Gildan Activewear Inc. (TSX:GIL)(NYSE:GIL) today announced record
results for the second quarter of a fiscal year, which were in
excess of the guidance range which it had previously provided, in
spite of challenging market conditions and the impact of unseasonal
weather conditions in both operating segments. The Company also
updated its earnings guidance for fiscal 2013 which it had
initiated on November 29, 2012 and reconfirmed on February 6, 2013,
and provided guidance for sales and earnings for the third quarter
of fiscal 2013.
Second Quarter Results
Net earnings were U.S. $72.3 million or U.S. $0.59 per share on
a diluted basis for the second fiscal quarter ended March 31, 2013,
compared with net earnings of U.S. $26.9 million or U.S. $0.22 per
share in the second quarter of fiscal 2012. Results for the second
quarter of fiscal 2013 include restructuring and
acquisition-related costs amounting to U.S. $0.4 million after tax.
Before the restructuring and acquisition-related costs, adjusted
net earnings for the second quarter of fiscal 2013 were U.S. $72.7
million or U.S. $0.59 per share, compared to adjusted net earnings
of U.S. $27.8 million or U.S. $0.23 per share in the second quarter
of last year.
The Company had previously projected adjusted net earnings of
U.S. $0.54-$0.57 per share for the second quarter, when it reported
its first quarter results on February 6, 2013. Results were more
favourable than projected due to lower than forecast promotional
discounting in Printwear, partially offset by lower than forecast
unit sales volumes, which the Company believes was largely due to
cooler seasonal weather conditions in the second quarter, and a
charge of U.S. $0.02 per share to provide for the cost of
discontinuing certain Anvil® product-lines in order to re-focus the
brand on contemporary ring-spun products, which had not been
reflected in the Company's earnings guidance.
The growth in the Company's net earnings compared to the second
quarter of last year was due to the benefit of significantly lower
cotton costs together with higher unit sales volumes in both
operating segments, and more favourable product-mix for Branded
Apparel, partially offset by lower selling prices for Printwear,
including the U.S. $0.04 per share impact of a distributor
inventory devaluation discount in the quarter, higher manufacturing
costs, the charge for the discontinuation of Anvil® product-lines,
higher selling, general and administrative expenses and higher
income taxes.
Net sales in the second quarter amounted to U.S. $523.0 million,
up 8.4% from U.S. $482.6 million in the second quarter of fiscal
2012. The Company had projected sales for the second quarter of
approximately U.S. $520 million. Sales for the Printwear segment
amounted to U.S. $368.0 million, up 2.0% from U.S. $360.9 million
in the second quarter of fiscal 2012, and sales for the Branded
Apparel segment were U.S. $155.0 million, up 27.4% from U.S. $121.7
million in the second quarter of last year.
The slight increase in sales in the Printwear segment was due to
approximately 4% unit sales volume growth in the U.S., primarily
due to the acquisition of Anvil, and close to 20% unit sales volume
growth in international markets. The higher unit sales volumes
compared to last year were achieved in spite of lower seasonal
re-stocking by U.S. wholesale distributors than in the second
quarter of fiscal 2012, when distributors replenished inventories
after abnormally high destocking in the first quarter of last year,
and lower seasonal demand for T-shirts by screenprinters due to the
weather conditions in the second quarter. The increase in sales
volumes was largely offset by the impact of lower selling prices,
including the distributor inventory devaluation discount.
The 27.4% growth in sales for the Branded Apparel segment was
due to the impact of the acquisition of Anvil and increased sales
of Gildan® branded activewear to retail customers, partially offset
by slightly lower sales of socks compared to the second quarter of
last year. Consumer spending in the U.S. mass-retail market in the
second quarter was negatively impacted by colder weather
conditions, the later timing of income tax refunds and an increase
in payroll taxes.
