Montreal-based apparel maker Gildan Activewear has announced net sales of $703 million for the first quarter ended April 2, 2023, representing a 9 percent decrease year-over-year. The company said that the sales drop reflected anticipated headwinds connected with the current demand environment and strong comparative periods in the first half of 2022. International sales in the quarter were down 17 percent versus the prior year, but the company is continuing to maintain a positive outlook regarding the recovery of international markets for the full year.
The gross margin for the first quarter was down year-over-year by 430 basis points to 26.7 percent and adjusted gross margin of 26.2 percent was down 470 basis points, mainly as a result of the flow-through impact on cost of sales of peak fiber costs and higher manufacturing input costs.
These factors were both anticipated, the company said, and were partly offset by higher net selling prices. Net earnings of $97.6 million in Q1 compare to net earnings of $146.4 million in the first quarter of 2022. The company has reconfirmed its prior outlook of revenue growth for the full year to be in the low single digit range, and of adjusted diluted EPS in line with 2022, assuming no meaningful deterioration from current market conditions, including the pricing and inflationary environment.
