HanesBrands Announces Second-Quarter 2024 Results
HanesBrands announced its second-quarter 2024 results, with a better-than-expected performance in the U.S. innerwear business and a significant margin expansion. The company revealed plans to sell its global Champion business and completed the exit of U.S. outlet stores, reclassifying both to discontinued operations.
For continuing operations, net sales decreased by 4% to $995 million, while adjusted operating profit increased by 46% to $126 million. Adjusted earnings per share (EPS) surged by 650% to $0.15. Notably, the company aims to pay down around $1 billion of debt in the second half of 2024, utilizing proceeds from the Champion sale.
HanesBrands also adjusted its full-year 2024 guidance, projecting net sales of $3.59-$3.63 billion and adjusted EPS of $0.31-$0.37. For the third quarter, the company anticipates net sales of $920-$950 million and adjusted EPS of $0.09-$0.14.
Positive internal cash flow and strategic cost-saving measures are expected to drive further margin improvements and shareholder value in the coming years.
HanesBrands ha annunciato i risultati del secondo trimestre 2024, registrando una performance migliore del previsto nel settore dell'abbigliamento intimo negli Stati Uniti e un'ampia espansione dei margini. L'azienda ha rivelato piani per vendere il suo marchio globale Champion e ha completato l'uscita dai negozi outlet statunitensi, riclassificando entrambi alle operazioni discontinue.
Per le operazioni continuative, le vendite nette sono diminuite del 4% a $995 milioni, mentre il profitto operativo rettificato è aumentato del 46% a $126 milioni. Gli utili per azione rettificati (EPS) sono balzati del 650% a $0,15. È importante notare che l'azienda mira a ridurre circa $1 miliardo di debito nella seconda metà del 2024, utilizzando i proventi dalla vendita di Champion.
HanesBrands ha anche aggiornato le previsioni per l'intero anno 2024, prevedendo vendite nette tra $3,59 e $3,63 miliardi e un EPS rettificato tra $0,31 e $0,37. Per il terzo trimestre, l'azienda prevede vendite nette tra $920 e $950 milioni e un EPS rettificato tra $0,09 e $0,14.
Un flusso di cassa interno positivo e misure strategiche per il contenimento dei costi sono previsti per stimolare ulteriori miglioramenti dei margini e il valore per gli azionisti nei prossimi anni.
HanesBrands anunció sus resultados del segundo trimestre de 2024, con un rendimiento mejor de lo esperado en el negocio de ropa interior en EE. UU. y una significativa expansión de márgenes. La compañía reveló planes para vender su negocio global de Champion y completó la salida de las tiendas outlet en EE. UU., reclasificando ambos como operaciones discontinuas.
Para las operaciones continuas, las ventas netas disminuyeron un 4% a $995 millones, mientras que el beneficio operativo ajustado aumentó un 46% a $126 millones. Las ganancias por acción ajustadas (EPS) se dispararon un 650% a $0.15. Es notable que la empresa tiene como objetivo pagar alrededor de $1 mil millones de deuda en la segunda mitad de 2024, utilizando los ingresos de la venta de Champion.
HanesBrands también ajustó sus previsiones para todo el año 2024, proyectando ventas netas de $3.59 a $3.63 mil millones y un EPS ajustado de $0.31 a $0.37. Para el tercer trimestre, la compañía anticipa ventas netas de $920 a $950 millones y un EPS ajustado de $0.09 a $0.14.
Se espera que un flujo de caja interno positivo y medidas estratégicas de ahorro de costos impulsen futuras mejoras en los márgenes y el valor para los accionistas en los próximos años.
HanesBrands는 2024년 2분기 실적을 발표하며, 미국 내의 속옷 사업에서 기대 이상의 성과를 거두고 상당한 마진 확대를 기록했다고 밝혔습니다. 회사는 글로벌 Champion 사업을 매각할 계획을 발표했으며, 미국 아울렛 상점의 철수를 완료하고 두 사업 모두를 중단된 운영으로 재분류했습니다.
계속 운영을 위한 순매출은 4% 감소한 $995백만 달러를 기록했으며, 조정된 운영 이익은 46% 증가하여 $126백만 달러에 달했습니다. 조정된 주당순이익(EPS)은 650% 급증하여 $0.15에 도달했습니다. 특히, 회사는 2024년 하반기에 Champion 매각으로 수익을 활용하여 약 $10억의 부채를 상환할 계획입니다.
HanesBrands는 또한 2024년 전체 연간 가이던스를 조정하여 순매출을 $3.59~$3.63억 달러, 조정 EPS를 $0.31~$0.37로 예상하고 있습니다. 3분기에는 순매출을 $920~$950백만 달러, 조정 EPS를 $0.09~$0.14로 예상하고 있습니다.
긍정적인 내부 현금 흐름과 전략적인 비용 절감 조치는 향후 몇 년 동안 마진 개선과 주주 가치를 더욱 높이는 데 기여할 것으로 기대됩니다.
HanesBrands a annoncé ses résultats pour le deuxième trimestre 2024, affichant des performances meilleures que prévu dans le secteur de l'habillement intérieur aux États-Unis et une expansion significative des marges. L'entreprise a révélé des plans pour vendre son activité Champion à l'échelle mondiale et a finalisé la fermeture de ses magasins d'usine aux États-Unis, reclassifiant les deux en opérations abandonnées.
Pour les opérations en cours, les ventes nettes ont diminué de 4 % pour atteindre 995 millions de dollars, tandis que le bénéfice opérationnel ajusté a augmenté de 46 % pour atteindre 126 millions de dollars. Les bénéfices par action ajustés (EPS) ont grimpé de 650 % pour atteindre 0,15 USD. Notamment, l'entreprise vise à réduire d'environ 1 milliard de dollars de dettes au second semestre 2024, en utilisant les produits de la vente de Champion.
HanesBrands a également ajusté ses prévisions pour l'année complète 2024, projetant des ventes nettes entre 3,59 et 3,63 milliards de dollars et un EPS ajusté de 0,31 à 0,37 USD. Pour le troisième trimestre, l'entreprise prévoit des ventes nettes entre 920 et 950 millions de dollars et un EPS ajusté entre 0,09 et 0,14 USD.
Un flux de trésorerie interne positif et des mesures stratégiques d'économies de coûts devraient entraîner des améliorations supplémentaires des marges et de la valeur pour les actionnaires dans les années à venir.
HanesBrands hat die Ergebnisse für das zweite Quartal 2024 bekannt gegeben, mit einer besseren als erwarteten Leistung im US-Innenbekleidungssegment und einer signifikanten Margenausweitung. Das Unternehmen hat Pläne angekündigt, sein globales Champion-Geschäft zu verkaufen, und die Schließung der US-Outlets abgeschlossen, wobei beide als discontinue Operationen umklassifiziert wurden.
Bei den fortgeführten Operationen sanken die Nettoverkäufe um 4 % auf 995 Millionen US-Dollar, während der ajustierte operative Gewinn um 46 % auf 126 Millionen US-Dollar anstieg. Die ajustierten Gewinne pro Aktie (EPS) stiegen um 650 % auf 0,15 USD. Bemerkenswert ist, dass das Unternehmen plant, in der zweiten Jahreshälfte 2024 etwa 1 Milliarde US-Dollar Schulden zu reduzieren, indem es die Erlöse aus dem Verkauf von Champion nutzt.
HanesBrands hat zudem seine Prognosen für das gesamte Jahr 2024 angepasst und rechnet mit Nettoverkäufen von 3,59 bis 3,63 Milliarden USD und ajustierten EPS von 0,31 bis 0,37 USD. Für das dritte Quartal rechnet das Unternehmen mit Nettoverkäufen von 920 bis 950 Millionen USD und ajustierten EPS von 0,09 bis 0,14 USD.
Ein positiver interner Cashflow und strategische Kostensenkungsmaßnahmen werden voraussichtlich weitere Margenverbesserungen und einen höheren Wert für die Aktionäre in den kommenden Jahren vorantreiben.
- Adjusted operating profit increased 46% to $126 million.
- Adjusted EPS increased 650% to $0.15.
- Expecting to pay down $1 billion debt in H2 2024.
- U.S. innerwear market share increased by 40 basis points.
- Net sales projected at $3.59-$3.63 billion for full-year 2024.
- Adjusted EPS guidance for full-year 2024: $0.31-$0.37.
- Net sales from continuing operations decreased by 4%.
- GAAP operating loss from continuing operations was $(63) million.
- SG&A expenses increased by 29%.
