In The Two Quarter, Net Profit Exceeded Expectations. Champion Still Surged 50%.

American underwear and sportswear group HanesBrands Inc. (NYSE:HBI) (referred to as HBI) two quarter net profit exceeded expectations, 154 million US dollars or earnings per share of 0.42 dollars, compared with the same period in 2018 140 million 600 thousand US dollars or earnings per share of 0.39 US dollars increased 9.5%.

The adjusted EPS was $0.45, better than the $0.44 expected by Zacks. Quarterly income of $1 billion 760 million 900 thousand, also slightly more than Zacks's expected $1 billion 750 million, was 2.7% higher than the 1 billion 715 million 400 thousand quarter of the two quarter of last year, and the growth rate of fixed exchange rate 5% was a positive performance for eighth consecutive quarters.

Champion champion global brand business rose more than 50%, still the main driving force of HBI's continuous growth, but it was significantly slower than the 75% in the first quarter, the same as last year's last quarter. Only in the US public sector C9 by Champion period, there was a 8% increase in revenue. The sportswear Department of the brand grew by 10.5% to $448 million 300 thousand in the two quarter, and the international business also benefited from the 4.2% increase in the brand to 568 million 900 thousand dollars, the fixed exchange rate more than 10%, and the underwear business income down 2.3% to 678 million 600 thousand dollars.

Sportswear business, driven by Champion, surged 19.6% to $68 million 779 thousand in the two quarter, compared with $57 million 508 thousand in the same period in 2018, operating profit margins improved by 120 basis points to 15.3% on a year by year basis, and international business profits increased by 81 million 78 thousand US dollars, increasing by 5.9% per annualized year, and operating margins increased by 20 basis points to 14.3%.

In the two quarter, HBI's overall operating profit increased by 6.3% to 234 million US dollars. After adjustment, its operating profit increased by 0.6%, from 245 million 200 thousand US dollars to 246 million 600 thousand US dollars, and adj operating profit contracted by 30 basis points to 14%.

As of the two quarter ended in June 29th, HBI operating cash flow rose 114.8%, from $63 million 745 thousand to $136 million 900 thousand, and debt leverage (/adj EBITDA) improved to 3.5 times from 3.9 at the end of last year. The company reiterated its goal of falling to 2.9 times by the end of the year.

Gerald Evans, the group's chief executive, praised Champion's global brand business, international market and DTC performance in its earnings report, and said it expected to achieve mid or high expectations in the whole year.

Headquartered in North Carolina, the company's annual revenue is expected to remain unchanged at 68.85-69.85 billion, representing an increase of 2%; the expected operating profit is 9.00-9.30 billion, adjusted by 9.55-9.85 billion, representing 5% and 2% growth respectively; EPS expects 1.59-1.67 US dollars, adj EPS pre scheduled 1.72-1.80 US dollars, representing 7% and 3% growth respectively; operating cash flow is expected to grow 17% to $200 billion.

For the current fiscal season, HBI expects revenue of 18.4-18.75 billion, operating profit is expected to be 2.64-2.74y billion, adjusted 2.76-2.86 US dollars, EPS expects us $0.49-0.52, adj EPS expects us $0.52-0.55.

Driven by performance, HanesBrands Inc. (NYSE:HBI) shares surged 5.53% before Thursday's opening. As of Wednesday's close, the stock has recorded a 28.41% gain this year, winning a 20.20% increase in the same period in the S & P 500 index.