hbi-20240330

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 30, 2024


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number: 001-32891

Hanesbrands Inc.

(Exact name of registrant as specified in its charter)


Maryland		20-3552316
(State of incorporation)		(I.R.S. employer identification no.)

1000 East Hanes Mill Road
Winston-Salem,	North Carolina	27105
(Address of principal executive office)		(Zip code)

(336) 519-8080

(Registrant’s telephone number including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock, Par Value $0.01	HBI	New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of May 3, 2024, there were 351,563,309 shares of the registrant’s common stock outstanding.

Table of Contents

TABLE OF CONTENTS


		Page
Forward-Looking Statements		1

PART I
Item 1.	Financial Statements (unaudited):
	Condensed Consolidated Statements of Operations for the quarters ended March 30 , 2024 and April 1, 2023	2
	Condensed Consolidated Statements of Comprehensive Income (Loss) for the quarters ended March 30, 2024 and April 1, 2023	3
	Condensed Consolidated Balance Sheets at Mar ch 30, 2024, Dec ember 30, 2023 and April 1, 2023	4
	Condensed Consolidated Statements of Stockholders’ Equity for the quarters ended March 30, 2024 and April 1, 2023	5
	Condensed Consolidated Statements of Cash Flows for the quarters ended March 30, 2024 and April 1, 2023	6
	Notes to Condensed Consolidated Financial Statements	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	24
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	32
Item 4.	Controls and Procedures	32

PART II
Item 1.	Legal Proceedings	34
Item 1A.	Risk Factors	34
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	34
Item 3.	Defaults Upon Senior Securities	34
Item 4.	Mine Safety Disclosures	34
Item 5.	Other Information	34
Item 6.	Exhibits	35
Signatures		36

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FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains information that may constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 (the “Exchange Act”). Forward-looking statements include all statements that do not relate solely to historical or current facts, and can generally be identified by the use of words such as “may,” “believe,” “could,” “will,” “expect,” “outlook,” “potential,” “project,” “estimate,” “future,” “intend,” “anticipate,” “plan,” “continue” or similar expressions. However, the absence of these words or similar expressions does not mean that a statement is not forward-looking. All statements regarding our intent, belief and current expectations about our strategic direction, prospects and future results are forward-looking statements and are subject to risks and uncertainties that could cause actual results to differ materially from those implied or expressed by such statements. These risks and uncertainties include, but are not limited to, trends associated with our business; our ability to implement successfully, or at all, our multi-year transformation strategy (“Full Potential transformation plan”) and our global Champion performance plan; our ability to identify, execute, and realize benefits, successfully, or at all, from any potential strategic transaction involving Champion; the rapidly changing retail environment and the level of consumer demand; the effects of any geopolitical conflicts (including the ongoing Russia-Ukraine conflict and Middle East conflicts) or public health emergencies or severe global health crises, including effects on consumer spending, global supply chains, critical supply routes and the financial markets; our ability to deleverage on the anticipated time frame or at all, which could negatively impact our ability to satisfy the financial covenants in our credit agreement or other contractual arrangements; any inadequacy, interruption, integration failure or security failure with respect to our information technology; future intangible assets or goodwill impairment due to changes in our business, market conditions, or other factors, including any sale of the Champion business; significant fluctuations in foreign exchange rates; legal, regulatory, political and economic risks related to our international operations; our ability to effectively manage our complex international tax structure; and our future financial performance. Management believes that these forward-looking statements are reasonable as and when made. However, caution should be taken not to place undue reliance on any such forward-looking statements. Such statements speak only as of the date when made and we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

More information on factors that could cause actual results or events to differ materially from those anticipated is included from time to time in our reports filed with the Securities and Exchange Commission, including our Annual Report on Form 10-K for the year ended December 30, 2023, under the caption “Risk Factors”, and available on the “Investors” section of our corporate website, www.Hanes.com/investors. The contents of our corporate website are not incorporated by reference in this Quarterly Report on Form 10-Q.

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PART I


Item 1.			Financial Statements

HANESBRANDS INC.

