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Hanes Reports Sales, Announces Acquisition

North Carolina-based HanesBrands (asi/59528) announced 2017 Q4 growth of 4%, which increased revenue to $1.65 billion. Organic sales, which exclude acquisitions under a year old, were up 2%. The apparel company also announced healthy full-year net sales, which were up by 7%, reaching $6.47 billion overall.

“2017 was a successful year during which we focused on diversifying our business to be able to consistently deliver annual topline growth,” said Gerald W. Evans Jr., CEO of Hanes. “We have additional work to do, including addressing inflationary and short-term cost pressures, but our brands are strong, our key market shares are increasing, our international businesses are sizable and growing, and we are driving significant direct-to-consumer growth worldwide.”

Hanes’ activewear sales increased 9% in Q4 and 3% for the full year. The company’s acquisition of Alternative Apparel in October 2017 contributed $18 million in sales to the segment. Sales of Champion products, particularly the Champion Life line of products and reverse-weave fleece, helped drive fourth-quarter sales growth, according to the firm’s earnings release. Online sales of activewear were up 27% in the fourth quarter. 

In addition to releasing end-of-year earnings, Hanes also announced an agreement to acquire Bras N Things, a leading specialty retailer and online seller of intimate apparel in Australia, New Zealand and South Africa. The all-cash transaction is valued at about $400 million in U.S. dollars on an enterprise-value basis. The pending acquisition is expected to be part of 2018 earnings. 

“Bras N Things has a great business model that appeals to millennial consumers featuring core products supplemented by seasonal product offerings,” Evans said. “This consumer-direct sales model has significant potential for expansion into other geographic markets.”