• Q3 profit edges up 0.3% to $123.1m
  • Sales climb 1.3% to $674.5m
  • Lowers FY guidance 
Sales climbed 1.3% during the quarter

Sales climbed 1.3% during the quarter

Apparel maker Gildan Activewear has lowered its full-year outlook, after a third quarter in which it saw lower-than-expected sales of its Gildan branded clothing and a weaker-than-expected back-to-school period. 

The Montreal based company, which is a major supplier of underwear and socks, said net earnings edged up to US$123.1m for the three months to 4 October, compared to $122.7m in the same period a year ago. 

Sales climbed 1.3% to $674.5m from $666m last year, with printwear sales edging up 1.1% to $440.5m, and branded apparel sales were up 1.7% to $234m. 

Gildan said sales were below its guidance of close to $700m because of lower than expected branded apparel sales due to lower than forecast inventory replenishment by a US major retail customer and weaker than expected back-to-school demand. Printwear was impacted by lower net selling prices  and an unfavourable product mix.

Gross margin improved to 31.4% from 28.8% in the prior year. 

The company now expects full-year adjusted EPS to range from $1.46-$1.48 assuming sales close to $2.55bn. This is down from its earlier guidance of a respective $1.50 and near to $2.6bn.

Having said that, Gildan says fourth-quarter earnings will be in excess of any previous year as the group benefits from manufacturing cost reductions from its capital expenditure programmes and lower cotton costs, combined with continuing top-line growth in sales revenues in both its printwear and branded apparel segments.