By  on July 27, 2012

In a reversal of the 2011 trend, U.S.-based apparel marketers are likely to have an easier time generating strong profit increases during the back-to-school season than they are producing robust sales growth.

According to a report by Moody’s Investors Service published Thursday, apparel brands and retailers can expect third-quarter sales increases of 2 to 3 percent while operating profits, boosted by lower cotton input costs, should grow 8 to 10 percent over levels from the comparable quarter of 2011. In last year’s period, sales were up about 10 percent while operating earnings were “essentially flat as operators were unable to pass through higher input costs, most notably cotton.”

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