In its first earnings report since inking a deal to sell Champion, HanesBrands (asi/59528) announced what it characterized as “solid second-quarter results” and pointed to actions it’s taken to strengthen and simplify the business.

The Winston-Salem, NC-based publicly traded global manufacturer of apparel basics, whose goods sell extensively in the promotional products market, reported that its net sales were $995 million from continuing operations in Q2, a decrease of approximately 4% compared to the prior year. On an organic constant currency basis, year-over-year net sales were down approximately 1% – or $11 million. The company noted that its numbers were helped by U.S. innerwear sales.

“We delivered solid second-quarter results in a challenging consumer and apparel market, including better-than-expected U.S. innerwear performance and margin expansion,” said Steve Bratspies, CEO. “We’ve taken several strategic actions that have fundamentally strengthened and simplified our business, better positioning the company for consistent revenue growth, higher profit margins and strong cash generation.”

He added: “We believe our earnings growth potential and continued debt pay down positions us to unlock significant shareholder value.”

One of the biggest moves HanesBrands made in Q2 was entering into an agreement with Authentic Brands Group (ABG) to sell its Champion business. The company also completed its exit from U.S. outlet stores in July. Beginning in the second quarter, both have been reclassified to discontinued operations. These strategic actions, HanesBrands said, will help put the company into “a strong competitive position” going forward, with “multiple levers to unlock shareholder value over the next several years.”

HanesBrands said it’s on track to complete the sale of global Champion business in the second half of 2024 and continues its expectation to receive net proceeds of approximately $900 million. However, HanesBrands expects to continue operating its Champion Japan business as a licensee until sometime after January 2025 before it’s transitioned to ABG, per the terms of the definitive agreement.

The company said it expects to pay down around $1 billion of debt in the second half of 2024, using net proceeds from the Champion sale as well as internal cash generation.

Though HanesBrands is still reporting losses in Q2, the sales decline is slowing. In Q1, the company reported a sales drop of nearly 17% year over year to about $1.156 billion. And for full-year 2023, HanesBrands had a year-over-year sales decrease of nearly 10%, with a recorded $17.7 million loss.