Hanes: Better Q1

Hanes launched its Bonds underwear brand in the U.S. in Q1.

Despite a challenging start, Hanes reported improvements over last year in the first quarter. The company lost $9.46 million on sales of $760.15 million in the period, compared to a loss of $39.12 million on sales of $744.68 million in the same quarter last year.

In addition to the net sales increase of 2.1%, “GAAP gross margin increased 170 basis points over prior year to 41.7%.”

The international company noted that  “U.S. net sales decreased 1% as compared to prior year,” adding that it “continued to focus on its core growth fundamentals including innovation, increased brand investments, and incremental programming opportunities. These fundamentals delivered year-over-year growth in its Basics, Active, and New businesses. Similar to the overall innerwear market, this growth was more than offset by continued headwinds in the Intimate Apparel business.”

“International net sales decreased 2% on a reported basis, which included a $12 million headwind from unfavorable foreign exchange rates. International sales increased 4% on a constant currency basis compared to prior year as sales grew in Australia and Asia and were consistent with prior year in the Americas.”

CEO Steve Bratspies boasted, “We delivered another strong quarter, including revenue, operating profit and earnings per share that exceeded our expectations as we continue to see the benefits of our growth strategy and prior transformation initiatives. We also reiterated our full-year outlook, which now reflects our expected impact from U.S. tariffs, as the current environment presents challenges but also creates real revenue opportunities. We’re confident we can fully mitigate the cost headwinds as we have many levers to pull, including further cost reductions and pricing actions. We’re also actively pursuing new revenue opportunities, which we believe we’re in an advantaged position to capture given our western hemisphere supply chain speed and capabilities matched with our strong retailer relationships.”

Looking at the full year, which ends January 3, 2026, and includes a 53rd week, Hanes is projecting “net sales from continuing operations of approximately $3.47 billion to $3.52 billion, which includes projected headwinds of approximately $60 million from changes in foreign currency exchange rates. At the midpoint, net sales are expected to be relatively consistent with prior year on a reported basis and increase approximately 1% on an organic constant currency basis. GAAP operating profit from continuing operations of approximately $425 million to $440 million.”

In other recent news, Hanes announced the launch of its Bonds men’s underwear brand in the U.S. for the first time. The label originated in Australia over 100 years ago, and Hanes acquired in and parent Pacific Brands in an $800 million deal in 2016.  Tanya Deans, president of Bonds Australia, claimed that “The average Aussie has 12 Bonds products in their home.” Sizes range from XS-XXL (Women’s), S-3XL (Men’s), and 32A-38DD (Bras).