-
Reports solid second-quarter results with better-than-expected performance in
U.S. innerwear business. -
Announced agreement to sell global Champion business and completed exit of
U.S. outlet stores in July. Both businesses moved to discontinued operations in second-quarter 2024. - These strategic actions fundamentally strengthen the Company, creating a more focused, simplified business with more consistent revenue growth, higher margins, strong cash generation, a strong competitive position, and multiple levers to unlock shareholder value over the next several years.
-
Adjusts full-year 2024 guidance to reflect continuing operations, with continued visibility for strong profit and EPS growth. Provides third-quarter 2024 guidance. Company expects to pay down approximately
$1 billion - Earnings presentation, including a bridge from second-quarter results to prior guidance, and recast historical financials are available on the Company’s investor relations website.
“We delivered solid second-quarter results in a challenging consumer and apparel market, including better-than-expected
Second Quarter 2024 Continuing Operations Results Summary
-
Beginning in second-quarter 2024, global Champion and
U.S. outlet store businesses have been reclassified to discontinued operations. -
Net sales from continuing operations decreased
4% compared to prior year as sales declines continued to moderate, as expected. On an organic, constant-currency basis, net sales decreased1% . -
Gained an additional 40 basis points of innerwear market share in the
U.S. as increased marketing investments and product innovation continued to drive point-of-sale trends that outperformed the market. -
With the divestiture of global Champion, the Company is taking action to create the right cost structure for a simpler, more focused business. The Company recognized restructuring and other action-related charges and has specific plans in place to deliver a step-function change in its overall cost structure, including consolidation actions within its supply chain. These actions are expected to further reduce cost and improve operational efficiencies across the organization. As a result, GAAP operating loss from continuing operations was
$(63) million $(0.39) -
Adjusting for restructuring and other action-related charges, adjusted operating profit from continuing operations increased
46% over prior year to$126 million 650% to$0.15 -
Generated
$78 million -
Reduced its debt balance for the seventh consecutive quarter. Company expects to pay down approximately
$1 billion
Second-Quarter 2024 Results
-
Net Sales from continuing operations of
$995 million 4% compared to the prior year, with approximately 150 basis points due to the unfavorable impact from foreign exchange rates and approximately 130 basis points due to last year’sU.S. Sheer Hosiery divestiture. On an organic constant currency basis, net sales decreased approximately1% , or$11 million U.S. essentially offset by the expected macroeconomic headwinds inAustralia . -
Gross Profit and Gross Margin were
$307 million 30.8% , respectively. Adjusted Gross Profit, which excludes certain costs related to restructuring and other action-related charges, increased11% over last year to$396 million 39.8% increased approximately 525 basis points as compared to second-quarter 2023. The year-over-year improvement was driven primarily by lower input costs as the Company continues to anniversary the impact from peak inflation as well as the benefits from cost savings initiatives. -
Selling, General and Administrative (SG&A) Expenses increased
29% to$370 million $270 million 27.1% increased 100 basis points over prior year. The year-over-year increase was driven by a 125 basis point increase in brand marketing investments within theU.S. innerwear business, which was partially offset by benefits from cost savings initiatives and disciplined expense management. -
Operating Loss and Operating Margin in second-quarter 2024 were
$(63) million 46% over prior year to$126 million 12.7% as compared to second-quarter 2023. -
Interest Expense and Other Expenses for second-quarter 2024 were approximately
$50 million $11 million $59 million $7 million -
Tax Expense for second-quarter 2024 was
$12 million $13 million 19% , respectively. For second-quarter 2023, the effective and adjusted tax rates were323% and62% , respectively. The Company's effective tax rate for 2024 and 2023 is not reflective of theU.S. statutory rate due to valuation allowances against certain net deferred tax assets. -
Loss from continuing operations totaled approximately
$(137) million $(0.39) $(9) million $(0.03) $53 million $0.15 $8 million $0.02
See the Note on Adjusted Measures and Reconciliation to GAAP Measures later in this news release for additional discussion and details of actions, which include restructuring and other action-related charges.
Second-Quarter 2024 Business Segment Summary
Beginning with second-quarter 2024, the Company realigned its reporting segments to
-
U.S. net sales decreased1% as compared to prior year. Despite the expected market decline in the quarter, the Company’s strategy of consumer-centricity is working. The Company gained another 40 basis points of innerwear market share in the quarter as increased marketing investments as well as innovation in its Hanes, Maidenform andBali brands helped drive retail space gains, attract younger consumers, and generate point-of-sale trends that outperformed the market. In the quarter, its Hanes Originals and Maidenform M innovation product lines delivered strong year-over-over sales growth. The Company also launchedBali Breathe, its biggest innovation behind the brand in over a decade.
Operating margin of21.4% increased approximately 470 basis points over prior year. The increase was driven by lower input costs and benefits from cost savings initiatives, which helped fund a50% increase in brand marketing investments to drive consumer demand behind new product innovation in both Men’s and Women’s.
-
International net sales decreased approximately
4% on a reported basis, including$15 million 2% on a constant currency basis compared to prior year with growth in theAmericas andAsia more than offsetting the expected macroeconomic-driven decline inAustralia .
Operating margin of12.0% increased approximately 380 basis points compared to prior year driven by lower input costs and benefits from cost savings initiatives.
Cash Flow, Balance Sheet and Liquidity
-
Total liquidity position at the end of second-quarter 2024 was more than
$1.3 billion $214 million $1 billion - Based on the calculation as defined in the Company’s senior secured credit facility, the Leverage Ratio at the end of second-quarter 2024 was 4.6 times on a net debt-to-adjusted EBITDA basis, which was below its second-quarter 2024 covenant of 6.63 times and below 5.6 times at the end of second-quarter 2023 (See Table 6-B).
-
Inventory at the end of second-quarter 2024 of
$938 million 20% , or$235 million -
Cash Flow from Operations was
$78 million $88 million $71 million $78 million
Additional Information on Global Champion Business Sale
As announced on June 5, 2024, the Company has entered into a definitive agreement with Authentic Brands Group (ABG) to sell the global Champion business. As noted above, along with the
The Company is on-track to complete the sale of the global Champion business in the second half of 2024 and continues to expect net proceeds of approximately
Hanesbrands expects to continue operating the Champion
Third-Quarter and Full-Year 2024 Financial Outlook
Current 2024 guidance metrics, which are based on continuing operations and reflect the global Champion and
The Company is providing guidance on tax expense due to the expected fluctuation of its quarterly tax rate, stemming from the deferred tax reserve matter previously disclosed in fourth-quarter 2022. Importantly, the reserve does not impact cash taxes. Some portion of the reserve may reverse in future periods.
The Company closed the sale of its
For fiscal year 2024, which ends on December 28, 2024, the Company currently expects:
-
Net sales from continuing operations of approximately
$3.59 billion $3.63 billion $50 million U.S. Sheer Hosiery divestiture and approximately$40 million 4% decrease as compared to prior year on a reported basis and an approximate2% decrease on an organic constant currency basis. -
GAAP operating profit from continuing operations of approximately
$151 million $171 million -
Adjusted operating profit from continuing operations of approximately
$395 million $415 million $9 million -
Pretax charges for restructuring and other action-related charges of approximately
$244 million -
GAAP Interest expense of approximately
$210 million $10 million $200 million -
GAAP and Adjusted Other expenses of approximately
$40 million -
GAAP and Adjusted Tax expense of approximately
$45 million -
GAAP loss per share from continuing operations of approximately
$(0.41) $(0.35) -
Adjusted earnings per share from continuing operations of approximately
$0.31 $0.37 -
Cash flow from operations of approximately
$200 million -
Capital investments of approximately
$50 million $40 million $10 million $10 million $200 million -
Free cash flow of approximately
$160 million - Fully diluted shares outstanding of approximately 353 million.
For third-quarter 2024, which ends on September 28, 2024, the Company currently expects:
-
Net sales from continuing operations of approximately
$920 million $950 million $17 million U.S. Sheer Hosiery divestiture and approximately$4 million 3% decrease as compared to prior year on a reported basis and an approximate1% decrease on an organic constant currency basis. -
GAAP operating profit from continuing operations of approximately
$85 million $100 million -
Adjusted operating profit from continuing operations of approximately
$105 million $120 million $1 million -
Pretax charges for restructuring and other action-related charges of approximately
$20 million -
GAAP and Adjusted Interest expense of approximately
$50 million -
GAAP and Adjusted Other expenses of approximately
$10 million -
GAAP and Adjusted Tax expense of approximately
$12 million -
GAAP earnings per share from continuing operations of approximately
$0.03 $0.08 -
Adjusted earnings per share from continuing operations of approximately
$0.09 $0.14 - Fully diluted shares outstanding of approximately 354 million.
HanesBrands has updated its quarterly frequently-asked-questions document, which is available at www.Hanes.com/FAQ.
