Business news c: Hanesbrands Sees Sales Declining in First Quarter

Hanesbrands, the parent of Champion, announced that its board of directors has initiated a quarterly dividend as part of the company’s cash deployment strategy to drive additional shareholder value.

The Board authorized the regular quarterly dividend of $0.20 per share to be paid June 3, 2013, for stockholders of record at the close of business on May 20, 2013. The quarterly dividend is the first for Hanes since its spinoff as an independent public company in 2006.

“Initiating a quarterly dividend is a substantial company milestone made possible by strong strategic execution, successful debt reduction and cash-flow generation, and margin-improvement prospects,” Hanes Chairman and Chief Executive Officer Richard A. Noll said. “With our successful track record and long-term outlook, the Board decided it was time to institute a regular quarterly dividend.”

In conjunction with the dividend authorization disclosure and in advance of today’s previously scheduled investor meeting, the company decided to announce preliminary financial results for the first quarter ended March 30, 2013, and reaffirm full-year guidance for net sales, operating profit, earnings per diluted share and free cash flow.

The company expects to report first-quarter net sales of approximately $945 million; operating profit of $82 million to $85 million; and EPS of 48 to 51 cents a share. In the year-ago first quarter, it lost 25 cents a share on sales of $1.01 billion.

Hanes will release final first-quarter financial results at the close of trading on the New York Stock Exchange Tuesday, April 23, 2013.

Net sales for the first quarter were hampered by a sluggish retail environment as a result of delayed income tax returns and inclement weather compared with an early spring a year ago. However, the quarter’s operating profit margin will expand significantly, benefitting from the company’s Innovate-to-Elevate margin-enhancement initiatives built on strong brands, a low-cost supply chain, and innovation platforms.

For the full year, Hanes reaffirmed all of its 2013 guidance issued Feb. 5, 2013, including expectations for net sales of approximately $4.6 billion; operating profit of $500 million to $550 million; EPS of $3.25 to $3.40; and free cash flow of approximately $350 million to $450 million.

The company updated its guidance as part of its annual investors day presentation.

Source Hanesbrands through SportsOneSource