February 25, 2021 – Gildan Activewear Inc. (GIL: TSX and NYSE) announced results for the fourth quarter and year ended January 3, 2021.
“Our Back to Basics strategy put us on a sound footing going into the pandemic and the additional actions we have taken during 2020 have enhanced our competitive positioning as we work towards a stronger environment, growth, and achieving our long-term profitability targets” said Glenn J. Chamandy, President and CEO of Gildan. “Further, against the backdrop of the pandemic and the headwind of back to back hurricanes in Central America our team showed exceptional operational execution and delivered strong results for the fourth quarter.”
Fourth Quarter Results
Net sales for the fourth quarter ending January 3, 2021, of $690.2 million (all figures US) were up 4.8% compared to the fourth quarter of 2019. Activewear sales amounted to $537.9 million, up 11.3%, and sales of $152.3 million in the hosiery and underwear category were down 13.0% compared to the Q4 2019.
The decline in hosiery and underwear sales was driven entirely by lower sales of socks, a category that has been more heavily impacted by the current pandemic environment, particularly within national chains and department stores, as well as sports specialty channels. Underwear sales were up 20% in the quarter, significantly outpacing industry demand and reflecting continued market share gains with private label men’s underwear program, as well as with Gildan’s branded underwear products.
Net earnings for the quarter amounted to $67.4 million, or $0.34 per diluted share, compared to net earnings of $32.5 million, or $0.16 per diluted share.
Gildan generated record free cash flow in the quarter totalling $278 million, up from $241 million last year. The improvement in free cash flow was driven primarily by a significant reduction in inventories and lower capital expenditures.
Full Year Results
Net sales for 2020 totalled $1,981.3 million, down 29.8% from the prior year, reflecting declines of 33.8% in activewear and 14.1% in the hosiery and underwear category. The overall sales decline in 2020 was largely volume-driven as a result of the significant adverse impact that the global COVID-19 pandemic has had on economic activity worldwide.
For the full press release, please visit https://gildancorp.com/media/uploads/news/2021-02/bgildan_q4_2020_earnings_press_release.pdf