Jos. A. Bank earnings leap 33% for best quarter ever

48 cents a share posted as sales increase, expenses are reined

March 07, 2001|By Lorraine Mirabella | Lorraine Mirabella,SUN STAFF

Men's apparel retailer Jos. A. Bank Clothiers Inc. posted its best quarter ever yesterday as it reported earnings in its fourth quarter rose 33 percent to a record $2.9 million, or 48 cents per diluted share.

The numbers for the three months that ended Feb. 3 were up from $2.5 million, or 36 cents per diluted share, before one-time charges for the last three months of fiscal 1999. The Hampstead-based chain had said it expected an earnings increase of at least 25 percent.

The improvement was attributed to increased sales and tighter controls on expenses.

"We believe we had one of the best performances among retailers in 2000, especially during the all-important holiday season," said David E. Ullman, chief financial officer for the 117-store chain.

Total sales during the quarter were up 14.5 percent to $71 million, compared with $62 million in the fourth quarter of 1999. Sales at stores open at least a year - a key benchmark of a retailer's performance - rose 14.6 percent in November, December and January, outpacing much of the industry.

Also during the quarter, Internet sales jumped 157 percent, while catalog sales declined 14.1 percent.

Sales increases were driven by consumer purchases of corporate casual wear and sportswear, such as slacks, sport coats and merino wool sweaters, Ullman said.

Analysts have said Bank has been successful in carving out a niche in corporate casual wear, and thus has benefited as men are dressing less formally at work.

But suit sales - which account for about one-fourth of business - also have been picking up, said Robert N. Wildrick, chief executive officer.

"That's good because we've been so strong in corporate casual," he said. "As the economy has gotten tougher, people are requiring a little stronger dress code."

Jos. Bank opened eight stores last fall. The chain expects to open 11 stores in the spring and 19 more in the fall. The company will dip into a $50 million line of credit to finance the new stores, at a construction cost of about $500,000 each. Each new store should add about 1 cent per share to earnings, Wildrick said.

During February and so far in March - the first weeks of the new fiscal year - sales have been relatively slow, Wildrick said.

"It's not a disaster," he said. "The catalog business is better than planned. Store business is slower than we had hoped but at plan. We have been spoiled with our results, so we get down to normal business and it's a little disappointing."

For the fiscal year, earnings were $5 million, or 80 cents per share, up from $3.2 million, or 47 cents per share, in fiscal 1999 before the one-time charges.

The company's shares rose 69 cents in trading yesterday to close at $7.25 - more than twice their 52-week low.

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