Hanesbrands Q1 net sales rise 12 percent

REPORT_ Hanesbrands announced that acquisition benefits and strong operating performance drove record

first-quarter financial results. For the first-quarter 2014, net sales increased 12 percent to 1.06 billion dollars, adjusted operating profit excluding actions increased 34 percent to 114 million dollars, and adjusted EPS excluding actions increased 49 percent to 0.76 dollars.

As a result of strong first-quarter 2014 results, the company has raised its 2014 full-year financial guidance. Increased expectations include adjusted operating profit of 665 million dollars to 685 million dollars, up 25 million dollars; adjusted EPS of 4.80 dollars to 5 dollars, up 0.20 dollars; and net cash from operating activities of 475 million dollars to 575 million dollars, up 25 million dollars. The company based in Winston-Salem continues to expect net sales for the year of slightly less than 5.1 billion dollars.

“We had very strong first-quarter profitability and have raised our full-year profit guidance as a result of our continued confidence in our Innovate-to-Elevate strategy and our progress with the integration of Maidenform,” said Hanes Chairman and Chief Executive Officer Richard A. Nollsaid, adding “Our Activewear segment achieved outstanding results across channels, particularly with our Champion brand at retail.”

Excluding the Maidenform acquisition, net sales on a constant currency basis were flat despite the difficult retail environment exacerbated by extreme weather. Adjusted EPS for the quarter increased to 0.76 dollars from 0.51 dollars in 2013. On a GAAP basis, diluted EPS was 0.41 dollars in the quarter versus 0.51 dollars a year ago. Adjusted operating profit for the quarter increased to 114 million dollars.

Innerwear net sales increased 15 percent in the first quarter, with all of the growth a result of the Maidenform acquisition. Operating profit increased 7 percent. Excluding Maidenform, net sales decreased 6 percent, while operating profit increased 1 percent. The Activewear segment continued to deliver strong performance with net sales increasing 10 percent in the first quarter and operating profit increasing 50 percent. In addition to retail Champion, the branded printwear and Gear for Sports businesses also delivered strong quarters of sales and profit growth.

Currency had a significant impact on International net sales and profits. On a constant-currency basis, international net sales increased 19 percent in the first quarter and operating profit increased 300 percent. Maidenform contributed to both sales and operating profit. As reported, international net sales increased 9 percent and operating profit more than tripled.