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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended April 2, 2022
or
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                     to                     
Commission file number: 001-32891
Hanesbrands Inc.
(Exact name of registrant as specified in its charter)
Maryland20-3552316
(State of incorporation)(I.R.S. employer identification no.)
1000 East Hanes Mill Road
Winston-Salem,North Carolina27105
(Address of principal executive office)(Zip code)
(336) 519-8080
(Registrant’s telephone number including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading SymbolName of each exchange on which registered
Common Stock, Par Value $0.01HBINew York Stock Exchange
Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes      No  
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes      No  
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filerAccelerated filer
Non-accelerated filerSmaller reporting companyEmerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes      No  
As of April 29, 2022, there were 348,775,722 shares of the registrant’s common stock outstanding.


TABLE OF CONTENTS
 
Page
Item 1.
Item 2.
Item 3.
Item 4.
PART II
Item 1.
Item 1A.
Item 2.
Item 3.
Item 4.
Item 5.
Item 6.



FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q contains information that may constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 (the “Exchange Act”). Forward-looking statements include all statements that do not relate solely to historical or current facts, and can generally be identified by the use of words such as “may,” “believe,” “will,” “expect,” “project,” “estimate,” “intend,” “anticipate,” “plan,” “continue” or similar expressions. However, the absence of these words or similar expressions does not mean that a statement is not forward-looking. All statements regarding our intent, belief and current expectations about our strategic direction, prospects and future results are forward-looking statements. Management believes that these forward-looking statements are reasonable as and when made. However, caution should be taken not to place undue reliance on any such forward-looking statements because such statements speak only as of the date when made. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. In addition, forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from our historical experience and our present expectations or projections. In particular,
statements with respect to trends associated with our business, our Full Potential plan and our future financial performance included in this Quarterly Report on Form 10-Q specifically appearing under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” include forward-looking statements.
More information on factors that could cause actual results or events to differ materially from those anticipated is included from time to time in our reports filed with the Securities and Exchange Commission (the “SEC”), including our Annual Report on Form 10-K for the year ended January 1, 2022, under the caption “Risk Factors,” and available on the “Investors” section of our corporate website, www.Hanes.com/investors. The contents of our corporate website are not incorporated by reference in this Quarterly Report on Form 10-Q.
1

PART I

Item 1.Financial Statements

HANESBRANDS INC.
Condensed Consolidated Statements of Income
(in thousands, except per share data)
(unaudited)

Quarters Ended
April 2,
2022
April 3,
2021
Net sales$1,576,156 $1,508,029 
Cost of sales991,978 905,348 
Gross profit584,178 602,681 
Selling, general and administrative expenses413,666 412,559 
Operating profit170,512 190,122 
Other expenses987 2,561 
Interest expense, net31,963 44,460 
Income from continuing operations before income tax expense137,562 143,101 
Income tax expense23,385 14,697 
Income from continuing operations114,177 128,404 
Income (loss) from discontinued operations, net of tax4,525 (391,666)
Net income (loss)$118,702 $(263,262)
Earnings (loss) per share - basic:
Continuing operations$0.33 $0.37 
Discontinued operations0.01 (1.12)
Net income (loss)$0.34 $(0.75)
Earnings (loss) per share - diluted:
Continuing operations$0.32 $0.37 
Discontinued operations0.01 (1.11)
Net income (loss)$0.34 $(0.75)

See accompanying notes to Condensed Consolidated Financial Statements.
2

HANESBRANDS INC.
Condensed Consolidated Statements of Comprehensive Income
(in thousands)
(unaudited)

Quarters Ended
April 2,
2022
April 3,
2021
Net income (loss)$118,702 $(263,262)
Other comprehensive income (loss):
Translation adjustments27,297 (25,201)
Unrealized gain on qualifying cash flow hedges, net of tax of $969 and $(5,176), respectively3,354 8,540 
Unrecognized income from pension and postretirement plans, net of tax of $(1,317) and $(2,049), respectively4,261 6,735 
Total other comprehensive income (loss)34,912 (9,926)
Comprehensive income (loss)$153,614 $(273,188)

See accompanying notes to Condensed Consolidated Financial Statements.
3

HANESBRANDS INC.
Condensed Consolidated Balance Sheets
(in thousands, except share and per share data)
(unaudited)