Note on Adjusted Measures and Reconciliation to GAAP Measures
To supplement financial results prepared in accordance with generally accepted accounting principles, the Company provides quarterly and full-year results concerning certain non‐GAAP financial measures, including adjusted diluted earnings (loss) per share from continuing operations, adjusted income (loss) from continuing operations, adjusted income tax expense, adjusted income (loss) from continuing operations before income taxes, adjusted operating profit (and margin), adjusted SG&A, adjusted gross profit (and margin), EBITDA, adjusted EBITDA, adjusted effective tax rate, adjusted interest expense and adjusted other expenses, net debt, leverage ratio and free cash flow.
Adjusted EPS is defined as diluted earnings (loss) per share from continuing operations excluding actions and the tax effect on actions. Adjusted income (loss) from continuing operations is defined as income (loss) from continuing operation excluding actions and the tax effect on actions. Adjusted income tax expense is defined as income tax expense excluding actions. Adjusted income (loss) from continuing operations before income taxes is defined as income (loss) from continuing operations before income tax excluding actions. Adjusted operating profit is defined as operating profit excluding actions. Adjusted SG&A is defined as selling, general and administrative expenses excluding actions. Adjusted gross profit is defined as gross profit excluding actions. Adjusted interest is defined as interest expense excluding actions. Adjusted other expenses is defined as other expenses excluding actions and adjusted effective tax rate is defined as adjusted income tax expense divided by adjusted income (loss) from continuing operations before income tax.
Charges for actions taken in 2024 and 2023, as applicable, include the supply chain restructuring and consolidation, corporate asset impairment, headcount actions and related severance charges, professional services, technology charges, gain/loss on classification of assets held for sale, loss on extinguishment of debt, gain on final settlement of cross currency swap contracts and the tax effects thereof.
While these costs are not expected to continue for any singular transaction on an ongoing basis, similar types of costs, expenses and charges have occurred in prior periods and may recur in future periods depending upon future business plans and circumstances.
HanesBrands has chosen to present these non‐GAAP measures to investors to enable additional analyses of past, present and future operating performance and as a supplemental means of evaluating operations absent the effect of our supply chain restructuring and consolidation and other actions that are deemed to be material stand-alone initiatives apart from the Company’s core operations. HanesBrands believes these non-GAAP measures provide management and investors with valuable supplemental information for analyzing the operating performance of the Company’s ongoing business during each period presented without giving effect to costs associated with the execution of any of the aforementioned actions taken.
The Company has also chosen to present EBITDA and adjusted EBITDA to investors because it considers these measures to be an important supplemental means of evaluating operating performance. EBITDA is defined as net income (loss) before the impacts of discontinued operations, interest, taxes, depreciation and amortization. Adjusted EBITDA is defined as EBITDA excluding (x) restructuring charges related to our supply chain restructuring and consolidation, and other action-related charges described in more detail in Table 6-A and (y) certain other losses, charges and expenses as defined in the Consolidated Net Total Leverage Ratio under its Fifth Amended and Restated Credit Agreement, dated November 19, 2021, as amended (the “Credit Agreement”) described in more detail in Table 6-B. HanesBrands believes that EBITDA and adjusted EBITDA are frequently used by securities analysts, investors and other interested parties in the evaluation of companies in the industry, and management uses EBITDA and adjusted EBITDA for planning purposes in connection with setting its capital allocation strategy. EBITDA and adjusted EBITDA should not, however, be considered as measures of discretionary cash available to invest in the growth of the business.
Net debt is defined as the total of current debt, long-term debt, and borrowings under the accounts receivable securitization facility (excluding long-term debt issuance costs and debt discount and borrowings of unrestricted subsidiaries under the accounts receivable securitization facility) less (x) other debt and cash adjustments and (y) cash and cash equivalents. Leverage ratio is the ratio of net debt to adjusted EBITDA as it is defined in our Credit Agreement.
The Company defines free cash flow as net cash from operating activities less capital expenditures. Management believes that free cash flow, which measures our ability to generate additional cash from our business operations, is an important financial measure for use in evaluating the Company's financial performance. The Company defines organic net sales as net sales excluding those derived from businesses acquired or divested within the previous 12 months of the reporting date.
HanesBrands is a global company that reports financial information in
To calculate foreign currency translation on a constant currency basis, operating results for the current-year period for entities reporting in currencies other than the
HanesBrands believes constant currency information is useful to management and investors to facilitate comparison of operating results and better identify trends in the Company’s businesses. The Company defines organic constant currency sales as net sales excluding those derived from businesses acquired or divested within the previous 12 months of the reporting date and also excluding the impact of translating foreign currencies into
Non‐GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as an alternative to, or substitute for, financial results prepared in accordance with GAAP. Further, the non-GAAP measures presented may be different from non-GAAP measures with similar or identical names presented by other companies.
Reconciliations of these non-GAAP measures to the most directly comparable GAAP financial measures are presented in the supplemental financial information included with this news release.
Cautionary Statement Concerning Forward-Looking Statements
This news release contains certain information that may constitute forward-looking statements, as defined under
