##### 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 August 2, 2008.
 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
(State or other jurisdiction of incorporation or organization)
    
    36-3189198
(I.R.S. Employer
Identification
Number)500 Hanover Pike, Hampstead, MD
(Address of Principal Executive Offices)
    
    21074-2095
(Zip Code)
 410-239-2700
 None
  þ 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 August 27, 2008Common Stock, $.01 par value
    
    18,184,371




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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 Six Months ended August 4, 2007 and 
August 2, 2008
    
    
    3Condensed Consolidated Balance Sheets  as of February 2, 2008 and August 2, 2008
    
    
    4Condensed Consolidated Statements of Cash Flows  Six Months ended August 4, 2007 and August 2, 2008
    
    
    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
    
    
    20Item 4. Controls and Procedures
    
    
    20Part II. Other Information
    
    
    20Item 1. Legal Proceedings
    
    
    20Item 1A. Risk Factors
    
    
    22Item 4. Submission of Matters to a Vote of Security Holders
    
    
    22Item 6. Exhibits
    
    
    23Signature
    
    
    23Exhibit Index
    
    
    24Exhibit 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
    
    
    Six Months EndedAugust 4, 2007
    
    
    August 2, 2008
    
    
    August 4, 2007
    
    
    August 2, 2008Net sales
    
    $
    134,278
    
    
    $
    152,734
    
    
    $
    263,811
    
    
    $
    298,138Cost of goods sold
    
    
    50,531
    
    
    
    57,496
    
    
    
    98,984
    
    
    
    111,920Gross Profit
    
    
    83,747
    
    
    
    95,238
    
    
    
    164,827
    
    
    
    186,218Operating expenses:Sales and marketing
    
    
    57,494
    
    
    
    66,629
    
    
    
    111,553
    
    
    
    127,564General and administrative
    
    
    12,737
    
    
    
    13,831
    
    
    
    25,956
    
    
    
    27,038Total operating expenses
    
    
    70,231
    
    
    
    80,460
    
    
    
    137,509
    
    
    
    154,602Operating income
    
    
    13,516
    
    
    
    14,778
    
    
    
    27,318
    
    
    
    31,616Other income (expense):Interest income
    
    
    540
    
    
    
    321
    
    
    
    978
    
    
    
    624Interest expense
    
    
    (92
    )
    
    
    (92
    )
    
    
    (193
    )
    
    
    (186
    )Total other income
    
    
    448
    
    
    
    229
    
    
    
    785
    
    
    
    438Income before provision for income taxes
    
    
    13,964
    
    
    
    15,007
    
    
    
    28,103
    
    
    
    32,054Provision for income taxes
    
    
    5,758
    
    
    
    6,138
    
    
    
    11,539
    
    
    
    13,354Net income
    
    $
    8,206
    
    
    $
    8,869
    
    
    $
    16,564
    
    
    $
    18,700Earnings per share:Net income per share:Basic
    
    $
    0.45
    
    
    $
    0.49
    
    
    $
    0.92
    
    
    $
    1.03Diluted
    
    $
    0.44
    
    
    $
    0.48
    
    
    $
    0.90
    
    
    $
    1.02Weighted average shares outstanding:Basic
    
    
    18,127
    
    
    
    18,184
    
    
    
    18,085
    
    
    
    18,184Diluted
    
    
    18,444
    
    
    
    18,427
    
    
    
    18,410
    
    
    
    18,420
   3




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JOS. A. BANK CLOTHIERS, INC. AND SUBSIDIARIES
 
 Condensed Consolidated Balance Sheets
   February 2, 2008
    
    
    August 2, 2008ASSETSCURRENT ASSETS:Cash and cash equivalents
    
    $
    82,082
    
    
    $
    64,357Accounts receivable, net
    
    
    5,855
    
    
    
    8,826Inventories:Finished goods
    
    
    196,547
    
    
    
    206,147Raw materials
    
    
    10,278
    
    
    
    13,390Total inventories
    
    
    206,825
    
    
    
    219,537Prepaid expenses and other current assets
    
    
    18,593
    
    
    
    19,347Total current assets
    
    
    313,355
    
    
    
    312,067NONCURRENT ASSETS:Property, plant and equipment, net
    
    
    126,235
    
    
    
