Second quarter results at activewear maker Delta Apparel Inc are likely to be within earlier guidance, the company said yesterday (14 January), despite what it describes as the "slowing retail environment" and weak consumer demand for clothing.

For the second quarter to 29 December, the Duluth, Georgia based company said it expects second quarter revenues to be $68m to $69m, versus earlier expectations of $64m to $68m.

Its quarterly loss will be $0.33 to $0.34 per share compared with prior guidance of a loss of $0.33 to $0.37.

For fiscal 2008, sales expectations are $315m to $340m and earnings of $0.62 to $0.76 per share.

However, the company says it remains "cautious" over the general economy and current state of the retail environment.

Robert W Humphreys, president and chief executive officer said: "During the quarter we made significant progress in positioning our business for growth and profitability in the future."

Its new, state-of-the-art textile facility in Honduras produced its first dyed fabric during December, and is on pace to reach its first target of 500,000 pounds of weekly production in the fiscal 2008 fourth quarter.

"This facility should be providing our activewear business with lower cost production to drive enhanced profitability in the fourth quarter of the fiscal year," Humphreys said. 

A new jointly branded apparel line called "Junkfood Loves Gap Kids", a partnership between Delta Apparel's Junkfood Clothing subsidiary and retailer Gap Kids, is to be rolled out in 200 stores and "could grow into a very successful, long-term relationship."

And the Soffe military uniform business is bidding on a new military training uniform, including a specially designed shirt and shorts, which could add $2-3m in sales in the second half of the year.