Condensed Consolidating Information (Tables)

9 Months Ended

Oct. 28, 2017

Condensed Consolidating Information

Condensed Consolidating Balance Sheet

Tailored Brands, Inc.

Condensed Consolidating Balance Sheet

October 28, 2017

(in thousands)

	Tailored		The Men’s		Guarantor		Non-Guarantor
	Brands, Inc.		Wearhouse, Inc.		Subsidiaries		Subsidiaries		Eliminations		Consolidated
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	—	$	20,224	$	1,941	$	104,079	$	—	$	126,244
Accounts receivable, net		7,414		19,518		287,688		35,137		(268,564)		81,193
Inventories		—		198,429		458,603		315,969		—		973,001
Other current assets		7,275		87,450		26,185		7,889		(75,233)		53,566
Total current assets		14,689		325,621		774,417		463,074		(343,797)		1,234,004
Property and equipment, net		—		207,432		212,213		35,276		—		454,921
Rental product, net		—		107,222		2,327		15,771		—		125,320
Goodwill		—		6,160		68,510		44,455		—		119,125
Intangible assets, net		—		—		155,884		13,188		—		169,072
Investments in subsidiaries		77,901		1,308,676		—		—		(1,386,577)		—
Other assets		—		7,780		821		6,558		(6,300)		8,859
Total assets	$	92,590	$	1,962,891	$	1,214,172	$	578,322	$	(1,736,674)	$	2,111,301
LIABILITIES AND SHAREHOLDERS' (DEFICIT) EQUITY
CURRENT LIABILITIES:
Accounts payable	$	87,758	$	189,756	$	81,409	$	96,503	$	(268,564)	$	186,862
Accrued expenses and other current liabilities		18,911		139,577		109,718		102,508		(67,957)		302,757
Current portion of long-term debt		—		8,750		—		—		—		8,750
Total current liabilities		106,669		338,083		191,127		199,011		(336,521)		498,369
Long-term debt, net		—		1,467,735		—		—		—		1,467,735
Deferred taxes, net and other liabilities		921		79,172		83,342		10,338		(13,576)		160,197
Shareholders' (deficit) equity		(15,000)		77,901		939,703		368,973		(1,386,577)		(15,000)
Total liabilities and shareholders' (deficit) equity	$	92,590	$	1,962,891	$	1,214,172	$	578,322	$	(1,736,674)	$	2,111,301

Tailored Brands, Inc.

Condensed Consolidating Balance Sheet

October 29, 2016

(in thousands)

	Tailored		The Men’s		Guarantor		Non-Guarantor
	Brands, Inc.		Wearhouse, Inc.		Subsidiaries		Subsidiaries		Eliminations		Consolidated
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	—	$	5,435	$	1,984	$	27,529	$	—	$	34,948
Accounts receivable, net		7,373		17,112		455,368		31,140		(439,095)		71,898
Inventories		—		253,482		459,159		335,274		—		1,047,915
Other current assets		7,102		22,155		42,995		6,963		(19,025)		60,190
Total current assets		14,475		298,184		959,506		400,906		(458,120)		1,214,951
Property and equipment, net		—		249,797		217,156		34,438		—		501,391
Rental product, net		—		139,386		3,677		17,038		—		160,101
Goodwill		—		6,160		68,510		41,356		—		116,026
Intangible assets, net		—		105		157,788		14,444		—		172,337
Investments in subsidiaries		(67,257)		1,375,395		—		—		(1,308,138)		—
Other assets		3,257		6,004		939		7,623		(7,500)		10,323
Total assets	$	(49,525)	$	2,075,031	$	1,407,576	$	515,805	$	(1,773,758)	$	2,175,129
LIABILITIES AND SHAREHOLDERS' (DEFICIT) EQUITY
CURRENT LIABILITIES:
Accounts payable	$	16,216	$	337,499	$	99,597	$	185,982	$	(439,095)	$	200,199
Accrued expenses and other current liabilities		9,617		143,023		105,446		42,514		(19,025)		281,575
Current portion of long-term debt		—		7,000		—		—		—		7,000
Total current liabilities		25,833		487,522		205,043		228,496		(458,120)		488,774
Long-term debt, net		—		1,588,873		—		—		—		1,588,873
Deferred taxes, net and other liabilities		2,339		65,893		104,512		9,935		(7,500)		175,179
Shareholders' (deficit) equity		(77,697)		(67,257)		1,098,021		277,374		(1,308,138)		(77,697)
Total liabilities and shareholders' (deficit) equity	$	(49,525)	$	2,075,031	$	1,407,576	$	515,805	$	(1,773,758)	$	2,175,129

Tailored Brands, Inc.

