ALEXANDER CITY, Ala. — Continuing to face sharp price pressures in the fleece and T-shirt market, Russell Corp. reported first-quarter earnings fell 16.6 percent, to $13.4 million, or 33 cents a share.
Treasurer Tony Meyer said these earnings were in the high end of Wall Street analysts’ estimates, which ranged from 28 to 35 cents a share.
In the year-ago quarter, Russell earned $16 million, or 39 cents, including a gain of 2 cents a share from accounting changes.
In the quarter ended April 3, sales rose 13.4 percent, to $232.1 million from $204.7 million. The latest quarter includes $17.3 million in sales from the acquisition of The Game, which makes licensed sports products, primarily caps.
John C. Adams, chairman, president and chief executive officer, said gross margin was hurt by price pressure and decreased production in the quarter. Acquisition of The Game drove up selling, general and administrative expenses.
Adams said business has picked up, and inventories are better at all levels in the distribution chain. Meyer said plants had been running on a four-day schedule in some T-shirts and fleece lines, but based on improved sales and inventories, production is back to five days and six days for certain lines.