GILDAN SUSTAINS $24.6M LOSS
Byline: Evan Clark
NEW YORK — Despite an uptick in demand, Canadian T-shirt manufacturer Gildan Activewear Inc. posted steep fourth-quarter losses, though, with mid-single-digit declines, profits for the year fared better.
Net losses for the quarter ended Sept. 30 totaled $24.6 million, or 87 cents a share, compared with income of $10.7 million, or 38 cents, in 2000. Year-ago results per share were restated to account for a 2-to-1 stock split in February.
Results included special charges and other adjustments aggregating to $28.8 million after tax, or 99 cents a diluted share. Excluding the special items, earnings in the most recent period would have been $4.3 million, or 15 cents a share.
Sales deflated 6.8 percent, to $73 million from $78.3 million a year ago. Dollar figures were converted from Canadian dollars at current exchange.
Citing A.C. Nielsen statistics, the firm said industrywide demand for T-shirts grew 5.7 percent during the quarter, on a 32.3 percent surge in unit shipments in September, reflecting renewed patriotism in the U.S. The demand depleted inventories in the distributor channel and reduced manufacturers’ inventories, setting the stage for greater price stability in fiscal 2002, the company noted in a statement.
Total units shipped by Gildan to distributors during the quarter were up 4 percent, but the higher unit sales were more than offset by reduced gross margins and higher expenses.
For the year, earnings plummeted to $517,000, or 2 cents a share, from $34.6 million, or $1.25. Excluding special items, earnings totaled $31.9 million, or $1.09 a diluted share, down 7.9 percent from a year ago on a net basis.
Sales for the 12 months advanced 9.9 percent, to $320 million from $291 million a year ago.
In light of widespread uncertainty in the marketplace, the Montreal-based maker pulled back its profit estimates for 2002, to $1.80 to $2 a share from the $2.15 to $2.25 previously expected.