- The Washington Times - Monday, March 25, 2002

Jos A. Bank Clothiers Inc. last week reported a second consecutive year of record earnings. The news pushed up its shares, as the company said it expects to set more records this year and open 20 new stores.
The Hampsted, Md., men's clothing store chain said its income for fiscal 2002 ended Feb. 3 rose 31 percent to $6.5 million ($1.05 per share) from $5 million (80 cents) the year before. Revenues rose to $211 million from $206.3 million during fiscal 2001.
Quarterly income rose 52 percent to $4.4 million (70 cents) from $2.9 million (48 cents) for the like period a year before. Revenues barely rose to $67.3 million from $67.2 million.
"It's a tough environment right now, but they've done really well, mainly because they are putting a lot more of their sportswear line out while the suit business has been kind of down lately," says Preston Silvey, an analyst with First Dallas Securities.
Suits represent slightly less than 30 percent of the company's business. Sports coats and slacks account for 20 percent, and the rest is shirts, ties, sportswear and shoes.
Shares of Jos A. Bank hit a 12-month high of $14.74 Friday on Nasdaq, up from its year low of $4.08 in September.
The company's success is a result of the quality of its products and brand name, says David E. Ullman, executive vice president and chief financial officer at Jos A. Bank. But analysts say that effective management and frugal spending also have contributed.
Despite slowing sales, operating income at Jos A. Bank rose almost 50 percent last year because of substantially higher gross margin, writes Carole Cranmer, an analyst with Morgan Lewis Githens & Ahn Co., in her March 19 report on the company.
"Approximately two-thirds of the improvement came from the cost side, as the company was able to realize further sourcing/manufacturing efficiencies," Miss Cranmer writes. "About one-third of the improvements came from the retail side, as the mix was better merchandized and markdowns were better managed."
The amount of merchandise at Jos A. Bank stores was lower last year, but this made selling items easier, without the need for large markdowns. The company also grew its sportswear business, which helped offset declining suit sales.
Established in 1905, Jos A. Bank is one of the nation's leading men's clothing retailers with 136 stores nationwide. Nine of them are in the Washington region, with one more coming soon to Fair Oaks Mall in Fairfax.
"Every store we've opened in the region has been successful," says Mr. Ullman, adding that the company is looking to add two or three stores in the region by the end of the year.
The majority of Jos A. Bank's business 88 percent stems from store sales. The other 12 percent comes from sales made though the Jos A. Bank catalog and Web site.
Jos A. Bank is in a niche business, considering that its product line includes such items as formal wear, swimwear and shoes catering strictly to men. Among the company's competitors are department stores and Men's Wearhouse, whose focus is the suit business.
"They are doing very well compared to competitors," says Mr. Silvey, pointing to Men's Wearhouse, which did not perform as well last year. The competitor's income dropped by 49 percent last year, while sales fell 4.5 percent.


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