April 2,
2022
January 1,
2022
April 3,
2021
Assets
Cash and cash equivalents$369,210 $536,277 $530,403 
Trade accounts receivable, net898,420 894,151 807,738 
Inventories1,819,974 1,584,015 1,489,565 
Other current assets202,015 186,503 153,358 
Current assets held for sale7,959 327,157 303,045 
Total current assets3,297,578 3,528,103 3,284,109 
Property, net443,817 441,401 458,434 
Right-of-use assets350,174 363,854 416,136 
Trademarks and other identifiable intangibles, net1,235,276 1,220,170 1,269,932 
Goodwill1,138,667 1,133,095 1,150,138 
Deferred tax assets326,677 327,804 355,826 
Other noncurrent assets67,520 57,009 54,678 
Total assets$6,859,709 $7,071,436 $6,989,253 
Liabilities and Stockholders’ Equity
Accounts payable$1,204,196 $1,214,847 $976,887 
Accrued liabilities575,911 660,778 571,410 
Lease liabilities117,465 109,526 132,127 
Accounts Receivable Securitization Facility135,500   
Current portion of long-term debt25,000 25,000 34,375 
Current liabilities held for sale7,959 316,902 288,936 
Total current liabilities2,066,031 2,327,053 2,003,735 
Long-term debt3,325,042 3,326,091 3,649,631 
Lease liabilities - noncurrent258,663 281,852 315,382 
Pension and postretirement benefits242,690 248,518 333,460 
Other noncurrent liabilities187,867 185,429 202,564 
Total liabilities6,080,293 6,368,943 6,504,772 
Stockholders’ equity:
Preferred stock (50,000,000 authorized shares; $.01 par value)
Issued and outstanding — None   
Common stock (2,000,000,000 authorized shares; $.01 par value)
Issued and outstanding — 348,775,722, 349,903,253 and 349,090,472, respectively3,488 3,499 3,491 
Additional paid-in capital315,675 315,337 304,090 
Retained earnings976,944 935,260 753,785 
Accumulated other comprehensive loss(516,691)(551,603)(576,885)
Total stockholders’ equity779,416 702,493 484,481 
Total liabilities and stockholders’ equity$6,859,709 $7,071,436 $6,989,253 


See accompanying notes to Condensed Consolidated Financial Statements.
4

HANESBRANDS INC.
Condensed Consolidated Statements of Stockholders’ Equity
(in thousands, except per share data)
(unaudited)

 Common StockAdditional Paid-In CapitalRetained EarningsAccumulated Other Comprehensive LossTotal
 SharesAmount
Balances at January 1, 2022349,903 $3,499 $315,337 $935,260 $(551,603)$702,493 
Net income— — — 118,702 — 118,702 
Dividends ($0.15 per common share)
— — — (53,443)— (53,443)
Other comprehensive income— — — — 34,912 34,912 
Stock-based compensation— — 5,329 — — 5,329 
Net exercise of stock options, vesting of restricted stock units and other450 5 (3,564)— — (3,559)
Share repurchases(1,577)(16)(1,427)(23,575)— (25,018)
Balances at April 2, 2022348,776 $3,488 $315,675 $976,944 $(516,691)$779,416 

 Common StockAdditional Paid-In CapitalRetained EarningsAccumulated Other Comprehensive LossTotal
 SharesAmount
Balances at January 2, 2021348,802 $3,488 $307,883 $1,069,546 $(566,959)$813,958 
Net loss— — — (263,262)— (263,262)
Dividends ($0.15 per common share)
— — — (52,499)— (52,499)
Other comprehensive loss— — — — (9,926)(9,926)
Stock-based compensation— — (1,534)— — (1,534)
Net exercise of stock options, vesting of restricted stock units and other288 3 (2,259)— — (2,256)
Balances at April 3, 2021349,090 $3,491 $304,090 $753,785 $(576,885)$484,481 



See accompanying notes to Condensed Consolidated Financial Statements.
5

HANESBRANDS INC.
Condensed Consolidated Statements of Cash Flows
(in thousands)
(unaudited)

