Hanes Brands Inc. reported first-quarter results that beat Wall Street’s consensus estimates.
For the three months ended April 2, net income jumped 52.5 percent to $80.3 million, or 21 cents a diluted share, from $52.6 million, or 13 cents, a year ago. On an adjusted basis, excluding certain charges, earnings per share were 26 cents and beat analysts’ expectations by 4 cents. Net sales rose 0.8 percent to $1.22 billion from $1.21 billion. Wall Street was expecting 22 cents in EPS and $1.21 billion in revenues.
The quarter’s results benefited from its acquisition of Knights Apparel, a collegiate licensed activewear business it bought in April 2015. The company said it continued to “reap acquisition synergy benefits” from the acquisitions of Maidenform and Hanes Europe Innerwear.
The company reaffirmed its guidance for full-year 2016. For now, it expects net sales of between $5.8 billion and $5.9 billion, with adjusted EPS at $1.85 to $1.91. The acquisitions of Maidenform, Knights Apparel and Hanes Europe Innerwear are expected to generate $40 million in synergies in 2016, the company said.
What Hanes Brands did not factor in yet in its projections is the impact of its pending acquisition of Champion Europe, which is slated to close in the middle of the year. Hanes Brands said it will update its guidance to include Champion Europe following the close of that transaction.
Richard A. Noll, Hanes Brands chairman, said, “We are off to a very good start and tracking to our plan to deliver another year of double-digit EPS growth.”
Shares of Hanes Brands closed Thursday unchanged at $28.18. Following its disclosure of first-quarter results after the market’s close, the shares rose 6.3 percent to $29.95 in after-market trading.