• Net income fell 16.2% to $1.6m
  • Sales were down 4.2% 
  • Soffe brand sales plunged 30%

US clothing company Delta Apparel saw third quarter net income decline on falling sales, which it attributed to weaker sales in the Soffe sportswear brand.

The company said net income fell 16.2% to US$1.6m over the quarter ended 30 March. Sales fell 4.2% over the period to $120.1m, with revenue growth in the basics business and all branded business units except for Soffe.

"Cooler weather conditions throughout the country, combined with continued weakness in certain retail channels, resulted in slower than expected overall sales during the third quarter. This, along with continued softness in the Soffe business, resulted in lower comparable third quarter revenue and net income," a statement said.

The 10% decline in branded segment sales to $52.6m was attributed to a 30% sales decline in the Soffe business, due primarily to turmoil in the current retail environment and a strategic shift by some large retailers from branded products to more private label products.

"I believe this attests to the strength and desirability of our products, but we obviously have a good deal of work to do at Soffe to bring the business back to our expectations," said chairman and CEO Robert Humphreys.

"We have made some key management changes within Soffe that we believe will return that business to the strong performer it has been in the past. These changes go all the way to the top of that business and should have a profound effect, particularly in the areas of marketing and sales.

"We are making a rigorous effort to regain lost volume and to realign the Soffe business to meet current market demands, and we are already seeing some limited results from these efforts.

"In the meantime, we are taking immediate steps to reduce costs in order to return Soffe to profitability at current sales levels."