Delta Apparel said sales of its Soffe brand climbed 20.8% in its first quarter ended Sept. 27, with all of its distribution channels achieving double digit sales growth. Overall sales in the Delta’s retail-ready segment, which also includes the Junkfood t-shirt brand, rose 36.6% to $41.4 million. Junkfood’s sales were up 88.4%. Operating income in the segment surged 95.3% to $5.3 million, due primarily to increased sales and leveraged fixed costs in both businesses.
On a conference call, management said the military and big box sporting goods stores drove the largest dollar increases for Soffe during the quarter.
“The Soffe brand is performing well at retail and we have earned additional product adoptions through spring with key retailers,” said Bob Humphreys, Delta’s president and CEO, on the call. “Our bookstore business is expanding its customer base and is positioned to grow as the year progresses. Our team sports business driven by our Intensity Athletic brand is also enjoying solid growth. We are concentrating on basic product for the smaller sporting goods retailers which should allow us to expand our presence with this market segment.”
Humphreys also said the Soffe Internet site continues to drive sales.
The activewear segment, comprised of Delta and FunTees, saw sales climb 18.4% to $50 million. Delta, increasing 28.8%, regained market share in basic t-shirts as a new offshore textile facility improved its in-stock inventory position. FunTees sales were up less than 1%. The segment generated an operating loss of $2.9 million, driven by lower margins as price increases had not been fully realized in either business to cover the higher raw material and energy prices. The loss also reflected higher manufacturing costs tied to past restructuring activities.
Company-wide, DLA’s sales rose 26% to $91.4 million. Net income reached $700,000, or 8 cents a share, compared to a prior year loss of $1.5 million, or 18 cents, which included 16-cents per share of restructuring related expenses.