    134,111Other noncurrent assets
    
    
    508
    
    
    
    526Total assets
    
    $
    440,098
    
    
    $
    446,704LIABILITIES AND STOCKHOLDERS EQUITYCURRENT LIABILITIES:Accounts payable
    
    $
    47,383
    
    
    $
    46,767Accrued expenses
    
    
    72,150
    
    
    
    57,186Deferred tax liability  current
    
    
    6,688
    
    
    
    7,194Total current liabilities
    
    
    126,221
    
    
    
    111,147NONCURRENT LIABILITIES:Long-term debt
    
    
    
    
    
    
    Noncurrent lease obligations
    
    
    50,185
    
    
    
    52,946Deferred tax liability  noncurrent
    
    
    1,210
    
    
    
    986Other noncurrent liabilities
    
    
    1,317
    
    
    
    1,641Total liabilities
    
    
    178,933
    
    
    
    166,720COMMITMENTS AND CONTINGENCIESSTOCKHOLDERS EQUITY:Common stock
    
    
    181
    
    
    
    181Additional paid-in capital
    
    
    80,791
    
    
    
    80,910Retained earnings
    
    
    180,260
    
    
    
    198,960Accumulated other comprehensive losses
    
    
    (67
    )
    
    
    (67
    )Total stockholders equity
    
    
    261,165
    
    
    
    279,984Total liabilities and
stockholders equity
    
    $
    440,098
    
    
    $
    446,704
   4




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JOS. A. BANK CLOTHIERS, INC. AND SUBSIDIARIES
 
 Condensed Consolidated Statements of Cash Flows
   Six Months EndedAugust 4, 2007
    
    
    August 2, 2008Cash flows from operating activities:Net income
    
    $
    16,564
    
    
    $
    18,700Adjustments to reconcile net income to net cash provided by
operating activities:Depreciation and amortization
    
    
    9,043
    
    
    
    10,049Loss on disposals of property, plant and equipment
    
    
    107
    
    
    
    201(Decrease) increase in deferred taxes
    
    
    (593
    )
    
    
    282Net increase in operating working capital and other components
    
    
    (15,453
    )
    
    
    (28,940
    )Net cash provided by operating activities
    
    
    9,668
    
    
    
    292Cash flows from investing activities:Capital expenditures
    
    
    (11,526
    )
    
    
    (18,136
    )Net cash used in investing activities
    
    
    (11,526
    )
    
    
    (18,136
    )Cash flows from financing activities:Income tax benefit from exercise of stock options
    
    
    625
    
    
    
    Net proceeds from exercise of stock options
    
    
    1,460
    
    
    
    119Net cash provided by financing activities
    
    
    2,085
    
    
    
    119Net increase (decrease) in cash and cash equivalents
    
    
    227
    
    
    
    (17,725
    )Cash and cash equivalents  beginning of period
    
    
    43,080
    
    
    
    82,082Cash and cash equivalents  end of period
    
    $
    43,307
    
    
    $
    64,357
   5




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JOS. A. BANK CLOTHIERS, INC. AND SUBSIDIARIES
 
 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
   1.
    
    BASIS OF PRESENTATION
    Fiscal year 2002
    
    February 1, 2003Fiscal year 2003
    
    January 31, 2004Fiscal 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, 2010
  Reclassifications
 2.
    
    SIGNIFICANT ACCOUNTING POLICIES
 Inventories
  6




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Vendor Rebates
 Landlord Contributions
 Recently Issued Accounting Standards
    7




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3.
    
    SUPPLEMENTAL CASH FLOW DISCLOSURE
  Six Months EndedAugust 4, 2007
    
    
    August 2, 2008Increase in accounts receivable
    
    $
    (1,265
    )
    
    $
    (2,971
    )Increase in inventories
    
    
    (12,086
    )
    
    
    (12,712
    )Decrease (increase) in prepaids and other assets
    
    
    1,441
    
    
    
    (772
    )Increase (decrease) in accounts payable
    
    
    6,233
    
    
    
    (616
    )Decrease in accrued expenses and other liabilities
    
    
    (11,858
    )
    
    
    (14,954
    )Increase in noncurrent lease liabilities and other noncurrent
liabilities
    
    
    2,082
    
    
    
    3,085Net increase in operating working capital and other components
    
    $
    (15,453
    )
    
    $
    (28,940
    )
  Six Months EndedAugust 4, 2007
    
    
    August 2, 2008Interest paid
    
    $
    192
    
    
    $
    132Income taxes paid
    
    $
    24,443
    
    
    $
    28,818
 4.
    
