February 20,2020 – Gildan Activewear Inc. (GIL: TSX and NYSE) announced results for the fourth quarter and year ended December 29, 2019.

Gildan Activewear reported net sales of $659 million in the quarter, an 11.3% decrease compared to the fourth quarter of 2018 due primarily to a 15.1% decline in activewear sales, slightly offset by a 1.0% sales increase in the hosiery and underwear category. The decline in overall net sales in the quarter was mainly the result of lower unit sales volumes and the negative impact of the $19 million sales return allowance recorded in the fourth quarter.

In the activewear segment, Gildan generated sales of $483.5 million in the fourth quarter, down $85.8 million compared to the fourth quarter last year, due primarily to lower unit sales volumes stemming from the combined impact of lower POS from distributors to screenprinters and distributor inventory de-stocking, as well as the impact of the sales return allowance.

Sales in the hosiery and underwear category for the quarter totaled $175.1 million, up $1.7 million over the fourth quarter in 2018, as strong double-digit sales volume growth of underwear, which also drove more favourable product-mix, was largely offset by lower socks sales.

Full Year Results

For the full year, the company generated sales of $2,824 million, down 2.9% over 2018 and in line with its guidance of a low-single-digit sales decline.

At the end of the quarter, Gildan decided to significantly reduce its imprintables product line SKU base, by exiting all ship to-the-piece activities and discontinuing overlapping and less productive styles and SKUs between brands, an important initiative related to our Back to Basics strategy intended to simplify their product portfolio and reduce complexity in manufacturing and distribution.