Segment Reporting

3 Months Ended

May 02, 2015

Segment Reporting

Segment Reporting

13.  Segment Reporting

Our operations are conducted in two reportable segments, retail and corporate apparel, based on the way we manage, evaluate and internally report our business activities.

The retail segment includes the results from our four retail merchandising brands: Men’s Wearhouse/Men’s Wearhouse and Tux, Jos. A. Bank, Moores Clothing for Men (“Moores”) and K&G.  These four brands are operating segments that have been aggregated into the retail reportable segment.  MW Cleaners is also aggregated in the retail segment as these operations have not had a significant effect on our revenues or expenses.  Specialty apparel merchandise offered by our four retail merchandising concepts include suits, suit separates, sport coats, slacks, business casual, sportswear, outerwear, dress and casual shirts, shoes and accessories for men.  Ladies’ career apparel, sportswear and accessories, including shoes, and children’s apparel is offered at most of our K&G stores.  Tuxedo rentals are offered at our Men’s Wearhouse/Men’s Wearhouse and Tux, Jos. A. Bank and Moores retail stores.

The corporate apparel segment includes the results from our corporate apparel and uniform operations conducted by Twin Hill in the U.S. and Dimensions, Alexandra, and Yaffy in the United Kingdom (“UK”).  The two corporate apparel and uniform concepts are operating segments that have been aggregated into the reportable corporate apparel segment.  The corporate apparel segment provides corporate clothing uniforms and workwear to workforces.

We measure segment profitability based on operating income, defined as income before interest expense, interest income, income taxes and non-controlling interest.  Corporate expenses and assets are allocated to the retail segment.

Net sales by brand and reportable segment are as follows (in thousands):

	For the Three Months Ended
	May 2,		May 3,
	2015		2014
Net sales:
MW (1)	$	456,376	$	420,979
Jos. A. Bank	216,062		—
Moores	47,520		52,502
K&G	95,996		92,421
MW Cleaners	8,317		7,747
Total retail segment	824,271		573,649
Twin Hill	8,578		8,244
Dimensions and Alexandra (UK)	52,240		48,581
Total corporate apparel segment	60,818		56,825
Total net sales	$	885,089	$	630,474

(1) MW includes Men’s Wearhouse and Men’s Wearhouse and Tux stores and JA Holding.

The following table sets forth supplemental products and services sales information for the Company (in thousands):

	For the Three Months Ended
	May 2,		May 3,
	2015		2014
Net sales:
Men’s tailored clothing product	$	386,336	$	239,436
Men’s non-tailored clothing product	256,010		171,106
Ladies clothing product	21,632		20,851
Other	2,884		1,631
Total retail clothing product	666,862		433,024
Tuxedo rental services	103,129		101,663
Alteration services	45,963		31,215
Retail dry cleaning services	8,317		7,747
Total alteration and other services	54,280		38,962
Corporate apparel clothing product	60,818		56,825
Total net sales	$	885,089	$	630,474

Operating income by reportable segment and the reconciliation to earnings before income taxes is as follows (in thousands):

	For the Three Months Ended
	May 2,			May 3,
	2015			2014
Operating income:
Retail	$	54,033		$	26,525
Corporate apparel	1,256			756
Operating income	55,289			27,281
Interest income	28			61
Interest expense	(26,483		)	(1,135		)
Loss on extinguishment of debt	(12,675		)	—
Earnings before income taxes	$	16,159		$	26,207