Carter’s full year net sales and profit grow, reveals positive outlook

For the fourth quarter, Carter’s, Inc. consolidated net sales increased 72.2 million dollars or 7.3 percent to 1,062.1 million dollars. On a comparable week basis, net sales grew 10.9 percent.

The company said in a release that additional week in the fourth quarter of fiscal 2020 contributed approximately 32.1 million dollars in consolidated net sales.

“We saw strong demand for our brands in the fourth quarter which enabled us to exceed our sales and earnings objectives,” said Michael Casey, the company’s chairman and chief executive officer, adding, “For the year, we achieved a record level of profitability. With the continued recovery from pandemic-related disruptions, we have raised our longer-term growth objectives and are now forecasting annual sales to exceed $4 billion by 2026, with earnings in excess of 12 dollars per share.”

Carter’s fourth quarter results

On a reported basis, the company’s U.S. retail, U.S. wholesale, and international segments grew 3 percent, 9 percent and 25 percent, respectively. U.S. retail segment comparable sales increased 15 percent, driven by improved store sales.

Operating income increased 4.1 million dollars or 3.1 percent to 138 million dollars, while operating margin decreased 50 basis points to 13 percent. Adjusted operating income decreased 7.6 million dollars or 5.2 percent to 137.9 million dollars and adjusted operating margin was 13 percent compared to 14.7 percent in the fourth quarter of fiscal 2020.

Net income decreased 2 million dollars or 2.1 percent to 97 million dollars, earnings per diluted share increased 2.2 percent to 2.31 dollars. Adjusted net income decreased 11 million dollars or 10.2 percent to 96.9 million dollars and adjusted earnings per diluted share decreased 6.1 percent to 2.31 dollars.

Carter’s full year result highlights

For the full year, consolidated net sales increased 462.1 million dollars or 15.3 percent to 3.5 billion dollars, driven by strong growth in all segments. The additional week in fiscal 2020 contributed approximately 32.1 million dollars in consolidated net sales. On a comparable week basis, net sales grew 16.5 percent.

On a reported basis, the company’s U.S. retail, U.S. wholesale and international segments grew 14 percent, 13 percent and 29 percent, respectively.

Operating income in fiscal 2021 increased 307.2 million dollars or 161.8 percent to 497.1 million dollars and operating margin increased 800 basis points to 14.3 percent. Adjusted operating income increased 221 million dollars or 79 percent to 500.8 million dollars, while adjusted operating margin increased 510 basis points to 14.4 percent.

Net income increased 230 million dollars or 209.7 percent to 339.7 million dollars, while earnings per diluted share increased 212.4 percent to 7.81 dollars. Adjusted net income increased 159.9 million dollars or 87.6 percent to 342.5 million dollars, and adjusted earnings per diluted share increased 89.2 percent to 7.87 dollars.

Carter’s projects targets for the year ahead and for five year period

For fiscal 2022, the company projects net sales increase of approximately 2 percent to 3 percent, with growth in all segments; adjusted operating income increase of approximately 4 percent to 6 percent compared to adjusted operating income of 500.8 million dollars in fiscal 2021; and adjusted diluted earnings per share increase of approximately 12 percent to 14 percent compared to 7.87 dollars in fiscal 2021.

For the first quarter of fiscal 2022, the company projects net sales of approximately 740 million dollars to 750 million dollars; adjusted operating income of approximately 85 million dollars to 90 million dollars compared to 128.5 million dollars in the first quarter of fiscal 2021; and adjusted diluted earnings per share of approximately 1.25 dollars to 1.35 dollars compared to 1.98 dollars in the first quarter of fiscal 2021.

For the first half of fiscal 2022, the company projects net sales of approximately 1,550 million dollars to 1,565 million dollars; adjusted operating income of approximately 195 million dollars to 205 million dollars compared to 239 million dollars in the first half of fiscal 2021; and adjusted diluted earnings per share of approximately 3.05 dollars to 3.25 dollars compared to 3.64 dollars in the first half of fiscal 2021.

For the five year period, the company projects low single-digit growth in net sales, mid single-digit growth in adjusted operating income and high single-digit growth in adjusted diluted earnings per share.