With strong sales in its active wear business as well as the topline benefit from prior acquisitions in that segment, Hanesbrands Inc. posted double-digit sales and earnings for the third quarter.
As a result, the company said adjusted earnings per share for the 2015 fiscal year would be between $1.66 and $1.68 per share, which is 17 percent to 18 percent above 2014’s results.
Net sales in the quarter gained 13.6 percent to $1.59 billion from $1.4 billion in the same period last year as net income jumped 36.3 percent to $162.2 million, or 40 cents a share, from $118.9 million, or 29 cents. On an adjusted basis (due to prior acquisitions), the earnings per share gain was 16 percent, the company said. The gross margin rate jumped to 36.5 percent in the quarter from 35.5 percent last year.
“The April 2015 acquisition of Knights Apparel, a licensed apparel leader, added net sales of $84 million to active wear results in the third quarter,” the company said. adding that the 2014 acquisition of DBApparel in Europe added $179 million to the topline in the quarter.
The company also said it “expanded its strategic use of cash flow in the quarter by beginning to repurchase company stock in the open market.” In the quarter, the company bought 10.7 million shares for about $311 million.
Chairman and chief executive officer Richard A. Noll said the strong results “reflect our continued value-creation potential.”
“We again have increased our operating profit and [earnings per share] guidance as we continue to drive growth and margin improvement through innovation and acquisition integration,” the ceo said. “We also reached another milestone in our strategic use of cash flow with the resumption of share buybacks.”