(Filed Under Financial and General Interest News). Sales in the “innerwear” segment at HanesBrands, Inc. declined 4.4% for the quarter ended April 4, 2015 but operating profit for that segment actually rose 13%. Meanwhile, at the parent company, overall sales rose 14.1% and net income rose 26.7% over the same period last year.
For the most recent quarter, Hanes reported earnings of $52.6 million on sales of $1.209 billion compared to earnings of $41.6 million on sales of $1.059 billion in the quarter ended March 29, 2014. Innerwear sales dropped to $546.2 million from $571.2 million, while the segment’s operating profit rose to $110.8 million from $98.0 million in the same quarter last year.
“Our acquisition strategy continues to create value with DBApparel, Maidenform and Gear for Sports all contributing substantially to our double-digit growth,” declared Hanes chairman and CEO Richard Noll in announcing the results. “In addition, we are raising our 2015 performance outlook to reflect the recent acquisition of Knights Apparel.” Hanes now “expects net sales of approximately $5.9 billion to $5.95 billion; adjusted operating profit of $853 million to $873 million; and adjusted EPS of $1.61 to $1.66” for 2015, according to the firm. “The new guidance represents an increase over 2014 results of 10.9 percent to 11.8 percent for net sales, 12 percent to 14 percent for adjusted operating profit, and 13 percent to 17 percent for adjusted EPS.”
Hanes listed one of the “key accomplishments” in the first quarter as being “Sales Growth Driven by DBApparel Acquisition. DBApparel, a leading marketer of intimate apparel and underwear in Europe that was acquired Aug. 29, 2014, contributed net sales of $184 million (€164 million) in the first quarter.”
Hanes said the increase in operating profit in its Innerwear segment in the quarter came “primarily as a result of strong Maidenform cost synergies. The result was a 310-basis-point improvement in segment operating margin compared with the year-ago quarter. The decline in net sales was due to a retailer’s inventory reduction of approximately two weeks of supply, which has already begun to reverse in early April.”
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