    EARNINGS PER SHARE
  Three Months Ended
    
    
    Six Months EndedAugust 4, 2007
    
    
    August 2, 2008
    
    
    August 4, 2007
    
    
    August 2, 2008Weighted average shares
outstanding for basic EPS
    
    
    18,127
    
    
    
    18,184
    
    
    
    18,085
    
    
    
    18,184Dilutive effect of common stock
equivalents
    
    
    317
    
    
    
    243
    
    
    
    325
    
    
    
    236Weighted average shares
outstanding for diluted EPS
    
    
    18,444
    
    
    
    18,427
    
    
    
    18,410
    
    
    
    18,420
   8




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5.
    
    INCOME TAXES
      6.
    
    SEGMENT REPORTING
    9




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##### Table of Contents



Three months ended August 2, 2008
 Stores
    
    
    Direct Marketing
    
    
    Other
    
    
    TotalNet sales (a)
    
    $
    135,162
    
    
    $
    14,909
    
    
    $
    2,663
    
    
    $
    152,734Depreciation and amortization
    
    
    4,512
    
    
    
    20
    
    
    
    607
    
    
    
    5,139Operating income (loss)(b)
    
    
    22,870
    
    
    
    5,779
    
    
    
    (13,871
    )
    
    
    14,778Capital expenditures (d)
    
    
    9,949
    
    
    
    2
    
    
    
    236
    
    
    
    10,187
 Three months ended August 4, 2007
 Stores
    
    
    Direct Marketing
    
    
    Other
    
    
    TotalNet sales (a)
    
    $
    117,918
    
    
    $
    13,533
    
    
    $
    2,827
    
    
    $
    134,278Depreciation and amortization
    
    
    3,931
    
    
    
    18
    
    
    
    614
    
    
    
    4,563Operating income (loss)
(b)
    
    
    21,772
    
    
    
    5,040
    
    
    
    (13,296
    )
    
    
    13,516Capital expenditures (d)
    
    
    3,932
    
    
    
    8
    
    
    
    248
    
    
    
    4,188
 Six months ended August 2, 2008
 Stores
    
    
    Direct Marketing
    
    
    Other
    
    
    TotalNet sales (a)
    
    $
    264,204
    
    
    $
    28,676
    
    
    $
    5,258
    
    
    $
    298,138Depreciation and amortization
    
    
    8,794
    
    
    
    40
    
    
    
    1,215
    
    
    
    10,049Operating income (loss)
(b)
    
    
    47,814
    
    
    
    11,651
    
    
    
    (27,849
    )
    
    
    31,616Identifiable assets (c)
    
    
    390,267
    
    
    
    43,290
    
    
    
    13,147
    
    
    
    446,704Capital expenditures (d)
    
    
    17,656
    
    
    
    5
    
    
    
    475
    
    
    
    18,136
 Six months ended August 4, 2007
 Stores
    
    
    Direct Marketing
    
    
    Other
    
    
    TotalNet sales (a)
    
    $
    230,996
    
    
    $
    27,489
    
    
    $
    5,326
    
    
    $
    263,811Depreciation and amortization
    
    
    7,777
    
    
    
    38
    
    
    
    1,228
    
    
    
    9,043Operating income (loss)
(b)
    
    
    43,890
    
    
    
    10,647
    
    
    
    (27,219
    )
    
    
    27,318Identifiable assets (c)
    
    
    326,553
    
    
    
    40,655
    
    
    
    13,586
    
    
    
    380,794Capital expenditures (d)
    
    
    11,057
    
    
    
    21
    
    
    
    448
    
    
    
    11,526
  10




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##### Table of Contents



(a)
    
    Direct Marketing net sales represent catalog and Internet sales. Net sales from segments
below the 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. 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)
    
    Identifiable assets include cash and cash equivalents, accounts receivable, inventories,
prepaid expenses and other current assets and property, plant and equipment residing in or
related to the reportable segment. Assets included in Other are primarily cash and cash
equivalents, property, plant and equipment associated with the corporate office and
distribution centers, other noncurrent assets and inventories which have not been assigned
to one of the reportable segments.(d)
    
    Capital expenditures include purchases of property, plant and equipment made for the
reportable segment. 7.
    
