HanesBrands Earning Surprise

Hanesbrands Profit Rises on Higher SalesThursday January 31, 5:13 pm ET By Ieva M. Augstums, AP Business Writer
Higher Apparel Sales, Cost-Cutting Help Double Profit for Wonderbra Maker

CHARLOTTE, N.C. (AP) -- Hanesbrands Inc., the maker of Hanes Brand underwear and the Wonderbra, said Thursday its profit more than doubled in its fourth quarter as a result of increased sales and cost-reduction efforts.

While pleased with his company's performance, Hanesbrands Chief Executive Officer Richard A. Noll said it's still a "tough consumer climate."
"It has been very challenging out there for the last four to six months and we continue to expect it will be challenging," Noll said on a conference call with analysts. "What is working is sticking to our strategy of driving our brands."
Hanesbrands shares rose 85 cents, or 3.4 percent, to $25.61 Thursday.
The Winston-Salem-based apparel maker earned $49.8 million, or 52 cents per share, for the three months ended Dec. 29 versus $23.8 million, or 25 cents per share, a year ago.
Excluding charges from plant closings, spinoff and related charges and other expenses, net income was $36.3 million, or 38 cents per share.

The three analysts polled by Thomson Financial expected profits of 39 cents per share. Estimates typically exclude one-time charges.
Revenue grew 2.4 percent to $1.16 billion from $1.13 billion during the year ago period.
Hanesbrands was spun off by former parent Sara Lee Corp. in 2006.
The company said increased sales from its Hanes, Champion and Bali brands helped results, with the Champion brand recording double-digit sales growth for three consecutive years.
Operating profit for the quarter rose 31 percent to $125.9 million, from $96.2 million a year ago.

"One of our strategies is to invest in our largest and strongest brands with innovative key items supported by great media," Noll said. "This strategy is delivering results."
As part of continued investment in its brands, the company recently launched a new advertising campaign for its Champion brand, the first campaign for the athletic apparel line since 2003. In October, Hanesbrands signed a 10-year marketing deal with The Walt Disney Co. that includes product co-branding, attraction sponsorships and signage at Disney parks and resorts.
As part of its global supply chain strategy, Hanesbrands in December acquired the Inversiones Bonaventure SA de CV hosiery sewing operations in Las Lourdes, El Salvador. The 900-employee plant had been a contract sewing supplier for Hanesbrands for 12 years.