HanesBrands reports 5 percent growth in annual sales

HanesBrands announced growth in net sales, operating profit and diluted earnings per share for the fourth-quarter and full-year 2016. Hanes has announced initial financial guidance for 2017, forecasting high-single-digit growth expectations for net sales, record cash flow from operations, and growth for operating profit and earnings per diluted share. Fourth-quarter net sales increased 12 percent to 1.58 billion dollars and full-year net sales increased 5 percent to 6.03 billion dollars.

“We had a strong year of sales, profit and cash flow growth with many accomplishments, including the expansion of our X-Temp product lineup, the successful launch of our HanesFreshIQ underwear innovation, acquisition integration, and new acquisitions in Europe and Australia,” said Hanes Chief Executive Officer Gerald W. Evans Jr in a statement.

Additional results highlights and FY17 outlook

On a GAAP basis, fourth-quarter EPS of 0.41 dollar increased 37 percent and full-year EPS of 1.40 dollars increased 32 percent. When excluding pretax charges related to acquisitions and integrations, adjusted EPS of 0.53 dollar in the fourth quarter increased 20 percent and full-year adjusted EPS of 1.85 dollars increased 11 percent.

Hanes has issued initial guidance for 2017 that represents a fifth consecutive year of record net sales, operating profit and EPS. The company said, guidance reflects acquisition contributions, growth opportunities, the effect of the ongoing consumer shift toward online purchases, and negative currency impacts that are expected to dampen growth of International segment sales and operating profit.

The company expects 2017 net sales of 6.45 billion dollars to 6.55 billion dollars, GAAP operating profit of 845 million dollars to 895 million dollars, adjusted operating profit excluding actions of 935 million dollars to 975 million dollars, GAAP EPS for continuing operations of 1.70 dollars to 1.82 dollars, adjusted EPS excluding actions for continuing operations of 1.93 dollars to 2.03 dollars.

Compared with 2016 results, the midpoint of 2017 guidance represents net sales growth of 8 percent, GAAP operating profit growth of 12 percent, adjusted operating profit growth of 5 percent, GAAP EPS growth from continuing operations of 26 percent, adjusted EPS growth from continuing operations of 7 percent, and operating cash flow growth of 11 percent.

The company expects total net sales growth in the first quarter as a result of acquisition-driven international gains as well as activewear growth. The company said, organic sales are expected to decline in the quarter as a result of lower innerwear sales affected by the retail climate of store closings and tight inventory as well as the exits from the company’s domestic catalog business and noncore offerings. Innerwear sales trends are expected to normalize starting in the second quarter, with expected full-year net sales comparable to 2016.

First-quarter GAAP EPS for continuing operations is expected to be 0.21 dollar to 0.24 dollar, and adjusted EPS is expected to be 0.27 dollar to 0.29 dollar.

Picture:Hanes