The only two certainties in this world are death and taxes, or so say the wise prophets. In this case, deaths better half paid a visit to Gildan Activewear during the fourth quarter as the company reported net sales jumped over 20%.
The assessment resulted in a charge in the fiscal fourth quarter, amounting to approximately $27 million, or 22 cents per share, including a provision for provincial taxes.
As a result, fourth quarter net income dropped 47.6% to $21.4 million, or 18 cents per diluted share, compared to $40.9 million, or 34 cents per diluted share, in the year-ago period even as net sales jumped 27.4% to $324.7 million from $254.9 million last year. Gross margins decreased 10 basis points to 32.1% of net sales, while SG&A expenses rose 110 basis points to 12.1% of net sales for the quarter.
The company attributed its strong sales growth to the acquisition of Prewett, an approximate 10.2% increase in activewear unit selling prices and an 8.5% increase in unit sales volumes for activewear and underwear. The growth in activewear unit sales in the fourth quarter was attributed to continuing market share penetration in all product categories in the U.S. wholesale distributor channel. The company claimed a 53.4% share of activewear sales, up from 48.2% last year.