Consolidated gross margins in the second quarter were 28.9%
compared to 17.8% last year. The significant recovery in gross
margins was due to the impact of lower-cost cotton and more
favourable product-mix for Branded Apparel, partially offset by the
impact of the reduction in net selling prices for Printwear, the
distributor inventory devaluation discount, higher manufacturing
costs, and the impact of the charge for discontinuation of certain
Anvil® product-lines. The increase in manufacturing costs was due
to short-term issues impacting the cost of goods produced in the
first quarter, which were consumed in cost of sales in the second
quarter, inflationary cost increases, and the earlier timing of the
Easter holiday shutdown, which more than offset the positive impact
of manufacturing efficiencies due to the continuing ramp-up of Rio
Nance V.
Selling, general and administrative expenses in the second
quarter were U.S. $73.6 million, or 14.1% of net sales, compared
with U.S. $53.9 million, or 11.2% of net sales, in the second
quarter of last year. The increase in SG&A expenses was
primarily due to increased marketing and advertising expenses,
increased variable performance-driven compensation expenses and the
impact of Anvil.
In the second quarter, the Printwear segment reported operating
income of U.S. $87.3 million, compared to U.S. $50.1 million in the
second quarter of fiscal 2012. The more favourable results for the
Printwear segment were primarily due to the impact of lower cotton
costs, together with higher unit sales volumes and more favourable
product-mix, partially offset by lower net selling prices, higher
manufacturing costs and higher SG&A expenses. The Branded
Apparel segment reported quarterly operating income of U.S. $13.4
million, compared with U.S. $1.1 million in the second quarter of
fiscal 2012. The improved results for Branded Apparel were due to
lower cotton costs, the acquisition of Anvil and a higher-valued
branded product-mix, partially offset by manufacturing
inefficiencies and higher SG&A expenses.
During the second quarter, utilization of the Company's
revolving bank credit facility increased by U.S. $37.0 million due
to the cash requirements to finance the seasonal increase in
accounts receivable and capital expenditures of U.S. $44.7 million.
The Company ended the second quarter of the fiscal year with bank
indebtedness of U.S. $214.0 million and cash and cash equivalents
of U.S. $72.7 million.
Year-To-Date Sales and Earnings
Net sales revenues for the first six months of fiscal 2013
amounted to U.S. $943.8 million, up 20.0% from U.S. $786.4 million
in fiscal 2012. The increase in net sales versus fiscal 2012 was
due to the acquisition of Anvil, higher Printwear unit sales
volumes, and growth in sales of Gildan® branded activewear to
retail customers. These factors were partially offset by lower net
selling prices for Printwear and lower sales of socks. Sales in the
first half of fiscal of 2013 were also impacted by the inventory
devaluation discount in the second quarter. Sales in fiscal 2012
were impacted by a U.S. $19 million distributor inventory
devaluation discount, in the first quarter of the fiscal year.
Net earnings in the first half of fiscal 2013 were U.S. $107.6
million or U.S. $0.88 per share on a diluted basis, compared to net
loss of U.S. $19.2 million or U.S. $0.16 per share in the first six
months of fiscal 2012. Adjusted net earnings before restructuring
and acquisition-related costs amounted to U.S. $111.8 million or
U.S. $0.91 per share, compared to adjusted net loss of U.S. $18.0
million or U.S. $0.15 per share in fiscal 2012. The increase in
adjusted EPS in fiscal 2013 compared to last year reflected
improved results in both Printwear and Branded Apparel, due to
lower cotton costs, higher unit sales volumes, and more favourable
product-mix, partially offset by lower Printwear net selling
prices, increased selling, general and administrative expenses, and
higher income taxes.
Outlook
Net sales revenues for fiscal 2013 are now projected to be
slightly in excess of U.S. $2.15 billion. Net sales for Printwear
are projected to be approximately U.S. $1.45 billion, and net sales
for Branded Apparel are projected to be slightly in excess of U.S.
