Carter’s(US:CRI)2025-10-27 10:19Financial Performance - Net sales for Q3 fiscal 2025 were $758 million, comparable to the prior year, with a slight decrease of $0.6 million or 0.1%[5][9] - Diluted EPS for Q3 fiscal 2025 was $0.32, down from $1.62 in Q3 fiscal 2024; adjusted diluted EPS was $0.74 compared to $1.64 in the prior year[5][13][14] - Operating income decreased by $47.9 million, or 62.2%, to $29.1 million, with an operating margin of 3.8%, down from 10.2% in the previous year[11][12] - Adjusted net income for Q3 fiscal 2025 was $26.8 million, down from $59.0 million in Q3 fiscal 2024[14] - The Company reported a net income of $11.6 million for the fiscal quarter ended September 27, 2025, compared to $58.3 million in the prior year[39] - For the fiscal quarter ended September 27, 2025, the net income was $11.6 million, a decrease of 80% compared to $58.3 million for the same quarter in 2024[55] - The diluted net income per common share for the quarter was $0.32, down from $1.62 in the prior year, reflecting a 80% decline[55] - Adjusted EBITDA for the fiscal quarter was $52.3 million, compared to $91.1 million in the same quarter of 2024, representing a 42.6% decrease[57] - For the three fiscal quarters ended September 27, 2025, consolidated net sales totaled $1,973.0 million, down 0.6% from $1,984.4 million in the prior year[62] Segment Performance - U.S. Retail segment net sales increased by 2.6%, while U.S. Wholesale segment net sales decreased by 5.1%[10] - U.S. Retail net sales for the quarter were $362.3 million, representing 47.8% of total net sales, compared to 46.5% in the prior year[42] - U.S. Wholesale net sales decreased to $283.8 million, accounting for 37.4% of total net sales, down from 39.5% year-over-year[42] - International segment net sales for the quarter were $111.7 million, showing a 4.9% increase compared to $106.5 million in the same quarter of 2024[62] Cash Flow and Liquidity - Net cash used in operations in the first three quarters of fiscal 2025 was $136.3 million, compared to net cash provided by operations of $11.3 million in the same period of fiscal 2024[20] - The company reported a net cash used in operating activities of $136,310 thousand for the three fiscal quarters ended September 27, 2025, compared to a net cash provided of $11,319 thousand in the prior year[49] - Cash and cash equivalents decreased to $184,190 thousand from $412,926 thousand, representing a decline of 55.5%[49] Cost Management and Restructuring - The company plans to reduce its office-based roles by approximately 300 positions, or 15%, by the end of 2025, expecting annualized savings of about $35 million starting in 2026[23][24] - The Company is targeting over $10 million in annual SG&A spending reductions, with savings expected to begin in 2026[30] - The company obtained commitments for a new five-year asset-based revolving credit facility with initial borrowing commitments of no less than $750 million[26] - The company reported a total of $19.1 million in adjustments to EBITDA for the fiscal quarter, primarily related to organizational restructuring and pension plan settlements[57] Store Closures and Sales Impact - The Company plans to close approximately 150 stores in North America over the next three years, increasing from a previous target of 100 stores, which collectively represent about $110 million in annual net sales[30] Shareholder Returns - The company returned $47 million to shareholders through dividends in the first three quarters of fiscal 2025[5][21] - The company paid dividends totaling $47,247 thousand during the three fiscal quarters ended September 27, 2025, compared to $87,345 thousand in the prior year, a decrease of 46.0%[49] Guidance and Future Outlook - The Company has suspended its fiscal 2025 guidance due to ongoing uncertainty regarding tariffs and their potential impact on business[31] - The Company will hold a conference call on October 27, 2025, to discuss third quarter results and provide business updates[32] Assets and Liabilities - Total assets increased to $2,469,439 thousand as of September 27, 2025, compared to $2,433,167 thousand a year earlier, reflecting a growth of 1.4%[47] - Total current liabilities slightly decreased to $501,690 thousand from $508,816 thousand, a reduction of 2.2%[47] - Total shareholders' equity increased to $864,642 thousand from $854,562 thousand, a growth of 1.3% year-over-year[47] Capital Expenditures - Capital expenditures for the three fiscal quarters ended September 27, 2025, were $42,662 thousand, up from $39,637 thousand in the previous year, indicating an increase of 5.7%[49]