About HanesBrands
HanesBrands (NYSE: HBI) makes everyday apparel that is known and loved by consumers around the world for comfort, quality and value. Among the Company’s iconic brands are Hanes, the leading basic apparel brand in
TABLE 1 |
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HANESBRANDS INC. |
|||||||||||||||||||||
Condensed Consolidated Statements of Operations |
|||||||||||||||||||||
(in thousands, except per share data) |
|||||||||||||||||||||
(Unaudited) |
|||||||||||||||||||||
|
Quarters Ended |
|
|
|
Six Months Ended |
|
|
||||||||||||||
|
June 29,
|
|
July 1,
|
|
% Change |
|
June 29,
|
|
July 1,
|
|
% Change |
||||||||||
Net sales |
$ |
995,393 |
|
|
$ |
1,035,004 |
|
|
(3.8 |
)% |
|
$ |
1,773,606 |
|
|
$ |
1,919,034 |
|
|
(7.6 |
)% |
Cost of sales |
|
688,320 |
|
|
|
678,211 |
|
|
|
|
|
1,157,218 |
|
|
|
1,279,862 |
|
|
|
||
Gross profit |
|
307,073 |
|
|
|
356,793 |
|
|
(13.9 |
)% |
|
|
616,388 |
|
|
|
639,172 |
|
|
(3.6 |
)% |
As a % of net sales |
|
30.8 |
% |
|
|
34.5 |
% |
|
|
|
|
34.8 |
% |
|
|
33.3 |
% |
|
|
||
Selling, general and administrative expenses |
|
370,202 |
|
|
|
286,860 |
|
|
29.1 |
% |
|
|
640,409 |
|
|
|
543,695 |
|
|
17.8 |
% |
As a % of net sales |
|
37.2 |
% |
|
|
27.7 |
% |
|
|
|
|
36.1 |
% |
|
|
28.3 |
% |
|
|
||
Operating profit (loss) |
|
(63,129 |
) |
|
|
69,933 |
|
|
(190.3 |
)% |
|
|
(24,021 |
) |
|
|
95,477 |
|
|
(125.2 |
)% |
As a % of net sales |
|
(6.3 |
)% |
|
|
6.8 |
% |
|
|
|
|
(1.4 |
)% |
|
|
5.0 |
% |
|
|
||
Other expenses |
|
10,785 |
|
|
|
7,239 |
|
|
|
|
|
20,014 |
|
|
|
21,977 |
|
|
|
||
Interest expense, net |
|
50,299 |
|
|
|
58,718 |
|
|
|
|
|
100,905 |
|
|
|
103,938 |
|
|
|
||
Income (loss) from continuing operations before income taxes |
|
(124,213 |
) |
|
|
3,976 |
|
|
|
|
|
(144,940 |
) |
|
|
(30,438 |
) |
|
|
||
Income tax expense |
|
12,332 |
|
|
|
12,826 |
|
|
|
|
|
22,215 |
|
|
|
29,006 |
|
|
|
||
Loss from continuing operations |
|
(136,545 |
) |
|
|
(8,850 |
) |
|
|
|
|
(167,155 |
) |
|
|
(59,444 |
) |
|
|
||
Income (loss) from discontinued operations, net of tax |
|
(161,835 |
) |
|
|
(13,614 |
) |
|
|
|
|
(170,347 |
) |
|
|
2,576 |
|
|
|
||
Net loss |
$ |
(298,380 |
) |
|
$ |
(22,464 |
) |
|
|
|
$ |
(337,502 |
) |
|
$ |
(56,868 |
) |
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Earnings (loss) per share - basic: |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Continuing operations |
$ |
(0.39 |
) |
|
$ |
(0.03 |
) |
|
|
|
$ |
(0.48 |
) |
|
$ |
(0.17 |
) |
|
|
||
Discontinued operations |
|
(0.46 |
) |
|
|
(0.04 |
) |
|
|
|
|
(0.48 |
) |
|
|
0.01 |
|
|
|
||
Net loss |
$ |
(0.85 |
) |
|
$ |
(0.06 |
) |
|
|
|
$ |
(0.96 |
) |
|
$ |
(0.16 |
) |
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Earnings (loss) per share - diluted: |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Continuing operations |
$ |
(0.39 |
) |
|
$ |
(0.03 |
) |
|
|
|
$ |
(0.48 |
) |
|
$ |
(0.17 |
) |
|
|
||
Discontinued operations |
|
(0.46 |
) |
|
|
(0.04 |
) |
|
|
|
|
(0.48 |
) |
|
|
0.01 |
|
|
|
||
Net loss |
$ |
(0.85 |
) |
|
$ |
(0.06 |
) |
|
|
|
$ |
(0.96 |
) |
|
$ |
(0.16 |
) |
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Weighted average shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic |
|
351,990 |
|
|
|
350,501 |
|
|
|
|
|
351,783 |
|
|
|
350,468 |
|
|
|
||
Diluted |
|
351,990 |
|
|
|
350,501 |
|
|
|
|
|
351,783 |
|
|
|
350,468 |
|
|
|
||
TABLE 2-A |
HANESBRANDS INC. |
Supplemental Financial Information |
Impact of Foreign Currency |
(in thousands, except per share data) |
(Unaudited) |
The following tables present a reconciliation of reported results on a constant currency basis for the quarter and six months ended June 29, 2024 and a comparison to prior year: |
|
Quarter Ended June 29, 2024 |
|
|
|
|
|
|
||||||||||||||
|
As Reported |
|
Impact from
|
|
Constant
|
|
Quarter
|
|
% Change,
|
|
% Change,
|
||||||||||
As reported under GAAP: |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net sales |
$ |
995,393 |
|
|
$ |
(15,194 |
) |
|
$ |
1,010,587 |
|
|
$ |
1,035,004 |
|
|
(3.8 |
)% |
|
(2.4 |
)% |
Gross profit |
|
307,073 |
|
|
|
(9,082 |
) |
|
|
316,155 |
|
|
|
356,793 |
|
|
(13.9 |
) |
|
(11.4 |
) |
Operating profit (loss) |
|
(63,129 |
) |
|
|
(3,596 |
) |
|
|
(59,533 |
) |
|
|
69,933 |
|
|
(190.3 |
) |
|
(185.1 |
) |
Diluted loss per share from continuing operations3 |
$ |
(0.39 |
) |
|
$ |
(0.01 |
) |
|
$ |
(0.38 |
) |
|
$ |
(0.03 |
) |
|
1,200.0 |
% |
|
1,166.7 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
As adjusted:2 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net sales |
$ |
995,393 |
|
|
$ |
(15,194 |
) |
|
$ |
1,010,587 |
|
|
$ |
1,035,004 |
|
|
(3.8 |
)% |
|
(2.4 |
)% |
Gross profit |
|
395,694 |
|
|
|
(9,082 |
) |
|
|
404,776 |
|
|
|
357,029 |
|
|
10.8 |
|
|
13.4 |
|
Operating profit |
|
126,126 |
|
|
|
(3,596 |
) |
|
|
129,722 |
|
|
|
86,628 |
|
|
45.6 |
|
|
49.7 |
|
Diluted earnings per share from continuing operations3 |
$ |
0.15 |
|
|
$ |
(0.01 |
) |
|
$ |
0.16 |
|
|
$ |
0.02 |
|
|
650.0 |
% |
|
700.0 |
% |
1 |
Effect of the change in foreign currency exchange rates year-over-year. Calculated by applying prior period exchange rates to the current year financial results. |
2 |
Results for the quarters ended June 29, 2024 and July 1, 2023 reflect adjustments for restructuring and other action-related charges. See "Reconciliation of Select GAAP Measures to Non-GAAP Measures" in Table 6-A. |
3 |
Amounts may not be additive due to rounding. |
|
Six Months Ended June 29, 2024 |
|
|
|
|
|
|
||||||||||||||
|
As Reported |
|
Impact from
|
|
Constant
|
|
Six Months
|
|
% Change,
|
|
% Change,
|
||||||||||
As reported under GAAP: |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net sales |
$ |
1,773,606 |
|
|
$ |
(30,558 |
) |
|
$ |
1,804,164 |
|
|
$ |
1,919,034 |
|
|
(7.6 |
)% |
|
(6.0 |
)% |
Gross profit |
|
616,388 |
|
|
|
(18,352 |
) |
|
|
634,740 |
|
|
|
639,172 |
|
|
(3.6 |
) |
|
(0.7 |
) |
Operating profit (loss) |
|
(24,021 |
) |
|
|
(6,686 |
) |
|
|
(17,335 |
) |
|
|
95,477 |
|
|
(125.2 |
) |
|
(118.2 |
) |
Diluted loss per share from continuing operations3 |
$ |
(0.48 |
) |
|
$ |
(0.01 |
) |
|
$ |
(0.46 |
) |
|
$ |
(0.17 |
) |
|
182.4 |
% |
|
170.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
As adjusted:2 |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net sales |
$ |
1,773,606 |
|
|
$ |
(30,558 |
) |
|
$ |
1,804,164 |
|
|
$ |
1,919,034 |
|
|
(7.6 |
)% |
|
(6.0 |
)% |
Gross profit |
|
705,212 |
|
|
|
(18,352 |
) |
|
|
723,564 |
|
|
|
640,924 |
|
|
10.0 |
|
|
12.9 |
|
Operating profit |
|
180,203 |
|
|
|
(6,686 |
) |
|
|
186,889 |
|
|
|
115,181 |
|
|
56.5 |
|
|
62.3 |
|
Diluted earnings per share from continuing operations3 |