Quarters Ended
April 2, 2022(1)
April 3, 2021(1)
Operating activities:
Net income (loss)$118,702 $(263,262)
Adjustments to reconcile net income (loss) to net cash from operating activities:
Depreciation18,931 24,142 
Amortization of acquisition intangibles4,847 6,179 
Other amortization2,508 3,020 
Impairment of intangible assets and goodwill 163,047 
(Gain) loss on sale of business and classification of assets held for sale(6,715)226,352 
Amortization of debt issuance costs1,887 4,580 
Other6,940 (5,835)
Changes in assets and liabilities:
Accounts receivable(6,090)(63,955)
Inventories(247,567)(122,781)
Other assets(489)9,606 
Accounts payable(310)109,197 
Accrued pension and postretirement benefits24 (38,757)
Accrued liabilities and other(123,857)(34,587)
Net cash from operating activities(231,189)16,946 
Investing activities:
Capital expenditures(19,337)(17,804)
Proceeds from sales of assets19 2,406 
Other(10,272)1,794 
Net cash from investing activities(29,590)(13,604)
Financing activities:
Repayments on Term Loan Facilities(6,250)(300,000)
Borrowings on Accounts Receivable Securitization Facility290,000  
Repayments on Accounts Receivable Securitization Facility(154,500) 
Borrowings on Revolving Loan Facilities129,000  
Repayments on Revolving Loan Facilities(109,000) 
Borrowings on notes payable21,454 21,106 
Repayments on notes payable(21,713)(20,276)
Share repurchases(25,018) 
Cash dividends paid(52,297)(52,351)
Other(4,109)(2,902)
Net cash from financing activities67,567 (354,423)
Effect of changes in foreign exchange rates on cash1,793 (17,662)
Change in cash, cash equivalents and restricted cash(191,419)(368,743)
Cash, cash equivalents and restricted cash at beginning of year560,629 910,603 
Cash, cash equivalents and restricted cash at end of period369,210 541,860 
Less restricted cash at end of period 1,153 
Cash and cash equivalents at end of period$369,210 $540,707 
Balances included in the Condensed Consolidated Balance Sheets:
Cash and cash equivalents$369,210 $530,403 
Cash and cash equivalents included in current assets held for sale 10,304 
Cash and cash equivalents at end of period$369,210 $540,707 

(1)The cash flows related to discontinued operations have not been segregated and remain included in the major classes of assets and liabilities in the periods prior the sale of the European Innerwear business on March 5, 2022. Accordingly, the Condensed Consolidated Statements of Cash Flows include the results of continuing and discontinued operations.
Capital expenditures included in accounts payable at April 2, 2022 and January 1, 2022 were $27,960 and $24,164, respectively. For the quarters ended April 2, 2022 and April 3, 2021, right-of-use assets obtained in exchange for lease obligations were $16,035 and $4,755, respectively.
See accompanying notes to Condensed Consolidated Financial Statements.
6

HANESBRANDS INC.
Notes to Condensed Consolidated Financial Statements
(amounts in thousands, except per share data)
(unaudited)


