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May 10, 2022

Delta Apparel Q2 profit soars 130% to surpass $10m

Activewear and lifestyle apparel products maker Delta Apparel has reported record second-quarter earnings and revenue, with sales surpassing US$131m.

By Beth Wright

For the three months ended 2 April, Delta Apparel saw net sales amount to $131.7m, representing an increase of 21% compared to the prior-year second-quarter net sales of $108.6m. Net sales in the Delta Group segment grew 22% to $115.3m, while Salt Life segment net sales were up 14% to $16.4m.

Net income was $10.1m, marking a rise of more than 130% compared to $4.4m for the same period a year prior, driven by higher operating profits and a lower tax rate.

On a consolidated basis, gross margins were 25.5%, improving 270 basis points from 22.8% in the prior year, which was ahead of expectations and largely driven by increased selling prices and production efficiencies.

CEO Robert Humphreys says: “We delivered strong second-quarter results that met the high end of our expectations and reached a second-quarter record for our company with sales surpassing $131m.

“The continued strength in current year results reflects strong performance across both our Delta and Salt Life business segments. Significant growth in our Delta group segment was achieved through unit sales growth, increased value-added services, and our continued ability to update our pricing in the marketplace to offset higher input costs. Salt Life’s outstanding performance was fueled by a healthy combination of retail growth and strong wholesale channel demand.”

Humphreys continued, “Our five focused go-to-market strategies and vertical supply chain are enjoying strong demand across all the channels we serve. We continue to see the results of our investments, with increased manufacturing capacity throughout our production network resulting in higher unit growth in our Delta business segment. Within the Salt Life segment, we have increased the number of retail stores to 18 locations across six states, and we are on track to achieving our target of at least 20 retail stores opened by the end of fiscal 2022. Additionally, we have continued to see strong wholesale demand and consumer interest in our e-commerce channel.”

Last month, Delta Apparel said it is expanding its digital print business through the installation and utilisation of newly developed digital print technology.

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