Gildan Activewear Inc gets Q4 sales bump from T-shirt sales, reports US$67.6 million profit

MONTREAL – Gildan Activewear Inc. (TSX:GIL) says a 20 per cent rise in Gildan-branded underwear sales as well as bigger growth at its printwear segment helped the clothing manufacturer to a US$67.6 million profit in the fourth quarter.

Overall sales were up 39.2 percent to US$543.8 million, from US$390.Six million a year earlier, and above the company’s estimate – mainly because of unexpectedly high sales of T-shirts made by its printwear segment.

The printwear segment taken into account $284.9 million of sales, up from US$160.3 million in the previous year’s fourth quarter, including a $48-million inventory devaluation that didn’t recur. Excluding the inventory markdown, printwear sales were up 37 per cent from the same time last year.

Sales of the higher-margin branded apparel were US$258.9 million, up 12.4 per cent from US$230.3 million. The segment includes sales of Gildan underwear, which had been focus of the advertising campaign featuring country singer Blake Shelton.

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Gildan’s net profit for that quarter ended Jan. 3 – reported in U.S. currency – was comparable to 28 cents per share, as well as 28 cents after adjustments.

In the year-earlier period, Gildan had a unique quarterly net lack of $41.2 million, or 17 cents per share, and an adjusted lack of $37.Six million or 15 cents per share.

For next season, Gildan is projecting between $1.50 and $1.60 per share of adjusted earnings per share Up from $1.46 this past year and $1.14 the year before. It’s estimating 12-month sales for the coming year will be above US$2.6 billion, in contrast to $2.57 billion for the year ended Jan. 3, 2016, and $2.3 billion last year.

The Montreal-based company – which has its manufacturing operations outside of Canada – says its quarterly dividend to shareholders will rise by 20 per cent to 7.8 U.S. cents per share payable April 4.

It has also received approval to repurchase and cancel up to nearly 12.Two million common shares, about five per cent from the public float, within the coming year.