(1)    Basis of Presentation
These statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) and, in accordance with those rules and regulations, do not include all information and footnote disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Management believes that the disclosures made are adequate for a fair statement of the results of operations, financial condition and cash flows of Hanesbrands Inc. and its consolidated subsidiaries (the “Company” or “Hanesbrands”). In the opinion of management, the condensed consolidated interim financial statements reflect all adjustments, which consist only of normal recurring adjustments, necessary to state fairly the results of operations, financial condition and cash flows for the interim periods presented herein. The preparation of condensed consolidated interim financial statements in conformity with GAAP requires management to make use of estimates and assumptions that affect the reported amounts and disclosures. Actual results may vary from these estimates.
These condensed consolidated interim financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended January 1, 2022. The year-end condensed balance sheet data was derived from audited financial statements, but does not include all disclosures required by GAAP. The results of operations for any interim period are not necessarily indicative of the results of operations to be expected for the full year. The results of operations for any interim period are not necessarily indicative of the results of operations to be expected for the full year.
In the first quarter of 2021, the Company announced that it reached the decision to exit its European Innerwear business as part of its strategy to streamline its portfolio under its Full Potential plan and determined that this business met held-for-sale and discontinued operations accounting criteria. Accordingly, the Company began to separately report the results of its European Innerwear business as discontinued operations in its Condensed Consolidated Statements of Income, and to present the related assets and liabilities as held for sale in the Condensed Consolidated Balance Sheets. On November 4, 2021, the Company announced that it reached an agreement to sell its European Innerwear business to an affiliate of Regent, L.P. and completed the sale on March 5, 2022. Unless otherwise noted, discussion within these notes to the condensed consolidated interim financial statements relates to continuing operations. See Note “Assets and Liabilities Held for Sale” for additional information.
In addition, in the fourth quarter of 2021, the Company reached the decision to divest its U.S. Sheer Hosiery business, including the L’eggs brand, as part of its strategy to streamline its portfolio under its Full Potential plan and determined that this business met held-for-sale accounting criteria. The related assets and liabilities are presented as held for sale in the Condensed Consolidated Balance Sheets at April 2, 2022 and January 1, 2022. The operations of the U.S. Sheer Hosiery business are reported in “Other” for all periods presented in Note “Business Segment Information”. The Company is currently exploring potential purchasers for this business and expects to complete the sale of this business during 2022. See Note “Assets and Liabilities Held for Sale” for additional information.
(2)    Recent Accounting Pronouncements
Reference Rate Reform
In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” In January 2021, the FASB clarified the scope of that guidance with the issuance of ASU 2021-01, “Reference Rate Reform: Scope.” The new accounting rules provide optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform. The new accounting rules can be adopted any time before the fourth quarter of 2022. The Company is currently in the process of evaluating the impact of adoption of the new rules on the Company’s financial condition, results of operations, cash flows and disclosures and does not currently intend to early adopt the new rules.
Business Combinations
In October 2021, the FASB issued ASU 2021-08, “Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers.” The new accounting rules require entities to apply Topic 606 to
7

HANESBRANDS INC.
Notes to Condensed Consolidated Financial Statements — (Continued)
(amounts in thousands, except per share data)
(unaudited)
recognize and measure contract assets and contract liabilities in a business combination. The new accounting rules will be effective for the Company in the first quarter of 2023, including interim periods. Early adoption is permitted. The adoption impact of the new accounting rules will depend on the magnitude of future acquisitions.
Derivatives and Hedging
In March 2022, the FASB issued ASU 2022-01, “Derivatives and Hedging (Topic 815): Fair Value Hedging - Portfolio Layer Method.” The new accounting rules allow entities to expand the use of the portfolio layer method to all financial assets and designate multiple hedged layers within a single closed portfolio. The new accounting rules also clarify guidance related to hedge basis adjustments and the related disclosures for these adjustments. The new accounting rules will be effective for the Company in the first quarter of 2023, including interim periods. Early adoption is permitted. The Company is currently in the process of evaluating the impact of adoption of the new rules on the Company’s financial condition, results of operations, cash flows and disclosures.
(3)    Assets and Liabilities Held for Sale
Assets and liabilities classified as held for sale in the Condensed Consolidated Balance Sheets as of April 2, 2022, January 1, 2022 and April 3, 2021 consist of the following:
April 2,
2022
January 1,
2022
April 3,
2021
U.S. Sheer Hosiery business - continuing operations$7,959 $5,426 $ 
European Innerwear business - discontinued operations 321,731 303,045 
Total current assets held for sale$7,959 $327,157 $303,045 
U.S. Sheer Hosiery business - continuing operations$7,959 $5,426 $ 
European Innerwear business - discontinued operations 311,476 288,936 
Total current liabilities held for sale$7,959 $316,902 $288,936 
U.S. Sheer Hosiery Business - Continuing Operations
In the fourth quarter of 2021, the Company reached the decision to divest its U.S. Sheer Hosiery business, including the L’eggs brand, as part of its strategy to streamline its portfolio under its Full Potential plan and determined that this business met held-for-sale accounting criteria. The related assets and liabilities are presented as held for sale in the Condensed Consolidated Balance Sheets at April 2, 2022 and January 1, 2022. The Company recorded a non-cash charge of $38,364 in the fourth quarter of 2021, to record a valuation allowance against the net assets held for sale to write down the carrying value of the disposal group to the estimated fair value less costs of disposal. In the quarter ended April 2, 2022, the Company recorded a non-cash gain of $6,528 to adjust the valuation allowance resulting from a decrease in carrying value due to changes in working capital. The operations of the U.S. Sheer Hosiery business are reported in “Other” for all periods presented in Note “Business Segment Information”. The Company is currently exploring potential purchasers for this business and expects to complete the sale of this business during 2022.
8