    LEGAL MATTERS
      11




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12




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Item 2.
    Managements Discussion and Analysis of Financial Condition and Results of Operations
  Overview
 
    
    13.7% increase in net sales, generated by both the Stores and the Direct
Marketing segments, while maintaining gross profit margins;
    
    6.8% increase in comparable store sales;
    
    a 80 basis point increase in sales and marketing costs as a percentage of sales
driven primarily by payroll and other variable selling costs (particularly shipping
costs to customers), partially offset by the leveraging of occupancy costs; and
    
    a 40 basis point decrease in general and administrative costs as a percentage
of sales as the Company was able to leverage its costs during the quarter.
   Critical Accounting Policies and Estimates
 Inventory.
  13




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Asset Valuation.
 Lease Accounting.
  Recently Issued Accounting Standards 
  14




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Results of Operations
  Percentage of Net Sales
    
    
    Percentage of Net SalesThree Months Ended
    
    
    Six Months EndedAugust 4, 2007
    
    
    August 2, 2008
    
    
    August 4, 2007
    
    
    August 2, 2008Net sales
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %Cost of goods sold
    
    
    37.6
    
    
    
    37.6
    
    
    
    37.5
    
    
    
    37.5Gross profit
    
    
    62.4
    
    
    
    62.4
    
    
    
    62.5
    
    
    
    62.5Sales and marketing
expenses
    
    
    42.8
    
    
    
    43.6
    
    
    
    42.3
    
    
    
    42.8General and
administrative expenses
    
    
    9.5
    
    
    
    9.1
    
    
    
    9.8
    
    
    
    9.1Total operating expenses
    
    
    52.3
    
    
    
    52.7
    
    
    
    52.1
    
    
    
    51.9Operating income
    
    
    10.1
    
    
    
    9.7
    
    
    
    10.4
    
    
    
    10.6Total other income
    
    
    0.3
    
    
    
    0.1
    
    
    
    0.3
    
    
    
    0.1Income before provision
for income taxes
    
    
    10.4
    
    
    
    9.8
    
    
    
    10.7
    
    
    
    10.8Provision for income
taxes
    
    
    4.3
    
    
    
    4.0
    
    
    
    4.4
    
    
    
    4.5Net income
    
    
    6.1
    
    
    
    5.8
    
    
    
    6.3
    
    
    
    6.3
 Net Sales
  15




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Three Months Ended
    
    
    Six Months EndedAugust 4, 2007
    
    
    August 2, 2008
    
    
    August 4, 2007
    
    
    August 2, 2008Square
    
    
    
    
    
    
    Square
    
    
    
    
    
    
    Square
    
    
    
    
    
    
    SquareStores
    
    
    Feet*
    
    
    Stores
    
    
    Feet*
    
    
    Stores
    
    
    Feet*
    
    
    Stores
    
    
    Feet*Stores open at the
beginning of the
period
    
    
    385
    
    
    
    1,779
    
    
    
    428
    
    
    
    1,961
    
    
    
    376
    
    
    
    1,745
    
    
    
    422
    
    
    
    1,935Stores opened
    
    
    6
    
    
    
    25
    
    
    
    16
    
    
    
    63
    
    
    
    16
    
    
    
    67
    
    
    
    22
    
    
    
    89Stores closed
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1
    )
    
    
    (8
    )
    
    
    
    
    
    
    Stores open at the
end of the period
    
    
    391
    
    
    
    1,804
    
    
    
    444
    
    
    
    2,024
    
    
    
    391
    
    
    
    1,804
    
    
    
    444
    
    
    
    2,024
 
 *
    
    Square feet is presented in thousands and excludes the square footage of the Companys
franchise stores. Square feet amounts reflect reductions to square footage due to renovations
or relocations. Gross profit
  Sales and Marketing Expenses
   16