$0.7 billion. The Company now expects full year adjusted EPS of
U.S. $2.65-$2.70, which is at the upper end of its previous
guidance range of EPS of U.S. $2.60-$2.70 for the full fiscal year,
as the more favourable than projected second quarter results and
projected increased supply chain and manufacturing efficiencies in
the balance of the year are assumed to offset the negative impact
of higher than previously projected cotton costs in the fourth
quarter. Other material assumptions are essentially unchanged from
the Company's previous guidance. The Company is assuming in its
guidance that there is no major change in market and economic
conditions.
The Company is projecting adjusted net earnings per share for
the third fiscal quarter of U.S. $0.92-$0.95, compared with
adjusted EPS of U.S. $0.66 in the third quarter of fiscal 2012. The
projected growth in EPS in the third quarter compared with the
third quarter of last year reflects significantly lower cotton
costs together with assumed higher unit sales volumes and more
favourable product-mix for both Printwear and Branded Apparel, and
increased supply chain and manufacturing efficiencies, which are
projected to be partially offset by lower net selling prices for
Printwear, higher selling, general and administrative expenses and
higher income taxes. Net sales revenues in the third quarter are
projected to be approximately U.S. $630 million.
The Company is continuing to project free cash flow in excess of
U.S. $200 million in fiscal 2013. Capital expenditures are still
projected to be approximately U.S. $200 million, including a total
of approximately U.S. $85 million for yarn-spinning investments.
The ramp-up of the Rio Nance V textile facility is now essentially
complete. The Company is currently upgrading equipment at the
former Anvil facility in Honduras to support its growth in more
specialized performance products. Notwithstanding the Company's
decision to increase the utilization of the Anvil manufacturing
facility, the ramp-up of Rio Nance I is still scheduled to begin in
the fourth quarter of fiscal 2013. The Company is making further
investments in its biomass facilities at Rio Nance and has begun
construction of its Honduran distribution centre.
Based on its projected cash flows, and without any further uses
of cash, the Company currently anticipates that it will be in a
position to have substantially repaid the bank indebtedness
incurred to finance both the Gold Toe and Anvil acquisitions by the
end of the fiscal year. The Company's earnings guidance does not
take account of a possible charge if it is no longer economic to
maintain interest rate swaps, which were entered into in 2011 when
it increased its revolving bank credit facility to finance the
acquisition of Gold Toe, in order to mitigate its exposure to a
potential future increase in interest rates. The unrealized loss on
the interest rate swaps is currently approximately U.S. $5 million.
The decision whether to unwind the swaps will be based on the
projected uses of the Company's free cash flow in the second half
of fiscal 2013 and in fiscal 2014.
The Company believes that it is well positioned for continuing
growth in sales and earnings, as it brings capacity on-stream to
support its sales growth initiatives in both operating segments. In
addition, the Company is continuing to invest in manufacturing cost
reduction projects and increased vertical integration, and also
expects to leverage the investment which it has made in building an
overhead infrastructure to drive the further development of its
Branded Apparel business.
Declaration of Quarterly Dividend
The Board of Directors has declared a cash dividend of U.S.
$0.09 per share, payable on June 10, 2013 to shareholders of record
on May 16, 2013. This dividend is an "eligible dividend" for the
purposes of the Income Tax Act (Canada) and any other applicable
provincial legislation pertaining to eligible dividends.
Disclosure of Outstanding Share Data
As of April 30, 2013, there were 121,672,118 common shares
issued and outstanding along with 1,199,928 stock options and
828,496 dilutive restricted share units (Treasury RSUs)
outstanding. Each stock option entitles the holder to purchase one
common share at the end of the vesting period at a pre-determined
option price. Each Treasury RSU entitles the holder to receive one
common share from treasury at the end of the vesting period,
without any monetary consideration being paid to the Company.
However, the vesting of at least 50% of each Treasury RSU grant is
contingent on the achievement of performance conditions that are
primarily based on the Company's average return on assets
performance for the period as compared to the S&P/TSX Capped
Consumer Discretionary Index, excluding income trusts, or as
determined by the Board of Directors.