Condensed Consolidating Balance Sheet

January 28, 2017

(in thousands)

	Tailored		The Men’s		Guarantor		Non-Guarantor
	Brands, Inc.		Wearhouse, Inc.		Subsidiaries		Subsidiaries		Eliminations		Consolidated
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	—	$	1,002	$	1,881	$	68,006	$	—	$	70,889
Accounts receivable, net		7,376		15,499		476,742		56,777		(490,680)		65,714
Inventories		—		230,264		438,167		287,081		—		955,512
Other current assets		12,773		134,225		28,436		8,448		(110,280)		73,602
Total current assets		20,149		380,990		945,226		420,312		(600,960)		1,165,717
Property and equipment, net		—		232,090		216,248		35,827		—		484,165
Rental product, net		—		131,287		3,369		17,954		—		152,610
Goodwill		—		6,160		68,510		42,356		—		117,026
Intangible assets, net		—		78		157,270		14,311		—		171,659
Investments in subsidiaries		(109,788)		1,425,622		—		—		(1,315,834)		—
Other assets		—		5,615		959		7,321		(7,200)		6,695
Total assets	$	(89,639)	$	2,181,842	$	1,391,582	$	538,081	$	(1,923,994)	$	2,097,872
LIABILITIES AND SHAREHOLDERS' (DEFICIT) EQUITY
CURRENT LIABILITIES:
Accounts payable	$	15,352	$	509,572	$	82,337	$	60,799	$	(490,680)	$	177,380
Accrued expenses and other current liabilities		2,627		111,617		129,420		135,777		(110,280)		269,161
Current portion of long-term debt		—		13,379		—		—		—		13,379
Total current liabilities		17,979		634,568		211,757		196,576		(600,960)		459,920
Long-term debt, net		—		1,582,150		—		—		—		1,582,150
Deferred taxes, net and other liabilities		—		74,912		85,477		10,231		(7,200)		163,420
Shareholders' (deficit) equity		(107,618)		(109,788)		1,094,348		331,274		(1,315,834)		(107,618)
Total liabilities and shareholders' (deficit) equity	$	(89,639)	$	2,181,842	$	1,391,582	$	538,081	$	(1,923,994)	$	2,097,872

Condensed Consolidating Statement of Earnings (Loss)

	Tailored		The Men’s		Guarantor		Non-Guarantor
	Brands, Inc.		Wearhouse, Inc.		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Three Months Ended October 28, 2017
Net sales	$	—	$	447,936	$	404,531	$	242,893	$	(284,542)	$	810,818
Cost of sales		—		227,612		317,262		191,729		(284,542)		452,061
Gross margin		—		220,324		87,269		51,164		—		358,757
Operating expenses		917		135,740		134,433		27,465		(16,425)		282,130
Operating (loss) income		(917)		84,584		(47,164)		23,699		16,425		76,627
Other income and expenses, net		—		—		16,425		—		(16,425)		—
Interest expense, net		(129)		(27,789)		1,543		2,122		—		(24,253)
Gain on extinguishment of debt, net		—		2,539		—		—		—		2,539
(Loss) earnings before income taxes		(1,046)		59,334		(29,196)		25,821		—		54,913
(Benefit) provision for income taxes		(337)		19,267		(9,441)		8,532		—		18,021
(Loss) earnings before equity in net income of subsidiaries		(709)		40,067		(19,755)		17,289		—		36,892
Equity in earnings (loss) of subsidiaries		37,601		(2,466)		—		—		(35,135)		—
Net earnings (loss)	$	36,892	$	37,601	$	(19,755)	$	17,289	$	(35,135)	$	36,892
Comprehensive income (loss)	$	33,745	$	39,114	$	(19,755)	$	12,629	$	(31,988)	$	33,745
Three Months Ended October 29, 2016
Net sales	$	—	$	460,432	$	466,476	$	105,474	$	(185,448)	$	846,934
Cost of sales		—		230,110		361,117		63,949		(185,448)		469,728
Gross margin		—		230,322		105,359		41,525		—		377,206
Operating expenses		974		146,398		153,439		29,662		(14,323)		316,150
Operating (loss) income		(974)		83,924		(48,080)		11,863		14,323		61,056
Other income and expenses, net		—		—		14,323		—		(14,323)		—
Interest expense, net		(8)		(25,830)		517		(103)		—		(25,424)
Gain on extinguishment of debt, net		—		1,808		—		—		—		1,808
(Loss) earnings before income taxes		(982)		59,902		(33,240)		11,760		—		37,440
(Benefit) provision for income taxes		(247)		14,763		(8,119)		2,610		—		9,007
(Loss) earnings before equity in net income of subsidiaries		(735)		45,139		(25,121)		9,150		—		28,433
Equity in earnings (loss) of subsidiaries		29,168		(15,971)		—		—		(13,197)		—
Net earnings (loss)	$	28,433	$	29,168	$	(25,121)	$	9,150	$	(13,197)	$	28,433
Comprehensive income (loss)	$	14,306	$	30,116	$	(25,121)	$	(5,925)	$	930	$	14,306

