##### Table of Contents



United States Securities and Exchange Commission
 Washington, DC 20549
 FORM 10-Q
 þ
    
    Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 For the quarterly period ended October 31, 2009.
 or
 o
    
    Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 Commission File Number 0-23874
 Jos. A. Bank Clothiers, Inc.
  Delaware
    
    36-3189198(State or other jurisdiction of incorporation or organization)
    
    (I.R.S. EmployerIdentification Number)500 Hanover Pike, Hampstead, MD
    
    21074-2095(Address of Principal Executive Offices)
    
    (Zip Code)
 410-239-2700
 None
 þ o
 o o
  Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer o
(Do not check if smaller reporting company)
    
    Smaller reporting company o
 o þ
  Class
    
    Outstanding as of November 25, 2009Common Stock, $.01 par value
    
    18,294,883




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##### 



JOS. A. BANK CLOTHIERS, INC. AND SUBSIDIARIES
 Index
 Page No.Part I. Financial InformationItem 1. Unaudited Condensed Consolidated Financial Statements
    
    
    3Condensed Consolidated Statements of Income  Three and Nine Months ended
November 1, 2008 and October 31, 2009
    
    
    3Condensed Consolidated Balance Sheets  as of January 31, 2009 and October 31, 2009
    
    
    4Condensed Consolidated Statements of Cash Flows  Nine Months ended
November 1, 2008 and October 31, 2009
    
    
    5Notes to Condensed Consolidated Financial Statements
    
    
    6Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    13Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    22Item 4. Controls and Procedures
    
    
    22Part II. Other Information
    
    
    23Item 1. Legal Proceedings
    
    
    23Item 1A. Risk Factors
    
    
    24Item 6. Exhibits
    
    
    24Signature
    
    
    24Exhibit Index
    
    
    25Exhibit 31.1Exhibit 31.2Exhibit 32.1Exhibit 32.2
   2




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##### Table of Contents



PART I. FINANCIAL INFORMATION
 
 Item 1.
    
    Unaudited Condensed Consolidated Financial Statements
 JOS. A. BANK CLOTHIERS, INC. AND SUBSIDIARIES
 
 Condensed Consolidated Statements of Income
   Three Months Ended
    
    
    Nine Months EndedNovember 1,
    
    
    October 31,
    
    
    November 1,
    
    
    October 31,2008
    
    
    2009
    
    
    2008
    
    
    2009Net sales
    
    $
    149,274
    
    
    $
    161,309
    
    
    $
    447,412
    
    
    $
    490,969Cost of goods sold
    
    
    54,980
    
    
    
    60,502
    
    
    
    166,900
    
    
    
    188,531Gross profit
    
    
    94,294
    
    
    
    100,807
    
    
    
    280,512
    
    
    
    302,438Operating expenses:Sales and marketing,
including occupancy costs
    
    
    66,209
    
    
    
    67,450
    
    
    
    193,773
    
    
    
    200,079General and administrative
    
    
    14,231
    
    
    
    14,043
    
    
    
    41,269
    
    
    
    43,514Total operating expenses
    
    
    80,440
    
    
    
    81,493
    
    
    
    235,042
    
    
    
    243,593Operating income
    
    
    13,854
    
    
    
    19,314
    
    
    
    45,470
    
    
    
    58,845Other income (expense):Interest income
    
    
    169
    
    
    
    101
    
    
    
    793
    
    
    
    262Interest expense
    
    
    (103
    )
    
    
    (93
    )
    
    
    (289
    )
    
    
    (301
    )Total other income (expense)
    
    
    66
    
    
    
    8
    
    
    
    504
    
    
    
    (39
    )Income before provision for income taxes
    
    
    13,920
    
    
    
    19,322
    
    
    
    45,974
    
    
    
    58,806Provision for income taxes
    
    
    4,621
    
    
    
    7,594
    
    
    
    17,975
    
    
    
    23,111Net income
    
    $
    9,299
    
    
    $
    11,728
    
    
    $
    27,999
    
    
    $
    35,695Per share information:Earnings per share:Basic
    
    $
    0.51
    
    
    $
    0.64
    
    
    $
    1.54
    
    
    $
    1.95Diluted
    
    $
    0.50
    
    
    $
    0.63
    
    
    $
    1.52
    
    
    $
    1.93Weighted average shares outstanding:Basic
    
    
    18,215
    
    
    
    18,292
    
    
    
    18,194
    
    
    
    18,291Diluted
    
    
    18,461
    
    
    
    18,532
    
    
    
    18,433
    
    
    
    18,518
   3




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JOS. A. BANK CLOTHIERS, INC. AND SUBSIDIARIES


