The negative guidance implies that, subject to revision based on sales during the final days of the fiscal year ending Feb. 2, year-end profits will be $78 million versus $97.5 million in 2011. That further suggests that fourth-quarter profits will be off 39.5 percent, to $26.7 million, while earnings per diluted share, based on the company’s approximately 28 million shares of common stock outstanding, would descend to 95 cents, nearly 46 percent below the $1.76 result previously expected, on average, by analysts.
The largemiss projected by Jos. A. Bank also weighed on the stock of the nation’s largest men’s wear retailer, Men’s Wearhouse Inc., which saw its shares drop $1.94, or 5.9 percent, to close at $31.21.
Despite what Neal Black, president and chief executive officer of the Hampstead, Md.-based Jos. A. Bank, termed a “strong marketing and promotional strategy” for holiday, customers “didn’t respond as well to our promotional items as they had in the past. Our customers responded well to our suit promotions for this period, but our nonsuit customers responded poorly to our holiday season offerings, even at very low prices, on products such as sweaters, outerwear, hats, gloves, scarves and jackets made of heavier fabrics.”
Black didn’t return calls seeking further comment Monday.
In a research note issued Monday morning, Stifel Nicolaus analyst Richard Jaffe noted the promotional disconnect represented “a change from nearly 10 years of successfully and profitably driving sales with marketing and promotions.” While also highly dependent on promotional pricing, Men’s Wearhouse might fare better as it is “not nearly as sportswear-driven as [Bank] due to its dominant tuxedo and suits business.”
Bank, which missed third-quarter analysts’ estimates with an 11.2 percent drop in profits, did report “double-digit gains” in e-commerce during the fourth quarter.
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