Tailored Brands, Inc.

Condensed Consolidating Statement of Earnings (Loss)

(in thousands)

	Tailored		The Men’s		Guarantor		Non-Guarantor
	Brands, Inc.		Wearhouse, Inc.		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Nine Months Ended October 28, 2017
Net sales	$	—	$	1,324,731	$	1,146,271	$	513,276	$	(539,796)	$	2,444,482
Cost of sales		—		648,900		860,944		386,541		(539,796)		1,356,589
Gross margin		—		675,831		285,327		126,735		—		1,087,893
Operating expenses		2,599		425,912		405,988		82,321		(45,021)		871,799
Operating (loss) income		(2,599)		249,919		(120,661)		44,414		45,021		216,094
Other income and expenses, net		—		—		45,295		(274)		(45,021)		—
Interest expense, net		223		(79,010)		4,804		(893)		—		(74,876)
Gain on extinguishment of debt, net		—		6,535		—		—		—		6,535
(Loss) earnings before income taxes		(2,376)		177,444		(70,562)		43,247		—		147,753
Provision (benefit) for income taxes		1,441		57,951		(23,398)		14,557		—		50,551
(Loss) earnings before equity in net income of subsidiaries		(3,817)		119,493		(47,164)		28,690		—		97,202
Equity in earnings (loss) of subsidiaries		101,019		(18,474)		—		—		(82,545)		—
Net earnings (loss)	$	97,202	$	101,019	$	(47,164)	$	28,690	$	(82,545)	$	97,202
Comprehensive (loss) income	$	105,957	$	100,578	$	(47,164)	$	37,886	$	(91,300)	$	105,957
Nine Months Ended October 29, 2016
Net sales	$	—	$	1,382,515	$	1,300,852	$	315,060	$	(412,987)	$	2,585,440
Cost of sales		—		676,761		992,265		190,050		(412,987)		1,446,089
Gross margin		—		705,754		308,587		125,010		—		1,139,351
Operating expenses		2,554		452,661		486,419		88,958		(42,923)		987,669
Operating (loss) income		(2,554)		253,093		(177,832)		36,052		42,923		151,682
Other income and expenses, net		—		—		42,923		—		(42,923)		—
Interest expense, net		(11)		(78,862)		1,393		(271)		—		(77,751)
Gain on extinguishment of debt, net		—		1,737		—		—		—		1,737
(Loss) earnings before income taxes		(2,565)		175,968		(133,516)		35,781		—		75,668
(Benefit) provision for income taxes		(671)		46,915		(34,900)		9,279		—		20,623
(Loss) earnings before equity in net income of subsidiaries		(1,894)		129,053		(98,616)		26,502		—		55,045
Equity in earnings (loss) of subsidiaries		56,939		(72,114)		—		—		15,175		—
Net earnings (loss)		55,045		56,939		(98,616)		26,502		15,175		55,045
Comprehensive income (loss)	$	38,193	$	58,333	$	(98,616)	$	8,256	$	32,027	$	38,193

Condensed Consolidating Statement of Cash Flows

Tailored Brands, Inc.

