US: Jos A Bank cautious as it swings to Q1 loss
- Q1 net loss of US$37.1m
- Gross margin decline in May
- Sales rise 11%
US men's apparel and footwear business Jos A Bank Clothiers has said it remains cautious heading into the crucial Father's Day period after suffering a gross margin decline in May and swinging to a loss in its first-quarter.
The retail group swung to a loss in the three months ended 3 May, hurt by costs related to its acquisition by Men's Wearhouse, which is expected to close in the next few weeks.
Jos A Bank posted a loss of US$37.1m in the period, compared with a profit of $8.1m, or $0.29 cents per share, a year earlier. Excluding around $75.4m in costs related to the deal, the company earned $0.32 cents per share.
Sales rose 11% to $217.4m, while comparable-brand sales rose 8.4%.
CEO Neal Black said the company was pleased to have continued the positive adjusted earnings trend that started in the second half, but added that its gross profit margin rate declined in May as it aggressively sold clearance goods left over from spring 2013 and its sales and marketing expenses increased.
"We are therefore cautious as we approach the critical Father's Day selling period as we attempt to balance strong sales with the appropriate amount of clearance markdowns and advertising expenses," he said.
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