Sat Joshi McIntire Investment Institute September 9, … A. Bank Clothiers Sat Joshi McIntire Investment Institute September 9, 2003

Joseph A. Bank Clothiers

Sat JoshiMcIntire Investment InstituteMcIntire Investment Institute

September 9, 2003

Joseph A. Bank Clothiers

Company Overview

• Established in 1905

• Men’s tailored and casual clothing and accessories

Joseph A. Bank Clothiers

Company Overview• 174 Retail stores

Northeast, Midwest, South, Mid-AtlanticSouth, Mid-Atlantic

Joseph A. Bank Clothiers

Company Overview

• Multi-channel retailing• Stores, internet, catalog• Stores, internet, catalog• Synergy, brand recognition

Joseph A. Bank Clothiers

Thesis #1

• Superior Cost Structure• Superior Pricing• Superior Pricing

• High Quality Product

• Industrial Presence

Joseph A. Bank Clothiers

Thesis #1

• Superior Cost Structure• Design and purchasing• Design and purchasing• Merchandise and

planning staffs coordinated efforts

• Supplier and Manufacturing• Diversification

Joseph A. Bank Clothiers

Thesis #1

• High Quality Product• Customer satisfaction• Customer satisfaction• Common suppliers with

competitors

• Industrial Presence• Thriving in a harsh industry

Joseph A. Bank Clothiers

Thesis #2

• Absolute Focus on Customer

• First Mover: Technology

• Retail Channels

Joseph A. Bank Clothiers

Thesis #2

• Absolute Focus on Customer• Build and maintain client • Build and maintain client

relationships

• Emails; same store sales

• Dominate the customer budget

Joseph A. Bank Clothiers

Thesis #2

• First Mover: Technology

• Inventory, infrastructure

• Database, targeted marketing

Joseph A. Bank Clothiers

Thesis #2

• Retail Channels• Store, Web, Phone• Store, Web, Phone

• Location is everything!

• Coordination, Streamlined• Established customers• Customer returns

Joseph A. Bank Clothiers

Thesis #3

• Rapid Growth

• Growth Financing• Recursive Value

Enhancement

Joseph A. Bank Clothiers

Thesis #3

• Rapid Growth• April 2002: 137 Stores• April 2002: 137 Stores• April 2003: 174 Stores

• Increasing growth rate

• +75-100 per year here on out

Joseph A. Bank Clothiers

Thesis #3

• Growth Financing• Internally Financed• Internally Financed• Same-store sales

• Paying off debt• No additional bond/equity

offerings• The cycle drives itself

Joseph A. Bank Clothiers

Someone Say Competitors?

Lands’ End Men’s WarehouseDept. Stores Others

Joseph A. Bank Clothiers

Nordstrom

• Large Dept. Store• Department • Department

interdependence• Aggregate performance

• What happened to Britches?

Joseph A. Bank Clothiers

Brooks Brothers

• Serious decline in quality• Ownership, banktuptcy, and • Ownership, banktuptcy, and

more• Jaguar phenomenon?

Joseph A. Bank Clothiers

So Back to Competitors

• Cost structure• Pricing Points• Pricing Points• Excess Inventories

• Image is everything• Alienating your customers

Joseph A. Bank Clothiers

Risks

• Variety of External Factors• Volatile industry• Volatile industry

• Young Brand Identity• Other established players

• Expansion Strategy• Geographic segmentation

Joseph A. Bank Clothiers

Value Added Research

• Store Visits• Speak with employees• Speak with employees• Observe customers• Test out the service

• Talk to Everyone• Financial Insights• Professionals

• Analyze

Joseph A. Bank Clothiers

Key Figures

Share Price: 43.96

Shares Outstanding: 6.20 M

Market Cap: $272.30 M

LT Debt: $24.64 M

Joseph A. Bank Clothiers

Check itG

Joseph A. Bank Clothiers

THE END