Restructuring costs of $10.8m, coupled with price pressures and increased competition in the US and Europe, have widened first quarter losses at private label apparel maker Delta Galil Industries Ltd.

Net loss was $13.2m, or $0.70 loss per diluted share, compared to a loss of $1.0m, or $0.05 loss per diluted share, in last year's quarter.

Excluding the restructuring expenses, Delta says it would have reported a net loss of $2.4m, or $0.13 loss per diluted share.

The Tel Aviv based firm, which makes ladies' intimate apparel, socks, men's underwear, baby-wear and leisurewear, said sales were also down in the three months to 31 March, falling 7.4% to $159.4m from $172.1m last time.

In March the company announced plans to restructure its business, including closures and downsizing at certain facilities and transferring production to lower cost countries.

The decision is based on what CEO Aviram Lahav describes as "the continuation of erosion in the selling prices, increased competition, rising prices in the manufacturing cost and the strengthening of the shekel against the dollar."

Delta says it intends to expand operations in Egypt, which will become the main manufacturing facility for customers in Europe and the US upper market.

It also plans to move sock production to lower cost facilities in Bulgaria and in the Far East.

"We anticipate that these measures will contribute to the improvement of Delta's competitiveness and its return to profitability," explained Mr Lahav.

The company operates manufacturing facilities in Israel, Jordan, Egypt, Turkey, Eastern Europe, Central America, the Caribbean and the Far East and produces for brands such as Calvin Klein, Hugo Boss, Nike and Ralph Lauren, as well as private label retailers including Wal-Mart, Marks & Spencer, Target, Victoria's Secret, and JC Penney.

It has already reorganised its Far East activities, including the closure of a sewing plant in China, and is focusing its Chinese operations on procuring finished goods and raw materials, and product development. Far East self-production is to be concentrated in Thailand.