The financial struggles are continuing for HanesBrands (asi/59528).

The North Carolina-headquartered global manufacturer of apparel basics, whose products sell extensively in the promotional products market, reported that sales declined nearly 17% year over year in the first quarter of 2024 to about $1.156 billion.

A 26% annual basis drop in sales of Hanes’ Champion brand contributed to the overall revenue retreat. The topline trouble across Hanes’ business segments was a key catalyst behind the bottom-line loss of $39.1 million, or -$0.11 per share, that the firm reported in Q1 2024. The loss was worse than in the prior year’s first quarter, when HanesBrands sustained a loss of about $34.4 million, or -$0.10 per share. A bright spot was that gross profit rose 2.5% to about $461 million.

Authentic Brands To Buy Champion From Hanes for $1 Billion https://t.co/irBQRSfli7

— Chris Ruvo (@ChrisR_ASI) April 3, 2024

HanesBrands, a publicly traded company, reportedly began shopping Champion last year. In April, sources revealed that Authentic Brands Group had agreed to buy Champion for $1 billion.

HanesBrands has not announced the finalization of the deal. The sale was expected to close in late May or early June. Headquartered in New York City and private equity-owned, Authentic Brands Group’s portfolio includes Aeropostale, Bandolino, Billabong, Brooks Brothers, Eddie Bauer, IZOD and Van Heusen.

HanesBrands noted in its Q1 financial report that it expects to incur “pretax charges for actions related to the ‘Full Potential’ transformation plan and the global Champion performance plan of approximately $70 million.”

In Q1, sales in HanesBrands activewear segment, which includes Champion, fell 31% on an annual basis. Soft consumer demand and caution in restocking from retailers contributed to the drop, though the company said the retreat was primarily due to: a shift of the Champion kids’ business to a license model beginning in 2024; an unseasonably strong collegiate sales performance in first-quarter 2023 that made the year-to-year comparative tough to match; and, accelerated orders into first-quarter 2023 ahead of the Hanes’ SAP implementation.

Other factors in HanesBrands’ overall sales decline included the divestiture of its U.S. Sheer Hosiery business, executives said.

For full-year 2023, HanesBrands had a year-over-year sales decrease of nearly 10% and recorded a $17.7 million loss.

Despite all that, executives believe the company is building toward better days.

“We have created,” said CEO Steve Bratspies, “a multi-year flywheel designed to accelerate earnings, deleverage faster and invest in growth initiatives, which we believe will drive strong shareholder returns over the next several years.”