Leading marketer of young children’s apparel in North America Carter's Inc has reported net sales of $695.9 million in the first quarter (Q1) of fiscal 2023 (FY23), down by $85.4 million or 10.9 per cent compared to the same period in the previous year. This has been attributed to macroeconomic factors, including inflation, that led to a decrease in demand from consumers and wholesale customers. The company’s US retail comparable net sales saw a decline of 12.9 per cent.

Operating income decreased by $46.3 million or 45.1 per cent to $56.4 million in Q1 FY23 compared to $102.6 million in Q1 FY22. Operating margin decreased from 13.1 per cent in the prior year period to 8.1 per cent. Adjusted operating income decreased $45.1 million, or 44.0 per cent, to $57.5 million, the company said in a press release.

Carter's net income decreased by $31.9 million to $36 million, or $0.95 per diluted share, in Q1 FY23 compared to $67.9 million or $1.66 per diluted share in Q1 FY22. The adjusted net income decreased by $31.1 million to $36.9 million, with adjusted earnings per diluted share being $0.98, compared to $1.66 in the first quarter of fiscal 2022.

For the second quarter of fiscal 2023, the company expects $590 million to $605 million in net sales, $30 million to $35 million in adjusted operating income, and $0.40 to $0.50 in adjusted diluted earnings per share. This is compared to $700.7 million in net sales, $75.4 million in adjusted operating income, and $1.30 in adjusted diluted earnings per share in Q2 FY22.

For fiscal 2023, Carter's expects approximately $3 billion in net sales, $350 million in adjusted operating income, and $6.15 in adjusted diluted earnings per share. This is compared to $3,212.7 million in net sales, $388.2 million in adjusted operating income, and $6.90 in adjusted diluted earnings per share in fiscal 2022, the release added.

Michael D. Casey, chairman and chief executive officer, said: “We exceeded our first quarter sales and earnings objectives. We saw higher than planned demand from some of our largest wholesale customers eager to receive our new spring product offerings in preparation for the shift to warmer weather outfitting. Our retail and international sales were in line with our plans.

“On-time deliveries of our product offerings sourced from Asia improved to the best performance we have experienced since the pandemic began and enabled us to support earlier than planned demand.”

Fibre2Fashion News Desk (DP)

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US firm Carter's net sales at $695.9 mn in Q1 FY23

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