Gildan profit jumps as cotton prices decline
(Reuters) - Canadian apparel maker Gildan Activewear Inc (GIL.TO: Quote) raised the lower end of its full-year earnings outlook for the second time this year, saying it expects higher sales of printwear and branded apparel.
Gildan now expects 2013 earnings to be $2.67-$2.70 per share, up from $2.65-$2.70 forecast earlier.
Analysts on average had expected earnings of $2.68 cents per share, according to Thomson Reuters I/B/E/S.
The Montreal-based company reported a 47 percent jump in third-quarter profit on Thursday. Net income rose to $115.8 million, or 94 cents per share, helped by lower cotton prices and higher sales volume.
Margins improved as cotton prices fell 4 percent to 85.61 cents per pound between April and June.
Profit got a boost also from a favorable product mix for both printwear and branded apparel and better supply chain and manufacturing efficiencies, Gildan said.
The company supplies T-shirts and other basic clothing items to screenprinting companies and makes private-label and branded socks for mass-market retailers.
Gildan, however, has been shifting its focus to its own brands such as Gildan underwear and Gold Toe socks. The company began shipping Gildan underwear in the quarter.
Sales rose 2 percent to $614.3 million but came below the estimates of the company and analysts. Gildan said production constraints prevented it from capitalizing on peak demand season. Continued...