$ |
0.11 |
|
|
$ |
(0.01 |
) |
|
$ |
0.12 |
|
|
$ |
(0.09 |
) |
|
(222.2 |
)% |
|
(233.3 |
)% |
1 |
Effect of the change in foreign currency exchange rates year-over-year. Calculated by applying prior period exchange rates to the current year financial results. |
2 |
Results for the six months ended June 29, 2024 and July 1, 2023 reflect adjustments for restructuring and other action-related charges. See "Reconciliation of Select GAAP Measures to Non-GAAP Measures" in Table 6-A. |
3 |
Amounts may not be additive due to rounding. |
TABLE 2-B |
HANESBRANDS INC. |
Supplemental Financial Information |
Organic Constant Currency |
(in thousands, except per share data) |
(Unaudited) |
The following tables present a reconciliation of reported results on an organic constant currency basis for the quarter and six months ended June 29, 2024 and a comparison to prior year: |
|
Quarter Ended June 29, 2024 |
|
Quarter Ended July 1, 2023 |
|
|
|
|
||||||||||||||||||||
|
As
|
|
Impact from
|
|
Less |
|
Organic
|
|
As
|
|
Less |
|
Organic |
|
% Change,
|
|
% Change,
|
||||||||||
Net sales |
$ |
995,393 |
|
$ |
(15,194 |
) |
|
$ |
— |
|
$ |
1,010,587 |
|
$ |
1,035,004 |
|
$ |
13,470 |
|
$ |
1,021,534 |
|
(3.8 |
)% |
|
(1.1 |
)% |
1 |
Effect of the change in foreign currency exchange rates year-over-year. Calculated by applying prior period exchange rates to the current year financial results. |
2 |
The Company sold its |
|
Six Months Ended June 29, 2024 |
|
Six Months Ended July 1, 2023 |
|
|
|
|
||||||||||||||||||||
|
As
|
|
Impact from
|
|
Less |
|
Organic
|
|
As
|
|
Less |
|
Organic |
|
% Change,
|
|
% Change,
|
||||||||||
Net sales |
$ |
1,773,606 |
|
$ |
(30,558 |
) |
|
$ |
— |
|
$ |
1,804,164 |
|
$ |
1,919,034 |
|
$ |
33,055 |
|
$ |
1,885,979 |
|
(7.6 |
)% |
|
(4.3 |
)% |
1 |
Effect of the change in foreign currency exchange rates year-over-year. Calculated by applying prior period exchange rates to the current year financial results. |
2 |
The Company sold its |
TABLE 3 |
|||||||||||||||||||||
HANESBRANDS INC. |
|||||||||||||||||||||
Supplemental Financial Information |
|||||||||||||||||||||
By Business Segment |
|||||||||||||||||||||
(in thousands) |
|||||||||||||||||||||
(Unaudited) |
|||||||||||||||||||||
|
Quarters Ended |
|
|
|
Six Months Ended |
|
|
||||||||||||||
|
June 29,
|
|
July 1,
|
|
% Change |
|
June 29,
|
|
July 1,
|
|
% Change |
||||||||||
Segment net sales: |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
$ |
740,154 |
|
|
$ |
751,049 |
|
|
(1.5 |
)% |
|
$ |
1,284,045 |
|
|
$ |
1,350,933 |
|
|
(5.0 |
)% |
International |
|
254,539 |
|
|
|
264,406 |
|
|
(3.7 |
) |
|
|
488,088 |
|
|
|
520,745 |
|
|
(6.3 |
) |
Other |
|
700 |
|
|
|
19,549 |
|
|
(96.4 |
) |
|
|
1,473 |
|
|
|
47,356 |
|
|
(96.9 |
) |
Total net sales |
$ |
995,393 |
|
|
$ |
1,035,004 |
|
|
(3.8 |
)% |
|
$ |
1,773,606 |
|
|
$ |
1,919,034 |
|
|
(7.6 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Segment operating profit: |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
$ |
158,214 |
|
|
$ |
125,154 |
|
|
26.4 |
% |
|
$ |
256,477 |
|
|
$ |
191,761 |
|
|
33.7 |
% |
International |
|
30,542 |
|
|
|
21,701 |
|
|
40.7 |
|
|
|
51,040 |
|
|
|
44,245 |
|
|
15.4 |
|
Other |
|
(130 |
) |
|
|
(1,721 |
) |
|
(92.4 |
) |
|
|
551 |
|
|
|
(212 |
) |
|
(359.9 |
) |
General corporate expenses/other |
|
(62,500 |
) |
|
|
(58,506 |
) |
|
6.8 |
|
|
|
(127,865 |
) |
|
|
(120,613 |
) |
|
6.0 |
|
Total operating profit before restructuring and other action-related charges |
|
126,126 |
|
|
|
86,628 |
|
|
45.6 |
|
|
|
180,203 |
|
|
|
115,181 |
|
|
56.5 |
|
Restructuring and other action-related charges |
|
(189,255 |
) |
|
|
(16,695 |
) |
|
1,033.6 |
|
|
|
(204,224 |
) |
|
|
(19,704 |
) |
|
936.5 |
|
Total operating profit (loss) |
$ |
(63,129 |
) |
|
$ |
69,933 |
|
|
(190.3 |
)% |
|
$ |
(24,021 |
) |
|
$ |
95,477 |
|
|
(125.2 |
)% |
|
Quarters Ended |
|
|
|
Six Months Ended |
|
|
||||||||||
|
June 29,
|
|
July 1,
|
|
Basis
|
|
June 29,
|
|
July 1,
|
|
Basis
|
||||||
Segment operating margin: |
|
|
|
|
|
|
|
|
|
|
|
||||||
|
21.4 |
% |
|
16.7 |
% |
|
471 |
|
|
20.0 |
% |
|
14.2 |
% |
|
578 |
|
International |
12.0 |
|
|
8.2 |
|
|
379 |
|
|
10.5 |
|
|
8.5 |
|
|
196 |
|
Other |
(18.6 |
) |
|
(8.8 |
) |
|
(977 |
) |
|
37.4 |
|
|
(0.4 |
) |
|
3,785 |
|
General corporate expenses/other |
(6.3 |
) |
|
(5.7 |
) |
|
(63 |
) |
|
(7.2 |
) |
|
(6.3 |
) |
|
(92 |
) |
Total operating margin before restructuring and other action-related charges |
12.7 |
|
|
8.4 |
|
|
430 |
|
|
10.2 |
|
|
6.0 |
|
|
416 |
|
Restructuring and other action-related charges |
(19.0 |
) |
|
(1.6 |
) |
|
(1,740 |
) |
|
(11.5 |
) |
|
(1.0 |
) |
|
(1,049 |
) |
Total operating margin |
(6.3 |
)% |
|
6.8 |
% |
|
(1,310 |
) |
|
(1.4 |
)% |
|
5.0 |
% |
|
(633 |
) |
TABLE 4 |
|||||||||||
HANESBRANDS INC. |
|||||||||||
Condensed Consolidated Balance Sheets |
|||||||||||
(in thousands) |
|||||||||||
(Unaudited) |
|||||||||||
|
June 29,
|
|
December 30,
|
|
July 1,
|
||||||
Assets |
|
|
|
|
|
||||||
Cash and cash equivalents |
$ |
213,767 |
|
|
$ |
185,717 |
|
|
$ |
173,415 |
|
Trade accounts receivable, net |
|
483,951 |
|
|
|
451,052 |
|
|
|
558,165 |
|
Inventories |
|
937,980 |
|
|
|
972,654 |
|
|
|
1,173,006 |
|
Other current assets |
|
189,347 |
|
|
|
117,057 |
|
|
|
155,262 |
|
Current assets held for sale |
|
460,863 |
|
|
|
549,735 |
|
|
|
831,849 |
|
Total current assets |
|
2,285,908 |
|
|
|
2,276,215 |
|
|
|
2,891,697 |
|
Property, net |
|
209,801 |
|
|
|
354,410 |
|
|
|
369,812 |
|
Right-of-use assets |
|
240,219 |
|
|
|
281,898 |
|
|
|
297,820 |
|
Trademarks and other identifiable intangibles, net |
|
936,294 |
|
|
|
959,851 |
|
|
|
955,786 |
|
Goodwill |
|
658,736 |
|
|
|
664,805 |
|
|
|
658,864 |
|
Deferred tax assets |
|
17,029 |
|
|
|
18,176 |
|
|
|
3,762 |
|
Other noncurrent assets |
|
126,385 |
|
|
|
139,151 |
|
|
|
142,398 |
|
Noncurrent assets held for sale |
|
905,472 |
|
|
|
945,808 |
|
|
|
958,892 |
|
Total assets |
$ |
5,379,844 |
|
|
$ |
5,640,314 |
|
|
$ |
6,279,031 |
|
|
|
|
|
|
|
||||||
Liabilities |
|
|
|
|
|
||||||
Accounts payable |
$ |
704,114 |
|
|
$ |
580,285 |
|
|
$ |
791,531 |
|
Accrued liabilities |
|
512,717 |
|
|
|
421,805 |
|
|
|
399,696 |
|
Lease liabilities |
|
65,136 |
|
|
|
70,490 |
|
|
|
67,731 |
|
Accounts Receivable Securitization Facility |
|
— |
|
|
|
6,000 |
|
|
|
149,000 |
|
Current portion of long-term debt |
|
44,250 |
|
|
|
59,000 |
|
|
|
59,000 |
|
Current liabilities held for sale |
|
240,263 |
|
|
|
252,988 |
|
|
|
261,130 |
|
Total current liabilities |
|
1,566,480 |
|
|
|
1,390,568 |
|
|
|
1,728,088 |
|
Long-term debt |
|
3,224,155 |
|
|
|
3,235,640 |
|
|
|
3,504,275 |
|
Lease liabilities - noncurrent |
