• Q3 net profit up 14% to $125.3m
  • Net sales fall 2% to $1.2bn
  • Raises FY sales and earnings guidance

Apparel group Hanesbrands posted a double-digit third quarter profit increase, boosted by fatter margins and improved market share.

The US company said all four of its business segments had recorded double-digit operating margins in the three months to 28 September, while the group’s overall gross margin rose 240 basis points to 35.2%.

Innerwear sales fell 3% thanks to a negative back-to-school selling period, but achieved similar operating profit to last year despite increased media investments.

Activewear – previously known as outerwear – similarly delivered strong profitability in spite of a 3% revenue decline.

International net sales were up 10% on a constant currency basis, while direct-to-consumer sales edged up 1%.

Hanesbrands, which acquired rival Maidenform Brands on 7 October for US$583m, said it expected to complete much of the integration of the company by mid-2014, and all of it by the end of 2014, at which point Maidenform’s headquarters and distribution centre would be closed.

“We had a great quarter with record earnings and strong margins,” said Hanesbrands chairman and CEO Richard Noll.

“Our brands are gaining share, our supply chain is generating savings, and our product innovations are creating value.

“Given our strong earnings momentum, we are raising our earnings guidance for both 2013 and 2014 despite a soft retail environment.”

The company now expects fiscal 2013 sales of just over $4.6bn and adjusted earnings per share of $3.75-3.85. For fiscal 2014, it raised its EPS guidance figure from a low $4 range to $4.25-4.50.