Delta Galil has signed a long-term global licensing agreement with Polo Ralph Lauren for women’s intimates and sleepwear as the Tel Aviv, Israel-based apparel and innerwear manufacturer continues to strengthen its position in the global innerwear market.
“This partnership represents a significant addition to our licensing portfolio and we’re thrilled to be working with such an iconic and timeless brand,” Delta Galil’s chief executive officer Isaac Dabah said in a statement. “It marks another significant step in our growth strategy of partnering with leading global brands and comes on the heels of our recent global licensing agreements with Adidas and Wolford.”
The partnerships with Wolford and Adidas — to create, produce and market women’s lingerie and swimwear collections with the Austrian brand and to design, manufacture and distribute men’s and women’s underwear collections under Adidas’ Badge of Sport and Originals labels — were revealed days apart in June as Delta Galil attempted to gain share in the global men’s and women’s innerwear and swimwear markets. The firm plans to roll out both collections in spring and summer 2022.
In addition to the licensing deals with Adidas and Wolford, Delta Galil — which also counts Seven For All Mankind, Splendid, Bare Necessities, Schiesser, Eminence, Delta, P.J. Salvage, Karen Neuburger, Nearly Nude and Fix in its portfolio of brands — has been on a shopping spree over the last two years. The company purchased lingerie start-up Brayola in January 2020 for more than $1 million.
The following August, Delta Galil acquired lingerie and swimwear e-tailer Bare Necessities for an undisclosed amount. The platform, which was founded in 1998 and later acquired by Walmart U.S. e-commerce in October 2018, sells more than 160 brands across the intimates, lingerie, swimwear, shapewear and sleepwear categories.
“During the quarter, we continued our focus on digital innovation,” Dabah said on Thursday. “With our merged Bare Necessities and Brayola platform, we are now in the process of introducing our own brands through our digital channel. We have exciting plans to grow this area, which we expect to increase sales and profitability over time.”
Delta Galil also revealed third-quarter earnings Thursday morning with total sales for the three-month period ended Sept. 30 topping $501 million, up from nearly $383 million a year earlier, thanks to strength across all regions. In addition, e-commerce revenues on the company’s own website grew 102 percent to $52.4 million for the quarter, year-over-year, driven by gains in the Bare Necessities’ e-commerce business.
Delta Galil logged $32.4 million in profits and updated its 2021 fiscal-year guidance as a result. The company, which previously expected full-year profits to be between $96 million and $104 million, now expects net income to be in the range of $113 million and $117 million.
“We are very pleased with our performance this quarter, which represents a strong trend of three consecutive quarters of record revenues, four consecutive quarters of record gross margin and five consecutive quarters of record operating margin,” Dabah said. “We saw a significant increase in [earnings before interest and taxes], driven by higher sales in all segments and geographic areas with improved products, customers and channels mix and saw the benefits of operational and financial efficiencies we implemented over the last 15 months.
“We have solid plans in place, a strong balance sheet and operating cash flow, all of which position us well to continue on the growth trajectory we enjoyed this quarter,” he added.