Men's Wearhouse Q1 profit falls 76%

US: Men's Wearhouse Q1 profit falls 76%

Author: just-style.com | 29 May 2008

Specialty apparel retailer The Men's Wearhouse has posted a 76% drop in first quarter profit on lower sales and tuxedo rental revenues.

For the first quarter ended 3 May, the Houston-based retailer said net income fell to $9.9m, or $0.19 a share, from $40.9m, or $0.75 cents a share, the year before.

Excluding costs of $0.9m for closing the Canadian based manufacturing facility operated by its Golden Brand subsidiary, the company said earnings per share were $0.20 - the bottom end of earlier guidance.

Revenues slipped 1% to $491.1m from $496.1m in the comparable quarter of 2007.

Apparel sales, which account for 79% of total revenues, were down 4.6% as fewer people visited its stores.

Tuxedo rental revenues fell 18.6% on reduced demand at the stores acquired from After Hours as well as the sale of its wholesale tuxedo rental operations in July 2007.

Selling, general and administrative expenses rose 22 percent during the quarter to $196.7m.

For its second quarter, Men's Wearhouse expects earnings per share to be $0.69 to $0.73. Excluding costs of closing its Canadian facility, earnings per share are likely to be $0.75 to $0.79.

Guidance for fiscal 2008 is for earnings per share of $1.65 to $1.75, or $1.75 to $1.85 excluding costs.

Men's Wearhouse operates 1,285 stores under the Men's Wearhouse, Moores, K&G and MW Tux nameplates.

Sectors: Apparel, Finance, Retail

Companies: Men’s Wearhouse