Condensed Consolidated Balance Sheets
 January 31,
    
    
    October 31,2009
    
    
    2009(Audited)
    
    
    (Unaudited)ASSETSCURRENT ASSETS:Cash and cash equivalents
    
    $
    122,875
    
    
    $
    41,914Short-term investments
    
    
    
    
    
    
    64,879Accounts receivable, net
    
    
    7,404
    
    
    
    13,253Inventories:Finished goods
    
    
    199,886
    
    
    
    241,705Raw materials
    
    
    9,356
    
    
    
    10,149Total inventories
    
    
    209,242
    
    
    
    251,854Prepaid expenses and other current assets
    
    
    17,776
    
    
    
    17,557Total current assets
    
    
    357,297
    
    
    
    389,457NONCURRENT ASSETS:Property, plant and equipment, net
    
    
    133,588
    
    
    
    128,439Other noncurrent assets
    
    
    481
    
    
    
    746Total assets
    
    $
    491,366
    
    
    $
    518,642LIABILITIES AND STOCKHOLDERS EQUITYCURRENT LIABILITIES:Accounts payable
    
    $
    29,774
    
    
    $
    33,695Accrued expenses
    
    
    74,792
    
    
    
    63,901Deferred tax liability  current
    
    
    6,604
    
    
    
    6,760Total current liabilities
    
    
    111,170
    
    
    
    104,356NONCURRENT LIABILITIES:Deferred rent
    
    
    54,743
    
    
    
    53,259Deferred tax liability  noncurrent
    
    
    2,605
    
    
    
    2,249Other noncurrent liabilities
    
    
    1,035
    
    
    
    1,175Total liabilities
    
    
    169,553
    
    
    
    161,039COMMITMENTS AND CONTINGENCIESSTOCKHOLDERS EQUITY:Common stock
    
    
    182
    
    
    
    182Additional paid-in capital
    
    
    82,951
    
    
    
    83,046Retained earnings
    
    
    238,668
    
    
    
    274,363Accumulated other comprehensive income
    
    
    12
    
    
    
    12Total stockholders equity
    
    
    321,813
    
    
    
    357,603Total liabilities and stockholders equity
    
    $
    491,366
    
    
    $
    518,642
   4




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JOS. A. BANK CLOTHIERS, INC. AND SUBSIDIARIES
 
 Condensed Consolidated Statements of Cash Flows
   Nine Months EndedNovember 1,
    
    
    October 31,2008
    
    
    2009Cash flows from operating activities:Net income
    
    $
    27,999
    
    
    $
    35,695Adjustments to reconcile net income to net cash used in
operating activities:Depreciation and amortization
    
    
    15,394
    
    
    
    16,533Loss on disposals of property, plant and equipment
    
    
    227
    
    
    
    120Increase
(decrease) in deferred taxes
    
    
    1,210
    
    
    
    (200
    )Net increase in operating working capital and other components
    
    
    (57,434
    )
    
    
    (57,730
    )Net cash used in operating activities
    
    
    (12,604
    )
    
    
    (5,582
    )Cash flows from investing activities:Capital expenditures
    
    
    (26,888
    )
    
    
    (10,595
    )Proceeds from disposal of fixed assets
    
    
    197
    
    
    
    Purchases of short-term investments
    
    
    
    
    
    
    (64,879
    )Net cash used in investing activities
    
    
    (26,691
    )
    
    
    (75,474
    )Cash flows from financing activities:Income tax benefit from exercise of stock options
    
    
    528
    
    
    
    57Net proceeds from exercise of stock options
    
    
    1,137
    
    
    
    38Net cash provided by financing activities
    
    
    1,665
    
    
    
    95Net decrease in cash and cash equivalents
    
    
    (37,630
    )
    
    
    (80,961
    )Cash and cash equivalents  beginning of period
    
    
    82,082
    
    
    
    122,875Cash and cash equivalents  end of period
    
    $
    44,452
    
    
    $
    41,914
   5




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JOS. A. BANK CLOTHIERS, INC. AND SUBSIDIARIES
 
 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
   1.
    
    BASIS OF PRESENTATION
    Fiscal year 2004
    
    January 29, 2005Fiscal year 2005
    
    January 28, 2006Fiscal year 2006
    
    February 3, 2007Fiscal year 2007
    
    February 2, 2008Fiscal year 2008
    
    January 31, 2009Fiscal year 2009
    
    January 30, 2010Fiscal year 2010
    
    January 29, 2011
   2.
    
