Israel-based apparel manufacturer Delta Galil Industries has moved to a profit for the first quarter as sales rose by 25% on last year.
For the three months to 31 March, net income amounted to US$15.1m, compared to a net loss of $30.5m in the prior-year period, while gross margin increased by 400 basis points to a record first-quarter level of 38.2%, versus 34.2% last time.
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The manufacturer and marketer of branded and private label apparel reported sales of $416.1m, up from $332.7m last year. Excluding the sales of Bare Necessities, which the company acquired last year, first-quarter sales rose 18%, primarily driven by Delta Israel, Delta Global Upper Market, and Delta USA segments.
E-commerce own website sales more than tripled, surging 272% to $70.8m from $19m for the first quarter of 2020. E-commerce customers grew 83% to 54.6m in the first quarter of 2021, from 29.7m last year.
“We are very pleased with our growth momentum and strong first-quarter results, which reflect three consecutive quarters of record operating margin. Our operating profit increased significantly, driven by higher sales across all segments, with particular strength in our online sales, our gross margin improvement, and the effective implementation of the efficiency measures we started to put in place at the middle of last year,” said CEO Isaac Dabah.
“Our operating cash flow continues to be strong, enabling us to reduce our debt to the lowest level in the last three years. With our strong balance sheet, we have the necessary resources to deliver continued innovation and growth, and we look forward to a strong year.”
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By GlobalDataThe company expects full-year 2021 sales to range between $1.78-$1.82bn, representing an increase of 5-8% from 2019 actual sales of $1.69bn. Full-year net income is forecast at between $81.5-$89.5m, representing a 35-49% rise from 2019 actual net income of $60.2m.
