Mar 11, 2010
Men's Wearhouse fourth quarter adjusted loss narrower than Street view
Mar 11, 2010
March 10 (Reuters) - Men's Wearhouse Inc's (MW.N) fourth-quarter adjusted loss was narrower than estimates, but revenue fell short of market expectations as reduced store traffic and a lower domestic average ticket hurt sales, sending its shares down 6 percent.
However, the owner of nearly 1,300 stores under the Men's Wearhouse, Moores and K&G brands expects to report a first-quarter profit of between 12 cents and 16 cents a share.
Analysts were looking for earnings of 9 cents a share, according to Thomson Reuters I/B/E/S.
The company expects gross profit in the first quarter to rise in the low single digit range.
For the fourth quarter ended Jan. 30, it posted a net loss of $18.9 million, or 36 cents a share, compared with a profit of $1.5 million, or 3 cents a share, a year earlier.
Excluding an asset impairment charge, the apparel retailer reported a loss of 11 cents a share.
Revenue at the company, which also sells and rents out tuxedos, fell 4 percent to $457.2 million.
Analysts were looking for a loss of 16 cents a share, on revenue of $465.9 million, for the first quarter.
Comparable store sales, a key metric of retail health, fell 7.1 percent at the company's Men's Wearhouse and tuxedo stores during the quarter, and slipped 5 percent at its K&G stores.
The company's suit product category at its Men's Warehouse stores saw a sharp decline with dollar and unit comparable sales falling 15.6 percent and 19.9 percent, respectively, Chief Executive George Zimmer said on a conference call with analysts.
"This is a significant reversal of results realized for the first three quarters of the year," he said.
Zimmer added that the company plans to close over 65 tuxedo rental stores in 2010. It closed 35 in 2009.
Men's Wearhouse expects first-quarter comparable store sales at its namesake stores to be in the flat to negative low single digit range.
At K&G, it sees a drop in the low single digit range. The apparel retailer plans to spend $55 million to $60 million in capital expenditures during 2010, compared with $56.9 million spent in 2009.
Shares of the Houston-based company fell 6 percent to $23.40 in trading after the bell. They closed at $24.83 Wednesday 10 March on the New York Stock Exchange. (Reporting by Shradhha Sharma in Bangalore; Editing by Gopakumar Warrier and Maju Samuel)
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