    SIGNIFICANT ACCOUNTING POLICIES
 Cash and Cash Equivalents
 Short-term Investments
 Inventories
  6




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Vendor Rebates
 Landlord Contributions
 Recently Issued Accounting Standards
     7




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3.
    
    SUPPLEMENTAL CASH FLOW DISCLOSURE
  Nine Months EndedNovember 1,
    
    
    October 31,2008
    
    
    2009Increase in accounts receivable
    
    $
    (10,272
    )
    
    $
    (5,849
    )Increase in inventories
    
    
    (34,775
    )
    
    
    (42,612
    )Increase in prepaids and other assets
    
    
    (2,396
    )
    
    
    (46
    )Increase (decrease) in accounts payable
    
    
    (3,418
    )
    
    
    3,921Decrease in accrued expenses
    
    
    (11,710
    )
    
    
    (11,800
    )Increase (decrease) in deferred rent and other noncurrent liabilities
    
    
    5,137
    
    
    
    (1,344
    )Net increase in operating working capital and other components
    
    $
    (57,434
    )
    
    $
    (57,730
    )
  Nine Months EndedNovember 1,
    
    
    October 31,2008
    
    
    2009Interest paid
    
    $
    203
    
    
    $
    226Income taxes paid
    
    $
    32,269
    
    
    $
    36,263
 4.
    
    EARNINGS PER SHARE
  Three Months Ended
    
    
    Nine Months EndedNovember 1,
    
    
    October 31,
    
    
    November 1,
    
    
    October 31,2008
    
    
    2009
    
    
    2008
    
    
    2009Weighted average shares
outstanding for basic EPS
    
    
    18,215
    
    
    
    18,292
    
    
    
    18,194
    
    
    
    18,291Dilutive effect of common stock
equivalents
    
    
    246
    
    
    
    240
    
    
    
    239
    
    
    
    227Weighted average shares
outstanding for diluted EPS
    
    
    18,461
    
    
    
    18,532
    
    
    
    18,433
    
    
    
    18,518
   8




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5.
    
    INCOME TAXES
     6.
    
    SEGMENT REPORTING
     9




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##### Table of Contents



Three months ended October 31, 2009
 Stores
    
    
    Direct Marketing
    
    
    Other
    
    
    TotalNet sales (a)
    
    $
    145,759
    
    
    $
    12,618
    
    
    $
    2,932
    
    
    $
    161,309Depreciation and amortization
    
    
    4,928
    
    
    
    76
    
    
    
    633
    
    
    
    5,637Operating income (loss)(b)
    
    
    29,075
    
    
    
    5,262
    
    
    
    (15,023
    )
    
    
    19,314Capital expenditures (c)
    
    
    2,504
    
    
    
    449
    
    
    
    229
    
    
    
    3,182
 Three months ended November 1, 2008
 Stores
    
    
    Direct Marketing
    
    
    Other
    
    
    TotalNet sales (a)
    
    $
    136,084
    
    
    $
    10,408
    
    
    $
    2,782
    
    
    $
    149,274Depreciation and amortization
    
    
    4,723
    
    
    
    17
    
    
    
    605
    
    
    
    5,345Operating income (loss) (b)
    
    
    24,183
    
    
    
    3,989
    
    
    
    (14,318
    )
    
    
    13,854Capital expenditures (c)
    
    
    8,419
    
    
    
    
    
    
    
    333
    
    
    
    8,752
 Nine months ended October 31, 2009
 Stores
    
    
    Direct Marketing
    
    
    Other
    
    
    TotalNet sales (a)
    
    $
    440,570
    
    
    $
    41,961
    
    
    $
    8,438
    
    
    $
    490,969Depreciation and amortization
    
    
    14,532
    
    
    
    96
    
    
    
    1,905
    
    
    
    16,533Operating income (loss) (b)
    
    
    87,431
    
    
    
    17,284
    
    
    
    (45,870
    )
    
    
    58,845Capital expenditures (c)
    
    
    8,404
    
    
    
    1,295
    
    
    
    896
    
    
    
    10,595
 Nine months ended November 1, 2008
 Stores
    
    
    Direct Marketing
    
    
    Other
    
    
    TotalNet sales (a)
    
    $
    400,288
    
    
    $
    39,084
    
    
    $
    8,040
    
    
    $
    447,412Depreciation and amortization
    
    
    13,517
    
    
    
    57
    
    
    
    1,820
    
    
    
    15,394Operating income (loss) (b)
    
    
    71,997
    
    
    
    15,640
    
    
    
    (42,167
    )
    
    
    45,470Capital expenditures (c)
    
    
    26,075
    
    
    
    5
    
    
    
    808
    
    
    
    26,888
 
 (a)
    
