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Hanesbrands posts 10% drop in Q1 EPS

Hanesbrands Inc. on May 1 reported mixed first-quarter results, with net income and net sales growth offset by the impact of federal tax reform on EPS.

For the three months ended March 31, the North Carolina-based apparel company's adjusted EPS excluding actions was 26 cents, down 10% from 29 cents in the year-ago period and ahead of the S&P Global Market Intelligence consensus estimate for normalized EPS of 24 cents.

Hanes attributed the difference to a higher corporate tax rate than it had a year ago due to the tax reform.

First-quarter net income came in at $79.4 million, up 12.5% year over year from $70.6 million and well above the S&P Global Market Intelligence consensus estimate for GAAP net income of $66.1 million.

Hanes' net sales for the quarter increased 6.6% to $1.47 billion from $1.38 billion in the year-ago period.

CEO Gerald Evans Jr. said in a statement: "We are reaping ongoing benefits from diversifying our business through geographic expansion, Champion brand growth globally, and increased sales in the online channel."

In addition, the company reaffirmed its guidance for full year 2018, expecting net sales of $6.72 billion to $6.82 billion and adjusted EPS excluding actions in the range of $1.72 to $1.80.

Hanes also released its second-quarter outlook, with net sales expected to be between $1.70 billion and $1.73 billion and adjusted EPS excluding actions of 44 to 46 cents.