Source: Company reports

Hanesbrands reported total 1Q16 revenues of $1.22 billion, up 0.8% from a year ago and slightly above the consensus estimate. Adjusted EPS was $0.26, up 18% from a year ago and beating analysts’ estimate of $0.22. The positive results are a direct reflection of the company’s successful execution of its acquisition strategy and continued improvement in core business operating margins. The acquisition of Knights Apparel, a collegiate licensed activewear business, in April 2015 contributed to sales of approximately $21 million. Hanesbrands also continued to benefit from synergies related to all three of its recent acquisitions, Maidenform, Knights Apparel and Hanes Europe Innerwear. Management commented that the year was off to a good start and tracking to plan to deliver another year of double-digit EPS growth. The company also remains focused on previously announced sales initiatives, reaping acquisition synergies, expanding margins, and developing growth plans for the pending acquisition of Champion Europe. The company specifically called out three highlights from this earnings report: contribution from acquisitions, sales increase from innerwear and activewear, and margin improvement.

OUTLOOK

The company reaffirmed its full-year guidance for 2016. It expects net sales of $5.8–$5.9 billion and adjusted EPS of $1.85–$1.91. The guidance does not reflect the planned acquisition of Champion Europe, which was announced on April 7, 2016, and is expected to close midyear. The guidance does reflect benefits from the acquisitions of Maidenform, Knights Apparel and Hanes Europe Innerwear.