HANESBRANDS INC.
Notes to Condensed Consolidated Financial Statements — (Continued)
(amounts in thousands, except per share data)
(unaudited)
European Innerwear Business - Discontinued Operations
In the first quarter of 2021, the Company announced that it reached the decision to exit its European Innerwear business as part of its strategy to streamline its portfolio under its Full Potential plan and determined that this business met held-for-sale and discontinued operations accounting criteria. Accordingly, the Company began to separately report the results of its European Innerwear business as discontinued operations in its Condensed Consolidated Statements of Income, and to present the related assets and liabilities as held for sale in the Condensed Consolidated Balance Sheets. On November 4, 2021, the Company announced that it had reached an agreement to sell its European Innerwear business to an affiliate of Regent, L.P. and completed the sale on March 5, 2022. Under the agreement, the purchaser received all the assets and operating liabilities of the European Innerwear business. The operations of the European Innerwear business were previously reported primarily in the International segment.
Upon meeting the criteria for held-for-sale classification in the first quarter of 2021which qualified as a triggering event, the Company performed a full impairment analysis of the disposal group's indefinite-lived intangible assets and goodwill. As a result of the strategic decision to exit the European Innerwear business, forecasts were revised to include updated market conditions and the removal of strategic operating decisions that would no longer occur under the Company's ownership. The revised forecasts indicated impairment of certain indefinite-lived trademarks and license agreements as well as the full goodwill balance attributable to the European Innerwear business. As a result of this impairment analysis, a non-cash charge of $155,745 was recorded as "Impairment of intangible assets and goodwill" in the summarized discontinued operations financial information for the quarter ended April 3, 2021. In addition, the Company recorded a valuation allowance against the net assets held for sale to write down the carrying value of the disposal group to the estimated fair value less costs of disposal, resulting in a non-cash charge of $226,352 for the quarter ended April 3, 2021, as "(Gain) loss on sale of business and classification of assets held for sale" in the summarized discontinued operations financial information. In the quarter ended April 2, 2022, the Company recorded the final gain on the sale of the European Innerwear business of $187 primarily resulting from changes in working capital balances and foreign exchange rates.
Additionally, the Company recorded an impairment charge of $7,302 in continuing operations on an indefinite-lived trademark for the quarter ended April 3, 2021 which is reflected in the “Selling, general and administrative expenses” line in the Condensed Consolidated Statements of Income. This charge related to the full impairment of an indefinite-lived trademark related to a specific brand within the European Innerwear business that was excluded from the disposal group as it was not marketed for sale and that the Company intends to exit.
The Company has continued certain sales from its supply chain to the European Innerwear business on a transitional basis after the sale of the business. Under the terms of the Manufacturing and Supply Agreement, the Company will provide these services for periods up to 34 months from the closing date of the transaction. Additionally, the Company entered into a Transitional Services Agreement pursuant to which the Company will provide transitional services including information technology, human resources, facilities management, and limited finance and accounting services for periods up to 12 months from the closing date of the transaction. The sales and the related profit are included in continuing operations in the Condensed Consolidated Statements of Income and in “Other” in Note “Business Segment Information” in all periods presented and have not been eliminated as intercompany transactions in consolidation. The related receivables from the European Innerwear business are included in “Trade accounts receivable, net” in the Condensed Consolidated Balance Sheets for all periods presented.
9

HANESBRANDS INC.
Notes to Condensed Consolidated Financial Statements — (Continued)
(amounts in thousands, except per share data)
(unaudited)
The operating results of the discontinued operations only reflect revenues and expenses that are directly attributable to the European Innerwear business that are eliminated from continuing operations. Discontinued operations does not include any allocation of corporate overhead expense or interest expense. The key components from discontinued operations related to the European Innerwear business are as follows:
Quarters Ended
April 2,
2022
April 3,
2021
Net sales$101,314 $135,845 
Cost of sales60,415 75,523 
Gross profit40,899 60,322 
Selling, general and administrative expenses54,689 83,392 
Impairment of intangible assets and goodwill 155,745 
(Gain) loss on sale of business and classification of assets held for sale(187)226,352 
Operating loss(13,603)(405,167)
Other expenses283 334 
Interest expense, net10 90 
Loss from discontinued operations before income tax expense(13,896)(405,591)
Income tax benefit(18,421)(13,925)
Net income (loss) from discontinued operations, net of tax$4,525 $(391,666)