|
217,483 |
|
|
|
239,686 |
|
|
|
252,944 |
|
Pension and postretirement benefits |
|
95,067 |
|
|
|
103,456 |
|
|
|
109,708 |
|
Other noncurrent liabilities |
|
93,705 |
|
|
|
123,918 |
|
|
|
206,534 |
|
Noncurrent liabilities held for sale |
|
118,551 |
|
|
|
127,693 |
|
|
|
129,522 |
|
Total liabilities |
|
5,315,441 |
|
|
|
5,220,961 |
|
|
|
5,931,071 |
|
|
|
|
|
|
|
||||||
Stockholders’ equity |
|
|
|
|
|
||||||
Preferred stock |
|
— |
|
|
|
— |
|
|
|
— |
|
Common stock |
|
3,516 |
|
|
|
3,501 |
|
|
|
3,498 |
|
Additional paid-in capital |
|
363,078 |
|
|
|
353,367 |
|
|
|
343,042 |
|
Retained earnings |
|
217,400 |
|
|
|
554,796 |
|
|
|
515,595 |
|
Accumulated other comprehensive loss |
|
(519,591 |
) |
|
|
(492,311 |
) |
|
|
(514,175 |
) |
Total stockholders’ equity |
|
64,403 |
|
|
|
419,353 |
|
|
|
347,960 |
|
Total liabilities and stockholders’ equity |
$ |
5,379,844 |
|
|
$ |
5,640,314 |
|
|
$ |
6,279,031 |
|
TABLE 5 |
|||||||||||||||
HANESBRANDS INC. |
|||||||||||||||
Condensed Consolidated Statements of Cash Flows |
|||||||||||||||
(in thousands) |
|||||||||||||||
(Unaudited) |
|||||||||||||||
|
Quarters Ended |
|
Six Months Ended |
||||||||||||
|
June 29,
|
|
July 1,
|
|
June 29,
|
|
July 1,
|
||||||||
Operating Activities: |
|
|
|
|
|
|
|
||||||||
Net loss |
$ |
(298,380 |
) |
|
$ |
(22,464 |
) |
|
$ |
(337,502 |
) |
|
$ |
(56,868 |
) |
Adjustments to reconcile net loss to net cash from operating activities: |
|
|
|
|
|
|
|
||||||||
Depreciation |
|
22,304 |
|
|
|
18,343 |
|
|
|
39,978 |
|
|
|
35,703 |
|
Amortization of acquisition intangibles |
|
4,100 |
|
|
|
4,159 |
|
|
|
8,203 |
|
|
|
8,345 |
|
Other amortization |
|
2,899 |
|
|
|
3,593 |
|
|
|
6,198 |
|
|
|
6,398 |
|
Impairment of long-lived assets and goodwill |
|
76,604 |
|
|
|
— |
|
|
|
76,604 |
|
|
|
— |
|
Inventory write-down charges |
|
117,663 |
|
|
|
— |
|
|
|
117,663 |
|
|
|
— |
|
Loss on extinguishment of debt |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
8,466 |
|
Loss on classification of assets held for sale |
|
51,071 |
|
|
|
7,338 |
|
|
|
51,071 |
|
|
|
5,199 |
|
Amortization of debt issuance costs and debt discount |
|
2,561 |
|
|
|
2,266 |
|
|
|
5,105 |
|
|
|
4,239 |
|
Other |
|
16,103 |
|
|
|
6,635 |
|
|
|
13,722 |
|
|
|
11,837 |
|
Changes in assets and liabilities: |
|
|
|
|
|
|
|
||||||||
Accounts receivable |
|
(51,193 |
) |
|
|
(4,972 |
) |
|
|
(54,487 |
) |
|
|
46,671 |
|
Inventories |
|
17,529 |
|
|
|
125,095 |
|
|
|
(41,850 |
) |
|
|
132,956 |
|
Other assets |
|
7,088 |
|
|
|
(25,856 |
) |
|
|
(466 |
) |
|
|
(36,617 |
) |
Accounts payable |
|
30,964 |
|
|
|
(4,142 |
) |
|
|
134,029 |
|
|
|
39,029 |
|
Accrued pension and postretirement benefits |
|
80 |
|
|
|
1,461 |
|
|
|
261 |
|
|
|
2,940 |
|
Accrued liabilities and other |
|
79,033 |
|
|
|
(23,760 |
) |
|
|
86,068 |
|
|
|
(76,065 |
) |
Net cash from operating activities |
|
78,426 |
|
|
|
87,696 |
|
|
|
104,597 |
|
|
|
132,233 |
|
Investing Activities: |
|
|
|
|
|
|
|
||||||||
Capital expenditures |
|
(7,834 |
) |
|
|
(9,326 |
) |
|
|
(28,091 |
) |
|
|
(33,570 |
) |
Other |
|
3,625 |
|
|
|
103 |
|
|
|
3,653 |
|
|
|
19,047 |
|
Net cash from investing activities |
|
(4,209 |
) |
|
|
(9,223 |
) |
|
|
(24,438 |
) |
|
|
(14,523 |
) |
Financing Activities: |
|
|
|
|
|
|
|
||||||||
Borrowings on Term Loan Facilities |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
891,000 |
|
Repayments on Term Loan Facilities |
|
(14,750 |
) |
|
|
(8,500 |
) |
|
|
(29,500 |
) |
|
|
(14,750 |
) |
Borrowings on Accounts Receivable Securitization Facility |
|
467,000 |
|
|
|
463,000 |
|
|
|
980,500 |
|
|
|
1,051,000 |
|
Repayments on Accounts Receivable Securitization Facility |
|
(484,500 |
) |
|
|
(480,000 |
) |
|
|
(986,500 |
) |
|
|
(1,111,500 |
) |
Borrowings on Revolving Loan Facilities |
|
293,000 |
|
|
|
556,000 |
|
|
|
609,000 |
|
|
|
977,500 |
|
Repayments on Revolving Loan Facilities |
|
(293,000 |
) |
|
|
(627,500 |
) |
|
|
(609,000 |
) |
|
|
(1,088,500 |
) |
Borrowings on Senior Notes |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
600,000 |
|
Repayments on Senior Notes |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(1,436,884 |
) |
Payments to amend and refinance credit facilities |
|
(501 |
) |
|
|
(864 |
) |
|
|
(679 |
) |
|
|
(28,235 |
) |
Other |
|
214 |
|
|
|
(1,117 |
) |
|
|
(3,817 |
) |
|
|
(2,792 |
) |
Net cash from financing activities |
|
(32,537 |
) |
|
|
(98,981 |
) |
|
|
(39,996 |
) |
|
|
(163,161 |
) |
Effect of changes in foreign exchange rates on cash |
|
(195 |
) |
|
|
(869 |
) |
|
|
(12,963 |
) |
|
|
(1,130 |
) |
Change in cash and cash equivalents |
|
41,485 |
|
|
|
(21,377 |
) |
|
|
27,200 |
|
|
|
(46,581 |
) |
Cash and cash equivalents at beginning of period |
|
191,216 |
|
|
|
213,209 |
|
|
|
205,501 |
|
|
|
238,413 |
|
Cash and cash equivalents at end of period |
$ |
232,701 |
|
|
$ |
191,832 |
|
|
$ |
232,701 |
|
|
$ |
191,832 |
|
|
|
|
|
|
|
|
|
||||||||
Balances included in the Condensed Consolidated Balance Sheets: |
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents |
$ |
213,767 |
|
|
$ |
173,415 |
|
|
$ |
213,767 |
|
|
$ |
173,415 |
|
Cash and cash equivalents included in current assets held for sale |
|
18,934 |
|
|
|
18,417 |
|
|
|
18,934 |
|
|
|
18,417 |
|
Cash and cash equivalents at end of period |
$ |
232,701 |
|
|
$ |
191,832 |
|
|
$ |
232,701 |
|
|
$ |
191,832 |
|
1 |
The cash flows related to discontinued operations have not been segregated and remain included in the major classes of assets and liabilities. Accordingly, the Condensed Consolidated Statements of Cash Flows include the results of continuing and discontinued operations. |
TABLE 6-A |
HANESBRANDS INC. |
Supplemental Financial Information |
Reconciliation of Select GAAP Measures to Non-GAAP Measures |
(in thousands, except per share data) |
(Unaudited) |
The following tables present a reconciliation of results from continuing operations as reported under GAAP to the results from continuing operations as adjusted for the quarter and six months ended June 29, 2024 and a comparison to prior year. The Company has chosen to present the following non-GAAP measures to investors to enable additional analyses of past, present and future operating performance and as a supplemental means of evaluating continuing operations absent the effect of restructuring and other actions that are deemed to be material stand-alone initiatives apart from the Company’s core operations. While these costs are not expected to continue for any individual transaction on an ongoing basis, similar types of costs, expenses and charges have occurred in prior periods and may recur in future periods depending upon future business plans and circumstances.
