HanesBrands beats Q3 expectations, raises outlook

HanesBrands net sales from continuing operations were 937 million dollars in the third quarter, down 2.5 percent, while on an organic constant currency basis, net sales were consistent with prior year. The company's adjusted earnings were 15 cents per share, topping the analyst consensus of 12 cents per share.

The company is raising its full-year and fourth-quarter operating profit, earnings per share, and operating cash flow guidance due to year-to-date performance and strong visibility to continued margin improvement.

“We delivered another strong quarter with operating profit, earnings per share, and cash flow results that exceeded our expectations. In addition, we have further reduced our leverage, expect a return to revenue growth in the fourth quarter, and raised our full-year outlook for profit and cash flow,” said Steve Bratspies, the company’s CEO in a statement.

HanesBrands improves operational results

The company said that the US net sales decreased 1 percent compared to prior year. International net sales increased 1 percent on a reported basis and 4 percent on a constant currency basis compared to prior year as sales grew in the Americas and Asia and were consistent with prior year in Australia.

Gross profit and adjusted gross profit were 390 million dollars and 392 million dollars, respectively, an increase over prior year of 12 percent and 11 percent, respectively.

Gross margin and adjusted gross margin increased approximately 530 and 525 basis points, respectively, to 41.7 percent and 41.8 percent, respectively.

Operating profit increased 27 percent to 103 million dollars and operating margin increased 255 basis points to 11 percent as compared to prior year. Adjusted operating profit increased 46 percent to 122 million dollars and adjusted operating margin increased 435 basis points to 13 percent as compared to prior year.

HanesBrands projects 4 percent decline in 2024 net sales

For fiscal year 2024, HanesBrands currently expects net sales from continuing operations of approximately 3.61 billion dollars, representing an approximate 4 percent decrease on a reported basis and an approximate 2 percent decrease on an organic constant currency basis.

GAAP operating profit from continuing operations is expected to be approximately 174 million dollars and adjusted operating profit from continuing operations of approximately 417 million dollars

The company forecast GAAP loss per share from continuing operations of approximately 32 cents and adjusted earnings per share from continuing operations of approximately 39 cents.

For the fourth-quarter, HanesBrands forecasts net sales from continuing operations of approximately 900 million dollars, representing an approximate 2 percent increase on a reported basis and an approximate 3 percent increase on an organic constant currency basis.

GAAP operating profit from continuing operations of approximately 95 million dollars and adjusted operating profit from continuing operations of approximately 115 million dollars. GAAP earnings per share from continuing operations are expected to be around 6 cents and adjusted earnings per share of approximately 14 cents.