10

HANESBRANDS INC.
Notes to Condensed Consolidated Financial Statements — (Continued)
(amounts in thousands, except per share data)
(unaudited)
Assets and liabilities of discontinued operations classified as held for sale in the Condensed Consolidated Balance Sheets as of April 2, 2022, January 1, 2022 and April 3, 2021 consist of the following:
April 2,
2022
January 1,
2022
April 3,
2021
Cash and cash equivalents$ $24,352 $10,304 
Trade accounts receivable, net 87,353 80,458 
Inventories 141,653 106,192 
Other current assets 21,926 11,190 
Property, net 62,659 61,763 
Right-of-use assets 32,603 34,779 
Trademarks and other identifiable intangibles, net 205,204 208,601 
Deferred tax assets 4,174 8,505 
Other noncurrent assets 4,127 4,860 
Allowance to adjust assets to estimated fair value, less costs of disposal (262,320)(223,607)
Total assets of discontinued operations$ $321,731 $303,045 
Accounts payable$ $84,327 $62,199 
Accrued liabilities 122,620 120,475 
Lease liabilities 6,562 9,159 
Notes payable 329 1,574 
Lease liabilities - noncurrent 27,426 27,038 
Pension and postretirement benefits 38,325 44,428 
Other noncurrent liabilities 31,887 24,063 
Total liabilities of discontinued operations$ $311,476 $288,936 
The cash flows related to discontinued operations have not been segregated and are included in the Condensed Consolidated Statements of Cash Flows. The following table presents cash flow and non-cash information related to discontinued operations:
Quarters Ended
April 2,
2022
April 3,
2021
Depreciation$ $2,608 
Amortization$ $1,460 
Capital expenditures$715 $3,335 
Impairment of intangible assets and goodwill$ $155,745 
(Gain) loss on sale of business and classification of assets held for sale$(187)$226,352 
Capital expenditures included in accounts payable at end of period$ $52 
Right-of-use assets obtained in exchange for lease obligations$461 $1,495 
11

HANESBRANDS INC.
Notes to Condensed Consolidated Financial Statements — (Continued)
(amounts in thousands, except per share data)
(unaudited)
(4)    Revenue Recognition
The following table presents the Company’s revenues disaggregated by the customer’s method of purchase:

Quarters Ended
April 2,
2022
April 3,
2021
Third-party brick-and-mortar wholesale$1,126,266 $1,024,739 
Consumer-directed449,890 483,290 
Total net sales$1,576,156 $1,508,029 
Revenue Sources
Third-Party Brick-and-Mortar Wholesale Revenue
Third-party brick-and-mortar wholesale revenue is primarily generated by sales of the Company’s products to retailers to support their brick-and-mortar operations. Third-party brick-and-mortar wholesale revenue also includes royalty revenue from licensing agreements. The Company earns royalties through license agreements with manufacturers of other consumer products that incorporate certain of the Company’s brands. The Company accrues revenue earned under these contracts based upon reported sales from the licensees.
Consumer-Directed Revenue
Consumer-directed revenue is primarily generated through sales driven directly by the consumer through company-operated stores and e-commerce platforms, which include both owned sites and the sites of the Company’s retail customers.
(5)    Stockholders’ Equity
Basic earnings per share (“EPS”) was computed by dividing net income (loss) by the number of weighted average shares of common stock outstanding during the period. Diluted EPS was calculated to give effect to all potentially issuable dilutive shares of common stock using the treasury stock method.
The reconciliation of basic to diluted weighted average shares outstanding is as follows:
Quarters Ended
April 2,
2022
April 3,
2021
Basic weighted average shares outstanding350,251 351,003 
Effect of potentially dilutive securities:
Stock options7 9 
Restricted stock units1,190 671 
Employee stock purchase plan and other5 3 
Diluted weighted average shares outstanding351,453 351,686 
The following securities were excluded from the diluted earnings per share calculation because their effect would be anti-dilutive:
Quarters Ended
April 2,
2022
April 3,
2021
Stock options167 167 
Restricted stock units647 592 
On April 26, 2022, the Company’s Board of Directors declared a regular quarterly cash dividend of $0.15 per share of the Company’s outstanding common stock to be paid on May 31, 2022 to stockholders of record at the close of business on May 10, 2022.
12

