The market seems to be muted on
) third-quarter 2013 performance as the stock fell marginally by
0.4% within a day of the earnings announcement. The company
posted quarterly earnings of $1.12 per share that beat the Zacks
Consensus Estimate of $1.09 and rose 9.8% from the prior-year
However, on a reported basis, earnings fell 2% to 97 cents a
share, reflecting the impact of office consolidation expenses,
revaluation and amortization.
Carter's, one of the leading providers of clothing and related
products for kids, reported nets sales of $760.2 million that
surged 13.7% on the back of its compelling brands, promotional
strategies and multi-channel business model. Net Sales also
handily surpassed the Zacks Consensus Estimate of $750 million.
Gross profit rose 14.7% to $309.6 million with the margin
increasing 30 basis points to 40.7% of net sales. Adjusted
operating income for the quarter saw a year-over-year rise of
7.1% to $104.2 million from $97.3 million, with the margin
falling approximately 90 basis points to 13.7% of sales.
Carter's retail sales increased 15.5% to $251.0 million owing
to increment in sales worth $19.2 million from new outlets, 52.5%
rise in sales from e-Commerce operations and a 0.5% rise in
same-store sales. These were partly offset by store closures,
which reduced sales by $1 million. Wholesale sales went up 15.6%
to $318.6 million
OshKosh B'gosh retail sales rose 4.9% to $81.9 million, backed by
a 38.8% rise in e-Commerce sales, sales benefit of $2.8 million
from new outlets and a 1% increase in same-store sales, partly
offset by a $2.8 million decline in sales owing to store
closures. Wholesale sales declined 13.1% to $24.6 million.
International sales advanced 21.1% to $84.1 million owing to the
robust performance of the company's wholesale channel and
Canadian retail segment. However, same-store sales dropped 3.6%.
Alongside, the segment reported sales worth $3.9 million from its
During the third quarter of 2013, 17 new Carter's retail
stores were opened bringing the number to 455 and 7 new OshKosh
B'gosh retail stores taking the count to 170 in the United
ANTA SPORTS PRD (ANPDF): Get Free Report
BROWN SHOE CO (BWS): Free Stock Analysis
CARTERS INC (CRI): Free Stock Analysis Report
DECKERS OUTDOOR (DECK): Free Stock Analysis
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Other Financial Updates
On Aug 12, 2013 Carter's issued senior notes worth $400 million
bearing a coupon rate of 5.25% due Aug 15, 2021. Carter's took
this initiative to enhance its capital structure. On account of
this, the company received net amount of $394.2 million.
In the third quarter, the company bought back 226,400 shares for
$16.4 million. Under its accelerated stock repurchase program the
company bought back roughly 4.6 million shares worth $328.4
million, as of Sep 28, 2013.
This biggest marketer of babies' and kids' apparel and other
related items in America ended the quarter with cash and cash
equivalents of $201.8 million, long-term debt of $586.0 million
and shareholders' equity of $658.9 million.
For the final quarter of 2013, the management envisions a 9-10%
increase in net sales and a 10-15% rise in the adjusted earnings
a share, compared to the last quarter of 2012.
For full-year 2013, Carter's estimates net sales and adjusted
earnings per share to be up by 10% and roughly 15-17% from 2012,
Other Stocks to Consider
Carter's Inc.'s carries a Zacks Rank #3 (Hold). However, some
other companiesin the shoes and related apparel sector that
warrant a look include
Brown Shoe Co. Inc.
), with a Zacks Rank #1 (Strong Buy) and
ANTA Sports Products Ltd
Deckers Outdoor Corp.
), both carrying a Zacks Rank #2 (Buy).