Canadian activewear group Gildan reported a 24.5 percent increase in Q3 operating income to $192.9 million versus $155.0 million for the period ended Sep. 29. Adjusted Ebitda rose by 25 percent to $236.1 million year-over-year as net income improved by 3.2 percent year-over-year to $131.5 million.
Group total Q3 net sales increased by 2.4 percent to $891.1 million from $869.9 million as gross margin expanded by 370 basis points year-over-year to 31.2 percent. Activewear sales, bolstered by higher shipments across North America and inventory replenishments by distributors, rose by 5.9 percent to $788.3 million from $744.4 million.
Gildan’s sales outside the US went up this summer SGI has reported.
Non-North American sales improved by 20 percent year-over-year to $64.1 million, fueled by positive point-of-sales in Europe and distributor replenishment. The company said it is now better positioned to service the market as it continues ramping up its Bangladesh facility, which is projected to be at 75 percent capacity by year-end and will support its ring-spun products. Gildan is also continuing to optimize its manufacturing operations in Central America to support growth in its fleece segment, which started the season soft due to warmer weather conditions.
“…But we still feel very good about the category and really good about our strong position in fleece,” commented Chuck J. Ward, Gildan’s president of sales, marketing, and distribution. He also told analysts that early market reception to the brand’s soft cotton technology in apparel has been “well received.”
Fleece currently accounts for approximately 17 percent of Gildan’s unit volume, but the company sees it as a growth category whose sales should increase by high-single digits over the next three years.