Restructuring and other action-related charges in 2024 and 2023 include the following: |
Supply chain restructuring and consolidation |
In 2024, represents charges as a result of the pending sale of the global Champion business and the completed exit of the |
Corporate asset impairment charges |
Primarily represents charges related to a contract terminated in the second quarter of 2024 and impairment of the Company’s headquarters location that was classified as held for sale in the second quarter of 2024. |
Headcount actions and related severance |
Represents charges related to operating model initiatives primarily headcount actions and related severance charges and adjustments related to restructuring activities. |
Professional services |
Represents professional fees, primarily including consulting and advisory services, related to restructuring activities. |
Technology |
Represents technology charges related to the implementation of the Company’s technology modernization initiative which includes a global enterprise resource planning platform. |
Gain/loss on classification of assets held for sale |
Represents the gain/loss to adjust the valuation allowance related to the |
Loss on extinguishment of debt |
Represents charges related to the redemption of the Company’s |
Gain on final settlement of cross currency swap contracts |
Primarily represents the remaining gain related to cross-currency swap contracts previously designated as cash flow hedges in accumulated other comprehensive loss which was released into earnings as the Company unwound the cross-currency swap contracts in connection with the redemption of the |
Tax effect on actions |
Represents the applicable effective tax rate on the restructuring and other action-related charges based on the jurisdiction of where the charges were incurred. |
|
Quarters Ended |
|
Six Months Ended |
||||||||||||
|
June 29,
|
|
July 1,
|
|
June 29,
|
|
July 1,
|
||||||||
Gross profit, as reported under GAAP |
$ |
307,073 |
|
|
$ |
356,793 |
|
|
$ |
616,388 |
|
|
$ |
639,172 |
|
As a % of net sales |
|
30.8 |
% |
|
|
34.5 |
% |
|
|
34.8 |
% |
|
|
33.3 |
% |
Restructuring and other action-related charges: |
|
|
|
|
|
|
|
||||||||
Supply chain restructuring and consolidation |
|
78,226 |
|
|
|
236 |
|
|
|
78,393 |
|
|
|
1,752 |
|
Corporate asset impairment charges |
|
10,395 |
|
|
|
— |
|
|
|
10,395 |
|
|
|
— |
|
Headcount actions and related severance |
|
— |
|
|
|
— |
|
|
|
36 |
|
|
|
— |
|
Gross profit, as adjusted |
$ |
395,694 |
|
|
$ |
357,029 |
|
|
$ |
705,212 |
|
|
$ |
640,924 |
|
As a % of net sales |
|
39.8 |
% |
|
|
34.5 |
% |
|
|
39.8 |
% |
|
|
33.4 |
% |
|
Quarters Ended |
|
Six Months Ended |
||||||||||||
|
June 29,
|
|
July 1,
|
|
June 29,
|
|
July 1,
|
||||||||
Selling, general and administrative expenses, as reported under GAAP |
$ |
370,202 |
|
|
$ |
286,860 |
|
|
$ |
640,409 |
|
|
$ |
543,695 |
|
As a % of net sales |
|
37.2 |
% |
|
|
27.7 |
% |
|
|
36.1 |
% |
|
|
28.3 |
% |
Restructuring and other action-related charges: |
|
|
|
|
|
|
|
||||||||
Supply chain restructuring and consolidation |
|
(78,581 |
) |
|
|
— |
|
|
|
(80,521 |
) |
|
|
— |
|
Corporate asset impairment charges |
|
(9,712 |
) |
|
|
— |
|
|
|
(9,712 |
) |
|
|
— |
|
Headcount actions and related severance |
|
(6,911 |
) |
|
|
(2,760 |
) |
|
|
(19,062 |
) |
|
|
(1,889 |
) |
Professional services |
|
(3,544 |
) |
|
|
(3,608 |
) |
|
|
(4,034 |
) |
|
|
(3,648 |
) |
Technology |
|
(218 |
) |
|
|
(2,881 |
) |
|
|
(399 |
) |
|
|
(7,102 |
) |
Loss on classification of assets held for sale |
|
— |
|
|
|
(7,338 |
) |
|
|
— |
|
|
|
(5,199 |
) |
Other |
|
(1,668 |
) |
|
|
128 |
|
|
|
(1,672 |
) |
|
|
(114 |
) |
Selling, general and administrative expenses, as adjusted |
$ |
269,568 |
|
|
$ |
270,401 |
|
|
$ |
525,009 |
|
|
$ |
525,743 |
|
As a % of net sales |
|
27.1 |
% |
|
|
26.1 |
% |
|
|
29.6 |
% |
|
|
27.4 |
% |
|
Quarters Ended |
|
Six Months Ended |
||||||||||||
|
June 29,
|
|
July 1,
|
|
June 29,
|
|
July 1,
|
||||||||
Operating profit (loss), as reported under GAAP |
$ |
(63,129 |
) |
|
$ |
69,933 |
|
|
$ |
(24,021 |
) |
|
$ |
95,477 |
|
As a % of net sales |
|
(6.3 |
)% |
|
|
6.8 |
% |
|
|
(1.4 |
)% |
|
|
5.0 |
% |
Restructuring and other action-related charges: |
|
|
|
|
|
|
|
||||||||
Supply chain restructuring and consolidation |
|
156,807 |
|
|
|
236 |
|
|
|
158,914 |
|
|
|
1,752 |
|
Corporate asset impairment charges |
|
20,107 |
|
|
|
— |
|
|
|
20,107 |
|
|
|
— |
|
Headcount actions and related severance |
|
6,911 |
|
|
|
2,760 |
|
|
|
19,098 |
|
|
|
1,889 |
|
Professional services |
|
3,544 |
|
|
|
3,608 |
|
|
|
4,034 |
|
|
|
3,648 |
|
Technology |
|
218 |
|
|
|
2,881 |
|
|
|
399 |
|
|
|
7,102 |
|
Loss on classification of assets held for sale |
|
— |
|
|
|
7,338 |
|
|
|
— |
|
|
|
5,199 |
|
Other |
|
1,668 |
|
|
|
(128 |
) |
|
|
1,672 |
|
|
|
114 |
|
Operating profit, as adjusted |
$ |
126,126 |
|
|
$ |
86,628 |
|
|
$ |
180,203 |
|
|
$ |
115,181 |
|
As a % of net sales |
|
12.7 |
% |
|
|
8.4 |
% |
|
|
10.2 |
% |
|
|
6.0 |
% |
|
Quarters Ended |
|
Six Months Ended |
|||||||||
|
June 29,
|
|
July 1,
|
|
June 29,
|
|
July 1,
|
|||||
Interest expense, net and other expenses, as reported under GAAP |
$ |
61,084 |
|
$ |
65,957 |
|
$ |
120,919 |
|
$ |
125,915 |
|
Restructuring and other action-related charges: |
|
|
|
|
|
|
|
|||||
Loss on extinguishment of debt |
|
— |
|
|
— |
|
|
— |
|
|
(8,466 |
) |
Gain on final settlement of cross currency swaps |
|
— |
|
|
— |
|
|
— |
|
|
1,370 |
|
Interest expense, net and other expenses, as adjusted |
$ |
61,084 |
|
$ |
65,957 |
|
$ |
120,919 |
|
$ |
118,819 |
|
|
Quarters Ended |
|
Six Months Ended |
||||||||||||
|
June 29,
|
|
July 1,
|
|
June 29,
|
|
July 1,
|
||||||||
Income (loss) from continuing operations before income taxes, as reported under GAAP |
$ |
(124,213 |
) |
|
$ |
3,976 |
|
|
$ |
(144,940 |
) |
|
$ |
(30,438 |
) |
Restructuring and other action-related charges: |
|
|
|
|
|
|
|
||||||||
Supply chain restructuring and consolidation |
|
156,807 |
|
|
|
236 |
|
|
|
158,914 |
|
|
|
1,752 |
|
Corporate asset impairment charges |
|
20,107 |
|
|
|
— |
|
|
|
20,107 |
|
|
|
— |
|
Headcount actions and related severance |
|
6,911 |
|
|
|
2,760 |
|
|
|
19,098 |
|
|
|
1,889 |
|
Professional services |
|
3,544 |
|
|
|
3,608 |
|
|
|
4,034 |
|
|
|
3,648 |
|
Technology |
|
218 |
|
|
|
2,881 |
|
|
|
399 |
|
|
|
7,102 |
|
Loss on classification of assets held for sale |
|
— |
|
|
|
7,338 |
|
|
|
— |
|
|
|
5,199 |
|
Other |
|
1,668 |
|
|
|
(128 |
) |
|
|
1,672 |
|
|
|
114 |
|
Loss on extinguishment of debt |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
8,466 |
|
Gain on final settlement of cross currency swaps |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(1,370 |
) |
Income (loss) from continuing operations before income taxes, as adjusted |
$ |
65,042 |
|
|
$ |
20,671 |
|
|
$ |
59,284 |
|
|
$ |
(3,638 |
) |
|
Quarters Ended |
|
Six Months Ended |
||||||||||||
|
June 29,
|
|
July 1,
|
|
June 29,
|
|
July 1,
|
||||||||
Loss from continuing operations, as reported under GAAP |
$ |
(136,545 |
) |
|
$ |
(8,850 |
) |
|
$ |
(167,155 |
) |
|
$ |
(59,444 |
) |
Restructuring and other action-related charges: |
|
|
|
|
|
|
|
||||||||
Supply chain restructuring and consolidation |
|
156,807 |
|
|
|
236 |
|
|
|
158,914 |
|
|
|
1,752 |
|
Corporate asset impairment charges |
|
20,107 |
|
|
|
— |
|
|
|
20,107 |
|
|
|
— |
|
Headcount actions and related severance |
|
6,911 |
|
|
|
2,760 |
|
|
|
19,098 |
|
|
|
1,889 |
|
Professional services |
|
3,544 |
|
|
|
3,608 |
|
|
|
4,034 |
|
|
|
3,648 |
|
Technology |
