ISRAEL: Tefron Q2 losses narrow on turnaround plan
- Q2 losses narrowed to US$1.6m against $1.9m
- Q2 sales rose 15.6% to $24.5m
- Gross profit rose 86.9% to $4.3m
Israel-based lingerie and active-wear manufacturer Tefron saw second-quarter losses narrow as the company said it sees the impacts of its turnaround plan.
For the quarter ended 30 June, losses narrowed to US$1.6m against $1.9m in the same period of the previous year. Sales rose 15.6% over the period to $24.5m, while gross profit rose 86.9% to $4.3m.
Gross profit margin reached 14.7% for the quarter against 9.2% in the same period of the previous year.
For the first-half, net losses narrowed to $4m against a loss of $5.2m in the same period of the previous year. Sales for the half increased 11.9% to $56.8m.
The company attributed the first-half sales growth to improved sales in in its seamless range of intimates and active wear, as well as activities acquired from Canadian company Nouvelle.
Gross profit more than doubled to $9.2m against $4.1m in the same period of the previous year. Gross margin reached 16.3% against 8% in the first-half of 2010.
"Tefron's strong sales and operational improvements provide a clear indication that we are growing in accord with our turnaround plan," said CEO Amit Meridor. "I am very pleased to report that the strong sales reflect both higher sales to existing customers, as well as an important broadening of the customer base.
"These first half results do not yet reflect the full potential of the acquisition of the seamless assets of Nouvelle Inc.of Canada.
"Not only is the organic improvement in performance seen in the first half of 2011 expected to continue, but we expect a greater contribution to growth in the second half of the year from the Nouvelle acquisition, with an important increase in sales to the mass market in the USA, as well as in European markets.
"Looking further forward, Tefron has been focusing much of our development expenditure and investment in new technology toward the launch of new products in the sports market for 2012.
"We believe that these products will enable us to return to our global leadership position in seamless technology and the preliminary indications regarding the new products are very positive."
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