For the three months to 2 April, the Montreal-based company said net income increased by 32.1% to US$83.5m

For the three months to 2 April, the Montreal-based company said net income increased by 32.1% to US$83.5m

Apparel maker Gildan Activewear has reaffirmed its full-year guidance after what it called a "strong" first-quarter that saw both earnings and revenue rise.

For the three months to 29 April, the Montreal-based company said net income increased by 32.1% to US$83.5m from $63.2m a year earlier. Excluding restructuring and acquisition-related costs, adjusted net earnings were $90.1m.

Net sales also grew, up 12.2% to $665.4m from $593.3m in the year ago period, reflecting a 13.6% in the printwear segment and 9.2% in branded apparel. Growth was primarily driven by the impact of the Alstyle and Peds acquisitions, as well as the American Apparel acquisition, which closed during the first quarter of 2017, and organic growth driven by higher net selling prices and favourable product-mix. However, Gildan added these positive factors were partially offset by unfavourable foreign exchange and the planned exit of private label programmes in branded apparel.

Net sales for the printwear business amounted to $445.6m in the quarter, up 13.6% from $392.1m in the year-ago period. The increase was mainly due to sales of $39.5m from the Alstyle and American Apparel acquisitions, higher net selling prices, and favourable product-mix, partly offset by unfavourable foreign exchange impacts.

Meanwhile, net sales for the branded apparel segment reached $219.7m, up 9.2% from $201.2m. The increase was primarily due to sales of $20.9m from the Peds acquisition and organic sales growth which was partially offset by the impact from the planned exit of certain private label programmes.

Consolidated gross margin in the quarter was 28.4%, up 200 basis points compared to the same period last year, as the positive net impact of net selling prices, manufacturing and raw material costs were partially offset by unfavourable foreign exchange.

The company reaffirmed its full-year 2017 financial guidance of adjusted diluted EPS in the range of $1.60-$1.70 on expected consolidated net sales growth in the high single-digit range. Net sales in 2017 in the printwear and branded apparel segments are each expected to increase in the high single digit range.

In March, Gildan confirmed American Apparel products will continue to be made in the US, after revealing it has secured contractors in the country to support production.

American Apparel will continue to be made in the US

Gildan acquired the American Apparel brand with a US$88m bid at a court supervised auction for the bankrupt retailer in January.

Gildan acquires American Apparel with US$88m bid