Jos. A. Bank Falls After Lowering Annual Forecast
Jos. A. Bank Clothiers Inc. (JOSB) plunged the most in more than four years after saying annual profit will fall 20 percent amid lost sales from unseasonably warm weather and U.S. political uncertainty.
Shares of the century-old maker of men’s apparel fell 15 percent to $39.28 at the close in New York, the biggest one-day drop since September 2008. Competitor Men’s Wearhouse Inc. (MW) also declined today, falling 5.9 percent to $31.21, the biggest one-day drop since June.
While sales for the fiscal year ending Feb. 2 will exceed $1 billion for the first time, the increase will be offset by higher marketing expenses and lower gross margin, the Hampstead, Maryland-based retailer said in a statement after the close of trading on Jan. 25. Jos. A. Bank said the fourth quarter started slowly, hurt by superstorm Sandy, uncertainty around the U.S. presidential election and the fiscal cliff, and was further affected by warm weather.
“Going into the critical holiday selling season, starting on Black Friday, we believed we had a strong marketing and promotional strategy for the period,” Chief Executive Officer R. Neal Black said in the statement. “However, many of the promotional items and a large part of our holiday assortment were items that sell best in cold weather and the weather was unseasonably warm.”
Jos. A. Bank, founded in 1905, fell 13 percent in 2012, snapping three straight years of gains. The shares were up 8.7 percent this year through Jan. 25 compared with a 9.1 percent gain for the Standard & Poor’s 500 Retailing Index.
To contact the reporter on this story: Sapna Maheshwari in New York at email@example.com
To contact the editor responsible for this story: Robin Ajello at firstname.lastname@example.org