Consolidated Financial Data -
unaudited
----------------------------------------------------------------------------
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(in US$ millions, except per
share amounts or otherwise
indicated) Q2 2013 Q2 2012 YTD 2013 YTD 2012
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Net sales 523.0 482.6 943.8 786.4
Gross profit 151.2 86.1 263.8 92.4
SG&A expenses 73.6 53.9 143.0 104.8
Operating income (loss) 76.9 30.5 114.7 (14.2)
EBITDA(1) 101.8 52.7 163.7 26.4
Net earnings (loss) 72.3 26.9 107.6 (19.2)
Adjusted net earnings
(loss)(1) 72.7 27.8 111.8 (18.0)
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Diluted EPS 0.59 0.22 0.88 (0.16)
Adjusted diluted EPS(1) 0.59 0.23 0.91 (0.15)
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Gross margin 28.9% 17.8% 28.0% 11.8%
SG&A expense as a percentage
of sales 14.1% 11.2% 15.1% 13.3%
Operating margin 14.7% 6.3% 12.2% (1.8)%
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Cash flows from (used in)
operations 24.9 3.0 70.3 (109.4)
Free cash flow(1) (19.6) (20.4) 1.7 (156.3)
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March 31, September 30,
As at 2013 2012
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Inventories 625.5 553.1
Trade accounts receivable 270.7 260.6
Net indebtedness(1) 141.3 110.6
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(1) Please refer to "Non-GAAP Financial Measures" in this press release.
Certain minor rounding variances exist between the condensed interim
consolidated financial statements and this summary.
Segmented Financial Data -
unaudited
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(in US$ millions) Q2 2013 Q2 2012 YTD 2013 YTD 2012
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Segmented net sales:
Printwear 368.0 360.9 611.7 508.1
Branded Apparel 155.0 121.7 332.1 278.3
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Total net sales 523.0 482.6 943.8 786.4
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Segment operating income:
Printwear 87.3 50.1 133.2 19.3
Branded Apparel 13.4 1.1 33.1 3.6
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Total segment operating
income 100.7 51.2 166.3 22.9
Corporate and other(1) (23.8) (20.7) (51.6) (37.1)
----------------------------------------------------------------------------
Total operating income (loss) 76.9 30.5 114.7 (14.2)
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(1) Includes corporate head office expenses, restructuring and acquisition-
related costs, and amortization of intangible assets, excluding software.
Certain minor rounding variances exist between the condensed interim
consolidated financial statements and this summary.
Information for Shareholders
Gildan Activewear Inc. will hold a conference call to discuss
these results today at 8:30 AM ET. The conference call can be
accessed by dialing (800) 447-0521 (Canada & U.S.) or (847)
413-3238 (international) and entering passcode 34686877, or by live
sound webcast on Gildan's website ("Investor Relations" section) at
the following address:
http://gildan.com/corporate/IR/webcastPresentations.cfm. If you are
unable to participate in the conference call, a replay will be
available starting that same day at 10:30 AM ET by dialing (888)
843-7419 (Canada & U.S.) or (630) 652-3042 (international) and
entering passcode 34686877#, until Thursday, May 9, 2013 at
midnight, or by sound webcast on Gildan's corporate website for 30
days following the live webcast.
This release should be read in conjunction with Gildan's 2013
Second Quarter Management's Discussion and Analysis dated May 1,
2013 and its unaudited condensed interim consolidated financial
statements for the six months ended March 31, 2013 (available at
http://gildan.com/corporate/IR/quarterlyReports.cfm) which is
incorporated by reference in this release, and which will be filed
by Gildan with the Canadian securities regulatory authorities and
with the U.S. Securities and Exchange Commission.
