Gildan Activewear Inc. announced unaudited consolidated earnings results for the second quarter and six months ended 2013. For the quarter, the company reported net earnings of $72.3 million or $0.59 per share on a diluted basis, compared with net earnings of $26.9 million or $0.22 per share in the second quarter of fiscal 2012. Before the restructuring and acquisition-related costs, adjusted net earnings were $72.7 million or $0.59 per share, compared to adjusted net earnings of $27.8 million or $0.23 per share in the second quarter of last year. Net sales amounted to $523.0 million, up 8.4% from $482.6 million in the second quarter of fiscal 2012. Operating income was $101.8 million against $52.7 million a year ago. EBITDA was $101.8 million against $52.7 million a year ago. Cash flows from operating activities were 24.9 million against $3.0 million a year ago. For the six months, net sales revenues amounted to $943.8 million, up 20.0% from $786.4 million in fiscal 2012. The increase in net sales versus fiscal 2012 was due to the acquisition of Anvil, higher Printwear unit sales volumes, and growth in sales of Gildan branded activewear to retail customers. These factors were partially offset by lower net selling prices for Printwear and lower sales of socks. Sales were also impacted by the inventory devaluation discount in the second quarter. Net earnings were $107.6 million or $0.88 per share on a diluted basis, compared to net loss of $19.2 million or $0.16 per share in the first six months of fiscal 2012. Adjusted net earnings before restructuring and acquisition-related costs amounted to $111.8 million or $0.91 per share, compared to adjusted net loss of $18.0 million or $0.15 per share in fiscal 2012. The increase in adjusted EPS in fiscal 2013 compared to last year reflected improved results in both Printwear and Branded Apparel, due to lower cotton costs, higher unit sales volumes, and more favourable product-mix, partially offset by lower Printwear net selling prices, increased selling, general and administrative expenses, and higher income taxes. Operating income was $114.7 million against operating loss of $14.2 million a year ago. EBITDA was $163.7 million against $26.4 million a year ago. Cash flows from operating activities were70.3 million against cash flows used in operating activities of $109.4 million a year ago. The company provided earnings guidance for the third quarter and fiscal 2013. For the quarter, the company is projecting adjusted net earnings per share of $0.92-$0.95, compared with adjusted EPS of $0.66. The projected growth in EPS compared with the third quarter of last year reflects significantly lower cotton costs together with assumed higher unit sales volumes and more favourable product-mix for both Printwear and Branded Apparel, and increased supply chain and manufacturing efficiencies, which are projected to be partially offset by lower net selling prices for Printwear, higher selling, general and administrative expenses and higher income taxes. Net sales revenues in the third quarter are projected to be approximately $630 million. For fiscal 2013, net sales are now projected to be slightly in excess of $2.15 billion. Net sales for Printwear are projected to be approximately $1.45 billion, and net sales for Branded Apparel are projected to be slightly in excess of $0.7 billion. The company now expects full year adjusted EPS of $2.65-$2.70, which is at the upper end of its previous guidance range of EPS of $2.60-$2.70 for the full fiscal year, as the more favourable than projected second quarter results and projected increased supply chain and manufacturing efficiencies in the balance of the year are assumed to offset the negative impact of higher than previously projected cotton costs in the fourth quarter. The company is continuing to project free cash flow in excess of $200 million in fiscal 2013. Capital expenditures are still projected to be approximately $200 million, including a total of approximately $85 million for yarn-spinning investments. The fiscal 2013 capital expenditure program includes approximately $10 million to modernize the former Anvil textile manufacturing facility and further expand its product capabilities.

Gildan Activewear Inc. announced that the Board of Directors has declared a cash dividend of U.S. $0.09 per share, payable on June 10, 2013 to shareholders of record on May 16, 2013.

Gildan Activewear Inc., Q2 2013 Earnings Call, May 02, 2013