Men's Wearhouse, Inc. (MW) said Wednesday after the markets closed that its fourth quarter loss narrowed from last year, helped by higher sales and tight expense control.
However, the company's quarterly loss per share was wider than analysts expected and its quarterly sales fell shy of analysts' forecast.
Doug Ewert, Men's Wearhouse president and chief executive officer, said, "Our fourth quarter started out with an unprecedented volume decline in November which we described in our third quarter earnings release and conference call. The balance of the fourth quarter improved over November results; however, macro-economic conditions remained challenging for our customers throughout the period, which resulted in fourth quarter and full year results that were two cents below the low end of our guidance range provided on December 5, 2012."
The company also said it has hired Jefferies & Co. to assist it in evaluating strategic alternatives for its K&G operations in order to better focus its efforts on Men's Wearhouse and Moores men's specialty apparel retailing.
Additionally, the company said its board has approved a new $200 million stock buyback program, which amends and increases its existing stock buyback authorization. The company had $45 million available in its prior buyback program and the latest action adds an additional $155 million for share buybacks by the company.
Men's Wearhouse shares are currently gaining 12.14% in after hours trading after closing the day's regular trading session at $29.07, down 10 cents. The shares trade in a 52-week range of $25.97 to $40.67.
For the fourth quarter ended February 2, 2013, the Houston, Texas-based men's apparel retailer reported a net loss of $3.4 million or $0.07 per share, compared to a net loss of $3.8 million or $0.07 per share for the year-ago quarter.
The year-ago quarter results included $0.02 per share in acquisition related integration costs and a less than $0.01 per share non-cash asset impairment charge.
On average, 6 analysts polled by Thomson Reuters expected the company to report a loss of $0.05 per share for the fourth quarter. Analysts' estimates typically exclude special items.
Total net sales for the fourth quarter rose 8.2% to $608.43 million from $562.17 million in the same quarter last year. Five analysts had a consensus revenue estimate of $610.00 million for the fourth quarter.
For the fourth quarter, the company had forecast a loss of $0.05 per share to earnings of $0.01 per share and total sales growth of 9.5% to 10.5%.
Total gross margin for the quarter narrowed to 39.96% from 40.00% a year earlier, while retail gross margin increased to 56.43% from 54.52% last year.
Clothing product retail sales for the quarter increased 6% year-over-year to $456.06 million, while Tuxedo rental sales rose 13% to $49.2 million.
Brand wise, fourth quarter sales at the company's namesake stores increased 9% to $372.7 million, while sales at off-price retail chain K&G Superstores fell 0.1% to $95.5 million. Sales from Canadian store chain Moores, Clothing for Men rose 4% to $67.8 million.
For the fourth quarter, same-store sales increased 1% at Men's Wearhouse, but fell 5.5% at Moores Canada and 5.7% at K&G Superstores.
Corporate apparel segment sales for the fourth quarter increased 21.5% to $65.0 million.
At the end of the fourth quarter, the company operated 1,143 stores under the Men's Wearhouse, Moores, K&G and Men's Wearhouse and Tux brands, compared to 1,166 stores a year ago.
The company modified its forward guidance practice beginning with fiscal 2013 by giving annual guidance only. For the current fiscal year, the company forecast earnings of $2.70 to $2.80 per share and sales growth of 2.85% to 3.85%.
Analysts currently expect the company to earn $2.77 per share on sales growth of 3.10% for the fiscal year 2013.
by RTT Staff Writer
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