Strong Q3 For Hanes

Hanes earned $29.961 million on sales of $937.103 million in the third quarter, compared to a loss of $38.799 million on sales of $961.294 in the same quarter last year. The company also raised its “full-year and fourth-quarter 2024 operating profit, earnings per share, and operating cash flow guidance due to year-to-date performance and strong visibility to continued margin improvement.”

For full year 2024, Hanes “currently expects net sales from continuing operations of approximately $3.61 billion, which includes projected headwinds of approximately $50 million from last year’s U.S. Sheer Hosiery divestiture and approximately $42 million from changes in foreign currency exchange rates. This represents an approximate 4% decrease as compared to prior year on a reported basis and an approximate 2% decrease on an organic constant currency basis.” It added that it expects an “operating profit from continuing operations of approximately $174 million.”

CEO Steve Bratspies said that “operating profit, earnings per share, and cash flow results” in the quarter “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. Our strategic actions to create a more focused, simplified business are working. We are driving a step-function change in our cost structure, increasing operational efficiencies, reducing inventory, and freeing up capital to invest in growth. We expect the benefits of these actions to ramp over the next several quarters, giving us visibility and confidence to deliver continued margin improvement, cash generation, and debt reduction through 2025.”

Hanes pointed to several recent improvements. “Point-of-sale trends have outperformed the total market year-to-date as increased brand investments and product innovation in” the firm’s “Hanes, Maidenform and Bali brands are driving permanent retail space and market share gains, particularly with younger consumers. Operating margin of 22.1% increased approximately 665 basis points over prior year. The increase was driven by lower input costs, favorable product mix, and benefits from cost savings initiatives, which helped fund a 55% increase in brand investments to drive consumer demand behind new product innovation in both men’s and women’s. International net sales increased 1% on a reported basis, which included a $7 million headwind from unfavorable foreign exchange rates. International sales increased 4% 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 as the company begins to anniversary the worst of Australia’s macroeconomic-driven headwinds.”

Above, new on the Hanes website: the Comfort Evolution Women’s Wireless T-Shirt Bra with SmoothTec Band.