“We’re confident that we can leverage our deep and extensive distribution network in North America and internationally to grow the brand,” said Rhodri Harries, Gildan’s executive vice president and chief financial officer, on a conference call with analysts covering the company’s financial results.
Harries said Gildan, which was the winning bidder for some of American Apparel’s assets at a bankruptcy auction last month, has been integrating the brand and working on supply chain tweaks to “support made in the USA product as we move through this transitional period.”
Gildan expects it to have a “neutral” impact on earnings for the year.
Glenn Chamandy, president and chief executive officer, said American Apparel should be fully integrated into Gildan’s distribution sometime in March.
“It’s a premier brand in our segment,” Chamandy said. “It can really help us focus on capturing a bigger share of the fashion basics and it’s going to be our highest price point in the product line.”
He noted that there are a number of opportunities to grow American Apparel internationally, adding, “We have huge interest from all of our international customers to carry the brand.”
Outside of American Apparel, Gildan said its focus in 2017 will be growing its core business, including underwear, socks and activewear.
Gildan’s 2016 total sales inched up to $2.58 billion from $2.56 billion and it also eked out a rise in net earnings, up to $346.6 million from $346.1 million in 2015.
Diluted earnings per share came in at $1.47, up from $1.42.
Looking ahead, the company expects 2017 earnings per share to hit between $1.60 and $1.70, or a median growth of 9 percent, on the back of “high-single-digit” net sales growth in printwear and branded apparel.