14% increase in net sales of Gildan Activewear in the fourth quarter

Gildan Activewear Inc.’s net sales for the fourth quarter ending Jan. 2, 2022 of $784 million increased 14% from a year ago, including activewear sales of $627 million, in up 17% and sales of $157 million in the hosiery and underwear category, up 3 percent from the prior year quarter.

Gildan also announced the appointment of Dhaval Buch to the company’s board of directors. With Buch’s appointment, the company’s board of directors now has eleven members. He will sit on the Corporate Governance and Social Responsibility Committee of the Board of Directors.

“We ended the year with a strong finish, surpassing pre-pandemic levels and setting record results to build on. We generated record fourth quarter sales of $784 million, up 14% from a year ago and 19% from the fourth quarter of 2019. Strong sales and margin performance results in record earnings for the quarter with GAAP diluted EPS of 89 cents, and adjusted diluted EPS of 76 cents, up 69% from a year ago and 85% from the same quarter in 2019,” said Glenn J. Chamandy, President and Chief Executive Officer of Gildan.

Highlights of Gildan’s fourth quarter results

Compared to 2019, net sales for the quarter increased by 19%, thanks to the strong performance of sportswear.

The company generated gross profit of $229 million in the fourth quarter and adjusted gross profit1 of $240 million, up 48% and 35%, respectively, from a year earlier, driven by growth in our sales and the solid performance of our margins. Gross margin of 29.2% in the quarter increased 670 basis points from 2020, while adjusted gross margin of 30.6% increased 480 basis points from 25.8% l ‘last year.

Fourth-quarter operating profit of $177 million or 22.6 percent of sales was up from $79 million or 11.4 percent of sales last year. On an adjusted basis, operating profit was $160 million or 20.4% of sales, compared to $106 million or 15.3% of sales, in the fourth quarter of 2020.

The company reported net income of $174 million, or 89 cents per diluted share, for the fourth quarter and adjusted net income of $149 million, or 76 cents per diluted share. That compares to net income of $67 million or 34 cents per diluted share and adjusted net income of $90 million or 45 cents per diluted share, respectively, in the fourth quarter of last year.

Gildan Activewear net sales up 48% for the full year

The company had net sales of $2,923 million in 2021, up 48% from a year earlier, reflecting increases of 58% to $2,365 million in activewear and 16% at $558 million in the hosiery and underwear category compared to 2020.

The company generated gross profit of $940 million and gross margin of 32.2%, compared to $249 million and 12.6%, respectively, the previous year. On an adjusted basis, gross margin for 2021 totaled $903 million from $306 million the prior year, resulting in adjusted gross margin in 2021 that more than doubled to 30.9% from 15, 3% in 2020.

For the full year, the company reported net income of $607 million or $3.07 per diluted share, and adjusted net income of $538 million or $2.72 per diluted share. That compares to a net loss of $225 million or $1.14 per diluted share and an adjusted net loss of $36 million or 18 cents per diluted share in 2020.

The Company’s Board of Directors has approved a 10% increase in the current quarterly dividend amount and declared a cash dividend of 169 cents per share, payable April 11, 2022, to shareholders of record March 17, 2022.

Gildan appoints Dhaval Buch to its board of directors

Buch, the company said, is currently a senior adviser to Blackstone Private Equity, a leading global investment firm, and the Mahindra Group, a large India-based multinational with interests in the automotive, agricultural and financial sectors.

“Dhaval is an accomplished business leader and his international expertise in supply chain operations and deep knowledge of sustainable sourcing make him an ideal addition to our board,” said Gildan Chairman Donald C.Berg.

Prior to that, Buch had a 35-year career as a business leader at Unilever, where he last served as global chief purchasing officer for the company. During his career at Unilever, Buch also led Unilever’s supply chain for Asia and Africa. Previously, he held positions of increasing responsibility at Hindustan Unilever Limited, a listed subsidiary of Unilever in India, culminating in supply chain management for South Asia and as an executive director on the board of administration of Hindustan Unilever Limited.

Ann J. Cox