    Direct Marketing net sales represent catalog call center and Internet sales. Net sales
from segments below the GAAP quantitative thresholds are attributable primarily to three
operating segments of the Company. Those segments are outlet stores, franchise stores and
regional tailor shops. None of these segments have ever met any of the quantitative
thresholds for determining reportable segments and are included in Other.(b)
    
    Operating income (loss) for the Stores and Direct Marketing segments represents profit
before allocations of overhead from the corporate office and the distribution centers,
interest and income taxes. Total Company shipping costs to customers of approximately $1.4
million and $1.5 million for the third quarter of fiscal years 2008 and 2009, respectively,
and approximately $5.1 million and $5.6 million for the first nine months of fiscal years
2008 and 2009, respectively, which primarily related to the Direct Marketing segment, were
recorded to Sales and marketing, including occupancy costs in the Condensed Consolidated
Statements of Income. Operating income (loss) for Other consists primarily of costs
included in general and administrative costs. Total operating income represents profit
before interest and income taxes.(c)
    
    Capital expenditures include payments for property, plant and equipment made for the
reportable segment.  10




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7.
    
    LEGAL MATTERS
        11




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8.
    

    SUBSEQUENT EVENTS
   12




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Item 2.
    
    Managements Discussion and Analysis of Financial Condition and Results of
Operations
  Overview
  8.1% increase in net sales, driven by a 7.1% increase in the Stores segment and
a 21.2% increase in the Direct Marketing segment, with gross profit margins decreasing
by 70 basis points; 3.3% increase in comparable store sales; 260 basis point decrease in sales and marketing costs as a percentage of sales
driven primarily by the leveraging of occupancy costs, other variable selling costs and
advertising and marketing costs; 80 basis point decrease in general and administrative costs as a percentage of
sales as the Company was able to better leverage its corporate costs during the
quarter; and tax benefits realized during the third quarter of fiscal year 2008 of
approximately $0.9 million or $0.05 per diluted share due to the Companys ability to
fully deduct employee compensation which was previously limited under IRC 162(m) in
addition to a decrease in the liability for unrecognized tax benefits and related
penalties and interest.
     Critical
Accounting Policies and Estimates
  13




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Inventory.
   Asset Valuation.
 Lease Accounting.
   14




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Recently Issued Accounting Standards
     15




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Results of Operations
  Percentage of Net Sales
    
    
    Percentage of Net SalesThree Months Ended
    
    
    Nine Months EndedNovember 1,
    
    
    October 31,
    
    
    November 1,
    
    
    October 31,2008
    
    
    2009
    
    
    2008
    
    
    2009Net sales
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %Cost of goods sold
    
    
    36.8
    
    
    
    37.5
    
    
    
    37.3
    
    
    
    38.4Gross profit
    
    
    63.2
    
    
    
    62.5
    
    
    
    62.7
    
    
    
    61.6Sales and marketing expenses
    
    
    44.4
    
    
    
    41.8
    
    
    
    43.3
    
    
    
    40.8General and administrative expenses
    
    
    9.5
    
    
    
    8.7
    
    
    
    9.2
    
    
    
    8.9Total operating expenses
    
    
    53.9
    
    
    
    50.5
    
    
    
    52.5
    
    
    
    49.6Operating income
    
    
    9.3
    
    
    
    12.0
    
    
    
    10.2
    
    
    
    12.0Total other income
    
    
    
    
    
    
    
    
    
    
    0.1
    
    
    
    Income before provision for income
taxes
    
    
    9.3
    
    
    
    12.0
    
    
    
    10.3
    
    
    
    12.0Provision for income taxes
    
    
    3.1
    
    
    
    4.7
    
    
    
    4.0
    
    
    
    4.7Net income
    
    
    6.2
    %
    
    
    7.3
    %
    
    
    6.3
    %
    
    
    7.3
    %
 Net
Sales
   16




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Three Months Ended
    
    
    Nine Months EndedNovember 1, 2008
    
    
    October 31, 2009
    
    
    November 1, 2008
    
    
    October 31, 2009Square
    
    
    
    
    
    
    Square
    
    
    
    
    
    
    Square
    
    
    
    
    
    
    SquareStores
    
    
    Feet*
    
    
    Stores
    
    
    Feet*
    
    
    Stores
    
    
    Feet*
    
    
    Stores
    
    
    Feet*Stores open at the
beginning of the
period
    
    
    444
    
    
    
    2,024
    
    
    
    467
    
    
    
    2,121
    
    
    
    422
    
    
    
    1,935
    
    
    
    460
    
    
    
    2,091Stores opened
    
    
    16
    
    
    
