- Expects corporate workforce reduction of approximately 20%
of its corporate positions by the end of the fiscal second
quarter
- Up to 500 stores identified for potential closure over
time
- CFO Jack Calandra to depart Tailored Brands and Holly Etlin
appointed as Chief Restructuring Officer
Tailored Brands, Inc. (NYSE: TLRD) today announced that, as a
result of the unprecedented and industrywide business disruptions
resulting from the coronavirus pandemic, it is implementing a
series of operating and organizational changes.
Specifically, the Company will make organizational changes that
will result in the elimination of approximately 20% of its
corporate positions by the end of the fiscal second quarter. In
addition, the Company has identified up to 500 retail stores for
potential closure as well as associated opportunities to reduce and
realign its store organization and supply chain infrastructure and
organization to best serve its go-forward store footprint and
e-commerce business. These changes are designed to strengthen the
Company’s financial position and enable it to compete more
effectively in the challenging retail environment.
Tailored Brands President and CEO Dinesh Lathi said, “We have
safely reopened almost all of our retail stores and look forward to
helping our customers look and feel their best for their moments
that matter. Unfortunately, due to the COVID-19 pandemic and its
significant impact on our business, further actions are needed to
help us strengthen our financial position so we can navigate our
current realities. It is always difficult to eliminate jobs and say
farewell to our friends and colleagues. I want to thank our
teammates affected by these changes as well as those who continue
to help us meet the challenges currently facing our industry and
who remain dedicated to serving our customers.”
Lathi added, “While today’s announcement is a difficult one, we
are confident these are the right next steps to protect our
business and position us to more effectively compete in today’s
environment.”
In connection with these corporate personnel changes, the
Company expects to record a pre-tax charge of approximately $6
million in the second quarter of fiscal 2020 for severance payments
and other termination costs, all of which are cash costs.
Leadership Update
The Company also announced that Jack Calandra, Executive Vice
President, Chief Financial Officer and Treasurer, will leave
Tailored Brands as of July 31. In the near term, Calandra’s
responsibilities will be divided between Lathi and Holly Etlin, a
Managing Director at AlixPartners who has been appointed to the
newly created role of Chief Restructuring Officer, reporting
directly to Lathi. Etlin brings more than 30 years of restructuring
experience and a deep expertise in retail, and has been working
closely with the executive team and Board of Directors as an
advisor since late March.
Lathi said, “Jack and I have been discussing a transition and,
with a full appreciation of both the challenges to be solved and
the opportunities to be realized in the next phase of the Company’s
journey, we both agree this is the right time for a change. I want
to thank Jack for his numerous, varied and significant
contributions over the past three years. He leaves behind a strong
Finance team that, with Holly’s support and leadership, will help
us continue to build a strong future for our Company.”
Store Update
Tailored Brands has safely welcomed customers back to 96% of its
retail stores in full compliance with CDC and government
requirements. At the same time, the Company has re-evaluated the
forecasted profitability and strategic value of every store in its
fleet relative to current and anticipated trends in consumer demand
and has identified up to 500 stores for closure over time. The
Company has not yet quantified the expense savings and costs
related to potential store closures and the corresponding store
organization and supply chain infrastructure and organization
realignment.
Additional information will be shared with impacted employees
and customers as decisions are made, and store updates, hours and
safety measures will continue to be available via the store
locators on each of the Company’s brand websites:
menswearhouse.com, josbank.com, kgstores.com and
mooresclothing.com.
About Tailored Brands, Inc.
Tailored Brands is a leading omni-channel specialty retailer of
menswear, including suits, formalwear and a broad selection of
business casual offerings. We help our customers look and feel
their best by delivering personalized products and services through
our convenient network of stores and e-commerce sites. Our brands
include Men's Wearhouse, Jos. A. Bank, Moores Clothing for Men and
K&G.
For additional information on Tailored Brands, please visit the
Company’s websites at
www.tailoredbrands.com, www.menswearhouse.com, www.josbank.com, www.mooresclothing.com,
and www.kgstores.com.
This press release contains forward-looking information,
including the Company’s statements regarding expected workforce
reductions, potential store closures, costs related to the
corporate organizational changes as well as its ability to
strengthen its financial position. In addition, words such as
“expects,” “anticipates,” “envisions,” “targets,” “goals,”
“projects,” “intends,” “plans,” “believes,” “seeks,” “estimates,”
“guidance,” “may,” “projections,” and “business outlook,”
variations of such words and similar expressions are intended to
identify such forward-looking statements. The forward-looking
statements are made pursuant to the Safe Harbor provisions of the
Private Securities Litigation Reform Act of 1995. Any
forward-looking statements that we make herein are not guarantees
of future performance and actual results may differ materially from
those in such forward-looking statements as a result of various
factors. Factors that might cause or contribute to such differences
include, but are not limited to: the effects of the COVID-19
pandemic and uncertainties about its depth and duration, including
the health and well-being of our employees and customers, temporary
store closures, increases in the unemployment rate, furlough or
temporary layoffs of our employees, our ability to increase our
liquidity and preserve financial flexibility, and social distancing
measures or changes in consumer spending behaviors; actions or
inactions by governmental entities; domestic and international
macro-economic conditions; inflation or deflation; the loss of, or
changes in, key employees; success, or lack thereof, in formulating
or executing our internal strategies and operating plans including
new store and new market expansion plans; cost reduction
initiatives and revenue enhancement strategies; changes to our
capital allocation policy; changes in demand for our retail
clothing or rental products, including changes in apparel trends
and changing consumer preferences; market trends in the retail or
rental business; customer confidence and spending patterns; changes
in traffic trends in our stores; customer acceptance of our
merchandise strategies, including custom clothing; performance
issues with key suppliers; disruptions in our supply chain; severe
weather; regional or national civil unrest or acts of civil
disobedience; public health crises, including the recent
coronavirus outbreak; foreign currency fluctuations; government
export and import policies, including the enactment of duties or
tariffs; advertising or marketing activities of competitors; the
impact of cybersecurity threats or data breaches; legal proceedings
and the impact of climate change.
Forward-looking statements are intended to convey the Company’s
expectations about the future, and speak only as of the date they
are made. We undertake no obligation to publicly update or revise
any forward-looking statements that may be made from time to time,
whether as a result of new information, future developments or
otherwise, except as required by applicable law. However, any
further disclosures made on related subjects in our subsequent
reports on Forms 10-K, 10-Q and 8-K should be consulted. This
discussion is provided as permitted by the Private Securities
Litigation Reform Act of 1995, and all written or oral
forward-looking statements that are made by or attributable to us
are expressly qualified in their entirety by the cautionary
statements contained or referenced in this section.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200721005319/en/
Investor Relations Laura Ann Smith (281) 776-7575
ir@tailoredbrands.com
Tailored Brands (NYSE:TLRD)
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