|
218 |
|
|
|
2,881 |
|
|
|
399 |
|
|
|
7,102 |
|
Loss on classification of assets held for sale |
|
— |
|
|
|
7,338 |
|
|
|
— |
|
|
|
5,199 |
|
Other |
|
1,668 |
|
|
|
(128 |
) |
|
|
1,672 |
|
|
|
114 |
|
Loss on extinguishment of debt |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
8,466 |
|
Gain on final settlement of cross currency swaps |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(1,370 |
) |
Tax effect on actions |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Income (loss) from continuing operations, as adjusted |
$ |
52,710 |
|
|
$ |
7,845 |
|
|
$ |
37,069 |
|
|
$ |
(32,644 |
) |
|
Quarters Ended1 |
|
Six Months Ended1 |
||||||||||||
|
June 29,
|
|
July 1,
|
|
June 29,
|
|
July 1,
|
||||||||
Diluted loss per share from continuing operations, as reported under GAAP |
$ |
(0.39 |
) |
|
$ |
(0.03 |
) |
|
$ |
(0.48 |
) |
|
$ |
(0.17 |
) |
Restructuring and other action-related charges: |
|
|
|
|
|
|
|
||||||||
Supply chain restructuring and consolidation |
|
0.44 |
|
|
|
0.00 |
|
|
|
0.45 |
|
|
|
0.00 |
|
Corporate asset impairment charges |
|
0.06 |
|
|
|
— |
|
|
|
0.06 |
|
|
|
— |
|
Headcount actions and related severance |
|
0.02 |
|
|
|
0.01 |
|
|
|
0.05 |
|
|
|
0.01 |
|
Professional services |
|
0.01 |
|
|
|
0.01 |
|
|
|
0.01 |
|
|
|
0.01 |
|
Technology |
|
0.00 |
|
|
|
0.01 |
|
|
|
0.00 |
|
|
|
0.02 |
|
Loss on classification of assets held for sale |
|
— |
|
|
|
0.02 |
|
|
|
— |
|
|
|
0.01 |
|
Other |
|
0.00 |
|
|
|
0.00 |
|
|
|
0.00 |
|
|
|
0.00 |
|
Loss on extinguishment of debt |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
0.02 |
|
Gain on final settlement of cross currency swaps |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
0.00 |
|
Tax effect on actions |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Diluted earnings (loss) per share from continuing operations, as adjusted |
$ |
0.15 |
|
|
$ |
0.02 |
|
|
$ |
0.11 |
|
|
$ |
(0.09 |
) |
1 |
Amounts may not be additive due to rounding. |
TABLE 6-B |
|||||||
HANESBRANDS INC. |
|||||||
Supplemental Financial Information |
|||||||
Reconciliation of Select GAAP Measures to Non-GAAP Measures |
|||||||
(in thousands, except per share data) |
|||||||
(Unaudited) |
|||||||
|
Last Twelve Months |
||||||
|
June 29,
|
|
July 1,
|
||||
Leverage Ratio: |
|
|
|
||||
|
|
|
|
||||
EBITDA1: |
|
|
|
||||
Loss from continuing operations |
$ |
(71,942 |
) |
|
$ |
(512,826 |
) |
Interest expense, net |
|
211,260 |
|
|
|
177,737 |
|
Income tax expense (benefit) |
|
(20,701 |
) |
|
|
477,435 |
|
Depreciation and amortization |
|
84,793 |
|
|
|
80,044 |
|
Total EBITDA |
|
203,410 |
|
|
|
222,390 |
|
Total restructuring and other action-related charges (excluding tax effect on actions)2 |
|
207,319 |
|
|
|
70,311 |
|
Other net losses, charges and expenses3 |
|
96,060 |
|
|
|
118,533 |
|
Total EBITDA from discontinued operations, as adjusted4 |
|
165,532 |
|
|
|
223,822 |
|
Total EBITDA, as adjusted |
$ |
672,321 |
|
|
$ |
635,056 |
|
|
|
|
|
||||
Net debt: |
|
|
|
||||
Debt (current and long-term debt and Accounts Receivable Securitization Facility excluding long-term debt issuance costs and debt discount of |
$ |
3,301,250 |
|
|
$ |
3,750,750 |
|
(Less) debt related to an unrestricted subsidiary5 |
|
— |
|
|
|
— |
|
Other debt and cash adjustments6 |
|
3,957 |
|
|
|
3,587 |
|
(Less) Cash and cash equivalents of continuing operations |
|
(213,767 |
) |
|
|
(173,415 |
) |
(Less) Cash and cash equivalents of discontinued operations |
|
(18,934 |
) |
|
|
(18,417 |
) |
Net debt |
$ |
3,072,506 |
|
|
$ |
3,562,505 |
|
|
|
|
|
||||
Debt/Loss from continuing operations7 |
|
(45.9 |
) |
|
|
(7.3 |
) |
|
|
|
|
||||
Net debt/EBITDA, as adjusted8 |
|
4.6 |
|
|
|
5.6 |
|
1 |
Earnings before interest, taxes, depreciation and amortization (EBITDA) is a non-GAAP financial measure. |
2 |
The last twelve months ended June 29, 2024 includes |
3 |
Represents other net losses, charges and expenses that can be excluded from the Company’s leverage ratio as defined under its Fifth Amended and Restated Credit Agreement, dated November 19, 2021, as amended. The last twelve months ended June 29, 2024, primarily includes |
4 |
Represents Total EBITDA from discontinued operations, as adjusted for all items that can be excluded from the Company’s leverage ratio as defined under its Fifth Amended and Restated Credit Agreement, dated November 19, 2021, as amended. |
5 |
Represents amounts outstanding under an existing accounts receivable securitization facility entered into by an unrestricted subsidiary of the Company. |
6 |
Includes drawn and undrawn letters of credit, financing leases and cash balances in certain geographies. |
7 |
Represents Debt divided by Loss from continuing operations, which is the most comparable GAAP financial measure to Net debt/EBITDA, as adjusted. |
8 |
Represents the Company’s leverage ratio defined as Consolidated Net Total Leverage Ratio under its Fifth Amended and Restated Credit Agreement, dated November 19, 2021, as amended, which excludes other net losses, charges and expenses in addition to restructuring and other action-related charges. |
|
Quarters Ended |
|
Six Months Ended |
||||||||||||
|
June 29,
|
|
July 1,
|
|
June 29,
|
|
July 1,
|
||||||||
Free cash flow1: |
|
|
|
|
|
|
|
||||||||
Net cash from operating activities |
$ |
78,426 |
|
|
$ |
87,696 |
|
|
$ |
104,597 |
|
|
$ |
132,233 |
|
Capital expenditures |
|
(7,834 |
) |
|
|
(9,326 |
) |
|
|
(28,091 |
) |
|
|
(33,570 |
) |
Free cash flow |
$ |
70,592 |
|
|
$ |
78,370 |
|
|
$ |
76,506 |
|
|
$ |
98,663 |
|
1 |
Free cash flow includes the results from continuing and discontinued operations for all periods presented. |
TABLE 7 |
|||
HANESBRANDS INC. |
|||
Supplemental Financial Information |
|||
Reconciliation of GAAP Outlook to Adjusted Outlook |
|||
(in thousands, except per share data) |
|||
(Unaudited) |
|||
|
Quarter Ended |
|
Year Ended |
|
September 28,
|
|
December 28,
|
Operating profit outlook, as calculated under GAAP |
|
|
|
Restructuring and other action-related charges outlook |
20,000 |
|
244,000 |
Operating profit outlook, as adjusted |
|
|
|
|
|
|
|
Interest expense, net outlook, as calculated under GAAP |
|
|
|
Restructuring and other action-related charges outlook |
— |
|
10,000 |
Interest expense, net outlook, as adjusted |
|
|
|
|
|
|
|
Diluted earnings (loss) per share from continuing operations outlook, as calculated under GAAP1 |
|
|
|
Restructuring and other action-related charges outlook |
0.06 |
|
0.72 |
Diluted earnings per share from continuing operations outlook, as adjusted |
|
|
|
|
|
|
|
Cash flow from operations outlook, as calculated under GAAP |
|
|
|
Capital expenditures outlook |
|
|
40,000 |
Free cash flow outlook |
|
|
|
1 |
The Company expects approximately 354 million diluted weighted average shares outstanding for the quarter ended September 28, 2024 and approximately 353 million diluted weighted average shares outstanding for the year ended December 28, 2024. |
The Company is unable to reconcile projections of financial performance beyond 2024 without unreasonable efforts, because the Company cannot predict, with a reasonable degree of certainty, the type and extent of certain items that would be expected to impact these figures in 2024 and beyond, such as net sales, operating profit, tax rates and action related charges.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240808584772/en/
News Media contact: Nicole Ducouer (336) 986-7090
Analysts and Investors contact: T.C. Robillard (336) 519-2115
Source: HanesBrands
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