Condensed Consolidated Statements of Operations

(in thousands, except per share data)

(unaudited)


	Quarters Ended
	March 30, 2024		April 1, 2023
Net sales	$	1,156,201	$	1,389,410
Cost of sales	695,274		939,717
Gross profit	460,927		449,693
Selling, general and administrative expenses	408,821		392,374
Operating profit	52,106		57,319
Other expenses	9,271		14,771
Interest expense, net	66,689		58,452
Loss before income taxes	(23,854)		(15,904)
Income tax expense	15,268		18,500


Net loss	$	(39,122)	$	(34,404)

Loss per share:


Basic	$	(0.11)	$	(0.10)




Diluted	$	(0.11)	$	(0.10)

See accompanying notes to Condensed Consolidated Financial Statements.

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HANESBRANDS INC.

Condensed Consolidated Statements of Comprehensive Income (Loss)

(in thousands)

(unaudited)


	Quarters Ended
	March 30, 2024		April 1, 2023
Net loss	$	(39,122)	$	(34,404)
Other comprehensive income (loss):
Translation adjustments	(58,020)		(9,056)
Unrealized gain (loss) on qualifying cash flow hedges, net of tax of $(891) and $941, respectively	10,244		(21,644)
Unrecognized income from pension and postretirement plans, net of tax of $203 and $121, respectively	4,214		4,186
Total other comprehensive loss	(43,562)		(26,514)
Comprehensive loss	$	(82,684)	$	(60,918)

See accompanying notes to Condensed Consolidated Financial Statements.

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HANESBRANDS INC.

Condensed Consolidated Balance Sheets

(in thousands, except share and per share data)

(unaudited)


	March 30, 2024		December 30, 2023		April 1, 2023
Assets
Cash and cash equivalents	$	191,216	$	205,501	$	213,209
Trade accounts receivable, net	555,679		557,729		681,921
Inventories	1,419,309		1,368,018		1,969,133
Other current assets	157,510		144,967		159,724
Current assets held for sale	—		—		4,986
Total current assets	2,323,714		2,276,215		3,028,973
Property, net	398,089		414,366		442,315
Right-of-use assets	399,312		428,918		454,643
Trademarks and other identifiable intangibles, net	1,197,310		1,235,704		1,241,624
Goodwill	1,099,858		1,112,744		1,106,590
Deferred tax assets	21,003		21,954		21,732
Other noncurrent assets	150,390		150,413		136,803
Total assets	$	5,589,676	$	5,640,314	$	6,432,680

Liabilities and Stockholders’ Equity
Accounts payable	$	816,298	$	736,252	$	965,630
Accrued liabilities	477,524		478,676		474,840
Lease liabilities	103,867		110,640		100,266

Accounts Receivable Securitization Facility	17,500		6,000		166,000
Current portion of long-term debt	44,250		59,000		52,750
Current liabilities held for sale	—		—		4,986
Total current liabilities	1,459,439		1,390,568		1,764,472
Long-term debt	3,237,419		3,235,640		3,588,945
Lease liabilities - noncurrent	328,150		354,015		379,365
Pension and postretirement benefits	100,132		104,255		113,649
Other noncurrent liabilities	126,362		136,483		246,723
Total liabilities	5,251,502		5,220,961		6,093,154

Stockholders’ equity:
Preferred stock (50,000,000 authorized shares; $.01 par value)
Issued and outstanding — None	—		—		—
Common stock (2,000,000,000 authorized shares; $.01 par value)
Issued and outstanding — 351,562,227, 350,137,826 and 349,530,266, respectively	3,515		3,501		3,495
Additional paid-in capital	354,760		353,367		336,851
Retained earnings	515,772		554,796		537,702
Accumulated other comprehensive loss	(535,873)		(492,311)		(538,522)
Total stockholders’ equity	338,174		419,353		339,526
Total liabilities and stockholders’ equity	$	5,589,676	$	5,640,314	$	6,432,680

See accompanying notes to Condensed Consolidated Financial Statements.

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HANESBRANDS INC.

Condensed Consolidated Statements of Stockholders’ Equity

(in thousands, except per share data)

(unaudited)


	Common Stock			Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Loss		Total
	Shares	Amount
Balances at December 30, 2023	350,138	$	3,501	$	353,367	$	554,796	$	(492,311)	$	419,353
Net loss	—	—		—		(39,122)		—		(39,122)

SEC Form 10-Q filed by Hanesbrands Inc.