Carter’s, a leading US-based company in children's apparel, has reported a decrease in net sales by 4.9 per cent to $661.5 million in the first quarter of fiscal 2024 (Q1 FY24), down from $695.9 million in the same period last year. This decline was seen across its US retail, US wholesale, and international segments, which dropped 50 per cent, 5.7 per cent, and 2.7 per cent respectively. The company noted a 6.8 per cent decline in US retail comparable net sales. However, changes in foreign currency exchange rates had a slight positive impact, contributing approximately $2.0 million, or 0.3 per cent, to consolidated net sales.

Operating income saw a minor decrease of 2.3 per cent, amounting to $55 million compared to $56.4 million in the first quarter of fiscal 2023. Despite the drop in sales, the operating margin showed a slight improvement, rising to 8.3 per cent from 8.1 per cent in the previous year, the company said in a media release.

The company also reported a distinction between reported and adjusted operating income. Adjusted operating income, a non-GAAP measure, fell by 4.3 per cent to $55 million from $57.5 million year-over-year. The adjusted operating margin remained steady at 8.3 per cent, influenced by the same factors affecting the operating income.

On the profitability front, Carter’s saw an increase in net income, which rose by $2 million to $38 million, or $1.04 per diluted share, up from $36 million, or $0.95 per diluted share, a year earlier. Adjusted net income also improved, increasing by $1.2 million to $38 million, compared to $36.9 million in the prior year. The adjusted earnings per diluted share increased from $0.98 to $1.04.

“We exceeded our sales and earnings objectives in the first quarter,” said Michael D Casey, chairman and chief executive officer. “We continued to see higher and earlier than planned demand from our largest wholesale customers. We believe this demand reflects the leaner inventory positions at many retailers, and their need for our new seasonal product offerings in preparation for the warmer weather ahead.”

Fibre2Fashion News Desk (DP)

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