HanesBrands, the parent of Hanes, Champion and Gear for Sports, on Tuesday celebrated its first decade of success as an independent publicly traded company by ringing the opening bell of the New York Stock Exchange.
Since company executives first rang the NYSE opening bell exactly 10 years ago today to inaugurate the first day of trading, Hanes noted that has grown into a Fortune 500 and S&P 500 company that has delivered significant shareholder return, generated strong sales and profit growth, and earned numerous awards for corporate social responsibility.
In that span, the company’s stock went from a split-adjusted closing price of $5.28 on Sept. 6, 2006, to a closing price of $26.40 on Friday, Sept. 2, 2016, the last day of trading before the company’s 10th anniversary.
Hanes Chairman and Chief Executive Officer Richard A. Noll and Chief Operating Officer and CEO-Elect Gerald W. Evans Jr. led an executive team ringing the bell and then returning to the company’s Winston-Salem headquarters to lead an employee celebration. The rest of the company’s 70,000 worldwide commercial and supply chain employees located in more than 40 countries also are holding anniversary celebrations today.
“I could not be prouder of our organization and our 70,000 employees across the globe,” said Noll, who lead the company in its spinoff as an independent company and rang the NYSE opening bell a decade ago. “Together, we have built the world’s largest and best basic apparel company that has the best brands, the best supply chain, the best business processes, and the absolute best employees.”
Evans added, “The business strategies that have served us well over the past decade will remain the foundation for our future success. We will continue to focus on sales and profitability growth in the evolving global marketplace, as well as brand building, innovation, acquisitions, supply chain excellence, cash-flow generation, and value-generating capital allocation.”
The company has numerous successes over the past decade, including weathering the greatest recession in a generation and historic input inflation. In honor of the company’s 10th anniversary, here is a Top 10 list of success stories.
One Company, One Vision. At the time of the spinoff, Hanes operated as a collection of businesses, but Noll, Evans and their leadership team rallied the organization to think and act as one company with one strategic mantra: Sell More, Spend Less and Generate Cash. Not only has the company generated growth and delivered impressive financial results, but it was named to Forbes magazine’s 2016 America’s Best Large Employers list based on independent input from employees.
Brand Building. After the spinoff, the company increased its investment in its brands. Hanes products are found in more than 8 of 10 American households and have migrated upward in the retail landscape, now being sold all the way from dollar stores to mass merchants to midtier national chains to department stores. Champion has grown to be the No. 3 activewear brand in the United States. The company holds the No. 1 or No. 2 market position for either underwear, intimate apparel, hosiery or activewear in 12 countries.
Supply Chain Excellence. In the apparel industry, Hanes is one of the few companies to own the majority of its supply chain production. In the past decade, Hanes has recapitalized and relocated its supply chain to be balanced across the Western and Eastern Hemispheres. A decade ago, the company had a few hundred employees in all of Asia, and today the company has more than 12,000 in Vietnam alone.
Innovate to Elevate. In the past decade, Hanes followed up on its highly successful Tagless Tee initiative to launch ComfortFlex Bras, ComfortBlend fabrics, X-Temp temperature control products, and FreshIQ odor protection products across numerous brands and product categories. The company leverages its brands, supply chain and R&D strengths to generate category-leading innovations to drive shelf space and market share.
Acquisitions, Integration Expertise. Hanes’ solid balance sheet and capital position has allowed it to make value-generating acquisitions around the globe. The company has made several major acquisitions, including Gear for Sports, Maidenform, and Knights Apparel in the United States; DBApparel and Champion Europe in Europe; and Pacific Brands in Australia. Hanes uses its innovation platforms, scale, and company-owned supply chain to drive profitability growth in acquired businesses.
Net Sales and Profit Growth. Through 2015, the company’s net sales have increased by 30 percent from 10 years ago. The profitability of the Innerwear and Activewear segments has grown significantly. Innerwear’s operating profit margin has increased from 12.8 percent in 2009 to 22.7 percent in 2015, while Activewear’s operating profit margin increased from 5 percent in 2009 to 16.1 percent in 2015.
International Growth. The company’s International segment has more than doubled in size in the past decade, increasing from approximately 10 percent of sales to approximately 20 percent last year. With the acquisitions of Pacific Brands and Champion Europe, both competed this year, the percentage of sales from International operations will again increase.
Strong Capital Structure. Hanes has significantly de-risked the company’s balance sheet since its spinoff by reducing debt leverage by more than half. This has allowed it to deploy capital for dividends, acquisitions and share buybacks. The company benefits from strong cash flow and successful working capital management.
Corporate Social Responsibility Leader. Hanes values and protects its strong reputation for ethical business practices around the world, including workplace practices, code of conduct implementation, community building and philanthropy, safety, and environmental leadership. A member of the Fair Labor Association, Hanes also has been recognized by leading organizations, including the U.S. EPA, Great Place to Work Institute, Free2Work, Glasswing International, As You Sow, the United Way, and Newsweek magazine’s green company rankings. The company’s corporate social responsibility program, known as Hanes for Good, may be reviewed at www.HanesForGood.com.
Value Creation. Hanes has generated significant shareholder return as a public company. The company’s stock price and market capitalization have more than quintupled. The company instituted a regular quarterly cash dividend in April 2013 and has more than doubled it via three increases. The company has generated $3.2 billion of cash from operations since its spinoff through 2015.
HanesBrands, based in Winston-Salem, N.C., owns Hanes, Champion, Playtex, DIM, Bali, Maidenform, Bonds, JMS/Just My Size, L’eggs, Wonderbra, Nur Die/Nur Der, Lovable, Berlei, and Gear for Sports. The company sells T-shirts, bras, panties, shapewear, underwear, socks, hosiery and activewear.
