Berkshire Hathaway’s revenues generated by its apparel and footwear businesses, including Fruit of the Loom, H.H. Brown Shoe Group, Garan, and Brooks Sports, had modest growth in 2017.
Sales increased 1.2 percent in 2017 compared to 2016, to $4.2 billion.
According to Berkshire Hathaway’s 10K filing, pre-tax earnings from apparel and footwear businesses were up 5 percent in 2017, primarily due to increased earnings from the footwear businesses.
Berkshire Hathaway’s footwear business includes Brooks Sports and H.H. Brown Shoe Group, which includes Justin, Tony Lama, Nocona, Chippewa, BØRN, B•Ø•C, Carolina, Söfft, Double-H Boots, Nursemates and Comfortiva. Apparel businesses largely consists of Fruit of the Loom, which includes Fruit of the Loom, Jerzees, Vanity Fair, Russell Athletic and Spalding. Berkshire Hathaway also owns Garan, the children’s apparel brand.
In 2016, apparel and footwear revenues in 2016 declined $81 million (1.9 percent) compared to 2015, reflecting lower footwear sales and the impact of a divestiture by Fruit of the Loom in 2015. Earnings of its apparel businesses increased 22 percent in 2016, primarily attributable to lower restructuring costs and a loss in 2015 from the disposition of a Fruit of the Loom operation, partly offset by lower earnings from its footwear businesses. In 2015, Fruit of the Loom exited an unprofitable intimate apparel business in Europe.
Overall sales in its Consumer Products segment rose 10.0 percent in 2017 to $12.1 billion. Besides the footwear and apparel business, the Consumer Products segments includes Forest River (leisure vehicles), Duracell (batteries), Larson Juhl (custom framing products) and Richline (jewelry).
While employee levels for most of Berkshire’s brands were relatively stable, Russell Athletics had a major decline of 1,020 employees as compared to 1,551 in 2016.
In 2017, Fruit of the Loom’s Russell Athletic brand ceased making athletic uniforms. The move marked the end of a long history in a product line that in the last decade had seen skyrocketing marketing costs.
© 2018 David Mazor
Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.