Jos. A. Bank may raise guidance after results

BUSINESS DIGEST

December 08, 2006|By Andrea K. Walker | Andrea K. Walker,Sun reporter

Jos. A. Bank Clothiers Inc. said that it would consider raising year-end guidance after reporting strong third-quarter earnings yesterday.

The Hampstead-based men's apparel chain reported net income of $5.5 million for the fiscal quarter that ended Oct. 28, a 17 percent increase from the $4.7 million earned for the corresponding period the previous year.

Earnings per share increased 15 percent to 30 cents, compared with 26 cents a year ago.

Sales rose 13 percent to $119.5 million from $105.6 million. Comparable store sales -- which count stores open a year -- jumped 2.3 percent. Analysts surveyed by Thomson Financial forecast a profit of 29 cents per share on sales of $119.5 million.

The clothing chain is in the midst of its busiest sales season and said it only expects business to get better as the holidays progress.

"In general, we plan for the sales volume to build as we get closer to Christmas," David Ullman, Bank's chief executive officer, said during a conference call with analysts. "So there is still a substantial part of our sales volume to be generated between now and the end of the year."

The company was more cautious earlier in the third quarter when August sales came in at a surprising 6.1 percent sales decline. Sales increased 12.9 percent in August 2005. Disclosure of the sales drop pushed the stock down more than 16 percent in one day.

The sales decline also caused the company to tell analysts it would carefully watch the rest of the year's performance. Bank also declined to raise its sales projections for the year then. Companies will often raise their estimates for future periods if they performed better than expected in the previous quarter.

Yesterday, Ullman said the company is considering raising the estimates in part because of a strong November showing, when sales increased 9.6 percent.

Ullman said that the first week of December was slow but has picked up. The company also expects that the Saturday before Christmas to be as strong as the day after Thanksgiving.

"I think everything is going to come late this year," said Robert N. Wildrick, Bank's chief executive officer and president. "I think there is some pent up buying out there."

Dress shirts and sportswear led third-quarter sales at the company. Suit sales were even with last year.

Jos. A. Bank stock fell yesterday 0.16 percent, or 5 cents, to close at $31.05.

andrea.walker@baltsun.com

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