Q4 2019 Earnings Call

Greetings and welcome to the tailored brands fourth quarter 2019, and year end results conference call. If anyone should require operator assistance. During the conference. Please press star zero on her telephone keypad. Please note. This conference is being recorded.

I'll now turn the conference over to our host Julie Macmedan Vice President.

In Investor Relations. Thank you you may begin.

Thank you good afternoon, everyone.

Welcome to tailored brands fourth quarter 2019 results conference call.

This call is being webcast.

A replay will be available on the company's Investor Relations website.

Yeah, our dot tailored brands Dot com.

Also on the website you will find a press release issued earlier today.

For a detailed discussion of Q4.

Fiscal 2019 financial results.

Please note that comments made during the conference call contain forward looking statements.

Within the meaning of the United States Federal Securities laws.

These statements are subject to significant business.

Economic and competitive threats.

Uncertainties and contingencies.

Many of which are beyond our control.

Any forward looking statements are not guarantees of future performance and actual results may differ materially from those in such forward looking statements.

Please refer to todays earnings release, our annual report on form 10-K.

Quarterly reports on forms 10-Q understand these risks and uncertainties.

You can access all of these reports on the tailored brands IR website.

In addition, the information on this call speaks only as of today March 18 29 James.

We assume no obligation to publicly update or revise our forward looking statements.

With me today, our president and CEO, Dinesh Lucky and our CFO Jack Calandra.

Dinesh and Jack will review, our recent business results and the actions, we're taking to weather the near term disruption to our business.

From the Corona virus outbreak.

Given the uncertainty created by the unfolding economic impact at this virus.

We will not be conducting a formal question and answer session. Following today's prepared remarks.

I would now like to turn the call over to Dinesh.

Thank you Julie and good afternoon, everyone.

Let me start by extending on behalf of the entire tailored brands family.

Our thoughts and prayers to those that are well have loved ones that are [laughter] dealing with health for other hardships during this incredibly challenging time.

As we have been reminding our entire team and our frequent communications with them.

It is times like these that bring out the back [laughter] and the best Abbas.

And all of our actions and decisions during this time.

We will endeavor to be our best self.

Earlier today, we released our results for the fourth quarter in fiscal year 2019.

Our Q4 loss per share a 46 cents marks the fourth quarter in a row, where we haven't met or exceeded our guidance.

[laughter] normally we dive into a review of the quarter and our outlook for the coming year [laughter], but that's you're all aware [laughter], we're operating in a business environment that is anything but normal.

The recent spread of the current a virus and the actions taken by our government and citizens to reduce its impact have brought much of our economy to a halt in the short term.

Food and brick and mortar retail.

[laughter] first and foremost our priority continues to be the health and safety.

Our employees customers and the communities in which we operate.

Given the current situation.

Instead of our normal call content.

This call will be exclusively dedicated to how the current a virus is impacting our company.

How we are responding.

[laughter] during this call.

I will cover how our business was performing through the first month Q1.

And what we've seen over the last few weeks is the consumer is reacting to news in government directives related to current virus.

[laughter] Jack will then cover what we've done in response to these emerging business trends and how our business is positioned to whether or not.

[laughter], let's start with business performance.

Heading into the month of March we were seeing positive momentum in our business.

In the month of January we saw a positive comp and our men's wearhouse and kanji brands.

And in the month of February we saw positive comps across all four brands with total retail comps up 2.4%.

[laughter], we were seeing this positive momentum being driven in part by many of the initiatives. We've discussed with you over the last few quarters, including our efforts and building a more relevant assortment a robust E commerce offering and more effective digital marketing.

[laughter] the positive turn in the comp was exciting and supporting evidence that we have the right strategy and that our teams are executing well.

[laughter] Unfortunately business performance became more on even starting in the first week of March.

Decelerated in the second week of March as broad actions by governments businesses school from individuals to help slow the spread if the virus began to take effect.

[laughter] yesterday, we like many retailers.

Closed our brick and mortar stores through March 28.

We will follow the guidance of the C.D.C. Whrrl and local health authorities to determine when we will reopen our stores.

I am pleased to report that we will continue to serve our customers both through our online business.

And with limited store services to ensure they are able to pick up merchandise previously ordered for in store pickup.

We also made the decision to compensate our employees. During this time for regularly scheduled hours up to 40 hours per week.

[laughter], our top priority always has been and always will be the safety and well being of our employees customers and communities.

We firmly believe that putting the safety of our employees and customers first.

Isn't the best interest of all stakeholders.

Given the current environment, we're taking immediate and aggressive actions to increase our cash position and reduce near term expenditures.

I'll turn the call over to Jack now to review these actions in more detail.

And then I'll come back and close today's call.

Jack.

Thanks, the Nash and good afternoon, everyone.

Given the current business environment My comments today will focus on how we prepared the company to face these near term challenges and emerge from this crisis in a strong financial position.

We are taking aggressive and prudent measures to ensure the business has ample liquidity during this uncertain period.

As such we've taken actions both to increase cash on hand and to reduce cash outflows.

With regard to increasing cash on hand on Monday of this week, we drew down 260 million from our revolving credit facility and an abundance of caution and does a proactive measure.

We currently have just under 400 million Couche.

Which includes approximately 100 million from the recently completed sale of the Joseph Abboud trademarks that can be applied to reinvestments in the business.

The second thing we're doing to increased liquidity is eliminating or deferring are all discretionary spending.

We are significantly reducing inventory by planned.

Capital expenditures advertising spend and store in headquarters overhead cost.

These actions will meaningfully reduce cash outlays.

We also have contingency plans for deeper cuts if our stores are close beyond March 28.

We believe the aggressive actions we've taken.

And the contingency plans we've developed.

Well allow us to whether this period of uncertainty.

As I'm sure you appreciate the rapidly changing business environment makes providing accurate and useful guidance very difficult.

And so I will not be providing any guidance for fiscal 2020 at this time.

I look forward to doing so.

The ability of economic and business conditions improve.

Yeah.

I wish you and your family's good health.

And now I'll turn the call back to the Nash to wrap up.

Thank you Jack and thank you everyone for joining us on today's call.

You have my commitment, but during this time of great uncertainty, we will continue to focus on the safety of our employees customers and communities.

While continuing to exercise that fiscal prudence on expenditures and liquidity that this situation demands.

We look forward to updating you on our progress and plans as the situation unfolds.

Please stay safe.

Stay home.

Stay healthy.

Operator.

I will conclude this call.

Thank you.

All parties may disconnect have a good day.