(Filed Under Financial and General Interest News). HanesBrands Innerwear sales rose 35.0% while that segment’s operating profit soared 56.2%, in the three months ended April 3, 2021.
Innerwear sales for the quarter were $570.4 million, up from $422.4 million in the three months ended March 28, 2020. Segment operating profit rose to $127.4 million, up from $81.6 milion the year before. The company noted that “the Innerwear segment includes approximately $4 million of net sales and no operating profit from the sale of personal protective equipment in the first quarter of 2021.”
Hanes as a whole, which also includes Activewear, International and Other divisions, reported a loss of $263.3 million on sales of $1.508 billion in the quarter. The loss caused by a $392 million “non-cash charge related to reclassifying [its] European Innerwear business as discontinued operations.” It explained, “the company previously announced its intention to seek strategic alternatives for its European Innerwear business as it focuses on other strategic growth opportunities,” adding that since the Europeans Innerwear business is “now reflected in discontinued operations, all year-over-year comparisons are based on continuing operations.”
Discussing its ongoing Innerwear sales, the company stated, “The strong year-over-year growth was driven by underlying point-of-sale growth and market share gains combined with the overlap of the initial pandemic shutdown as well as certain one-time benefits, including government stimulus and retailer restocking. For the quarter, basics revenue increased 39% with growth across all product categories. Intimates revenue increased 27% driven by double-digit growth in bras.” It added that “the segment’s operating margin increased 300 basis points to 22.3%.”
For fiscal year 2021, which ends on January 1, 2022, Hanes as a whole expects “Net sales from continuing operations to total approximately $6.2 billion to $6.3 billion, which includes a projected benefit of approximately $100 million from changes in foreign currency exchange rates. At the midpoint, net sales guidance implies approximately 2% growth over prior year.”
Commenting on the period, CEO Steve Bratspies said, “Our strong first-quarter results showed growth across all business segments. Champion continued its rapid growth, driven by strong consumer demand. We gained share in U.S. Innerwear, and our Hanes Total Support Pouch launch shows how our brands can appeal to younger consumers with a combination of innovative products and compelling marketing. Our global online sales grew more than 80% as we focus on empowering consumers to shop when, where and how they want to shop.” — NM
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