Tailored Brands earnings miss in Q3, revises outlook
Menswear group Tailored Brands reported third quarter revenue that missed expectations on Wednesday forcing the company to cut its full year outlook.
The company’s total net sales for the quarter increased 0.2 percent to $812.7 million. The biggest decline was posted by Tailored Brands’ corporate apparel segment, where net sales decreased by 3.6 percent, or $2.3 million, primarily due to lower sales in the United Kingdom.
The company’s retail net sales increased 0.6 percent due to an increase in retail clothing sales, but was partially offset by a $7.3 million decrease in alteration and other services primarily resulting from the MW Cleaners divestiture.
Still, retail clothing sales and its brand portfolio was enough to drive positive retail comparable sales up 2.3 percent.
Men’s Wearhouse reported a 1.7 percent comps increase, while Moores comparable sales increased 1.2 percent. K&G and Jos. A. Bank were the strongest players, registering comps increases of 4 percent and 3.8 percent, respectively.
The company’s second-quarter net earnings totaled $13.9 million, down from $36.9 million in the prior-year period.
In a release, Tailored Brands Executive Chairman Dinesh Lathi, who is acting as interim CEO, following Doug Ewert’s retirement at the end of September said, “I am pleased with the team’s execution on our custom growth strategy. During the quarter, we improved our custom offering’s speed, selection and service, making custom even more compelling to consumers.”
Lathi joined Tailored Brands’ Board in 2016 and was previously CEO of homeware website One Kings Lane.
Nonetheless, he noted “a softening of comparable sales” as the third quarter progressed and as a result, lowered its fourth quarter outlook.
Tailored Brands now expects EPS between $2.30 and $2.35 for the year, versus its previous range of $2.35 a share and $2.50 a share.
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