HANESBRANDS INC.
Notes to Condensed Consolidated Financial Statements — (Continued)
(amounts in thousands, except per share data)
(unaudited)
On February 2, 2022, the Company’s Board of Directors approved a new share repurchase program for up to $600,000 of shares to be repurchased in open market transactions or privately negotiated transactions, subject to market conditions, legal requirements and other factors. Additionally, management has been granted authority to establish a trading plan under Rule 10b5-1 of the Exchange Act in connection with share repurchases, which will allow the Company to repurchase shares in the open market during periods in which the stock trading window is otherwise closed for the Company and certain of the Company’s officers and employees pursuant to the Company’s insider trading policy. The new program replaced the Company’s previous share repurchase program for up to 40,000 shares that was originally approved on February 6, 2020. For the quarter ended April 2, 2022, the Company entered into transactions to repurchase 1,577 shares at a weighted average repurchase price of $15.84 per share under the new program. The shares were repurchased at a total cost of $25,018 including broker’s commissions of $31. The Company did not repurchase any shares under the previous share repurchase program during the quarter ended April 2, 2022 or April 3, 2021. At April 2, 2022, the remaining repurchase authorization under the current share repurchase program totaled $575,013.
(6)    Inventories
Inventories consisted of the following: 
April 2,
2022
January 1,
2022
April 3,
2021
Raw materials$84,734 $68,683 $74,123 
Work in process121,095 110,246 99,619 
Finished goods1,614,145 1,405,086 1,315,823 
$1,819,974 $1,584,015 $1,489,565 
(7)    Debt
Debt consisted of the following: 
Interest Rate as of April 2,
2022
Principal AmountMaturity Date
 April 2,
2022
January 1,
2022
Senior Secured Credit Facility:
Revolving Loan Facility1.69%$20,000 $ November 2026
Term Loan A1.75%993,750 1,000,000 November 2026
4.875% Senior Notes4.88%900,000 900,000 May 2026
4.625% Senior Notes4.63%900,000 900,000 May 2024
3.5% Senior Notes3.50%552,425 568,634 June 2024
Accounts Receivable Securitization Facility1.25%135,500  June 2022
3,501,675 3,368,634 
Less long-term debt issuance costs16,133 17,543 
Less current maturities160,500 25,000 
$3,325,042 $3,326,091 
As of April 2, 2022, the Company had $975,824 of borrowing availability under the $1,000,000 Revolving Loan Facility after taking into account $20,000 of USD revolver loans and $4,176 of standby and trade letters of credit issued and outstanding under this facility.
Borrowings under the Company’s accounts receivable securitization facility (the “ARS Facility”) are permitted only to the extent that the face of the receivables in the collateral pool, net of applicable concentrations, reserves and other deductions, exceeds the outstanding loans and also subject to a quarterly fluctuating facility limit, which is not to exceed $175,000. The Company’s maximum borrowing capacity as per the fluctuating limit under the ARS Facility was $150,000 as of April 2, 2022. The Company had $14,500 of borrowing availability under the ARS Facility at April 2, 2022.
The Company had $56,056 of borrowing availability under other international credit facilities after taking into account outstanding borrowings and letters of credit outstanding under the applicable facilities at April 2, 2022.
13

