Hanesbrands responds to activist investor's call for change, reiterates commitment to boosting shareholder value

Hanesbrands Inc. (HBI) responded to activist investor Barington Capital's urging for change, by reiterating its priority to deliver "sustainable value creation for shareholders." Barington said the "destruction in value" resulting from the stock's plunge over the past year was due to the underwear maker's "largely ineffective response" to market challenges, poor operating performance and excessive debt. Barington urged the company to "immediately" cut expenses by at least $300 million a year, reduce inventories to less than 170 days outstanding by year end and improve gross margins by further consolidating facilities. The Wall Street Journal had reported earlier about Barington's calls for change. "The Board and management team believe initiatives that are being executed as part of the Company's Full Potential plan will unlock significant opportunities, which we look forward to discussing later this week as part of our second quarter 2023 earnings report. We are also, however, open-minded with regard to additional paths to improve performance and create value," HanesBrands said in a statement. The stock, which hiked up 2.7% toward a five-month high in premarket trading, has tumbled 54.6% over the past 12 months through Monday, while the S&P 500 has gained 9.1%.

-Tomi Kilgore

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08-08-23 0821ET

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