Gildan Activewear Inc, the world's biggest T-shirt manufacturer, has spent US$5 million on land and buildings in Nicaragua where it intends to build a fleece production facility.

The total capital cost of the project, including the land and buildings, is estimated at approximately US$60 million.

The company, which last month announced a decision last month to close a plant in Honduras that employs 1,800 people amid allegations of labour abuse at its offshore plants, said it is also continuing to develop its new manufacturing hubs in the Dominican Republic and Haiti.

Meanwhile, third quarter net earnings at the Montreal-based company reached record levels, boosted by higher unit sales, manufacturing efficiencies and more favourable pricing

For the three months ended 4 July 2004 net earnings were US$26.2 million, up 20.2 per cent from US$21.8 million a year ago.

The quarter included charges of US$0.03 per share from the sale of surplus equipment in its Canadian yarn-spinning and textile operations.

Sales in the quarter were US$168.4 million, up 17.4 per cent from $143.4 million in the third quarter of fiscal 2003.

Gildan, which also makes polo and sweatshirts, said unit shipments in Europe increased by 43.7 per cent over the third quarter last year, and shipments in Canada were up by 32.6 per cent.

Due to the stronger than projected third quarter results, and its outlook for the fourth quarter, the company is projecting EPS for the full fiscal year of approximately US$2.20 per diluted share.