Men’s wear retailer Tailored Brands Inc. finished off 2017 with some signs of momentum.
For the full year, net profits nearly quadrupled, to $96.7 million, or $1.95 a diluted share, from $25 million, or 51 cents, in 2016. It was a case of doing more with less, as sales for the year slipped modestly, to $3.3 billion from $3.38 billion.
Comparable sales inched up 0.1 percent, with a 1.1 percent decline at the Men’s Wearhouse division and a 5.4 percent gain at the Jos. A. Bank unit. (Results saw some firming in the fourth quarter, when total comps perked up 2.5 percent, with a 2.3 percent gain from Men’s Wearhouse and a 5.3 percent rise at Jos. A. Bank).
Investors liked what they saw and pushed shares of the retailer up 7.3 percent to $24.90 in after-hours trading.
“In 2017, we delivered significant EPS growth and finished the year strong with positive comparable sales for both Men’s Wearhouse and Jos. A. Bank in the fourth quarter,” said Doug Ewert, chief executive officer. “Our performance reflects the progress we are making on our key growth strategies. We more than doubled our custom business to over $100 million in 2017. We believe Tailored Brands is the largest and fastest-growing retailer of men’s custom clothing in North America and we plan to further enhance and differentiate our custom offering in 2018.”
The firm, which initially took a big hit after it acquired Jos. A. Bank in 2014, has been taking steps to improve its financial profile.
Tailored Brands cut its debt by about $200 million, to $1.4 billion, and lowered its inventories by 11 percent. It also sold its MW Cleaners business, an independent dry cleaning business that was not a part of its formalwear rental operations, for $18 million.
“In 2018, we plan to further reduce our debt, invest behind our growth strategies and return cash to shareholders via our dividend,” Ewert said.
Further, the company’s looking this year to drive comps and Men’s Wearhouse and Jos. A. Bank up by a percentage in the low-single digits.