For the fourth quarter ending 31 December 2023, net sales increased 8.7% from $720m to $783m over the prior year. This included activewear sales of $644m, up 8%, and sales of $139m in the hosiery and underwear category up 11%.
Gildan noted this increase in activewear sales was due to higher volumes, driven by Point Of Sale (POS) as well as higher levels of customer replenishment compared to the prior year. While, sales in the hosiery and underwear category were attributed to higher volumes, driven by a combination of better POS and the rollout of new programmes in the mass retail channel.
The company explained that while an industry-wide soft demand environment meant that revenue growth during this period was challenging to achieve, Gildan has continued to drive market share gains in key product categories.
In the fourth quarter, operating income increased from $92.6m to $178.1m when compared to the same period the year before. The company said this increase reflected higher sales and higher adjusted gross margin.
Net earnings increased by 82.7% to $153.3m from $83.9m.
Gildan highlighted the company incurred restructuring and acquisition-related costs of $11m, mainly due to the previously announced closure of a yarn-spinning plant in the US, compared to $6m of restructuring and acquisition-related costs in the prior year.
Vince Tyra, president and CEO of Gildan Activewear who was officially named CEO in January 2024, believes the outstanding operational execution by the company's highly skilled team of employees across its global footprint delivered the strong Q4 results.
He said: "As the company celebrates its 40th anniversary this year, I see a bright future ahead, where we can leverage our strengths and continue to enhance value for all stakeholders. Since joining the company, I’ve had the opportunity to visit with hundreds of employees in Montreal and Honduras and I've met with many of our key customers during the recent industry trade shows in Las Vegas, Nevada and Long Beach, California, which fuelled my excitement for the future."
Full year results in a brief
- Net sales down 1.4% year-over-year from $3.24bn to $3.20bn.
- Operating income increased by 6.7% to $644m from the previous year's $603.4m. This included the benefits from a $77m net insurance gain, $41m non-cash reversal of a prior-year impairment charge, and $25m gain from sale and leaseback of a US distribution facility.
- Net earnings decreased 1.5% to $534m when compared to $542m the year before.
Gildan added that overall, 2023 was a year of strong progress for its Sustainable Growth strategy and its three key pillars focused on innovation, manufacturing capacity and ESG.
Gildan 2024 outlook
For 2024, Gildan expects revenue growth for the full year to be flat to up to low-single digits. The company forecasts that POS trends will continue to improve compared to 2023, reflecting potential for recovery in various markets, as well as overall growth opportunities.
Gildan pointed out that its top line guidance takes into account the expiration of the Under Armour sock license agreement on 31 March 2024, which is expected to have minimal impact on its profitability.
As of 2024, Gildan shared that it is embarking on its third year of implementing its Next Generation ESG strategy, which encompasses a broad range of initiatives, including reducing carbon footprint and water intensity; fostering a circular economy; supporting regional economic development; ensuring respect for human rights; and maintaining safety standards throughout the supply chain.
The company emphasised the strategy also embraces a commitment to people, with a focus on investing in its workforce, promoting diversity and inclusion, in addition to enhancing ESG transparency.
In November Gildan reported its profits dropped in Q3 on the back of lower demand and higher costs.