    68
    
    
    
    3
    
    
    
    10
    
    
    
    38
    
    
    
    157
    
    
    
    10
    
    
    
    40Stores closed
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Stores open at the
end of the period
    
    
    460
    
    
    
    2,092
    
    
    
    470
    
    
    
    2,131
    
    
    
    460
    
    
    
    2,092
    
    
    
    470
    
    
    
    2,131
 
 *
    
    Square feet is presented in thousands and excludes the square footage of the Companys
franchise stores. Gross
profit
  Sales and Marketing Expenses
   17




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General and Administrative Expenses
  Other Income (Expense)
 Income Taxes
 Seasonality
 Liquidity
and Capital Resources
  18




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Nine Months EndedNovember 1,
    
    
    October 31,2008
    
    
    2009Cash provided by (used in):Operating activities
    
    $
    (12,604
    )
    
    $
    (5,582
    )Investing activities
    
    
    (26,691
    )
    
    
    (75,474
    )Financing activities
    
    
    1,665
    
    
    
    95Net decrease in cash and cash equivalents
    
    $
    (37,630
    )
    
    $
    (80,961
    )
     19




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AmountsAmounts
    
    
    Collected
    
    
    AmountsCollected in
    
    
    YTD in
    
    
    OutstandingNegotiated
    
    
    Fiscal Year
    
    
    Fiscal Year
    
    
    October 31,Amounts
    
    
    2008
    
    
    2009
    
    
    2009(in thousands)Full Fiscal Year 2008 Store
Openings (40 Stores)
    
    $
    10,513
    
    
    $
    (6,373
    )
    
    $
    (3,613
    )
    
    $
    527First Nine Months of
Fiscal Year 2009
Store Openings (10 Stores)
    
    
    2,451
    
    
    
    
    
    
    
    (1,898
    )
    
    
    553$
    12,964
    
    
    $
    (6,373
    )
    
    $
    (5,511
    )
    
    $
    1,080
    Off-Balance Sheet Arrangements
 Disclosures about Contractual Obligations and Commercial Commitments
   20




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Payments Due by Fiscal Year(in thousands)Beyond2009
    
    
    2010-2012
    
    
    2013-2014
    
    
    2014
    
    

Total
(e)Operating leases (a) (b)
    
    $
    53,403
    
    
    $
    160,760
    
    
    $
    83,678
    
    
    $
    71,527
    
    
    $
    369,368Standby letter of credit (c)
    
    
    400
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    400Related Party Agreement (d)
    
    
    825
    
    
    
    1,650
    
    
    
    
    
    
    
    
    
    
    
    2,475License agreement
    
    
    165
    
    
    
    495
    
    
    
    330
    
    
    
    330
    
    
    
    1,320
 
 (a)
    
    Includes various lease agreements for stores to be opened and equipment placed in
service subsequent to
October 31, 2009.(b)
    
    Excludes contingent rent and other lease costs.(c)
    
    To secure the payment of rent through November 30, 2009
at one leased location included in Operating Leases.(d)
    
    Relates to consulting agreement with the Companys current Chairman of the Board to
consult on matters of strategic planning and initiatives.(e)
    
    Obligations related to unrecognized tax benefits and related penalties and interest
of $0.8 million have been excluded from the above table as the amount to be settled in
cash and the specific payment dates are not known. Cautionary Statement
 Form 10-Q,
   21




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##### Table of Contents



Item 3.
    
    Quantitative and Qualitative Disclosures About Market Risk
  
 Item 4.
    
    Controls and Procedures
 Limitations on Control Systems.
 Disclosure Controls and Procedures.
  Changes in Internal Control over Financial Reporting
  22




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##### Table of Contents



PART II. OTHER INFORMATION
 
 Item 1.
    
    Legal Proceedings
        23




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##### Table of Contents



Item 1A.
    
    Risk Factors
  
 Item 6.
    
    Exhibits
 Exhibits31.1
    
    
    Certification of Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31.2
    
    
    Certification of Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32.1
    
    
    Certification of Principal Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.32.2
    
    
    Certification of Principal Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
 
 SIGNATURE
  Dated:  December 2, 2009
    Jos. A. Bank Clothiers, Inc.
(Registrant)/s/ David E. UllmanDavid E. UllmanExecutive Vice President,
Chief Financial Officer
(Principal Financial and Accounting Officer and
Duly Authorized Officer)  24




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##### Table of Contents



Exhibit Index
 Exhibits31.1
    
    
    Certification of Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31.2
    
    
    Certification of Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32.1
    
    
    Certification of Principal Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.32.2
    
    
    Certification of Principal Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
  25