Condensed Consolidating Statement of Cash Flows

For the Nine Months Ended October 28, 2017

(in thousands)

	Tailored		The Men’s		Guarantor		Non-Guarantor
	Brands, Inc.		Wearhouse, Inc.		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Net cash provided by (used in) operating activities	$	27,243	$	404,404	$	34,049	$	(186,263)	$	(26,895)	$	252,538
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures		—		(15,413)		(36,146)		(4,397)		—		(55,956)
Acquisition of business, net of cash		—		—		—		(457)		—		(457)
Intercompany activities		—		(223,800)		—		—		223,800		—
Proceeds from sale of property and equipment		—		—		2,157		—		—		2,157
Net cash used in investing activities		—		(239,213)		(33,989)		(4,854)		223,800		(54,256)
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on term loan		—		(9,879)		—		—		—		(9,879)
Proceeds from asset-based revolving credit facility		—		235,900		—		—		—		235,900
Payments on asset-based revolving credit facility		—		(235,900)		—		—		—		(235,900)
Repurchase and retirement of senior notes		—		(106,731)		—		—		—		(106,731)
Deferred financing costs		—		(2,464)		—		—		—		(2,464)
Intercompany activities		—		(26,895)		—		223,800		(196,905)		—
Cash dividends paid		(26,895)		—		—		—		—		(26,895)
Proceeds from issuance of common stock		1,334		—		—		—		—		1,334
Tax payments related to vested deferred stock units		(1,682)		—		—		—		—		(1,682)
Net cash (used in) provided by financing activities		(27,243)		(145,969)		—		223,800		(196,905)		(146,317)
Effect of exchange rate changes		—		—		—		3,390		—		3,390
Increase in cash and cash equivalents		—		19,222		60		36,073		—		55,355
Cash and cash equivalents at beginning of period		—		1,002		1,881		68,006		—		70,889
Cash and cash equivalents at end of period	$	—	$	20,224	$	1,941	$	104,079	$	—	$	126,244

Tailored Brands, Inc.

Condensed Consolidating Statement of Cash Flows

For the Nine Months Ended October 29, 2016

(in thousands)

	Tailored		The Men’s		Guarantor		Non-Guarantor
	Brands, Inc.		Wearhouse, Inc.		Subsidiaries		Subsidiaries		Eliminations		Consolidated
Net cash provided by (used in) operating activities	$	26,245	$	153,072	$	36,198	$	(12,193)	$	(26,438)	$	176,884
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures		—		(40,273)		(37,055)		(3,222)		—		(80,550)
Intercompany activities		—		(19,025)		—		—		19,025		—
Proceeds from sale of property and equipment		—		—		598		7		—		605
Net cash used in investing activities		—		(59,298)		(36,457)		(3,215)		19,025		(79,945)
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on term loan		—		(40,701)		—		—		—		(40,701)
Proceeds from asset-based revolving credit facility		—		517,500		—		3,050		—		520,550
Payments on asset-based revolving credit facility		—		(517,500)		—		(3,050)		—		(520,550)
Repurchase and retirement of senior notes		—		(21,924)		—		—		—		(21,924)
Intercompany activities		—		(26,438)		—		19,025		7,413		—
Cash dividends paid		(26,438)		—		—		—		—		(26,438)
Proceeds from issuance of common stock		1,451		—		—		—		—		1,451
Tax payments related to vested deferred stock units		(1,258)		—		—		—		—		(1,258)
Net cash (used in) provided by financing activities		(26,245)		(89,063)		—		19,025		7,413		(88,870)
Effect of exchange rate changes		—		—		—		(3,101)		—		(3,101)
Increase (decrease) in cash and cash equivalents		—		4,711		(259)		516		—		4,968
Cash and cash equivalents at beginning of period		—		724		2,243		27,013		—		29,980
Cash and cash equivalents at end of period	$	—	$	5,435	$	1,984	$	27,529	$	—	$	34,948