HANESBRANDS INC.
Notes to Condensed Consolidated Financial Statements — (Continued)
(amounts in thousands, except per share data)
(unaudited)
As of April 2, 2022, the Company was in compliance with all financial covenants under its credit facilities and other outstanding indebtedness. Under the terms of its Senior Secured Credit Facility, among other financial and non-financial covenants, the Company is required to maintain a minimum interest coverage ratio and a maximum leverage ratio, each of which is defined in the Senior Secured Credit Facility. The method of calculating all the components used in the covenants is included in the Senior Secured Credit Facility.
(8)    Income Taxes
The Company’s effective income tax rate was 17.0% and 10.3% for the quarters ended April 2, 2022 and April 3, 2021, respectively. The higher effective tax rate for the quarter April 2, 2022 was primarily due to a non-recurring discrete tax benefit for the release of reserves for unrecognized tax benefits totaling $7,034, partially offset by a discrete charge for changes in valuation allowances of $3,672 during the quarter ended April 3, 2021.
(9)    Accumulated Other Comprehensive Loss
The components of accumulated other comprehensive loss (“AOCI”) are as follows:
Cumulative Translation Adjustment(1)
Cash Flow HedgesDefined Benefit PlansIncome TaxesAccumulated Other Comprehensive Loss
Balance at January 1, 2022$(134,001)$5,244 $(569,161)$146,315 $(551,603)
Amounts reclassified from accumulated other comprehensive loss
(13,473)9,789 5,618 (2,778)(844)
Current-period other comprehensive income (loss) activity
40,770 (7,404)(40)2,430 35,756 
Total other comprehensive income (loss)27,297 2,385 5,578 (348)34,912 
Balance at April 2, 2022$(106,704)$7,629 $(563,583)$145,967 $(516,691)
Cumulative Translation Adjustment(1)
Cash Flow HedgesDefined Benefit PlansIncome TaxesAccumulated Other Comprehensive Loss
Balance at January 2, 2021$(52,820)$(26,538)$(668,730)$181,129 $(566,959)
Amounts reclassified from accumulated other comprehensive loss
 5,242 7,085 (3,004)9,323 
Current-period other comprehensive income (loss) activity
(25,201)8,474 1,699 (4,221)(19,249)
Total other comprehensive income (loss)(25,201)13,716 8,784 (7,225)(9,926)
Balance at April 3, 2021$(78,021)$(12,822)$(659,946)$173,904 $(576,885)
(1)Cumulative Translation Adjustment includes translation adjustments and net investment hedges. See Note “Financial Instruments and Risk Management” for additional disclosures about net investment hedges.
14

HANESBRANDS INC.
Notes to Condensed Consolidated Financial Statements — (Continued)
(amounts in thousands, except per share data)
(unaudited)
The Company had the following reclassifications out of AOCI:
Component of AOCI Location of Reclassification into IncomeAmount of Reclassification from AOCI
Quarters Ended
April 2,
2022
April 3,
2021
Write-off of cumulative translation associated with sale of businessIncome (loss) from discontinued operations, net of tax$13,473 $ 
Gain (loss) on forward foreign exchange contracts designated as cash flow hedgesCost of sales$1,612 $(4,377)
Income tax(508)1,208 
Income (loss) from discontinued operations, net of tax(232)(244)
Net of tax872 (3,413)
Gain (loss) on cross-currency swap contracts designated as cash flow hedgesSelling, general and administrative expenses(9,733)(557)
Interest expense, net(1,361) 
Income tax1,886 89 
Net of tax(9,208)(468)
Amortization of deferred actuarial loss and prior service costOther expenses(5,203)(7,707)
Income tax1,370 1,746 
Income (loss) from discontinued operations, net of tax 519 
Pension activity associated with sale of businessIncome (loss) from discontinued operations, net of tax(460) 
Net of tax(4,293)(5,442)
Total reclassifications$844 $(9,323)
(10)    Financial Instruments and Risk Management
The Company uses forward foreign exchange contracts and cross-currency swap contracts to manage its exposures to movements in foreign exchange rates primarily related to the Australian dollar, Euro, Mexican peso and Canadian dollar. The Company also uses a combination of cross-currency swap contracts and long-term debt to manage its exposure to foreign currency risk associated with the Company’s net investment in its European subsidiaries.
Hedge TypeApril 2,
2022
January 2,
2021
U.S. dollar equivalent notional amount of derivative instruments:
Forward foreign exchange contractsCash Flow and
Mark to Market
$326,800 $308,071 
Cross-currency swap contractsCash Flow$352,920 $352,920 
Cross-currency swap contractsNet Investment$335,940 $335,940 
15

HANESBRANDS INC.
Notes to Condensed Consolidated Financial Statements — (Continued)
(amounts in thousands, except per share data)
(unaudited)
Fair Values of Derivative Instruments
The fair values of derivative instruments related to forward foreign exchange contracts and cross-currency swap contracts recognized in the Condensed Consolidated Balance Sheets of the Company were as follows:
Balance Sheet LocationFair Value
April 2,
2022
January 1,
2022
Derivatives designated as hedging instruments:
Forward foreign exchange contractsOther current assets$1,037 $2,898 
Cross-currency swap contractsOther current assets