Carter's sales and profit decline in Q4

Carter’s, Inc. fourth quarter consolidated net sales decreased 150 million dollars or 14.1 percent to 912.1 million dollars.

The decline was driven by declines in the company’s U.S. retail, U.S. wholesale and international segments of 12.7 percent, 17.8 percent, and 12 percent, respectively.

“We saw stronger than expected demand for our brands in the final months of the year which enabled Carter’s to achieve its fourth quarter sales and earnings objectives,” said Michael D. Casey, the company’s chairman and CEO in a statement.

Carter’s net income drops 17.3 percent in Q4

U.S. retail comparable net sales declined 12.9 percent. Changes in foreign currency exchange rates, the company said, had an unfavourable effect on consolidated net sales of approximately 5.8 million dollars or 0.5 percent.

The company’s operating income decreased 28.4 million dollars or 20.6 percent to 109.5 million dollars, while operating margin decreased 100 basis points to 12 percent. Adjusted operating income decreased 19.3 million dollars or 14 percent to 118.5 million dollars, while adjusted operating margin was comparable to the prior year at 13 percent.

Net income decreased 16.8 million dollars or 17.3 percent to 80.2 million dollars, while diluted earnings per share decreased 8.7 percent to 2.11 dollars. Adjusted net income decreased 9.9 million dollars or 10.2 percent to 87 million dollars and adjusted diluted earnings per share decreased 0.9 percent to 2.29 dollars.

Carter’s FY22 net sales decrease 8 percent

Consolidated net sales for the fiscal year 2022 decreased 273.7 million dollars or 7.9 percent to 3.2 billion dollars.

The company added that U.S. retail net sales declined 11.5 percent, reflecting inflationary pressures driving lower consumer demand and the comparison to the prior year period, which benefited from significant and unprecedented government stimulus payments made to consumers in response to the pandemic.

U.S. retail comparable net sales declined 10.1 percent, U.S. wholesale and international net sales declined 4.1 percent and 1.9 percent, respectively.

Operating income in fiscal 2022 decreased 117.9 million dollars or 23.7 percent to 379.2 million dollars, while operating margin decreased 250 basis points to 11.8 percent.

Net income in fiscal 2022 decreased 89.7 million dollars or 26.4 percent to 250 million dollars, while diluted earnings per share decreased 18.8 percent to 6.34 dollars. Adjusted net income decreased 70.4 million dollars or 20.6 percent to 272 million dollars and adjusted earnings per diluted share decreased 12.3 percent to 6.90 dollars.

Carter’s announces FY23 and Q1 outlook

For the fiscal year 2023, the company expects 3 billion dollars in net sales, 350 million dollars in adjusted operating income compared to 388.2 million dollars in fiscal 2022; and 6.15 dollars in adjusted diluted earnings per share compared to 6.90 dollars in fiscal 2022.

For the first quarter of fiscal 2023, the company expects approximately 630 million dollars to 650 million dollars in net sales; 30 million dollars to 40 million dollars in adjusted operating income compared to 102.6 million dollars in the first quarter of fiscal 2022; and 35 cents to 55 cents in adjusted diluted earnings per share compared to 1.66 dollars in the first quarter of fiscal 2022.