Driven by Printwear and Branded Apparel sales, consolidated net sales at clothing retailer Gildan Activewear soared 15.9 per cent year over year in the first fiscal quarter ended April 5, 2015.
Consolidated net sales in the first quarter of fiscal 2016 amounted to $636.2 million, up 15.9 per cent from $548.8 million in the corresponding quarter of the prior fiscal.
“This reflects a sales increase of approximately 14 per cent in Printwear sales and around 20 per cent in Branded Apparel, both up from a year ago periods,” a Gildan press release said.
“Consolidated net sales in the quarter were in line with the Company’s guidance of net sales in excess of $630 million,” the apparel retailer added.
Gildan reported net earnings of $56.0 million or $0.23 per share on a diluted basis for the three months ended April 5, 2015 as against $79.2 million or $0.32 per share in the same quarter of last fiscal.
Before reflecting minor restructuring and acquisition-related costs, Gildan reported adjusted net earnings of $57.5 million or $0.24 per share for the period under review.
For the same period of the previous fiscal, it recorded adjusted net earnings of $79.2 million or $0.32 per share.
Gildan also added that adjusted EPS for the quarter were as projected in its guidance issued on February 4, 2015 of adjusted EPS of $0.23–0.24 on a post-split basis.
Gildan informed that during the three-month period ended March 31, 2015; Gildan brand was No. 3 in men’s underwear and had a market share of 7.3 per cent, according to the NPD Group’s Retail Tracking Service.
The retailer attributed low operating margins to consumption of high-cost opening inventories, which included the impact of transitional manufacturing costs and higher cotton costs.
For the 12 months ending January 3, 2016, Gildan narrowed its guidance range for adjusted diluted EPS to $1.50–1.55 compared with its initial guidance of $1.50–1.57.
This according to Gildan, reflects the impact of the further devaluation of international currencies relative to the US dollar.
The Company continues to project consolidated net sales slightly in excess of $2.65 billion. Operating margins in Printwear are also projected to be negatively impacted by further weakening of global currencies.
Branded Apparel segment sales growth is projected to continue to be strong in the second quarter of calendar 2015 and operating margins in Branded Apparel are projected to improve.
The Company expects to resume its trajectory of EPS growth in the second half of the calendar year, when it begins to benefit from manufacturing cost savings from its yarn-spinning investments.
