142,775)

142,775

Net cash (used in) provided by investing activities

(148,833)

2,270

(3,102)

142,775

(6,890)

CASH FLOWS FROM FINANCING ACTIVITIES:

Payments on original term loan

(993,420)

(993,420)

Proceeds from new term loan

895,500

895,500

Payments on new term loan

(4,500)

(4,500)

Proceeds from asset-based revolving credit facility

199,500

199,500

Payments on asset-based revolving credit facility

(95,000)

(95,000)

Repurchase and retirement of senior notes

(199,365)

(199,365)

Deferred financing costs

(5,644)

(5,644)

Intercompany activities

(18,744)

142,775

(124,031)

Cash dividends paid

(18,744)

(18,744)

Proceeds from issuance of common stock

4,113

4,113

Tax payments related to vested deferred stock units

(6,501)

(6,501)

Net cash (used in) provided by financing activities

(21,132)

(221,673)

142,775

(124,031)

(224,061)

Effect of exchange rate changes

(2,432)

(2,432)

(Decrease) increase in cash and cash equivalents

(49,732)

35

14,305

(35,392)

Cash and cash equivalents at beginning of period

51,818

2,180

49,609

103,607

Cash and cash equivalents at end of period

$

$

2,086

$

2,215

$

63,914

$

$

68,215