Carter’s net sales decline 4.9% in Q1 FY24. Credit: JHVEPhoto via Shutterstock.com.

North American apparel company Carter’s has announced that its net income for the first quarter (Q1) of the fiscal year 2024 (FY24) increased $2m to $38m, compared to $36m in Q1 FY23.  

The apparel retailer’s earnings per diluted share (EPS) also rose to $1.04, up from $0.95 in Q1 FY23.  

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Carter’s adjusted net income, a non-GAAP measure, saw a slight increase from $36.9m to $38.0m. 

For the quarter ending 30 March 2024, the retailer experienced a 4.9% decline in net sales, falling to $661.5m from $695.9m in Q1 FY23.  

The company attributed this decrease to the impact of inflation on families with young children and the late arrival of spring weather, which dampened demand.  

The net sales across its US retail, US wholesale and international segments fell by 5.0%, 5.7% and 2.7%, respectively over the quarter, with US retail comparable net sales dropping by 6.8%. 

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Carter’s operating income saw a slight decrease of 2.3%, landing at $55.0m for Q1 FY24, compared to $56.4m in the previous year.  

The operating margin, however, improved to 8.3% from 8.1%. 

Looking ahead to the full fiscal year 2024, Carter’s anticipates net sales between $2.95bn and $3.0bn, with low to mid-single-digit growth in adjusted diluted EPS. 

Carter’s chairman and CEO Michael Casey said: “We exceeded our sales and earnings objectives in the first quarter. 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.” 

Casey added: “The earlier Easter and slow start to Spring shopping will impact our sales in the second quarter. We have reflected in our forecasts the performance and growth we believe is possible in the balance of the year.”