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February 16, 2022

Delta Galil ups 2022 outlook on record Q4 and FY21 results

Israel-based apparel manufacturer Delta Galil has increased its 2022 financial guidance on the back of record financial results for the fourth quarter and full year.

By Beth Wright

Reporting its results for the three and 12 months ended 31 December 2021, Delta Galil said fourth-quarter sales rose 26% to a record US$578m from $459.7m in the prior-year period. 

Effective as of the second quarter of 2021, Delta Galil reorganised its business segments to better reflect and align with its strategic focus. The new segments – Brands (owned and licensed), Private Label, Delta Israel, 7 for All Mankind and Online Retailer – all contributed to the recent sales growth. Growth was also seen across all geographic regions and sales channels.

E-commerce own website sales declined 12% to $66.9m for the fourth quarter compared to a year earlier, but were up 149% compared to 2019.

Net income for the quarter surged 92% to $45.5m from $23.7m last year. Excluding one-time items, net income was $45.5m, marking a 67% increase compared to $27.3m for the fourth quarter of 2020.

For the 2021 full year, sales totalled $1.95bn, a 35% increase from $1.45bn a year prior. E-commerce own website sales were up 66% compared to $152.5m in 2020.

Net income was $120.3m, compared to a net loss of $40.5m for the same period last year. Excluding one-time items, net income for the 2021 full year was $124.2m, compared to $3.8m for the 2020 full year.

“We are very pleased to have completed 2021 with an exceptional quarter, reflecting the successful execution of our growth strategy,” said Isaac Dabah, CEO of Delta Galil. “Throughout the year, we consistently delivered higher sales and better profitability, as demonstrated by Q4 representing our fourth consecutive quarter of record revenues and sixth consecutive quarter of record operating margin. We concluded the year with strong growth in all channels, geographies and segments, and expect momentum to continue in 2022. 

“With a solid foundation in place and enhanced performance of our growth engines, we will continue to invest in our technology, manufacturing and distribution infrastructure to support our growth needs.”

As a result of the company’s exceeded 2021 guidance, combined with current market conditions, Delta Galil has increased the lower end of its 2022 financial guidance. 

It now expects full-year 2022 sales to range between $2.08-$2.14bn, representing an increase of 7-9%, compared to 2021 sales of $1.95bn. 

Full-year 2022 net income is expected to range between $138-$145m, representing an increase of 11-17% from 2021 net income of $124.2m.

Last summer, Delta Galil struck a licensing agreement with Adidas to design, manufacture and distribute men’s and women’s underwear collections under Adidas’ Badge of Sport and Originals labels.

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