Hanesbrands Inc. ( HBI Quick Quote HBI - Free Report) announced its strategic multi-year license agreement with G-III Apparel Group, Ltd. ( GIII Quick Quote GIII - Free Report) for design, production and distribution of outerwear for the Champion and C9 Champion brands in North America. The partnership also aims to explore opportunities in the Champion’s global network. Hanesbrands will leverage G-III’s impressive category expansion skills, expertise in the outerwear segment, best-in-class global infrastructure and diversified distribution network. Through the association, management expects to reach a more extensive consumer base. Certainly, Hanesbrands’ association with G-III Apparel will likely add another leaf to its growth story. G-III Apparel, a global leader in fashion, undertakes several strategies, including acquisitions and licensing of well-known brands, to expand its product portfolio and make itself a diversified apparel and accessories company. GIII remains on track with bolstering brands across channels, with new launches, improved marketing strategies and broader consumer reach. It is progressing well with the optimization of sourcing strategies. Image Source: Zacks Investment Research
In other news, Hanesbrands recently revealed that it has signed a multiyear extension of its current apparel partnership with Florida State University, as the college football begins. The company holds exclusive rights to Florida State fanwear in the mass retail channel per the agreement. In addition, the partnership aims at collaborative retail activations.
Hanesbrands has been grappling with a rising inflationary environment, which continued in the second quarter of 2023. Net sales and earnings declined year over year. Adjusted gross margin contracted nearly 425 basis points (bps) on commodity and ocean freight inflation. Unfavorable business mix and increased labor rates were also hurdles.
Considering the challenging apparel market, mainly in Australia, along with softness in the U.S. activewear category, management lowered its view for the back half of the year. For 2023, net sales from continuing operations are now anticipated to be $5.80-$5.90 billion, down from $6.05-$6.20 billion expected earlier. Adjusted earnings per share from continuing operations is envisioned to be in the 16-30 cents range compared with the 31-42 cents projected earlier. Shares of the Zacks Rank #4 (Sell) company have declined 8% in the past six months against the industry’s 5.3% growth. Eye These Solid Picks
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