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General and Administrative Expenses
 Other Income (Expense)
 Income Taxes
 Seasonality
 Liquidity and Capital Resources
   17




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Six Months EndedAugust 4, 2007
    
    
    August 2, 2008Cash provided by (used in):Operating activities
    
    $
    9,668
    
    
    $
    292Investing activities
    
    
    (11,526
    )
    
    
    (18,136
    )Financing activities
    
    
    2,085
    
    
    
    119Net increase (decrease) in cash and cash equivalents
    
    $
    227
    
    
    $
    (17,725
    )
    Off-Balance Sheet Arrangements
  18




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Disclosures about Contractual Obligations and Commercial Commitments
   Payments Due by Fiscal Year(in thousands)Beyond2008
    
    
    2009-2011
    
    
    2012-2013
    
    
    2013
    
    
    Total (d)Long-term debt
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    Operating leases (a) (b)
    
    
    50,629
    
    
    
    150,264
    
    
    
    87,791
    
    
    
    92,100
    
    
    
    380,784Stand-by letter-of-credit (c)
    
    
    
    
    
    
    400
    
    
    
    
    
    
    
    
    
    
    
    400License agreement
    
    
    165
    
    
    
    330
    
    
    
    
    
    
    
    
    
    
    
    495
 
 (a)
    
    Includes various lease agreements for stores to be opened and equipment placed in
service subsequent to
August 2, 2008. See Note 9 to the Consolidated Financial Statements in the Companys
Annual Report on Form 10-K for fiscal year 2007.(b)
    
    Excludes contingent rent and other lease costs.(c)
    
    To secure the payment of rent at one leased location included in Operating Leases
above and is renewable each year through the end of the lease term (2009).(d)
    
    Obligations related to unrecognized tax benefits of $0.3 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,
   19




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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
 
 PART II. OTHER INFORMATION
 
 Item 1. Legal Proceedings
   20




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21




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Item 1A. Risk Factors
  
 Item 4. Submission of Matters to a Vote of Security Holders
  a)
    
    The 2008 annual meeting of shareholders of the Company was held on June 19,
2008.b)
    
    Robert N. Wildrick was elected director at the meeting. Andrew A. Giordano,
Gary S. Gladstein, William E. Herron and Sidney H. Ritman continued in their respective
terms of office as directors.c)
    
    The matters voted upon at the meeting and the votes were as follows:
 1.
    
    Election of Director(a):
 For
    
    
    WithheldRobert N. Wildrick
    
    
    8,861,360
    
    
    
    7,991,087
 2.
    
    Ratification of selection of Deloitte and Touche, LLP as the
Companys independent public accountants for the fiscal year ending January 31,
2009(b):
 For
    
    
    Against
    
    
    Abstaining16,484,156
    
    
    334,817
    
    
    
    33,474
 
 (a)
    
    There were no abstentions or broker non-votes in the election of the director.(b)
    
    There were no broker non-votes in the ratification of selection of Deloitte and
Touche, LLP as the Companys independent public accountants for the fiscal year ending
January 31, 2009.  22




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Item 6. Exhibits
 Exhibits31.1
    
    
    Certification of Principal Executive Officer pursuant to Rule 13a-14 or 15d-14(a).31.2
    
    
    Certification of Principal Financial Officer pursuant to Rule 13a-14 or 15d-14(a).32.1
    
    
    Certification by Principal Executive Officer pursuant to 18 U.S.C. Section 1350,
as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.32.2
    
    
    Certification by Principal Financial Officer pursuant to 18 U.S.C. Section 1350,
as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
 
 SIGNATURE
  Dated:  September 3, 2008
    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)  23




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##### Table of Contents



Exhibit Index
 Exhibits31.1
    
    
    Certification of Principal Executive Officer pursuant to Rule 13a-14 or 15d-14(a).31.2
    
    
    Certification of Principal Financial Officer pursuant to Rule 13a-14 or 15d-14(a).32.1
    
    
    Certification by Principal Executive Officer pursuant to 18 U.S.C. Section 1350,
as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.32.2
    
    
    Certification by Principal Financial Officer pursuant to 18 U.S.C. Section 1350,
as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
  24