December 1, 2011 / 11:54 AM / 6 years ago

UPDATE 2-Gildan Q4 profit falls, forecasts Q1 loss

* Q4 EPS $0.40 vs $0.53 year-ago

* Q4 revenue up 34 pct to $529.8 mln

* Sees Q1 loss $0.40 per share, rev about $300 mln (Adds outlook, details)

Dec 1 (Reuters) - Clothing maker Gildan Activewear Inc's fourth-quarter profit fell 14 percent hurt mainly by higher costs and it forecast a first-quarter loss on higher inventories and discounts.

The company forecast a loss of 40 cents per share on sales of about $300 million, due to a hit of 16 cents per share due to a special distributor-inventory discount in the first quarter.

Net profit for the fourth quarter fell to $48.5 million, or 40 cents per share, compared with $56.8 million, or 47 cents a share, a year earlier as Gildan was unable to fully pass on high cotton prices to customers.

Net sales for the quarter rose 30.6 percent to $481.8 million, helped by an increase in average net selling prices of activewear and underwear.

Analysts on an average were expecting the company to earn 40 cents per share, on revenue of $497.33 million, according to Thomson Reuters I/B/E/S.

Gildan, which makes basic clothing items such as T-shirts, socks and underwear, forecast full-year adjusted earnings of $1.30 for fiscal 2012, compared with adjusted earnings of $2.01 in fiscal 2011.

The company is a top supplier to the screenprint market in the United States and Canada, with a market share of more than 60 percent. It sells blank T-shirts, sport shirts and fleece, which are then printed with designs and logos.

It also supplies private label and Gildan-branded socks, primarily to mass-market retailers.

"The combination of weak end-use demand and distributor destocking is projected to result in an approximate 40 percent decline in Gildan's unit sales volumes in the screenprint market in the first quarter, compared with the first quarter of fiscal 2011," the company said in a statement.

Montreal-based Gildan's shares closed at C$24.52 on Wednesday on the Toronto Stock Exchange.

(Reporting by Maneesha Tiwari in Bangalore; Editing by Sreejiraj Eluvangal)

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