Montreal - Gildan Activewear has reported a dip in third quarter net earnings with Hurricane Florence and acquisition related costs both impacting performance.
Net earnings for the three months ended September 30, 2018 were $114.3 million, or $0.55 per share on a diluted basis, compared with net earnings of $116.1 million, or $0.52 per share on a diluted basis, for the same period last year.
Excluding the impact of after-tax restructuring and acquisition-related costs, Gildan reported adjusted net earnings1 of $118.1 million, which were essentially flat compared to last year as higher sales and the reduction in SG&A expenses offset the decline in gross margin and higher financial expenses.
However, during the third quarter, Gildan said it continued to see good momentum in the key growth areas of its business. Total sales grew 5.3 per cent compared to last year, despite the impact of Hurricane Florence, which limited shipments during September.
From a sales perspective, Gildan said it continued to gain ground during the quarter in faster-growing areas, including fashion basics, international markets, global lifestyle brands, and e-commerce, and is starting to capitalize on the shifting emphasis by mass retailers toward their own private label brands. During the quarter, Gildan also secured a new private label underwear program for 2019 with its largest mass retail customer. However, there was also a 16.6 per cent decline in the hosiery and underwear category.