About Gildan
Gildan is a leading supplier of quality branded basic family
apparel, including T-shirts, fleece, sport shirts, socks and
underwear. The Company sells its products under a diversified
portfolio of Company-owned brands, including the Gildan®, Gold Toe®
and Anvil® brands and brand extensions, as well as under license
agreements for the Under Armour® and New Balance® brands. The
Company distributes its products in printwear markets in the U.S.
and Canada, where Gildan® is the industry-leading brand, and the
Company is increasing its penetration in international printwear
markets. The Company is also one of the largest suppliers of
branded athletic, casual and dress socks for a broad spectrum of
retailers in the U.S., and is developing Gildan® as a consumer
brand for underwear and activewear.
Gildan owns and operates vertically-integrated, large-scale
manufacturing facilities which are primarily located in Central
America and the Caribbean Basin to efficiently service the
replenishment needs of its customers in the printwear and retail
markets. Gildan has over 33,000 employees worldwide and is
committed to industry-leading labour and environmental practices in
all of its facilities. More information about the Company and its
corporate citizenship practices and initiatives can be found at its
corporate websites www.gildan.com and www.genuinegildan.com,
respectively.
Forward-Looking Statements
Certain statements included in this press release constitute
"forward-looking statements" within the meaning of the U.S. Private
Securities Litigation Reform Act of 1995 and Canadian securities
legislation and regulations, and are subject to important risks,
uncertainties and assumptions. This forward-looking information
includes, amongst others, information with respect to our
objectives and the strategies to achieve these objectives, as well
as information with respect to our beliefs, plans, expectations,
anticipations, estimates and intentions, including, without
limitation, our expectation with regards to unit volume growth,
sales revenue, accretion from acquisitions, product-mix, selling,
general and administrative expenses, earnings per share, capital
expenditures, manufacturing efficiencies, selling prices, cotton
costs and other manufacturing cost inputs, income tax rate, and
free cash flow. Forward-looking statements generally can be
identified by the use of conditional or forward-looking terminology
such as "may", "will", "expect", "intend", "estimate", "project",
"assume", "anticipate", "plan", "foresee", "believe" or "continue"
or the negatives of these terms or variations of them or similar
terminology. We refer you to the Company's filings with the
Canadian securities regulatory authorities and the U.S. Securities
and Exchange Commission, as well as the risks described under the
"Financial risk management", "Critical accounting estimates and
judgments" and "Risks and uncertainties" sections of the 2012
Annual MD&A for a discussion of the various factors that may
affect the Company's future results. Material factors and
assumptions that were applied in drawing a conclusion or making a
forecast or projection are also set out throughout this
document.
Forward-looking information is inherently uncertain and the
results or events predicted in such forward-looking information may
differ materially from actual results or events. Material factors,
which could cause actual results or events to differ materially
from a conclusion, forecast or projection in such forward-looking
information, include, but are not limited to:
-- our ability to implement our growth strategies and plans, including
achieving market share gains, obtaining and successfully introducing new
sales programs, implementing cost reduction initiatives and completing
and successfully integrating acquisitions;
-- the intensity of competitive activity and our ability to compete
effectively;
-- adverse changes in general economic and financial conditions globally or
in one or more of the markets we serve;
-- our reliance on a small number of significant customers;
-- the fact that our customers do not commit contractually to minimum
quantity purchases;
-- our ability to anticipate changes in consumer preferences and trends;
-- our ability to manage production and inventory levels effectively in
relation to changes in customer demand;
-- fluctuations and volatility in the price of raw materials used to
manufacture our products, such as cotton and polyester fibres;
-- our dependence on a small number of key suppliers and our ability to
maintain an uninterrupted supply of raw materials and finished goods;
-- the impact of climate, political, social and economic risks in the
countries in which we operate or from which we source production;
-- disruption to manufacturing and distribution activities due to such
factors as operational issues, disruptions in transportation logistic
functions, labour disruptions, political or social instability, bad
