HanesBrands reports a strong year of topline growth and cash flow; full-year revenue up 7 percent
HanesBrands, a global marketer of basic apparel has announced a 7 percent uptick in full year net sales to $6.47 billion. The company also reported a cash flow of $656 million, bumped up from $606 million last year.
With a full-year adjusted EPS of $1.93, excluding the effect of a tax charge, that increased 4 percent and a marginal increase in adjusted operating profit to $916 million, 2017 was a successful year for Hanes — driven by a strong activewear segment, acquisition integration and growing international businesses.
“2017 was a successful year during which we focused on diversifying our business to be able to consistently deliver annual topline growth,” said HanesBrands Chief Executive Officer Gerald W. Evans Jr.
Hanes also announced Q4 sales growth of 4 percent to $1.645 billion. Notably, 2 percent came from organic growth, barring sales accrued from acquisitions. This was the second successive quarter of organic growth for the company across each of the innerwear, activewear and international segments.
Broad-based activewear demand, up by 3 percent for the full year, has continued to drive company topline growth. Q4 organic activewear sales increased 4 percent, while the acquisition of Alternative Apparel in October 2017 contributed $18 million in sales. Segment operating profit increased 2 percent in the fourth quarter and 1 percent for the full year.
With sales continuing to soften in North America, the company is heavily dependent on International growth. Luckily for them, segment net sales were up 34 percent for the full year, driven by new store openings and strong consumer demand across all geographies. Global online sales increased 22 percent in the fourth quarter, up in every geography.
Mr Evans added that the increased cash flow from operations will be the engine of the business model, driving “the company’s growth initiatives, acquisitions and capital strategy”.
The company took the opportunity to announce an agreement to acquire Australian specialty retailer of intimate apparel Bras N Things. The all-cash transaction is valued at approximately US$400 million on an enterprise-value basis. The pending acquisition, due to close in mid-February, is expected to add to earnings in 2018.
The company expects another strong year in 2018 with net sales of $6.72 billion to $6.82 billion and an adjusted EPS of $1.72 to $1.80.
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