- Hanesbrands Inc HBI reported a third-quarter FY22 sales decline of 7% year-on-year to $1.67 billion, missing the consensus of $1.71 billion.
- The constant currency sales decline of 3% was due to the macro-driven slowdown in consumer spending in the U.S. and certain Asian markets.
- Innerwear sales decreased 11% Y/Y due to macroeconomic pressures that weighed on consumer spending as well as the impact from retailer actions to manage inventory. Activewear sales were comparable to prior year.
- Global Champion brand sales decreased 9% over the prior year in constant currency, or 14% on a reported basis.
- Gross margin contracted 540 basis points Y/Y to 33.7%. Operating margin contracted 460 basis points to 8.5%, and operating income for the quarter fell 40% to $141 million.
- Inventories increased 31% Y/Y to $2.14 billion. The company held $253 million in cash and equivalents as of October 1, 2022.
- Cash flow from operations was a use of $(51) million, driven primarily by the working capital impact from higher inventory.
- Adjusted EPS of $0.29 beat the analyst consensus of $0.27.
- The company's regular cash dividend of $0.15 per share is payable on December 13, 2022, to stockholders of record on November 22, 2022.
- Outlook: Hanesbrands sees Q4 FY22 sales of $1.4 billion - $1.45 billion versus the consensus of $1.63 billion. The company expects adjusted EPS of $0.04 - $0.11 versus the consensus of $0.21.
- For FY22, HBI sees sales of $6.16 billion - $6.21 billion (prior view $6.45 billion - $6.55 billion) versus the consensus of $6.42 billion.
- It sees an adjusted EPS of $0.95 - $1.02 (prior view $1.11 - $1.23), compared to the consensus of $1.11.
- Price Action: HBI shares are trading lower by 5.23% at $6.71 on the last check Tuesday.
- Photo Via Company
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