weather, natural disasters, pandemics and other unforeseen adverse
events;
-- changes to international trade legislation that the Company is currently
relying on in conducting its manufacturing operations or the application
of safeguards thereunder;
-- factors or circumstances that could increase our effective income tax
rate, including the outcome of any tax audits or changes to applicable
tax laws or treaties;
-- compliance with applicable environmental, tax, trade, employment, health
and safety, anti-corruption, privacy and other laws and regulations in
the jurisdictions in which we operate;
-- our significant reliance on computerized information systems for our
business operations, including our JD Edwards Enterprise Resource
Planning (ERP) system which is currently being upgraded to the latest
system release, Enterprise One;
-- changes in our relationship with our employees or changes to domestic
and foreign employment laws and regulations;
-- negative publicity as a result of violation of local labour laws or
international labour standards, or unethical labour or other business
practices by the Company or one of its third-party contractors;
-- our dependence on key management and our ability to attract and/or
retain key personnel;
-- changes to and failure to comply with consumer product safety laws and
regulations;
-- adverse changes in third party licensing arrangements and licensed
brands;
-- our ability to protect our intellectual property rights;
-- changes in accounting policies and estimates;
-- exposure to risks arising from financial instruments, including credit
risk, liquidity risk, foreign currency risk and interest rate risk, as
well as risks arising from commodity prices; and
-- the adverse impact of any current or future legal and regulatory
actions.
These factors may cause the Company's actual performance and
financial results in future periods to differ materially from any
estimates or projections of future performance or results expressed
or implied by such forward-looking statements. Forward-looking
statements do not take into account the effect that transactions or
non-recurring or other special items announced or occurring after
the statements are made, may have on the Company's business. For
example, they do not include the effect of business dispositions,
acquisitions, other business transactions, asset write-downs, asset
impairment losses or other charges announced or occurring after
forward-looking statements are made. The financial impact of such
transactions and non-recurring and other special items can be
complex and necessarily depends on the facts particular to each of
them.
There can be no assurance that the expectations represented by
our forward-looking statements will prove to be correct. The
purpose of the forward-looking statements is to provide the reader
with a description of management's expectations regarding the
Company's future financial performance and may not be appropriate
for other purposes. Furthermore, unless otherwise stated, the
forward-looking statements contained in this press release are made
as of the date of this press release, and we do not undertake any
obligation to update publicly or to revise any of the included
forward-looking statements, whether as a result of new information,
future events or otherwise unless required by applicable
legislation or regulation. The forward-looking statements contained
in this press release are expressly qualified by this cautionary
statement.
Non-GAAP Financial Measures
This press release includes references to certain non-GAAP
financial measures such as EBITDA, adjusted net earnings, adjusted
diluted EPS, free cash flow, total indebtedness, and net
indebtedness. These non-GAAP measures do not have any standardized
meanings prescribed by International Financial Reporting Standards
(IFRS) and are therefore unlikely to be comparable to similar
measures presented by other companies. Accordingly, they should not
be considered in isolation. The terms and definitions of the
non-GAAP measures used in this press release and a reconciliation
of each non-GAAP measure to the most directly comparable IFRS
measure are provided below.
EBITDA
EBITDA is calculated as earnings before financial expenses,
income taxes and depreciation and amortization and excludes the
impact of restructuring and acquisition-related costs, as well as
the equity earnings in investment in joint venture. The Company
uses EBITDA, among other measures, to assess the operating
performance of its business. The Company also believes this measure
is commonly used by investors and analysts to measure a company's
ability to service debt and to meet other payment obligations, or
as a common valuation measurement. The Company excludes
depreciation and amortization expenses, which are non-cash in
nature and can vary significantly depending upon accounting methods
or non-operating factors such as historical cost. Excluding these
items does not imply they are necessarily non-recurring.
