Clothier loses the man who mended it

Jos. A. Bank says Finley has retired after 8 1/2 years at helm

Giordano is interim CEO

In trouble in 1990, company was rebuilt `from the ground up'

May 22, 1999|By Lorraine Mirabella | Lorraine Mirabella,SUN STAFF

Timothy F. Finley, the chairman and chief executive officer of Jos. A. Bank Clothiers Inc. credited with reviving the once-foundering men's apparel retailer, stepped down yesterday after 8 1/2 years.

Finley, 55, known for turning struggling companies around, retired, the Hampstead-based company said. He will continue to work for Bank as a consultant.

Andrew A. Giordano, 66, a Bank director since 1994 and head of the board of directors' executive committee since 1995, has taken over temporarily while the board searches for a replacement.

"Tim has gone into semi-retirement," said Frank Tworecke, the company's executive vice president and chief operating officer. "Eight and a half years ago, we were in dire need of his expertise. He successfully applied it and put the company in a position to grow and prosper."

When Finley took over in August 1990, the longtime Baltimore retailer and manufacturer of its own tailored clothing was saddled with roughly $70 million in debt from a leveraged buyout in late 1986.

The chain then had more than 30 stores, but they varied widely in size and merchandise, said Kenneth Gassman, a retail analyst with Davenport and Co. in Richmond, Va.

Promotions were unfocused. And the company, built on men's apparel, was trying unsuccessfully to sell women's fashions, Gassman recalled. "The company was about ready to go out of business," he said. Finley, Gassman said, "rebuilt the company from the ground up."

Finley was able to restructure the debt and convert it to equity, then take the company public in 1994, said David E. Ullman, executive vice president and chief financial officer. Then Finley installed a new management team.

"Today, we're in the best financial position ever," Ullman said. "He's completed his major tasks."

Finley steered the company through several major transitions. He did away with women's apparel in 1995. In February 1998, Bank sold its remaining manufacturing operation to an upstate New York garment maker. And, over the past 2 1/2 years, Bank has been aggressive in opening stores in existing markets, adding 32 to bring its total to 105.

Bank plans to open as many as 10 stores this year and about 15 in each of the next two years.

During fiscal 1998, the company's income from continuing operations rose to $5.9 million, from $2.5 million the previous year, which included a one-time, $1.4 million tax benefit recorded in the third quarter. Bank's total sales for the year rose 8.7 percent, to $187.2 million, compared with $172.2 million reported for fiscal 1997.

When it releases its most recent financial results May 25, Bank expects a profitable first quarter, though earnings are expected to fall short of last year's first quarter. "While the results for the April quarter may not be what we expected, the company's on solid ground," Gassman said. "If you look over the history, [Finley] did several things right. He stripped down the fixed costs -- the manufacturing operation; he standardized the stores; and he took the business back to its core."

Finley has relocated to Sarasota, Fla., and was unavailable yesterday.

"He never anticipated being here eight years, but he was always asked to stay to take it to the next level," Ullman said.

Bank plans to continue Finley's strategy of expanding stores, developing new product lines and boosting sales through the company's catalog and over the Internet, Ullman said.

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