US: Carter's warns on costs as Q4 profit up 5.8%
- Q4 profit up 5.8% to $34.9m
- Net sales rose 17% to $495m
- 2011 earnings "expected to be lower"
Strong wholesale and retail demand for its Carter's and OshKosh B'gosh brands has helped Carter's Inc to a 5.8% rise in fourth quarter profit - but the children's wear maker warned that higher product costs are likely to dent earnings in the year ahead.
"We expect continued growth in sales in 2011, though earnings are expected to be lower due to historically high cotton prices and rising labour and freight costs," said Michael D Casey, chairman and CEO.
Net income rose to $34.9m or $0.60 per share in the fourth quarter, from $33.0m or $0.56 per share, in the same period last year.
Sales increased 16.6% to $495.3m, led by a 21.4% gain at its Carter's brands and a 1.1% rise at its OshKosh B'gosh label. Wholesale sales increased 25.4% to $157.7m, while retail sales were up 11.1% to $243.5m.
The company also sells its Child of Mine brand to Walmart and Just One You brand to Target, and booked a 23.5% rise in sales in this channel to $73.0m.
For the full year, net income climbed 26.7%, to $146.5m or $2.46 per share, from $115.6m or $1.97 per share, the year before. Net sales increased 10.0% to $1.7bn.
Looking ahead to the first quarter, the company, which operates 306 Carter's and 180 OshKosh retail stores, expects earnings per share to be $0.45 to $0.50 on sales of between $450m and $460m.
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