- Gildan Activewear (GIL) has reported a substantial slide in sales for the period ending June 28, 2020, after COVID-19 caused widespread retail shutdowns
- Net sales fell 71.3 per cent from almost C$1.08 billion in the second quarter of 2019 to $309 million this year
- Similarly, the company reported an adjusted gross loss of $164.7 million this year compared to an adjusted gross profit of $299.5 million last year
- The company said the decrease in performance reflected the widespread government-mandated closures which began in the latter part of March
- Gildan Activewear (GIL) is currently up 0.33 per cent and is trading at $24.02 per share at 3:14pm EDT
Gildan Activewear (GIL) has reported a substantial slide in sales for the period ending June 28, 2020, after COVID-19 caused widespread retail shutdowns.
The clothing manufacturer's net sales fell 71.3 per cent during the quarter, from almost C$1.08 billion in the same period of 2019 to just $309 million this year.
Similarly, Gildan reported an adjusted gross loss of $164.7 million compared to an adjusted gross profit of $299.5 million last year.
The marked decrease was primarily driven by a significant downturn in demand, which was brought on as a result of widespread government-mandated retail closures in an effort to curb the spread of the pandemic.
This, in turn, led to hefty de-stocking among distributors, an unfavourable product mix and higher promotional discounting.
However, Gildan also saw a 29.5 per cent drop in expenses, from almost $124 million to just over $87 million.
This came as a result of lower compensation and volume-driven distribution costs, as well as significant cost containment measures.
Glenn Chamandy, President and CEO of Gildan Activewear, noted that the company's management elected to take a long-term approach to the management of the pandemic's influence.
"Despite the impact of the COVID-19 pandemic, we maintained a strong focus on our key priorities, including the health and safety of our employees and the long term positioning of our business.
"Against the challenging backdrop of the pandemic and the difficult but necessary actions we have taken, we have accelerated efforts under our 'Back to Basics' strategy to further simplify our product portfolios, remove complexity and cost from our business, better support our customers and drive long term market share growth," he said.
Despite the perceived signs of recovery, including the resumption of production operations, Gildan cautioned that a significant level of uncertainty remains regarding the impact of the virus and the pace at which global economies will recover.
Gildan Activewear (GIL) is currently up 0.33 per cent and is trading at $24.02 per share at 3:14pm EDT.