----------------------------------------------------------------------------
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(in U.S.$ millions) Q2 2013 Q2 2012 YTD 2013 YTD 2012
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Net earnings (loss) 72.3 26.9 107.6 (19.2)
Restructuring and
acquisition-related costs 0.8 1.6 6.1 1.9
Depreciation and
amortization 24.1 20.6 42.8 38.7
Financial expenses, net 1.6 2.9 3.9 4.9
Income tax expense 3.0 0.5 3.3 0.1
Equity earnings in
investment in joint venture - 0.2 - -
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EBITDA 101.8 52.7 163.7 26.4
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Certain minor rounding variances exist between the condensed
interim consolidated financial statements and this summary.
Adjusted net earnings and adjusted diluted EPS
Adjusted net earnings and adjusted diluted earnings per share
are calculated as net earnings and diluted earnings per share
excluding restructuring and acquisition-related costs, net of
related income tax recoveries. The Company uses and presents these
non-GAAP measures to assess its operating performance from one
period to the next without the variation caused by restructuring
and acquisition-related costs, net of related income tax
recoveries, that could potentially distort the analysis of trends
in its business performance. Excluding these items does not imply
they are necessarily non-recurring.
----------------------------------------------------------------------------
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(in U.S.$ millions, except
per share amounts) Q2 2013 Q2 2012 YTD 2013 YTD 2012
----------------------------------------------------------------------------
Net earnings (loss) 72.3 26.9 107.6 (19.2)
Adjustments for:
Restructuring and
acquisition-related costs 0.8 1.6 6.1 1.9
Income tax recovery on
restructuring and
acquisition-related costs (0.4) (0.7) (1.9) (0.7)
----------------------------------------------------------------------------
Adjusted net earnings (loss) 72.7 27.8 111.8 (18.0)
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Basic EPS 0.60 0.22 0.89 (0.16)
Diluted EPS 0.59 0.22 0.88 (0.16)
Adjusted diluted EPS 0.59 0.23 0.91 (0.15)
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Certain minor rounding variances exist between the condensed
interim consolidated financial statements and this summary.
Free cash flow
Free cash flow is defined as cash from operating activities
including net changes in non-cash working capital balances, less
cash flow used in investing activities excluding business
acquisitions. The Company considers free cash flow to be an
important indicator of the financial strength and performance of
its business, because it shows how much cash is available after
capital expenditures to repay debt and to reinvest in its business,
and/or to redistribute to its shareholders. The Company believes
this measure is commonly used by investors and analysts when
valuing a business and its underlying assets.
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(in U.S.$ millions) Q2 2013 Q2 2012 YTD 2013 YTD 2012
----------------------------------------------------------------------------
Cash flows from (used in)
operating activities 24.9 3.0 70.3 (109.4)
Cash flows used in investing
activities (44.5) (23.4) (71.1) (46.9)
Adjustment for:
Business acquisition - - 2.5 -
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Free cash flow (19.6) (20.4) 1.7 (156.3)
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Certain minor rounding variances exist between the condensed
interim consolidated financial statements and this summary.
Total indebtedness and Net indebtedness
Total indebtedness is defined as the total of bank indebtedness
and long-term debt (including any current portion), and net
indebtedness is calculated as total indebtedness net of cash and
cash equivalents. The Company considers total indebtedness and net
indebtedness to be important indicators of the financial leverage
of the Company.
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March 31, September 30,
(in U.S.$ millions) 2013 2012
----------------------------------------------------------------------------
Long-term debt and total indebtedness 214.0 181.0
Cash and cash equivalents (72.7) (70.4)
----------------------------------------------------------------------------
Net indebtedness 141.3 110.6
----------------------------------------------------------------------------
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Certain minor rounding variances exist between the condensed
interim consolidated financial statements and this summary.
Contacts: Investor Relations Laurence G. Sellyn Executive
Vice-President Chief Financial and Administrative Office (514)
343-8805lsellyn@gildan.com Sophie Argiriou Director Investor
Communications (514) 343-8815sargiriou@gildan.com Media Relations
Genevieve Gosselin Director, Corporate Communications (514)
343-8814ggosselin@gildan.com
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